Strategic Modelling and Business Dynamics: A Feedback Systems Approach

5.4. Modelling Workforce Management and Factory Production Dynamics

5.4.1. Dialogue About Workforce Management

Figure 5.17 is a stock and flow diagram for workforce management. In this sector, the main policies are workforce planning, hiring and departures. Let's resume the imaginary dialogue between a modeller and factory expert that led to such a picture.

Modeller:	Tell me about workforce management.
Factory expert:	Usuallyasmall committee comes together every weektodiscuss changes in the workforce. If there is a downturn in the business then normally we let workers go by attrition and don't replace them. If there is an upturn then we need more workers.
Modeller:	How do you decide the number of workers you need in the factory?
Factory expert:	Well that's difficult to pinpoint. We know the weekly build schedule (desired production) and we monitor the productivity of our workers (based on a standard two-shift rota). From those two information sources we can estimate how many workers are needed.
Modeller:	So what happens if you have too many or too few workers?
Factory expert:	If we have too few workers we hire more. It takes time to fill vacancies because we like to honour employment commitments and that makes us fairly cautious about adding new people. If demand is growing we may be temporarily short of workers, which means we can't always produce exactly to plan. If we have too many workers, then we normally reduce the workforce through natural attrition, avoiding forced lay-offs, consistent ...