Recruitment and selection methods and procedures of IBM

Increased globalisation coupled with enhanced customer expectations makes it very difficult for a firm to grow and succeed. Firms need to constantly change the way they react and adapt to this ever changing global environment. Attracting and retaining high quality individuals can lead a firm to have a competitive edge. One of the ways in which a firm can achieve competitive advantage is by attracting and retaining high quality individuals (Newell as cited in Bach, 2005).

Telephone call centres today are part of the ever changing global environment (Callaghan and Thompson, 2002). In recent years there has been increased migration of call centre operations to Asia especially India due to comparatively less expensive labour, infrastructure and technology (Taylor and Bain, 2005). According to Mirchandani (2004), in the year 2003, there were approximately 800 call centres set up in India which employed more than 2 million Indians. This fast growth has caused increased attention from policy makers, the media and academics (Kinnie et al, 2000).

Most of the research relating to call centres has been confined to countries like the UK and the US with a lot of focus on subject areas like work relations, labour processes and emotional labour (Callaghan and Thompson, 2002; Budhwar et al, 2006). On the contrary, a very limited research has been undertaken in the field of recruitment and selection Not much research has been carried out on the recruitment and selection practices and procedures in the Indian call centre context.

Purpose of the research

This research aims at evaluating the recruitment and selection methods and procedures of IBM Daksh, a rapidly growing call centre in India, in a critical way. The aim of this research is to critically evaluate the recruitment and selection practice and procedures in IBM Daksh, which is one of the fastest growing call centres in India.

Company background

IBM Daksh, which is one of the amongst the largest call centres in India, was used for the purpose of the report.

IBM Daksh offers business performance improvement rather than just cost-savings and is a step closer to Business Transformation Outsourcing (BTO) (IBM Daksh website). IBM Daksh focuses on improving business through performance along with cost-savings and is closely moving towards business transformation outsourcing.

In April 2004, IBM Corporation acquired Daksh e-Services to form IBM Daksh. IBM Daksh today serves as a global hub to manage business processes for clients across the world. With 25 service delivery centres in India and the Philippines, IBM Daksh is an integral part of IBM’s Business Process Outsourcing (BPO) delivery network around the world. Today, IBM Daksh employs more than 30,000 people and has won several major awards for employee satisfaction, delivery excellence, innovation, and diversity and inclusivity (IBM Daksh website). IBM daksh today, acts an international hub for managing business processes for customers all over the world. It serves as an integral part to IBM’s business process outsourcing network with 25 service centres in india and the Philippines.

Research objectives:

The following are the research objectives:

RESEARCH QUESTION 1 What are the recruitment methods used in IBM Daksh?

RESEARCH QUESTION 2 What are the selection methods used in IBM Daksh?

RESEARCH QUESTION 3 What are the positive and negative aspects of the recruitment and selection process in IBM Daksh?

Report Structure

The next section of the report will conduct a literature review which will examine various academic perspectives. The third section of the report is the methodology which explains the various methods used and gives a justification for the choice of methods. The third section of the report describes the methodology, detailing the different methods used and gives a justification for the choice of methods.

CHAPTER 2 – LITERATURE REVIEW

This section examines the academic literature within the proposed research area. The aim of the literature review is to look at the various stages of the recruitment and selection cycle. Although all the sections within the literature review are interlinked it has been divided into sections and sub-sections to help guide the reader through the report. Section one will outline the significance of recruitment and selection. Section two will discuss the process of HR planning. Section three will examine the different stages in the systematic approach to recruitment and selection. Section four will explain how HRM contributes to recruitment and selection.

