Recruitment: Getting the Right People

To be effective, recruitment strategies should be linked to Human Resource Planning. Human Resource Planning (HRP) compares an organization’s workforce abilities to its future demands. organizations that do not do Human Resource Planning may experience labor shortages or labor surpluses that result in layoffs.

One of the main HRP activities is estimating the organization’s labor demand – how many employees the organization will need in the future. To correctly forecast its labor demand, organizations should consider variables such as the possibility that its labor requirements may increase as demand for its product increases, but increased productivity may offset some labor demand. Similarly, the organization should forecast the labor supply as part of its HRP. For example, if an organization estimates that its demand for workers will increase but the labor supply will decrease, then the organization can take appropriate actions to avert problems. It can increase what it pays to workers as a way of being more effective, tap overlooked pools of potential employees or outsource some activities, for instance.

Many organizations conduct job analyses as part of Human Resource Planning. A job analysis is the process of identifying and describing the aspects of a job. Human Resource departments then can use job analyses to communicate a job’s tasks, duties and responsibilities and to screen job candidates.

Organizations also must determine how many candidates they need for each position. Yield ratios are the number of job offers it takes before someone accepts. For example, an organization may find that, on average, it has to offer a job to three people before one accepts.

Organizations must recognize legal factors that may influence their recruitment efforts. In many industrialized nations, laws prohibit discrimination in hiring decisions or require organizations to recruit from protected classes such as people with physical disabilities. As part of recruiting practice, organizations should learn how the specific legal considerations of their country constrain the recruiting process.

In Europe, the European Union adopted a framework for equal treatment in employment. The directive prohibits discrimination in employment based on race, religious affiliation, sexual orientation, physical ability or age. The new directive could alter the composition of what remain largely homogenous management teams. A team working for Newsweek International could not find one large organization with a minority CEO in 2002, and few with a minority officer at any senior level. Member States have until December 2003 to change their laws with regards to religion and sexual orientation and until 2006 for physical ability and age. The law includes provision for enforcement, unlimited compensation and sanctions against employers.

In the United States, federal law requires that government employers and government contractors with more than 50 employees file an af organizationative action program that compares the number of minorities and women it employs to the available labor market. Organizations sued for discrimination also may face a consent decree mandated by a federal court that details steps the organization must take in recruiting to remedy discriminating practices.

The goal of recruitment is to attract qualified job candidates. Identifying the sources most likely to contain qualified candidates saves time and money.

Current employees: Some organizations post job openings internally before seeking applicants from outside. This process allows current employees the chance to move up in the organization or into jobs they would enjoy more.

Referrals from employees: Research has found that employees hired through referrals from existing employees tend to be more loyal and more satisfied. But an organization may become too homogenous if employees only refer people like them.

Former employees: Organizations sometimes rehire employees who were laid-off or worked for the organization temporarily and demonstrated potential. Many organizations use temporary workers hired through temporary help agencies to meet labor needs as project/programme purpose ebbs and flows and eventually hire some of them full time.

Print advertisements: Newspaper and trade magazines are used by employers to advertise positions locally, nationally or internationally.

Internet advertising and career web sites: The Internet allows organizations to advertise jobs globally through relatively inexpensive online advertisements. Many organizations also post positions on their own Web sites and job-search sites.

Employment agencies: Many organizations use employment agencies – often nicknamed headhunters – to recruit and screen candidates for a job.

College recruiting: Many organizations have recruiting programs that target specific colleges or certain degrees, both undergraduate and graduate. Recruiting employees at colleges and universities is equally effective for undergraduates and graduates. However, graduate project/programme purpose schools represent an almost ideal recruiting environment. MBAs are an elite pool of experienced talent, trained in general management and specific functional areas.

Internal recruitment refers to individuals who already work in the organization but are given the opportunity to apply for a vacant job within the organization. When positions become available, organizations need to decide whether it will fill the position internally. Employers also should decide whether only employees who work in the specific group will be considered or whether cross-functional mobility will be considered (such as from finance to marketing departments).

In some cases, organizations choose to promote from within because of their familiarity with people in the organization; also familiarity with procedures and policies gives them an edge. Other times, organizations opt to transfer employees – without promoting them – as a way of providing a broader range of experience. For management trainees, job rotation exposes these up-and-coming employees to various parts of their organization. Job rotation also can be used to provide employees in high-stress jobs with a change of pace and prevent burnout. In addition, recalling or rehiring employees who have retired will become more common as global demographics change.

Recruitment of outside talent occurs when the organization goes into the external labor market to fill a vacancy. External recruitment may occur at any levels, from entry-level to senior-level positions. Every project/programme purpose will find it necessary to engage in external recruitment. Even organizations that boast of opportunities for internal promotion find it necessary to recruit from the outside to replenish voluntary attrition and retirements. At minimum, these organizations recruit externally to fill lower-levels job ladders as incumbents move into higher-level positions.

organizations that seek the best person typically look both internally and externally for job candidates. Several multinational organizations have chosen CEOs who not only are from outside of their organizations but also outside of their industries. For example, IBM selected Louis Gerstner Jr., former CEO of RJR Nabisco. Sometimes it is more economical for organizations to hire specialists from outside rather than incur the expense of training current employees for positions that require new skills. effective organizations seek individuals who perform at high levels almost immediately after joining.

organizations should not rely on only one source of potential candidates. For some vacancies, the strategy will be to hire from the available labor supply in the immediate vicinity and traditional recruiting methods work well. Most clerical and semi-skilled jobs are filled locally. For other positions, the strategy often involves looking nationally or internationally – especially if the position is very specialized.

Organizations will need new methods for recruiting as the 21^st century progresses. In many countries, the labor force is shrinking and employment patterns are changing because of declining birth rates and increasing life expectancies. For example, the workforce will decrease by 2% annually in Italy and by .3% annually in Japan, making older workers a vital resource. Women today represent more than 40% of the global workforce. Executives should look at nontraditional recruiting as a way of tapping the varied perspectives offered by members of different groups and a way of meeting labor needs. Diversity among decision-makers also helps organizations identify new niches, improve beneficiary service and reflect beneficiaries.

Nontraditional labor pools include welfare recipients who are transitioning to work, retirees who seek second careers and workers from foreign countries. Some members of these groups may require training, but organizations may be able to partner with the government or nonprofit organizations if the organization doesn’t want to or can’t provide training.

organizations can recruit well-trained but underrepresented groups at conferences for women, minorities and retired executives. In the United States, for example, the National Black MBA Conference provides new opportunities for organizations to connect with highly-motivated and experienced graduate project/programme purpose students.

Well-managed organizations not only forecast the numbers and types of job vacancies in the future, but they also estimate approximately when they will occur. In situations such as college recruiting, which occurs in well-defined cycles, organizations also have the option of either being an early or late entrant into the recruiting process. Most undergraduate and graduate school students consider job offers as they are received, so organizations improve their chances of attracting high-potential students by entering the recruitment process early.

HR departments can review time-lapse data, which shows how much time on average elapses between decision points in the recruitment process. Historical data from the organization’s recruitment process may show r�sum�s begin arriving 10 project/programme purpose days after an advertisement appears. On average, it may take the organization three days to invite applicants in for interviews, eight days to arrange interviews, five days for the organization to choose someone 14 days for the potential employee to decide whether to accept the job, and 30 days for the new employee to begin working. In this example, the data indicates that vacancies should be advertised 70 days before the position is expected to be filled, if the organization wants to avoid downtime caused by having no one in a position.

Looking at time-lapse data and yield rations, mentioned earlier, an organization can create more accurate charts that show when specific numbers must be achieved such as the number of r�sum�s received and when decision should be made. It also helps organization to adjust the recruitment process if they realize that they are behind schedule in filling positions by changing the geographic scope of their recruitment effort.

