Staffing

1. Staffing 1. Human Resource Forecasting. 2. Employee Recruiting. 3. Employee Selection.

2. I. Human Resource Forecasting Topics 1. Benefits of HR Forecasting. 2. Methods of Demand Forecasting. 3. Methods of Supply Forecasting. 4. Dealing with Imbalances.

3. 1. Benefits of HR Forecasting 1. Prevent understaffing and disruption to operations. 2. Prevent overstaffing and subsequent costs of employee layoff. 3. Allow efficient and effective use of other HR functions.

4. Examples of the relationship between HRForecasting and other HR functions. • Recruiting – Allowing lead time to develop the most effective recruiting sources (i.e., methods). • Selection – Providing time to generate a larger number of applicants from which to select. • Training – Ensuring that training programs are used to their maximum but not overwhelmed. • Compensation – Ensuring that wage rates are not inflated due to pressures from “crisis” hiring.

5. Definition of Selection Ratio • “The percentage of applicants who are offered a job”. • Note: The smaller the selection ratio, the higher the hiring hit rate (the percent of those hired who turn out to be acceptable employees).

6. 2. Demand Forecasting • A. Judgmental • B.Mathematical • C. Statistical

7. A. Judgmental Forecasting • Conducting surveys of operating managers to estimate the number of employees needed to support current and future operations. • Best for short-run forecasts and small and medium sized organizations.

8. B. Mathematical Forecasting 1. Productivity Ratio Average Sales or Production ÷ Average Number Operating Employees Example: $50,000,000 in average sales over past 7 years ÷ 1000 operating employees = PR of $50,000 per employee.

9. 2. Staffing Ratio • Average Number of Operating Employees ÷ • Average Number of Support Employees • Example: 1000 Operating Employees ÷ 200 Staff Employees = 5 to 1 ratio • Therefore, if 1200 Operational Employees are needed next year, 240 StaffEmployees will be required. (1200/5)

10. C. Statistical Forecasting(Correlation-Regression Analysis)Prediction Equation: Y = a + b (X) • Number ofSales Volume per Year (x) • Employees (y) • 100 1996 - $500,000 • 110 1997 - $560,000 • 120 1998 - $600,000 • 130 1999 - $620,000 • 140 2000 - $680,000 • 150 2001 - $720,000 • 160 2002 - $740,000 • 170 2003 - $760,000

11. Regression equation graph: Y Number Employees Needed b = Slope of Prediction Line a X Annual Sales Volume

12. Demand Exceeds Supply (Shortage) Transfer and retrain. Promotion from within. Overtime. Subcontracting. Part time and temps. Recruit from outside. Supply Exceeds Demand (Excess) Reduced hours. Work sharing. Voluntary retirements. Inducement to quit. Pay freeze or cut. Layoffs. 4. Balancing Supply and Demand(See Figure 5.1) Dealing with Imbalances

13. II. Employee Recruiting Topics 1. Purposes of recruiting. 2. Filling vacancies from inside vs. outside. 3. Realistic job preview (RJP). 4. Pros and cons of recruiting methods.

14. 1. Purposes of Recruiting 1. Purposes of Recruiting • 1. Attract a sufficient number of applicants to allow an optimal selection ratio. (The "selection ratio" is the percentage of applicants hired out of the total number of applicants. 2. Aid in meeting EEO and diversity goals. 3. Maintain goodwill and positive image of the company.

15. Pros Familiarity may increase selection accuracy. Employee motivation to perform well and develop skills. Quicker and lower staffing costs. Lower training and adjustment costs. Cons Current employees may not be prepared. May lead to a “ripple effect”, as one vacancy filled from within causes another vacancy, which increases staffing costs. May lower the influx of new ideas and innovation. 2. Filling Vacancies from Within 2. Filling Vacancies from Within

16. Pros Larger number of applicants lowers selection ratio and raises hit rate. (The “hit rate” is the percentage of people hired who turn out to be good employees). Prevent ripple effect. May increase innovation. Aid in meeting diversity goals. Cons Increases staffing costs. Increases training and adjustment costs. Takes longer to fill vacancies. May lower employee motivation to perform well and develop skills. Filling Vacancies from Outside. Filling Vacancies from Outside

17. 3. Realistic Job Preview (RJP) 3. Realistic Job Preview (RJP) • RJP: Providing realistic and complete information to job applicants about the job and organization in order to increase post-hire job satisfaction and adjustment. • Recruiting studies show that the more complete and realistic the information provided to applicants, the more likely those hired will be satisfied, acclimated, and feel less stress, leading to better performance, reduced absences, and lower job turnover.

