LESSON THREE

HUMAN RESOURCE PLANNING AND RECRUITMENT

Lesson Objectives

By the end of the lesson you should be able to:

a) Explain the main techniques used in employment planning and forecasting.
b) Name and describe the main internal and outside sources of candidates.
c) Effectively recruit job candidates.
d) Forecast Personnel Needs in an organization.

3.0 Lesson Introduction

In the previous lesson, we discussed job analysis and the methods managers use to create job
descriptions and job specifications. The main purpose of this lesson is to help you improve your
effectiveness in recruiting job candidates. The main topics we will discuss include personnel planning
and forecasting, recruiting job candidates and developing and using job application forms.

Personnel planning is the first step in the recruiting and selecting process. We can conveniently view this
process as a series of hurdles.

Steps in Recruitment and Selection Process

The recruitment and selection process as is a series of hurdles aimed at selecting the best candidates for
the job. The steps employed are summarized below.

1. Decide what position you will have to fill by engaging in personnel planning and forecasting. 2.
Build a pool of candidates for these jobs by recruiting internal or external candidates.
3. Have applicants complete application forms and perhaps undergo an initial screening
interview.
4. Use selection techniques like tests, background investigations and physical exams to identify
viable candidates.
5. Finally, decide who to make an offer to, by having the supervisor and (perhaps) others on the
team interview the final candidates.

In the sections that follow, we discuss each of these steps in details.

3.1 Employment Planning and Forecasting

Employment or personnel planning is the process of deciding what positions the firm will have to fill and
how to fill them. Personnel planning covers all the firm’s future positions from maintenance clerk to
CEO. However, most firms use succession planning to refer to the process of deciding how to fill the
company’s most important executive jobs.

Employment planning is an integral part of a firm’s strategic and HR panning processes. A firm’s plan to
expand plans to enter new business, build new plants, or reduce costs all influence the types of positions
the firm will need to fill. One big question is whether to fill projected openings from within or from
outside the firm. In other words, should you plan to fill them with current employees or by recruiting
from outside?
Each option produces its own set of HR plans. Current employee may require training development and
coaching before they are ready to fill new jobs. Going outside requires deciding what recruiting sources
to use among other things. Like all good plans, management builds employment plans on premises –
basic assumptions about the future. Forecasting generates these premises. If you’re planning for
employment requirement you’ll usually need to forecast three things Personnel needs, the supply of
inside candidates and the supply of outside candidates.

Factors to Consider When Forecasting

1. Demand for product/service.
2. Project turnover within the organization.

3.1.1 How to Forecast Personnel Needs

The expected demand for your product or service is paramount when forecasting personnel needs. The
usual process is therefore to forecast revenues first. Then estimate the size of the staff required to
achieve this volume. In addition to expected demand staffing plans may reflect.
1. Demand for product or service.
2. Projected labor turnover (as a result of resignation or terminations)
3. Quality and skills of your employees (relations to what you see as the changing needs of your
organization) – training needs.
4. Strategic decisions to upgrade the quality of products or services or enter into new markets.
5. Technological and other changes resulting in increased productivity.
6. The financial resources available to your department.

Methods to Predict Employment Needs

1. Trend Analysis
This means studying variations in your firm’s employment levels over the last few years to predict future
needs. Thus, you might compute the number of employees in your firm at the end of the last five years
or perhaps the number in each subgroup (like sales, production, secretarial and administrative people)
at the end of each of those years. The purpose is to identify trends that might continue into the future.
Trend analysis can provide an initial estimate, but employment levels rarely depend just on the passage
of time. Other factors (like inflation changes in sales volume and productivity) also affect staffing needs.

II. Ratio Analysis

This means making forecasts based on the rations between some usual factor (like sales volume) and
the number of employees required (for instance, number of salesperson). For example, suppose a
salesperson traditionally generates Php 500,000 in sales. If the sales revenue to salespeople ratio
remains the same you would require six new salespeople next year (each of whom produces an extra
Php500, 000) to produce a hoped-for extra Php 3 million in sales Like trend analysis, ratio analysis
assumes that productivity remains about the same- for instance, that each sales person can’t be
motivated to produce much more than Php 500,000 in sales. If sales productivity were to increase or
decrease, the ratio of sales to salespeople would change. A forecast based on historical rations would
then no longer be accurate.

