5

Personnel Planning
and Recruiting
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 Learning Objectives

1. Explain the main techniques used in employment planning

and forecasting.
2. Explain and give examples for the need for effective
recruiting.
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3. Name and describe the main internal sources of candidates.
4. List and discuss the main outside sources of candidates.
5. Explain how to recruit a more diverse workforce.
6. Developing and Using Application Forms: Discuss practical
guidelines for obtaining application information.
 THE RECRUITMENT AND SELECTION
PROCESS
Recruitment and selection ideally starts with workforce planning . After all ,If you
don't know what your teams employment needs will be in the next few months ,why
should you be hiring?
Workforce (or employment or personnel) planning is the process of deciding
what positions the firm will have to fill, and how to fill them. It embraces all future
positions, from maintenance clerk to CEO. However, most firms call the process of
deciding how to fill executive jobs succession planning
1. Decide what positions to fill through personnel planning and forecasting.
2. Build a candidate pool by recruiting internal or external candidates.
3. Have candidates complete application forms and undergo initial
screening interviews.
4. Use selection tools to identify viable candidates.
5. Decide who to make an offer to, by having the supervisor and others
interview the candidates.
 FIGURE 5–1 Steps in Recruitment and Selection Process

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The recruitment and selection process is a series of hurdles

aimed at selecting the best candidate for the job.
 PLANNING AND FORECASTING

• The basic process of forecasting personnel needs is to forecast revenues first ,then
estimate the size of the staff required to support this sales volume.
• Managers must consider other strategic factors (projected turnover, productivity
changes and financial resources).
• Employment or Personnel Planning
• The process of deciding what positions the firm will have to fill, and how to fill them.
• Succession Planning
• The process of deciding how to fill the company’s most important executive jobs.
• What to Forecast?
• Overall personnel needs ( labor demand)
• The supply of inside candidates
• The supply of outside candidates
 Labor demand is how many workers the organization will need in the future.
 The labor supply for an organization is how many workers are available with the
required skills to meet company needs.
 If labor supply exceeds labor demand, HR needs can best be met by reducing wages.
 If labor demand exceeds labor supply, HR needs can best be met through worker
training.
 If labor demand equals labor supply, HR needs can best be met by transferring
employees internally
 FORECASTING PERSONNEL NEEDS
( LABOR DEMAND)

Forecasting Tools

Trend Ratio Scatter Computerized

analysis analysis plotting forecast
 FORECASTING PERSONNEL NEEDS

• Trend analysis can provide an initial estimate of future staffing needs,

but employment levels rarely depend just on the passage of time.
Other factors (like changes in sales volume and productivity) also
affect staffing needs
• Definition: it means studying a firm’s employment levels over a period
of years to predict future needs.
• Ratio analysis a forecasting technique for determining future staff
needs by using ratios between (1) some causal factor (like sales
volume) and (2) the number of employees needed(such as number of
salespeople).
• Scatter plot shows graphically how two variables—such as sales and
your firm’s staffing levels—are related. If they are, and then if you can
forecast the business activity (like sales), you should also be able to
estimate your personnel needs.
 DRAWBACKS TO TRADITIONAL
FORECASTING TECHNIQUES

• 1. They generally focus on historical sales/personnel

relationships and assume that the firms existing
activities will continue as is.
• 2. They tend to reward managers for adding employees
, irrespective of the company’s strategic needs.
• 3. They tend to institutionalize existing ways of doing
things, even in the face of change.
Whichever forecasting tool you use, managerial judgment should play a
big role. Its rare that any historical trend, ratio, or relationship will simply
continue. You will therefore have to modify any forecast based on
subjective factors- such as the feeling that more employees will be quitting
-you believe will be important
 USING COMPUTERS TO FORECAST
PERSONNEL REQUIREMENTS
• Computerized Forecasts
• Software that estimates and determines future staffing needs by
Projecting sales, volume of production, and personnel required
to maintain different volumes of output, using software
packages.
• Enable the manager to build more variables into his or her
personnel projections. Newer systems particularly rely on
mathematically setting clear goals. Many firms particularly use
computerized employee forecasting systems for estimating short-
term needs
• The use of software programs can enable employers to quickly
translate projected productivity and sales levels into forecasts of
personnel needs, while estimating how personnel requirements
will be affected by various productivity and sales levels.
 FORECASTING THE SUPPLY
OF INSIDE CANDIDATES

