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open.lib.umn.edu - 4.3 Recruitment Strategies – Human Resource Management

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4.3 Recruitment Strategies

Learning Objective Explain the various strategies that can be used in recruitment.

Now that we have discussed development of the job analysis, job description, and job specifications, and you are aware of the laws relating to recruitment, it is time to start recruiting. It is important to mention, though, that a recruitment plan should be in place. This plan can be informal, but you should outline where you plan to recruit and your expected time lines. For example, if one of your methods is to submit an ad to a trade publication website, you should know their deadlines. Also of consideration is to ensure you are recruiting from a variety of sources to ensure diversity. Lastly, consider the economic situation of the country. With high unemployment, you may receive hundreds of applications for one job. In an up economy, you may not receive many applications and should consider using a variety of sources. Some companies, such as Southwest Airlines, are known for their innovative recruitment methods. Southwest looks for “the right kind of people” and are less focused on the skills than on the personality of the individual (Carey, 2011). When Southwest recruits, it looks for positive team players that match the underdog, quirky company culture. Applicants are observed in group interviews, and those who exhibit encouragement for their fellow applicants are usually those who continue with the recruitment process. This section will discuss some of the ways Southwest and many other Fortune 500 companies find this kind of talent. Recruiters Some organizations choose to have specific individuals working for them who focus solely on the recruiting function of HR. Recruiters use similar sources to recruit individuals, such as professional organizations, websites, and other methods discussed in this chapter. Recruiters are excellent at networking and usually attend many events where possible candidates will be present. Recruiters keep a constant pipeline of possible candidates in case a position should arise that would be a good match. There are three main types of recruiters: Executive search firm. These companies are focused on high-level positions, such as management and CEO roles. They typically charge 10–20 percent of the first year salary, so they can be quite expensive. However, they do much of the upfront work, sending candidates who meet the qualifications. Temporary recruitment or staffing firm. Suppose your receptionist is going on medical leave and you need to hire somebody to replace him, but you don’t want a long-term hire. You can utilize the services of a temporary recruitment firm to send you qualified candidates who are willing to work shorter contracts. Usually, the firm pays the salary of the employee and the company pays the recruitment firm, so you don’t have to add this person to your payroll. If the person does a good job, there may be opportunities for you to offer him or her a full-time, permanent position. Kelly Services, Manpower, and Snelling Staffing Services are examples of staffing firms. Corporate recruiter. A corporate recruiter is an employee within a company who focuses entirely on recruiting for his or her company. Corporate recruiters are employed by the company for which they are recruiting. This type of recruiter may be focused on a specific area, such as technical recruiting. A contingent recruiter is paid only when the recruiter starts working, which is often the case with temporary recruitment or staffing firms. A retained recruiter gets paid up front (in full or a portion of the fee) to perform a specific search for a company. While the HR professional, when using recruiters, may not be responsible for the details of managing the search process, he or she is still responsible for managing the process and the recruiters. The job analysis, job description, and job specifications still need to be developed and candidates will still need to be interviewed. Fortune 500 Focus In 2009, when Amazon purchased Zappos for 10 million shares of Amazon stock (roughly $900 million in 2009), the strategic move for Amazon didn’t change the hiring and recruiting culture of Zappos. Zappos, again voted one of the best one hundred companies to work for by CNN Money (Sowa, 2011) believes it all starts with the people they hire. The recruiting staff always asks, “On a scale of 1–10, how weird do you think you are?” This question ties directly to the company’s strategic plan and core value number three, which is “create fun and a little weirdness.” Zappos recruits people who not only have the technical abilities for the job but also are a good culture fit for the organization. Once hired, new employees go through two weeks of training. At the end of the training, newly hired employees are given “the offer.” The offer is $2,000 to quit on the spot. This ensures Zappos has committed people who have the desire to work with the organization, which all begins with the recruiting process. Campus Recruiting Colleges and universities can be excellent sources of new candidates, usually at entry-level positions. Consider technical colleges that teach cooking, automotive technology, or cosmetology. These can be great sources of people with specialized training in a specific area. Universities can provide people that may lack actual experience but have formal training in a specific field. Many organizations use their campus recruiting programs to develop new talent, who will eventually develop into managers. For this type of program to work, it requires the establishment of relationships with campus communities, such as campus career services departments. It can also require time to attend campus events, such as job fairs. IBM, for example, has an excellent campus recruiting program. For IBM, recruiting out of college ensures a large number of people to grow with the organization1. Setting up a formal internship program might also be a way to utilize college and university contacts. Walgreens, for example, partners with Apollo College to recruit interns; this can result in full-time employment for the motivated intern and money saved for Walgreens by having a constant flow of talent.

