1

Part Two: Acquisition and

Preparation of Human Resources
Chapter 5 - Human Resource Planning and Recruitment
Chapter 6 - Selection and Placement
Chapter 7 - Training
Chapter
5
2006 The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin
Human Resource Planning and
Recruitment
Discuss how to align a companys strategic direction
with its human resource planning.
Determine the labor demand for workers in various job
categories.
Discuss the advantages and disadvantages of various
ways of eliminating a labor surplus and avoiding a labor
shortage.
McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.
5
Chapter
Human Resource Planning and
Recruitment
Describe the various recruitment policies that
organizations adopt to make job vacancies more attractive.
List the various sources from which job applicants can be
drawn, their relative advantages and disadvantages, and the
methods for evaluating them.
Explain the recruiters role in the recruitment process, the
limits the recruiter faces, and the opportunities available.
5
Chapter
McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.
Stages in Human Resource Planning
Forecasting
Labor Demand
Labor Supply
Goal Setting and Strategic
Planning
Program Implementation and
Evaluation

McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.
Forecasting Stage of Human
Resource Planning
Determining Labor Demand
derived from product/service demanded
external in nature
Determining Labor Supply
internal movements caused by transfers, promotions,
turnover, retirements, etc.
transitional matrices identify employee movements over
time

Determining Labor Surplus or Shortage
McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.
Strategies for Reducing an Expected
Labor Surplus
Option Speed Extent of Human Suffering


Fast
Fast
Fast
Fast
Fast
Slow
Slow
Slow
Slow
High
High
High
Moderate
Moderate
Low
Low
Low
Low
1. Downsizing
2. Pay reductions
3. Demotions
4. Transfers
5. Work sharing
6. Hiring freeze
7. Natural attrition
8. Early retirement
9. Retraining
McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.
Strategies for Reducing an Expected
Labor Shortage
Option Speed Extent of Human Suffering


Fast
Fast

Fast
Slow
Slow
Slow
Slow

High
High

High
High
Moderate
Low
Low

1. Overtime
2. Temporary
employees
3. Outsourcing
4. Retrained transfers
5. Turnover reductions
6. New external hires
7. Technological
innovation
McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.
Downsizing
Downsizing is the planned elimination of large
numbers of personnel designed to enhance
organizational competitiveness.
Reasons for downsizing include:
need to reduce labor costs
technological changes reduce need for labor
mergers and acquisitions reduce bureaucratic overhead
organizations choose to change the location of where
they do business

McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.
Effects of Downsizing
Studies show that firms that announce a
downsizing campaign show worse, rather than
better financial performance.
Reasons include:
The long-term effects of an improperly managed
downsizing effort can be negative.
Many downsizing campaigns let go of people who turn
out to be irreplaceable assets.
Employees who survive the staff purges often become
narrow-minded, self-absorbed, and risk-averse.
McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.
Early Retirement Programs
The average age of the U.S. workforce is increasing.
Baby boomers are not retiring early for several reasons:
improved health of older people
a fear that Social Security will be cut
mandatory retirement is outlawed
Many employers try to induce
voluntary attrition among older
workers through early
retirement incentive programs.
McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.
Employing Temporary Workers
Hiring temporary workers helps eliminate a labor shortage.
Temporary employment affords firms the flexibility needed
to operate efficiently in the face of swings in demand.
Other advantages include:
temporary workers free a firm from many administrative tasks
and financial burdens
temporary workers are often times tested by a temporary
agency
many temporary agencies train employees before sending
them to employees
McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.
Outsourcing and Offshoring
Outsourcing is an organizations use of an outside
organization for a broad set of services.
Offshoring is a special case of outsourcing where the jobs
that move actually leave one country and go to another.
To help ensure the success of outsourcing:
outsource only those jobs that are repetitive, predictable, and
easily trained.
Choose an outsourcing vendor that is large and established.
Jobs that are proprietary or require tight security should not be
outsourced.
It is a good idea to start small and monitor constantly.
McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.
Affirmative Action Planning
It is important to plan for various subgroups within a labor
force.
A comparison of the proportion of workers in protected
subgroups with the proportion that each subgroup
represents is called a workforce utilization review.
The steps required to execute an affirmative action plan are
identical to the steps in the generic planning process
discussed earlier.
McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.
The Human Resource Recruitment
Process
Job Choice
Recruitment Influences
Job
Choice
Applicant
Characteristics
Personnel
Policies
Recruiter Traits
and Behaviors
Recruitment
Sources
Vacancy
Characteristics
McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.
Personnel Policies
Characteristics of the vacancy are more important than
recruiters or recruiting sources.
Personnel Policies vary:
Internal versus External recruiting
opportunity for advancement
Market leader pay strategy
Employment-at-will policies- either party can terminate the
relationship at any time
Due-process policy - employees can appeal a termination
decision
Image advertising
McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.
Recruitment Sources
Internal Sources -
Faster, cheaper,
more certainty
External Sources -
New ideas and
approaches
Direct Applicants
and Referrals -
self selection,
low cost
Newspaper Advertising -
large volume, low
quality recruits
Electronic Recruiting -
the Internet
Public & Private
Employment Agencies -
headhunters, can be
expensive
Colleges and Universities -
campus placement services
JOBS
JOBS
McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.
Recruiters
Functional Area
HR- versus operating area-
specialist
Traits
warm and informative
Realism
realistic job preview, honesty
McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.
1. Provide timely feedback

2. Avoid rude behavior

3. Recruit in teams

Steps to Enhance Recruiter Impact
1. Provide timely feedback

2. Avoid rude behavior

3. Recruit in teams

McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.