Knowing your staffing needs satisfies only half the staffing equation. Next, you
have to estimate the likely supply of both inside and outside candidates. Most
firms start with the inside candidates. The main task here is determining which
current employees might be qualified for the projected openings . For this you
need to know current employees skills sets -their current qualifications

Qualification
Inventories

Manual systems
Computerized
and replacement Markov Analysis
skills inventories
charts
FORECASTING THE SUPPLY OF INSIDE
CANDIDATES
• Qualifications Inventories: Manual or computerized
records listing employees’ performance records,
educational background, and promotability. career and
development interests, languages, special skills, and so
on, to be used in selecting inside candidates for
promotion.
• These help managers determine which employees are
available for promotion or transfer.
 FORECASTING THE SUPPLY OF INSIDE CANDIDATES

MANUAL SYSTEMS AND REPLACEMENT CHARTS

Department managers or owners of smaller firms often use manual
devices to track employee qualifications. Thus a personnel inventory
and development record form compiles qualifications information on
each employee. The information includes education, company-
sponsored courses taken, career and development interests,
languages, desired assignments, and skills
Personnel replacement charts (Figure 5-4) are another option,
particularly for the firms top positions. They show the present
performance and promotability for each positions potential
replacement. As an alternative, you can develop a position replacement
card. For this you create a card for each position, showing possible
replacements as well as their present performance, promotion
potential, and training
FIGURE 5–4 Management Replacement Chart Showing Development
Needs of Potential Future Divisional Vice Presidents

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 FORECASTING THE SUPPLY OF INSIDE
CANDIDATES
2. Computerized Information Systems: Larger firms obviously
cant track the qualifications of hundreds or thousands of employees
manually. Larger employers therefore computerize this information, using
various packaged software systems such as Survey Analytics’s Skills
Inventory Software. Such programs help management anticipate human
resource shortages, and facilitate making employment recruitment and
training plans. Increasingly, they also link skills inventories with their other
human resources systems. So, for instance, an employees skills inventory
might automatically update each time he or she is trained or appraised.
 used to track the qualifications of employees. The system can provide
managers with a listing of candidates with specified qualifications after
scanning the database.
 Computerized skills inventory data typically include items like work
experience codes, product knowledge, the employee’s level of familiarity
with the employer’s product lines or services, the person’s industry
experience, and formal education.
FORECASTING THE SUPPLY OF INSIDE
CANDIDATES
• MARKOV ANALYSIS Employers also use a
mathematical process known as Markov analysis (or
transition analysis ) to forecast availability of internal job
candidates. Markov analysis involves creating a matrix
that shows the probabilities that employees in the chain
of feeder positions for a key job (such as from junior
engineer, to engineer, to senior engineer, to engineering
supervisor, to director of engineering) will move from
position to position and therefore be available to fill the
key position.
KEEPING THE INFORMATION PRIVATE

• Ensuring the Security of HR Information

• Control of HR information through access matrices
• Access to records and employee privacy
• Employers must balance an individual’s right to privacy
while making HR information legitimately available to
those in the firm who need it.
• The employer should secure all its employee data. Much
of the data is personal (such as Social Security numbers
and illnesses). Legislation gives employees legal rights
regarding who has access to information about them.
FORECASTING OUTSIDE CANDIDATE
SUPPLY
• If there wont be enough inside candidates to fill the
anticipated openings (or you want to go outside for
another reason),you will turn to outside candidates.
• Forecasting labor supply depends first on the
manager’s own sense of what s happening in his or
her industry and locale, for example expected
unemployment rates or General economic conditions.
He or she will then supplement these observations
with more formal labor market analyses
 DEVELOPING AN ACTION PLAN TO MATCH PROJECTED
LABOR SUPPLY AND LABOR DEMAND

