Organisation Hiring Process - Literature review Example

Organisation hiring process: Literature Review Name: Lecturer: Course: Date: Table of Contents Table of Contents 2 Introduction 3 Employee recruitment and selection 4 a) Definition of Selection 5 b) Defining recruitment 6 d) Traditional Recruitment Process 7 e) Modern recruitment process 11 Current trends in hiring process 13 Discussion on significance of recruitment in HRM 15 Conclusion and recommendations 18 Reference List 19 Organisation hiring process: Literature Review Introduction Human capital is, according to Sinha and Thaly (2013), among the most valued organisational resource, as it potentially adds value to all other organisational resources. As Al Azzam and Jaradat (2014) show, the hiring process, as a human resource management function, is a strategic nightmare for the human resource department of any organisation since it is a critical success factor for the performance of an organisation. Attracting and retaining a talented workforce is important for any organisation’s success (Gatewood et al 2010). Current trends in the hiring process show that the job market has increasingly become competitive since the available talent pool has become more diverse (Kumar and Garg 2012). This also means that recruiters need to become more selective since recruiting the wrong candidates may have significant negative implications on organisational performance. Additionally, it may lead to high cost of training and development for the staff leading the organisation to lose focus on its key objectives, hence losing its competitive edge (Mecan 2009). While a large body of researchers have clarified that poor recruitment decisions greatly affect organisational process and limit attainment of goals, many organisations in the public sector are yet to identify and implement an effective hiring processes (Oluwayemia and Olusuji, 2012 Malik et al 2012; Kumari 2012). Indeed, this forms the rationale for this literature review. In view of that, the central thesis is that the hiring processes that are more focused on selecting prospective employees who can attain organisational objectives are more likely to benefit from improved organisational performance, cost reduction, and compliance with legal obligations. This literature review presents a selective review of published research literature since 2005. The goal is to gain an insight into the current status of research on organisational hiring process, (b) explore the advancements made in the HR knowledge and identify the areas that need improvement, and lastly (c) inspire a need for future research on organisational hiring process. To address the goals of this paper, several steps were taken to identify the research studies on organisational hiring processes during the last 10 years. First, key word searches were made using the key words ‘current trends in organisational hiring processes,’ ‘organisational recruitment practice,’ ‘recruitment’ and ‘recruitment process. Business and human resource management databases consulted included Google Scholar, PsycINFO, EBSCOhost and ProQuest. Only literature published after 2005 were selected as online recruitment process gained predominance over traditional recruitment process at around that year (Holm 2010). Employee recruitment and selection According to Gatewood et al (2010), increased global competition has made businesses to be more concerned about their performance. The reason for this is that employee performance is central to an organisation's competitive advantage. Critically therefore, selecting the right talents should be based on the need to attain an organisation's objectives -- a view supported by Oluwayemia and Olusuji (2012). a) Definition of Selection Gatewood et al (2010) adds that selection entails collection and evaluation of information about individuals with the view of extending an employment offer. This kind of employment may be a first position for a new worker or a different position for the current worker. Mankikar (2014) agrees with Gatewood et al (2010) that the basic objective of selection is to identify the right applicant with the requisite skills, knowledge, and capacity from a pool of applicants since not everyone who applies for a job can be assumed to be qualified to perform the job. Gatewood et al (2010) and Oluwayemi and Olusuji (2012) further contend that it is only when organisations have determined the manpower requirement that the recruitment and selection process should begin. For instance, Coca-Cola Corporation has been lauded for its effective hiring process. Before the company starts hiring, the human resource personnel form a panel to identify and agree on whether the hiring should be external or internal as well as specifications required to attain organisational goals, or which the team lacks. The panel also identifies desirable qualities to be used as benchmark in selecting the right candidates. This entails what Nyasha et al (2013) defines as job analysis. According to Nyasha et al (2013), job analysis aims to answer questions regarding the task to be performed and the information required to enable the tasks to be done. Gatewood (2010) perceives job analysis as the process where the details on a particular job, its duties, and requirement are identified and determined. His definition corresponds with Singh (2007) idea of job analysis as intended to determine the purposes for a job, training needs, selection processes, as well as review of performance. Nyasha et al (2013) contends that job analysis is