Plan and Recruit Human Resources

Chapter 05 - Planning for and Recruiting Human Resources
Chapter Five: Planning for and Recruiting Human Resources
Welcome to your guide to teaching Chapter Five, Planning for and Recruiting Human
Resources!
This guide will provide you with a chapter summary, lecture outlines, solutions to in-chapter
case questions, suggested use of internet exercises and self-assessments from the online
learning center, video resource notes and discussion questions, and suggested uses for the
PowerPoint slides contained in your Instructor Resources.
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Instructor’s Manual Highlights:
Chapter Five Roadmap

We hope you find each chapter of your Instructor Manual practical and useful, but also,
exciting! You can adapt the chapter text, the PowerPoints, and the video to work in an online
class environment, a guided independent study environment, or a face to face or on-ground
environment.
When presenting Chapter Five, have the students first read the chapter and encourage them
to absorb the “big picture” of Human Resource Planning and Recruiting.
Use the PowerPoint for Chapter Five to frame your lecture. This Instructor’s Manual will
provide you with a suggested placement of the PowerPoints alongside your Lectures.
Then, have your students watch the Video Case on the “HotJobs.com” or “Balancing Act:
Keeping Mothers on a Career Track,” and then facilitate an in-class or an on-line discussion
highlighting the lessons contained in that Case.
Have students read and discuss the Cases and their respective Questions.
Have students validate their knowledge of the chapter by working through the Discussion
Questions at the end of the Chapter.
Lastly, have students review, journal, or discuss the Key Vocabulary Terms at the end of the
chapter.
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ROADMAP: THE LECTURE
PLANNING FOR AND RECRUITING HUMAN RESOURCES
Chapter Summary
This chapter explores how organizations carry out human resource planning. At the beginning,
the chapter identifies the steps that go into developing and implementing a human resource
plan. Each subsequent section of the chapter has a focus on recent trends and practices, such
as downsizing and outsourcing, which are prevalent to human resource management.
Throughout the remaining sections, an exploration into the recruiting process will be
undertaken. At the end of the chapter, a discussion will be presented on the role of human
resource recruiters.
Learning Objectives
After studying this chapter, the student should be able to:
1. Discuss how to plan for human resources needed to carry out the organization’s strategy.
2. Determine the labor demand for workers in various job categories.
3. Summarize the advantages and disadvantages of ways to eliminate a labor surplus and
avoid a labor shortage.
4. Describe recruitment policies organizations use to make job vacancies more attractive.
5. List and compare sources of job applicants.
6. Describe the recruiter’s role in the recruitment process, including limits and opportunities.
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I. Introduction
The opening vignette of the chapter provides two different examples of human resource
planning and recruiting. In the automotive industry, because sales in the United States
have been the lowest volume in almost a decade, organizations seek cost savings by
cutting their workforce. Conversely, accounting firms actively compete to fill entry-level
jobs with qualified candidates. These two examples illustrate how trends and events that
affect the economy also create opportunities and problems in obtaining human
resources.
Discussion Question and Suggested Response
1. Can you provide other examples of industries, like the automotive industry, that are
likely in retrenchment mode with the persistent downturn in the economy?
Conversely, can you think of industries that are actively competing for talent?
Student responses may vary, but suggestions include the retail and manufacturing
industries. As companies outsource, these industries are likely to downsize.
Alternatively, industries such as healthcare, and particularly occupations such as
home health aide and nursing, are likely to be recruiting.
II. The Process of Human Resource Planning
1. Organizations should carry out human resource planning so as to meet business

objectives and gain an advantage over competitors.
2. Human resource planning compares the present state of the organization with its goals
for the future, then identifies what changes it must make in its human resources to meet
these goals. The changes may include downsizing, training existing employees in new
skills, or hiring new employees.
3. Figure 5.1, Overview of the Human Resource Planning Process, identifies the stages
of the human resource planning process.
PPT Slide 5:
Figure 5.1: Overview of the Human
Resource Planning Process
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A. Forecasting
1. The first step in human resource planning is forecasting. This is defined as the
attempts to determine the supply and demand for various types of human
resources to predict areas within the organization where there will be labor
shortages or surpluses.
2. Forecasting supply and demand can use statistical methods or judgment.

Statistical methods capture historical trends in a company’s demand for labor. In
situations where statistical methods are of little use, the organizations must rely on
the subjective judgments of experts.
3. Forecasting the Demand for Labor: An organization forecasts demand for

specific job categories or skill areas. There are several ways of making such
forecasts:
a. Trend analysis, which is constructing and applying statistical models that

predict labor demand for the next year, given relatively objective statistics from
the previous year. These statistics are called leading indicators, which are
objective measures that accurately predict future labor demand. They may
include measures of the economy, actions of competitors, changes in
technology, and trends in the composition of the workforce.
b. Statistical planning models are useful when there is a long, stable history that
can be used to reliably detect relationships among variables. These models
almost always have to be complemented with subjective judgments of experts.
4. Determining Labor Supply: Determining the internal labor supply calls for a
detailed analysis of how many people are currently in various job categories or
have specific skills within the organization.
a. One type of statistical procedure that can be used for this purpose is the
analysis of a transitional matrix. This is a chart that lists job categories held
in one period and shows the proportion of employees in each of those job
categories.
b. Table 5.1 provides an example of a transitional matrix. Matrices such as the

one indicated in Table 5.1 are extremely useful for charting historical trends in
the company’s supply of labor. More importantly, if conditions remain
somewhat constant, matrices can be used to plan for the future.
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PPT Slide 9:
Table 5.1: Transitional Matrix – Example
for an Auto Parts Manufacturer
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c. Historical data may not always reliably indicate future trends. Thus, planners
need to combine statistical forecasts of labor supply with expert judgments.
d. Besides looking at labor supply within the organization, planners should