• Workforce planning should logically culminate in a

workforce action plan. This lays out the employer s
projected workforce demand- supply gaps, as well as
staffing plans for filling the gaps . For example the
staffing plan should identify the positions to be filled,
potential internal and external sources for these
positions, the required training, development, and
promotional activities moving people into the positions
will entail, and the resources that implementing the
staffing plan will require. Resources might include, for
instance, advertising costs, recruiter fees, relocation
costs, and travel and interview expenses.
 EFFECTIVE RECRUITING
Employee Recruiting:
Finding and/or attracting applicants for the employer’s open positions.
Why Recruiting is Important?
• Recruiting is a more complex activity than most managers think it is.
• Hiring better talent than your competitors more quickly will make important
inroads in your marketplace.
• With the dramatic changes, recruiting is becoming more challenging , and
there will soon be an undersupply of workers.
What Makes Recruiting a Challenge?
• First, some recruiting methods are superior to others, depending on the type
of job for which you are recruiting.
• Second, the success you have recruiting depends on nonrecruitment issues
and policies.
• Third, employment law prescribes what you can and cannot do when
recruiting.
FIGURE 5–6 Recruiting Yield Pyramid

THE RECRUITING YIELD PYRAMID

is used by some employers to calculate the number of
applicants they must generate to hire the required number of
new employees.
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50% ● ●

67% ● ● ●

75% ● ● ● ●

16% ● ● ● ● ● ●
 ORGANIZING HOW YOU RECRUIT

Organizing How You Recruit :Companies make a choice

to centralize their recruiting efforts in one place or to
decentralize to various locations.
1. Advantages of centralizing are that it is easier to
apply the company’s strategy.
2. Decentralization is a more sensible choice if divisions
are autonomous or needs are varied
 INTERNAL SOURCES OF CANDIDATES

Advantages Disadvantages

• Foreknowledge of • Failed applicants

candidates’ strengths become discontented
and weaknesses • Time wasted
• More accurate view of interviewing inside
candidate’s skills candidates who will not
• Candidates have a be considered
stronger commitment • Inbreeding strengthens
to the company tendency to maintain
• Increases employee the status quo
morale
• Less training and
orientation required
 FINDING INTERNAL CANDIDATES

Hiring-from-Within Tasks

Succession
Posting open Rehiring former Qualifications
planning
job positions employees skills banks
(HRIS)

Job posting: means publicizing the open job to employees (usually by literally
posting it on company intranets or bulletin boards). These postings list the job’s
attributes, like qualifications, supervisor, work schedule, and pay rate.
Qualifications skills banks: also play a role. For example, the database may
reveal persons who have potential for further training or who have the right
background for the open job.
Rehiring: Rehiring former employees has its pros and cons. On the positive
side, they are known quantities and are already familiar with the organization.
But former employees may return with negative attitudes. Current employees
may perceive that the way to get ahead is to leave and come back.
 FINDING INTERNAL CANDIDATES

• Succession Planning: the ongoing process of

systematically identifying , assessing, and developing
organizational leadership to enhance performance.
Succession planning entails three steps:
1- identify key needs.
2- develop inside candidates.
3- assess and choose those who will fill the key positions.
OUTSIDE SOURCES OF CANDIDATES
Locating Outside Candidates
1 Recruiting via the Internet 6 Executive Recruiters

On Demand Recruiting
2 Advertising 7
Services (ODRS)

