Attracting the Right Talent Learning Outcomes

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Attracting the Right Talent
Learning Outcomes
After reading this chapter, you should be able to do the following:
• Identify a wide range of sources for attracting and recruiting talent.
• Explain the strategic value of effective recruitment through combinations of internal and external applicant
sources and recruitment strategies.
• Link recruitment to the strategic HRM process.
• Apply pertinent HR laws to the recruitment process.
• Discuss emerging trends, opportunities, and challenges in recruitment.
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People are indeed the most valuable asset of an organization. Without their knowledge, skills,
and talents, an organization will not be able to operate or compete effectively in the market. This is why recruitment plays a strategic role. The purpose of the recruitment process
is identifying and attracting qualified talent for organizational jobs in a timely and effective
manner. Organizations can find talent in internal ways and external ways. These methods are
discussed in detail in this chapter.
Opening Case Study
The End of Jobs?
The attraction and recruitment of talent has been at the center of employers’ attention for
many years. For decades, management glibly mouthed the maxim, “Our employees are our
most valuable asset.” However, there is evidence that structural changes in our society may be
causing management to reconsider the value of people. Here are some recent examples.
• Goldman Sachs Group, Inc. reported that they intended to fire employees in sales and
trading, investment banking, wealth management and investing and lending, and
replace them, when possible, with new technology (LaCarpa, 2012).
• In the military, unmanned systems have replaced human soldiers on dull, dirty, or dangerous missions, as robots have defused over 10,000 roadside bombs in Iraq (Myers, 2009).
• A grocery warehouse that once employed 50 to 60 workers to fill orders for grocery
stores, place them on pallets, and load them on trucks for delivery, now uses robots
exclusively to fill all the orders (Kelly, 2011).
• In Fresno, California, Pacific Gas and Electric used to employ 50 full-time meter readers,
but with installation of digital meters that collect and transmit information to a central
data center, only six meter readers remain employed (Wiseman, Condon, & Fahey, 2013).
• Using robots, Webb Wheel Products is now making 300,000 break drums annually (a
25% increase) without adding a single employee in three years (Wiseman, Condon, &
Fahey, 2013).
Organizations appear to be leveraging any possible technology advantage to reduce the need
for people, the once most valuable resource. Automation has enabled organizations, even
entire industries, to replace workers with software and self-service technology in the service
sector, and robotic technologies in manufacturing; perhaps we are witnessing a structural
change of such dramatic proportion in the workplace that we are not likely to see a reduction
in automation and technology.
A recent study by the Associated Press found that almost all jobs being replaced by technology
are in industries that pay middle class wages, jobs that form the backbone of the middle class
in Europe, Asia, and America. For instance, in the United States more than 1.1 million secretaries vanished from the job market between 2000 and 2010 as their jobs were replaced by
software that lets bosses field calls themselves and arrange their own meetings and trips. It is
estimated that over two thirds of the 7.6 million middle class jobs that disappeared in Europe
since 2008 were due to technological innovations. The HRM function enjoys no special protection from the impact of this ongoing structural change. A negotiator with the Dutch labor
union federation FNV noted that individual employees are now expected to do for themselves from
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Finding Talent in the External Labor Market Section 4.1
4.1 Finding Talent in the External Labor Market
In order to recruit strategically, an organization may need to gather information about potential candidates for a job who do not work for that organization and may not have applied
for a job at that organization before. These potential candidates may currently be full-time
students, employed elsewhere in the same or a different industry, or unemployed. They may
be actively seeking employment, or they may be content with their current situation. As you
learned in Chapter 2, scanning the environment and analyzing the labor market are part of
strategic HR planning. The recruitment process translates environmental scans and labor
market analyses into specific actions to find and attract pools of candidates with the specific
competencies and skill sets that the organization needs, wherever these candidates can be
found. In this section, you will learn about a wide range of external sources of candidates and
strategies that can be used to find and attract talent.
Advertising Jobs
Newspapers, magazines, television, and radio are all common examples of media sources
where organizations can advertise jobs. In general, the effectiveness of a job advertisement
depends on two related factors: cost and reach. Cost represents a certain type of advertising
media’s price; for example, television advertising is more expensive than radio advertising.
That’s why many local employers with limited resources advertise on local radio.
On the other hand, cost cannot be the only consideration in selecting where to advertise a job
opening. It is critically important that the advertising venue be able to reach the target audience.
For example, nationwide advertising media may be necessary and justified if the pool of applicants
Opening Case Study
The End of Jobs? (continued)
their computers much of what was once considered the function of HRM; where he once could
walk into the employee affairs office and get answers to questions about pensions or terms of a
contract, all of that is now automated and accessible from his computer (Wiseman et al., 2013).
Over a decade ago, Cardinali (2000) observed that the number of unemployable job seekers
increases as the use of technology increases; and further complicating the issue is the fact that
those displaced by technology are often deemed not trainable, and if they are trainable, they
are frequently branded as not having sufficient working years left to be worth the training
investment. What about the often-heard retort that technology creates new jobs? Yes, new
jobs are indeed created, but nowhere near the rate at which technology is killing them off. The
advance of technology is producing wondrous products and services, but it is also taking a toll
on people because they can be so easily replaced (Wiseman et al., 2013). Corporate profits
have soared as businesses embrace new labor-saving technologies, while at the same time
doing everything and anything they can to avoid hiring permanent workers (Solman, 2013).
The implications of these trends are far from clear. On one hand, automation and technology
are rendering many jobs obsolete. On the other hand, talented “knowledge workers” who
can work with technology and collaborate effectively with others are in high demand. Perhaps the job market is shifting toward a different skill set altogether. What tomorrow’s highdemand talents are likely to be remains to be discovered by employers and employees alike.
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Finding Talent in the External Labor Market Section 4.1
is dispersed across the nation and if the organization is willing to relocate a qualified applicant or
allow him or her to work from a distance. On the other hand, a low-paying job with no relocation
provisions will likely attract local candidates, and local advertisements may be sufficient for it.
There is a strategic value to integrating the two criteria of cost and reach. Ultimately, the utility of a job advertisement is determined by its costs and benefits, which are determined by
the cost per qualified candidate reached. For example, most television advertising is expensive; yet, with millions of viewers, the cost per viewer reached may be minuscule. The most
important strategic question is what percentage of those viewers are actually qualified for the
job. If this percentage is low then the cost, per qualified applicant reached, may be prohibitively high. Organizations can improve these ratios by targeting their advertisements specifically to television channels, programs, and airtimes that attract larger numbers of the desired
pool of applicants.
As another example, advertising a job in the classifieds section of a news site is usually inexpensive. However, qualified people who are currently employed rarely read the classifieds, so
a job may have to be advertised for several weeks and on numerous sites before a qualified
candidate can be found. Thus, costs may escalate per qualified candidate reached. In that case,
it may be more effective to place a more expensive advertisement in a professional or industry journal that can more readily reach qualified candidates. Multiple media sources can also
be strategically combined to target diverse applicant pools.