Section 1

2.1 Significance of Recruitment and selection for businesses

In most academic literature the terms Recruitment and Selection (R&S) are used together, however it is necessary at the very onset to explain the difference between the two terms as recruitment and selection are entirely two different functions of HR as they are completely two different functions of HR (Taylor, 2005). According to dowling and schuler recruitment refers to Dowling and Schuler (1990), define recruitment as “searching for and obtaining potential job candidates in sufficient numbers and quality that the organisation can select the most appropriate people to fill its job needs” (cited in Beardwell and Holden, 2001:226). Whereas, “Selection techniques are used to decide which of the applicants is best suited to fill in the vacancy in question” (Taylor, 2005:166). The process of recruitment and selection is considered to be as one of the four fundamental functions of Human resource management; recruitment, training, compensation and employee relations (350). The process of recruitment and selection is considered to be amongst the four fundamental functions of human resource management; recruiting, training, compensation and employee relations.

Hiring competent and proficient individuals is of utmost significance which, solely relies on the effectiveness of recruitment and selection procedures. Having the right people at the right time in the right place, willing and able to work effectively, at a cost that the organisation can afford, is something for which all managers strive for. The significance of this should not be over looked as incorrect R&S decisions can lead an organisation to incur heavy losses in terms of productivity, clients, training and advertising related costs which sum up to almost 30% of an individual’s first year earnings (Bach, 2005). The most important features of R&S are that it should be effective, efficient and fair. Efficient relates to cost effective methods and sources (ACAS, 2010). It is necessary to decide the need for recruitment, the source and the media to be used and at what cost. The process of recruitment can lead to various expenses such as such as advertising, employee referral bonuses, agency fees, staff travel, and relocation costs and recruiters salary. Thus, choosing a cost effective approach is dependent on factors specific to each organisation and the various kinds of vacancies (Marchington and Wilkinson, 2005).It should be effective in attracting a good number of quality of candidates (ACAS, 2010).

Fair means ensuring that the decisions made during the process is based on merit alone (ACAS, 2010). In order to reduce the risks of discrimination lawsuits, organizations should make use of fair and legal procedures (tme). Also, it is essential to consider Legal issues when recruiting, particularly in the design and wording of adverts and in online channels (hrmaw).These three criteria are crucial for organisational success.

Section 3

2.3 Systematic approach to Recruitment and Selection

There seems to be a general agreement within the literature that the most popular approach to recruitment and selection is the systematic approach (Pilbeam and Corbridge, 2002; CIPD, 2009). According to Roberts (1997), a systematic approach to recruitment helps to streamline selection and help decrease cost. It also helps to better organisational performance and foster good employee relations (Pilbeam and Corbridge, 2002). In recent years, organizations are realizing that the failure to recruit employees systematically can impact their success (tme). Adopting a more systematic approach to recruitment and selection helps reduce bias and errors (Bach, 2005). The systematic approach is built on the concept that a system has inputs (candidates), processing units (R&S methods) and outputs (effective employees or unsuccessful candidates). This system is subject to external influences such as labour market conditions, competitor activity and legal obligations (ibid, 2002). Within the system each stage affects and is co-dependent upon the others. For instance, a sophisticated selection tool is useless if the recruitment methods fail to supply a sufficient quality and quantity of applicants (ibid, 2002). The literature review will discuss the systems approach (Table 1.1) described by Pilbeam and Corbridge (2002) to provide a framework for the R&S process. This approach is supported by various other research perspectives.

Table 1.1 – The recruitment and selection sub-systems

Sub-systems

Purpose

Activities

Attraction

Attracting suitable candidates

– Pre-recruitment activity – establishing a case for recruitment; consideration of the labour market

– Use of recruitment methods

– Responding to enquiries.

Reduction

Eliminating unsuitable candidates

– Filtering, screening and short listing.

Selection

Assessing, choosing and appointing a suitable candidate.

– Use of selection methods and techniques

– Making the appointment – offer and

Acceptance

Transition

Converting the successful candidate to an effective employee

– Pre-engagement process

– Induction and appraisal.

Source: Pilbeam and Corbridge, 2002

2.3. STAGE 1: ATTRACTION

Establishing a case for recruitment

According to Plumbley (1985) any vacancy which is created either through resignation, dismissal or increased workload presents management an opportunity and with a choice. ‘The opportunity is freedom to consider whether the job is necessary (and, hence, a chance to re-allot the work). The choice is between recruitment and other courses of action (such as internal promotion or temporary transfer)’ (ibid, 1985 pp:15).

