Chapter 3: Human Resource Planning, Recruitment, and Selection

Creating Effective Organizations

Development of Human Resource Management

Parallels the protection and treatment of workers
1.

Social Welfare Department

a. b. c. 1880 1935 Helping injured workers and their families Company unions: parties and social events Worker health

4.

Personnel Department
a. b. c. d. e. f. 1970 1990 Legal compliance Staffing Performance evaluation Compensation and benefits Employee relations Safety and health

2.

Labor Relations Department

a. b. 1935 1950 Collective bargaining Contract administration

5.

Human Resource Management

3.

Industrial Relations Department

a. b. c. d.

1950 1970 Labor relations Benefits and vacations Testing and selection Compensation systems

Staffing Model
Long-range planning Human Resource Planning Middle-range planning

Strategic Business Planning

Human Resource Planning Environmental Scanning Forecasting

Strategic Planning

Operational Planning Goals and Objectives

Short-range planning
Recruitment

Projected Staffing Requirements

Recruitment Planning

Applicant Search
Selection Preliminary Screening Selection Decision

Placement

Typical Steps in the Selection Process

Placement on the job

Selection decision
Final interview Drug testing Reference checks Employment testing Interviews Application blanks

Preliminary screening

Reject applicant

Forecasting Employment Needs

1.
2. 3. 4. 5.

Budgeting Work-load Analysis Unit Demand Expert Opinion Trend Predictions

Example of Predicting Labor Supply and Required New Hires for a Hotel Chain
Supply Analysis A % Quit (rounded) (1996-1998) 38 77 47 85 66 B Number of Present Employees 25 9 23 25 14 C Projected Turnover by 2000 10 7 11 21 9 D Employees Left by 2000 15 2 12 4 5 Supply Demand Comparison E Projected Labor Demand in 2000 32 12 29 32 18 F Projected New Hires in 2000 17 10 17 28 13

Key Positions
General Manager Resident Manager Food/Beverage Director Controller Assistant Controller

Chief Engineer
Director of Sales Sales Manager Convention Manager Catering Director Banquet Manager Personnel Director Restaurant Manager Executive Chef Sous Chef Executive Housekeeper

81
34 68 90 74 60 43 89 70 92 63

24
25 45 14 19 19 15 49 24 24 25

16
9 30 13 14 12 6 44 17 22 16

8
16 15 1 5 7 9 5 7 2 9

31
32 58 18 24 24 19 63 31 31 32

23
16 43 17 19 17 10 58 24 29 23

Total Employees

379

257

122

486

364

Solving the Surplus Personnel Problem

1.
2. 3. 4. 5.

Layoffs Attrition Reduced Hours/Job Sharing Unpaid Vacations Early Retirements

High Performance Work Practices Financial Performance

Sample: 968 U.S. firms with 100 or more employees Financial Data: 10-K reports with the SEC High Performance Work Practices: What proportion of the workforce participates in:
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. Formal information sharing program Formal job analysis Hiring from within Employee attitude surveys Quality of Work Life Programs Company incentive, profit-sharing, or gain-sharing plans Formal grievance and complaint procedures Pre-employment testing Performance appraisals are used to determine promotion Formal performance appraisals Promotion by seniority or performance Selection ratio for hiring What is the average number of hours of training received per employee per year?

High Performance Work Practices - Results

A one standard deviation increase from the mean in high performance work practices is associated with:
7.05% decrease in turnover $27,044 increase in sales annually per employee $18,641 increase in market value annually per employee $3,814 increase in profits annually per employee

Source: Mark A. Huselid, The Impact of Human Resource Management Practices on Turnover, Productivity, and Corporate Financial Performance. Academy of Management Journal, vol 38 (1995): 635-672