Professional Associations Professional associations are usually nonprofit organizations whose goal is to further a particular profession. Almost every profession has its own professional organization. For example, in the field of human resources, the Society for Human Resource Management allows companies to post jobs relating to HR. The American Marketing Association, also a professional organization, allows job postings as well. Usually, there is a fee involved, and membership in this association may be required to post jobs. Here are some examples of professional associations: Professional Nursing Association Society of Women Engineers International Federation of Accountants Institute of Management Consultants United Professional Sales Association National Lawyers Guild National Organization of Minority Architects International Federation of Journalists (union) International Metalworkers Federation (union) Association of Flight Attendants (union) Labor unions can also be excellent sources of candidates, and some unions also allow job postings on their website. We will discuss unions further in Chapter 12 “Working with Labor Unions”. The key to using this as a successful recruitment strategy is to identify the organizations that relate to your business and to develop relationships with members in these organizations. This type of networking can help introduce you to people in your industry who may be looking for a job or know of someone who needs a job. Human Resource Recall What do you think is the best way to determine the right set of recruitment methods for your organization? What methods would be best for your current job?

Websites If you have ever had to look for a job, you know there are numerous websites to help you do that. From the HR perspective, there are many options to place an ad, most of which are inexpensive. The downside to this method is the immense number of résumés you may receive from these websites, all of which may or may not be qualified. Many organizations, to combat this, implement software that searches for keywords in résumés, which can help combat this problem. We discuss more about this in Chapter 5 “Selection”. Some examples of websites might include the following: Your own company website

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Yahoo HotJobs

Monster

CareerBuilder

JobCentral

Social Media Facebook, Twitter, LinkedIn, YouTube, and MySpace are excellent places to obtain a media presence to attract a variety of workers. In 2007, Sodexo, which provides services such as food service and facilities management, started using social media to help spread the word about their company culture. Since then, they have saved $300,000 on traditional recruiting methods (Sodexo, 2011). Sodexo’s fifty recruiters share updates on Twitter about their excellent company culture. Use of this media has driven traffic to the careers page on Sodexo’s website, from 52,000 to 181,000. The goal of using social media as a recruiting tool is to create a buzz about your organization, share stories of successful employees, and tout an interesting culture. Even smaller companies can utilize this technology by posting job openings as their status updates. This technique is relatively inexpensive, but there are some things to consider. For example, tweeting about a job opening might spark interest in some candidates, but the trick is to show your personality as an employer early on. According to Bruce Morton of Allegis Group Services, using social media is about getting engaged and having conversations with people before they’re even thinking about you as an employer (Lindow, 2011). Debbie Fisher, an HR manager for a large advertising agency, Campbell Mithun, says that while tweeting may be a good way to recruit people who can be open about their job hunt, using tools such as LinkedIn might be a better way to obtain more seasoned candidates who cannot be open about their search for a new job, because of their current employment situation. She says that LinkedIn has given people permission to put their résumé online without fear of retribution from current employers. Creativity with a social media campaign also counts. Campbell Mithun hired thirteen interns over the summer using a unique twist on social media. They asked interested candidates to submit thirteen tweets over thirteen days and chose the interns based on their creativity. Many organizations, including Zappos (Video 4.4), use YouTube videos to promote the company. Within the videos is a link that directs viewers to the company’s website to apply for a position in the company. Facebook allows free job postings in Facebook Marketplace, and the company Facebook page can also be used as a recruiting tool. Some organizations decide to use Facebook ads, which are paid on a “per click” or per impression (how many people potentially see the ad) basis. Facebook ad technology allows specific regions and Facebook keywords to be targeted (Black, 2011). Some individuals even use their personal Facebook page to post status updates listing job opportunities and asking people to respond privately if they are interested. Events Many organizations, such as Microsoft, hold events annually to allow people to network and learn about new technologies. Microsoft’s Professional Developer Conference (PDC), usually held in July, hosts thousands of web developers and other professionals looking to update their skills and meet new people. Some organizations, such as Choice Career Fairs, host job fairs all over the country; participating in this type of job fair may be an excellent way to meet a large variety of candidates. Other events may not be specifically for recruiting, but attending these events may allow you to meet people who could possibly fill a position or future position. For example, in the world of fashion, Fashion Group International (FGI) hosts events internationally on a weekly basis, which may allow the opportunity to meet qualified candidates. Special/Specific Interest Groups (SIGs) Special/specific interest groups (SIGs), which may require membership of individuals, focus on specific topics for members. Often SIGs will have areas for job posting, or a variety of discussion boards where jobs can be posted. For example, the Women in Project Management SIG provides news on project management and also has a place for job advertisements. Other examples of SIGs might include the following: Oracle Developer SIG

