Person Organization fit and Selection Process

Abstract

Human Resources researches have long argued that hiring a successful employee not only requires a combination of relevant experience, technical skills, and abilities of the candidate, but also depends on a close match between a candidate’s personal values with the organizational culture. Currently, the recruitment procedures initially use the computerized system of keyword parsing, matching candidate’s previous experience, technical skills, and abilities (also known as Person-Job Fit) to the job requirements for the vacant position. Based on this match, the Human Resource professionals and hiring managers make their initial selection of the candidates, leaving other important job fit “intangibles” to the later stages of the process. However, under this system, the candidates that may have better Person-Organization Fit characteristics may not even make the initial cut for the personal interview. The proposed study examines the impact on the hiring process when Person-Organization Fit is introduced in the earliest stage of the hiring process, when the candidates are submitting their initial applications. After the hiring manager is provided with the information about job applicant’s Person-Organization Fit, the probability that this job applicant is invited to the initial interview will be assessed.

Chapter 1: Introduction

Finding the “right” employees for an organization is one of the highest priorities for managers and Human Resources professionals to achieve and sustain a competitive edge (Grigoryev, 2006). Organizations have always struggled to retain well-qualified personnel, unrelated to the state of the economy. When the market is on the rise, companies face fierce competition from their rivals to hire the best candidates. These professionals are in great demand and companies must go the extra mile to get them on board and, more importantly, keep them from leaving. During the economic downside, the supply of the workforce is much greater than its demand. Companies frequently become overwhelmed with the number of job applications to review, making the selection process slower and less effective.

Current research has examined recruiting as a tool of organizational effectiveness (Barber, 1998; Breaugh, 1992; Rynes, 1991). Barber defines recruitment as “practices and activities carried on by the organization with the primary purpose of identifying and attracting potential employees” (p.5). He divides the process of recruiting into three main phases: Generating Applicants, Maintaining Applicant Status, and Job Choice. The first stage, Generating Applicants, begins with reaching out to the applicants in order to attract them to the vacant positions in the organization. This stage ends with making an initial selection of candidates. The second stage, Maintaining Applicant Status, focuses on sustaining a candidate’s interest. It starts with the initial selection of applicants and ends when a single candidate has been identified. The final stage, Job Choice, includes persuading a desirable candidate to accept a job offer.

Every stage has an important role in hiring the best available candidate; however, the current study examines the initial stage of the hiring process. The applicant pool can only deteriorate following this stage; hence, the stage of generating applicants would create the greatest possibility for the managers and Human Resources professionals to make the most effective selection decisions (Carlson, Connerley, & Meacham, 2002).

A typical job application includes information about candidate’s technical skills and abilities, relevant experience, and education. Most applicants also included so called “soft skills,” such as an ability to work independently or as part of the team, leadership aptitude, communications skills, etc. This information is meant to demonstrate the potential employer how this candidate will fit their organization, but rarely is taken to consideration until the second and third stages of the recruitment process.

Making a prediction of how the applicant would potentially fit the working environment is an organic part of the traditional hiring process. The approach of aligning the personal values and characteristics with the organizational environment has been thoroughly researched in the scholarly literature (Lewin, 1935; Murray, 1938; Pervin, 1968; Ekehammer, 1974). Kristof-Brown, Zimerman, & Johnson (2005) have defined the concept of Person-Environment Fit as “the compatibility between an individual and a work environment that occurs when their characteristics are well matched” (p.281).

In the realm of recruitment and selection, two common forms of fit have been identified: Person-Job Fit, or the match between an individual and the requirements of a specific job; and Person-Organization Fit, or the match between an individual and broader organizational attributes (Carless, 2005).

Prior to the use of the internet for soliciting candidates, organizations utilized newspaper ads, word-of-mouth, campus recruiting, trade organizations, and job fairs to attract applicants (Pogorzelski, 2003). In relating to the hiring processes before internet became widely available, Pogorzelski described recruitment occurring at a “snail’s” pace. He identified several time consuming steps including “placing an ad, waiting weeks for applicants to reply, and then spending more weeks combing through stacks of resumes to find the right mix of experience, skills, salary requirements, and career goals.” With this long-haul approach, Human Resource departments have struggled to deliver business value of the human capital, to help their companies to efficiently respond to the constantly changing market realities.