Job analysis, Job descriptions and Person specifications

The next stage after the case for recruitment is established is the process of job analysis, writing up job descriptions and person specifications. According to Robert (1997), job analysis is the basis for effective recruitment and selection. Job analysis is imperative because it provides the information required for two documents: job description and person specification. Job analysis also looks at how each job fits into the organisation, what its purpose is, and at the skills and personality traits required to carry it out. A number of distinct methods such as interviews, questionnaires, diaries and observation are employed for gathering job analysis data (Taylor, 2005).

As stated earlier, from the job analysis the job description and person specification is written. Job descriptions relate to the tasks to be undertaken, whereas person specifications outline the human attributes seen as necessary to do the job. Most employers in large organisations make use of job descriptions and person specifications to draw potential candidates (Taylor, 2005). Person specification can be drawn up using two well known frameworks, Rodger’s Seven Point Plan (1952) and Fraser’s Five-point plan (1966). These frameworks however, include some categories which are inappropriate and potentially discriminatory, for example, categories relating to ‘disposition’ or ‘interests’ (Pilbeam and Corbridge, 2002). Therefore, the recruitment teams in call centres must have a clear understanding of anti-discrimination laws and equality laws before publishing any job description or person specification. Pilbeam and Corbridge, (2002) emphasise the significance of skill’s, aptitude and knowledge included in the person specifications and should specifically relate to job needs.

Competency-based approach

Competency framework is the alternative approach to the job analysis process. This approach has overcome a number of drawbacks of the job analysis/ person specification/ job description process. ‘Competencies’ were defined by Boyzatis (1982) as ‘an underlying characteristic of a person which results in effective and superior performance in a job’ (Taylor, 2005: 156-157). The most significant advantage of the competency framework is its focus on the behaviours of applicants. There is therefore no need to make inferences about personal qualities that might underpin behaviour (Newell and Shackleton, 2001:26 as cited in Marchington and Wilkinson, 2005:169). In addition, the competencies can be related to specific performance outcomes rather than being concerned with potentially inappropriate processes, such as disposition or interests outside work (ibid, 2005). According to an Industrial Relations Survey (IRS) study the most commonly used competencies are team orientation, communication, people management, customer focus, results-orientation and problem-solving (Rankin and Epstein, 2001).

In call centres there is emphasis on social competencies which are essential to ensure an effective interaction between the employee and the customer. `It is this interaction that is crucial to customer satisfaction` (Newell, 2005 as cited in Bach, 2005:116). For example, a detailed case study of recruitment in a call centre was conducted by Callaghan and Thompson (2002) who found that competencies such as communication, customer focus, building relationships and problem solving were important. Despite the many advantages of this approach, critiques suggest that it could lead to a form of cloning where all new recruits tend to behave similarly to those already in the posts; hence diversity is lost (Taylor, 2005).

Recruitment methods

After all the preparatory work is complete, in terms of planning, forecasting and job analysis the stage of recruitment can begin. It is imperative that organisations analyse the costs involved in selecting the methods of recruitment (tme). There are a range of recruitment methods from which call centres must choose, these can be used exclusively or in combination. They are listed in Table 2.The objective of a recruitment method is to attract an appropriate number of suitable candidates at the least cost (Pilbeam and Corbridge, 2002).

Table 1.2 – Recruitment methods

Recruitment Method

Examples

Internal methods

Internal promotion, internal transfers, job rotation schemes, rehiring former staff

Print media

National newspapers, local newspaper, trade and professional journal, magazines

Education liaison

Careers services, career fairs, college tutors

External agencies

Job centres, outplacement consultants, head-hunters, employment agencies, recruitment consultants

Other media

Direct mail, local radio, internet, cinema

Professional contacts

Conferences, trade union referrals, suppliers, industry contacts

Other methods

‘factory gate’ posters, past applicant records, open days, word of mouth, poaching

Source: Taylor (2005: 170)

Recruitment can be internal, which attempts to fill vacancies from the pool of existing workers or external, which recruits individuals from outside, the choice and timing of which varies between organisations. Many organisations today attempt internal recruitment because it is cost effective (Taylor, 2005). Other advantages include building on existing staff’s skills and training and providing opportunities for promotion and development (ACAS, 2010)acas 2009. There are disadvantages, however, of relying on internal recruitment as it can be potentially unfair and discriminatory, since it tends to perpetuate the existing workforce. It also prevents the organisation from bringing in new talent, which can only come through external recruitment (Bach, 2005).

