Noe 4th ed Chap005.ppt

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fundamentals of

Human Resource Management 4th editionby R.A. Noe, J.R. Hollenbeck, B. Gerhart, and P.M. Wright

CHAPTER 5

Planning for and Recruiting

Human Resources

Human Resources ManagementMG 6123 – Spring 2013

Professor Marc S. Miller

http://www.poly.edu/



5-2

What Do I Need to Know?

1. Discuss how to plan for human resources

needed to carry out the organization’s

strategy.

2. Determine the labor demand for workers in

various job categories.

3. Summarize the advantages and

disadvantages of ways to eliminate a labor

surplus and avoid a labor shortage.



5-3

What Do I Need to Know? (continued)

4. Describe recruitment policies organizations

use to make job vacancies more attractive.

5. List and compare sources of job applicants.

6. Describe the recruiter’s role in the

recruitment process, including limits and

opportunities.



5-4

The Process of Human Resource Planning

• Organizations should carry out human

resource planning so as to meet business

objectives and gain a competitive advantage

over competitors.

– Human resource planning compares the present

state of the organization with its goals for the

future – Then identifies what changes it must make in its

human resources to meet those goals



5-5

Figure 5.1: Overview of the Human

Resource Planning Process



5-6

Forecasting

• Forecasting: attempts

to determine the supply

and demand for various

types of humanresources to predict

areas within the

organization where

there will be laborshortages or surpluses.

There are three major

steps to forecasting:

1. Forecasting the demand

for labor

2. Determining labor

supply

3. Determining laborsurplus or shortage


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Forecasting the Demand for Labor

Trend Analysis

• Constructing and

applying statistical

models that predictlabor demand for the

next year, given

relatively objective

statistics from the

previous year.

Leading Indicators

• Objective measures that

accurately predict

future labor demand.



Determining Labor Supply

• Transitional matrix: a

chart that lists job

categories held in one

period and shows theproportion of employees

in each of those job

categories in a future

period.

It answers two questions:

1. “Where did people in

each job category go?”

2. “Where did people nowin each job category

come from?



Table 5.1: Transitional Matrix – Examplefor an Auto Parts Manufacturer



Determining Labor Surplus or Shortage

• Based on the forecasts for labor demand and

supply, the planner can compare the figures to

determine whether there will be a shortage or

surplus of labor for each job category.

• Determining expected shortages and

surpluses allows the organization to plan how

to address these challenges.



Goal Setting and Strategic Planning

• The purpose of setting specific numerical goals is to

focus attention on the problem and provide a basis

for measuring the organization’s success in

addressing labor shortages and surpluses.• The goals should come directly from the analysis of

supply and demand.

• For each goal, the organization must choose one or

more human resource strategies.

• Organizations should retain and attract employees

who provide a core competency (what makes it

better than competitors)



Options for Reducing a Surplus

DownsizingPay

reductionsDemotions

TransfersWork

sharing

Hiring

freeze

Natural

attrition

Early

retirementRetraining



As the average age of many workers in skilled trades grows, the coming

demand for workers in many trades is expected to outstrip supply in the

United States. There is a potential for employers in some areas to

experience a labor shortage because of this.



Options for Avoiding a Shortage

OvertimeTemporary

employeesOutsourcing

Retrained

transfers

Turnover

reductions

New external

hires

Technological

innovation



Table 5.2: HR Strategies for Addressing aLabor Shortage or Surplus



Test Your Knowledge

• A public accounting firm of 250 employees

realizes they have a surplus of 15 support

personnel (not auditors). What should they

do?

A. Hire temporary workers

B. Offer early retirement

C. Downsize people in those positions

D. Wait for attrition and implement a hiring freeze

for those positions



Implementing and Evaluating the HR Plan

• When implementing the HR strategy, the

organization must hold some individual accountable

for achieving the goals.

• That person must also have the authority andresources needed to accomplish those goals.

• Regular progress reports should be issued.

•

The evaluation of results should not only look at theactual numbers, but should also identify which parts

of the planning process contributed to success or

failure.



Applying HR Planning to Affirmative Action

• Workforce UtilizationReview: a comparison of employees in protectedgroups with the

proportion that eachgroup represents in therelevant labor market.

• The steps in a workforce

utilization review areidentical to the steps inthe HR planning process.

• The organization must

assess current utilization

patterns, then forecast

how they are likely to

change in the near future.

• If the analyses forecast

underutilization of certain

groups, then goals and aplan will be established.



Recruiting Human Resources

• The role of human resource recruitment is to

build a supply of potential new hires that the

organization can draw on if the need arises.

• Recruiting: any activity carried on by the

organization with the primary purpose of

identifying and attracting potential

employees.



