Transcript Chapter 5

Chapter 5
Recruiting Applicants
Gaining Competitive Advantage
• “Kentucky Blue” employee referral
campaign—awarded prizes to ees who
recruited new hires
– Hospital met staffing needs
– Cost per hire was $2,400 in previous
recruitment programs
– Cost per hire with “Kentucky Blue” was $837
per hire
Linking Recruitment to Competitive
Advantage
• Five goals:
– Achieve cost efficiency
– Attract highly qualified candidates
– Help ensure that individuals who are hired will
stay with the company (retention)
– Assist company’s efforts to comply with
nondiscrimination laws
– Help a company create a more culturally
diverse workforce
Achieving Cost Efficiency
• Recruitment costs per hire typically equal one-third of a
new hire’s annual salary
• Expenses—advertisement, recruiter and candidate
travel, possible referral or sign-on bonuses, agency or
search firm fees, recruiters’ salaries and benefits, and
manager’s time
• 614 companies reported spending $3.4 billion on
recruitment costs in the last 3 years
• Competitive costs gained by holding costs down, while
keeping productivity levels constant (competitive
advantage enhanced by keeping recruitment costs
down and productivity levels constant
Attracting Highly Qualified
Candidates
• HRM department must ensure that a
sufficient number of qualified candidates
are identified—want the best candidates
– Notifying of job openings—need to locate
those individuals (capture candidates’
attention and stimulate their interest in
applying for positions)
Attracting Highly Qualified
Candidates
• Influencing Job Acceptance Decisions:
– Best candidates will accept job offer (Discuss
Exhibit 5-1 on page 117)
– Candidate’s perception of job attractiveness is
heavily influenced by the nature of the
information given by the firm, how it is given
and how well the applicants are treated
– Recruiter plays key role in attracting
candidates (recruiter behavior is an extension
of organization’s personality)
Attracting Highly Qualified
Candidates
• Candidate views recruiter’s behavior as a
model for the quality of interpersonal
relationships and the nature of supervision
existing in the organization (rudeness and
disrespect for a female candidate)
Improving Retention Rates through
the Use of Realistic Job Previews
• Turnover newly hired employees in the first six
months (overzealous recruiters “oversell”
• RJP-Realistic Job Preview can reduce turnover
by giving candidate a more realistic view
(unfavorable as well as favorable) about the job
and organization
– Some will withdraw from process
– RJPs can reduce turnover by 24%--rresult in annual
savings averaging $271,600
Achieving Legal Compliance
• Organizations can help prevent
discrimination charges by targeting efforts
toward underutilized groups—protected
groups (blacks, Hispanics, or disabled
individuals by placing ads)—discuss
Exhibit5-2
Creating a More Culturally Diverse
Workforce
• Competitive advantage results from a
more culturally diverse workforce (reach
out to seniors, minorities, welfare-to-work
candidates and people from the armed
forces)
– Companies attracting older workers—The
Travelers, Banker’s Life & Casualty,
Honeywell, Motorola and some fast-food
restaurants (Let’s name a couple)
Creating a More Culturally Diverse
Workforce
• Candidates with disabilities—Kreonite ( a film
manufacturer)—by increasing number of
employees with disabilities their turnover
dropped from 32% to 10 to 12%
• Attracting members of underutilized groups is
dependent on organization’s treatment of
candidates during recruitment process
• Lose many because recruiters act rude, boring
obnoxious, full of themselves, incompetent,
barely literate and jerks (females old boy
network or an interview in a hotel room)
HRM Issues & Practices
• Recruitment Planning:
– Identify the Job Opening—waiting for an
employee to turn in their resignation (take
organization a long time to fill the opening)
• 6 to 8 weeks to notify and screen applicants
• 1 to 2 weeks to make a decision regarding a job
offer
• Decision made-candidate must give two weeks
notice
HRM Issues & Practices
• Companies should attempt to identify job
openings well in advance of announced
resignations (plan for openings in the short and
long term)
• Questions to ask:
– Are any new budgeted positions opening soon?
– Is a contract under negotiation that may result in the
need for additional hires?
