Recruitment And Selection Processes In Businesses Commerce Essay

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Recruiting and selecting the right people to join an organization has become increasing apparent where people are emphasized as the prime source of competitive advantage (Breadwell, 2007). Recruitment is central to human resource management. Recruitment failure would create difficulties for organization, and have adverse impacts on its profitability and disparity in skills and staffing level. In furtherance, hiring the wrong person into the organization would bringforth effects ranging from inability or incapable to perform the intended tasks to dragging down the effectiveness and efficient of the team to whom this individual is associated to. As Hiltrop (1996) pointed out, hiring competent employees and enhancing competencies through effective human resource practices will boost an organization's capabilities.

The three interdependent primary features of strategic recruitment and selection are strategic integration, a long-term focus, and a mechanism that translates strategic demands into appropriate recruitment and selection specification (Millmore, 2003). In human resource management practices, recruitment and selection are two conjoining activities that formed the process of personnel identification and attraction, which will ultimately result in the choosing of the most suitable candidate to meet the organization's requirement to filling a position (Breadwell, 2007). They are termed as integrated activities where recruitment is a "positive" activity to attract suitable candidates and selection is the "negative" activity of reducing the pool of attracted suitable candidates to find the most ideal one (Whitehill, 1991). Prior to identifying the person, substantial analysis of the job and its nature serves as the foundation to determine the prerequisites to the position that organizations so intend to hire, e.g. education qualification, industrial certification, etc, which are specific to the job. Other factors that may be considered include certain soft-skills, and to an extent physical conditions with due considerations to job discrimination issues.


When organizations have vacant positions to be filled, they can do so through internal recruitment, external recruitment or a combination of both. Internal recruitment can come from current employees who are promoted, transferred, demoted or developed (Stone, 2008). External recruitment on the contrary comes from the supply of people who do not currently work for the organization (Stone, 2008). The decision on which approach to adopt is heavily dependent on the organization's strategy; its strategy fit and the abilities to align their strategies to their internal resources and capabilities and the human resource policies; finding the right fit for the opening job and employee retention strategy (Compton et al, 2009; Grant, 2010).

Internal Recruitment

There are many advantages in promoting internal recruitment. Internal recruitment eliminates costly advertisements used to attractof job seekers via the various forms of public media and the engagement of third party recruiting agents to seek suitable candidates. In addition, recruiting internally facilitates smoother transition, since existing employees are already familiar with staff and functions of various sub-systems, and most importantly, the organizational culture. Their familiarity of the corporate objectives and inter-department relationships would be of great value and advantage (Harries, 2000). With more organizations placing emphasis in employee retention, internal transfer or promotions enhance the retention policies by satisfying employees' need for recognition and ensuring that their individual contribution to the organizations are not overlooked. Transferring between departments can also eliminate the adverse effects of monotonous job natures and provide employees with opportunities for skills development and future promotional prospect as it builds up employee abilities and competencies. Having such favorable environment will naturally prompt employees to reciprocate with increased productivity.

Internal recruitment can be conducted by direct promotion or appointment by management. The downside of having recommendation by management is the abuse of nepotism and favoritisms in the organization (Compton et al, 2009). Having the HR manager to evaluate the internal supply of labour by looking into their skill inventory and reallocate the identified employees to best match their skills and the resources available is another way of recruiting internally. This enables the identification of employees with the high potential and matching skills and experience to available positions and to ensure that the job exposures are tailored to meet individual needs (Stone, 2008). Another method of internal recruitment uses memos and notices within the organization to solicit response for a vacancy, which allows employees to evaluate their own skills against the requirements. This helps to uncover individuals with skills that are yet to be discovered by the management, and thus increases individual morale and satisfaction.

External Recruitment

Global market for talent and competition is fierce (Stone, 2008). When there are no suitable candidates within the organizations, HR managers must tap into the external labour market to identify potential candidates that best fit the requirements of the available or vacant positions. Tapping into the external pool may be beneficial in bringing onboard a fresh perspective that contribute to enhancing the organization capabilities. Organisations that with preference to external believe that external recruitment would, instead of demoralizing existing employees, encourage them to work harder in order to compete with external labour force. At the same time, external recruitment would also minimise internal sabotaging within the organization. The logic is that when an organization is known to be actively seeking within the internal labour force to fill a vacancy, employees will perceive that they suffered no opportunity loss in getting promoted as they assume that everyone else's standards had deteriorated. Negative competition with the objective to diminish or discredit other individuals' performances in order to get recognized would also occur. However, such concerns can be eliminated by adopting external recruitment where such efforts would be useless against external hiring. It would also push employees to keep pace with the international work standard.

The external labour market conditions greatly affect the availability of labour would influence the recruitment strategies. For example, when the labour market is tight, the scarcity of job seekers may prompt organizations to exercise flexibility in matching applicants to the predetermined criterion to ensure successful filling in of vacancies. The priority is to match requirements that are critically essential to the performing the intended job and leniency is exercised for requirements that are deemed to be desirable. This can also result in the inclusion of alternative sources of labour of lesser considerations. Benjamin (2003) highlighted some of this groups that can surprisingly contain talented workers, such as recent retirees, housewives who are re-entering the labour force, career changers, and past employees. Depending on the strategic demands of the organization, targeting various groups of job seekers enhances workforce diversity. In organizations that stress the competitive advantage of knowledge management, the importance of diversity is seldom understated (Thite, 2004). After identifying the desired groups, the next step is to deal with how to attract them.