18. Types of RJP information: • Information about job duties and tasks. • Qualifications required (knowledge, skills, and abilities). • Work schedules and other demands. • Promotion opportunities and organizational rewards (bonuses). • Employee benefits. • Organizational goals and culture.

19. Types of RJP methods: • Interviews • Tours • Brochures • Videos • Discussions/Q&A

20. Reasons RJP Is Beneficial Reasons RJP is Beneficial • Employees make better self-selection (i.e., “fit”) decisions because they have complete and relevant information. • Employees are more committedto their decision because they accepted the job based on relevant facts. • Employees have more realistic expectations about the job and organizational culture, which increases post-hire satisfaction. • Employees have better coping ability because they have been informed of both positive and negative aspects of the job and organization.

21. 1. Referrals Employee Referrals Outside Referrals Former Employees 2. Direct Contact Direct Application Professional Conferences Vocational-Trade Schools College Recruiting Internet 3. Agency USES (Public) Commercial Agencies Executive Search 4. Media Newspapers Special Publications 4. Recruiting Methods 4. Recruiting Methods

22. Validity & Reliability • Validity: • Validity refers to the truthfulness of findings. • The ability of the selection device to predict who will be a good job performer • Reliability: - Reliability means that the findings would be consistently the same if the method/study is done again. - The consistency with which a selection method assesses the intended knowledge, skills, or abilities.

23. 1. Referrals • Employee Referrals – Quick source of applicants when there are a small number of vacancies; excellent RJP and screening; all types of employees; low expense; may not help with diversity goals. • Outside Referrals & Former Employees – Similar to Employee Referrals; may not have as good RJP and screening; low expense.

24. 2. Direct Contact • Direct Application – Quick source of employees when company maintains applicant files particularly for small number of vacancies; all types of employees; research shows high quality; low expense. • Vocational-Tech Schools – Good source of specialized, skilled employees; good screening when aptitude scores and training performance is available; research shows high quality; low expense.

25. 2. Direct Contact • Internet – Covers wide range of jobs; readily available websites for commercial and government jobs; quick response; potential for good RJP and screening; moderate-to-high cost; “point of contact” recruiting on customer websites. • College Recruiting – Good for large number of applicants with appropriate education; best for entry level jobs; often low RJP, screening, and quality; very high expense.

26. 3. Agency • United States Employment Service(USES) – Covers wide range of jobs; located in all states (run by states); good screening - conscientious (not for profit) and use of testing; moderate volume and low expense. • Commercial Agencies – All types of jobs; often low RJP and screening; focus is on placement for a fee; trial and error in finding a solid agency; high expense.

27. 3. Agency • Executive Search Firm – Specialized source of higher level managerial and professional employees; may risk loosing own employees as many search firms perceive all employees as ‘fair game’; often low RJP and screening; very high expense.

28. 4. Media • Newspaper Ads – High volume; relatively fast; often low RJP; requires follow-up screening; can have high screening expense for large volume of applicants; research indicates low quality. • Special Publications – Moderate volume; relatively fast; may indicate strong interest and commitment to career field of applicants; moderate expense.

29. EmployeeSelection

30. Selection Methods 1. Experience Measures. 2. Tests. 3. Interview.

31. 1.ExperienceMeasures 1. Traditional Application 2. Weighted Application 3. Experience or Accomplishment Questionnaire 4. Biographical Data 5. References and Background Checks

32. A. Traditional Application Used to obtain information about education, training, and past job experience to determine if the candidate meets minimum qualifications. Studies indicate that a “holistic’ approach to assessing application information lacks reliability (.75-.85) and validity (.20-.30). For this reason, more structured and precise methods for assessing past experiences is recommended.

33. B. Weighted Application Blank A quantitative application that has acceptable reliability (.85-.90) and validity (.30-.40). Step 1:Employees in a particular job area are grouped into “high” and ‘low” performance. Step 2: Characteristics about the employees are obtained from personnel records and panels of experts (e.g., supervisors) and studied in terms of their ability to differentiate between high and low performers. Step 3: Questions are formulated using only the predictive characteristics and placed in the final weighted application.

34. C. Experience or AccomplishmentQuestionnaire- A structured approach to assessing past job experience that has acceptable reliability (.85-.90) and validity (.30-.40). Used mainly for “exempt” jobs. Step 1: A panel of job experts identify types of past experience that are desirable for a particular job. Step 2: Scoring scales are developed for assessing past experiences reported by applicants. The two kinds of scoring scales are BARS (Behaviorally Anchored Rating Scale) and BOS (Behavioral Observation Scale). Step 3: Applicants record and describe their past experiences in different areas (BARS) or mark a series of rating scales (BOS).

