As the Human Resources Executive of Hotel Services Company, which employees 5000 staff in Australia, it is my task to overhaul the current recruitment selection and employee turnover functions of this organisation. There is evidence of poor matching of new employees to their work roles and rising levels of staff turnover.
In the first part of the essay, I discuss the nature and significance of recruitment, selection and employee turnover functions in an organisation. In the second part I show how I will deal with the Human Resources problems in Hotel Services Co. Given the uncertain outlook for the economy, I have had to do things differently to what would be done in normal times. The timeframe for achieving the goals is given.
RECRUITMENT, SELECTION AND STAFF TURNOVER
In order to make improvements in recruitment and selection, it is important to understand these concepts. Recruitment is "any practice or activity carried on by the organisation with the primary purpose of identifying and attracting potential employee." The aim of a company's recruitment program is to make sure that the company has a number of suitably qualified applicants, applying for the given job vacancy, who would take the job if accepted (De Cieri & Kramer, 2008, p.259). On the other hand, selection, is the actual choosing of organisational members, and concerns the way in which the decision is made (De Cieri & Kramer, 2008, p.275).
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Recruitment is the first step in the process of ensuring staff, as well as the first step in the process of selecting human resources. For selection to be effective there must be a sufficient number of competitive candidates. This means that the objective of recruitment is to identify a high number of employees so the ones who fulfil the requirements can be selected (Buse, M 2009).
Recruitment can be done from within the company (internal) or from outside the company (external) and there are many strategies for conducting recruitment. A lead-the-market pay approach to pay means that the company offers a higher pay than other companies. Image advertising is another strategy where the company promotes itself while it is recruiting new staff members. Sources of recruitment include advertising in newspapers, or through the internet, as well as using government employment agencies or private ones. Universities are a good source of recruitment too. Sometimes applicants directly approach the company for jobs (direct applicants); other times applicants are referred to the company by members of staff (referrals) (De Cieri & Kramer, 2008).
According to Wang and Wang (2009) Effective recruitment strategies are helpful for a company in order to achieve the fit between person and the culture of the organisation, and to enhance the competitive advantage of the enterprise, and thus reduce the employee turnover rate.
Selection is the method by which companies choose people to come into their organisation. Selecting staff needs to be done very carefully, as decisions regarding selection, over the history of an organisation "are instrumental to its ability to survive, adapt and grow" (De Cieri & Kramer, 2008, p.275). Selection becomes very important in a tight labour market, because competitors can take the best candidates and leave the poor ones to the other companies. Picking the wrong person for a position can be disruptive to the organisation and be very difficult and costly to remove them. Selection is usually done in an interview.
According to De Cieri & Kramer(2008) there are five generic standards in any selection process; (1) reliability (2) validity (3) generalisability (4) utility (5) legality. These standards are mainly to do with quantifying characteristics such as physical characteristics, or thinking abilities or features of their personality. These characteristics have to be compared between candidates, and often they are recorded in a numerical form. Reliability is the standard where the judgements of the applicant's characteristics are consistent, and reliable. In other words, if two people have interviewed the applicant, their judgement of the characteristics would be nearly the same. Validity is where the measurement is done of the relevant characteristics of the candidate, and not irrelevant characteristics. This means that the interviewer makes a judgement only about the suitability of the candidate for the job. Generalisability is about how the selection method, if done in one context, is true in other contexts. If we find out something about the candidate in one area, then can it be generalised to another time or another organisation? Utility is about how the information from the interview, or selection is actually useful to the organisation. Finally, legality is a standard where the selection method follows existing laws.
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Selection is usually done by interviews. Here the employer is able to ask probing questions to find out the suitability of the candidate. It is important to follow a consistent method, in interviewing candidates. The aim is to "keep the interview structured, standardised" and ending up with "quantitative ratings on a small number of dimensions that are observable" (De Cieri & Kramer, 2008, p.287).There are two main ways of interviewing - experienced-base and future-orientated. In the first, the candidate is asked how they handled a particular issue in the past, while in the second case the candidate is asked to solve an imaginary problem.