Expectancy theory says people tend to do those things that are rewarded. It suggests that job applicants will pursue jobs whose rewards they perceive as having personal or professional value. Organizations usually first communicate to potential employees through messages that appear in postings and advertisements. Employers need to use clear messages about the job requirements, responsibilities and rewards so they attract appropriate applicants and not unqualified applicants.

Many organizations use a “shotgun” approach to communicating the attributes of a job to potential managerial and professional applicants because they are unsure what job attributes are the most attractive to potential candidates. After all, job attributes play a significant role in whether potential employees pursue and accept jobs, according to research. Blue-collar employees value job security, for example. In contrast, managerial and professional employees value opportunities for promotion. The content of the message should contain information about whatever job attributes most likely appeal to the level of applicants sought.

Employers often have assumed that it is to their benefit only to tell a job applicant about the positive aspects of the organization and job. This sugarcoating is controversial. Numerous studies have found that employers should not sugarcoat jobs. Instead organizations should provide what is known as realistic job previews – positive and negative information that is accurate. Realistic job previews increases the number of recruits and reduces turnover by reducing overly optimistic expectations, according to research. Realistic job previews also tend to increase organizational commitment, job satisfaction and performance.
9. The Applicant’s Perspective

To attract applicants, employers should understand what factors influence job candidates and how they decide whether to accept a job offer.

Self-esteem affects how individuals undertake job searches. Applicants with high self-esteem have a stronger belief in their own competency. Individuals with a strong need for achievement usually undertake more intensive job searches than other applicants do. Similarly, job seekers with high self-esteem apply for more jobs than originally had planned and more than job seekers with low self-esteem.

By young adulthood, most job applicants have narrowed their choice of occupations to one or two options. Economic factors, psychological factors such as needs, interests and abilities, and sociological factors all influence people’s decision-making when selecting an occupation. Individuals ultimately choose an occupation when they find a job that most closely and clearly meet these needs.

After people identify an occupation that meets their needs, they begin looking for an organization that hires people for that occupation. In general, job seekers do not identify all their options and simultaneously evaluate them. Instead, they are far less systematic and evaluate opportunities sequentially. If a job meets an individual’s minimum criteria, the person accepts the offer. If not, the person rejects it. New college graduates are the exception because they often receive multiple offers simultaneously. One key criterion for all applicants is their non-compensatory reservation wage, the minimum pay necessary to make the offer acceptable. After the reservation wage is met, individuals switch to a compensatory approach, evaluating tradeoffs between different job attributes.
10. Evaluating the Effectiveness of Recruitment Sources

Employers can evaluate the effectiveness of different recruitment sources by tracking how long employees recruited from each source stay with the organization.

Recruiting costs can be analyzed in many ways. An organization should determine the most cost-effective recruiting method for each situation. For example, organizations incur different expenses when they pay cash awards to employees who refer successful applicants than when they buy advertisements. One useful measure is calculating the average cost per employee hired. A more sophisticated way is a utility analysis, which compares recruitment-related expenses to the economic benefits accrued to the organization through an improved recruitment process, better employee retention and higher levels of performance.

Line managers can increase the HR department’s effectiveness by providing feedback on the quality of applicants from different recruitment sources. Line managers can create spreadsheets to accumulate data that can be analyzed by the HR department.

External recruitment places a significant role in locating knowledge workers and may occur at any level. The goal of recruitment is to attract the most qualified job candidates. The organization can be reactive in its recruiting and wait for resumes to arrive, or it can have a strategy to identify a pool from which it will select knowledge workers with the potential for creativity and innovation desired by the organization.

Identifying the sources most likely to contain qualified knowledge workers saves time and reduces expenses. Research has found that employees hired through referrals from existing employees tend to be more loyal and more satisfied. However, an organization may become too homogenous if employees only refer people like themselves. Many organizations also hire for permanent positions gifted employees who initially worked for the organization temporarily. For example, some new economy organizations hire knowledge workers as consultants or on a free-lance basis and then offer full-time jobs to the most dazzling.

In recruiting high-potential knowledge workers for lower-level positions, one common practice is for organizations to support research programs at key universities in hopes of having an �inside track� for identifying promising students working with well-known research professors. This relationship frequently leads to summer internships for such students and long-term employment if the student proves to be a good fit with the organization. Another technique is to have well-regarded knowledge workers visit their alma maters periodically to create a pipeline that keeps the organization visible within engineering, management and science departments at key universities.

Our research suggests that three factors significantly affect the success in attracting knowledge workers. First, the salary must adequately compensate them for their abilities. Not recognizing their individual value will drive them away. In fact, some scholars have argued that in the future knowledge workers such as exceptional software engineers may have agents who negotiate their employment packages just as basketball players today do. Second, individually tailored compensation packages affect the organization's ability to both attract and retain knowledge workers and provide long-term incentives for sustained contribution to the organization. Finally, knowledge workers often seek autonomy and freedom at work.

1. Eleanor is working through a process to ensure her organization has the right number of employees with the right skills to meet its goals in delivering services and products to its beneficiaries. Eleanor is engaged in:

2. A chain of apparel stores is forecasting its need for managers. The chain has 112 managers, and it experiences 25% turnover in a year. They will need _____ new managers next year:

5. The best recruitment source, one which tends to result in attracting employees who experience greater loyalty, tenure and job satisfaction than other recruiting sources is:

7. A organization can recruit externally or internally when filling a position. Hiring an external candidate over an internal candidate has the advantage of:

d) providing significant motivation to the existing employees seeing someone new come into their department.

8. The yield ratio at The XYZ Co. is 6:1. How many offers will The XYZ Co. need to make in order to fill 80 positions?

(#3) Matching the Columns. Match the correct definition with the word or phrase.

� Recruitment strategies should be linked to Human Resource Planning, which compare an organization’s workforce abilities to its future demands.

� Internal recruitment refers to individuals who already work in the organization but are given the opportunity to apply for a vacant job within the organization. External recruitment occurs when the organization looks outside the organization to fill a vacancy.

� Human Resource Planning not only forecasts the numbers and types of job vacancies in the future, but it also estimates approximately when they will occur.

� Organizations should provide what is known as realistic job previews – accurate information about the demands of the job, the organization’s expectations of the jobholder and the work environment.

1.) The labor supply for an organization is simply how many workers are available with the required skills to meet organization needs.

2.) To forecast labor demand and supply, a organization must have historical staffing data.

3.) Former employees are generally a poor choice for rehiring because of resentment that they may hold against the employer.

4.) The appropriateness of recruiting sources can be evaluated by the type of job to be filled, the state of the economy, or the cost of using the source.

5.) The recruiting source most likely to produce applicants with realistic expectations of the job is referrals from current employees.

6.). Recruiting employees at colleges and universities is more effective for undergraduates than for graduates.

7.) Ethan is considering hiring a new line manager. He analyzes the satisfaction of the present employees in his organization and determines that current employees don’t feel they have many opportunities for advancement, and he has a small budget for recruiting. The best option for Ethan would be to recruit internally.

8.) organizations that recruit externally often suffer from a lack of innovation.

9.) The most important way to establish essential characteristics needed to perform a job well is the job analysis.

10.) In human resource planning the answer to the question “how many candidates should we recruit?” comes from the yield ration calculated in the forecast.

Ian Black, “EU outlaws the workplace sexists in Brussels,” The Guardian, April 19, 2002: 18.

Rana Foroohar , “Race in the Boardroom; A Newsweek survey of organizational Europe finds plenty of confusion about the Continent's changing identity – just as new laws are about to require more clarity,” Newsweek International, Feb. 18, 2002.

