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IronStrongs Recruitment, Selection & Placement of Specialist Engineers

Contents Page
Contents Page........................................................................................................................................2 Executive Summary................................................................................................................................i Introduction...........................................................................................................................................2 Results/findings/discussions...................................................................................................................4 Conclusion...........................................................................................................................................12 Recommendations................................................................................................................................13

Executive Summary

The purpose of this report is to identify the external and organisational issues affecting IronStrongs recruitment, selection and placement activities and generate options aimed at improving their practices. IronStrong are located in the Philbara region of Western Australia and are experiencing problems attracting specialist engieneers. Management are expressing dissatisfaction with the performance of recruits and they commonly resign after one to two years of service. The mining industry have been experiencing a people shortage early 2000 and this is expected to worsen over next five years given the demographic challenges faced with a population shortage. Competition is further compounding the attraction problem with demand for engineers in the gas sector growing, and its a more attractive industry. Instability is being created through the inability to fill positions leading to less contracts being placed in the Western Australian region. The attractiveness of the industry has suffered as a result and conditions of employment given the environmental location is also a challenge. Solution may be found through immigration but political debate is leaving Australia with a negative international image. Recruitment, selection and placement (RSP) strategies tie closely to organisational strategy and human resource professionals are struggling to gain credibility and a seat around the boardroom table to contribute in the mining section. A cultural disconnect needs to be investigated given the management dissatisfaction with employees. IronStrong can improve their attraction and retention by gathering valuable feedback internally and externally through job analysis, focus groups and surverying the RSP process from people who have experienced it. Developing a campaign that targets candidates demographically, i.e. women and regionally, i.e. indigenous and rural people, may assist in widening the search. IronStrong would benefit greatly through the use of e-recruitment and building their website presence and online tools for a more fulfilling organisational experience. My research was conducted using academic journals, course text books, general website searching and articles from the Australian Financial Review. I noted a substantial lack of information in regards to the placement process and believe through my experience that there is more notable material that has not been researched academically.

Introduction
Purpose or objective of writing the report To identify the external and organisational issues affecting IronStrongs recruitment, selection and placement activities and provide an evaluation of IronStrongs practices and policies and explore alternatives aimed at improving the attraction and retention of candidates.

Background Information The issues that IronStrong are experiencing have been forecast since early 2000 and is expect to gain momentum over the next five years given the economic boom in the industry. Competition has grown for engineers with Queenslands mines being a more attractive location for the candidates. This compounded by a people shortage is very worrying for the mining. Human resource professionals are gaining credibility and a seat around the boardroom table to contribute to the organisations strategic goals, but my research suggests that this is not applicable to the IronStrong, typical in the mining industry given their lack of engagement strategies with personnel and representation on the boardroom table.

Scope The study was extended to current market conditions affecting the mining industry and RSP theories over the past decade including external factors and organisational issues.

Methodology The material referred to in this study was gathered through reading articles, mainly the Australian Financial Review, a variety of academic journals and human resource manuals on recruitment, selection and place and quoting references from these. Background understanding on the presentation and functionality of mining companies websites was gain through the use of the Internet and projectised through commentary on my personal experience.

Assumptions and limitations The human resource professionals and department currently are and have been acting in an ethical manner and adhering to legislative requirements appropriate to their role. Placement strategy literature was not highly evident in the recommended reading and appears to be an area lacking academic research. Current education of human resource professionals refer to this process as on boarding, extending induction phase, creating a holistic experience of the RSP process from start to finish. Reference to this method is not used due to the lack of academic support. The current process of RSP that IronStrong follow is: Recruitment - advertising in newspapers, website, consultants and word of mouth. Selection - initial culling of applicants not meeting minimum criteria, interviewing using panel of three, second interview with panel of three, decision on candidate. Placement - offer, negotiation, acceptance and induction program involving issuing on employee manual, occupational health and safety training, time in main office and time on site.

Plan The report is divided into four main sections: Clarify the RSP process and the role it plays in an organisation. Exploration of the external environment including current issues. Analyse IronStrongs RSP activities and explore alternatives. Recommended RSP process.