When existing employees are encouraged and rewarded for introducing suitable recruits it is termed as employee referrals (CIPD, 2009). The advantage of this method is that the new recruits are likely to have a better understanding of the organisations culture and values as well as the nature of work as compared to the average recruit. Call centres encourage this method as it is cost efficient (Bach. 2005). However, it is important that employers do not rely on this scheme as it limits attracting a diverse workforce (CIPD, 2009).

Many Call centres attempt external recruitment because internal sources are often not sufficient enough to supply a suitable pool of applications (Newell, 2005 as cited in Bach, 2005). Table 2 lists the different types of recruitment methods. When there is pressure to fill in vacancies very quickly, often methods like employment agencies, job centres, and local papers that advertise positions on a daily basis can be used (Taylor, 2005). The external agencies already have a pool of potential applicants registered with them so they can provide a quick recruitment turn around time (ACAS, 2010). Since many call centres have to fill in vacancies within days they often rely on employment agencies (Kinnie, et al., 2000) who take over a larger part of the recruitment process by advertising, they also sift initial applicants and provide employers with a short-list of candidates (Taylor, 2005).

According to IRS (1997) corporate websites and local newspapers are used universally to attract applicants (used by 75% of organisations) (CIPD, 2009). Job advertisements are quick way of attracting a large pool of candidates. When placing a job advertisement, there are many factors which should be considered like the content, the layout (example – size, position and typeface) and the timing (example – dates). Table 3 provides a suggested content checklist against which the advertisement used in IBM Daksh can later be measured.

Table 1.3: Suggested content for Recruitment advertisements

Content

Organisations name and logo

The job title and brief description of the job (duties involved and main aspects of the person specification, and main aspects of the person specification and any qualifications required)

Where the job is based

The salary (either the amount or scale) any allowances and facilities

An equal opportunities statement

Application procedures, the closing date (and interview date)

Where to get further details

Source: Taylor (2005)

Other ways of attracting applicants include building links with local colleges, working with job centre and holding open days (CIPD, 2009). When deciding which method to use, Taylor (2005) suggests that organisations should consider how precisely the approach adopted will reach its target audience. Recruitment of the right people is the most important role of the recruiters in call centres (Townsend, 2005). Therefore it is of utmost importance to invest time and effort right from the outset of the recruitment process.

STAGE 2 – REDUCTION

The attraction of applicants is succeeded by efforts to narrow down the total number of applications received to a pool of candidates that can be managed effectively in the more detailed assessment stage of selection process (CIPD, 2009). This can be done indirectly through the characteristics of the recruitment activity, and directly through using the person specification criteria. The processes involved are filtering, screening and short listing, by an assessment of the application form or CV (Pilbeam and Corbridge, 2002).

Application forms and Curriculum Vita’s (CV)

The application form and the CV are principle tools for the applicant in the selection process. Many organisations use application forms which allow information to be gathered in a standardised way (Searle, 2003). Some studies have shown it is used in 98 percent of selection projects (Roberts, 2005). With the growth of the internet many organisations now use online applications especially for jobs that receive large volumes of applicants (Searle, 2003).

Most employers make use of both CVs and application forms (Taylor, 2005). From the perspective of the employer there are advantages and disadvantages to both approaches. A CV is an opportunity for candidates to sell themselves and can thus tailor their application in their own way, however this can be a disadvantage as well as candidates could over sell themselves to a potential employer. They may also include irrelevant information in the CVs (ibid, 2005). Application forms, on the other hand provide the organisation with only the information it requests and hence aids the short listing and interview process (Pilbeam and Corbridge, 2002).