Luis R. G�mez-Mej�a, “Chapter 5: Recruiting and Selecting Employees,” Managing Human Resources, �2001 (ISBN 0-13-011333-6)

Herbert G. Heneman III et al, “Chapter 9: Recruitment,” Personnel/Human Resource Management, �1989 (ISBN 0-256-06929-8)

Randall S. Schuler and Vandra L. Huber, “Chapter 4: Recruitment,” Personnel and Human Resource Management, �1990. (ISBN 0-314-56277-X)

Human Resource Planning: The process an organization uses to ensure it has the right amount and the right kind of people to deliver a particular level of output or services in the future.

Internal recruitment: Individuals who already work in the organization but are given the opportunity to apply for a vacant job within the organization.

Job analysis: The process of identifying and describing the aspects of a job.

Realistic job preview: Realistic information about the demands of the job, the organization’s expectations of the jobholder and the work environment.

Recruitment: The process of identifying, screening and attracting desirable job candidates for organization positions. The outcome of recruitment is a pool of qualified candidates for a vacant position.

Time-lapse data: Shows how much time on average elapses between decision points in the recruitment process.

� To learn factors involved in creating and evaluating recruitment strategies.

1) From a manager’s perspective, what are some stumbling blocks to having a successful recruitment program?

The potential for errors exists in any program, but they can be especially costly in recruitment programs. Research has found that organizations lose desirable applicants when the organization fails to make an immediate post-interview follow-up or to maintain contact with the candidates over time. Delays between the interview and the final decision also cause applicants to drop out or move on to other opportunities. Historically, this trend has been found particularly among desirable minority applicants. To avoid these problems, organizations should establish procedures to manage applicants and paperwork long before seeking applicants.

2) I understand that the recruitment activity is supposed to attract the right people at the right time to the organization within legal limits, but what are some more ways of assessing recruitment?

Recruitment activities can be assessed by both qualitative and quantitative measures. Qualitative measures include how well the personalities of the applicants match the organization. Quantitative measures include short- and long-term costs of activities. For example, a general rule of thumb is that recruitment programs need overhauling if an organization spends more than two-thirds of its recruiting budget on individuals who never join the organization. The following is a range of other criteria to consider.

3) You mentioned using job analyses as part of the recruitment process. Why is a job analysis important?

Job analysis is very important to an organization because it is the job analysis that provides the foundation information for the job description and job specification, which in turn are critical stages in the recruitment and selection of staff.

A job description describes the activities performed on a job, and, as we have stressed, is a key part of the recruitment and selection process. From the job analysis, job relevant training programs can be developed because information about skills and other requirements to perform a job will be included. For more background on this you might consult with the professional staff of the HR Department.

Recruiting and Retaining Outside Talent

Monopoly organizations in general, and monopoly utilities in particular, have a poor track record of retaining the employees they recruit from outside the utility sector of activity. A recent study in the United States indicated that over fifty percent of the managers and executives hired by utilities from outside organizations/industries left the utility within two years. Historically, part of the reason for this is because utility cultures can be so difficult for outsiders to understand and adapt to. Outside executives often comment on how mysterious and complex utilities tend to be, how slow moving and how resistant to change.

The transition from monopoly to competition presents many challenges for a utility embedded in the old culture. Recognizing the necessity of recruiting and retaining highly qualified personnel is one such challenge. There is no guarantee that an outside hire is the right person to help the utility move successfully into the future. Nonetheless, it is a serious loss when the utility identifies and hires the right outside employee – only to lose that employee because of culture clash or other reasons which have little or nothing to do with the opportunities of the position itself.

Recruitment and retention of key outside staff are universally regarded as critical determinants of a successful organization in a effective environment. This Module will review the experiences of successful organizations in recruiting and retaining the employees they really want. It will also examine the steps that executives of the organization can take to motivate, protect and develop outside hires. The challenges for the organization in acquiring and retaining outside talent consist of a series of discrete steps: recruitment, selection, socialization and retention. The organization that successfully navigates through each of these steps is well on its way to achieving success in its markets.

I. Introduction----------------------------------------------------------------------------- 1

II. The Human Resources Management (HRM) Framework for Recruiting and Retaining Outside Talent 4

A. Strategy ---------------------------------------------------------------------------- 5

B. Administration ---------------------------------------------------------------------- 6

C. Change------------------------------------------------------------------------------ 6

III. Recruitment and Selection--------------------------------------------------------------- 8

A. Developing a Pool of Candidates---------------------------------------------------- 9

1. Recruiting at project/programme purpose Schools – the MBA Phenomenon------------------------- 10

2. Recruiting Talent from Other organizations----------------------------------------- 11

3. Use of Temporary Employment Agencies---------------------------------------- 12

4. Outsourcing of Functions-------------------------------------------------------- 12

IV. Selecting from the Pool------------------------------------------------------------------ 14

A. The Selection Interview-------------------------------------------------------------- 14

B. Selection Tests---------------------------------------------------------------------- 15

V. How a organization can Facilitate New Employee Socialization----------------------------- 16

Retaining Talent--------------------------------------------------------------------------------- 17

A. The Five R’s of Managing Knowledge Employees: A Case Study------------------- 17

B. Compensation----------------------------------------------------------------------- 19

1. Employee Stock Plans----------------------------------------------------------- 20

2. Variable-Pay Plans-------------------------------------------------------------- 20

3. Competency-Based Plans------------------------------------------------------- 21

C. Work Environment------------------------------------------------------------------ 21

1. Empowerment through Participative Management and Goal Setting--------------- 21

2. Managers as Coaches----------------------------------------------------------- 22

3. Performance Evaluations--------------------------------------------------------- 22

4. Training Opportunities----------------------------------------------------------- 23

Assignments------------------------------------------------------------------------------------- 24

Bibliography------------------------------------------------------------------------------------- 26

Glossary----------------------------------------------------------------------------------------- 27

Questions & Answers--------------------------------------------------------------------------- 28

II. THE HUMAN RESOURCES MANAGEMENT (HRM) FRAMEWORK FOR RECRUITING AND RETAINING OUTSIDE TALENT

Bringing outside talent into a organization should represent a required core competence of every senior manager in the effective organization. organizations regularly fail in the marketplace because senior managers treat recruitment and retention of key personnel as inconsequential matters. Or, they view recruitment and retention as the responsibility of the HRM Department, expecting it to take care of these matters. These approaches are obsolete, representing inadequate views of the importance of an organization’s human resources and how the organization can succeed in a effective environment.

We will begin by reviewing the human resources management framework of a organization to facilitate the recruitment and retention of outside talent.

A major challenge for successful organizations is to be able to attract, assimilate, develop, compensate and retain a competent and knowledgeable workforce. Having a knowledgeable workforce, the “intellectual capital,” represents a effective advantage in today’s global and constantly changing environment.

Every sizeable organization has a Human Resources Department (HR Department), although not necessarily by that name. Personnel Department or Employee Relations Department are other widely used terms for the same set of functions. Irrespective of their names, quality HR Departments play a key role in employees’ work and career lives, as well as in achieving strategic project/programme purpose objectives. HR Departments typically handle recruitment, selection, training and career development, and retention, as well as issues of performance evaluation, compensation and discipline. In government organizations and in organizations with a monopoly culture, the roles and functions of the HR Department are well defined and extensive. Its role is generally viewed as autonomous from the roles of line managers. More recent trends in human resources management demonstrate the need for a mutually supportive and synergistic relationship between the HR Department and the line managers who are responsible to ensure the performance of the organization.

The modern concept of the HR Department can be seen in the most successful organizations in the effective market economy. In the monopoly organization, the HR Department is directly responsible for many of the core HR functions such as decisions regarding recruiting, selecting, training, compensation levels and discipline. Line management is often in the position of having to cope with the results of HR Department actions, having little if any direct input.