A small number of the candidates applying for a position limit companies’ ability to select from the best available talent. Consequently, the jobs have frequently been handed to members of the “good old boys network”, or “an informal system of support and friendship through which men use their positions of influence to help others who went to the same school or college as they did or who share a similar social background,” (Oxford, 2009). The use of an informal social network to fill job vacancies, by its very nature, puts greater emphasis on cultural compatibility, the fit between the candidate and the organization, rather than accentuating candidate’s technical skills and abilities.

With the advanced development of technology in the recent years, the field of Human Resources has gone through a significant makeover. With internet undeniably becoming an integrated part of our everyday life, an absolute majority of the businesses started to adapt the rapidly rising approach of on-line recruiting. Using on-line recruiting has allowed companies to promote their vacant positions over the internet, and let candidates use powerful search engines to find and apply for the positions that match their qualifications and interests.

There are financial benefits to use on-line recruiting. One of its main advantages is that it allows organizations to expose itself to applicants at a fraction of the cost of other job advertising methods (Kaydo, 1999). As an additional financial benefit, the time spent on the recruitment and selection through on-line processes has been estimated to decrease by as much as 25 percent comparing to traditional approaches (Greenburg, 1998).

However, with the extended use of on-line recruiting, the selection process has undergone an unpredicted transformation (Lievens & Chapman, 2009). Technology now allows companies to parse the text of the resumes, looking for a match to keywords (even before the human eye would take a first look at the candidates). Consequently, the entire initial screening process has switched its emphasis to matching the technical skills and related experience (person-job fit), leaving the applicant’s cultural compatibility with the organization, or person-organization fit, to be considered in later hiring stages.

Several researches and human resource practitioners have emphasized the importance of person-organization fit for the successful employment (Tom, 1971; Christiansen, Villanova & Mikulay, 1997; Ryan & Schmitt, 1996). Frequently, the applicant, perceived as the best match for the job during the selection process, based only on the technical skills and experience, cannot stay on the job due to other, non-technical factors (Grigoryev, 2006).

Grigoryev (2006) found that 46% of twenty thousand new hires in 312 companies left their respective organizations within first 18 months. Follow up interviews with more than five thousand of the hiring managers found that only 11% of employees who left their organizations did so due to a lack of technical or professional competence. In fact, other “intangible” issues, such as motivational problems (15%), temperament issues (17%), lack of coachability (26%), and low levels of emotional intelligence (23%) accounted for the reason the new hire left the company. It was not immediately known if those “softer” issues were assessed during the recruitment procedures. However, a high number of employees failing to stay on a job for more than 18 months due to culture-related reasons, suggests that companies should look into improving the selection processes in order to minimize the impact of employee turnover.

The true cost of the employee replacement is not measured only by tangible indicators. Harvard Manage Mentor Series (2005) published the “Worksheet for Calculating the Cost of Replacing a Specific Employee.” It helps managers calculate direct and indirect costs to hire and train a new employee, along with costs of low productivity of this employee while in training. The estimate of the turnover cost range from 25% to 150% of the employee’s annual salary (Schlesinger & Heskett, 1991; PricewaterhouseCoopers, 2006), indicating that whatever the true number is, replacing an employee is an expensive affair for the organization.

Cable and Judge (1996) argued that in order to improve hiring decisions and avoid high turnover costs, organizations should be attracting the candidates whose values, needs, and expectations are consistent with those that are inherent in the organization’s administrative system. Other researchers suggest that interviewers should look to hire people whose values match or are close to matching the organizational values (Person-Organization fit), support important organizational and group goals, and possess the personality characteristics that are consistent with the employer’s so called organizational personality (Bowen, Ledford, and Nathan, 1991; Posthuma, Morgeson, and Campion, 2002). Current recruitment procedures leave assessing these important “intangibles” to the personal interview stage of the process, making the initial selection of the candidates exclusively based on matching technical skills and abilities. However, this approach creates the greater possibility that the applicants who possess a better person-organization fit to the company, but lesser match of skills and abilities, may not even make an initial cut to the personal interview.