Attraction, in this context, consist of making known the job vacancy and catching the attention of job seekers from the desired target groups and wooing them to apply for the job.. Traditionally, it was believed that how large the pool of possible candidates being attracted determined the success of recruitment exercises. However, the most important outcome is the number of high-quality applicants attracted to the pool (Jones et al, 2006). Recruitment efforts that produce large pool of qualified candidates, and marrying it with a reliable and valid selection process will influence the quality and skill type new employees process (Huselid, 1995). Employment advertising is commonly used to attract job seekers, either through local newspaper advertising or internet-based recruitment avenues. Technological advancements and widespread internet accessibility prompted the evolution of shift towards internet-based recruitment against the traditional newspaper advertisings. Online recruitment methods are gaining increasing popularity, with advantages such as cheaper cost and shorter recruitment cycle (Beardwell, 2007). Regardless of the medium, the design of the advertisement played an important part in affecting the responses. Jones et al (2006) reiterated the various factors, such as content and size of a job advertisement, which undermines its effectiveness, while Benjamin (2003) discouraged conventional advertisements that lack appeal.

Employee referral is another recruitment method that is effective, yet prone to the adverse effect of workforce uniformity (Ryan & Tippins, 2004). Employee referral recruitment attracts largely like-minded people, limiting the level of diversity and creativity. In contrast, advertising attracts more diverse respondents in terms of attitudes and behaviors. However, 'the proven wisdom is that good employees will usually refer other good people' (Benjamin, 2003), providing some form of assurance compared to totally unfamiliar applicants gathered from job advertisements. To ensure the success of an employee referral program, a rewards system is usually in place to encourage the employees to recommend suitable candidates known to them to fill the vacancies. Other methods of recruitment include engaging job agencies and internship programs. The former offers speedier filling in of vacancies (Beardwell, 2007), but runs a possible risk of external recruiters' lacking in understanding the fit bwteen the candidate and the job; or failure to sell the benefits of working in the organization effectively. Internship programs, on the other hand, allow organizations to recruit people and nurture them into talents needed.

A recruitment exercise is never complete until the selection of suitable candidates is completed. The selection process entails the qualifying of applicants and determining the best match to the vacant position. Ryan and Tippins (2004) presented several techniques available in assessing candidates, such as interviews and ability tests. In identifying the relevant techniques, the reliability and validity are two key factors to consider (Beardwell, 2007), along with the cost of implementation. However, cost considerations should be secondary to the validity of a technique since low validity techniques inhibit good hiring decision, and will eventually incur more cost for the organization in the long run (Ryan & Tippins, 2004). For example, an inadequate investment in the recruitment and selection processes could bringforth incurring more costs and investing more resources to manage poor performers recruited as a result of poor hiring decisions (Millmore, 2003). Ideally, it is desirable that the best be used. However, there are always various constraints challenging any organization in reality and these constraints should be taken into consideration when formulating the selection strategy.

Good hiring decisions are largely dependent on the people involved in the selection process as well. The various stakeholders include the hiring managers, the applicants and any unions or legislative bodies. A 'multi-stakeholder model recognizes that the intricacies and uncertainties surrounding strategically directed recruitment and selection are seen to be best served by the active involvement of all relevant stakeholders' (Millmore, 2003). In additional the evaluation of applicants by the hiring managers or even prospective colleagues, involving applicants in evaluating their job fit through self-selection not only aided in reducing resignation rates, but also achieved increased level of motivation and performance (Peacock, 2008).

Besides good hiring practices, the talent retention can also be achieved through competitive rewards management systems and fair performance management systems. Thite (2004) emphasized the importance of procedural fairness, interpersonal fairness and outcome fairness in the stages of performance management as well as the competitiveness of rewards systems to successfully achieve the motivational effect.

Labour & Hiring Condition in Singapore

Singapore is internationally well known for its dynamic and vibrant labour. The proactive development of labour through governmental policies is constantly creating large pool of educated and skilled labour within the country. Through the last 40 years, the labour pool in Singapore had evolved from one of skills based to one that is knowledge based. In-country educational system had produced many talents in various fields. In 2009, the literacy rate of Singapore's population was determined to be 96.3% according to data from the Singapore Department of Statistics.

The Singapore Government is also actively promoting and transforming the island country into a financial services and transport hub. Mrs Lim Hwee Hua, Minister in the Prime Minister's Office and Second Minister of Finance reinforce this commitment during the address to the Singapore Institute of Accredited Tax Professionals. Having said, the availability of trained and qualified personnel in the financial arena within the country does not pose a critical shortage. However how large a pool an organisation can attract is subjected to available pool's meeting of the organization's job requirements and skills, and matching of the expectations of each individual person.