35. D. Biographical Data Similar to personality tests, but assesses self-reported experiences related to different situations. Referred to by psychologists as “personality in situ”. Examples of characteristics assessed with Biodata: • Social interaction. • Risk taking or avoidance. • Assertiveness. • Affinity for structured or unstructured tasks. Has acceptable reliability (.85-.90) and the highest validity (.40-.50) of any experience measure.

36. E.References and Background Searches Reference information from past employers has relatively low Reliability (.70-.80) and Validity (.20-.30) for the following reasons: • Different references give different assessments of a candidate. • Information is largely holistic in nature. • Passage of time decreases memory. • Reference sources are hesitant to give detailed information for fear of law suits.

37. Types of reference information sought: • Educational history. • Employment history. • Character references. • Military service. • Immigration status. • Problematic conduct (e.g., drug use, theft, etc.)

38. Types of background information sought: • Proof of identity. • Driving record. • Criminal history (arrests and convictions). • Indebtedness. • Credit worthiness. • IRS problems. • Reputation and lifestyle information from neighbors and acquaintances.

39. Recommendations for Past Employers 1. Give only job related information that can be supported. 2. Do not volunteer information. 3. Avoid generalized statements. 4. Do not answer “trap” questions such as “Would you hire this person again?” 5. Avoid references to a past employee’s EEO status.

40. Tests 1. Ability/Aptitude Tests. 2. Knowledge-Skill Tests. 3. Personality Inventories. 4. Honesty-Integrity Tests. 5. Drug tests. 5. Polygraph Tests.

41. Ability and Aptitude Tests • Ability tests measure General Intelligence and major sub-traits such as Verbal Reasoning, Reading Comprehension, and Mathematical Reasoning. • Aptitude tests measure specific mental and physical abilities such as: • Spatial relations • Perceptual speed • Memory • Mechanical comprehension • Dexterity • Static strength • Dynamic strength • Stamina

42. Ability and Aptitude Tests • High reliability (.90-.96) and validity (.40-.60). • Useful for all jobs, but due to potential adverse impact on EEO sub-groups, other more directly job related tests are often used such as: 1. Knowledge and skill tests. 2. Reading comprehension tests. 3. Trainability tests. (These tests correlate highly with mental ability tests.) • Normally, applicants for higher level jobs are not tested unless through an Assessment Center.

43. Knowledge-Skill Tests Developed to directly assess specific job knowledge and skill. Testing methods • Pencil-paper tests. • Performance tests – also called work samples or simulations. Example: Word processing and filing test for secretaries. • Trainability tests.

44. Knowledge-Skill Tests • Acceptable reliability (.85-.90) and high validity (.40-.60). • Particular advantages: 1. Correlate with ability tests. 2. Low adverse impact on EEO sub-groups. 3. Accepted by applicants due to “face validity”. 4. Can be developed by HR staff with aid of line managers.

45. Knowledge-Skill Tests • Acceptable reliability (.85-.90) and high validity (.40-.60). • Particular advantages: 1. Correlate with ability tests. 2. Low adverse impact on EEO sub-groups. 3. Acceptance due to “face validity”. 4. Can be developed by HR staff with aid of line managers. 5. Provide RJP due to job-specific questions.

46. Drug Testing A. Employer Usage Approximately 78% of employers use drug and alcohol testing for at least some jobs and employees – down from 92% in 1991. (Less than 50% of companies with 500 or fewer employees.) B. Incidence of Illegal Substance Use American Management Association survey in 1993 indicated 2.5% of employees and 4.5% of applicants tested positive for illegal substance use.

47. (cont.) C. Reasons for Drug Testing 1. Improve productivity, quality, and service. (Estimated annual loss due to drug/alcohol use is $30 Billion.) 2. Reduce absenteeism. 3. Reduce rule violations. 4. Reduce accidents. 5. Reduce turnover due to firings.

48. Interview Three main uses of the employment interview: 1. Assess minimum qualifications related to education, training, and job experience. 2. Give RJP (Realistic Job Preview) and answer applicant questions. 3. Use information to assess suitability for hiring.

49. Types of Interview Errors 1. Similarity Effect Interviewer gives more favorable assessment to those who share beliefs and personality. 2. Contrast Effect Applicants are assessed on the basis of comparisons with other interviewees rather than a set of absolute criteria. 3. First Impression Initial impression influences subsequent information and interaction. 4. Halo Error A few characteristics of the interviewee overly influence other characteristics and the overall assessment.

50. 5. Negative Weighting Interviewers tend to weight negative information higher than positive. 6. Race/Sex/Age Bias Demographic characteristics influence applicant assessments . 7. Nonverbal Communication style, animation, body language, clothing, and other visual characteristics influence interviewer ratings. 8. Listening/Memory Interviewers may not be able to recall up to 70% of the interview, particularly in the absence of a format and recording procedure.