Application forms have become so much a part of the process that it is wholly expected by the candidates and taken for granted by the recruiters. According to Roberts (2005: 103) `It is probably one of the most maligned and misused recruitment tools`. Much of the information it requests is for administration purposes which can be collected at a later stage. The application form should focus only on the job and its related selection criteria (Pilbeam and Corbridge, 2002). According to Taylor (2005), the application form should be designed clearly, use concise language and have a good layout. If it is designed carefully and administered sensitively and sensibly it can become an extremely effective part of the overall selection process (Plumbley, 1985).

Short listing

This process reduces the number of candidates proceeding to the selection stage by assessing the application form or CV. Research indicates that this process is often subjective, inconsistent and lacking focus (Roberts, 1997). There are a number of simple principles to guide the construction of a final shortlist. First, assessments should be made against the criteria using the person specification or competency framework and each application can then be rated according to these standards or a scoring system can be used (CIPD, 2009). Second, a shortlist should be of a manageable size in relation to the resources of the organisation and the selection methods being employed (Pilbeam and Corbridge, 2002). Third, contingency arrangements should be made to compensate for candidates who withdraw due to the time spent on short listing (ibid, 2002).

STAGE 3 – SELECTION

The R&S process can be made more systematic however it will unavoidably remain subjective. ‘A structured R&S system with rigour and consistency in the application of selection methods is highly desirable, but the appointment decision remains a matter of human judgement’ (Pilbeam and Corbridge, 2002:139). The selection choice is dependent on factors such as type and level of job, abilities of the manager involved, time required, accuracy demanded and cost (Torrington, et al., 1991). The process should be fair to selected and unsuccessful candidates with a degree of flexibility to ensure its the most appropriate means of selecting a candidate in question (CIPD, 2009). Wrong decisions not only affect the various individuals associated with them (employers, applicants, agencies) but also result to frustration, repetive training and low morale prior to the termination of the newly hired employee. Small organisations are affected more by such decisions, while large scale organisations can retain or relocate the inappropriate placement, such a luxury can be very expensive for small scale organisations (tme).

This section reviews selection methods which relate to those used in IBM Daksh. Many of the methods such as work sampling, assessment centres and graphology are not used by IBM Daksh due to the nature of the work. Hence this section examines interviews and ability tests in detail.

Sound selection decisions ensure the organisations that their financial investments in the employees will pay off (tme). It is important to mention that no single method, regardless of how well it is designed and administered, is capable of producing perfect selection decisions that predict with certainty which individuals will perform well in a particular role. Employers are therefore use a combination of various methods (Marchington and Wilkinson, 2005).

Ability tests

Ability tests or aptitude tests focus on numeric, verbal reasoning, abstract reasoning and logical reasoning (Taylor, 2005). The aim of tests is to increase the quality of selection decisions (Torrington et al, 1991). According to Plumbley (1985) tests can help measure some attributes which are difficult to measure in an interview and thus reduce subjective judgement and of possible human error in the selection process as a whole. According to ACAS (2009) “candidates for telesales/call centre work will almost invariably be asked to undertake a practical test for verbal reasoning. Tests scores should be used to supplement the interview. It is critical that those who administer the tests should be qualified to interpret them hence training for administrators is necessary (Torrington et al, 1991).”

The interview

The purpose of the interview is two-fold. One is to find out if the candidate is suitable for the job, and second is to give the candidate information about the job and the organisation.

There is a general agreement within the literature that traditional selection interviews are poor predictors of future job performance (Torrington et. al, (1999); ACAS, 2010; Plumbley (1985). The term ‘traditional’ refers to unstructured interviews in which the interviewer may ask different sets of questions to different candidates (Taylor, 2005: 210).