– What is the amount of expected turnover in the next
several months
HRM Issues & Practices
• Step Two:
– “Do we need to find a new person to fill the vacant
position?”
– Provide overtime to current employees or job
elimination and job redesign (i.e., incorporating the
tasks of the vacant position into currently existing
positions
– Address two issues—to fill with core or with
contingency personnel and if core personnel are used
whether to recruit them internally or externally
Core vs. Contingency
• Core personnel are placed on the
organization’s payroll and are considered
regular full time ees (discuss
“permanent employees)
• Contingency personnel perform work for
the company but are not on payroll
– With a supplier agency and are loaned to the
company on a temporary basis for a fixed fee
(Spherion or Account Temps)
Core vs. Contingency
• Suppliers:
– Labor leasers, temporary employment
agencies and independent contractors
– Leased and temporary work side by side with
core employees often in the same jobs
• Contracts with leased employees run longer than
with temporary employees
• Independent contractors are selected to perform
the entire function (i.e., maintenance work through
a skilled-trades contractor)
Core vs. Contingency
• Bureau of Labor Statistics reported 5.6
million contingency jobs in the U.S.—4.3
percent of total workforce
– 7,000 temporary staffing firms
– In the future orgs will have a very small
knowledge-based full time workforce
Advantages Of Contingency
Personnel
• Flexibility to control fixed employee costs
(increase or decrease workers based on
business conditions)
• HRM burden is relieved—supplier handles
administrative work associated with payroll,
insurance administration, and benefits. Supplier
also screens and hires workers
• Cost Savings—Cost less than core workers due
to overhead costs of payroll and insurance
• Those excel at jobs are offered full time
employment
Disadvantages Of Contingency
Personnel
• Need considerable orientation and training
time regarding company procedures and
policies
• Less loyal and committed to the “host
organization”
• Receive better wages than core
employees for performing the same work
(inequity)
What Types of Situations Should
Contingency Workers Be Used?
• Hard-to-find expertise are required
• Companies are trying to staff offices in
geographic areas far from the main
headquarters
• Trying to staff positions to work on projects
in which high risk factors may jeopardize a
company’s existing workers’ compensation
rates
Internal versus External Recruiting
• Fill with current employees or applicants from
the outside
• Many firms external recruitment is limited to
entry-level jobs
• Those above entry level are filled through
promotions (enhance employee morale and
motivation)—they can advance their careers in
the organization
• Results in…reduced turnover, increased job
satisfaction, and better job performance
Internal versus External Recruiting
• Other advantages of internal vs. external
recruitment:
– Qualifications of internal candidates are well
known to employer
– Recruitment is less expensive
– Job openings can be filled more quickly
internally
– Internal candidates are more familiar with
organizational policies and practices—result
in less orientation and training
Internal versus External Recruiting
• What problems does internal recruitment
bring?
– Some candidates will be rejected (resentful)—
greater feelings of inequity and higher rates of
absenteeism
– Workers promoted to supervisory positions in
units they were already working in—friends
become direct reports
Internal versus External Recruiting
• External recruitment for jobs above entry
level:
– Org wants new ideas and innovations
– No qualified internal candidates apply
– Org needs to increase percentage of
employees within a underutilized group
Internal versus External Recruiting
• Step Three: What types of individuals are
we looking for to fill positions?