significant during the hiring process, as it enables organisations to avoid conflict of duties, which make it difficult for organisations operating in highly competitive markets to ensure that the employees are hired, while aware of the tasks awaiting them (See Figure 4). Figure 1: Job analysis during selection process (Nyasha et al 2013). b) Defining recruitment Olusuji (2012) goes ahead to define recruitment as the process of searching for prospective candidates for a position in an organisation and motivating them (candidates) to apply for the job. Therefore, the recruitment process entails attracting qualified candidates to apply for the job in order to fill a vacant position. Sinha and Thaly (2013) suggest a more simplistic definition. In their view, recruitment is concerned with ensuring that qualified persons are available to meet an organisation’s employment needs. Mwangi et al (2014) offers a more comprehensive definition of recruitment. They define recruitment as a set of activities in HR management that are performed in order to attract adequate candidates for a position who possess the required competencies, skills, and traits. By taking these definitions into perspective, it should be understood that the objective of recruitment is to create an adequate pool of potential applicants to make sure that they are available and possess the required skills, knowledge, and competence to fill a vacant position in an organisation. A case of Coca-Cola’s recruitment process draws some perspective of this. The company often invites applicants to apply for key positions through its database. Often, the objective is to create an adequate pool of potential applicants who are available and who have the required qualities to fill its key positions whenever a need arises. d) Traditional Recruitment Process In a study by Kumar and Garg (2010) to explore the impact of recruitment on organisational performance, the researchers commented that in the traditional recruitment process, the initial phase is determining the job description and a job specification. The two defined job description as the work activities or responsibilities that make one effective in a position. They also defined job specification as outlining the qualifications an organisation requires of a candidate. Nyasha et al (2013) view job description as outlining the duties, responsibilities, and job specification that the prospective candidate should possess. Overall, Job description is vital during the hiring process, as it gives an organisation an attractive image that appeals to prospective applicants. This assumption is based on, as viewed by Ehrhart and Ziegert’s (2005), proved conception that a fitting job description and specifications may attract or put off the right talents. These findings were confirmed by Mwangi et al (2014) in their study of the factors affecting staff recruitment in private hospitals in Kenya. In their study, they established that hospitals that had updated, accurate and professional looking job descriptions were more likely to attract qualified candidates, create effective job performance standards, set more attainable goals, and meet legal obligations. Mwangi et al (2014) warned that before organisations develop job description during the hiring process, they must develop a job description. Regarding their view on the traditional recruitment process, Kumar and Garg (2010) explain that qualifications are often articulated as the minimum experience, education, in addition to other requirements required for the job. The two suggested a traditional recruitment model, where recruiters undertake four predictable steps (See the figure below). Figure 2: Typical model of recruitment process (Kumar and Garg 2010) Step 1: Kumar and Garg (2010) state that in the first step in the hiring process, a recruiter should clarify the position that needs to be filled. His suggestion is justified since in the first step, the organizations tend to act based on particular recruitment philosophies, such as continuous recruitment, without regard to the vacant position. An example is where, Shell Oil Company, a multinational Anglo-Dutch oil company, recruits many petroleum engineers and technicians persistently across the year to allow enable it to have an appropriate talent pool whenever they get project. An alternative philosophy is where Coca-Cola company carries out recruitment of marketers selectively or only in cases where an opening occurs (Oluwayemi & Olusuji 2012). This may happen when the Coca-Cola’s marketing department needs to fill up a position left by two members of the sale force who resigned or were promoted. In this case, Coca-Cola’s recruitment would focus on filling the two openings. Step 2: According to Kumar and Garg (2010), the recruiter should appraise and revise the job descriptions and specifications during the second step. Clearly, Kumar and Garg’s (2010) proposition is based on the functions of job descriptions. Indeed, taking this second step into perspective, Nyasha’s et al (2013) suggestion that job description clarifies tasks and duties needed for a job, and job specification outlines the requisite qualifications come in handy. For instance, Wal-Mart has often been blame for employment contract woes as it sometimes recruits without a job description and specification. This becomes tricky for the recruiters to screen the applications based on a certain benchmark. Ultimately, the company’s management has faces the problem of selecting the right talent. Step 3: In the third step, Kumar and Garg (2010) explain