An organization also has to make sure that an advertisement does not generate an excessive number of applicants, since the process of reviewing and eliminating applicants is costly
and time consuming. To avoid this problem, an advertisement should provide sufficient information about the company and clearly specify the position’s preferred qualifications and
minimum competencies. Advertisements are generally costly and cost more the longer they
are; a long advertisement is sometimes necessary to clearly convey the desired information.
The challenge is to provide neither too much nor too little information—only enough for the
advertisement to be effective. Careful and intentional choices are necessary for both a job
advertisement’s content and its media sources.
Web Links
Job Advertisements in USA Today
Browse through the jobs advertised on USA Today’s career classifieds for examples of position
openings that organizations are seeking to fill through a national search.
Job Advertisements in the Chicago Tribune
Select “Classified” from the Sections menu and click on the Jobs link to browse through jobs
advertised on the Chicago Tribune for examples of position openings that organizations are
seeking to fill through a regional or local search. You can also browse job openings advertised
in your own area on your local newspapers’ Web sites.
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Finding Talent in the External Labor Market Section 4.1
Employment Agencies
Employment agencies are a leading
source of job candidates. There are
two types of employment agencies:
public and private. Both types primarily serve the same purpose: gathering
information about individuals seeking
employment in the market; evaluating
their qualifications, skill sets, and experiences through a series of interviews
and tests; and then connecting them
with the relevant organizations for
Public employment agencies work to
connect unemployed individuals—
mostly blue-collar and hourly workers—
with hiring employers for the purpose
of getting them on an employment payroll, hence relieving the state of having to provide unemployment aid. To that end, both
employers and individuals seeking employment must register with a local or state employment office. Public employment agencies normally do not charge organizations any fee for
recruiting personnel.
Web Link
California Employment Development Department
This website provides an example of the services offered by a public employment agency.
Search the Web for the site of a similar public employment agency in your own state. Compare
the services offered and browse the jobs advertised.
Web Links (continued)
Discussion Questions
1. What types of information are included in the job advertisements you browsed?
2. What additional information would you have wanted to know as a potential candidate?
3. What are some of the main differences between local and national newspaper job
Yellow Dog Productions/Getty Images
The goal of employment agencies is to connect
qualified individuals to organizations with job
openings in a relevant field.
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Finding Talent in the External Labor Market Section 4.1
Private employment agencies, also known as headhunters, primarily deal with white-collar
employees such as executives, managers, and professionals. It is therefore crucial that
organizations provide headhunters with accurate and detailed job descriptions and job specifications to ensure that the right candidate is recruited. There are two types of private employment agencies: contingency and retainer firms. The classification depends on the method by
which a private firm charges the employer. Contingency firms charge the employer only if an
employee is successfully hired by the organization. On the other hand, retainer firms charge
the employer a fee for bringing qualified candidates to the organization’s attention, regardless of whether the organization eventually hires these candidates.
Web Recruiting
Online recruiting has become a primary recruitment method. There are three main sources
of Web recruiting:
• Web job boards and postings
• Professional/career websites
• Employer websites
As the name implies, job boards allow employers to post available openings online to attract
qualified employees, at the same time allowing individuals who seek employment to post
their resumes.
HR can also use job boards to determine compensation packages offered by other organizations for similar positions and then use that information to create more competitive compensation packages to attract qualified individuals. However, many individuals are not seriously
seeking a position: they merely post their profiles on job boards to check job availability or
compensation packages offered by other organizations.
Career Web sites are employment sections on professional associations’ websites. These sites are
highly specific to a certain field, specialization, or industry. There are multiple advantages associated with this type of online recruiting for both employers and individuals seeking employment.
For employers, professional Web sites selectively attract only professional applicants who are
actually interested in a particular specialization. These sites do not attract the general population. For potential candidates, professional Web sites can significantly cut down search time and
effort since candidates can directly search their areas of specialization.
Web Links
The Ladders
These two Web sites are examples of private employment agencies. Search both Web sites
for information about the range of services each headhunter offers for employers and for job
candidates, as well as whether it can be classified as a contingency or a retainer firm.
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Finding Talent in the External Labor Market Section 4.1
Finally, employer Web sites feature career and employment sections that are designated for
recruiting. Linking to these sections allows individuals to check job descriptions and specifications and post their resumes for company consideration. A significant advantage of
employer Web sites is creating a valuable database and connecting with passive job seekers
who are currently not looking for a job but would be willing to interview if presented with an
attractive job offer (Starner, 2006).
Colleges and Universities
Conducting interviews on college and university campuses is one of the most influential and
effective sources of recruiting, especially for entry-level professional and technical positions.
On-campus career placement offices assist in connecting students with recruiting organizations by organizing career fairs and other recruiting events (Smith, 1995). Employers consider many factors when they select a college or university for recruiting purposes, such as
the college’s reputation, past experience with the university recruiting office or recruited
individuals, the nature of the job opening, the organization’s allocated recruiting budget, the
level of market competition, and the value of the talent in question.
Organizations can use many techniques to establish a successful college or university recruiting program. Summer internship programs are one technique. They offer organizations an
initial introduction to potential permanent recruits before any long-term commitments are
Web Links
Jobs at Google
Jobs at Southwest Airlines
Visit these two examples of employer Web sites.
Web Links
The Career Center of the Association of Accountants
and Financial Professionals in Business
Career Connections at the American Society of Civil Engineers
These are two examples of professional career Web sites. Note each job advertisement’s
higher level of specialization, focus, and level of detail. Now browse the Web for professional
organizations within your field, looking for sites that offer career-related links.
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Finding Talent in the External Labor Market Section 4.1
made. Other influential methods for college recruiting include building longterm relationships with reputable faculty and staff members in certain highly
regarded universities, in addition to
maintaining an on-campus presence for
the organization through guest speaking
and other recruiting support activities.
Professional Employer
Organizations and Temp
Two of the channels organizations
revert to when they search the market
for talented employees are professional employer organizations (PEOs) and temp agencies (in this term, temp is short for “temporary employment”). PEOs and temp agencies provide the service of leasing talent to other organizations based on their needs. The difference
between PEOs and temp agencies is that PEOs are more geared toward higher-end professional employees. Moreover, PEOs share authority over the leased employee, while in most
cases temp agencies maintain full control over their employees. PEOs’ first appearance in the
market was in 1980 (“Professional employer,” 2009).
Both employers and employees gain several advantages from PEOs. Employers are able to
secure the services of highly qualified employees whose work they might not be able to afford
on a permanent basis. Moreover, the PEO bears all responsibilities associated with hiring,
firing, payroll, benefits, taxes, and other administrative functions. These responsibilities allow
employers to focus on their own business functions. Companies then reimburse PEOs for
their services in the form of a percentage of the customer’s gross wages. However, one of the
disadvantages to employers in using PEOs is the absence of employee loyalty, as employees
obtain all compensation and benefits from the PEO rather than from the client, and employees know that their engagement with employers is only temporary.