examine trends in the external labor market.
5. Determining Labor Surplus or Shortage: Based on the forecasts for labor

demand and supply, the planner can compare the figures to determine whether
there will be a shortage or surplus of labor for each job category. Determining
expected shortages and surpluses allows the organization to plan how to address
these challenges.
B. Goal Setting and Strategic Planning
1. The second step in human resource planning is goal setting and strategic
planning.
2. The purpose of setting specific numerical goals is to focus attention on the

problems and provide a basis for measuring the organization’s success in
addressing labor shortages and surpluses. The goals should come directly from
the analysis of labor supply and demand.
3. For each goal, the organization must choose one or more human resource
strategies.
4. Table 5.2 shows major options for reducing an expected labor surplus and
avoiding an expected labor shortage. The options differ widely in their expense,
speed, and effectiveness.
PPT Slide 15:
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Table 5.2: HR Strategies for Addressing a

Labor Shortage or Surplus
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5. Another consideration in choosing an HR strategy is whether the employees

needed will contribute directly to the organization’s success. Organizations are
most likely to benefit from hiring and retaining employees who provide a core
competency, which is a set of knowledge and skills that make the organization
superior to competitors and create value for customers.
6. Downsizing: This is the planned elimination of large numbers of personnel with

the goal of enhancing the organization’s competitiveness. The primary reason
organizations engage in downsizing is to promote future competitiveness.
According to surveys, organizations do this by meeting four objectives:
a. Reducing costs
b. Replacing labor with technology
c. Mergers and acquisitions
d. Moving to more economical locations
7. Some indications suggest that downsizing efforts have not lived up to

expectations. In one survey, 80 percent of the firms that had downsized later
replaced some of the very people that had laid off. In one Fortune 100 firm, a
bookkeeper making $9 an hour was let go. Later, the hired her back as a
consultant for $42 an hour.
8. There are several reasons why so many downsizing efforts fail to meet
expectations. These reasons include:
a. Negative results
b. Loss of talent
c. Disrupts the social networks
d. Need to rehire
e. Survivors become self-absorbed and afraid to take risks
f. Negative publicity
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9. Many problems with downsizing can be reduced with better planning.
10. Reducing Hours: One way to spread the burden more fairly is cutting work hours,
generally with a corresponding reduction in pay.
11. Early-Retirement Programs: These are another way to reduce a labor surplus.
Such programs are a way to encourage older workers to leave voluntarily by
offering early-retirement incentives.
12. The average age of the U.S. workforce is increasing. There are several forces
that fuel the drawing out of older workers’ careers such as:
a. Improved health
b. Decreased physical requirements of jobs
c. Fear of Social Security being cut
d. Insufficient employer-sponsored pensions
e. Age discrimination laws
f. Outlawing of mandatory retirement ages
13. Many organizations are moving from early-retirement programs to phased-

retirement programs. In these programs, the organization can continue to enjoy
the experience of older workers while reducing the number of hours that these
employees work as well as the cost of those employees.
14. Employing Temporary and Contract Workers: The most widespread methods
for eliminating a labor shortage are hiring temporary workers and outsourcing
work.
15. Temporary Workers: Temporary employment is popular with employers because

it gives them flexibility and lowers costs.
16. Agencies that provide temporary employees may handle some of the tasks
associated with hiring, such as testing and training,
17. Temporary workers may offer benefits not available from permanent workers such
as bringing an objective point of view to the organization’s problems and
procedures and providing a great deal of experience gained while working in other
organizations.
18. To benefit from using contract or temporary workers, organizations must

overcome the disadvantages associated with this type of labor force. One
drawback is that tension often exists between temporary and permanent
employees.
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19. Ways in which organizations can better manage the situation of contract or
temporary workers include:
a. Complete downsizing efforts prior to bringing in temporary workers
b. Avoid treating temporary workers as second-class citizens
20. Employee or Contractor?: A company can obtain workers for limited

assignments by entering into contracts with them. Independent contractors do not
receive company benefits such as health insurance and vacations. Using
contractors can result in savings, even if the contractor works at a higher rate of
pay. It is important to verify that the arrangement will meet the legal requirements
and the Internal Revenue Service website (http://www.irs-gov) is a good place to
start.
HR How To: USING TEMPORARY WORKERS AND CONTRACTORS
When using contractors, employers should be mindful of the timing and the way that the
do so. Because employees may perceive contractors (temporary workers) as a threat to
their own job security, a company should complete any downsizing efforts before
bringing in temporary or contract workers. A decent time interval needs to occur before
temporary workers are introduced. If an upswing in demand follows a downsizing, the
organization should begin meeting that demand by granting overtime to core employees.
Extended stretches of overtime will eventually tax the fulltime employees so they will
accept using temporary workers to help lessen the load. Also, the organization should try
to select non-threatening temporary workers who enjoy temporary assignments.
1. Identify some of the pitfalls of bringing in contractors too soon after a layoff.
Bringing in contractors too soon after a layoff could be seen as a threat to the job
security of the surviving employees. This may lead to a lack of cooperation and in
some cases, it could lead to outright sabotage. Additionally, bringing in contractors
too soon could lead to the surviving employees associating the downsizing effort with
the new contractors, who could be seen as outsiders brought in to replace old friends.
21. Outsourcing: Contracting with another organization to perform a broad set of

services is called outsourcing.
22. A major reason for outsourcing can save money is that the outside company
specializes in the services and can benefit from economies of scale.
23. Outsourcing is logical when an organization lacks certain kinds of expertise and
doesn’t want to invest in developing that expertise.
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24. Technological advances in computer networks and transmission have speeded up