that the recruiter needs to identify the likely sources of the qualified candidates. Drawing from related research studies, such as Mwangi et al (2014) and Sinha and Thaly (2013), who made a similar assumption in their description of the hiring process, it is easy to conclude that the hiring process is in most cases associated with Kumar and Garg’s (2010) step 3. From a much broader perspective, the candidates are likely to come from outside or inside the organization. According to Gatewood et al (2010), internal recruitment or sourcing from within has the potential to maximize return on a firm’s investment on employees. Kumar and Garg (2010) support this view. In fact, they argue that when organizations seek internal candidates, the management benefits from greater awareness of persons who show interest in advancing their careers further. For instance, Coca-Cola has a tendency to source for candidates from within by bidding or through supervisory recommendations in its departments across the globe. On the other hand, the companies like Apple Inc, a US-based technology firm, have a tendency to recruit externally due to the need to keep introducing new talents and innovations from across the global market. Like Holm (2010), Kumar and Garg (2010) suggest that the methods for sourcing for candidates from outside the organization include television ads, newspapers, and the radio. Step 4: In the fourth step, Kumar and Garg (2010) explain that recruiters have to select the most efficient means of communicating and attracting the qualified candidates. During this step, the recruiter engages marketing the organization to the potential candidates, a view supported by Gatewood et al (2010), who adds that the extent to which an organization markets itself determines the extent to which it will appeal to the qualified candidates. Holm (2010) suggested several methods to which recruiters can communicate with the potential candidates, such as corporate websites, campus visits, and open houses. In a related study, Holm’s (2010) also outlined the basic requisites of the traditional hiring process. He mentions the recruitment process varies in complexity dependent on the objectives of the recruitment process and the recruitment sources selected. The most exploited recruitment sources, according to Holm (2010), include online ads, newspaper ads, employment agencies, employee referrals, corporate websites, and job fairs. Traditionally, recruitment used formal sources, such as job ads, which began with identifying the right applicants as well as their placement and location in the job market before proceeding to attract and persuade the prospective applicants. The job applications are afterwards obtained, screened, and sorted before a shortlist is drawn up. The process would then end with informing the applicants of the pre-screening results (See Figure 1 below). Figure 3: Traditional employee recruitment process (Holm 2010). e) Modern recruitment process In the modern-day recruitment process, Sinha and Thaly (2013) argue that due to the growing competitiveness in the labour market and the high globalisation, more organisations have resorted to electronic recruitment, or e-recruitment. Based on this, backdrop Holm (2010) suggested a descriptive process change (BPC) model, based on research literature contributions from current studies. His model is based on the assumption that globalisation has made modern-day business complex, hence social systems consist of mutually interconnected subsystems of change in organisations, such as technology, structure, people and task. The BPC model Holm (2010) suggests is strategy-driven as indicated in Figure 3 below. Figure 4: Holm's (2010) BPC model for modern-day recruitment process For instance, today most multinational companies like Shell Oil or Coca-Cola cannot efficiently use the traditional paper-based method of recruiting due to the large number of applications and need to comply with diversity strategies. An effective alternative is using the internet, where they invite candidates to apply through their website. For this companies, recruitment is essentially technology-based. The rationale behind the model, Holm (2010) explains, is to introduce ICT to the recruitment process, such as in the case of e-recruitment, would affect the people, management, the business structure, as well as the business process tasks. Accordingly, the model proposes three hiring processes: attracting, sorting and communicating with the candidates. In the initial step, a suitable design of webpages is enabled through the internet to advertise the job and to invite application by the potential candidates. Next, is the sorting or screening of the candidates, using sophisticated online tests. In the third step, the candidates are contacted. To this end, it could be reasoned that unlike the traditional paper-based hiring process, the technology-based allows full-time, as well as contiguous collection and processing of applications. Towards this end, the modern-day hiring process provides a two-way communication process that is ubiquitous, as well as space- and time-independent. In fact, based on Florea and Badea’s (2013) review of literature, it is easy to conclude that the use of technology in recruitment has had a significant impact on varied aspects of the organisation’s hiring process, including on organisational structure, people, and processes. During the recruitment process, Gatewood et al (2010) outlines that an organisation can generate applicants internally from its existing