Results/findings/discussions
Recruitment, Selection and Placement Quality policies and practices for attracting, selecting and placing the appropriate employees is vital to business success. Mayson and Storen refer to this as, An organisations ability to develop organisational systems and routines that contribute to the development of its human capital is linked to superior organisational performance. Mayson & Storen citing Delery and Huselid, 1996; Wright, Dunford and Snell, 2001; Wright and McMahon, 1992, (2003), p. 3. The purpose of recruitment and selection is to create a group of qualified job candidates from which to select the best person. In the process, acknowledgment must be made to future staffing needs, job analysis, legislative requirements, fair processes and organisational strategic goals. The purpose of placement is the final step in the process involving the completion of employment contracts and induction program. The recruitment, selection and placement (RSP) steps remain the same for all companies, including the mining sector, however the variables within the process are the actual activities associated with each step. These activities are influenced by internal and external factors.

Mining Industry External Factors Politics impact on RSP through legislation and public debates. Current political views on immigration are having a negative effect on the mining industry with politicians using the media to gain vote. Im sick and tired of federal politicians using cheap political campaigning around population immigration, in particular focused on the politics of western Sydney, to win a few votes, Barrett citing Buswell, (2010), p. 10. This has a direct affect on the mining industry that is experiencing a people shortage. The promotion of these kinds of views can be damaging in the attraction of overseas candidates. Without immigration, Australias labour force would not grow at all in the next 40 years and the supply of labour will fall a long way short of demand, Dodson (2010) p. 5. Immigration policy impacts the mining industry from an economic perspective. The consequences of ill-thought out cuts in immigration would be felt on Australias economic development over the next 10, 20 or 30 years, Dodson (2010) p. 5. Mr Ferguson cautioned that this could fuel inflation, which will have an impact on interest rates. Dodson (2010) p. 5. With not enough people to fill positions in the mining sector, contracts

. . . . may not be filled which directly affects our gross domestic product output, thus driving our . . . economy down and inflation up. In the past the mining industry has been sustained through our . .
domestic reliance on coal and it is expected to continue into the future, Australia will continue to rely on coal as a major source of power. Climate Change Minister Penny Wong said yesterday. Barrett, (2010), p. 10. However, current conditions are such that the mining industry is driving our economy through increased exports particularly to China. Internationally, the demand on our resource sector is continuing, however, The upturn in global energy demand from Asia and a desire for cleaner-burning sources of energy is continuing to drive interest in Australias gas reserves. Williams, (2010), p. 5. The mining industry faces some strong competition and faces challenges with the image of non-environmentally friendly industry and a more socially conscious work force. The biggest challenges that the mining industry face are in the current and forecast employment market demographic, employment patters and employing industries. Firstly, Australia is in the process of a demographic transition characterized by rapid ageing of the population, with an increasing proportion of the population accounted for by older age groups. Lowry, Molloy & Tan, (2006), p. 36. Meaning that there just arent enough people to cater for the work that needs to be done across the board, let along in an industry that is struggling to attract and retain people. Given the specialist area that engineers in the mining industry operate, they are further hindered by the fact that, Over the last decade the Australian minerals industry has experienced a chronic shortage of minerals specialist graduates, especially mining engineers and metallurgical engineers. Lowry, Molloy & Tan, (2006), p. 54. During the financial crisis the attraction rate increase towards the mining industry, during the height of the crisis, in July last year, the Australian Bureau of Statistics reported employment in the mining sector increased by 30 per cent in Queensland alone. Lawson (2010), p. 4. However this trend has changed as businesses recover and competition has return to the job market. While the resources sector, buoyed by soaring commodity prices, is leading the way, all industries reported a big jump in sales and profits last month and are taking on new staff at rates not seen since the height of the pre-crisis boom in late 2008, according to National Australia Banks monthly business survey. Rollins, (2010), p. 1.