the outsourcing process and have helped it spread beyond manufacturing areas
and low-skilled jobs.
25. Outsourcing manufacturing may make good sense in the short term, but it may
ultimately hurt U.S. firms’ competitiveness due to a decreased lack of in-house
knowledge and expertise.
26. Organizations that are interested in outsourcing should plan how they will avoid
problems like giving up direct control of a particular operation. Other problems
include quality-control issues, security violations, and poor customer service.
27. Overtime and Expanded Hours: Organizations facing a labor shortage may be
reluctant to hire employees, even temporary ones, or to commit to an outsourcing
arrangement. They may choose to expand working hours and pay overtime to
current employees instead. However, overtime is most suited for short-term labor
shortages.
C. Implementing and Evaluating the HR Plan
1. The final stage of human resource planning involves implementing the strategies
and evaluating the outcomes.
2. When implementing the HR strategy, the organization must hold some individual
accountable for achieving the goals.
3. In evaluating the results, the most obvious step is checking whether the
organization has succeeded in avoiding labor shortages or surpluses. The
evaluation should identify which parts of the planning process contributed to
success or failure.
D. Applying HR Planning to Affirmative Action
1. Many organizations have an HR strategy that includes affirmative action to

manage diversity or meet government requirements.
2. Affirmative-action plans forecast and monitor the proportion of employees who

are members of various protected groups. The planner can compare the
proportion of employees who are in each group with the proportion each group
represents in the labor market. This type of comparison is called a workforce
utilization review. The organization can use this process to determine whether
there is any subgroup whose proportion in the relevant labor market differs
substantially from the proportion in the job category.
3. The steps in a workforce utilization review are identical to the steps in the HR
planning process shown in Figure 5.1.
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eHRM: TALENT MANAGEMENT AT NORTH SHORE-LONG ISLAND JEWISH HEALTH

SYSTEM
This vignette highlights how North-Shore Long Island Jewish Health System (NS-LI) uses a
computerized talent management system. This system helps NS-LI in its recruiting efforts, by
gathering information on the organization’s HR goals, recruiting efforts, employee performance
reviews, and more. Using data from the system, NS-LI is making better hiring decisions that
match applicants to jobs, so turnover has fallen.
1. According to the information presented in this case, what are the advantages of using a
computerized talent management system, particularly in a tight labor market?
The system helps the company make better hiring decisions which has resulted in
reduced turnover. The system also helps track needs and existing resources while
planning for the future. The system also shows users how HR efforts in one area affect
results across all areas, particularly the hiring of high-performing employees.
III. Recruiting Human Resources
1. The role of human resource recruiting is to build a supply of potential new hires that the
organization can draw on if the need arises.
2. Recruiting consists of any practice or activity carried on by the organization with the
primary purpose of identifying and attracting potential employees.
3. Because of differences in companies’ strategies, they may assign different degrees of

importance to recruiting. In general, all companies have to make decisions in three
areas of recruiting: personnel policies, recruitment sources, and the characteristics
and behavior of the recruiter. Figure 5.2 shows how these aspects of recruiting can
have different effects on whom the organization ultimately hires. Personnel policies
influence characteristics of the positions to be filled. Recruitment sources influence the
kinds of job applicants an organization reaches. And the nature and behavior of the
recruiter affect the characteristics of both the vacancies and the applicants.
PPT Slide 20:
Figure 5.2: Three Aspects of Recruiting
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IV. Personnel Policies
1. An organization’s personnel policies are its decisions about how it will carry out human
resource management, including how it will fill job vacancies.
2. Several personnel policies are especially relevant to recruitment:
a. Recruiting existing employees to fill vacancies or hiring from outside the

organization
b. Meeting or exceeding the market rate of pay
c. Emphasizing job security or the right to terminate employees
d. Images of the organization conveyed in its advertising
A. Internal versus External Recruiting
1. Opportunities for advancement make a job more attractive to applicants and

employees.
2. As personnel policies, decisions about internal versus external recruiting affect the
nature of jobs. Promote-from-within policies signal to job applicants that the
company provides opportunities for advancement.
B. Lead-the-Market Pay Strategies
1. Pay is an important job characteristic for almost all applicants. Organizations have
a recruiting advantage if their policy is to pay more than the current market wage for
a job.
2. Increasingly, organizations that compete for applicants based on pay do so using

forms of pay other than wages or salary.
C. Employment-at-Will Policies
1. Within the laws of the state where they are operating, employers have latitude to set
policies about their rights in an employment relationship. A widespread policy
follows the principle of employment at will, which holds that if there is no specific
employment contract saying otherwise, the employer or employee may end an
employment relationship at any time, regardless of cause.
2. An alternative to employment at will is to establish due-process policies. These

policies formally lay out the steps an employee may take to appeal an employer’s
decision to terminate that employee.
3. In decisions about employment-at-will policies, organizations should consider not

only the legal advantages of employment at will but also the effect of such policies
on recruitment.
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D. Image Advertising
1. Advertising designed to create a generally favorable impression of the organization

is called image advertising.
2. Image advertising is especially important for organizations in highly competitive

labor markets that perceive themselves as having a bad image.
4. Whether the goal is to influence the perception of the public in general or specific
segments of the labor market, job seekers form beliefs about the nature of the
organization well before they have any direct interviewing with these companies.
Best Practices: ROOM TO BLOOM AND GROW AT FOUR SEASONS
This vignette highlights Four Seasons Hotels and Resorts, which is known worldwide for its
luxurious hotels and impeccable service. The company has been repeatedly named one of
Fortune magazine’s best companies to work for. The company has a culture of promoting from
within, and this vignette presents the case of Elizabeth Knox, who moved from director of room
service to director of catering through a circuitous internal path. Knox, in order to learn the skills
to be successful in the catering end of the business, moved from her management job to a
lower level position, starting from the ground up. Knox ultimately became the catering director.
1. Explain the relationship between its internal promotion policies, as presented by this
case, and the fact that Four Seasons has made Fortune magazine’s best places to work
for several years.
Because the culture is to promote from within, Four Seasons demonstrates to