employees who deserve promotion or source for candidates externally in the labour market. A similar perception is promoted by Oluwayemi and Olusuji (2012) who further add that regardless of whether the candidates are sold externally or internally, the company still needs to sell itself to the more promising candidates if it desires to screen the best talents. Current trends in hiring process Due to the prevalence of the internet, current studies on the recruitment process have tended to focus on the internet-based recruitment. In a recent study by Sinha and Thaly (2013), the researchers investigated the current trends in organisational hiring process while placing their focus on Internet-based recruitment. The study established that the increased use of the social media has complicated the organisational hiring process. Madera and Chang (2011) carried out a similar research in the United States that revealed the use of Twitter and Facebook as enabling candidates to share personal information that has prompted many employers to use also the social media to screen the candidates. Sinha and Thaly (2013) explain that the reason for this shift is since most recruiters may want to verify information that candidates provide in their curriculum vitae. For instance, a study by Levashina (2009), which aimed to study what motivates employers to turn to the social media, found that most recruiters who had used the social media for purposes of screening the candidates established that the candidates tended to falsify their information on curriculum vitae, including level of education, and employment record. Hence, it could be reasoned that the additional reasons why HR practitioners turn to the social media during the hiring process is since the social networking sites have additional benefits over the traditional HR tools, including their high accessibility at minimal cost and high reliability. Sinha and Thaly (2013) further examined the link between student attitudes and the use of social media in the recruitment process. The researchers theorized that the internet would be perceived as likely to present less accurate data on applicants compared to the informal means of hiring. However, the researchers established that the findings did not support their hypothesis. A recent paper by Florea & Badea (2013), which centred on the ways in which organizations apply technology and whether it adds value to their hiring processes, established that the recruiters could use the internet to establish an effective recruitment program to get through a highly competitive recruitment process for skilled workforce. However, Madera (2012) examined the reliability of using the social media for recruiting process and established that recruiters need to be cautious while using the tools until they validate the information found on the social media. Discussion on significance of recruitment in HRM In his review of the recruitment processes used by insurance firms in Nigeria, Olusuji (2012) concluded that the recruitment and selection process should be a central function for attaining organisational goals, an idea shared by Abomeh and Blessing (2013). Olusuji (2012) illuminated the need for effective hiring processes by arguing that when a vacancy needs to be filled in an organisation, the recruiters goes ahead to make careful examination of the details of the job. At this level therefore, the recruiter has taken all aspect of the job environment into perspective. Put differently, the recruitment process needs careful planning. In the words of Malik et al (2012), the employment process has to address two primary questions; the recruiter has to know what to look for in order to recognise the suitable candidate and second, the recruiter establish the knowledge/skills/abilities (KSAs) in order determine their capacity to attain organisational goals. This conception is consistent with Gatewood’s et al (2010) argument that recruiters must methodically gather information from the applicants on their levels of KSAs each possesses (See Figure 1). For instance, to during the recruitment process, Coca-Cola invites applicants to apply through its recruitment database by inviting potential applicants to fill in a form requiring them to outline their knowledge, skills and abilities. This allows the company to s gather informationystematically on the applicants’ levels of KSAs. During the past decade, a consistent succession of research findings have indicated that effective recruitment processes are linked to positive organisational outcomes (Ehrhart & Ziegert 2005; Sule & Ugoji 2013; Mankikar 2014). An example of study that shared a similar conception was Abomeh and Blessing’s (2013) assessment of recruitment practices by businesses in the hospitality industry in Nigeria. The study established that for hotels in Nigeria to be successful, they have to recruit productive hospitality staff with the pertinent knowledge/skills/abilities (KSAs) in customer care and hospitality. Studies have found additional evidence in other industries. Malik et al (2012) examined the problems businesses face in the telecommunications sector in Pakistan and concluded that most of the problems, including poor performance, were linked to poor employee recruitment strategies. In other words, organisational productivity is linked to the workforce quality, which is in turn linked to the employee recruitment process. As Holm (2010) explains, the first decade of the 21st century witnessed a rapid growth of reliance on online recruitment in the hiring process. Following