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Employee Management

Recruitment and training of new employees need to be carefully planned to prevent shortages or surpluses. Using this example, a human resource manager or decision maker can vary the control parameters that relate to aspects of the human resource planning (HRP) process to test different HRP strategies.

The Model

A recruiting policy is used to control the rate of hiring so that the company’s workforce is at the desired level, given in full-time equivalents (FTE). The workforce in the present case is reduced by attrition, and as the average employment period is five years, it is modeled as an exponential delay of the third order.

The model is setup such that the workforce has an initial desired level of 750 FTE. The desired workforce is then set to ramp up by 450 FTE starting at the end of the first year over a time of six years.

Simulation Results

To keep track of the average experience of the workforce, years of relevant work experience will be measured. New employees will arrive with an experience of five years, but this will fall to just two years. This fall will start at the end of the first year and continue over four years, due to fierce competition for experienced workers.

The workforce closely follows the desired level and the average work experience drops significantly over the next years.

Human resource planning using the Business Simulation Library