The current study examines the potential of introducing the concept of person-organization fit to the initial stage of the selection process. Specifically, this study concentrates on the impact the information about a job applicant’s potential person-organization fit has on the probability of this applicant being selected for an initial interview.

The current chapter introduced the concepts relevant to the purpose the study, its high-level description, and potential benefits. The second chapter reviews relevant literature for the current research. Next, the detailed description of the research methodology will be provided, following by analyzing the results of the study. The document will be concluded with the discussion chapter, summarizing the results and outlining the study limitations, along with proposals for the further research.

Chapter 2: Review of the Literature

The current chapter is dedicated to reviewing the literature relevant for the proposed study. In the beginning of the chapter, the advanced development of the internet and overall technology and its impact to the recruitment process will be analyzed. After that, the concept of a job applicant fit to the working environment and its components will be reviewed. Then, the measurements of fit and application its concept to the selection process will be examined. Finally, the research question and the proposed hypotheses will be stated.

The Impact of Internet and Technology on Recruiting

The rapid development of the online recruiting and using Internet on initial stages of selection process has created many new opportunities for organizations. On-line job boards such as Monster.com, CareerBuilder.com, Dice.com as well as many others has allowed companies significantly reduce costs for advertising of their opening positions. The nature of online advertising lets organizations to convey larger amount of valuable information, enhanced by graphics, video, interactive text, and photos to the prospective candidates for the fraction of the cost the businesses would pay to traditional advertising media such as newspapers, magazines, and professional journals (Allen, Van Scotter, & Otondo, 2004, Lievens & Chapman).

Most of the businesses have also started using their own websites for advertising their vacant positions, creating a one-source view for the candidates to review job requirements for the openings, along with other targeted data such as information about benefit program, organizational culture, corporate values etc. In the last decade, more and more scholars started analyzing how the content and aesthetics of the corporate websites affects the efficacy of the recruitment process. Among the key parameters that make the on-line recruitment effective, researchers name appropriate web site content, aesthetics and appearance and website navigability (Cober, Brown, & Levy, 2004; Cober, Brown, Levy, Cober, & Keeping, 2003; Lee, 2005).

Another important benefit of the online recruitment is an ability to tailor the information about organization for the individual needs of the candidate. Dineen, Ling, Ash, and DelVecchio (2007) have found that when the aesthetically good-looking corporate website contained the customized information about likely fit of the candidate, it would decrease viewing time and recall of the candidates that potentially don’t fit for the organization, thus creating a lesser probability that those candidates will even apply to the open positions there.

This study is especially interesting as it covers one of the areas where on-line recruitment is experiencing considerable drawbacks – many employers have been complaining about the significant increase in applications from unqualified candidates, inflicting additional costs on organizations to screen and filter out those candidates (Chapman & Webster, 2003).

Even though the role of technology in the recruitment process continues to grow, both employers and job applicants still value face-to-face interactions. Chapman et al (2005) argues that employers, implementing effective technology-based screening processes, allow their recruiters to spend more face-to-face time with qualified candidates rather than manually sorting incoming resumes. Traditionally, recruiters use matching of candidate’s knowledge, skills, and abilities to the requirements of the prospective job as a major factor in their hiring decisions (e.g. Caldwell and O’Reilly, 1990; Kristof-Brown, 2000; O’Reilly, Chatman, and Caldwell, 1991; Schmitt and Chan, 1998). In our days, technology-based screenings are robust enough to completely automate these procedures, using keyword matching techniques thus allowing computers to make an initial screening decision to filter out unqualified candidates. After the “initial cut” of candidates is made by the computers, recruiters use face-to-face interviews to make decisions about pursuing candidates, their personal characteristics and values, attempting to make a prediction of how they fit to the hiring organization based on a wide range of “observable” dimensions (Caldwell and Burger, 1998; Rothstein and Jackson, 1984; Kristof-Brown, 2000).