African American Medical Librarians Alliance SIG

American Marketing Association Global Marketing SIG

Special Interest Group for Accounting Information Systems (SIG-ASYS)

Junior Lawyer SIG Recruiting using SIGs can be a great way to target a specific group of people who are trained in a specific area or who have a certain specialty. Referrals Most recruiting plans include asking current employees, “Who do you know?” The quality of referred applicants is usually high, since most people would not recommend someone they thought incapable of doing the job. E-mailing a job opening to current employees and offering incentives to refer a friend can be a quick way of recruiting individuals. Due to the success of most formalized referral programs, it is suggested that a program be part of the overall HRM strategic plan and recruitment strategy. However, be wary of using referrals as the only method for recruitment, as this can lead to lack of diversity in a workplace. Nepotism means a preference for hiring relatives of current employees, which can also lead to lack of diversity and management issues in the workplace. For example, the University of Washington offers $1,200 any time a current employee successfully refers a friend to work at their medical centers. Usually, most incentives require the new employee to be hired and stay a specified period of time. Some examples of incentives that can be used to refer a friend might include the following: A gift card to the employee

A financial incentive

Raffles for most referrals These types of programs are called employee referral programs (ERPs) and tend to generate one of the highest returns on investment per hire (Lefkow, 2002). To make an ERP program effective, some key components should be put into place: Communicate the program to existing employees. Track the success of the program using metrics of successful hires. Be aware of the administrative aspect and the time it takes to implement the program effectively. Set measureable goals up front for a specialized program. Accenture recently won the ERE Media Award for one of the most innovative ERPs. Its program has increased new hires from referrals from 14 percent to 32 percent, and employee awareness of the program jumped from just 20 percent to 99 percent (Sullivan, 2009). The uniqueness of their program lies with the reward the employee receives. Instead of offering personal financial compensation, Accenture makes a donation to the charity of the employee’s choice, such as a local elementary school. Their program also seeks to decrease casual referrals, so the employee is asked to fill out an online form to explain the skills of the individual they are referring. The company has also developed a website where current employees can go to track the progress of referrals. In addition, employee referral applications are flagged online and fast-tracked through the process—in fact, every referral is acted upon. As you can see, Accenture has made their ERP a success through the use of strategic planning in the recruitment process. Table 4.1 Advantages and Disadvantages of Recruiting Methods Recruitment Method Advantages Disadvantages Outside recruiters, executive search firms, and temporary employment agencies Can be time saving Expensive Less control over final candidates to be interviewed Campus recruiting/educational institutions Can hire people to grow with the organization Time consuming Plentiful source of talent Only appropriate for certain types of experience levels Professional organizations and associations Industry specific May be a fee to place an ad Networking May be time-consuming to network Websites/Internet recruiting Diversity friendly Could be too broad Low cost Be prepared to deal with hundreds of résumés Quick Social media Inexpensive Time consuming Overwhelming response Events Access to specific target markets of candidates Can be expensive May not be the right target market SIG Industry specific Research required for specific SIGS tied to jobs Referrals Higher quality people Concern for lack of diversity Retention Nepotism Unsolicited résumés and applications Inexpensive, especially with time-saving keyword résumé search software Time consuming Internet and/or traditional advertisements Can target a specific audience Can be expensive Employee leasing For smaller organizations, it means someone does not have to administer compensation and benefits, as this is handled by leasing company Possible costs Can be a good alternative to temporary employment if the job is permanent Less control of who interviews for the position Public employment agencies The potential ability to recruit a more diverse workforce May receive many résumés, which can be time-consuming No cost, since it’s a government agency 2,300 points of service nationwide Labor unions Access to specialized skills May not apply to some jobs or industries Builds relationship with the union Costs of Recruitment Part of recruitment planning includes budgeting the cost of finding applicants. For example, let’s say you have three positions you need to fill, with one being a temporary hire. You have determined your advertising costs will be $400, and your temporary agency costs will be approximately $700 for the month. You expect at least one of the two positions will be recruited as a referral, so you will pay a referral bonus of $500. Here is how you can calculate the cost of recruitment for the month: cost per hire = advertising costs + recruiter costs + referral costs + social media costs + event costs. $400 + $700 + $500 = $1600/3 = $533 recruitment cost per hire. In addition, when we look at how effective our recruiting methods are, we can look at a figure called the yield ratio. A yield ratio is the percentage of applicants from one source who make it to the next stage in the selection process (e.g., they get an interview). For example, if you received two hundred résumés from a professional organization ad you placed, and fifty-two of those make it to the interview state, this means a 26 percent yield (52/200). By using these calculations, we can determine the best place to recruit for a particular position. Note, too, that some yield ratios may vary for particular jobs, and a higher yield ratio must also consider the cost of that method, too. For an entry-level job, campus recruiting may yield a better ratio than, say, a corporate recruiter, but the corporate recruiter may have higher cost per hires. After we have finished the recruiting process, we can begin the selection process. This is the focus of Chapter 5 “Selection”. Key Takeaways HR professionals must have a recruiting plan before posting any job description. The plan should outline where the job announcements will be posted and how the management of candidate materials, such as résumés, will occur. Part of the plan should also include the expected cost of recruitment.