IronStrong Organisational Factors The approach that the human resource department takes is crucial to the successful RSP process and A common mistake for HR managers is to concentrate on short-term replacement needs rather than on the organisations long-range human resource requirements. Stone, R.J. (2006), p. 47. Given that IronStrong is not succeeding in this, it should be viewed as an area for improvement and innovation. It would prudent not to question if the human resource activities are strategically aligned given that the choice of candidates has not been successful. Historically, not all human resource professionals are aware of the strategic alignment of their duties and may be performing them as a separate function as opposed to fulfilling a component of their job description. Alternatively, senior management may not see them as integral to the strategic process. A view supported by Hsu and Leat. HR managers in the survey may find such strategic integration important and by implication desirable, in practice it may be very difficult for them to achieve without having explicit written corporate strategies and HRM policies to refer to. Hsu & Leat (2000), p. 416. What is concerning if this is a factor affecting IronStrong is that, corporate disconnects carry high costs. McCune (1999), p. 17. Research has indicated that expectations in regards to living conditions are not ideal in the mining industry with fly in fly out rosters and temporary accommodation built in to part of their entitlement making the placement process of RSP even more complicated. It makes the industry even more subject to instability as discussed in a recent article. About half the workforce walked off the job for eight days earlier this year in a dispute over accommodation. Williams, (2010), p 5. This is further compounded by competitors vying for skilled candidates in a limited pool of people. Western Australia has found itself in the unexpected position of temporarily playing second fiddle to the emerging unconventional gas rush on Australias east coast. Williams, (2010), p. 5. As part of this competition for people, uncertainty in terms of longevity of projects is questionable if projects are jeopardised by the lack of people to complete the work. Demonstrated by the transfer of work to gas based projects. However, the availability and price of natural gas one of the leaders in the commodities export boom have killed other WA projects. Roberts, (2010), p. 65. Portraying this industry at high risk of instability. Internal management style and organisational culture affect the placement of a new recruit. Corporate mismatches or culture clashes can occur. McCune describes this as, a corporate mismatch is the clash between the new hires old culture and the culture of his new company. McCune (1999), p. 17 and Cultures clash because companies have different management styles, ways of doing things and modes of communication. McCune (1999), p. 17.

Possible Areas of Improvement Full Review of Current Systems In order to ascertain the full extent of the problem it is worth exploring the value in obtaining valuable feedback from the human resource departments customers. The Mystery Shop is an excellent tool to quickly ascertain how well the customer is being served. Hart (2006), p. 266. Advantages: A thorough understand of the applicants perceptions would be obtained giving IronStrong valuable information to improve the process and encourage more applicants. A view supported by Robertson and Smith, Applicant perceptions play a key role in recruitment since negative views will inhibit some people from putting themselves forward. Robertson & Smith (2001), p. 451. Disadvantages: Time consuming and expensive.

Job Analysis Job analysis, and resultant job descriptions and person specifications, form the basis for the initial employment of staff, establishment of employee performance standards and their subsequent measurement, and the determination of grade and classification levels and remuneration systems. The traditional role of job analysis within the personnel selection paradigm is to provide a fixed starting point for all subsequent steps in the process. Robertson & Smith (2001), p. 444. Given management has expressed inadequate performance of numerous new recruits it would be pertinent not to perform a full job analysis. Some general techniques are observation, employee diaries or logs, checklists and questionnaires, focus groups and individual or group interviews. Advantages: Management would have an opportunity to have input into the process and possible gain some appeasement in the process. Areas may be identified for improvement, quickly and with relatively minimal investment.

Disadvantages: Job descriptions of other roles may be affected.

E-recruitment IronStrong needs to raise awareness about their company as a whole utilising the Internet to capture a greater pool of applicants. Given they are not attracting a lot of applicants in the initial phase of recruitment suggests that communicating who they are may be part of the problem. Mounting evidence suggests that organizational web sites have become a common resource available to all job seekers. Cober, Brown,, Keeping, & Levy. (2004), p. 624. IronStrong may also use their website to begin the applicants experience with them, by integrating features such as colour, images, sound, video, animation, and interactivity, web site recruitment provides job seekers with a much richer experience than traditional materials. Cober, Brown, Keeping, & Levy. (2004), p. 624. This would assist to engage the potential employee from the beginning of the process. Why wait for induction? In a tech savvy world people are viewing websites as the image of the company. The presentational design of a web site is critical to attracting and maintaining web surfers attention, just as the outward design of a building is critical in architecture., Cober, Brown,, Keeping, & Levy. (2004), p. 625. The candidates website experience should create a connection which is carried throughout their subsequent placement and employment. Evidence also suggests that engineers are in the main demographic of Internet users, their target market. Your Web savvy will attract higher-quality candidates because of their practical knowhow. Toppy (1999), p. 306. Advantages Cost effective, offers immediacy and has computer savvy applicants. Our target demographic. Streamlines the process.

Disadvantages: More applicants doesnt mean better quality. Users of the Internet can also be stereotyped, resulting in a less diverse applicant pool.

. . . . Loose the importance . . . recruitment process. . .

of networking and direct communication throughout the

Potentially viewed by applicants as procedurally unfair.

