Recruiting and Selection
Recruiting and Selection
Staffing & Selection
© Nancy Brown Johnson
Staffing and Selection
Making decisions about how to get work done
in your organization
labor derived demand
past demand (if stable)
other leading indicators
Reconciliation of Supply &
Plan for training
Other trends in staffing arrangements
Try out employees
Tension with permanent employees
second class citizens
permanent employees threatened
Contract entire operations
Less expensive labor
Economies of scale
increased or decreased productivity
loss of good employees
commitment among survivors
process of attracting
people to apply to your
organization for work
process of choosing
employees for your
Tried to optimize job based skills
Today more consideration of the
match between the person and the
People are attracted to
organizations where they feel
Organizations try to select people who
fit within the organization.
People who do not fit, will leave.
Organizations become more
homogeneous over time
Recognizes the need to consciously
select people that fit within organization
Organizations may also need to
consciously change recruiting to attract
people who are different.
Realistic Job Previews
Recruiter's information is accurate.
Realistic Job Preview
Vaccination - prevents formation of
Choice based on accurate and balanced
- judging job based upon needs.
More freedom & choice
More committed when free to choose.
Realistic Job Previews
Works best when:
candidate can be selective in accepting a job offer
has unrealistic job expectations
would have difficulty coping with job demands
Two Ways to Staff Job Recruiting
Externally - recruiting people from outside
a. brings in fresh blood
c. new people may hinder group morale
Second Way to Staff
Internally - moves between jobs in an
Important for organization
Affects career decisions
Can be a reward
know more about the people
rewards past performance can enhance morale
When you go into the marketplace to buy a good or
service you may get a lemon
This is because there is information asymmetry- you
know more about the quality of what you are selling
than the buyer (e.g., you know more about your job
skills than a potential employer)
Consequently, there is the potential for adverse
selection: hiring the wrong person because you did
not have enough information
This is expensive-you could get stuck with a lemon
What sort of workforce does the firm want?
Fits with firm culture, technology, strategy,
Diversity: diverse workforce increases
innovation, less diversity better for
Policies and practices of the firm can signal in
the labor market what type of worker the firm
Compensation practices can help screen workers
Similarly, firms use signals that applicants
send to make decisions (where they go to
Applicant self-selection: Output v. Input
Ideally what you want is for applicants to self-select
Firms use their general reputation through pay, training,
and selection practices
What types of signals would a firm send who pays above
market v. below market?
McDonalds will hire almost anyone; Toyota is hard to get
Thus, it is important that firms send signals of the
type of employees they want
One example of signaling
Output based pay: pay based upon what you
Input based pay: amount of time or effort
spent on an activity
workers to leave
will leave when pay falls
short of next best
more productive workers
will go to A
Incentive compensation signals to potential
employees must be productive or they will not
May discourage less potentially productive
employees not to even want to work for that
External environment influences
Labor market - loose/tight markets affect
abundance of candidates
Legal - legal concerns salient in recruiting.
Types of Labor Markets
Private Employment Agencies
Public Employment Agencies
Effectiveness of Methods
Two ways to judge effectiveness
Does technique generate good candidates?
Does technique generate good employees?
Effectiveness of Recruiting
Newspapers and other advertising generates
Referrals and rehires of previous employees
have best attendance & performance
Informal techniques appear best: employee
referrals, rehires & walk-ins.
Selection is the process of determining which
individuals will staff the organization.
Trying to find people who will best staff the
Includes: interviewing, tests, weighing
education & experience, recommendations
Good Selection Pays Off
25% of firms spend at least $1,000 for
50% - $1000-$5,000.
Most employees don't pay back salary for a
Wrong person can cost 3½X their salary.
How to decide whether they are useful.
I measuring the attribute
test-re-test: give people same test at two time
parallel or equivalent forms: give different tests
that measure the same thing
internal consistency: a single test is subdivided
to see if people respond in the same way.
Inter-rater reliability: do different raters rate
Validity - are you measuring what you
want to measure?
In Selection: Does our selection
instrument predict job performance?
Use statistical techniques to correlate the
score on the test/interview with job
Predictors - personnel
Criterion - variable
used to measure job
Is the payoff from implementing new predictor
Weighs the potential benefits against the
Utility of selection devises depends whether it
improves the quality of individuals selected
over what they would have been had the
devise not been used.
Utility= quantity X quality - cost
Quantity = Number People Selected/Year
Quality = validity coefficient (how useful is the test?)
What proportion of those selected considered
What is good job performance worth?
What is the variation in good & bad job
How selective can you be?
Cost = N(C) What does the selection test cost?
Changes in Cut Score
False positive-test says to hire but
it was a mistake
False negatives-test says not to
hire but would have been good
Raising Cut Score
Most frequently used and most controversial
method of selection.
Other functions: public relations,
organization communicates what it has to
offer the applicant, and can fill in gaps in
However, recent evidence suggests that individual
interviewers may be highly accurate in predicting job
Interviews Unreliable and Invalid
Difficult cognitive task:
Improving Interview Validity
Restrict the use of interviews to the KSAs that
interviews can assess most effectively:
personal relations, sociability & citizenship
Use structure - consistent information from
Job related questions - direct and specific
information about the job.
Behavioral interviews ask about how applicants
have performed jobs or handled problems in the
Situational interviews: provide a scenario typical of
the job and then ask how to handle it
More Improving Interview Validity
Formalize scoring - rating scales on a series
Team approach - several interviewers as a
group interview the applicant. Train the
1. accurately receive information
2. critically evaluate information
3. regulate their own behavior in asking questions.
Used to get person's background &
comparing their strengths and weaknesses
EEOC guidelines recommend against certain
questions with adverse impact.
The questions need to be job related.
Applications were compared with factual
25% listed previous employers that said they were
25% disagreement on reasons for leaving
57% duration of previous employment
72% on salary
Misuse and Bias
Weighted application blanks - scoring of
Weight questions related to job success
Must insure no weights for age, sex and marital
Intelligence tests - yield a single intelligence
Mental ability tests - multiple scores: verbal
work fluency, math, spatial relations.
Relatively high validity
Personality - unique characteristics that
define an individual.
determines individual's pattern of interaction
Personality not related to job performance
except for some situations and for some
tests don't identify dimensions important for job
Multiple hurdle - Each test represents
hurdle and if fails any level then don't get job.
Advantage - inexpensive
Compensatory - all tests given to everyone.
Exceptional performance may offset poor
performance on another.
Advantage - higher validity.
Probably the best way is to try people out
Internal labor markets use to some degree by
not promoting those who are not deemed
Costs: you have to spend resources selecting
Workers may work hard just in probationary
Maybe harder to get rid of employee following the
Credentials as a signal
MBA from a top notch school maybe just
getting in to that school
Signals desirable talents
However, applicants will figure this out and
start getting MBAs
Thus, there is noise and might require
Recruiting & Selection extends beyond just
finding the right skills for the job
Includes signals that you want to send that
may attract and retain certain types of people
Must screen to work out noisy signals