Module 2: Chapter 1: Human Resource Planning: Objectives, Importance and process of Human Resource

planning, Effective HRP Recruitment: Definition, Constraints and Challenges,

2.1. Human Resource Planning: Human resource planning is important for helping both
organizations and employees to prepare for the future. The basic goal of human resource planning
is to predict the future and based on these predictions, implement programme to avoid anticipated
problems. Very briefly humans resource planning is the process of examining an organizations or
individual’s future human resource needs for instance, what types of skills will be needed for jobs
of the future compared to future human resource capabilities (such as the types of skilled
employees you already have) and developing human resource policies and practices to address
potential problems for example, implementing training programmes to avoid skill deficiencies.
2.2. Definition of Human Resource Planning:
According to Vetter, “HRP is the process by which management determines how the organization
should move from its current man power position to desired manpower position. Through planning,
management strives to have the right time, doing things which result in both the organization and
individual receiving maximum long run benefits”.
According to Gordon Mc Beath, “HRP is concerned with two things: Planning of manpower
requirements and Planning of Manpower supplies”.
According to Beach, “HRP is a process of determining and assuming that the organization will
have an adequate number of qualified persons, available at proper times, performing jobs which meet
the needs of the enterprise and which provides satisfaction for the individuals involved”
Simply HRP can be understood as the process of forecasting an organization’s future demands for
and supply of the right type of people in the right number. In other words, HRP is the process of
determining manpower needs and formulating plans to meet these needs.
HRP is a Four-Phased Process.
 The first phase involves the gathering and analysis of data through manpower inventories
and forecasts,
 The second phase consists of establishing manpower objectives and policies and gaining
top management approval of these.
 The third phase involves designing and implementing plans and promotions to enable
the organization to achieve its manpower objectives.
 The fourth phase is concerned with control and evaluation of manpower plans to facilitate
progress in order to benefit both the organization and the individual. The long run view
means that gains may be sacrificed in the short run for the future grounds. The planning
process enables the organization to identifywhat its manpower needs is and what potential
manpower problems required current action. This leads to more effective and efficient
performance.
2.3 Objectives of Human Resource Planning
1. To ensure optimum utilization of human resources currently available in the organization.
2. To assess or forecast the future skill requirement of the organization.
3. To provide control measures to ensure that necessary resources are available as and when required.
4. A series of specified reasons are there that attaches importance to manpower planning
and forecasting exercises. They are elaborated below:
 To link manpower planning with the organizational planning
  To determine recruitment levels.
 To anticipate redundancies.
 To determine optimum training levels.
 To provide a basis for management development programs.
 To cost the manpower.
 To assist productivity bargaining.
 To assess future accommodation requirement.
 To study the cost of overheads and value of service functions.
 To decide whether certain activity needs to be subcontracted, etc.

HRP exists as a part of planning process of business. This is the activity that aims to coordinate
the requirements for the availability of the different types of employers. The major activities are
theforecasting, (future requirements), inventorying (present strength), anticipating (comparison of
present and future requirements) and planning (necessary program to meet the requirements).

The HR forecasts are responsible for estimating the number of people and the jobs needed byan
organization to achieve its objectives and realize its plans in the most efficient and effective manner.
HR needs are computed by subtracting HR supplies or number of the employees available from expected HR
demands or number of people required to produce a desired level of outcome. The objective of HR is to
provide right personnel for the right work and optimum utilization of the existing human resources
The objectives of human resource planning may be summarized as below:
 Forecasting Human Resources Requirements: HRP is essential to determine the future
needs of HR in an organization. In the absence of this plan it is very difficult to provide the
right kind of people at the right time.
 Effective Management of Change: Proper planning is required to cope with changes in
the different aspects which affect the organization. These changes need continuation of
allocation/ reallocation and effective utilization of HR in organization.