iii. The Scatter plot

A scatter plot shows graphically how two variables- such a measure of business activity and your firm’s
staffing levels- are related. If they are, then if you can forecast the level of business activity, you should
be able to estimate your personnel requirements.
Iv. Managerial Judgment
Whichever forecasting method you use, material judgment will play a big role. It’s rare that any
historical trend, ratio or relationship will simply continue unchanged into the future. You’ll therefore
have to modify markets - your belief will be important. In practice, making personnel forecasts usually
isn’t mechanical, even for major firms. It is sometimes difficult to take a long-term perspective,
particularly when market conditions change dramatically. One may need to modify managerial judgment
due to ;( will affect forecasting)
 Upgrade quality of products or services or services or enter into new on market. This will have
implications on quality of employees that you require.
 Are employees going to fit the new products you make
 Technological and administrative changes resulting in increased productivity which may lead
to reduced no. of employees.
 Financial resources available- pay more wages

3.1.2 Forecasting the supply of inside candidates

Knowing your staffing needs only satisfies half the staffing equation. Next, you have to estimate the
likely supply of both inside and outside candidates. Most firms start with the inside candidates. Here the
main task is determining which current employees might be qualified for the projected openings. For
this you need to know your current employees’ skills sets- their current qualifications. Sometimes it’s
obvious and managers to qualifications inventories. These are manual or computerized records listing
systematic listing of employee education, career and development interests, languages, special skills and
so on, to be used on selecting inside candidates for promotion. The following devices are of importance
when forecasting the supply of inside candidates.

Manual systems and personnel replacement charts:

Managers use several manual devices to keep track of candidates for most important positions. A
personnel inventory and development record compiles qualifications information on each employee.
Personal replacement charts are another option, particularly for the firm’s top positions. They shoe the
present performance and promotability for each position’s potential replacement. As an alternative, you
create a card for each position, showing possible replacements as well as their present performance,
promotion potential and training.

Computerized information systems:

Companies don’t generally track the qualifications of hundreds or thousands of employees manually.
Most firms computerize this information, using various packaged software systems. In many of these
systems, the employees and the HR department enter information about the employee’s backgrounds,
experience and skills often using the company intranet. When a manger needs a person for a position,
he/she describes the position (for instance, in terms of education and skills). After scanning its database
of possible candidates, the system produces a list of qualified candidates.

Such computerized skill inventory might include:

Work experience codes: A list of work experience titles or codes describing the person’s job
within the company.
Product knowledge: The employee’s level of familiarity with the employer’s product line or
services
Industry experience: The persons industry experiences, since for some positions work in related
industries is very useful.
 Formal education: Each postsecondary educational institution attended, filed of study, degree
granted and year granted
Training courses: Those taken or conducted by the employee, including courses taught by
outside firms
Foreign languages: Which languages; degree of proficiency, spoken and written.
Relocation limitations: The employee’s willingness to relocate and the locales he/ she would
prefer
Career interest: Work experience codes to indicate what the employee would like to be doing
for the employer in the future
Performance appraisals: Updated periodically, along with a summary of the employee’s
strengths and deficiencies.
Skills: Skills such as “graphic designs inter face” (number of times performed, date last
performed, time, spent), as well as skill level, perhaps ranging from level 1 (can lead or instruct others)
to level 3 (has some experience: can assist experienced workers).

In practice the, the data elements could number 100 or more. For example, one vendor of a package
reportedly used by over 2,000 companies suggests 140 elements, ranging from home address to driver’s
license number, weight, salary, sick leave used, skills and veteran status.

3.1.3 Forecasting the supply of outside candidates

If you won’t have enough inside candidates to fill the anticipated openings (or you want to go outside
for another reason), you need to focus on trying to anticipate the availability of outside candidates. This
may involve several activities. For example, you may want to consider general economic conditions and
the expected unemployment rate, usually, the lower the rate of unemployment, the more difficult it will
be recruit personnel. Information like this is easy to find. Local labor market conditions are also
important high tech.
Your plans may also require that you forecast the availability of potential job candidates in specific
occupations such as nurses, computer programmers for teachers. Some occupations are in demand that
they seem it remain in demand even when the economy slows. The jobs in high de3mand aren’t
necessarily always high tech.
To forecast for external candidates, one will be guided by;
 General economic conditions- expected prevailing rate of unemployment. The lower the rate
of unemployment, the lower the labor hence the more difficult it will be recruits personnel.
 Local market conditions
 Occupational market conditions- availability of potential job candidates in specific
occupations e.g. engines, computers experts for which u will be recruiting

3.2 Effective recruiting

Assuming the company authorizes you to fill a position, the next step is to develop an applicant pool,
using one or more of the recruitment sources described below. It is hard to over emphasize the
importance the importance of effective recruiting. The more applicants you have, the more selective you
can be in your hiring. If only two candidates apply for two openings, you may have little choice but to
hire them. But if 10 or 20 applicants appear, you can use techniques like interviews and test to screen
out all about all the best.
Effective recruiting is increasingly today, for several reasons. First the ease of recruiting tends to ebb and
flow with economic and unemployment levels. High average turnover rates for some occupations are
another problem; the increased emphasis on technology and therefore on skilled human capital also
demands more selective hiring and thus a bigger applicant pool
Finding the right inducements for attracting and hiring employees can be a problem. Aggressive
recruiting is therefo0re often the name of the game. “Poaching workers is fair game”. Some recruiters
even have their own jargon. They call luring workers away from other high- tech firms “nerd rustling’.