PEO employees enjoy great advantages, including cheaper, better, and broader choices of
benefits owing to the PEOs’ large number of employees, which allows PEOs to enjoy economies of scale. Another advantage to employees is better job mobility, either locally or
internationally for some PEOs. In case of an international transfer, this mobility can open
more doors and provide multiple venues of job opportunities for employees and their
spouses. More job opportunities also translate to additional job security and job seniority
Outplacement Agencies
When some firms experience economic downturns that require downsizing, they retain an
outplacement firm to assist terminated employees. While the assistance generally consists of
counseling and training to facilitate a good person/job match, the firms often keep a job bank
of computerized listings of applicants and their qualifications. For a fee, employers seeking
Frances Roberts/age footstock/Superstock
Colleges and universities are great recruiting
grounds for entry level professional positions.
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Finding Talent in the External Labor Market Section 4.1
applicants can access these data banks and find qualified and experienced employees seeking
Job and Career Fairs
Professional associations, the military, and underrepresented minorities (e.g., older workers,
disabled citizens, and racial groups) often hold and promote job or career fairs on behalf of
their constituents. Typically, the sponsor will hold such an event in a central location with a
large facility. While employers actively recruiting employees may have to pay a fee to participate, job fairs that are advertised well in advance will likely yield a large number of applicants.
With a typical job or career fair generating around 1,600 candidates across 65 employers,
many employers are now devoting their resources at job and career fairs to information sessions geared toward smaller groups of specifically qualified candidates, and this appears to
provide both applicants and employers a valuable complement to such events (Heneman, III, &
Judge, 2009).
Unsolicited Resumes and Applications
Qualified employees often seek a career only within reputable organizations that have favorably prominent cultures and practices. The main reason individuals pursue such companies
is that they believe they can grow and further develop their technical and interpersonal qualities there. Reputable companies also provide more stability and job security than other
A reputable image within the market is advantageous to organizations. Qualified employees
tend to get so attracted to those specific organizations that they send in their resumes or
applications even when no immediate opening is available. This practice is the source of the
term unsolicited applications. Selecting among unsolicited applications can save the organization a considerable amount of money
and resources that would have been
spent on recruiting efforts. Moreover,
employees hired through unsolicited
applications will likely be more committed to the organization, perform
better, and provide a long-term human
advantage for the organizations they
seek to associate with.
Soliciting Specific Applicants
Job seekers may send unsolicited
resumes to organizations whose reputations they admire. In the same way,
organizations can also solicit specific
applicants based on those applicants’
recognized, unique capabilities. This
is especially common in positions that
NASA/Bill Ingalls/REX/AP Images
Due to the very unique qualifications needed
for employment, NASA is a good example of an
organization that routinely seeks out specific job
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Finding Talent Internally Section 4.2
require rare qualifications. Once a candidate is located, the organization invites that applicant to apply for the position. Candidates are usually offered an attractive package of compensation, benefits, working conditions, and growth and development opportunities to
motivate them to accept a job or to lure them away from their current employers. Organizations that routinely solicit specific applicants include the National Aeronautics and Space
Administration (NASA), the Federal Bureau of Investigation (FBI), and the Central Intelligence Agency (CIA).
Advantages and Disadvantages of External Recruitment
There are many advantages to hiring from outside the organization, using external recruiting
• The introduction of new individuals into the organization can bring fresh ideas and
perspectives, all of which promote a healthy and dynamic organizational culture.
• New individuals usually possess diverse experiences from their former jobs, enriching the organization’s knowledge base and familiarizing its current employees with
competitors’ products and practices.
• New hires normally require less initial training and supervision, which saves organizations a great deal of time, money, and effort.
The following outcomes are among the disadvantages to external recruitment:
• Selection errors can result if good candidates are not identified—i.e., candidates who
have the skill sets required to fulfill the job duties and responsibilities or have the
right personality, attitude, or organizational cultural background to fit into the hiring
• Qualified internal candidates within the organization can be disappointed when
they have unsuccessfully sought one of these openings as a promotion or a desirable
lateral move. This disappointment can lead to perceptions of betrayal and violated
psychological contracts; compromise loyalty and commitment to the organization;
and lead to numerous morale, attitudinal, and behavioral problems.
• It may take some time for new hires to adapt to a new organizational culture or environment. This time can translate into additional cost.
Thus, a balance of external and internal recruitment is necessary.
4.2 Finding Talent Internally
Internal candidates are a valuable resource that many organizations overlook when they
make recruitment decisions. Sometimes, familiarity with internal candidates and their roles
in particular positions obscures the possibility that they could be ideal candidates for other
positions. Moreover, many organizations do not regularly update their employee databases
with KSAOs and competencies that current employees acquired after they were hired. This
incomplete information sends organizations looking for external candidates for job openings
without realizing that they actually have what they need internally. This section offers some
approaches to internal recruitment.
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Finding Talent Internally Section 4.2
Promoting From Within
Promoting from within is the internal
recruitment of qualified individuals
from within the organization. Current employees gain the opportunity
to be informed about internally open
positions through a variety of methods. Internal job postings are the most
prominent way an organization informs
its employees of available job openings.
Internal candidates can then respond to
the openings they are interested in and
qualified for.
Lateral Transfers
A lateral transfer is another form of
internal recruiting. The direction of the
move is the only difference between lateral transfers and promoting from within. In promotions from within, the direction of recruiting is vertical: from a lower to a higher position,
usually to a managerial or supervisory level. Lateral transfers reflect a horizontal move in
which individuals take on new positions yet remain at the same level of the organizational
hierarchy. Lateral transfers can be across departments, business units, geographic locations,
product lines, or customer accounts.
Lateral transfers can provide an alternative career advancement path for talented employees
who prefer to stay within their technical areas of expertise, rather than move up to a managerial or supervisory position. Many organizations now offer multiple career paths to accommodate these preferences and retain talent. For example, Millipore is a cutting-edge bioscience
research leader. It offers its talented research, development, and technology employees the
option to advance their careers and receive higher pay in technical positions without leaving
the laboratory environment or assuming managerial responsibilities. Scientists who choose a
technical career path assume additional technical responsibilities, such as more challenging
projects or advanced technologies.
Employee Referrals
Employee referrals are a form of recruiting through which employees recommend personal
or professional acquaintances, such as friends or family members, for the organization’s
employment consideration. Employee referrals are one of the largest sources of recruiting,
especially for large organizations. Approximately one fourth of all large organizations’ new
hires are recruited through employee referrals (Crispin & Mehler, 2010).
Employee referral assists HR managers in acquiring qualified candidates in many significant
• The referring person readily familiarizes potential recruits with the organization’s
culture, products, and processes.
Managers may find the talent they are looking for
within their own organization.
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Finding Talent Internally Section 4.2
• It provides a convenient and low-cost way to reach capable individuals and creates
a considerable database of qualified potential employees for future consideration
within the organization.
• Individuals hired through employee referral programs have a greater tendency to
stay within the organization, compared to people hired through external recruiting
agencies or job advertisements (Kiger, 2007).
• Referrals provide a very useful way to recruit in many parts of the world where
labor is very scarce, and in particular areas of specialization for which qualified
workers are hard to find.
