Question no 1 – recruitment ONLY – INTERNAL and external –

Critical analysis, benefits and drawbacks

1. RECRUITMENT:
Generation of widest possible pool of qualified candidates for a vacancy.
Using both internal and external recruitment channels.
No skimping – no economising, no cutting back; otherwise, poor and short-lived recruitment
A secondary hire is more expensive than a primary hire. Secondary hire- re hiring after losing
a candidate.

Internal recruitment channels:

a. Current employees

Benefits-
- already know the company and markets,
- lot less costly than external
- employee knows the company, vice versa; track record- reciprocated
- sends a positive signal for the rest of the work force that they can be promoted, not just a
dead-end job
- less time needed to train
Drawbacks-

- moving an employee from one position to another, he needs to be replaced

- can be source of conflict

b. Referrals from current employees – BEST Source

Benefits: (same as above)

- Employee know the fit between the person and the role & company
- We trust the employee
- costs are lesser
Drawbacks:
-no drawbacks

c. Former employees- not fired employees

Benefits:
-we knew them
-they knew the business
Drawbacks:
-difficult to find them
d. Company websites
The way they are designed is key.
Benefits:
-best tool to attract candidates
-within the intranet
 Drawbacks:

e. Corporate recruitment videos

Gives a good feel of the company
Benefits:

Drawbacks:

External recruitment channels

a. Print advertisement –
expensive, snapshot of vacancy that will be around only for a day- out of date by
midnight, controlled circulation figures – buyers of newspapers have plummeted. Trade
press publications might work- monthly

b. Internet advertising and career sites-

-Super search recruitment engines – Monster.com
-Search engines – Swiss.up (local)
-Trade sector engines – Michael page
-Corporate websites – Cargil (careers)
Cost factors – more money involved, reach is wider, scope is wider

c. Employment agencies
Lot more passive and reactive than head hunters
Compile a bank of your CVs and match that with the vacancies that the clients have
available; trying to find a match
They’re usually free, rewarded after contract is signed between company and candidate

d. Head-hunters – WORST / last resort

Used as last resort, most expensive channel
They are proactive but charge 25-35% of first year salary of candidate- a problem if
searching for high paying exec roles
Very dynamic, very effective, very fast : they create snowballing effect

e. College recruiting
Important; internships or graduate recruitment programs-upto 5 years
Rotate graduates in diff positions

f. Customers/suppliers
Can sometimes know market better, might know people who could be suitable for the
company

2. SELECTION:
Set of techniques used to choose the right candidate based on the criteria
Techniques:
a. Reliability – comprehensive and correct; consistency of measurement (across times,
across judges)
 Challenges:
- Deficiency error- excludes (set of) key elements
- Contamination error-
b. Validity
Extent to which technique measures the intended knowledge, skill or ability.
Challenges
- Content validity- relates to job role
- Empirical validity- refers to relationship between selection method and actual job
performance

Tools

- CV
- Motivational letter/video
- Psychometric testing
- Interviews- structured
- Assessment centres
- Reference checks
- Background checks

Psychometric testing:

-objective assessment and specific for candidates

- personality traits

Interviews:

Normally structured

Be prepared, be confident, present well

Assessment centres-

Question no 2:
TRAINING AND DEVELOPMENT:

1. Distinguish between the two

2. Challenges facing both

1. Training
- Short term
 - Specific and narrow
- Acquisition of necessary skills for a job function
- Improvement of job performance
- Correction of deficiencies in performance

Challenges?

- What’s the aim and how we get there, outcome will indicate if its broad or specific to
department/team?
-
2. Challenges for development:
- Side effects- demoralized, demotivation of team
- Person changing too many companies

Challenges of remunerations systems:

(Difficult to break/take away incentive once given)

Question no 3 – renumeration (pay)

2 components of micro and macro incentives
Micro Incentives:
1. INDIVIDUAL –
DIRECT -
A. Merit pay: Gross monthly wage/salary before tax.
B. Bonus (Annual) – Discretionary – management decides how much bonus
employees get: based on the gross operating profit, not personal contribution
C. Commission: based on % of sales, or revenues or production output
D. Production/sales quota: Based on achieving a specified target.
= Lump sum payment
INDIRECT (Fringe Benefits) –
A. Health/Life Insurance- Based on the seniority within the company
B. Company Car + fuel
C. Employer Pension contributions (Additional)
D. Perks- use of corporate fixed assets by employees:
a. Gym
b. Nursery
c. Company jet
d. Chauffer driven limo
e. Staff canteen
f. Company apartment
2. TEAM (Objective)
Bonuses and Awards
Based on achievement of pre-set outcomes and paid equally amongst team
members.
Disadvantage-
- Members who don’t contribute also get the benefits-free riding
- Social pressures within group that can restrict performance
- Inter group competition can have negative consequences

MACRO INCENTIVES
1. Business Unit/Plant

A. Gainsharing (Plant/office based)

Cost savings are shared equally amongst all employees in annual lump sum:
a. Scanlon plan – based on employee achieving cost saving: direct material and
labour only, direct workforce(manufacture)
b. Rucker plan: direct, indirect labour and material cost savings
c. Improshare- improvement of production output through increased input
 - Enhances quality, cooperation between company and employees
Disadvantages:
- Free riding
- Based on revenues not sales- so doesn’t contribute to profit

2. Organization- Corporate wide incentives

- Linked to age and length of services, status in the company

A. Profit-sharing schemes (Most common)

Amongst the employees

B. Stock plans- Share option schemes

Allocate shares to select employees monthly
Advantage:
- tax benefits for employer /employee till redemption
Drawback:
- vulnerable to volatility
- solvency
- not linked to performance

Answers:

- phrased with sub titles

- bullet points
- critical analysis