The Recruiting Yield Pyramid

This is historical relationship leads and invitees, and interviews, interviews and offers made, and
accepted. Some employers use a recruiting yield pyramid number of new employees.
In the figure below (figure 3.1) the company knows the ratio of offers made to actual new hires I 2 to 1;
about the people to whom it makes offers accept them. Similarly, the firm knows that the ratio of
candidates interviewed to offers is made is 3 to 2, while the ratio candidates invited for interviews to
candidates actually interviewed is about 4 to 3. Finally, the firm knows that of six leads that come in
from all its recruiting efforts, only one applicant typically gets an interview- a 6 to 1 ratio.

Given these ratios, the firm knows it must generate 1,200 leads to be able to invite 200 viable
candidates to its offices for interviews. The firm will then get to interview about 150 of those invited and
from these it will make 100 offers. Of those 1000 offers, about 50 will accept.

50 new hires

100 offers made (2:1)

150 candidates interviewed (3:2)

200 candidates invited (4:3)

1,200 leads generated (6:1)

Figure 3.1: Recruiting Yield Pyramid

Recruiting may bring to mind employment agencies and classified ads, but current employees are the
best source candidates.
Filling open positions with inside candidates has many benefits. First, there’s really no substitute for
knowing a candidate’s strengths and weakness. It is often therefore safer to promote employees form
within, since you’re likely to have a more accurate vies of the person’s skills than you would an
outsiders. Inside candidates may also be more committed to the company. Morale may rise, to the
extent that employees see promotions as rewards for loyalty and competence. Inside candidates may
also require less orientation and training than outsiders.

However, hiring from within can also backfire. Employees who apply for jobs and don’t get them may
become disconnected telling unsuccessful applicants why they were rejected and what remedial actions
they might take to be more successful in the future is thus crucial.
Similarly, many employers require managers to post job openings and interview all inside candidates.
Yet the manger often knows ahead of time exactly whom he or she wants to hires. Requiring the
persons to interviews a stream of unsuspecting inside candidates can be a waste of 1,200 leads
generated (6:1) 200 candidates invited (4:3) 150 candidates interviewed (3:2) I00 offers made (2:1) 50
new hires 41 time for all concerned. Groups are sometimes not as satisfied when their new boss is
appointed from within their own ranks as when he or she is newcomer: it may be difficult for the insider
to shake off the reputation of being “one of the gang.”
Inbreeding is another potential drawback. When all managers come up through the ranks, they may
have a tendency to maintain the status quo, when a new direction is required. Many “promote from
within”. Balancing the benefits to morale and loyalty with the possible inbreeding problem can be a
challenge.

3.3 Finding internal candidates

To be effective promotion from within requires using job position, personnel records and skills banks.
Job posting means publicizing the open job to employees (often by literally posting it on bulletin boards
or intranets) and listing the job’s attributes, like qualifications, supervisor, work schedule and pay rate.
Some union contracts require job posting to ensure union members get first choice of new and better
positions. Yet job posting can be a good practice even in non-union firms, it facilitates the transfer and
promotion of qualified inside candidates. (However, firms often don’t post supervisory jobs;
management often prefers to select supervisory candidates based on things like supervisor’s
recommendations and appraisals and testing results).
Personnel record share also important. An examination of personnel records (including application
forms) may reveal employees who are working in jobs below their educational or skill levels. It may
reveal persons who have potential for further training or who already have the right background for the
open job: Computerized records systems (like those discussed above) can help ensure you consider
qualified inside candidates for the opening. Some firms also develop “skill banks” that lists current
employees with specific skills. For example, if you need an aero scope engineer in unit A and the skill
bank show as person with those skills in unit B, that person may be approached about transferring.