As a result of the importance and effectiveness of employee referrals in recruiting, many companies have developed employee referral programs that aim to reward employees for referring qualified individuals.
Advantages and Disadvantages of Internal Recruitment
Although internal recruitment might sound more appealing and easier to implement, it has
its benefits and limitations, as does any other recruiting system. Internal recruitment has four
important benefits:
1. It raises the morale of promoted individuals as they develop more security, sense of
commitment, and loyalty to the organization.
2. Employees promoted internally become more satisfied, productive, and efficient,
and their performance and work generally become better.
3. It is generally easier to make an accurate judgment about an internal employee’s
skills, abilities, performance indicators, technical experience, and personality characteristics, which ultimately results in a better determination for job compatibility
and placement.
4. Internal recruitment costs are considerably lower compared to such external sources
as job agencies.
Internal recruiting also includes the following disadvantages:
1. Internal recruitment does not introduce new ideas, experiences, or cultures to the
2. Current performance reviews or other organizational indicators of performance
might not be a true reflection of the individual’s capacity for or efficiency in performing the new job. This disparity is particularly evident when high-performance
internal candidates are promoted from normal to managerial or supervisory positions for which they have no adequately refined leadership skills.
3. More training and development are needed for the tasks and responsibilities associated with the new position for an internally promoted employee than for an externally hired recruit with the relevant set of experiences. This disparity is particularly
evident in internal promotions to managerial or supervisory positions.
4. Moreover, internal recruitment can create conflict and hard feelings among internal
candidates who believe they are as qualified as or more qualified than the individual
who has been selected for a job. These conflicts can compromise performance, both
by those who did not get promoted and by the promoted candidate—who may face
resentment and lack of cooperation from coworkers and subordinates. This situation
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Designing an HR Talent Inventory Section 4.3
is especially common when the promoted individual gains authority over former
5. Employees can grow distracted from their main job tasks and become involved
instead in political engagements that might lead to promotions.
6. Internal recruitment often leads to a new opening that has to be filled. Another
drawback of promoting from within is the HR time and effort required to plan and
organize a search for new, qualified candidates who have the right skill set to replace
an employee whom the organization has promoted. Decisions have to be made
for that opening, including whether to recruit internally or externally for the position. Another internal recruitment will trigger another opening, and so on. Hiring
external candidates does not trigger this cycle of promotion decisions within the
4.3 Designing an HR Talent Inventory
Through internal and external resources, organizations are able to have a great pool of talent
comprising candidates from different backgrounds and with different skills, capabilities, and
levels of experience. Organizations use these different resources to build and design talent
inventories, from which they can get an idea of the strengths and potential of their available
candidates. In addition, inventories are a great resource for planning for future development
opportunities or prospective jobs.
The effective design of an HR talent inventory includes tracking:
• The KSAOs and competencies acquired by current employees
• Promotions and lateral movements
• Training and development opportunities
• Performance appraisals
• Changes in assigned tasks, duties, and responsibilities
This information becomes valuable
when the need arises to fill a new
position. For example, if an employee
received a job rotation in a different
department a year ago, this information can be valuable in assessing that
employee’s qualifications for a lateral
transfer to that department.
Moreover, since many employees may
be pursuing learning opportunities at
their own time and expense, information should be regularly solicited from
employees in order to maintain the
most up-to-date inventory possible.
For example, an employee who has
just completed a new college degree,
learned a new language, or organized a
This young man is learning to use a milling machine,
a skill that could help him advance in his career,
especially if human resources professionals within
his company record his training in a talent inventory
for future reference.
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Designing an HR Talent Inventory Section 4.3
fundraising campaign for a local charity, may be a good candidate for a position that requires
these skills.
An HR inventory can also include information about external candidates, including unsolicited applicants who may be suitable for future openings. Many organizations encourage
applicants to send their resumes, even when immediate openings are not posted, to retain
this information in the organization’s database. Rejected applicants can also be included if
future openings arise for which the applicants are qualified. Finally, even “interesting” nonapplicants’ information can be retained in an organization’s HR inventory, so that they can be
solicited to apply again should relevant positions open up later on.
A Moment in the Life of an HR Manager
The Devil You Know May Not Always Be Better
Than the Devil You Don’t Know
Lori is a district HR manager of a large wireless phone service provider. In her organization,
district HR managers are responsible for recruiting all the employees within their respective
districts—including branch managers, supervisors, customer service representatives, and all
other office staff. The company has a nationwide presence and even a few international operations. The company leadership recognizes labor market variations across locations and the
need for flexibility to respond to changing customer needs. Therefore, HR managers, district
managers, and branch managers are given significant levels of authority over whom to hire or
fire; whom to promote or demote; whether to use full-time, part-time, or temporary employees to fill various positions; and even whether to staff or outsource some of the peripheral
functions such as bookkeeping, administrative work, and janitorial services.
When the company hires for a managerial or supervisory position, it is common for the interview panel to include customer service representatives and other employees who would report
to the prospective manager or supervisor. These representatives’ opinions are taken into consideration in the hiring decision. Senior management always emphasizes that if this model is to
work, it is critical that HR managers and branch managers collaborate to make human capital
decisions. Senior management knows that any interference from the head office to centralize
those decisions would not be good for business since the employees closest to the client are the
people who know the best way to run the operation and serve the customer base in one location.
Lori believes that any organization should start by recruiting internally. Her HRM professor
in college always said that when you hire internally, you know the candidate’s strengths and
weaknesses, you develop talent in your organization, and you provide a career opportunity
within your company. “Better the devil you know than the devil you don’t,” he would joke.
Lori wholeheartedly bought into this viewpoint—so much so that she created an electronic
bulletin board to announce job openings internally. She also created an extensive internal and
external employee referral program, instituted across the organization, for which she received
significant recognition from the head office.
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Designing an HR Talent Inventory Section 4.3
A Moment in the Life of an HR Manager
The Devil You Know May Not Always Be Better
Than the Devil You Don’t Know (continued)
Lori has handled her responsibilities very successfully. She has become confident in her
abilities as HR manager, including her unique talent in locating and attracting the right
employees, both internally and externally, and matching them with the right jobs. Employees whom she recruited have consistently exceeded expectations, stayed with the company
longer, and had more satisfied customers than average. These results have brought Lori
many compliments and made the branch managers who worked with her look very good.
That’s probably why she received today’s call from Roger, the vice president of human
Roger: Hello, Lori. This is Roger from the head office. Do you have a few minutes to talk?
Lori: Hello, Roger. Of course; how can I help you?
Roger: Lori, we have a recruitment dilemma, and you’re the best person to help with it.
Lori: Whatever I can do to help. What’s the problem?
Roger: It’s not really a problem. You can say we have too much of a good thing.
Lori: How so?
Roger: Here’s the situation. You know Ken, the branch manager from District 66. He left us
last month, and his position is open.
Lori: Yes, and I’ve been receiving some very good resumes that I’ll send out to the interview panel by the end of the week.