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Many organizations use recruiters. Recruiters can be executive recruiters, which means an outside firm performs the search. For temporary positions, a temporary or staffing firm such as Kelly Services might be used. Corporate recruiters work for the organization and function as a part of the HR team. Campus recruiting can be an effective way of recruiting for entry-level positions. This type of recruiting may require considerable effort in developing relationships with college campuses. Almost every profession has at least one professional association. Posting announcements on their websites can be an effective way of targeting for a specific job. Most companies will also use their own website for job postings, as well as other websites such as Monster and CareerBuilder. Social media is also a popular way to recruit. Usage of websites such as Twitter and Facebook can get the word out about a specific job opening, or give information about the company, which can result in more traffic being directed to the company’s website. Recruiting at special events such as job fairs is another option. Some organizations have specific job fairs for their company, depending on the size. Others may attend industry or job-specific fairs to recruit specific individuals. SIGs, or special/specific interest groups, are usually very specialized. For example, female project managers may have an interest group that includes a discussion board for posting of job announcements. Employee referrals can be a great way to get interest for a posted position. Usually, incentives are offered to the employee for referring people they know. However, diversity can be an issue, as can nepotism.

Our last consideration in the recruitment process is recruitment costs. We can determine this by looking at the total amount we have spent on all recruiting efforts compared to the number of hires. A yield ratio is used to determine how effective recruiting efforts are in one area. For example, we can look at the number of total applicants received from a particular form of media, and divide that by the number of those applicants who make it to the next step in the process (e.g., they receive an interview). Exercises Perform an Internet search on professional associations for your particular career choice. List at least three associations, and discuss recruiting options listed on their websites (e.g., do they have discussion boards or job advertisements links?). Have you ever experienced nepotism in the workplace? If yes, describe the experience. What do you think are the upsides and downsides to asking current employees to refer someone they know?

1“University Students,” IBM, n.d., accessed January 17, 2011, http://www-03.ibm.com/employment/start_university.html.

References

Black, T., “How to Use Social Media as a Recruiting Tool,” Inc., April 22, 2010, accessed July 12, 2011, http://www.inc.com/guides/2010/04/social-media-recruiting.html. Carey, W. P., “Employees First: Strategy for Success,” Knowledge @ W. P. Carey, W. P. Carey School of Business, Arizona State University, June 26, 2008, accessed July 11, 2011, http://knowledge.wpcarey.asu.edu/article.cfm?articleid=1620. Lefkow, D., “Improving Your Employee Referral Program and Justifying Your Investment,” ERE.net, February 21, 2002, accessed July 12, 2011, http://www.ere.net/2002/02/21/improving-your-employee-referral-program-and-justifying-your-investment. Lindow, A., “How to Use Social Media for Recruiting,” Mashable, June 11, 2011, accessed July 12, 2011, http://mashable.com/2011/06/11/social-media-recruiting. Sodexo, “Sodexo Earns SNCR Excellent Award for Innovative Use of Social Media,” news release, December 2, 2009, accessed January 17, 2011, http://www.sodexousa.com/usen/newsroom/press/press09/sncrexcellenceaward.asp. Sowa, C., “Going Above and Beyond,” America’s Best, September/October 2008, accessed July 11, 2011, http://www.americasbestcompanies.com/magazine/articles/going-above-and-beyond.aspx. Sullivan, J., “Amazing Practices in Recruiting—ERE Award Winners 2009,” pt. 1, ERE.net, April 13, 2009, accessed July 12, 2011, http://www.ere.net/2009/04/13/amazing-practices-in-recruiting-ere-award-winners-2009-part-1-of-2.

open.lib.umn.edu - 4.3 Recruitment Strategies – Human Resource Management

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