Chapter 6

Determining HR Demand
 Trend/Ratio Analysis

1. Select the appropriate Business/operational index

(ex-sales level)
2. Track the business index over time (at least 4 years)
3. Track the workforce size over time (same year as
step no. 2)
4. Calculate the average ration of the business index to
the workforce size (dividing the level of sales by the
number of employees in each year)
5. Calculate the demand for labor
 Regression Analysis
A linear relationship exists between one or more
independent variables to the dependent
variable.
 Y = A + BX
Y= The dependent variable; (HR demand, number of personnel required)
A= Constant (intercept), when X = 0
B= The slope of the linear relationship between X and Y.
X= The independent variable; (level of sales, production output)

ΣXY – N(X)(Y)
B= A = Y-BX
Σ(X2)-N(X)2
 SALES LEVEL NUMBER OF EMPLOYEES
2 20
3.5 32
4.5 42
6 55
7 66

X Y XY X2
2 20 40 4
3.5 32 112 12.25
4.5 42 189 20.25
6 55 330 36
7 66 432 49
ΣX= 23 ΣY=215 ΣXY = 1133 Σ(X2)= 121.50

X = 23/5 = 4.6 , Y = 215/5 = 43, B = 9.17, A = 0.82

Y = 0.82 + (9.17)(X)
Envelope/Scenario Forecasting

Note: For each estimation, there

is a particular staffing table
 Delphi Technique
• Named after the Greek oracle at Delphi and
developed by N.C. Dalkey and his associates at the
Rand Corporation in 1950.
• The main advantage of this technique is that it avoids
many of the problems associated with face-to-face
group--- like, 1. shyness, 2. perceived lower status or
authority, 3. perceived communication deficiency, 4.
individual dominance, 5. Politics
 Steps associated with Delphi Technique

• Define and refine the issue or question

• Indentify the experts, terms and time horizon
• Orient the expert
• Issue the first-round questionnaire
• Summary of first-round questionnaire and
second round questionnaire
• Continue issuing the questionnaire
 Nominal Group
• Define and refine the issue of question
• Identify the experts, terms and time horizon
• Issue the HR demand statement to the expert
• Apply expert knowledge, state assumption and
prepare an estimate
• Meet face to face
• Discuss the demand estimates and assumption
• Vote secretly to determine the expert demand
assessment.