Roger: Here’s the dilemma. I’ve been approached by three supervisors who saw the position on the bulletin board: Ben from Toledo, Carrie from Benson, and Jamie from
Seattle. I’ve looked into each of them. They’re all qualified, dedicated, have proven
track records, and are overdue for a promotion, but we didn’t have any openings
until Ken left. How can we choose among them, and what are we going to do about
the other two? Whoever we pick, we’re going to be disappointing the other two.
Lori: We also have at least two highly qualified external candidates, but you know my
position on that.
Roger: Yes, I do, and I’m all for giving priority to qualified internal candidates. I also know
through the grapevine that both Ben and Jamie have received unsolicited offers
from competitors with higher salaries and better benefits but chose to stay with us
because they like working here. A blow like this would definitely send them away.
Carrie is also toying with the idea of starting her own business, and we might lose
her if we don’t keep her motivated.
Lori: That’s a tough one. Maybe we should hire an external candidate this time. After
all, this branch has been fully staffed through promotions and internal transfers.
Maybe it is time now for some new blood and a fresh perspective.
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Linking Recruitment to the HRM Process Section 4.4
4.4 Linking Recruitment to the HRM Process
Linking recruitment to the strategic HRM process is critical to the success of the organization.
It ensures that the recruitment process is aligned with organizational strategies. As shown in
Figure 4.1 and discussed in this chapter, recruitment should be informed by HR planning, job
analysis, and job design. Recruitment serves as the foundation for effective selection, compensation and benefits, training and development, and performance appraisal. For example, an
organization designs its recruitment strategy and chooses its sources of candidates based on
its environmental scanning and job market analysis (HR planning), as well as the job descriptions and job specifications of the vacant positions (job analysis and job design). Qualified
applicants are then selected, compensated, trained, rewarded, retained, promoted, or possibly let go, based on what they bring into the organization and on how well their qualifications
align with the organization’s needs, goals, and values. Thus, recruitment is central to the HRM
A Moment in the Life of an HR Manager
The Devil You Know May Not Always Be Better
Than the Devil You Don’t Know (continued)
Roger: I can’t believe you’re the one suggesting this, Lori. How can I be sure that those
external candidates are as good as they look on paper or in the interview? You
know our culture. This is going be the first time we hire an external candidate for a
manager position. A lot of people will be upset about this. What’s it going to do to
the morale and loyalty of our employees?
Lori: Give me some time to think about this and do some research about each of the candidates. I’ll get back to you in the next couple of days.
Discussion Questions
1. What are the advantages and disadvantages in filling the above opening with an internal
versus an external candidate? Think about the implications for the current candidates,
other employees within the branch, other managers and employees across the organization, and customers, as well as the implications for Roger and Lori.
2. What additional information would you need to gather about each of the internal and
external candidates before making a decision?
3. If you chose one of the three internal candidates, how would you minimize the negative impact on the other two candidates and on morale in the branch and across the
4. If you chose an external candidate, how would you go about your decision to minimize
the negative impact on the three internal candidates and on morale in the branch and
across the organization?
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Strategic HR
Job analysis
and job design
of talent
Selection and
job fit
Training and
Benefits and
Opportunities, Challenges, and Recent Developments in Recruiting Talent Section 4.5
4.5 Opportunities, Challenges, and Recent Developments
in Recruiting Talent
In this section you’ll explore emerging trends, opportunities, and challenges in recruitment. These include recruiting in a competitive environment, legal and economic issues,
an employer’s ability to attract candidates, the rise of social networking, alternative work
arrangements, globalization, an organization’s internal challenges, labor relations, and the
expectations of both employers and employees in the recruiting process.
Competitive Challenges
Nowadays, it is becoming more and more challenging for companies to acquire talented
employees owing to the high demand and scarce supply for such individuals in the recruiting
market. Even when unemployment rates in general are high, talented and skilled employees
are in short supply. Hiring intellectually talented employees as leaders and innovators gives
organizations a competitive edge among their peers in terms of performance, which translates in turn into profits.
The main problem is that many older baby boomers currently occupy managerial positions.
These employees are approaching retirement age, which poses a great threat to the future
of organizations. It is essential that companies search for talented individuals with concrete leadership potential in order to fill those upcoming vacant positions. Attracting qualified individuals in a continuously growing, competitive market is the main challenge for
Figure 4.1: Attraction and recruitment of talent
Strategic HR
Job analysis
and job design
of talent
Selection and
job fit
Training and
Benefits and
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Opportunities, Challenges, and Recent Developments in Recruiting Talent Section 4.5
organizations (Axelrod, Handfield-Jones, & Welsh,
2001; Fishman, 1998; Michaels, Handfield-Jones, &
Axelrod, 2001; Pfeffer, 2001).
Legal Dimensions of Recruitment:
Equal Employment Opportunity
and Discrimination
As organizations attempt to differentiate between
candidates who possess requisite job skills and
those who do not, it is essential that organizations
strictly adhere to all the laws and regulations governing recruitment. For instance, from the very
earliest stages of recruitment, such as the screening phase, organizations must clearly demonstrate
equal opportunity for all applicants regardless
of their age, sex, religion, or ethnic background.
In addition, organizations must carefully review
their job advertisements and other recruitment
tools to ensure that the language does not suggest any discriminatory preferences. As you will
learn in Chapter 5, organizations must clearly
state and outline their job selection criteria and
be able to justify the hiring or rejection decisions
made regarding any applicant in case the organization’s recruiting practices come under question
as being discriminatory. For that reason, companies should keep well-organized records of all
recruiting activities.
Recruitment, along with all HR functions, is regulated by the Civil Rights Act of 1964. The
act is divided into several sections, called titles, each of which deals with particular facets
of discrimination—e.g., voting rights, public accommodations, and public education. For an
employer, discrimination occurs when an employee is treated differently due to a legally protected characteristic such as gender, religion, race, national origin, or ethnic background. Title
VII of the act guarantees equal opportunity in employment, and it prompted the establishment of the Equal Employment Opportunities Commission (EEOC) to administer and enforce
federal civil rights laws. Today, the EEOC enforces laws that prohibit discrimination based on
ethnic background, religion, sex, national origin, disability, or age. These laws apply not only
to employee recruitment and selection but to other human resources practices such as compensation, training, and promotion.
It is important to note that discrimination laws are highly relevant to applicants who are not
yet employed by the organization. Those applicants are entitled to equal opportunities before
they ever set foot in the organization. Moreover, discrimination laws also apply to nonapplicants. For example, affirmative action policies require that employers show initiative in
recruiting a diverse pool of applicants for their job openings. Organizations where women
and minorities are underrepresented are required to expand their search efforts to include
more women and minorities in their applicant pools. For example, an organization with a
Cultura Limited/Cultura Limited/SuperStock
As members of the baby boomer
generation begin to retire, it is
essential that companies have talented
individuals with solid leadership skills
to replace them.
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Opportunities, Challenges, and Recent Developments in Recruiting Talent Section 4.5
predominantly white male employee base that relies on employee referrals may be asked to
also use job advertisements to reach out to more women and minorities.