Figure 5.2: Three Aspects of Recruiting



Personnel

Policies

Internal versus

external recruiting

Lead-the-market pay

strategies

Employment-at-will

policies

Image advertising

Several personnelpolicies are

especially relevant

to recruitment:



• Image advertising, such

as in this campaign to

recruit nurses, promotes

a whole profession ororganization as opposed

to a specific job opening.

• This ad is designed to

create a positive

impression of theprofession, which is now

facing a shortage of

workers.



5-23

Recruitment Sources: Internal Sources

• Job Posting: the process of communicating

information about a job vacancy:

– On company bulletin boards

– In employee publications

– On corporate intranets

– Anywhere else the organization communicates

with employees



5-24

Advantages of Internal Sources

1. It generates applicants who are well known to

the organization.

2. These applicants are relatively knowledgeable

about the organization’s vacancies, whichminimizes the possibility of unrealistic job

expectations.

3. Filling vacancies through internal recruiting isgenerally cheaper and faster than looking

outside the organization.



5-25

One in Three Positions Are

Filled with Insiders



5-26

Recruitment Sources: External Sources

Direct applicants

Referrals

Advertisements in

newspapers and

magazines

Electronic recruiting

Public employment

agencies

Private employment

agencies

Colleges and

universities



5-27

Figure 5.3: External Recruiting Sources – Percentage of Employees Hired



5-28

Evaluating the Quality of a Source

Yield Ratios

• A ratio that expresses the

percentage of applicants who

successfully move from onestage of the recruitment and

selection process to the next.

• By comparing the yield ratios of

different recruitment sources,

we can determine which source

is the best or most efficient for

the type of vacancy.

Cost Per Hire

• Find the cost of using a

particular recruitment source

for a particular type of vacancy.• Divide that cost by the number

of people hired to fill that type

of vacancy.

•

A low cost per hire means thatthe recruitment source is

efficient.



5-29

Table 5.3:Results of a Hypothetical Recruiting Effort



5-30

Your Experience

• In your last job search, what was your

experience with a recruiter or other point of

contact before you were offered the job?

A. Lousy, I didn’t take the job

B. Lousy, but I took the job anyway

C. Great, but I didn’t take the job

D. Great, I took the job

E. The experience wasn’t memorable.



5-31

Recruiter Traits and Behaviors

Characteristics of the Recruiter

Behavior of the Recruiter

Enhancing the Recruiter’s Impact



5-32

Recruiter Characteristics and Behavior

True = A False = B

• Applicants respond more positively when the recruiter

is an HR specialist than line managers or incumbents.

• Applicants respond positively to recruiters whom arewarm and informative

• Personnel policies are more important than the

recruiter when deciding whether or not to take a job.

• Realistic job previews should highlight the positive

characteristics of the job rather than the negative.



5-33

Figure 5.4: Recruits Who Were Offended by Recruiters



5-34

Enhancing the Recruiter’s Impact

• Recruiters should provide timely feedback.

• Recruiters should avoid offensive behavior.

•They should avoid behaving in ways that mightconvey the wrong impression about the

organization.

•

The organization can recruit with teams ratherthan individual recruiters.



5-35

Recruiting Exercise (1 of 2)

• You are the regional HR director of the

restaurant chain (e.g., Ruby Tuesday’s or TGI

Fridays) and responsible for recruiting all staff

for the restaurants in your region.

• One of the stores in your region needs to hire

servers.



5-36

Recruiting Exercise (2 of 2)

1. What knowledge, skills, and abilities are

required for the positions you are recruiting?

2. Will your sources of applicants be internal,

external, or both? Explain.

3. What recruiting strategies will you use?

4. What metrics will you use to measure your

success?



5-37

Summary

• The first step in human resource planning is

personnel forecasting. Through trend analysis and

good judgment, the planner tries to determine the

supply and demand for various human resources.• The next step is to determine the labor demand for

workers in various job categories. Analysis of a

transitional matrix can help the planner identify

which job categories can be filled internally andwhere high turnover is likely.



5-38

Summary (continued)

• To reduce a surplus, downsizing, pay reductions, and

demotions deliver fast results but at a high cost in

human suffering that may hurt surviving employees’

motivation and future recruiting.• To avoid a labor shortage, requiring overtime is the

easiest and fastest strategy.

• Internal recruiting generally makes job vacancies

more attractive because candidates see

opportunities for growth and advancement.



Summary (continued)

• Lead-the-market pay strategies make jobs

economically desirable.

• Internal sources are usually not sufficient for all of an

organization’s labor needs. • Through their behavior and other characteristics,

recruiters influence the nature of the job vacancy

and the kinds of applicants generated.

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