As a part of selection the candidate will be asked to provide biographical data, such as curriculum vitae. Also written references or the contact details of a referee will be required. In some cases, further tests may be necessary - physical ability tests for manual jobs, cognitive ability tests, personality tests, real-life work tests (such as a teacher being asked to do a sample teaching session),honesty tests and even drug tests.
Staff turnover refers to the holding of staff. Turnover can be seen as the number of employees who leave within a given period. This can be of three kinds: employer controlled such as dismissals, redundancies and early retirements; employee led, due to dissatisfaction of varying kinds; or it can be employer and employee uncontrolled (maternity leave, retirement, etc.). Turnover is closely linked to the term "retention" which involves managing in ways which encourage staff to remain in employment with the organisation (Barclays, 2006).
Employer-controlled turnover is also called involuntary turnover (De Cieri & Kramer, 2008).The reasons for involuntary turnover are that the staff member has given a poor performance, the organisation is undergoing changes such as downsizing, or the company may have " outsourced" some of its tasks to another company, perhaps in another country, where the work can be done more cheaply.
In such involuntary turnover of staff, the company must be sure to follow principles of justice, in order not to antagonise the workforce. There three kinds of justice. Distributive justice is also called outcomes fairness and it where employees must feel that their efforts are being treated fairly, so that they get the same treatment as others. Procedural justice is the way in which the turnover of staff is carried out - is it consistent, was there bias, is the information truthful etc? Interactional justice refers to the quality of interpersonal treatment. The company must give explanations, be sensitive, considerate and show empathy (De Cieri & Kramer, 2008).
There are many factors that need to be considered with involuntary turnover. This is an area where staff are experiencing problems and the company is considering if they should stay. Workplace bullying is a problem that can force the company to consider letting staff go (and also causing staff to leave). Drug testing is common in the United States where drugs are a problem in the workplace. Sometimes employees have personal problems and the company offers assistance programmes. In the case of the company downsizing, counselling is offered to staff needing to look for new jobs (De Cieri & Kramer, 2008, p.629).
Voluntary turnover, is where staff members leave of their own accord. This can be an expensive problem for companies, as it costs considerable money to replace and retrain good staff. As companies aim to have more flexibility with regard to employees, many employees feel insecure and have less loyalty to the company (France et al,2009). Often staff leave because of frustration. Where the reason for leaving is due to the staff member's personal disposition, it may be due to poor selection processes, where the staff member was of a negative outlook. This shows how important the selection process is. Another area looked at with regard to retention is how the staff member was recruited. One group of researchers found that the turnover for individuals recruited through personal recruitment sources, such as the recommendation of staff members, was lower early in an employee's tenure than for individuals recruited through formal sources, such as job advertisements (Weller et al, 2009).
In order to make the job more attractive to staff members, to prevent them leaving, the company must set out to increase job satisfaction (Fisk, 2010). This can mean looking at job flexibility, lifestyle choices, career development and salary. Companies organise social activities, mentors, and fund employee development and career management. They survey the staff to find job satisfaction and also do exit surveys when staff members leave.
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So, for valued employees, companies have to try hard to hold on to these staff - staff retention. Ron Graham of Heidrick and Struggles said "You've got to know that stuff about high performers so that you can meet their needs (De Cieri & Kramer, 2008, p.643).
On the positive side, employee relations, training and development, and recruitment and selection HRM functions were found to be significant enablers of corporate entrepreneurship. Of these, employee relations proved to be the most significant driver of innovation in the firms (Edralin, 2010). This shows the impact that good Human Resource Management can have on a company.
HR SOLUTIONS FOR HOTEL SERVICES COMPANY
Hotel Services Company has a problem of poor matching of new employees to their work roles and rising levels of staff turnover. Many staff are plainly not suited to their jobs. The staff turnover of the company was 20% in 2009, which means that 1000 staff were replaced last year. Hotel Services Company has 5000 staff and 50 managers.
