Section Objectives

The planning process in staffing involves making forecasts of an organization$$s future hiring needs and developing methods the organization can use to meet these needs. The process of planning involves a combination of forecasting labor needs, comparing these needs to the labor availabilities, and determining where gaps exist. After these gaps are identified, general plans for filling these gaps are enacted.

Beyond the process of developing objectives for the number of individuals to be hired, planning activities often take the demographic composition of the workforce into consideration. Attending to the demographic breakdown of the workforce is important for several reasons, as noted in the material in Chapter $2$ of Staffing Organizations concerning the Business Case for Diversity and Inclusion. To evaluate diversity in staffing, the current workforce can be compared to the demographic characteristics of other individuals who work in similar jobs.

Planning for the State of Washington: Forecasting Requirements and Availabilities

The Staffing Services Director, Daryl Perrone, has requested your assistance in the completion of an HR planning analysis for the $50$ stores in two regional divisions in the state of Washington. After these overall goals are developed for the state, the policy will be disseminated across all $50$ individual stores. Data from the individual stores will then be sent to the corporate offices for analysis and re$-$evaluation.

The basic model for planning includes $(1)$ forecasting labor requirements, $(2)$ forecasting labor availabilities, $(3)$ conducting environmental scans, $(4)$ determining gaps, and $(5)$ developing action plans. These steps are described in Staffing Organizations. Conducting an adequate human resources selection plan will require you to take all these steps.

Historical data from these two divisions have been presented in the transition probability matrix. Information on how to read transition matrices is provided in Staffing Organizations. The transition probability matrix was developed based on the historical staffing pattern for Washington over the past five years. A first stage of investigating staffing is to use the previous years$$ staffing patterns as a preliminary forecast of labor requirements, the internal availability based on retention, internal promotions, transfers and demotions, and a determination of gaps by subtracting forecasted availabilities from future requirements. $$

Table $1\mathrm{.}1$ Markov Analysis Information

Transition probability matrix Current year

$(1)(2)(3)(4)(5)$ Exit

Previous year $(1)$ Store associate $0\mathrm{.}530\mathrm{.}060\mathrm{.}000\mathrm{.}000\mathrm{.}000\mathrm{.}41$

$(2)$ Shift leader $0\mathrm{.}000\mathrm{.}500\mathrm{.}160\mathrm{.}000\mathrm{.}000\mathrm{.}34$

$(3)$ Department manager $0\mathrm{.}000\mathrm{.}000\mathrm{.}580\mathrm{.}120\mathrm{.}000\mathrm{.}30$

$(4)$ Assistant store manager $0\mathrm{.}000\mathrm{.}000\mathrm{.}060\mathrm{.}460\mathrm{.}080\mathrm{.}40$

$(5)$ Store manager $0\mathrm{.}000\mathrm{.}000\mathrm{.}000\mathrm{.}000\mathrm{.}660\mathrm{.}34$

Forecast of availabilities Next year $($projected$)$

$(1)(2)(3)(4)(5)$ Exit

Current Workforce

Previous year $(1)$ Store associate $8,50045055100003485$

$(2)$ Shift leader $1,2000$

$(3)$ Department manager $8500$

$(4)$ Assistant store manager $1500$

$(5)$ Store manager $500$

Gap analysis Next year $($projected$)$

$(1)(2)(3)(4)(5)$

Year end total

$($column sum$)4505$

External hires needed

$($current workforce$-$total$)3995$

Forecasting Labor Requirements

The Washington market is very stable for Tanglewood. Most stores have been in existence for $10$ or more years and were indirectly managed by either Emerson or Wood when they were first established. Because of this stability, the estimate for the coming year$$s labor requirements is identical to the current year. So$,$ for example, they currently have $1,200$ individuals working as shift leader, and expect to need $1,200$ individuals to work as shift leaders for the coming year as well.

Forecasting Labor Availabilities

One primary source of information for immediate labor availability at Tanglewood is their internal labor market. Table $1\mathrm{.}1$ shows that Tanglewood has used internal promotions to fill many openings for the department manager, assistant store manager, and store manager positions. For example, it is projected that $16\%$ of shift leaders will be promoted to the rank of department manager, $12\%$ of department managers will be promoted to be assistant store managers, and $8\%$ of assistant store managers will be promoted to be store managers. However, it also appears that there will need to be considerable external hiring as well, since only $46\%-66\%$ of employees stay in the same position over a one$-$year period.

To estimate a labor forecast, the proportion $($percentage$)$ of individuals for the next year is multiplied by the current workforce number. For the shift leader, there are $1,200$ individuals in the position, of which, $50\%$ will remain for the next year. This means that the projected availability is $1,200\backslash$times $50\%=600.$ Similarly, $16\%$ of the shift leaders will be promoted t