In the effective organization, the Human Resources Department and project/programme purpose unit managers become partners. The HR Department provides expert knowledge and advice and administers HR activities. At the same time, responsibility and accountability for the performance of the human resources of the organization become direct responsibilities of the project/programme purpose unit management. The practical meaning of this shift is that decisions about core human resource management functions are brought into the project/programme purpose unit. Line managers become decision-makers about recruitment, selection, career development, compensation and the like.

Does this mean that the HR Department becomes less important than it was during the monopoly? No, quite to the contrary, the HR Department will become more important than previously. The HR Department becomes more results and performance driven. Not only will the HR Department be expected to contribute to organization profits, but it will be expected to be able to demonstrate the contribution that it makes to profitability. HR professionals will become partners with the line managers, who bear ultimate responsibility for organization results and profits. Top leaders of the most successful organizations have often stated that human resources management is too important to be left to HR specialists alone. For human resources management to be successful, general managers must be involved.

[Notes to learners: read David Ulrich’s article, “A New Mandate for Human Resources,’’ in Harvard project/programme purpose Review.]

The proactive roles of the Human Resources Department in the effective organization are strategy, administration and change. Each of these roles will be explained.

The Human Resources Department staffs and coordinates the strategic planning activities of the organization. This brings the HR Department directly into the organization process where decisions get made about the project/programme purpose goals of the organization as a whole. Human resources professionals can perform a comparable role at the project/programme purpose unit level. In addition, HR professionals will be skilled at integrating the strategic components of the organization and translating them into the specific HR plans and actions required for implementation. HR professionals also play a major role in the process of culture change, proactively designing state-of-the-art human resources policies.

Human Resources Departments have always carried a large responsibility for maintaining information about the organization’s human resources. In most organizations, this responsibility represents a major and complex challenge of record keeping and information systems management, involving employee records, meeting legal requirements, facilitating benefits and payroll, and so forth. Unfortunately, the perception of many line managers has been that HR Departments are primarily involved in record keeping. Maintaining accurate and complete records on a organization’s human resources is an important function in any organization. Being negligent or ignoring tasks related to record keeping can result in major costs and inefficiencies for the organization.

During the transition from monopoly to competition, human resource professionals can make a major contribution by serving as change agents; they can facilitate the transformation of the organization culture by communicating change and by creating ways to enable change. HR professionals should also be highly connected with employees and be attuned to their fears and concerns. In crucial and highly constructive ways, the HR professionals can serve as the representatives of front line employees when decisions affecting their work, careers and jobs are made. Maintaining a high performance workforce in the effective project/programme purpose environment is the major challenge faced by all organizations. The HR Department and its professional staff are vital elements of this effort.

At some point, every organization has to go to the external labor market to bring new talent into the organization. The HR Department and line management are the two poles in any project/programme purpose organization, around which most of the action regarding quality and quantity of staff revolves. In the monopoly organization, the HR Department tends to play the dominant role. In these organizations, the Human Resources Department often has sole responsibility for recruiting and retaining talent. In organizations operating in a effective environment, the relationship between the HR Department and line management in recruitment and retention of talent changes fundamentally.

The two boxes below summarize the prototypical style of the HR Department in the two kinds of work organizations.

In the monopoly organization, HRM functions tend to be quite predictable and uniform throughout the organization. The HR policies and rules tend to be spelled out in writing and in great detail. These policies and rules are perceived as rigid. In practice, outside talent comes into the organization directly from high school or university. The HR Department has the dominant role for managing the recruitment of outside talent. Once hired, these employees grow up with the organization, and, in most cases, the new employees expect to remain with the organization until retirement. Promotions and salary raises are fairly predictable, even if not rapid. Although few of these organizations have a formal policy of lifetime employment, in practice it is almost assured.

[Notes to learners: required reading in Module 3, Building Trust with Front Line Employees.]

In the effective organization, HRM functions become distributed between the Human Resources Department and line managers. Strategic management of human resources becomes a powerful tool to make the organization nimble and efficient. Until recently, “a leap of faith” was required for anybody to believe that management of human resources could have a large effect on the bottom line. There is a growing and high-quality body of empirical research that demonstrates that HRM policies and practices have an impact on organizational performance. In the effective organization, HRM policies tend to be flexibly written and flexibly applied. A central goal of HR policies should be to attract and retain a talented, highly committed, highly productive workforce. This way the organization can succeed by satisfying its beneficiaries and achieving its financial goals and obligations to shareholders and other stakeholder groups.

III. RECRUITMENT AND SELECTION

Recruitment and selection are analytically distinct processes, although they are generally sequenced closely together. Recruitment can take place within the organization or from the outside. Internal recruitment refers to individuals who already work in the organization but are given the opportunity to apply for a vacant job in another unit of the organization. Internal recruitment may involve a promotion or it can be a lateral move.

In this study unit, we will be concerned with recruitment of outside talent. This occurs when the organization goes into the external labor market to fill a vacancy. Outside recruitment may target all levels, from entry-level positions to very senior positions. Every project/programme purpose will find it necessary to engage in external recruitment. Even organizations that pride themselves on providing opportunities for promotion from within, will find it necessary to recruit from the outside to replenish – at the very minimum – the lower levels of job ladders as vacancies develop when incumbents move into higher level positions.

The particular culture of a project/programme purpose organization will have a large impact on its recruitment and selection strategies. There is a clear difference among organizations emphasizing promotion from within and organizations seeking the best-qualified person for every vacancy. The organization that emphasizes promotion from within generally recruits in the external labor market only to fill vacancies at the entry levels. The organizations that emphasize the best person will be more likely to look both to internal (i.e., within the organization) and external (i.e. external to the organization) sources for candidates whenever a vacancy occurs.

Not surprisingly, organizations that have a monopoly culture are more likely to adhere to a promotion from within policy than are the organizations characterized by a market culture.

The effective organization relies on being able to attract and retain talented individuals who can perform at a high level almost immediately after joining the organization, and who will also be motivated to keep abreast of changes in the environment and in his/her field of expertise. The challenges facing these organizations are to identify the pool of talented individuals and then to successfully compete with other organizations to attract them. effective organizations typically hire employees from outside to fill vacancies at all levels of the organization.

A. Developing a Pool of Candidates

Where should a organization go to find potential candidates for employment? In the effective organization, the responsibility for identifying the skills and background desired to fill a particular vacancy normally rests with the line manger, working together with the HR Department. The line manger is in the best position to know exactly what the requirements of the job are. Effective line managers will work closely with the professional staff of the HR Department to prepare the job description and other documentation which form the basis for the development of a recruitment strategy.

Development of a recruitment strategy is an essential step. organizations should not rely on only one source of potential candidates. Nor should the recruitment phase of the process be concluded until there are enough individuals in the pool so that relevant comparisons of qualifications can be made. Without a predetermined recruitment strategy, the tendency is to accept the first candidate who comes along that meets the minimum job requirements.

Well-known sources of recruitment in Western countries include placing advertisements in newspaper and journals, government and privately sponsored employment agencies and recommendations from employees. All of these sources can make important contributions to developing a pool of candidates for selection. The HR Department is in a good position to organize and conduct the recruitment effort. There is no need to establish a precise number of candidates that should be in the candidate pool. The test of adequacy should lie in the confidence that the pool has enough qualified applicants so that when the selection is made, the candidate will provide the high quality performance that required outside recruitment to begin with.

For some kinds of job vacancies, the recruitment strategy will be to fill the vacancies from the available labor supply in the immediate vicinity of the office or plant where the job will be performed. In these cases, a strategy of relying on advertisements in the local newspapers, or the local employment agency, or even word of mouth, might be a sound recruitment strategy. Most clerical, semi-skilled and craft jobs will be filled from the pool of talent available in the local community. For many other kinds of vacancies, the recruitment strategy will require looking regionally, nationally or even internationally. A prominent example of where a national or international recruiting strategy is common is in filling professional and other job vacancies that require a high level of university or technical education.