Person-Environment Fit

Research suggests that higher levels of satisfaction and mental and physical well-being occur when there is a good fit between the person and the environment (Dawis & Lofquist, 1984; Holland, 1997). The theory of Person-Environment interactions has been broadly reviewed in the scholarly literature. Lewin (1935) has conceptualized human behavior as a function of the interaction between the person and the environment (B=f [P, E]). Kristof-Brown and colleagues (2005) has later applied Lewin’s concept to the workplace, proposing a definition of Person-Environment Fit (P-E Fit) as “the compatibility between an individual and a work environment that occurs when their characteristics are well matched” (p.281).

In reviewing the literature dedicated to the interactions between an individual and a working environment, the notion of P-E Fit is conceptualized as a broad term, containing various common types (Carless, 2005). Among those types are the match between an individual and the requirements of a specific job, defined as Person-Job Fit; the match between an individual and cultural corporate values of the organization, defined as Person-Organization Fit; a Person-Group Fit, addressing the interactions between individuals in the workplace, and, lastly, a Person-Supervisor Fit, looking into the relationships between supervisor and subordinate (Carless, 2005; Kristof-Brown, Zimmerman, & Johnson, 2005).

The compatibility between individuals and the environment has been viewed by researchers in a variety of ways. Studies distinguish P-E Fit between its complementary and supplementary characteristics. Complementary fit occurs when individual characteristics of the candidate add to the environment what it is missing (Muchinsky & Monahan, 1987). It has also been defined as when an individual or an organization provide the each other what they need (Cable & Edwards, 2004). At the same time, supplementary type is viewed as similarity between individual and environmental characteristics. The results of the study by Cable and Edwards suggest the unique influence of both complementary and supplementary characteristics of fit to predicting outcomes. Research usually links complementary fit to the Person-Job type, while supplementary fit is focused on other types of person-organizational interactions (Kristof-Brown et al., 2005).

In applying the concept of fit to the recruitment and selection domain, research has been mostly concentrated on factors, relating to the candidate evaluation. These factors range from knowledge, skills, and abilities (KSAs) to personality characteristics, values, and applied social skills (Huffcutt, Conway, Roth, & Stone, 2001). The current study will concentrate on the Person-Job and Person-Organization types of the P-E Fit, as they are the most relevant for the selection stage of the recruitment process.

Person-Job Fit

The concept of Person-Job Fit (P-J Fit) can be described as finding a match between an individual’s abilities and the demands and requirements of a specific job (Edwards, 1991). According to a theory of realistic job preview (RJP), accurate and realistic information about a job enables applicants to assess the degree of congruence between their KSA and the job requirements (Wanous, 1980; Carless, 1995). In measuring P-J Fit, researchers use various dimensions, such as the individual’s KSA, interests desired by the job, characteristics of the job, and personality to fit the job (Chuang & Sackett, 2005).

Researchers outline two basic forms of the P-J Fit as the demands-abilities fit and the needs-supplies fit. The demands-abilities fit takes place when an individual’s KSA are matching to the job description. At the same time, the needs-supplies fit occurs when an individual’s needs, wishes, or preferences are met by the job that he or she applies to or performs (Kristof-Brown et al., 2005).

On the selection stage of the recruitment process, the first form is used. Job demands are being outlined in the job description document, which is being matched using computerized keyword parsing system to the KSA of the applicant, listed in his or her resume. Job applicant’s knowledge is assessed in forms of prior course work, job knowledge, and previous job-relevant work experience (Bretz et al., 1993; Hitt & Barr, 1989). At the same time, job applicant’s skills and abilities are evaluated in forms of problem-solving skills, social skills, time management skills, and others (Chuang & Sackett, 2005).

The needs-supplies form of P-J Fit is usually being evaluated during the time of the employment. It has also been emphasized in other human resource research domains, specifically in theories of job satisfaction, well-being, and adjustment (Porter, 1961; Locke, 1969; French, Caplan, & Harrison, 1974; Harrison, 1978; Caplan, 1983).

Person-Organization Fit

The second type of Person-Environment Fit, which addresses the compatibility between individuals and entire organizations, is called Person-Organization Fit (P-O Fit). Research on P-O Fit has been oriented to the areas of job choice, selection decisions, job satisfaction, performance, organization commitment, turnover, and psychological well-being (Kristof-Brown et al., 2005).