employees that it is committed to their growth with the company. This likely results in
highly engaged and committed employees. The case of Elizabeth Knox provides
evidence of that engagement.
V. Recruitment Sources
1. Another critical element of an organization’s recruitment strategy is its decisions about

where to look for applicants.
2. The method and audiences the organization chooses for communicating its labor needs
will determine the size and nature of the labor market the organization taps to fill its
vacant positions.
3. Figure 5.3 summarizes major sources from which organizations draw recruits. Each
source has advantages and disadvantages.
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A. Internal Sources
1. An organization may emphasize internal or external sources of job applicants.
2. Internal sources are employees who currently hold other positions in the
organization.
3. Organizations recruit existing employees through job postings – communicating

information about vacancies on bulletin boards, in employee publications, on
corporate intranets, and anywhere else the organization communicates with
employees.
4. For the employer, relying on internal sources offers several advantages such as:
a. Generates applicants well known to the organization
b. Applicants are relatively knowledgeable about the organization’s vacancies
c. Faster and less expensive than external recruiting
B. External Sources
1. Organizations often have good reasons to recruit externally such as:
a. No internal recruits available
b. Bring in new ideas or new ways of doing business
2. Organizations often recruit through direct applicants and referrals, advertisements,

employment agencies, schools, and Web sites.
3. Direct Applicants and Referrals: Direct applicants are people who apply for a
vacancy without prompting from the organization. Referrals are people who apply
because someone in the organization prompted them to do so.
4. One advantage is that many direct applicants are to some extent already “sold” on
the organization. This process is called self-selection. A form of aided self-
selection occurs with referrals.
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Did You Know? Four in Ten Positions Are Filled with Insiders
In a survey of large, well-known businesses, respondents said over one-third of positions are
filled with people who already work for the company and accept a promotion or transfer.
1. What are the benefits of filling a position with an internal source? What are the
limitations?
Internal sourcing has several advantages. It generates applicants who are well known to
the organization. The applicants are relatively knowledgeable about the organization’s
vacancies. Internal sourcing is also cheaper and faster than looking outside the
organization. Conversely, internal recruiting can lead to a workforce whose members all
think alike and therefore can be slow to innovation.
5. Many job seekers use social networks to help find employment.
6. A benefit of such sources is that they cost less than formal recruiting efforts.
Considering these combined benefits, referrals and direct applicants are among the
best sources of new hires.
7. Some employers offer current employees financial incentives for referring applicants
who are hire and perform acceptably on the job. Other companies play off their
good reputations in the labor market to generate direct applicants.
8. A major downside of referrals is that they limit the likelihood of exposing the
organization to fresh viewpoints.
9. Sometimes referrals contribute to hiring practices that appear unfair such as

nepotism. This is the hiring of relatives.
10. Advertisements in Newspapers and Magazines: These ads typically generate a

less desirable group of applicants than direct applicants or referrals and do so at
greater expense.
11. Electronic Recruiting: In recent years employers have shifted their spending on
job advertisements away from print ads to online job advertising. Online recruiting
generally involves posting career information at company Web sites to address
people who are interested in the particular company and posting paid
advertisements at career services to attract people who are searching for jobs.
HR Oops! When Social Networking Gets Too “Social”
Social networking sites such as Facebook and LinkedIn are useful for job seeking, networking
and recruiting tools. However, there are drawbacks. Recruiters can get sloppy by relying too
much on easy assumptions about what they see. Applicants should use good judgment when
posting information on their sites.
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Questions
1. What kinds of information do you think recruiters can legitimately expect to learn on a
social networking site? What would they have to learn elsewhere?
Recruiters could learn about the applicant’s affiliation with professional organizations,
and they could learn about their hobbies and interests that complement their career
goals and aspirations. However, recruiters should not make assumptions about work
history, particular qualifications, or references. This is the kind of information that a
recruiter should go deeper into the details of the potential candidate’s background.
2. How do you protect yourself from appearing unprofessional when you use social
networking sites or other public Internet communications?
Some answers are arguably obvious. Do not post pictures that are inappropriate; do
not post jokes or make comments that contain profanity, vulgarity, or cultural
insensitivity. Clearly, do not post information that would portray irresponsibility or lack
of ethics and character. Do not badmouth a current or past employer, colleague(s),
or client(s).
11. Public Employment Agencies: Employers can register their job vacancies with
their local state employment office and the agency will try to find someone suitable,
using its computerized inventory of local unemployed individuals.
12. The government also provides funding to a variety of local employment agencies.
13. Private Employment Agencies: Private employment agencies provide much the
same service as public employment agencies, but primarily serve the white-collar
labor market.
14. Another difference between the two types of agencies is that private agencies
charge employers for providing referrals.
15. For managers or professionals, an employer may use the services of a type of
private agency called an executive search firm (ESF). People often call these
agencies “headhunters”.
16. Colleges and Universities: On campus interviewing is the most important source
of recruits for entry-level professional and managerial vacancies. Participating in
university job fairs is another way of increasing the employer’s presence on
campus.
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C. Evaluating the Quality of a Source
1. In general, there are few rules that say what recruitment source is best for a given
job vacancy. It is wise for employers to monitor the quality of all their recruitment
sources. One way to do this is to develop and compare yield ratios for each
source. This ratio expresses the percentage of applicants who successfully move
from one stage of the recruitment and selection process to the next.
2. Another measure of recruitment is the cost per hire.
3. Table 5.3 looks at examples of how HR professionals can use these measures.
PPT Slide 29:

Table 5.3:
Results of a Hypothetical Recruiting Effort
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VI. Recruiter Traits and Behaviors
The recruiter affects the nature of both the job vacancy and the applicants generated.
Many applicants approach the recruiter with some skepticism and sometimes discount
what the recruiter has to say. The recruiter’s characteristics and behaviors seem to
have limited impact on applicants’ job choices.
A. Characteristics of the Recruiter
In general, applicants respond more positively to recruiters whom they perceive as

warm and informative. The impact of other characteristics of recruiters including their
age, sex, and race, is complex and inconsistent.
B. Behavior of the Recruiter
1. Many studies have looked at how well realistic job previews – background
information about jobs’ positive and negative qualities – can help organizations
minimize turnover among new employees.
2. For affecting whether people choose to take a job, the recruiter seems less
important than an organization’s personnel policies that directly affect the job’s
features.
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C. Enhancing the Recruiter’s Impact
1. Although recruiters may have little influence on job choice, this does not mean
recruiters cannot have an impact. Researchers have tried to find conditions in
which recruiters do make a difference. Based on this research, an organization can
take several steps to increase the impact that recruiters have on the people they
recruit such as:
a. Can provide timely feedback
b. Can avoid behaving in ways that convey the wrong impressions about the
organization
c. Can recruit with teams rather than individual recruiters
2. Figure 5.4 provides examples of behaviors for recruiters to avoid.
PPT Slide 33:
Figure 5.4:
Recruits Who Were Offended by Recruiters
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ROADMAP: Thinking Ethically

Citizens First?
This case explores how the H1-B Visa program, which allows U.S. corporations to hire
employees from outside the United States, who have exceptional talent. Although many accept
this practice as a business necessity, the recent economic downturn has many wondering if
companies in the U.S. should be expected to fill positions with U.S. workers before they should
be allowed to look overseas.
Questions:
1. How, if at all, do a company’s ethical obligations to employees from its own country differ
from its ethical obligations to employees who are citizens of other countries?
Responses to this question will vary by student, but should show knowledge and
consideration of the H1-B program’s intent, which was to permit employers to hire
exceptional talent outside the U.S. Since the number of graduates in math, science, and
technology in the U.S. continues to trail far behind projections for the number of people
needed with these skills, a case could be made that a company is not ethnically bound
to hire a lesser qualified U.S. citizen over a non-U.S. citizen who is more qualified for a
job requiring these skills.
2. Should U.S. companies that have laid off U.S. workers try to hire only U.S. workers?
Why or why not?
Responses can vary, but students can offer arguments similar to the one made in
question one, above. A company should be permitted to hire the most qualified workers,
and if they are unable to find qualified workers in the U.S., then they are not under an
ethical obligation to lower their hiring standards in order to hire a U.S. worker. However,
a case could be made that given two equally qualified candidates, where one is a U.S.
citizen and one is not, that the company has an ethical obligation to hire the U.S. citizen.
3. For a company making decisions to increase or decrease its workforce, what priority
should it give to the following considerations: (a) business advantage; (b) equal
employment opportunity; and (c) being a good citizen, caring about the well-being of its
country’s people. How, if at all, can these considerations be balanced?
Student responses may vary but it is perhaps most evident that all of these
considerations should be taken into account to the extent possible.
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ROADMAP: CASE STUDY
ROADMAP: Chapter Vocabulary
Core Competency
Direct Applicants
Downsizing
Due-Process Policies
Employment-at-Will
Forecasting
Job Posting
Leading Indicators
Nepotism
Outsourcing
Realistic Job Preview
Referrals
Transitional Matrix
Trend Analysis
Workforce Utilization Review
Yield Ratio
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ROADMAP: Review and Discussion Questions

1. Suppose an organization expects a labor shortage to develop in key job areas over the
next few years. Recommend general responses the organization could make in each of
the following areas:
a. Recruitment
b. Training
c. Compensation (pay and employee benefits)
When an organization anticipates an upcoming labor shortage, new human resource

strategies must come into play at the organization. The following responses could be
undertaken to alleviate the problem in these specific areas: Recruitment – select new
employees carefully while availability remains high and indoctrinate them into the
organization, recruit more widely and through a variety of methods such as Internet
recruiting, and utilize other nontraditional recruiting sources to fill organizational needs;
Training - develop a training program that will produce “home grown” employees from
within the company who can be taught a variety of job skills in order to fill the gap when
supply is diminished; Compensation – maintain a competitive compensation/benefit
system in order to attract the best of the available candidates and modify the existing
system in order to diminish the affect of perceived inequity within the organization.
2. Review the sample transitional matrix shown in Table 5.1. What jobs experience the
greatest turnover (employees leaving the organization)? How might an organization with
this combination of jobs reduce the turnover?
A matrix such as the sample presented in Table 5.1 is a chart that lists job categories
held in one period and shows the proportion of employees in each of those job
categories in a future period. It answers the following questions: “Where did people
who were in each category go” and “Where did people now in each job category come
from?”
Based on the information provided by Table 5.1, sales representatives are the jobs with
the most indicated turnover within the organization. An organization with this
combination of jobs may reduce turnover by providing training and preparation to
individuals in order to offer promotion availability.
3. In the same transitional matrix, which jobs seem to rely the most on internal recruitment?
Which seem to rely most on external recruitment? Why?
The jobs that seem to rely the most on internal recruitment are the sales manager
positions. The matrix data indicates that sales manager positions are primarily filled
through internal promotions. The information provided by the matrix also indicates the
sales apprentice positions rely on external recruitment. There is no internal talent
available to fill the apprentice positions, so the organization must recruit from outside
sources.
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4. Why do organizations combine statistical and judgmental forecasts of labor demand,

