Indirect labor planning

The main focus of indirect labor planning is on calculating the number of required employees to perform work that is not directly involved in production. The indirect labor supports the production process but it is not directly attributable to a particular product or service.

In most cases, forecasting of indirect labor numbers is based on key operating indicators. These indicators, or parameters, are referred to as drivers. Workers who perform indirect labor are not directly engaged in the hands-on production of goods or services. Therefore, it may be difficult to calculate the necessary number of employees solely from planned sales figures. To address that complexity, we use drivers.

An example of a driver can be the number of shipments that drives the headcount in a logistics department. As many drivers as needed can be defined.