How do you manage volatility in workforce forecasting?

1 Assess your volatility sources

The first step to manage volatility in workforce forecasting is to identify and assess the sources of volatility that affect your organization. You need to understand the frequency, magnitude, and direction of the changes that can impact your workforce demand and supply. For example, you can analyze historical data, customer feedback, industry trends, and competitor actions to determine the patterns and drivers of volatility in your market. You can also conduct surveys, interviews, and focus groups with your employees, managers, and stakeholders to identify the factors that influence their performance, engagement, and retention. By assessing your volatility sources, you can prioritize the most critical and relevant ones for your workforce forecasting.

2 Use scenario planning

The second step to manage volatility in workforce forecasting is to use scenario planning. Scenario planning is a technique that helps you create and compare different possible futures based on your volatility sources. You can use scenario planning to explore the best-case, worst-case, and most-likely scenarios for your workforce demand and supply. For example, you can use scenario planning to estimate how your workforce needs will change under different levels of customer demand, economic growth, technological innovation, or regulatory change. You can also use scenario planning to assess how your workforce availability will change under different rates of employee turnover, absenteeism, skill development, or mobility. By using scenario planning, you can prepare for various contingencies and opportunities for your workforce forecasting.

3 Adjust your forecasting methods

The third step to manage volatility in workforce forecasting is to adjust your forecasting methods. Forecasting methods are the techniques and tools that you use to project your workforce demand and supply based on your data and assumptions. You need to adjust your forecasting methods to account for the volatility in your workforce environment. For example, you can use qualitative methods, such as expert opinions, Delphi methods, or nominal group techniques, to supplement your quantitative methods, such as trend analysis, regression analysis, or simulation models, when you have limited or unreliable data. You can also use adaptive methods, such as moving averages, exponential smoothing, or time series analysis, to update your forecasts more frequently and accurately based on the latest information. By adjusting your forecasting methods, you can improve the reliability and validity of your workforce forecasting.

4 Implement flexible strategies

The fourth step to manage volatility in workforce forecasting is to implement flexible strategies. Flexible strategies are the actions and policies that you use to align your workforce demand and supply based on your forecasts. You need to implement flexible strategies to respond to the volatility in your workforce environment. For example, you can use flexible hiring strategies, such as outsourcing, contracting, or temporary staffing, to cope with fluctuations in workforce demand. You can also use flexible scheduling strategies, such as part-time, shift, or flexible work arrangements, to optimize workforce utilization and productivity. You can also use flexible development strategies, such as cross-training, mentoring, or career planning, to enhance workforce skills and mobility. By implementing flexible strategies, you can increase the agility and resilience of your workforce forecasting.

5 Monitor and evaluate your results

The fifth step to manage volatility in workforce forecasting is to monitor and evaluate your results. Monitoring and evaluation are the processes of measuring and assessing the outcomes and impacts of your workforce forecasting. You need to monitor and evaluate your results to manage the volatility in your workforce environment. For example, you can use key performance indicators (KPIs), such as customer satisfaction, employee engagement, or profitability, to track the effectiveness and efficiency of your workforce forecasting. You can also use feedback mechanisms, such as surveys, audits, or reviews, to collect and analyze the opinions and suggestions of your customers, employees, managers, and stakeholders. By monitoring and evaluating your results, you can identify and address the gaps and challenges in your workforce forecasting.

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?