How HRMS improves your HR forecasting
Planning, forecasting, strategizing… just as important for a business’s human resources as for any other kind. As such, you would expect an HRMS to support and enhance the forecasting process. And you’d be right.
What is HR forecasting?
Put simply, HR forecasting is looking ahead and calculating what workforce or skills you need to fulfill your future business objectives; based on sales projections, growth, product or service launches, likely turnover, etc. That might sound a bit crystal ball-ish but in reality, it should be a data-based activity and in that sense, your HRMS is the best crystal ball you can get.
1. Getting the data right
HR forecasting is essentially about balancing supply and demand, as in the supply of labor to meet the demand of your business and customers. If you can look at your upcoming production schedule or service strategy and identify what people and skills you need, your HRMS has the data to assess your current workforce in light of that.
If you identify a shortfall, your HRMS can support the necessary training, performance management, and recruitment to bring the workforce up to strength. If you have a foreseeable excess, the data in your HRMS can be used to identify redeployment opportunities or, if necessary, downsizing.
Naturally, knowing your staffing requirements enables you to forecast costs as well as people. You know the return you’re hoping for from your business strategy (the additional sales, the competitive advantage, the reputational and branding benefits) and once you have a supporting HR strategy, you can cost that out, supported by your HRMS data, and confirm the likelihood of a return on that investment.
3. Dig deeper
Taking full advantage of the data in your HRMS, you can drill down further and create more sophisticated HR forecasts. First, using historical data, you can predict anticipated changes to the workforce in terms of turnover, promotions, retirements, etc. Second, you can forecast staffing impacts related to specific events; for example, the impact of a new piece of legislation, or the introduction of a new product requiring new manufacturing procedures. Third, you can hash out the implications of changes in strategy; such as targeting a new niche market, or a proposal to outsource support services.
It’s a cliché but HR is still often asked to prove its worth on the harder-edged business side of things. Anybody working in HR knows that the function is actually very business-focused (it has to be!) but proving that to colleagues can be difficult. Providing detailed, data-driven, and accurate HR forecasting is a necessary credibility boost for HR, and the repository of that data? Your HRMS.
Featured white papers
HRMS Software Pricing Guide
Get your comprehensive guide to the cost of HRMS software.Download
HRMS Software Vendor Directory
Put the most up-to-date HRMS vendor directory on your desk today! Over 60 vendors listed.Download
HRMS Selection Survival Guide
Select the right HRMS for your company with this easy-to-follow guideDownload
Succession planning with your HRMS
What is succession planning, and how can HRMS help?
How to use HRMS to identify your organization's future leaders
Here are five key ways you can utilize your HRMS during succession planning
3 Tips for Integrating HRMS and Talent Systems
Learn from our expert’s tips on how to implement and utilize HRMS and talent system integrations.