Hiring Plan

The Hiring Plan sheet is an optional place to create a hiring plan for employees, which links back into Forecast for aggregation. You can input hires directly on Forecast using the same methodology - Hiring Plan just gives you a separate sheet for the detail.

Currently a feature in the Standard Financial Model.

How to use

The Hiring Plan sheet uses the same structure as the Forecast sheet, using the series of inputs to define start dates, amounts paid per month, and any regular increases in compensation. Each row can represent one person or one role (multiple people), depending on how you want to use it. Here are a couple common uses:

• Each row represents one person. Input their annual or monthly salary in "Initial Value", set the "Starts in period #" to the month when they are first hired ("1" if they are already hired or hired in the first month in the model), input "1" for "Repeats every N month" so that they stay employed every month.
• Each row represents one role. In some uses, especially forecasting hiring plans post 1-2 years in the future, it can be much more efficient to create a schedule of hires based on the growth of the business, using metrics like "# per" customers or users or "% of" revenues to define how to hire as you scale.
• Separate rows for number of people and salaries. In come uses, if one row represents one role, you may want to separate out the number of people and the salaries paid into separate rows. You can use the same drivers or create your own calculations, and can report them separately if desired.

The Hiring Plan is prelinked into Forecast to pull in salaries. "Salaries" here is a label for total expense on Hiring Plan - it can cover employees, non-employees, bonuses, benefits, contractor comp, etc. depending on how you use it. This line is an operating metric, not an SG&A expense, so salaries are linked into the model and a driver is used to set 100% of the salaries into the "Salaries & Benefits" category or "Salaries & Benefits (per department)" categories. You can link all salaries into the Total Salaries line, or into each department or SG&A group.

Inputs

The usage of the inputs for columns K through R are detailed at Drivers, and work exactly the same as the Expenses section on the Forecast sheet. These prebuilt inputs and formulas in the months allow you to easily build in salaries that increase at regular times, or calculate new hires, total employees, hires by roles, and new and total compensation by role based on the business (percentage of revenues, per customer, per user, per employee, etc.). The one addition is the column labeled "Annual or Monthly Inputs", which allows you to select whether the Initial Value you input in the column next to it represents an annual or monthly salary.

Some people prefer thinking in terms of annual salaries, which differs from the rest of the model which asks for monthly inputs, so this small addition helps structure the input in a way that is familiar to lots of people. This is only available on the Hiring Plan sheet, and not the Forecast sheet.

All cells under the months are input cells, you can always type over the formulas with exact amounts and months if you have specifics to your hires that are not easily modeled using the prebuilt drivers.

Common Modifications

There are a few common modifications or uses to point out:

• Add new employees and total employees to the operating metrics on Forecast. Given the flexibility of Hiring Plan, this can take work. By default Forecast has lines for New Employees and Employees that automatically bring in any lines on Hiring Plan using the New Employees or Total Employees categories (column D). Create a calculation that totals employees in the hiring plan and reports it using that category - it will flow through. The approach varies depending on whether one line represents one person or one role, and whether you're inputting salaries directly or calculating people. Sum for your use case, report on Hiring Plan, and it will flow through the rest of the model.