Headcount Forecasting Planning Model

Forecast headcount and costs by analyzing employee movement trends, upcoming retirements, and hiring rates.

Overview

Optimize your workforce and make informed decisions with Visier's Headcount Forecasting. Gain valuable insights into future headcount and associated costs by analyzing historical employee data and predicting upcoming trends in retirements, resignations, and new hires. The model empowers you to proactively manage recruitment needs, ensuring you have the right talent at the right time, while also enabling you to assess the financial impact of policy adjustments on your budget and overall recruitment strategy. By incorporating comprehensive Talent Acquisition data, including known and expected starts, backfills, and exits, the model provides a holistic view of your workforce, allowing you to confidently plan for the future.

The plan items

Headcount Forecasting draws on historical data and plan values to project future headcount and associated costs. Use the following plan items to create a customized and actionable plan that aligns with your organization's unique goals and objectives.

Plan prompts

The following plan prompt is defined during plan creation and becomes a dynamic value in the plan. For example, if you set the retirement age to 65, then expected future retirements will be based on employees who turn 65 in a particular future period.

Retirement Age: The age at which employees become eligible for retirement.

Assumptions

Adjust the following plan items to model the Projected Ending Headcount, which is the projected number of employees after all starts and exits for the plan period.

Time to Backfill: The average time, in months, between an employee exiting the organization and when the position would be backfilled. The initial value is the baseline value for mean Time to Backfill.
Freeze Hiring: Whether your organization is undergoing a hiring freeze on backfilled positions. Set this value to 1 for a particular month to indicate a hiring freeze. The frozen backfills will not carry forward to the end of the hiring freeze.
Additional Starts: A method to manually introduce extra employee starts in a specific period. The initial value is 0.
Expected Retirements: The number of current employees expected to retire in a plan period based on the month they reach the retirement age. Employees with Future Known Retirements do not contribute to this value.
Predicted Annual Resignation Rate: The predicted annualized rate of employee resignations for the plan period. The initial value is based on Visier’s predictive model.
Annualized Other Exits Rate: The annualized rate of employee exits for reasons other than resignation and retirement for the plan period. The initial value is the baseline value for the Annualized Other Exits Rate.
Additional Exits: A method to manually introduce extra employee exits in a specific period. The initial value is 0.

Adjust the following plan items to model the Projected Ending FTE, which is the projected full-time equivalents based on the ending headcount for the plan period.

FTE Ratio: The average percentage of employee headcount to full-time equivalents for the plan period.

Adjust the following plan items to model the Projected Period Costs, which is the projected costs for the plan period.

Average Annual Cost per FTE: The average annual cost per full-time equivalent for the plan period.

Projections

Changes to your plan assumptions will affect the following plan items. Check the projections to see what you need to do to reach your headcount budget goal.

Starting Headcount: The projected number of employees at the start of the month for the plan period.
Open Positions from Open Requisitions: The number of open positions from open requisitions for the plan period.
Budgeted Headcount: The maximum number of employees for the plan period. This value is sourced from the Finance Plan Budgeted Headcount.
Difference Between Budgeted and Actual Headcount: The difference between Headcount at the start of the month and Budgeted Headcount for the plan period.
Net Employee Gain or Loss: The net number of employees after subtracting total exits from total starts for the plan period.
Total Starts: The sum of all types of employee starts for the plan period.
Expected Starts: The projected number of people expected to be hired based on the Time to Backfill and actual Open Positions for Open Requisitions in the baseline period.
Future Known Starts: The number of applicant hire events with an expected start date in a future time period.
Total Exits: The sum of all types of employee exits for the plan period.
Future Known Retirements: The number of employees with retirement records in a future time period.
Total Known and Predicted Resignations: The projected number of predicted resignations and future known resignations for the plan period.
Future Known Resignations: The number of employees with resignation records in a future time period.
Total Other Exits: The projected number of employee exits for reasons other than resignation and retirement for the plan period.
Future Known Other Exits: The number of employees with exit records for reasons other than resignation and retirement in a future time period.
Projected Ending Headcount: The projected number of employees after all starts and exits for the plan period.
Projected Ending FTE: The projected full-time equivalents based on the ending headcount for the plan period.
Budgeted FTEs: The maximum full-time equivalent count for the plan period. This value is sourced from the Financial Plan Overlay.
Projected Period Costs: The projected costs for the plan period.
Average Monthly Cost per FTE: The average monthly cost per full-time equivalent for the plan period.
Annualized Period Costs: The annualized costs for the plan period.
Budgeted Cost - Annualized: The annual budgeted cost for the plan period. This value is sourced from the Financial Plan Overlay.
Projected Cost - YTD: The running sum of all the period costs within the fiscal year for the plan period.
Budgeted Cost - YTD: The maximum YTD budgeted cost for the plan period.

Suggested workflow for using a headcount forecasting plan

Use the following steps as guidance when using your headcount forecasting plan. To illustrate this process, let's say you've created a Headcount Forecasting Plan with the goal of meeting your budgeted headcount in your Japan office. You've set the retirement age to 60.

Begin by looking at your Starting Headcount to assess the current state of your organization. Let's say you have 551 employees.
Compare this value to your Budgeted Headcount to determine if you are over or under budget. Let's say your budget is 222 employees.
To quickly see the difference at a glance, look at Difference Between Budgeted and Actual Headcount. In this case, the difference would be 329, meaning you are 329 employees over budget at your Japan office.
Determine some of the actions you can take to stay within the budget. Adjust one of the plan assumptions to model these actions. Let's say your organization will be implementing a hiring freeze in the upcoming months. In this case, you might increase the Freeze Hiring in a future period to 1 to indicate a hiring freeze in that particular month.
Check the Projected Ending Headcount to see how far you are from the budget after making your adjustments.
Repeat steps 4 and 5 until the projections meet your budget. If you're making unrealistic assumptions in order to reach your budget, consider pushing out the target date or changing the budget.