However, an organization will never be required to hire less qualified candidates simply
because they belong to an underrepresented group. In fact, such practice is illegal because
it is discriminatory. This practice is often referred to as reverse discrimination because it
discriminates against the majority group. Contrary to common misconceptions, affirmative
action is not about “hiring quotas” forced upon the organization by law. In fact, hiring quotas
of any form are illegal in the United States. Affirmative action is primarily a recruitment philosophy that was originally designed to promote a wider, more inclusive applicant pool.
Economic Challenges: The Rising Costs of Recruitment
In unfavorable economic conditions, organizations aggressively look into cutting costs in
order to stay competitive in the market. Reducing recruiting costs is one of the areas that
organizations actively pursue in such harsh economic conditions (Zeidner, 2009).
To carry out this effort effectively, the first step is to evaluate the current recruiting costs
incurred by the organization. The simplest method is to divide the recruiting costs by the
number of hired personnel for the year. Many elements can be added or removed from this
calculation, depending on the organization’s preferences and on such considerations as testing expenses, training expenses, relocation packages, and bonus agreements.
Organizations attempt to lower recruiting costs through observing, effectively reducing, or
possibly cutting any of these elements. For example, some organizations reduce recruiting
costs in tough economic times by working out short-term discount deals with recruiting agencies, thereby reducing the total recruiting costs incurred by the organization (Zeidner, 2009).
However, even in tough times, it is critical that organizations perform a cost-benefit analysis
when they attempt to reduce their recruiting costs. For example, as discussed earlier, cheaper
recruiting methods do not necessarily reach the right talent; thus, the cost per qualified candidate may be high. Screening large numbers of unqualified applicants may waste time and
resources. On the other hand, a more specialized venue may be more expensive, but may yield
the right candidates in less time. This type of cost-benefit analysis should be pursued in most
HR decisions, and not just in recruitment.
Finally, some HR expenditures yield long-term returns—e.g., recruiting candidates who are
qualified and motivated for the job and committed to stay with the organization. These expenditures should be treated as an investment rather than an expense. They yield worthwhile
long-term benefits that should be taken into consideration when an organization decides
whether specific costs should be incurred or eliminated.
Becoming the Employer of Choice for a Broader Pool of Applicants
HR policies and guidelines directly affect an organization’s ability to recruit qualified individuals and retain valuable employees. Organizational factors related to recruitment, selection, training and development, and compensation and benefits, all contribute to portraying a
favorable organizational image in the job market. Therefore, these factors have a direct influence on attracting talent.
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Opportunities, Challenges, and Recent Developments in Recruiting Talent Section 4.5
As you will continue to see in the “Best Companies to Work For” feature of every chapter,
being recognized as an employer of choice contributes to the organization’s overall reputation, which in turn attracts a wider pool of applicants. Therefore, organizations must carefully
and thoroughly examine their recruiting, selection, and personnel policies, which affect both
current employees and the overall attractiveness and reputation of the organization in the
market and among prospective recruits. For instance, an organization is more likely to attract
qualified applicants when its public image includes career growth, stability, and a favorable
internal environment and culture.
Technological Developments in Recruitment: Social Networking
Social networking is emerging as another effective method for recruiting qualified employees. The general idea behind any social media Web site is that people are invited to join by
existing members who think they would be valuable additions to the emerging community;
a member can offer to communicate with any other member, but the communication does
not occur until the intended recipient approves the contact, and members can then work
through friends they establish in the community. Social networking as a recruiting strategy
involves using the Web informally for hiring purposes through blogs, technical and specialized online journals, informal communication with similar-minded professionals, and job
recruiting websites that reach out to and solicit qualified applicants. The most commonly
used social networking Web sites are Facebook, Twitter, LinkedIn, and Pinterest. LinkedIn is
considered more professionally oriented than other social networking Web sites, which are
oriented more toward personal and social communication.
Social networking has many advantages for both the employee and the employer. One of its
most significant advantages to employers is the ability to search for candidates to fill highly
specialized and unique jobs (Kravitz, 2006; Leonard, 2006). Some social networks also allow
current or former employees to assess and evaluate their employers on the Web through
reviews and questionnaires—helping other candidates make more informed decisions
(Anthaualey, 2006). Most importantly, many social networks are free of charge, which can
reduce recruitment costs.
Best Companies to Work For
#1: Google
”Working here can make you feel that you’ve made it into the technical equivalent of Major
League Baseball or the NFL—you’re at the top of your field.” What a testimony to the power
and attractiveness of Google’s recruitment strategies! Google posts over 4,000 jobs each year
and the applications pile up in no time. Many factors attract future “googlers”: The skyrocketing prices of employee-owned stocks are definitely plus, but the sense of ownership and
belonging to an innovative and successful organization and a great culture are priceless.
Google defines conventional wisdom and changes the rules every day, both in the marketplace,
with its cutting-edge technology, and in the office, with its caring and team-oriented culture.
The pride of working for a company with such a positive reputation is a primary attraction and
a key source of people-based competitive advantage.
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Opportunities, Challenges, and Recent Developments in Recruiting Talent Section 4.5
However, it can also be risky for both
employers and employees to use social
networks for recruitment. For employers, social networks offer their participants a lot of freedom. Job candidates
may therefore self-promote by sharing
false information. They may also post
discriminatory or offensive remarks
that could later expose the organization to legal action. Similarly, employees
may risk their privacy or the illegitimate
use of their personal information when
people involved in illegal activities pose
online as potential employers.
Finally, social networking blurs the
line between personal and professional life. For example, employers and
recruiters routinely check applicants’ Facebook pages to know more about their personal
interests and lifestyles. This practice raises privacy concerns and can also be illegal if an
applicant is rejected for discriminatory reasons such as religious preferences or sexual
orientation. These are reasons for organizations and employees to approach social
networking and other Web-based activities in the workplace (e.g., e-mail and company
websites) deliberately and carefully, since they are governed by the same laws as more
traditional methods.
Alternative Work Arrangements: Outsourcing,
Contracting, and Contingent Workers
As discussed in previous chapters, some organizations revert to outsourcing instead of
recruiting and hiring. Organizations outsource to gain efficiency and lower costs for the same
or better-quality products or services. When an organization specializes in delivering a particular product or service on a large scale, it can afford the advantages of economies of scale.
Web Links
If you do not have an account on LinkedIn, create one. Make sure to use a professional photo
and a polished, proofread resume. Then, start searching for current, former, and potential
future professional contacts, and send them invitations.
Social Recruiting
This article examines the rising trends of social networking use in recruitment.
Social networking and social media can be useful
recruitment tools, but employers and candidates
should also be aware of the risks.
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Opportunities, Challenges, and Recent Developments in Recruiting Talent Section 4.5
Outsourcing is therefore common in countries where wages and salaries are lower. Outsourcing to other countries has been growing considerably because of technological advances in
networks and transmission methods. Some of the most commonly outsourced services are
payroll, legal services, and customer service.
As appealing as it sounds, outsourcing has disadvantages that can offset the advantages, such
as security breaches, deficient customer service, and quality control problems. Organizations
that are known for outsourcing may also have a harder time attracting and retaining talent
because potential applicants or current employees may perceive them as insecure places to
work. Nevertheless, outsourcing can be a viable alternative to traditional recruitment when
talent is rare, unavailable, or too expensive to retain on permanent payroll. The organization
can then outsource roles on an as-needed basis.