We will have to be careful with our changes because the economy is uncertain and we are not sure how our sales will go. However, there is pressure on us to make drastic changes because of the poor performance.
MATCHING EMPLOYEES TO JOBS
With regard to matching of employees to jobs, I will get the managers to select who Hotel Services will retain. We will ensure that all jobs have a position description, listing the key skills required. We will advertise these jobs again within the company then get our employees to list their own skills and write down their job preferences.
In case any staff are alarmed, we will carefully explain before we begin. We will tell our staff that the company faces economic difficulties, and that this has been forced upon us. We will explain that assistance and jobseeking training will be given to any staff member that is not selected. We will tell them that the company has no other choice than to do this, and that we will look after any redundant staff.
For staff that do not have the required skills and therefore are not required, we will invite them to a newly formed job centre, where we will give them jobseeking skills and give them office facilities in order to put in job applications elsewhere.
We will ensure that these staff are informed of our plans and that they understand our wish that the principles of justice- distributive, procedural and interactional justice- are being followed (De Cieri & Kramer, 2008).
RECRUITMENT AND SELECTION
Exit interviews will be arranged for all staff leaving the organisation. These will be conducted by an outside organisation, so that staff will know that their contributions will be private and not give them any trouble. The data from exit interviews will be analysed by our HR department so that we understand the reasons that people are leaving.
Once we know who the managers have selected as key staff, we will have meetings with these staff to let them know that they are valued and needed by the organisation. We will find out what their preferences are and what we need to do to keep them (See "Ongoing Plans for Ending High Staff Turnover."
Recruitment for new positions would be delayed until at least 50% of staff classified as surplus, had left. This is to avoid dissatisfaction. At first, recruitment would be internal and through referrals from company staff. This would increase satisfaction of our existing, valued staff. Some of these staff would be able to move up to a higher position, through internal recruitment. Other staff would be able to refer people they knew. From Weller et al (2009), we know these staff stay longer.
Later when we had exhausted our current staff potential, we will advertise externally, through web and newspaper and contact with recruiters.
Given the economic uncertainty, we will proceed carefully. However, because existing problems are urgent, we need to be very quick with our recruitment and selection. This will be done in the next three months (12 weeks).
Meeting with managers. Later that week we will address all staff
Notices- Staff given a chance to apply for jobs, and describe skills. This is beginning of Internal recruitment process. Deadline is two weeks
Interviews of staff begin- this is beginning of selection process
Managers begin to identify valued employees - based on interviews
Managers discuss results with senior management
Employees told of results
Employment assistance programs begin. Staff not required are encouraged to begin these.
Valued staff are consulted and asked about their requirements
Valued staff are asked if they know of people to fill vacancies. (Recruitment)
Selectionof new replacement staff will begin. Interview panels will be set up.
It will take at least six months for surplus staff to move on. We will make sure that all those staff members are assisted to new jobs, and they will be replaced.
Depending on the success of our staff referral of staff, we will hold off the advertising in the media (external recruitment) until it becomes necessary. In this way, we will not create dissatisfaction among the existing workforce.
ONGOING PLAN TO ENDING HIGH STAFF TURNOVER
Hotel Services Company will begin coaching and mentoring programmes which will be available to all staff. We will set up career development and succession planning. This will be available to all staff, but particularly for managers and the leadership team.
We will introduce performance-based pay, in order to reward high-achieving staff. Also, we would create compensation packages which would allow flexible working hours, study assistance and public acknowledgement of achievements.
Regular team meetings would be held, attended by management. Management must be the driver in this (Trudel, 2009). They would attempt to explain what is happening in the company, and foster an egalitarian approach. This would not be costly, but would send a signal to the workforce that the management is prepared to listen.
A yearly survey of job satisfaction would be carried out, and the results acted upon. We would do an annual audit of HR (Aurel & Irinel, 2009).
All these would be aimed at creating job satisfaction and feedback mechanisms, so that management would quickly get to hear of dissatisfaction and be able to solve problems.