3 Employment Agencies 8 College Recruiting

Temp Agencies and Alternative

4 9 Referrals and Walk-ins
Staffing

5 Offshoring/Outsourcing
 OUTSIDE SOURCES OF CANDIDATES

Informal Recruiting and the hidden job market

Many or most job openings aren’t publicized at all (perhaps half of all positions are filled informally ( without
formal recruiting) .
Recruiting via the Internet ;by websites or use job boards
Social media and HR ;Recruiting is also shifting from on line job boards to social networking sites such as
Facebook ,LinkedIn, and Twitter . The main problem is the passive candidates (people not actively looking
for jobs )
Pros and cons for online recruiting
• Advantages
• Cost- efficient way to publicize job openings
• More applicants attracted over a longer period , generating more responses more quickly.
• Providing exposure for a longer time at less cost
• Immediate applicant responses
• Online prescreening of applicants
• Automation of applicant tracking and evaluation
• Disadvantages
• Exclusion of older and minority workers
• Unqualified applicants overload the system
• Personal information privacy concerns of applicants
 OUTSIDE SOURCES OF CANDIDATES
• Advertising for Outside Candidates
• The Media Choice
Selection of the best medium depends on the positions for which the firm is
recruiting.
• Newspapers: local and specific labor markets(is often a good source
for local blue-collar help, clerical employees, and lower-level
administrative employees).
• Trade and professional journals: specialized employees
• Internet job sites: global labor markets
• Constructing (Writing) Effective Ads
 Many experienced advertisers use a four-point guide called AIDA (attention,
interest, desire, action) to construct their ads.
OUTSIDE SOURCES OF CANDIDATES

Employment Agencies

Types of
Employment
Agencies

Public Nonprofit Private

agencies agencies agencies
 OUTSIDE SOURCES OF CANDIDATES

Public and Nonprofit Agencies – Every state has a public, state-run employment
service agency supported by the Department of Labor, in part through grants and
other assistance, such as a nationwide computerized job bank. Many professional
and technical societies, and public welfare agencies have units that try to help
their members or people in special categories find jobs.
Private Agencies- charge fees for each applicant they place. Typically, market
conditions determine whether the candidate or employer pays the fee.
Why Use a Private Employment Agency?
• No HR department: firm lacks recruiting and screening capabilities to attract a
pool of qualified applicants.
• To fill a particular opening quickly.
• To attract more minority or female applicants.
• To reach currently employed individuals who are more comfortable dealing
with agencies than competing companies.
• To reduce internal time devoted to recruiting.
 OUTSIDE SOURCES OF CANDIDATES
Temp Agencies and Alternative Staffing
Employers increasingly supplement their permanent workforces by hiring contingent or
temporary workers, often through temporary help employment agencies. Also known as part-
time or just-in-time workers, the contingent workforce is big and growing.
The contingent workforce isn’t limited to clerical or maintenance staff. It includes thousands of
engineering, science, or management support occupations, such as temporary chief financial
officers, human resource managers, and CEOs.
Employers can hire temp workers either through direct hires or through temporary staff
agencies.
Why ?
• Continuing weak economic confidence among employers .
• Trend toward organizing around short –term projects .
Alternative Staffing
In-house contingent (casual, seasonal, or temporary) workers employed by the company, but
on an explicit short-term basis.
The Use of nontraditional recruitment resources.
Know your Employment Law; Temporary workers like all workers have important legal rights.
 TEMP AGENCIES AND ALTERNATIVE
STAFFING
• Benefits of Temps / Advantages
• Increased productivity—paid only when working. (Therefore, desire for ever-
higher productivity also contributes to temp workers’ growing popularity.)
• Allows “trial run” for prospective employees before hiring them as regular
employees.
• No recruitment, screening, and payroll administration costs. As a result ,
time and expenses are saved.
• Costs of Temps / Disadvantages
• Increased labor costs due to fees paid to temp agencies
• Temp employees’ lack of commitment to the firm
 OUTSIDE SOURCES OF CANDIDATES
Offshoring and Outsourcing Jobs
Outsourcing means having outside vendors supply services (such as benefits management, market
research, or manufacturing) that the firm’s own employees previously did in-house.
Offshoring is a narrower term. It means having outside vendors abroad supply services that the
firm’s own employees previously did in-house.
• Outsourcing and offshoring are perhaps the most extreme examples of alternative staffing.
Rather than bringing people in to do the firm’s jobs, outsourcing and offshoring send the jobs out.
• Offshoring/Outsourcing White Collar and Other Jobs – Hiring workers abroad is becoming more
and more common. There are several specific issues that the HR manager should keep in mind
when considering this option.(political tension , security and information privacy concerns, the
offshore employees need special training , cultural misunderstandings )
Executive Recruiters (Headhunters)
They are special employment agencies retained by employers to seek out top-
management talent for their clients. For executive positions, headhunters may be your
only source of candidates. The employer always pays the fees.
Advantages and Disadvantages:
Recruiters can be useful and can save a manager’s time, but they can be more
interested in persuading you to hire a candidate than in finding the one who will really
do the job.
OUTSIDE SOURCES OF CANDIDATES
On Demand Recruiting Services (ODRS)
This service provides short-term specialized recruiting to support specific projects
without the expense of retaining traditional search firms. Basically, recruiters get
paid by the hour or project.
Employee Referrals
They are alternatives for identifying potential candidates. Referrals tend to generate
high quality candidates. the employer often offers prizes or cash awards for
referrals that lead to hiring
• Referring employees become stakeholders.
• Referral is a cost-effective recruitment program.
• Referral can speed up diversifying the workforce.
• Relying on referrals may be discriminatory.
Walk-ins
Walk-in candidates may be attracted by posting a “Help Wanted” sign.
• Seek employment through a personal direct approach to the employer.
OUTSIDE SOURCES OF CANDIDATES
• College Recruiting On-site visits
Process : it involves sending (They are usually extended to good candidates.)
employers’ representatives to • Invitation letters
college campuses to prescreen • Assigned hosts
applicants and create an • Information packages
applicant pool of management • Planned interviews
trainees, promotable candidates, • Timely employment offer
and professional and technical • Follow-up
employees. Internships
On-campus recruiting goals They are a recruiting approach that can be a
win-win situation for the employer and the
• To determine if the student. For employers, interns can make
candidate is worthy of useful contributions while being evaluated for
possible full-time employment. Students, are
further consideration able to work on business skills, check out
• To attract good candidates potential employers, and learn more about
their likes and dislikes.
 RECRUITING A MORE DIVERSE
WORKFORCE