In modern effective organizations, particularly those with an international perspective, much effort is exerted to recruit graduates with the MBA degree, especially those who graduate from one of the elite training grounds for MBA’s in Europe and North America.

It is a fact of life that in the world of effective organization, professional employees and employees on the managerial track change organizations several times in a career. This pattern may be most pronounced in the United States, but studies indicate that it is rapidly gaining momentum in most of the advanced industrial countries.

We will consider several of the leading strategies used by organizations in the effective environment to obtain the most qualified individuals possible to provide high levels of performance in the professional and managerial ranks.

1. Recruiting at project/programme purpose Schools – the MBA Phenomenon

Leading effective organizations increasingly recruit at the best-known graduate school of project/programme purpose in Europe and North America. Examples of such schools are INSEAD in France, The London project/programme purpose School in England and Bocconi in Italy. In the United States there are hundreds of universities that award the MBA, led by such private universities as Harvard, Stanford and Columbia. A number of public universities also have well-known MBA programs, including the University of California campuses at Berkeley and Los Angeles and the University of Michigan. During the past 30 years quite a large number of students from Italy and other European countries have attended MBA Programs in the United States.

project/programme purpose schools, such as the ones mentioned above, represent an almost ideal recruiting environment. MBAs represent an elite pool of managerial talent, trained not only in general management, but also in different functional areas such as marketing, finance, accounting, operations management and human resource management. Most institutions that offer the MBA will require four or five years of work experience as a prerequisite for admission into the program. Admission to an elite MBA program is highly effective. One advantage of recruiting at elite project/programme purpose schools is that the organization does not need to be concerned with the initial screening process. In all likelihood, all of the students will be highly intelligent, ambitious and eager to make a mark in the project/programme purpose world. Recruiting at a project/programme purpose school is both economical and efficient. MBAs have relevant work experience and state-of-the-art training in management and key project/programme purpose disciplines. The MBA degree is highly practical, preparing graduates to immediately perform and contribute to the organization. They bring to the organization leading edge management and project/programme purpose knowledge.

project/programme purpose schools generally have dedicated career centers. The staff of these centers will manage the recruitment process (sending out resumes, arranging interview appointments and the like) and develop the relationships with recruiters. A class of MBA graduates represents a group of highly qualified potential employees looking for challenging career opportunities. It becomes much more difficult to identify the same talent, once it becomes diffused in diverse, geographically separated, organizations. The recruitment process at a graduate school of project/programme purpose is two-staged, summer internships and full-time employment. Recruiters come to campus and conduct interviews with MBA students. It is valuable for organizations to forge relationships with project/programme purpose schools and to develop an alumni pool, which will be very helpful in conducting future recruiting efforts.

Although employees at all levels change jobs more frequently in the United States than in most other countries, it would not be correct to say that recruiting talent directly from other organizations is restricted to the United States. Obviously, employees in a free society can leave one employer and seek a job with another employer. But in the United States, a staffing strategy of many organizations in the private sector is to see competitor employers as a potential source of talent to fill vacancies. This approach is most common with respect to jobs at the senior managerial, professional and technical levels.

organizations seeking talent from other organizations generally use two methods: The first is basically an informal network approach, where people in one organization know someone in another organization, etc. It is difficult to obtain reliable data on how widely the networking approach is used or with what results. It is safe to say that networking is an important component of recruitment in most organizations, although rarely formalized.

Much better known, and perhaps more effective, is when organizations engage the services of project/programme purposees that specialize in locating and recruiting talent. These organizations, often referred to as “headhunters” or executive search organizations, have developed a sophisticated methodology to recruiting needed talent from competitor organizations. Generally speaking, professional search organizations are fairly expensive, but they are efficient and do much of the screening for the employer. They become very valuable as organizations diversify and require new areas of expertise. The search organizations manage a diverse group of job candidates, representing many areas and levels. In addition, search organizations can be helpful in the salary negotiation process with the candidate. Executive search organizations are very common worldwide. Using the services of a search organization can be very efficient. They have been around long enough so that guidelines have evolved on how best to engage and use such a organization. For example: Know the organization you hire. Go beyond reading the literature, interview consultants in depth, check references and learn how the organization operates. Settle for a solid, stable and well-organized search organization, with an excellent track record. Work closely with the consultant who represents the search organization. Be cautious when a organization tries to impose a candidate you do not think is the best fit or pushes excessive demands for the services that it renders.

Search organizations earn their revenue through a percentage of the salary of the person they located if the search is successful. In some cases, these organizations are on a retainer to the organization, which has the benefit of the search organization becoming very knowledgeable about the organization’s work requirements. In other cases, the search organization receives a flat fee for services rendered.

3. Use of Temporary Employment Agencies

There are many temporary personnel organizations, providing employees to organizations for short and long-term assignments. Traditionally, these organizations provided only clerical and secretarial personnel. Given the ups and downs of the project/programme purpose landscape, there have emerged many temporary organizations providing professional staff. A organization can obtain the services of professionals (engineers, accountants, technicians and the like) through the temporary agency. In many ways, this avenue could be advantageous, enabling the organization to get to know the temporary employee before having to decide to offer him or her a permanent position. In addition, they present a good last resort option. Many organizations use temporary agencies in order to make sure that they do not overhire. Microsoft and other high technology organizations, aware of the ups and downs of the market, use employment agencies as part of their overall human resources strategy. They want to protect their core group of permanent employees and make sure that they do not overhire, especially in the event of a recession and the prospect of layoffs.

In this study unit, we have considered various considerations for a organization as it decides on a strategy to obtain the talent necessary to make the transition from monopoly to competition and to prosper in the new effective environment. In addition to recruitment, there is an important trend underway for effective organizations to outsource certain functions. Most prominent among functions that are being outsourced to organizations that specialize in that work are information technology and computer services. Other functions that are increasingly being outsourced to specialized organizations are payroll, benefits and other data intensive and technical services. Many organizations have a very difficult time recruiting information technology personnel (such as programmers and software engineers), or they come at such a high price, that the organizations own volume of work cannot support a full-time person. In these and other circumstances, outsourcing can be a prudent approach to obtain quality performance, even though it is done by individuals who are not employees of the organization.

IV. SELECTING FROM THE POOL

The objective of a recruitment strategy is to generate a sufficiently large pool of candidates so that the person selected or hired for the job accomplishes what was intended when the decision was made to go into the external market. The HR Department typically does most of the screening of applicants and reduces the pool to a small number. However, it is important that the line managers, responsible for the activities in which the newly hired person will work, are involved in the interviewing and final stage selection activities.

Selection (or hiring) should be viewed as an integral part of the organization’s strategy to recruit and retain talent. Selection is the process of matching the qualifications of the individuals in the recruitment pool with the requirements of the job that is going to be filled. The objective is to select the most qualified person. There exist a wide range of exercises and methods that a organization can use to select the candidate from the pool. Among the most common selection methods, used alone or in combination, are interviews, tests and reference checks. There are no right or wrong methods. Many research studies have been conducted on how to insure a high success rate in selection. Most of these studies have demonstrated that the single best predictor of success on a new job is the individual’s record of performance in past jobs. Any line manager with responsibility for selection is well advised to enlist the assistance of the HR Department and its specialists for advice and support.

[Notes to learners: read, “Looking to Hire the Best. Ask the Right Questions. Lots of Them.”]