a case study of three multinational corporations in Denmark to determine the effects of internet-based recruitment, Holm (2010) identified several benefits associated with electronic recruitment: data availability and accessibility, lower advertising cost, enhanced organisational attraction, speedy information flow between the applicants and the recruiters and reduced expenses on communication. Despite the associated benefits of internet-based hiring process, Holm (2010) warns that it has associated drawbacks. For instance, Coca-Cola has a global footprint, which means that the numbers of applicants are likely to be high. The problem comes where Coca-Cola faces curriculum vitae (CV) overload, greater applicant diversity, and limited personalised response to the applicants. Drawing from these limitations it is significant that the recruiter conduct an effective hiring process. Additionally, while using the social media, it is crucial for the HR practitioner to avoid losing their focus on the key objectives of the recruitment process. Indeed, this view has been examined empirically by several recent studies. For instance, in an exploratory study of the recruitment processed used by SMC Global Securities Ltd in the United States, Kumari (2012) hypothesised that a recruitment process that focuses more on attaining organisational objectives leads to improved organisational outcomes. The researcher identified the general trends modern-day organizations use in their hiring processes, and identify how their practices affect organizational outcomes. Kumari (2012) established that an effective hiring process is beneficial to the organisation because of three key reasons: improved performance, cost reduction, and compliance with legal obligations. In respect to performance, Kumari (2012) commented that organisational performance is dependent on its workforce. Hence, selecting employees with the right skills leads to high quality output for the organisation. Sinha and Thaly (2013) supports this observation in his related review. The researchers mentioned that selecting employees with relevant skills leads to effective organisational performance. Otherwise, the organisation will suffer extensively. Hence, selecting the best and perfect applicants effectively contributes to organisational success. Regarding cost, Kumari (2012) explains that recruiting the right candidates is significant since the recruitment process is costly. As a result, cost-benefit ratio should be taken into consideration to purge unnecessary wastage of financial resources. The researcher further explained that the cost of hiring a manager could be 10 times as high when the costs of search, time or interviewing, confirming references, and travelling are added. A related study by Kumar and Garg (2012) examine the outcomes of online recruitment and found that poor recruitment decisions are costly, as they lead to long-term negative effects such as high cost of employee training and development and high turnover rates. When it comes to legal obligations, Gatewood (2010) explains that selecting the right candidate is significant due to the two legal implications of poor hiring. In his review of literature, he established that equal employment law demand non-discriminatory selection process. Additionally, an organisation may be found liable by the court of law when candidates with criminal records are hired (Kumar and Garg 2012). Hence, effective hiring process should avoid negligent hiring. Therefore, it should be pointed out that while organisations encounter adverse challenge in ensuring that the human capital contributes to an organisation’s bottom-line, acquiring the right talents is the main determining factor on how effectively an organisation contributes to attainment of the overall objectives. Conclusion and recommendations Hiring processes that are more focused on selecting prospective employees who can attain organisational objectives are more likely to benefit from improved organisational performance, cost reduction, and compliance with legal obligations. In fact, based on the findings of the literature review, it is concluded that during the past decade, a consistent succession of research findings have proved that effective recruitment processes bring positive organisational outcomes. Hence, for organisations to attain their objectives successfully, they have to conform to recruiting productive staff with the pertinent knowledge/skills/abilities (KSAs). It is further established that understanding the organisation concept of both traditional and online recruitment is achieved by studying how the external environment and the society affect the recruitment process. By basing on the findings from the review literature, it is further concluded that information technology has become increasingly important for the hiring process. Though traditional recruitment process may not call for use of technology, internet recruitment is contingent on ICT. However, perception of technology merely as contingency will restrict research to determining the economic rationality of using technology in recruitment, even as technology play a critical role in broadening the talent pool. It is therefore, recommended that more studies should be undertaken to determine how different elements of the external environment and the society add to the efficiency of the online recruitment process. Studies should also be done to determine how the internet promotes the efficiency of the recruitment process. 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