rather than relying on statistics or judgment alone? Give an example of a situation in
which each type of forecast would be inaccurate.
Statistical methods capture historic trends in a company’s demand for labor while
judgment methods rely on the expert’s subjective reasoning. Organizations combine
these two methods in order to generate the most accurate predictions of labor demand
that is possible.
An example of when the statistical method would not be accurate is a company that is
just beginning operations. There would be no historical information to utilize in order to
make future predictions. Utilizing judgment may not be accurate when the environment
is so unstable that neither past experience nor expert judgment would provide a reliable
base of information.
5. Some organizations have derailed affirmative-action plans, complete with goals and
timetables, for women and minorities, yet have no formal human resource plan for the
organization as a whole. Why might this be the case? What does this practice suggest
about the role of human resource management in these organizations?
Organizations may have derailed affirmative action plans because they must. For
instance, they may be government contractors or be under a court-ordered decree that
forces them to have such a plan. There are no legal requirements for human resource
planning, therefore many organizations may not possess the expertise to recognize the
need for one or the know-how to plan for one. This practice indicates the need for
deeper involvement of the human resource department within the operations of the
organization as a whole.
6. Give an example of a personnel policy that would help attract a larger pool of job
candidates. Give an example of a personnel policy that would likely reduce the pool of
candidates. Would you expect these policies to influence the quality as well as the
number of applicants? Why or why not?
The responses provided will vary. However, all responses should indicate
understanding of the concepts. A suggested example for a personnel policy that would
attract a larger pool of candidates would be to offer a method for career progression and
advancement. An example of a policy that would likely decrease the candidate pool
would be to offer a pay-rate that is below the market rate.
Personnel policies do indeed influence the quality as well as the number of applicants for
the organization. Candidates have certain expectations and needs when they apply to
an organization. Policies that do not meet these needs or expectations can negatively
impact the number and type of candidates responding.
7. Discuss the relative merits of internal versus external recruitment. Give an example of a
situation in which each of these approaches might be particularly effective.
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Merits of internal recruitment are that the organization will be more familiar with the
motivation and work habits of the candidate and it provides motivation to employees
since internal promotions do occur. Merits of external recruitment include bringing fresh
ideas and expertise into the organization. An example of when internal recruitment
might be particularly effective is when the labor supply is very low and there is a high
level of competition. An example of when external recruitment might be particularly
effective includes when the organization needs innovative and modern ideas in order to
remain competitive within the market.
8. List the jobs you have held. How were you recruited for each of these? From the
organization’s perspective, what were some pros and cons of recruiting you through
these methods?
The individual responses will vary, but each response should demonstrate
understanding of the chapter concepts.
9. Recruiting people for jobs that require international assignments is increasingly

important for many organizations. Where might an organization go to recruit people
interested in such assignments?
Some colleges and universities have majors in international trade or business. Students
often have a double major in a foreign language and business. These individuals are
more likely to be interested in going abroad. Thus, recruitment at colleges and
universities could provide candidates. People who have language skills other than
English may also be a possibility, particularly if they have lived in other countries.
Placement of job advertisements in special-interest magazines may prove helpful.
10. A large share of HR professionals have rated e-cruiting as their best source of new
talent. What qualities of electronic recruiting do you think contribute to this opinion?
The student responses given for this question will vary. However, all answers provided
should demonstrate the individual student’s understanding of the chapter concepts on
electronic recruiting. Students should mention in particular, the fact that electronic
recruiting expands the labor market from which the organization can draw candidates.
11. How can organizations improve the effectiveness of their recruiters?
The impact that recruiters have on the people they recruit include: (1) the organization
can have recruiters provide timely feedback. Applicants dislike delays in feedback and
can draw negative opinions about the organization without timely feedback being
provided to them, (2) organizations can have recruiters who avoid behaving in ways that
might convey the wrong impression about the organization, and (3) the organization can
recruit with teams rather than individuals.
5-23
ROADMAP: BusinessWeek Case

DirectEmployers Association: New Direction for Online Job Search
This case discusses a non-profit organization, DirectEmployers Association, founded by Bill

Warren. This organization is designed to lower the costs that employers pay to list positions and
make the process easier and more fruitful for applicants.
Questions:
1. What advantages does this new system from DirectEmployers Association offer to big
companies? What advantages does it offer to small companies?
For big companies, it provides them a more cost effective way to advertise their jobs.
Even though the cost of an ad at Monster.com is $395 per job posting, for a large
company that hires thousands of workers a year, the cost of listing all of their open jobs
can approach $1 million. For small companies, it can offer cost effectiveness but it can
also offer more visibility of their company’s opportunities. Since DirectEmployers
Association plans on domains that are occupation as well as location specific, a smaller
company might be able to attract a job seeker who comes upon their listing under one or
both of these types of domains.
2. How would you expect the introduction of this system to affect employers’ use of the
various recruiting methods described in this chapter?
The introduction of this type of system would probably not affect the other ways that
employers recruit but over time it might reduce the extent to which employers’ use
commercial job boards, as they become accustomed to its features and benefits and as
job seekers learn and use it.
3. Imagine you are recruiting for a mechanical engineering job at a small manufacturing
company in North Carolina and have decided to post the job opening on this system.
What information would you want to include in order to present your position most
effectively to desirable candidates?
Student responses can vary, but should be well-reasoned. The information to include
would be information about the company, the location of the position, the desired
knowledge, skills, abilities and other qualifications of the position. Also important to
include are the procedures for applying for the position, as well as the contact
information of the recruiter or HR department, and the deadline for applications.
5-24
ROADMAP: End of Chapter Case