A. The Selection Interview

The interview is an almost universally used step in the hiring process. Unfortunately, most interviews are quite unreliable. That is a problem to be remembered, especially since casual, unstructured interviews often have a great influence on the ultimate hiring decision. Experts advise to avoid commonplace questions, such as “What are your strengths and weaknesses?” or “Where do you see yourself in the next year, next three years, etc?” These questions are well known and rehearsed by all job candidates. Hence, they become of very limited value. In addition, unstructured interviews are marred by biases, such as the well known “like me” bias (people tend to hire people like themselves), or the order of applicants (if an average candidate is interviewed after a poor one, the average candidate appears stronger than is objectively the case).

The unstructured interview, although widely used, can be made more reliable by turning it into more of a structured interview. One approach to this is for different interviewers to interview independently, using the same interviewing script. This technique is to insure that interviewers do not influence each other. The different interviewers should compare notes and reach a common decision based on their individual assessments.

Examples of Structured Interview Questions

� Have you ever been in charge of increasing market share?

Research findings indicate that structured interviews conducted by multiple independent interviewers generally yield good results.

B. Selection Tests

Various kinds of tests are regularly used in the selection process. Some are written tests to determine the intelligence and/or personalities of potential employees. Testing in the selection process was more popular in the 1960s and 1970s than it is today. There are many controversies related to the use of tests and their use is in decline. Another category is performance simulation tests. Simulations are done as “work sampling.” Work sampling mimics the work environment, asking candidates to perform tasks required by the job analysis. Another approach to testing as part of selection, is the use of “assessment centers.” Assessment centers involve the candidate, potential managers and peers, as well as organizational psychologists. Candidates generally spend two to four days at the center, solving problems, interviewing and playing project/programme purpose decision-making and strategy games. All the while, their performance and actions are observed by professionals and a record is kept. Assessment centers appear to be valid performance predictors. However, they are very costly and time consuming.

V. HOW A organization CAN FACILITATE NEW EMPLOYEE SOCIALIZATION

External candidates need to be recruited and selected. They also need to be brought into the organization and placed in a job. The work content and the work environment will become crucial determinants of whether the organization will be able to retain its most valued staff.

The effective organization will make a major effort to understanding the priorities of the future employee, in order to inorganizational them into the initial employment package. The individual's priorities may include compensation, career development, and level of work responsibility or work environment. Initial employment offers should be tailored to merge the priorities of the selected candidate and the needs of the organization. The compensation package should be attractive enough not to be a source of discontent. Knowledge of the labor market and latest compensation data are paramount. In addition, the candidate should be able to see that the organization provides opportunities for career development. The position should have responsibilities that motivate and challenge the candidate. The work environment should be a good fit as well. Designing the offer package is often an individualized process, taking into account labor market forces and standards, as well as the individual to be hired. Many organizations offer signing bonuses. Many organizations pay MBA students’ substantial signing bonuses, covering also education expenses, such as student loans. In the Silicon Valley, where currently there is a shortage of technical professionals, signing bonuses are very common.

Once employees have accepted the offer, the process of socialization begins. Socialization is the process of familiarizing the new employee with the organization culture. Professionals tend to undergo a very fast socialization process, as they can become contributors immediately. Experts recommend that one way of retaining professionals is to develop very strong social bonds and/or strong teams.

Recruiting, selecting and socializing external talent are crucial steps in assuring that a organization has the high quality of personnel that will help it to accomplish its project/programme purpose objectives. But none of this will be of much help if the organization is unable to retain the talent that has been so diligently recruited. Retaining talent, especially managerial and professional talent, is an important test of a organization’s effective capabilities. Being successful in this regard requires a portfolio of HR policies and practices. However, retention alone is not enough. There are many known examples where organizations retain talent by paying very large salaries, but where the personnel are not productive because of a negative work environment. A more significant managerial challenge is to keep the talent creative and productive.

We will now consider a case study of what keeps creative professionals productive and loyal, an outcome which every organization in a effective environment seeks.

[Notes to learners: do an analysis of this case in terms of its relevance to their current work situation.]

Many studies have suggested that project/programme purpose organizations (especially the larger ones) get a poor return on their investment in knowledge (also called professional) workers. The reason most widely quoted for this is the inability of the organization to develop HRM practices that foster the innovative and creative behavior for which the knowledge workers were recruited in the first place. Hierarchical control systems, bureaucratization, naive understanding of what motivates knowledge workers and an inability to foster loyalty to the organization, are among the reasons commonly given for why this situation prevails. Successful organizations (and perhaps a main reason for their success) have discovered how to focus the talents of knowledge workers on strategic project/programme purpose objectives.

To better understand the challenges of managing knowledge workers, we conducted studies in three diverse creative environments: universities, entertainment/media and high technology organizations. Our findings on the key ingredients of managing professional employees can be encompassed in five categories, which we can call the Five R's of Managing Knowledge Workers for Creativity and Productivity: Recruiting, Rewards, Responsibility, Resources and Relationships. Although there are many differences among industries, when it comes to creative employees, it seems that the fundamental concepts that managers need to implement to keep the creative individual productive over a career are not greatly influenced by the particulars of an sector of activity or project/programme purpose environment.

Recruitment: At some point all organizations must go into the external labor market for employees. The organization can be reactive in its recruiting and wait for resumes to arrive. Or, it can develop a strategy to increase the likelihood that the pool from which it will select new employees has the potential for the high levels of creativity and innovation desired by the organization. It is not hard to guess which approach is most likely to have a good payoff. It is striking how unsystematic many organizations are in making the all important judgments about who to allow entry into the professional workforce. It is a proactive plan of recruitment and selection that establishes the pool of potential creativity for the organization. This is not the entire story, but it sure helps if the raw material an organization has to work with is of an appropriately high quality.

Rewards: Without appropriate positive rewards, it is unlikely that a knowledge worker will maintain a high performance commitment to an employer, given the risks and effort involved. But, money is not the only reward that matters. Our research suggests that three important types of rewards strengthen an employee’s commitment to the organization. First, rewards in the form of direct compensation help in initial recruitment and in retention, but are not necessarily critical to motivation or performance. Second, rewards in the form of unique or individually tailored compensation packages provide excellent long-term incentives for sustained contribution to the organization. Finally, such non-monetary rewards as public recognition and honors, and special awards, although not a substitute for monetary compensation, are a key part of the overall incentive structure.

Responsibility: The kind of work environment that is most likely to stimulate creative behavior is one which places a premium on personal responsibility for individual and collaborative achievement. In the final analysis, motivation for high performance must come from within the individual, but certain environments are more conducive to stimulating creativity than others. For example, a managerial emphasis on the quality of the contribution rather than with how or where the work gets done should be encouraged. Successful organizations provide opportunity for knowledge workers to participate in power sharing, especially in matters of direct concern to the professionals, but it should not be limited to that. Power sharing should include involvement in setting goals for the project/programme purpose unit. Wise organizations provide opportunities to build intellectual capital – seminars, sabbatical leaves and opportunities for exchange of ideas with peers are generally effective.

Resources: In each of the three settings we studied, employers successfully fostered creativity by making time and money (often small amounts) available to individuals for creative pursuits, and by encouraging internal competition for the resources available. The resources that can assist productivity include adequate workspace, time, equipment, clerical assistance, flexible work schedule, and opportunities for interaction with colleagues, in addition to financial resources.

Relationships: Productive relationships include supportive hierarchy/supervisor structures and positive, synergistic team/peer relationships. Successful organizations in all three industries encouraged managerial behavior on the part of their knowledge workers by offering critical support from the hierarchy and by mobilizing peers to work together on innovative projects. The best of these executives managed by giving the impression of staying out of the way, even while they run a matchmaking service, putting each knowledge worker in touch with others who can move his or her project forward.

Of course, not all personnel required by the effective organization fit into the creative professional category. And retention strategies need to fit the circumstances of the particular category of employee and the work environment.