Target Industries & Demographics IronStrong would benefit from researching areas of the employment marketing that are on the decline. This could either be an industry sector or employment demographic. For example, The growing role of women in the work force depends on improved childcare facilities, the availability of part-time work, job security after an absence for child-bearing, maternity leave, special parental leave and partners prepared to share home duties. Stone, R.J. (2006), p. 49. Given that IronStrong places significant investment in the accommodation services it may be better utilised to build services targeting women and families. If IronStrong are able to identify income gaps and capitalise on attracting people through remuneration, We just have to look at what happened in the 2007 resources boom, when the mining sector was screaming out for skilled labour in Western Australia and other areas and [was] prepared to pay higher wages,, Dodson (2010), p. 5. IronStrong can reverse the trend and buy employee loyalty. Rural communities including remote locations and indigenous people may provide an untapped resource. Common issues such as adjusting to the remoteness of communities, mining people not contributing to local mining communities because of fly in fly out rosters, etc., would all be addressed by targeting the attraction of people who are used to this kind of lifestyle, resulting in a win-win situation. Advantages: Candidates are more loyal because they have been targeted and engaged. Candidate market is opened up to new demographics Local communities benefit with contributing citizens. Retention increases.

Disadvantages:
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. . . Not . traditional market to target with unknown expectations. a . . . . . Remuneration and benefit costs may increase.
Adaptability of organisation may make this less feasible.

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Set of procedures to follow in RSP 1. 2. Job analysis, person specification, competency profile and advertisement developed. Employ the following recruitment methods: Post on website Post on internal intranet Post with employment consultants Post with newspapers Post with management to encourage word of mouth 3. 4. Screen candidates against person specification and competency profile. Engage the following selection process: Cognitive ability test Initial interview with panel of three which must include the person whom the candidate is to report Second interview if unable to distinguish candidates 5. 6. 7. 8. 9. 10. 11. Suitable candidate selected with reserve noted. References are checked. Offer made to primary candidate. Negotiation on contract of employment. Acceptance. Discuss induction arrangements and provide plan. Meet with HR representative to explain conditions of employment, check off on all paperwork completed for employment, explanation of all workplace matters, health and safety, mission and structure of organisation, on the job performance and communication systems. 12. 13. Tour of location. Introductions including: Allocated buddy person Colleagues Available mentors

Conclusion

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IronStrong faces a challenging external environment with political debate on immigration policy, demographic challenges with an ageing population and low birth rate. Competition from more attractive regional locations, socially conscious and acceptable industries like gas booming and the economic situation returning to a pre-financial crisis platform, prospects are challenging for IronStrong. People are at the core of the problem for IronStrong, there just arent enough to fill positions, let alone specialist mining engineers. IronStrongs issues are two fold though with the expression from management of a lack of job performance and retention of the employees. IronStrong needs to examine their people strategies and ensure that they are aligned with the organisation. The adoption of best practice workplace benefits and building themselves as a branded employer of choice would certainly help the attraction. However, before IronStrong can even attempt to get to this point, a thorough assessment of their current activities would be advisable. Utilising web based technology and building the communication of who they are and what they do for employees needs to be a focus given their target market is the demographic of Internet users. Expansion of IronStrongs target employee market needs to extend further from the traditional molds of an engineer. Exploring strategies to encourage women, regional and indigenous people could have some surprising results. I found a lack of evidence to suggest that the mining industry isnt targeting these areas, but with flexible workplace being a key motivational driver for women in the current employment market and companies catering to this demand, IronStrong would be ignorant not to employ similar strategies. Indigenous communities are working hard to build relationships with industries to better their peoples lives and IronStrong has a huge opportunity to foster this development within their organisation. Internally, job analysis is crucial and investigation of the performance issues must be completed to enable an accurate assessment of needs.

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Recommendations
1. A full review of the human resource departments recruitment, selection and placement activities is to be carried out in the form of surveying past and present employees. 2. Human resource department to meet with senior management for strategic alignment discussion and strategy development. 3. Focus groups are to be run to contribute to the job analysis of the engineering role. 4. Website development of an interactive career section including applicant login and tracking which converts to employee intranet upon successful appointment to a position. 5. Community leaders to be contacted and strategies discussed and developed on the integration of mining employees to the community, indigenous employment and skill development and accommodation changes to cater for families and women. 6. Key regional areas researched for targeting potential candidates. 7. Implementation of building IronStrongs employer branding through best practice RSP processes.