– Specify worker requirements
– Deciding whether to target a certain segment
of the applicant population
o Specifying Worker Requirements
o Duties, reporting relationships, salary range for
hiring, and competencies (education,
experience, knowledge, skills, and abilities)
Internal versus External Recruiting
o Deciding Whether to Target Certain
Segments of the Applicant Population
o Recruiting internally—will the job be posted or
should the company select “high potential”
employees and groom them for the position
o Externally—inform all potential applicants or target
certain types (i.e., underutilized groups or
graduates from specific schools that have
exceptionally strong programs (KENT STATE
UNIVERSITY!!!!!)—or top performing ees from
another company—raises ethical questions
Internal versus External Recruiting
• Step Four: Notify the Target Population
– How to notify individuals of vacant position
(i.e., job postings, newspaper ads, campus
interviews, and so forth)
– Job market fluctuates due to economic
conditions—high unemployment a glut of
candidates—the company may want to only
attract the most qualified candidates—must
clearly state job requirements in the
vacancy notification (i.e., “Career Mapper”)
Internal versus External Recruiting
• Step Five: Meet with the Candidates
– Most qualified are brought in for interviews
and other assessment procedures
– Candidate will receive information about the
job and company
Methods of Internal Recruitment
• Computerized Career Progression Systems (e.g.,
AT&T)
– Strengths—candidates found quickly—broad spectrum
– Weaknesses—skills inventory only objective or factual info—no
subjective info (i.e., interpersonal skills, integrity
• Supervisor Recommendations
– Strengths—total discretion to supervisor in selecting the
individual-know capabilities of the individual
– Weaknesses—subjective—subject to bias and possible
discrimination—courts have frowned on this—all potential
candidates to be notified about the position
Methods of Internal Recruitment
• Job Posting—most commonly used approach
to internal recruitment (includes job, salary, work
schedule, and necessary worker qualifications)
– Ees are concerned how they are treated during
the interview process
– Strengths—all candidates notified, enhances
probability that firm’s most qualified employees will be
considered for the job. Additionally—employees
become responsible for their own career development
and enables an ee to leave a bad work situation
Methods of Internal Recruitment
• Job Posting—
– Weaknesses:
• Position open for an extended period of time—a
long process
• System may prevent supervisors from hiring
person of their choice
• Some ees hop from job to job with no clear
direction
• Bid is rejected they may become alienated from
the organization
Methods of Internal Recruitment
• Career Development Systems—”fast
track” or high potential employees
– Strengths—top performers will remain with
the org and system ensures someone is
always ready to fill a position
– Weaknesses—ee not selected for grooming
may become disenchanted—leave even
though they may be a good ee—just not top
tier. Selected ee may become frustrated if
expected promotion doesn’t materialize
Methods of Internal Recruitment
• Employee Referrals: identify friends and
associates—ee receives a bonus
(Remember the University of Kentucky?)
– Strengths—15% of workers through
referrals—remain longer with the company
and are better performers. And very cost
effective
– Weaknesses—barrier to EEO
Methods of Internal Recruitment
• Applicant-Initiated Recruitment—
unsolicited resumes and applications
– Strengths—efficient and low cost and
candidates are likely to be highly motivated
– Weaknesses—timing problem—resumes on
file for a long time and they may have found
other employment
Methods of Internal Recruitment
• Help Wanted Advertisements—best known
way to identify candidates (geographic
recruitment area)—local area use newspaper,
TV, radio, or billboard—broader audience—USA
Today or Wall Street Journal
– Strengths—reach large audience in a relatively short
period of time. Ensures a large applicant pool—
members of protected groups apply
– Weaknesses—people hired this way don’t perform
their jobs as well and are absent more frequently.
Also fails to reach most qualified candidates—
successful people are not currently looking for work.
Also the problem when too many people respond
Methods of Internal Recruitment
• Employment Agencies and Search firms
– Public agencies (OBES)
– Private Employment Agencies
– Executive Search Firms
• Campus Recruiting
– Strengths—utilized to fill entry level positions—50% of
all managers and professionals with less than 3 years
experience were recruited on campus
– Weaknesses—timely and costly--$1,500 to $6,000
cost per hire. Slow because orgs must define needs
9 to 11 months early
Methods of Internal Recruitment
• On-Line Recruiting—HotJobs.com or
Careerbuilder.com
– Strengths$26 billion dollar business—holds
110 million job listings—much faster and
reaches a much larger audience
– Weaknesses—very expensive Job Options
charges $5,370 per year for unlimited
access—mostly used for regional and national
searches. And number of candidates
generated can be an administrative burden
What is the Right Method of
Recruiting?
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Type of job to be filled
How quickly job needs to be filled
The geographic region of recruitment
The cost of implementing the recruitment
method
• Whether the method will attract the right
mix of candidates from an EEO
perspective (Discuss Exhibit 5-4 page
135)