3.3.1 Hiring employees- the second time around

Until recently, many managers consider it unwise to hire former employees, such as those who’d left
voluntarily for better jobs. Quitting was often seen as a form of betrayal. Managers often assumed that
those they’d dismissed might exhibit disloyalty or a bad attitude if hired back.
Today- thanks partly to high turnover in some high-tech occupations rehiring former employees is back
in style.
Rehiring back employees has its pros and cons. On the plus side, former employees are known
quantities (more or less) and are already familiar with the company’s culture, style and ways of doing
things. On the other hand, employees who left for greener pastures back into better positions may
signal your current employees that the best way to get ahead is to leave the firm.
In any event, there are several ways to reduce the chance of adverse reactions. For example, once
rehired employees have been back on the job for a certain period, credit them with the benefits such as
vacation time and thereby on morale. In addition, inquire (before rehiring them) about what they did
during the layoff and how they feel about returning to the firm; you don’t want someone coming back
who feels they’ve been mistreated,” said one manager.

3.3.2 Succession planning

Forecasting the availability of inside executive candidates is particularly important in succession
planning- “the process of ensuring a suitable supply of successors for current and future senior or key
jobs”, arising from business strategy so that careers of individuals can be planned and managed to
optimize the organizations needs and the individual’s aspirations. To fill its most important executive
positions. Succession planning often involves a complicated series of steps.
Succession planning typically includes activities like these:
i. Determining the projected need for managers and professionals by company level, function and skill
ii. Auditing current executive talent to project the likely future supply from internal sources
iii. Planning individual career paths based on objective estimates of future needs and assessments of
potential
iv. Career counseling in the context of the future needs of the firm, as well as those of the individual
v. Accelerated promotions, with development targeted against the future needs of the business
vi. Performance related training and development to prepare individuals for future roles as well as
currents responsibilities
vii. Planned strategic recruitment to fill short-term needs and to provide people to meet future needs.
viii. Actually filling the positions- via recruiters, promotion from within and so on.

3.4 Outside sources of candidates

Firms can’t get all the employees they need from their current staff, and sometimes they just don’t want
to. We will look at the sources firms use to find outside candidates next

1. Advertising
Everyone is familiar with employment ads and most of us have probably responded to one or more. To
use help wanted ads successfully, employers have to address two issues; the advertising media and the
ad’s construction
2. The media
The selection of the best medium- be it the local paper, TV or the internet- depends on the positions for
which you’re recruiting. For example the local newspaper is usually the best source for blue-collar help,
clerical employees and lower level administrative employees. On the other hand, if you are recruiting for
blue-collar workers with special skills you would probably want to advertise in the heart of the industry.
The point is to target your ads where they’ll do the most good. Most employers are also tapping the
internet. For specialized employees you can advertise in trade and professional journals.
3. Advertisements in professional publications like journals.
4. Use of professional recruitment agencies e.g. manpower, Hawkins etc
5. Referrals and walk-ins/ word of mouth
6. Computerized employee databases

Constructing the ad
Construction of the ad is important. Experienced advertisers use a four point guide called
AIDA(attention, interest, desire, action) to construct ads. You must of course, attract attention to the ad
or readers may just miss or ignore it.
Develop interest in the job. You can create interest by the nature of the job itself, with lines such as
“you’ll thrive on challenging work” you can also use other aspects of the job, such as its location to
create interest.
Create desire by spotting the job’s interest factors with words such as travel or challenge.
Keep your target audience in mind.
Finally make sure the prompts action with a at statement like “call today” or “write today for more
information”

Application forms

The filled application form provides information on education,

i. You can make judgments on substantive matters such as level of education experience
ii. Draw conclusions about the applicant’s previous progress and growth especially for management
candidates
iii. Draw tentative conclusions regarding the applicant’s stability based on previous work records.
iv. Use the data in the application to predict which candidate will succeed on the job and which will not.

Using application forms to predict job performance

Some organizations use application forms to predict which candidate will be much useful in much the
same way that might use test for screening. They do this by conducting statistical studies to find
relationship between
i) Responses on the application form
ii) Measures of success on the job

Review Questions

i) Make a collection of several classified and display ads from any local newspaper and analyze
the effectiveness of these ads using the guidelines discussed in this lesson.
ii) What are the main things you would do to recruit and retain a more diverse workforce?
iii) You are going to establish your own agribusiness, as an owner proprietor you will be acting as
a human resource consultant. Your first task is to come up with a human resource plan detailing the
human resource needs and the process of meeting those needs. Explain the process you would use up
with this plan detailing how you would go about employment planning and forecasting, and recruiting of
candidates. Show how you would make use of the recruiting yield pyramid.

Text Books for Further Reading

1. Flippo, E.B. (1984 ): Personnel Management (6 th Edition). NY, McGraw-Hill
2. Harriman, A. (1985): Women/ Men Management. NY, Praeger
3. Pell, A (1969): recruiting and selecting personnel. Ny, regents

Performance Output:

Make a social media advertisement for a job you wish to fill in your agribusiness. Analyze your
ad and explain what principles guided you to make an attractive social media advertisement?

Submit in my email: jenehlo@yahoo.com