Apple’s Make-vs.-Buy Decision
Case Summary
This case scenario explores the recent moves made by Apple that are ostensibly intended to
bring the design of their microchips back in-house.
Questions:
1. Given the ideas presented about Apple’s strategy, what HR actions would be most
suitable for supporting that strategy? (Consider especially the options in Table 5.2).
Student responses can vary, but suggestions could are most likely to be new external
hires, since they need the technological talent to design microchips. Outsourcing would
not make sense, since part of their strategy is to keep their design secrets a secret.
2. What challenges would you expect to be most significant for Apple’s HR staff in meeting
these human resource requirements?
Student responses will vary, but look for evidence that the student can provide a
rationale. Suggestions include identifying the locations to recruit, and employment
appropriate screening and testing mechanisms to ensure they bring in high performing
talent.
3. What sources of job applicants would you recommend that Apple use to meet the needs
described here?
It would probably make most sense to use external sources such as direct applicants
from the company web site and job boards. It would also make sense to ask for
employee referrals.
5-25
ROADMAP: Video Case

Video Case: Companies Realize It Pays to Keep Mothers on Track (2:22)
Amid the anticipation of having a baby, many expectant women face a big decision: whether to
stay home with their child or come back to work. When they opt to stay home, the result for
employers is a costly loss of skilled employees. As highly-qualified, experience workers leave
to care for their children, the “mommy drain” has prompted many companies to take innovative
steps to stop it.
Fewer new mothers are returning to work, according to the U.S. Census Bureau. Of those who
do, nearly one fourth go back not to their previous employer but to another company, often
making a lateral move to a competitor with similar compensation, hours, and responsibilities.
Many women, looking for flexibility, go to smaller firms or start their own businesses.1 When a
woman doesn’t go back to her job after having a baby, HR departments must recruit and hire a
replacement. One talent management group estimates that it costs companies as much as
$75,000 to replace an employee with a $50,000 annual salary.2 Additional costs potentially
result from job coverage, absenteeism during maternity leave, and productivity loss.
How can companies reduce turnover and the burden on the HR staff? The answer is by
providing meaningful support to employees from the time the pregnancy is announced. Support
can mean paid maternity leave and unpaid extended leave, as well as incentives to return to
work, such as onsite child care, provisions for lactation, flexible scheduling, and telecommuting.
Bank of America offers as many as eight weeks’ parental leave at full pay, for both mothers and
fathers. Accenture enables women to take extended maternity leaves through a program in
which employees set aside part of their pay to finance up to three extra months of leave, with
benefits. For one Accenture manager, who was able to use the leave plus vacation time to get 7
months off with her new baby, the long leave and the option to return to work part time kept her
from quitting.3
Flextime keeps many working moms on the job. “Family comes first,” explains a bank
purchasing coordinator who is able to set her own hours as long as she completes her work.
Like many U.S. businesses, her employer, Milwaukee’s Pyramax Bank, offers flextime to all
employees. The policy helps workers balance work and home and brings significant returns to
the company. “We save on interview time, training time, ramp-up time, mistake time,” says bank
executive Monica Baker.
Large companies in accounting, consulting, and finance are implementing creative programs to
fill the need for skilled workers. The programs, for both women and men, draw more women
because skilled women are more likely than their male counterparts to leave high-paying jobs.
One study of nearly 14,000 employees found that women ages 25 to 40 making over $75,000 a
year were almost 20 percent more likely to leave their jobs than men. Other research shows that
women taking career breaks are out of the work force for an average 2.2 years, and they will
return to work fairly quickly if they have a feasible and appealing setup.4 At Booz Allen Hamilton,
an internal rotation plan allows consultants who want a break from extensive travel to do
substantive work in an internal position. For one woman returning from maternity leave,
switching from being a consultant on the road two to four days a week to working in the office as
a business development director has enabled her to progress on a career path. Other
companies are changing performance-based pay plans, by pro-rating annual targets for
example, to make sure women do not lose out on bonuses and incentives because they have
taken maternity leave.5
5-26
When Deloitte & Touche management realized that women were significantly underrepresented
in the company’s upper ranks, the firm launched an initiative to advance women. The
company’s “Personal Pursuits” program, begun in 2004, enables top-performing women to take
leaves of up to five years and offers mentoring, training, and the chance to do paying projects
during their leaves. Cathy Benko, who heads the initiative, says the program has been very
promising so far.6 If a skilled professional’s personal pursuits mesh with loyalty to her employer,
everybody benefits.
Discussion Questions
1. How does the “mommy drain” affect human resource planning?
2. Which of the incentives mentioned in the case would be the most successful in keeping
working moms on the job or recruiting them?
References
1
Sue Shellenbarger, “The Mommy Drain: Employers Beef Up Perks to Lure New Mothers Back to Work,” Wall Street Journal,
September 28, 2006, p. D1.
2
Aaron Crecy, “How to keep moms a part of the workforce,” Business Insurance, May 7, 2007, p. 27.
3
Wall Street Journal, September 28, 2006.
4
5
6
Sue Shellenbarger, “Employers Step Up Efforts to Lure Stay-at-Home Mothers Back to Work,” Wall Street Journal, February 9,
2006, p. D1.
5-27
ROADMAP: IT’S A WRAP!
Your students can now REVIEW, APPLY, and PRACTICE the topics that you covered
in Chapter Five with the following segments:
REVIEW
Chapter learning objectives
Narrated lecture and iPOD content
Test Your Knowledge: Recruitment Sources and Stages of the Strategic HRM Process
APPLY
Managers Hot Seat segment “Diversity: Mediating Morality”
Video case on “Balancing Act: Keeping Mothers on Track”
Self-Assessment: Performance Appraisal Characteristics Questionnaire
Web Exercise: Texas Instrument’s Fit Check
PRACTICE
Chapter Quiz
5-28
Small Business Case: For Personal Financial Advisors, a Small Staffing Plan with a Big
Impact
This case describes the decision of Robert J. Reed, a financial planner in Covington, Louisiana,
to recruit a planner to work with him so that he could grow his business, and focus on managing
the investments.
Questions
1. Is a company ever too small to need to engage in human resource planning? Why or
why not? Discuss whether you think Robert Reed planning his hiring strategy at an
appropriate time in the firm’s growth.
Since Reed’s firm was only a two-person office, his decision to hire another planner
demonstrated the fact that a firm is never too small to need to engage in human
resource planning. Reed assessed what his goals and objectives were, and that he
wanted someone to complement his strengths (of managing investments), so he
carefully selected Lauren Gadkowski. Reed’s hiring strategy was done at the perfect
time, because he wanted to be able to focus on managing the investments and he
wanted to grow the company in a way that would free more time for him to spend with
his family.
2. In Table 5.2, review the options for avoiding a labor shortage, and discuss how well the
options besides new hires could have worked as ways for Reed to reach his goals for
growth. As you do so, consider qualities of a financial-planning business that might be
relevant (for example, direct client contact and the need for confidentiality).
It is unlikely that other options besides new hires could have worked for Reed. Overtime
would not make sense as a strategy because he wanted more free time. Temporary
employees would not make sense because of the relationship-orientation of this
business. Outsourcing would not make sense for similar reasons. Turnover reductions
would not make sense, since there were only two people in the office and he needed
and wanted to grow.
3. Suppose that when Reed was seeking to hire a certified financial planner, he asked you
for advice on where to recruit this person. Which sources would you suggest, and why?
Direct sourcing, just as what Reed did, is perhaps the most appropriate way to recruit for
this position. Reed knew precisely what he was looking for. He wanted a Certified
Financial Planner who had experience plus an interest in all of the planning and advising
tasks except investment management. Reed could also have posted an ad on a job
board and provided the detailed description of the position. Referrals and word of mouth
would also be appropriate suggestions because of the relationships that likely evolve
among colleagues in the same industry.
5-29