Among the critical components of any retention strategy for most categories of employees are rewards (compensation and benefits) and a stimulating work environment.

B. Compensation

Compensation needs to be based upon labor market standards and be effective, in order to be able to attract and retain the best performers. Many organizations offer sign-up bonuses in order to attract desired employees. The compensation package is more complex than the base salary, fringe benefits and paid vacation days. Compensation has increasingly been tied in with the performance of the organization. The theory of these approaches is that employees will become more committed to high performance, and develop strong feelings of loyalty to the organization. Below are some examples of these approaches:

[Notes to learners: read the article, “Global Executive Compensation: A Look at the Future.”]

It is common for organizations in the United States to offer stock options as part of the overall compensation package. Employees can exercise the stock options after being vested; the vesting time can vary from organization to organization and from one employee to another. Employee stock option plans have been demonstrated to increase motivation and performance. Virtually all high technology organizations offer such plans. In the high technology sector of activity, stock option plans are often required before an employee accepts a job offer. Various forms of stock ownership and stock option plans are becoming increasingly popular in Europe.

Variable-pay programs base some part of the compensation on the measured performance of the individual, team, or of the organization as whole. The most common types of variable pay are profit sharing and gain sharing. Profit sharing uses formulas that base part of the compensation on the profits made by the organization. Gain sharing is based on group productivity rather than organization profitability. Thus, employees or teams can be rewarded, if they are more productive, even when the organization does not make any profits. Variable-pay programs can be highly motivating for employees.

While these plans have been in effect for managers for many years (pay for performance), they are increasingly being extended to front line employees as well. In Europe, the Bayerische Vereinsbank employs this system for its traders. Gain sharing is practiced especially in manufacturing and unionized organizations.

Competency-based plans base pay on employee skills and how many jobs they can do, this way encouraging and challenging them to acquire new skills and expand professionally. These plans are most prominent among front line workers, but are expanding to white collar and managerial categories of high performance organizations. Experts recommend that highly marketable and hence effective skills should be rewarded with a premium, as a means of retaining talent.

Professionals and managers are high achievers, thriving on challenges and responsibilities. Organizations need to take into account the career interests of these individuals in order to be able to more effectively retain them. Professionals are very committed to their profession, but not necessarily to their organizations. Money is not the only motivator for these employees. What drives them is their passion for their career. Professionals tend to be very focused on their work and like to have important responsibilities and challenging assignments. They enjoy complex problem solving. They value support and recognition, and reinforcement that what they are doing is important. Professionals also like autonomy in their jobs and work. They seek educational and professional development opportunities, such as attending training and conferences, in order to keep their skills updated. They require satisfying and challenging career paths.

One of the main ways to ensure a productive work environment is empowerment through participative management and an emphasis on career development. Participative management is most common in effective organizations with flat and flexible structures. It enables employees to participate in the process of decision-making, which implies problem solving. The ability to participate in making important decisions is challenging, involving responsibility and power. Goal setting also represents an empowerment tool. Thereby, employees participate in the process of designing and setting goals for their project/programme purpose unit or group, as well as for themselves.

[Notes to learners: read the Butler and Baumgartner article, “Job Sculpting: The Art of Retaining your Best People,” in Harvard project/programme purpose Review.]

Professionals view managers as coaches as highly positive. Professional employees are career-driven. Specialists advise that career development should become a systematic endeavor and become part of the performance evaluation process. The employee and his/her immediate supervisor should spend time discussing career goals and development within the organization. The manager needs to be a coach and mentor in order to facilitate the growth and development of his/her employees.

Most performance evaluations imply written assessments by the supervisor regarding accomplishments, goals and plans for the next period and skills to be improved. It would also be advisable to include a career development assessment.

The performance evaluation process represents a very important event in the career lives of employees. The performance evaluation determines how valuable the employee is to the organization and his/her strengths and weaknesses. It represents the way an employee is valued by the organization. Careers in organizations depend upon performance evaluations to a great extent. Many rewards, such as promotions, bonuses, raises, training opportunities and overall career development, hinges on the performance evaluation.

Assessments are generally performed by supervisors, peers, one’s self, or by everybody interacting with the employee. The immediate supervisor does the performance evaluations in most cases. This situation is not ideal, as it gives to one individual a great deal of power. It can also be unreliable due to personal biases and subjectivity, and is becoming less feasible in an environment where employees are organized in teams or telecommute.

Peers may provide the most informed evaluations. They interact daily with the person being evaluated, becoming very well acquainted with his/her performance. Multiple evaluations performed by different people are generally more reliable than that written only by the supervisor. There may be issues with the peer review as well. Either friendship or enmity may play a role. If a group makes the evaluation, the groupthink phenomenon may emerge and upset the process.

Self-evaluation provides a very good opportunity for the employee to evaluate his/her own performance. Problems may arise with boosted egos and self-serving biases, whereby everybody has the tendency to see oneself as better than in reality. Another issue is the potential contradiction between the self-evaluation and the supervisor’s evaluation, leading to negative feelings. The self-evaluation is a highly recommended tool – but only a tool – for career development.

As far as professionals are concerned, as previously mentioned, they require substantial and honest feedback. The performance evaluation should be very comprehensive. In addition, career development is an important part of the evaluation.

Training is very important to managerial and professional employees. It is very important for them to keep abreast of new developments in their areas of expertise. This is why; they need to participate at training seminars as well as at conferences. Many project/programme purpose schools also organize specialized conferences and courses tailored exclusively for working professionals.

Professional and managerial employees like to have autonomy over their time. They are usually work driven and work far beyond the required schedule. But, they like to be in control of their time. This is why it is advisable to allow them a high degree of autonomy over their own schedules.

Flexible work arrangements seem to enhance motivation and performance. Forms of flexible schedules include compressed workweeks (e.g., working four days a week for 10 hours each day, rather than working a traditional schedule of eight hours per work day) or flextime. Flextime enables the employee to have latitude over when she or he comes to work, although they may have to work a specified number of hours and be at work at certain times. In addition, many professional employees telecommute; they do the work at home on a computer linked to the office.

[Note: Assignments 1 and 2 should be completed individually by each learner as the conclusion of this.

The Case study is conceived as a team project. It should be introduced near the beginning of this Module so that the teams can work on the different parts of the case as the relevant questions and issues arise. As a result, this case is something that the learners will be working on during the entire period of this Module. The final written report (or possibly, the final report could be set up as an online discussion) of the teams and should be submitted to the tutor at the end of the course.]

This assignment is about applying what has been learned in this Module to recent changes, (if any), in the managers’ role in recruitment and retention at your organization. Please answer each element of the question from your perspective as a manager.

Write a short essay about how your role has changed during the past several years with respect to each of the activities listed below?

� Your participation in the process of recruitment and selection of subordinates.

B. Assignment 2

Please reflect on the performance evaluation process in the unit/department in which you presently have managerial responsibilities. Considering what you have learned in this course with respect to retention of talent, how well does the existing performance evaluation system cover the following topics. Write a short essay on each of the questions below:

� Are the methods for conducting the performance evaluation appropriate for the task that needs to be accomplished?

� Please explain how the performance evaluation system helps or hampers retention of the most talented employees in the organization.

You are part of the management team at the Electrical Research and Development Department at organization headquarters. A technological breakthrough is about to happen, making your plants more efficient and cost effective. In order to take advantage of this new technology in a timely manner, you need to hire highly educated, top-notch electrical engineers from the external market. The market for electrical engineers is very tight. Many of them have embraced information technology in order to take advantage of the booming project/programme purpose generated by the Internet. You are under pressure, time-wise, as well. In order to succeed, you need to have a team of top electrical engineers in place in a few months. As you well know, hiring these talented people from outside is highly challenging. It is, however, only part of the problem. You also have to ensure that they will stay with your organization.