For many years researchers have been approaching operationalization of the P-O Fit term from the different angles. Tom (1971) suggested that success of the individuals in the workplace is measured better in organizations that share their personalities, emphasizing individual-organizational similarity as the core of P-O Fit. Other approaches to operationalize P-O Fit included personality-climate congruence (Christiansen, Villanova, & Mikulay, 1997; Ryan & Schmitt, 1996), goal congruence (Vancouver & Schmitt, 1991; Witt & Nye, 1992), and, finally, congruence of values (Chatman, 1989).

While each of those definitions put an emphasis on different objectives, they all have a common ground of finding the compatibility of individual characteristics. The current research will mostly concentrate on value congruency, as it has been the most accepted and validated approach in current literature (O’Reilly, Chatman, & Caldwell, 1991; Kristof, 1996; Verquer et al., 2003; Kristof-Brown et al., 2005)

Measuring Approaches

Researchers differentiate approaches to measure fit into subjective fit, or the perceived match between the individual and environment, and objective fit, defined as the match between the person and environment that exists independently from the perceptions (French, Rogers, & Cobb, 1974). Kristof-Brown and colleagues (2005) later proposed to further distinguish the subjective fit between perceived fit, when a person directly assessing the environment, and subjective fit, when indirect assessments are used.

Research has been indecisive about reliability of either approach due to various criteria, context, and underlying mechanisms used when a measurement type is selected (Kristof-Brown et al., 2005). Piasentin and Chapman (2007) suggested that subjective fit is associated with higher levels of job satisfaction and organizational commitment, and reduced turnover intentions. Other research has shown that recruiters’ judgments of applicant P-J fit are the strongest predictors of recruiters’ hiring recommendations (Kinicki, Lockwood, Hom, & Griffeth, 1990; Kristof-Brown, 2000). Cable & DeRue (2002) have also suggested that objective fit is a less proximate determinant of attitude and behavior. At the same time, other researchers suggest that objective measures of P-O fit are more strongly related to behavioral outcomes (Hoffman & Woehr, 2006; van Vianen, De Pater, & Van Dijk, 2007). The approach used in the current study is based on manipulating objective information about a job applicant’s P-O Fit to determine its applicability to the hiring managers’ selection decision.

Application of the Concept of Fit to the Recruitment Process

Both Person-Job and Person-Organization types of Fit has been linked to the recruitment process in academic research. One of the earliest applications of P-O Fit, the attraction-selection-attrition (ASA) model, suggested that attraction to the company, being selected for hire, and remaining in an organization are determined by the perceived similarity between the individual and the organizational environment (Schneider, Goldstein, & Smith, 1995). Another model, called Organizational Culture Profile (OCP) compares the values that individuals feel are most indicative of them with the values that are most indicative of the organization (O’Reilly, Chatman, & Caldwell, 1991; Cable & Judge, 1996).

Several studies have also investigated the relationships of perceived P-J and P-O Fit to the applicant’s intention to accept the job offer. Cable and Judge (1996) suggested that intentions to accept a job offer were related to a candidate’s perceptions of P-O Fit, but not P-J Fit. Another research, however, demonstrated that in contrast, there was a direct relationship between P-J Fit perceptions and intentions, while P-O Fit perceptions were unrelated to intentions to accept a job offer (Carless, 1995).

Both P-J and P-O Fit have been widely reviewed in the literature in connection to the recruitment domain. Several studies have investigated the significance of the P-J and P-O Fit variables on the interview stages (Adkins, Russel, & Werbel, 1994; Chuang, & Sackett, 2005). These studies demonstrated that P-J Fit was perceived by recruiters as more important than P-O Fit on the initial interview stages. It was also found that the importance of P-J fit became lower from the initial interview to later stages of the process, while the importance of P-O Fit rose with the approaching the final selection of the candidate.