Plan and Recruit Human Resources

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Plan and Recruit Human Resources

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Chapter 05 - Planning for and Recruiting Human Resources

Chapter Five: Planning for and Recruiting Human Resources

Instructor’s Manual Highlights:

Chapter Five Roadmap

ROADMAP: THE LECTURE

PLANNING FOR AND RECRUITING HUMAN RESOURCES

After studying this chapter, the student should be able to:

2. Determine the labor demand for workers in various job categories.

5. List and compare sources of job applicants.

Discussion Question and Suggested Response

II. The Process of Human Resource Planning

1. Organizations should carry out human resource planning so as to meet business

2. Forecasting supply and demand can use statistical methods or judgment.

3. Forecasting the Demand for Labor: An organization forecasts demand for

a. Trend analysis, which is constructing and applying statistical models that

b. Table 5.1 provides an example of a transitional matrix. Matrices such as the

d. Besides looking at labor supply within the organization, planners should

5. Determining Labor Surplus or Shortage: Based on the forecasts for labor

B. Goal Setting and Strategic Planning

2. The purpose of setting specific numerical goals is to focus attention on the

PPT Slide 15:

Table 5.2: HR Strategies for Addressing a

5. Another consideration in choosing an HR strategy is whether the employees

6. Downsizing: This is the planned elimination of large numbers of personnel with

b. Replacing labor with technology

c. Mergers and acquisitions

d. Moving to more economical locations

7. Some indications suggest that downsizing efforts have not lived up to

c. Disrupts the social networks

e. Survivors become self-absorbed and afraid to take risks

9. Many problems with downsizing can be reduced with better planning.

b. Decreased physical requirements of jobs

c. Fear of Social Security being cut

d. Insufficient employer-sponsored pensions

e. Age discrimination laws

f. Outlawing of mandatory retirement ages

13. Many organizations are moving from early-retirement programs to phased-

15. Temporary Workers: Temporary employment is popular with employers because

18. To benefit from using contract or temporary workers, organizations must

a. Complete downsizing efforts prior to bringing in temporary workers

b. Avoid treating temporary workers as second-class citizens

20. Employee or Contractor?: A company can obtain workers for limited

HR How To: USING TEMPORARY WORKERS AND CONTRACTORS

Discussion Question and Suggested Response

21. Outsourcing: Contracting with another organization to perform a broad set of

24. Technological advances in computer networks and transmission have speeded up

C. Implementing and Evaluating the HR Plan

D. Applying HR Planning to Affirmative Action

1. Many organizations have an HR strategy that includes affirmative action to

2. Affirmative-action plans forecast and monitor the proportion of employees who

eHRM: TALENT MANAGEMENT AT NORTH SHORE-LONG ISLAND JEWISH HEALTH

Discussion Question and Suggested Response

III. Recruiting Human Resources

3. Because of differences in companies’ strategies, they may assign different degrees of

PPT Slide 20:

Figure 5.2: Three Aspects of Recruiting

IV. Personnel Policies

2. Several personnel policies are especially relevant to recruitment:

a. Recruiting existing employees to fill vacancies or hiring from outside the

b. Meeting or exceeding the market rate of pay

c. Emphasizing job security or the right to terminate employees

d. Images of the organization conveyed in its advertising

A. Internal versus External Recruiting