Human Resource Management:

Gaining a Competitive Advantage

Chapter 05

Human Resource Planning and Recruitment

Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin

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Forecasting Stage of HR Planning

Determine Labor Demandderived from product/service demandedexternal in nature

Determine Labor SupplyInternal movements caused by transfers,

promotions, turnover, retirements, etc.transitional matrices identify employee

movements in different job categories over time to chart historical trends in company’s labor supply

useful for AA / EEO purposes

Determine Labor Surplus or Shortage

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Options for Reducing Expected Labor Surplus

Option Speed Human Suffering

FastFastFastFastFastSlowSlowSlowSlow

HighHighHighModerateModerateLowLowLowLow

1. Downsizing2. Pay reductions3. Demotions4. Transfers5. Work sharing6. Hiring freeze7. Natural attrition8. Early retirement9. Retraining

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Options for Avoiding Expected Labor Surplus

Option Speed Revocability

FastFastFastSlowSlowSlowSlow

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Downsizing

Downsizing -planned elimination of large numbers of personnel to enhance organizational competitiveness.

4 Reasons for Downsizing:1. reduce labor costs2. technological changes reduce need for labor*3. mergers and acquisitions reduce bureaucratic

overhead4. organizations change location of where they do

business.* Economy wide, capital spending ratio increased over 300% between 1990-

2010, indicating employers substituting technology for labor.

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Early Retirement Programs

The average age of U.S. workforce is increasing.

Baby boomers are not retiring early due to: improved health fear that Social Security will be cut mandatory retirement is outlawed collapse of the financial and housing markets made

it economically unviable to retire

Many employers try voluntary attrition among older workers through early retirement incentive programs.

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Employing Temporary Workers

Hiring temporary workers helps eliminate a labor shortage and affords flexibility needed to operate efficiently during demand swings.

3 Advantages:1. temporary workers free a company from

administrative tasks and financial burdens2. temporary workers are often times tested

by a temporary agency3. many temporary agencies train employees

before sending them to employees

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Outsourcing and Offshoring

Outsourcing uses an outside organization for a broad set of services.

Offshoring is outsourcing where jobs leave one country and go to another.

To help ensure the success of outsourcing: Choose an established, large outsourcing

vendor. Jobs that are proprietary or require tight

security should not be outsourced. Start small and monitor constantly.

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Affirmative Action Planning

Plan for various subgroups within a labor force.

Workforce utilization review is a comparison of the proportion of workers in protected subgroups with the proportion that each subgroup represents.

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HR Recruitment Process

Job Choice

Recruitment Influences

JobChoice

ApplicantCharacteristics

Personnel Policies

Vacancy Characteristics

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Personnel Policies

Organizational decisions that affect the nature of the vacancies for which people are recruited. Characteristics of the vacancy are more

important than recruiters or recruiting sources.

Personnel Policies vary: Internal versus External

recruiting Extrinsic versus Intrinsic rewards Employment-at-will policies Image advertising

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Recruitment Sources

Newspaper Advertising -large volume, low quality

recruits

JOBS

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Recruiters

Functional Area HR versus operating area specialist

Traitswarm and informative

Realism realistic job previewhonesty

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Summary

HR planning uses labor supply and demand forecasts to anticipate labor shortages and surpluses to enhance organization’s success and reduce human suffering.

HR recruiting creates an applicant pool should a labor shortage occur.

Organizations can use recruiters to influence individual’s perceptions of jobs.

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