Single parents

The disabled Older workers

Welfare-to- Minorities and

work women
 RECRUITING A MORE DIVERSE WORKFORCE

A. Single Parents – Formulating an intelligent program for attracting single parents

should begin with understanding the considerable problems they often encounter
in balancing work and family life.
B. Older Workers – With the entire population aging, many employers are
encouraging retirement-age employees not to leave, or are actively recruiting
employees who are at or beyond retirement age by making their companies an
attractive place in which older workers can work. An image of older worker-
friendliness and flexibility in scheduling are vital.
C. Recruiting Minorities and Women – requires employers to tailor their way of
thinking and to design HR practices that make their firms attractive to them.
D. Welfare-to-Work – The Federal Personal Responsibility and Welfare Reconciliation
Act prompted many employers to implement programs to attract and assimilate
former welfare recipients.
E. The Disabled – Employers can do several things to tap into this huge potential
workforce. The Department of Labor’s Office of Disability Employment Policy offers
several programs, and all states have local agencies that provide placement
services and other recruitment and training tools.
 DEVELOPING AND USING APPLICATION FORMS

• Purpose of Applications Forms – Application forms are a good way to quickly

collect verifiable and fairly accurate historical data from the candidate.
• Using Application Forms to Predict Job Performance – Some firms use
application forms to predict which candidates will be successful and which will
not by conducting statistical studies to find the relationship between (1)
responses on the application form and (2) measures of success on the job.

Uses of Application Form

Information

Applicant’s Applicant’s Applicant’s Applicant’s

education and prior progress employment likelihood of
experience and growth stability success
KEY TERMS
employment (or personnel) planning
trend analysis
ratio analysis
scatter plot
qualifications (or skills) inventories
personnel replacement charts
position replacement card
employee recruiting4-
recruiting yield pyramid
job posting
succession planning
applicant tracking systems
alternative staffing
on-demand recruiting services (ODRS)
college recruiting
application form