Strategic Human Resource Management

Section Three

FIGURE 3-1
Markov Model for Forecasting Supply

Note: Numbers of employees in each job in Time 2 are rounded off to the nearest
whole number.

The transition probabilities for Markov models are
typically derived from historical data on the movements of
employees between jobs, as well as exit moves from the
organization. For example, transition probabilities from Job 1 to
Job 2 might be determined by computing the percentage of
employees in Job 1 who make such a move over a one-year
time period. An important consideration for the use of Markov
models is that with small numbers of job incumbents, the