Another form of alternative work arrangement is contingent employment of temporary and
contract workers. Contingency employment offers many advantages to organizations:
• It enables organizations to effectively adapt to changes in market demand.
• It alleviates financial burdens associated with direct hires such as record keeping
and other administrative responsibilities and obligations.
• It eliminates the costs of benefits such as retirement plans; health, life and unemployment insurance; and other compensation benefits.
• Outside contract employees bring their experiences from other organizations and
share them with permanent workers in the organization (Connelly & Gallagher,
2004; Matusik & Hill, 1998).
On the other hand, contingency employment can bring disadvantages to both an organization
and its temporary or contract employees. Some temporary employees are discouraged by
contingency employment because they cannot afford the cost of health insurance, which is
usually partly or sometimes fully covered by organizations for permanent employees. For
organizations, federal laws sometimes pose a hurdle since they give temporary and contract
employees some rights that restrict organizations from controlling contingency employees.
One example is hours of operation. Contingency employees also may not feel as much sense
of commitment to the organization as permanent employees—an attitude that may lower the
delivered service’s or product’s quality. However, research on the attitudes and behaviors of
contingent employees is mixed on this question. New models and methods are needed to better understand how contingent workers relate to their temporary employers (Gallagher &
Sverke, 2005; Van Dyne & Ang, 1998).
Web Link
This Web site provides its customers with paid expert advice on a wide range of topics, including medical, legal, engineering, computer, mechanical, psychological, and even personal and
relationship matters. Although experts are highly qualified consultants, they are hired as independent contractors, which makes them fit the classification of contingent workers.
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Opportunities, Challenges, and Recent Developments in Recruiting Talent Section 4.5
Recruiting Globally
With an increasing demand and competition for talented employees, more and more organizations are resorting to either searching for talent or sourcing work globally. For many
organizations, this option is much more effective and efficient than getting involved with
competition in a war over talent in a limited-supply local market. Several factors must be
carefully considered and analyzed by organizations before they venture into global recruiting,
• Cultural differences
• Brand recognition
• Variations in HR laws, practices, and compensation systems (Vashistha, 2007)
Global organizations may also resort to global recruitment to fill job openings overseas.
Global recruitment capabilities can facilitate the assimilation of the organization’s operations
in global markets by giving it a local “face” and “feel.” Global recruitment can also help build
the organization’s reputation as a contributor to the local community, and local employees
can have useful insights into how products and services can be adapted to the local market.
Since locals do not have to relocate, they are usually easier to find and attract, and they are
less likely to suffer from cultural shocks than their international counterparts. Thus, unless
expatriates from the home country or from another location are needed, global recruitment
offers many benefits that global organizations should consider.
Internal Challenges to Effective Recruitment: Organizational
Structure, Culture, and Politics
As you probably deduced from the vignette presented earlier in this chapter, organizational structure, culture, and politics can affect recruitment. An organization’s image is an important factor
in attracting and retaining talent. Employees are attracted to organizations that they perceive as
having structures and cultures compatible with their personalities and preferences (Gardner,
Reithel, Foley, Cogliser, & Walumbwa, 2009). Moreover, people who are hired because of their
compatibility with corporate culture are more likely to stay longer (Hunt, 2011). For example,
organizational structures that do not support internal recruitment and career development may
not be attractive to candidates with high needs for growth. In fact, organizational politics and
HR systems that emphasize seniority have been found to be associated with counterproductive
behaviors such as hoarding information and fragmentation between workers (Finlay, 1990).
Unions, Labor Relations, and Recruitment Practices
A major role of HR is to act as a mediator between employees and organizations, helping align
employees’ interests with the organization’s expectations. Accordingly, organizations depend
heavily on HR to keep such relations as healthy as possible. In many organizations, employees
are also members of and are represented by labor unions. HR has additional responsibilities
in these organizations, such as negotiating employment contracts and, when necessary, effectively managing and resolving problems.
The National Labor Relations Act (NLRA) of 1935 legalized unionization and collective bargaining. Therefore, most business organizations cannot require or prohibit their employees
to unionize, nor can they discriminate against employees who do so through recruitment,
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Opportunities, Challenges, and Recent Developments in Recruiting Talent Section 4.5
selection, training, compensation, promotion, or any other HR processes. However, union
membership has been declining, and collective bargaining has decreased in importance
(“Union members summary,” 2015). These reductions may be due in part to the increased
litigation protecting workers’ interests, both in the United States and globally (Brown, Nash,
Deakin, & Oxenbridge, 2000).
Realistic Job Previews and Psychological Contracts
HR practices have a direct impact on attracting new, qualified individuals and retaining
skilled personnel. HR has the recruitment responsibility to carefully and thoroughly investigate and analyze jobs, creating a realistic job preview for potential hires. HR must also
communicate all positive and negative aspects of the job to applicants, rather than concealing some or all of the negatives, or exaggerating some of the positives, to lure in qualified job
seekers. Misrepresenting a job will create a culture of organizational mistrust, make newly
hired or currently available skilled personnel reluctant to remain in their positions, impoverish performance and motivation, and eventually worsen employee turnover (Hom, Griffeth, Palich, & Bracker, 1998).
Employers and potential employees have their own sets of expectations toward one another
during the recruitment process. Potential employees expect a clear, true, fair representation
of the job and of the organization in general. Organizations, in turn, expect their job applicants to represent their talents and abilities truthfully. This mutual relationship between
employers and the employees becomes part of the psychological contract that develops over
time, as discussed in earlier chapters. A psychological contract based on an honest exchange
of information will likely be more conducive than dishonesty can be to a productive working
Studies show that there are five major areas of expectations for employees towards their
• Career progression and growth within the organization
• Challenging job duties and responsibilities that fit individuals’ capabilities
• Favorable organizational culture
• Adequate compensation for the tasks performed
• Work-life balance
Employers also have five major expectations for employees:
• That employees demonstrate willingness, effort, and efficiency as they perform their
duties and responsibilities
• That they make themselves available whenever needed in order to accomplish tasks
outside their normal working hours
• That they display ethical conduct within the organization
• That they maintain long-term loyalty and commitment to the organization
• That they keep a positive attitude in accepting additional duties and responsibilities
that need to be performed in order to get the job done (Van de Ven, 2004)
As discussed in earlier chapters, and as is evident in these research findings, the psychological contract between employers and employees is changing. Employees are becoming more
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Opportunities, Challenges, and Recent Developments in Recruiting Talent Section 4.5
independent and in charge of their own roles and careers, while employers are expected to
provide opportunities for growth and development. In this type of psychological contract, it
is critical to establish mutual trust—even as early as the employers’ and employees’ interactions during the recruitment process.
Eye on the Goal
The Financial Benefits and Costs of Effective Recruitment:
Pivotal Versus Important Jobs
As emphasized in this chapter and throughout this textbook, a cost-benefit approach should
be adopted for decisions regarding HRM costs. These expenditures should be viewed as investments that yield long-term returns, rather than just expenses to be minimized or avoided.