The Recruitment Plan: Develop a comprehensive recruitment plan from which you will select a team of top quality electrical engineers.

The Retention Plan: Develop a retention plan, ensuring that these highly marketable experts will stay with your organization.

4. A plan to ensure that these highly talented and marketable employees will stay with your organization.

Butler, Timothy and Baumgartner, Peter. “Job Sculpting: The Art of Retaining The Best People,” Harvard project/programme purpose Review, September-October 1999, 144-152.

The authors are psychologists and directors of career development at Harvard project/programme purpose School. They recognize that retaining talented employees represents a major challenge for employers. They recommend that managers engage in individualized career development, which they call “job sculpting.” This method takes into account not only skills and abilities, but also “deeply imbedded interests.”

Richard J. E. “Global Executive Compensation. A Look at the Future,” Compensation and Benefits Review, May/June 2000, 32(3): 35-38.

This article focuses on the international trend linking pay to performance. Employee stock ownership is becoming more prevalent worldwide, characterizing both executive and employee compensation. Country differences exist and should be observed.

Ulrich, David. “A New Mandate for Human Resources,” Harvard project/programme purpose Review, January-February, 1998, 124-134.

This article outlines and focuses on the new roles and functions of human resources professionals and departments in the context of the new effective and globalized project/programme purpose environments. Human resources professionals have become strategy integrators, efficient administrators, change agents and employees’ advocates.

Assessment Centers: Candidates generally spend from two to four days at a center, performing a large array of project/programme purpose-like activities, under professional supervision.

Compensation Package: The organization’s bundle of monetary rewards and non-monetary benefits for an employee.

Competency-Based Pay Plans: Pay systems that reward employees for their skills, expertise, and how many jobs they can perform. These plans are intended to challenge and motivate employees to constantly acquire new skills.

Gain Sharing: A variable pay program that rewards group productivity, irrespective of organization profitability.

Headhunting: A colloquial American term for professionals or organizations specializing in executive and professional recruitment on behalf of organizations.

Outsourcing: When organizations have entire functions performed by specialized outside organizations. It is assumed that the outside organizations can manage more efficiently and economically functions such as payroll and information technology.

Profit Sharing: A variable pay program, using formulas that calculate part of the compensation based upon organization performance.

Selection: The process of choosing from among candidates in the recruitment pool. The selection process may involve interviewing, testing, and making the job offer.

Vesting: Gaining entitlement to exercise stock options. It takes a specified period of time for employees

Answer 1: Excellent question. Although we have not devoted much attention to job analysis in this Module, it is very important to an organization because it is the job analysis that provides the foundation information for the job description and job specification, which in turn are critical stages in the recruitment and selection of staff.

At core, job analysis is the process of obtaining information about jobs. The data that gets generated in this way serve as the foundation for most human resource management activities. In general, job analysis involves collecting and recording job information, and developing job descriptions based on the information. A job description describes the activities performed on a job, and, as we have stressed, is a key part of the recruitment and selection process. Also, from the job analysis, job relevant training programs can be developed because information about skills and other requirements to perform a job will be included. For more background on this you might consult with the professional staff of the HR Department.

B. Question 2: Please give us a bit more detail about the pros and cons of using temporary employees rather than hiring permanent replacements.

Answer 2: Every country has laws governing the use and payment of temporary employees. You need only to read the newspaper to learn that unscrupulous employers often exploit temporary employees. However, exploitation is not an inevitable outcome of using temporary employees. In uncertain economic times or when the future direction of the organization is uncertain, temporary employees are an attractive alternative to seeking, hiring, and training new permanent employees for every vacancy. Especially in the high technology organizations it is very common to have a small core of permanent employees who are insulated from short-term economic shifts. Temporary workers can be quickly hired through a temporary help agency as needed to meet demand. There are many other aspects that could be elaborated, but again, I would suggest consulting with the staff of the HR Department.

C. Question 3: Once again, what is the main idea behind a structured interview as a tool in selection?

Answer 3: First of all, there are no absolutes. Keep this in mind. The degree of structure in an interview concerns how planned the questions were before the start of the interview. A completely structured interview is when all of the questions were planned in advance. Now all questions need not be planned in advance. When some, but not all questions are planned, you might call that a semi-structured interview. An unstructured interview is not planned in advance. Research has shown that the more structured the interview, the greater its reliability.

Advantages	Disadvantages
Improved morale of promoted employee	Possible morale problems of those not promoted
Better assessment of abilities	Potential lack of diversity at top
Lower cost for some jobs	Political infighting for promotions
Motivates employees by signaling opportunities for advancement	Less likely to introduce innovation or fresh ideas
Have to hire only at entry level	Too close to new subordinates

Advantages	Disadvantages
Best qualified, if chosen from pool of internal and external candidates	Perceived as rookies by current employees or may not “fit”
Fresh perspectives and different approaches	Learning curve to understand the organization’s policies and procedures
Less expensive than training employees promoted from within	May cause morale problems for current employees not promoted
More likely to provide diversity	Longer socialization process
May bring insight into competitors	May retain attitudes from old job

Source	Number of Employment Offers	Number of Acceptances	Total Cost	Turnover After 1 Year	Average Performance Rating at 1 Year
Referrals
Print ads
Internet ads
Agencies
Colleges
beneficiaries
Source: Managing Human Resources by Luis R. G�mez-Mej�a et al.

a) Yield ratios	1) The process of identifying and describing the aspects of a job.
b) Time-lapse data	2) The process of identifying, screening and attracting desirable job candidates for organization positions. The outcome of recruitment is a pool of qualified candidates for a vacant position.
c) Realistic job preview	3) The process an organization uses to ensure it has the right amount and the right kind of people to deliver a particular level of output or services in the future.
d) Job analysis	4) Positive and negative information about the demands of the job, the organization’s expectations of the jobholder and the work environment.
e) Human Resource Planning	5) Compares recruitment input to recruitment output.
f) Recruitment	6) Shows how much time on average elapses between decision points in the recruitment process.

Criteria for Assessing Recruitment
Stage of Entry	Type of Criteria
Pre-entry	Total number of applicants Number of minority and female applicants Cost per applicant Time to locate job applicants Time to process job applicants
Offers and hires	Offers extended by source Total number of qualified applicants Number of qualified female, minority and physically disabled applicants
Entry	Initial expectations of newcomers Choice of the organization by qualified applicants Cost and time of training new employees Salary levels
Post-entry	Attitudes toward job, pay, benefits, supervision and co-workers Organizational commitment Job performance Tenure of hires Absenteeism Referrals
Adapted from Personnel and Human Resource Management.

Recruiting and Retaining Outside Talent

CONTENTS

II. THE HUMAN RESOURCES MANAGEMENT (HRM) FRAMEWORK FOR RECRUITING AND RETAINING OUTSIDE TALENT

III. RECRUITMENT AND SELECTION

A. Developing a Pool of Candidates

1. Recruiting at project/programme purpose Schools – the MBA Phenomenon

3. Use of Temporary Employment Agencies

IV. SELECTING FROM THE POOL

A. The Selection Interview

Examples of Structured Interview Questions

� Have you ever been in charge of increasing market share?

B. Selection Tests

V. HOW A organization CAN FACILITATE NEW EMPLOYEE SOCIALIZATION

B. Compensation

B. Assignment 2

Assessment Centers: Candidates generally spend from two to four days at a center, performing a large array of project/programme purpose-like activities, under professional supervision.

Competency-Based Pay Plans: Pay systems that reward employees for their skills, expertise, and how many jobs they can perform. These plans are intended to challenge and motivate employees to constantly acquire new skills.

Selection: The process of choosing from among candidates in the recruitment pool. The selection process may involve interviewing, testing, and making the job offer.