Quick judgements are a common pitfall in the use of interviews (Roberts, 2005). According to Webster (1964, as cited in Torrington et al, 1991) interviewers often decide whether to accept or reject a candidate within four minutes, and then look for evidence to justify their decision. Literature recommends that the interviewer spends adequate time in listening to the candidates (ibid, 1991). Another pitfall is the concentration span of interviewers, which tends to drop in the course of the interview and hence it is recommended that note taking helps in continued concentration (Roberts, 2005). Despite the problems associated with interviews, it is one of the most widely used selection techniques, and the validity of face-to-face conversation is high (Torrington et al, 1991). Recent studies by the CIPD have shown that interviews are used in 90 percent of selection processes (Roberts, 2005).

Literature advocates the use of structured interviews rather than unstructured. Research by Barclay (1999, as cited in Pilbeam and Corbridge, 2002) found that structured interviews have recently gained popularity. A structured interview is designed to determine all the relevant information and assess the competencies of the applicant. This method focuses on the match between job and candidate (acas, 2009) which helps better selection decisions and better consistency and fairness in the treatment of candidates (Taylor, 2005).

Job offer and Rejection

It is important to inform all the applicants of the outcome as soon as possible, whether successful or unsuccessful. If the decision is delayed (acas 2009) the candidates should be advised. Unsuccessful candidates should be given feedback on any aspects they could reasonably improve for future success (ACAS, 2010).

For the successful candidates the job offer and acceptance formalises the relationship between the employer and employee. An offer of employment is normally a written document which should include all the features of employment, for example job, hours, start date, pay and benefits (Pilbeam and Corbridge, 2002). Torrington et al. (1991) suggests that it is essential to send the offer letter to the candidate as soon as possible, as the best candidates may have offers elsewhere.

STAGE 4 – TRANSITION

Induction

Induction is used in the workplace context to help employees adjust and acclimatise to their jobs and working environment (CIPD, 2010). According to CIPD (2010) a good induction should consist of the following elements:

Orientation (physical) – describing where the facilities are.

Orientation (organisational) – explaining how the employee fits into the team and how their role fits with the organisation’s strategy and goals.

Health and safety information

Explanation of the terms and conditions

Details of the organisation’s history, culture and values.

A clear outline of the job/role requirements.

A good induction is an important element in contributing to the successful transition from an applicant to an employee (Pilbeam and Corbridge, 2002). It is essential to have a well-designed induction programme to create a good first impression and make the employees feel welcome. It also helps increase employee retention (Taylor, 2005; CIPD, 2010).

Section 4

The importance of HRM in Recruitment and Selection

The human resource department of an organisation plays a vital role in the process of recruitment and selection (Browning et al, 2009). The entire setting of human resource function in hiring candidates is interconnected with the recruitment and the human resources strategy. Human resource managers play a significant role in the recruitment and selection process. It is essential to identify the appropriate candidate requirements and ways to attract them (Bach, 2005). Traditionally, human resource managers were required to administer the entire process of recruitment. The managers were accountable for managing the advertising and monitoring of vacancies, but the human resource managers were not much influential in the overall recruitment process. However, as the need for human resources in organisations is increasing, certain changes in the human resource strategy were incorporated. Human resource managers are delegated the entire responsibility of managing organisational personnel and in such circumstances the process of recruitment and selection takes the first place. It is the basic and major role of any human resource department to hire competent candidates for the organisation (Budhwar and Boyne, 2004).

Human resource activities are directly related to the productivity. Extensive recruitment and selection strategies can lead to an increase in the productivity. Moreover investments in the area of Human Resources are in align with the fiscal progress of the organisation such as training and development, Recruitment and selection (hrmrs). Generally human resource managers consider issues related to HR as significant to organizational success. It is necessary to include line managers in the decision making process with regards to human resources. However, the use of such practices differs from organisation to organisation (hrmrs). it has been found that the integration of HR into the firms strategies, is significantly related to outputs of turnover, productivity and financial performance (hrmrs).

CHAPTER 3 – METHODOLOGY

This section describes the various methods that will be used in this report and will attempt to give a justification for the choice of methods.

3.1 Research Philosophy

Research philosophy relates to the development of