Several studies have looked into correlation of P-O Fit to turnover and job performance, as these characteristics were recognized by the Civil Rights Act (CRA; 1964, 1991) and the Equal Employment Opportunity Commission (EEOC; 1978) as appropriate employment test validation criteria. Huffcutt, Conway, Roth, and Stone’s (2001) conducted a meta-study, demonstrating that high-structure interviews that assess P-O Fit may be related to job performance. Conversely, their finding were challenged by the later study by Arthur, Bell, Villado, & Doverspike (2006), who did not find the positive relation of P-O Fit to the job performance, but suggested that P-O Fit is well correlated as a predictor of the turnover.

Other empirical studies have proved the importance of P-O Fit to the recruiters’ decision-making processes (Gilmore & Ferris, 1989; Rynes & Gerhart, 1990). Research results also suggest that recruiters’ P-O Fit perceptions can be singled as one of the most important factors in predicting hiring recommendations (Cable & Judge, 1997; Kristof-Brown, 2000). However, the concept of P-O Fit has been mostly studied using face-to-face interactions between job applicants and recruiters. The current study examines if the information of the potential P-O Fit, given to hiring managers during the initial selection process, would make an impact to their decision to invite the job applicant on the personal interview. There will be two main hypotheses analyzed in this study:

H1: The information about job applicant’s potential P-O Fit significantly influences hiring managers’ decision to invite this applicant to an initial job interview.

H2: The level of a job applicant’s potential P-O Fit has a direct correlation to the hiring managers’ decisions to invite this applicant to an initial job interview – the higher the level of P-O Fit, the higher the probability that the applicant will be invited.

Chapter 3: Research Method

This chapter describes the research methodology for the current investigation. First, selection of the participants is discussed, followed by a description of the process used to collect data. Next, an explanation of the research procedure is presented. Finally, the research variables and the statistical methods used in data analysis are outlined.

Participants

The online survey will be conducted using a sample of hiring managers and Human Resources professionals. Invitations to participate in the survey will be sent to people who are at least 18 years old, and currently live and work in the United States of America. Participants will also have or have had in the past the responsibilities of initial screening of resumes and of inviting job applicants to an initial interview. No other demographic data will be collected for this study. Approximately 150 participants for the survey will be recruited through the Professional Social Networking websites, such as LinkedIn.com, FastPitch.com, or Naymz.com (see Appendix A).

Data Collection

The current research examines the impact of having information about a job applicant’s potential Person-Organization Fit on the probability of this job applicant being selected by a hiring manager for an initial interview. In order to measure the impact, a quantitative empirical study will be conducted, using an on-line survey as its data gathering instrument.

Brewerton & Millward (2001) state that the survey, as a data gathering method, is perhaps the most common research tool used due to its “low cost, minimal resource requirements and potentially large sample-capturing abilities” (p.99). Surveys are typically used to describe, rather than explain events. However, surveys can be used to explain events when used in an experimental design where the sample or treatment is manipulated (Bowers & Courtright, 1984). The current research utilizes the force choice survey question (Scott, 1968) asking participants to indicate their future behavior.

The use of a web-based survey has recently been compared to the use of traditional surveys (Gosling, Vazire, Srivastava, & John, 2004). Several researchers have argued that web-based surveys are “equivalent” (p.352) to long-used research methods as paper-and-pencil surveys (Piasentin & Chapman, 2007). The current study chose a web-based survey design due to its legitimacy as a data gathering research tool and its ability to closely mimic a real-life, current recruitment process.

Procedure

After receiving an invitation to participate, and agreeing to the informed consent (see Appendix B), participants are randomly assigned either to the Control group or to a one of the three Treatment Groups with approximately equal number of participants in each group. This study uses a simulated environment, including hypothetical company information, a job description for a vacant position, and a job applicant’s resume. The simulated environment will be used to solicit participant response. Survey participants will not be given any information concerning other treatment groups.

The information provided in the survey will consist of five documents given to all participants and one additional document given only to those in a treatment group.

All participants will initially be provided with the informed consent form (see Appendix B), where they will have to indicate whether they agree to participate in the survey. If they choose to participate, they will be provided with the survey instructions, describing the participant’s role in this study (see Appendix C). Next, they will receive a summary of hypothetical hiring organization, and a list of its core corporate values (see Appendix D). The core corporate values were developed using the Organizational Culture P