Singapore' labour laws are governed by the enactment of the Employment Act which addresses common practices for contracts, wages and benefits when hiring in country. The Act is applicable to all workers except for managerial and confidential positions, domestic workers, seamen and governmental employees.

Employees that are earning less than two thousand Singapore dollars per month are not allowed to work more than forty-four hours a week. Under the Act, no employee is allowed to work more than twelve hours in a day unless it is under the circumstances of actual or leading to threats, works that is critical to national defence and security or unforeseen situation that would lead to work being interrupted. It is common that working hours for office based employees start from 9am to 6pm or variants of equal amount of time, with a 45 minutes lunch break sandwiched between.

Overtime wages are usually calculated at 1.5 times the hourly wage rate multiply by the number of hours performed beyond the stipulated working time by the said employee. Work performed on a public holidays is calculated at twice the hourly rate of the wages. This is applicable to employees that earned less than two thousand dollars per month.

Singapore have a total of 12 national holidays which are considered as a non-working days. Holidays that fall on a Sunday would qualify the immediate Monday as a national holiday. The Act also stipulated that a minimum of 7 days of paid-time off or leave are allocated to employees for the first year and the said employee must have served the organization for at least 3 months to qualify for the 7 days. Year to year, an additional one day is added, usually capped at a maximum of 28 days. However, it is a common expectation that at least 12 to 14 days of annual leave is given. Adding on, each employee is entitled to 14 days of medical leave and 60 days hospitalization leave. Conditions attached to these leave are that employees must submit leave certificates issued by medical professionals. While annual paid-time off increases on a year-to-year basis, medical and hospitalization leave remains constant throughout.

Compulsory statutory requirement for hiring in Singapore are the provision of workman compensation insurance that insures employees against mishaps at work, and the contribution of certain percentage of each hired person's monthly gross salary into their Central Provident Fund (CPF) account, in addition to the monthly salary they received. The latter requirement applies only to Singapore citizens and permanent residents. Foreigners holding employment passes are not subjected to this requirement.

While the Act does not stipulate employment benefits that need to be accorded to employees, ignoring common market practices will pose challenges to an organization in their ability to attract talents. The common expectations are:

Payment of 13th month bonus - a bonus payout equivalent to one month's wage is paid to workers who has completed one year of service each year. Workers who have yet completed one year would expect a payout on a pro-rata basis.

Healthcare, personal and well-being benefits - many companies operating in Singapore offer group medical insurances, and it is usually extended to their immediate family, covering personal accident and hospitalisation. Examples of personal and well being benefits includes subsidy for eye wear and dental care services.

Allowances - Certain allowances are paid out by companies for certain job nature, e.g. mobile usage allowances, transportation allowances, internet allowances, etc. These allowances are usually considered based on the needs of the works performed by the employee.

There are no mandatory training requirements stipulated to provide education and training to employees hired. Nevertheless, the Ministry of Manpower for Singapore encourages employers to provide such opportunities to improve job competency, productivity and career advancement through the introduction of various governmental initiatives that covers partially on the training costs incurred by organizations.


In order for BGC to successfully turn the SSC operational, BGC has to analyse and determine the various positions and their corresponding skillsets required to fulfil the obligations of the various positions. This would also include determining the SSC's organisational structure which would translate to identifying the key lead personnel for the various operational requirements, e.g. Accounts Payable, etc. This report reckons that an key prerequisite would be the understanding and experience of the candidates of the financial legislations and practices to the countries that SSC intends to support. It is a general believe that foreign companies based outside the contingency would generally have a good remuneration package with fringe benefits that is somewhat not matchable to the local companies. The report suggests that BGC considers setting the remmueration package to the current practices of the company, and adjust where compliance to local legislation requirements needs to be met. As SSC is a new setup, it is recommended that the hiring of key personnel be done through recruitment agencies, and revaluated by the immediate supervisor responsible for the SSC and corporate HR.

Once completed, the recruited lead personnel would be charge with the responsibility to hire the crew based on the company's existing HR policies and benefits, that are adjusted to local market conditions. Information of salary benchmarking on the various positions should be consulted to determine the ideal payout with due considerations to the organisation's expectation. Depending on the number of postions to be determine, all available methods to attract potential candidates should be utilise, subjected to the availability and abundance of resources.


This paper reviewed several key components critical to the process of recruitment and selection as well as the contextual highlights of hiring in Singapore. In view of Brown Goods pilot project of setting up the SSC, external recruitment is the obvious option to establish the human resources. The soliciting of job applicants in a foreign environment necessitates the use of newspaper or online job advertisements to provide a wider exposure. Considering the job scope of an accounts assistant being highly technically based, the major consideration in qualifying the applicants is the relevancy of their qualifications and experience in accounts handling. The selection of candidates is similarly technically based by way of work samples to assess their job competencies, followed by structured interviews to assess their non-cognitive skills so as to provide a complete evaluation. Employment terms and conditions offered should take into account local legislative requirements and market employment norms to ensure competitiveness in attracting and retaining talents, followed by appropriate performance and rewards management systems.