Recruitment costs fall into this category of expenditures that are truly investments. For example, effective recruitment can reduce the time and energy wasted on going through hundreds,
or sometimes even thousands, of unqualified people’s applications. The ability to find and hire
the right person for the job can save significant costs. Qualified individuals who also fit into
the organization’s culture and are aligned with its goals and values are more likely to be motivated, productive employees who stay longer, contribute more effectively to their roles and
their teams, make fewer mistakes, and require less up-front training. The benefits of finding
these individuals will likely more than offset the costs of the process.
Does that long-term return mean that an organization should invest all its resources in
recruitment and selection efforts, simply because the recruitment investment always pays
off? Not necessarily. As introduced in Chapter 1, Boudreau and Ramstad (2007) make a critical distinction between jobs that are important and jobs that are pivotal. While many jobs in
an organization can be considered important for its success, only a few jobs qualify as pivotal.
Pivotal jobs are those in which improvement in employees’ talents and performances makes
the largest difference in the organization’s success. These pivotal jobs should therefore
receive the organization’s focused recruitment and selection resources. For example, in the
context of a Disney theme park, the people in the costumes representing the characters, such
as Mickey Mouse, are important. However, the park sweepers are pivotal to the success of the
park. The difference between an excellent Mickey Mouse and an average or mediocre one is
not very significant. After all, the employee is always inside the costume, accompanied by a
supervisor, is not allowed to talk, and follows a strict daily schedule and a scripted approach
when dealing with guests. On the other hand, the difference between an excellent sweeper
and an average or mediocre sweeper can have a substantial impact on customer satisfaction.
Many organizations focus their recruitment resources on the Mickey Mouse equivalents of
jobs in their organizations. These are important, highly visible jobs. However, these jobs may
not be as pivotal as jobs that are lower in the organizational hierarchy, but where significant
variation in performance can happen that can directly compromise the success of the organization. For example, while managers are important, customer service representatives may be
pivotal for organizational success in a service organization. Thus, investments in hiring talented customer service representatives may yield higher returns than focusing on hiring the
best managers. These types of strategic decisions should direct expenditure toward effective
recruitment, rather than toward merely minimizing the costs of recruitment by choosing the
cheapest possible sources of applicants.
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Summary & Resources
Summary & Resources
Key Points
• Recruiting qualified employees is essential for sustaining organizational
• HR must be able to find candidates who have the attributes required to succeed in
particular roles.
• Various sources of applicants can be used to find the right talent.
• External sources of applicants include advertising, employment agencies, the Web,
colleges and universities, professional employment organizations, temp agencies,
unsolicited applications, and soliciting specific applicants.
• Internal sources of applicants include promotion from within, lateral transfers, and
employee referrals.
• It is beneficial to involve line managers and employees in the recruiting process.
This involvement can help unify goals and result in attracting and recruiting the best
candidates, at the right time, while the organization conforms to applicable laws,
regulations, and guidelines.
The HR Manager’s Bookshelf
Talent: Making People your Competitive Advantage,
by Edward Lawler
In this book, Lawler (2008) contrasts four types of organizations: structure-centric hierarchical
bureaucracies, structure-centric low-cost operators, human capital-centric high-involvement
organizations, and human capital-centric global competitors. The type of organization guides
its strategy, structure, and processes, which should inform various HR practices in order to
attract and retain the right talent. For example, structure-centric low-cost operators such as
Walmart or McDonald’s focus primarily on cost. They offer low wages and limited benefits,
and standardize most job tasks so that new employees can be trained quickly and efficiently to
replace departing employees in a high-turnover environment.
In contrast, human capital-centric high-involvement organizations invest in their employees’ training and development and attempt to retain them for longer periods of time in
order to get reasonable returns on their investments. This perspective shapes recruitment
and selection processes, as well as compensation, rewards, performance management,
and succession systems. For example, human capital-centric high-involvement organizations are likely to emphasize promotion from within the organization. On the other hand,
while human capital-centric global competitors also emphasize investment in talent, their
investments tend to be in the form of recruiting top talent from outside the organization, even globally, and generously paying for that unique talent, rather than attempting to
develop it and promote it from within.
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Summary & Resources
affirmative action A set of policies that
require employers to show initiative in
recruiting a diverse pool of applicants for
their job openings.
Civil Rights Act A set of laws and regulations, divided into several sections or titles,
each of which deals with particular facets
of discrimination (e.g., voting rights, public
accommodations, and public education);
Title VII of the act guarantees equal opportunity in employment and prohibits discrimination based on gender, religion, race,
national origin, or ethnic background.
employee referrals A form of recruiting
through which employees within the organization recommend personal or professional
acquaintances, such as friends or family
members, for the organization’s employment consideration.
employment agencies A leading source of
job candidates—these are private and public
agencies that gather information about
candidates for employment in the market;
evaluate their qualifications, skill sets, and
experiences through a series of interviews
and tests; and then connect candidates with
the relevant hiring organizations.
HR talent inventory A system that tracks
key indicators of existing talent within the
organization such as the knowledge, skills,
abilities, other characteristics (KSAOs), and
competencies acquired by current employees; their promotions, lateral movements,
and training and development opportunities; and their performance appraisals
and changes in assigned tasks, duties, and
lateral transfer A horizontal move in which
an individual shifts to another position at the
same level of the organizational hierarchy.
professional employer organizations
(PEOs) Organizations that provide employers with talent leases on a temporary basis,
depending on employer needs. See also temp
realistic job preview An accurate picture
of a job that communicates all its positive
and negative aspects to job applicants.
recruitment process The process of identifying and attracting qualified talent for organizational jobs in a timely and effective manner.
social networking (as a recruiting
strategy) The use of the Web in an informal
manner for hiring purposes through blogs,
technical and specialized online journals,
informal communication with similarminded professionals, and job-recruiting
sites that reach out to qualified applicants.
temp agencies See professional employer
organizations (PEOs).
Key Terms
Critical Thinking Questions
1. Some organizations proactively recruit (i.e., “poach”) employees from other companies (especially competitors) by using organizational charts or phone directories to
find the employee’s contact information. Do you think these recruiting methods are
a good business practice? Are there any ethical issues with them?
2. Being extroverted is one trait that recruiters are often thought of as having, but what
other KSAOs should a recruiter possess in order to be successful?
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Summary & Resources
3. Under what circumstances are broader versus more targeted recruiting methods
more appropriate?
4. Some organizations use realistic job previews to present job candidates with accurate information about the negative (and positive) aspects of a job. Under what type
of labor market conditions or for what type of job candidates would realistic job
previews be more appropriate?
5. What would be the best ways to recruit people for your current job, or a job you
have had in the past? What recruiting methods wouldn’t be as effective? Why?
6. Research an example of an organization that has been successful in adapting to the
changing workforce and attracting the right talent. Based on what you have learned
in this chapter, what are some of the strategic directions that facilitate this organization’s success in the competitive labor market?
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