 Realizing the Organizational Goals: In order to meet the expansion and other
organizational activities the organizational HR planning is essential.
 Promoting Employees: HRP gives the feedback in the form of employee data which can
be used in decision-making in promotional opportunities to be made available for the
organization.
 Effective Utilization of HR: The data base will provide the useful information in
identifying surplus and deficiency in human resources. The objective of HRP is to maintain
and improve the organizational capacity to reach its goals bydeveloping appropriate strategies
that will result inthe maximum contribution of HR.
2.4 Importance and process of Human Resource planning
HRP is the subsystem in the total organizational planning. Organizational planning includes
managerial activities that set the company’s objective for the future and determines the appropriate
means for achieving those objectives. The importance of HRP is elaborated on the basis of the key
roles that it is playing in the organization.
1. Future Personnel Needs: Human resource planning is significant because it helps to
determine the future personnel needs of the organization. If an organization is facing the
problem of either surplus or deficiency in staff strength, then it is the result of the absence of
effecting HR planning. All public sector enterprises find themselves overstaffed now as they
never had any planning for personnel requirement and went of recruitment spree till late
1980’s. The problem of excess staff has become such a prominent problemthat manyprivate
sector units are resorting to VRS ‘voluntary retirement scheme’. The excess of labor problem
would have been there if the organization had good HRP system. Effective HRP system
willalso enable the organization to have good succession planning.
2. Part of Strategic Planning: HRP has become an integral part of strategic planning of
strategic planning. HRP provides inputs in strategy formulation process in terms of deciding
whether the organization has got the right kind of human resources to carry out the given
strategy. HRP is also necessary during the implementation stage in the form of deciding to
make resource allocation decisions related to organization structure, process and human
resources. In some organizations HRP play as significant role as strategic planning and HR
issues are perceived as inherent in business management.
3. Creating Highly Talented Personnel: Even though India has a great pool of educated
unemployed, it is the discretion of HR manager that will enable the company to recruit the
right person with right skills to the organization. Even the existing staff hope the job so
frequently that organization face frequent shortage of manpower. Manpower planning in
the form of skill development is required to help the organization in dealing with this
problem of skilled manpower shortage
4. International Strategies: An international expansion strategy of an organization is facilitated
to a great extent by HR planning. The HR department’s ability to fill key jobs with foreign
nationals and reassignment of employees from within or across national borders is a major
challenge that is being faced by international business. With the growing trend towards
global operation, the need for HRP will as well will be the need to integrate HRP more
closely with the organizations strategic plans. Without effective HRP and subsequent
attention to employee recruitment, selection, placement, development, and career
planning, the growing competition for foreign executives may lead to expensive and
strategically descriptive turnover among key decision makers.

5. Foundation for Personnel Functions: HRP provides essential information for designing and
implementing personnel functions, such as recruitment, selection, training and
development, personnel movement like transfers, promotions and layoffs.

6. Increasing Investments in Human Resources: Organizations are making increasing

investments in human resource development compelling the increased need for HRP.
Organizations are realizingthat human assets can increase in value more than the physical assets. An
employee who gradually develops his/ her skills and abilities become a valuable asset for the
organization. Organizations can make investments in its personnel either through direct training or
job assignment and the rupee value of such a trained, flexible, motivated productive workforce is
difficult to determine. Top officials have started acknowledging that quality of work force is
responsible for both short term and long term performance of the organization

7. Resistance to Change: Employees are always reluctant whenever they hear about change
 and even about job rotation. Organizations cannot shift one employee from one
department to another without any specific planning. Even for carrying out job rotation
(shifting one employee from one department to another) there is a need to plan well
ahead and match the skills required and existing skills of the employees.
8. Uniting the Viewpoint of Line and Staff Managers: HRP helps to unite the viewpoints of
line and staff managers. Though HRP is initiated and executed by the corporate staff, it
requires the input and cooperation of all managers within an organization. Each
department manager knows about the issues faced by his department more than anyone
else. So communication between HR staff and line managers is essential for the success
of HR Planning and development.
9. Succession Planning: Human Resource Planning prepares people for future challenges.
The ‘stars’ are picked up, trained, assessed and assisted continuously so that when the
time comes such trained employees can quickly take the responsibilities and position of
their boss or seniors as and when situation arrives.
10. Other Benefits: (a) HRP helps in judging the effectiveness of manpower policies and
programmes of management. (b) It develops awareness on effective utilization of human
resources for the overall development of organization. (c) It facilitates selection and
training of employees with adequate knowledge, experience and aptitudes so as to carry
on and achieve the organizational objectives (d) HRP encourages the company to review
and modify its human resource policies and practices and to examine the way of utilizing
the human resources for better utilization
2.5 Need for HRP in Organizations
Major reasons for the emphasis on HRP at the Macro level:

1) Employment-Unemployment Situation: Though in general the number of educated

unemployment is on the rise, there is acute shortage for a variety of skills. This emphasizes
on the need for more effective recruitment and employee retention.
2) Technological Change: The changes in production technologies, marketing methods and
management techniques have been extensive and rapid. Their effect has been profound on
the job contents and job contexts. These changes have caused problems relating to
redundancies, retention and redeployment. All these suggest the need to plan manpower needs
intensively and systematically.

3) Demographic Change: The changing profile of the work force in terms of age, sex,
literacy, technical inputs and social background has implications for HRP.
4) Skill Shortage: Unemployment does not mean that the labour market is a buyer’s
market. Organizations generally become more complex and require a wide range of
specialist skills that are rare and scare. A problem arises in an organization when
employees with such specialized skills leave.

5) Governmental Influences: Government control and changes in legislation with regard

to affirmative action for disadvantages groups, working conditions and hours of work,
restrictions on women and child employment, causal and contract labour, etc. have stimulated
the organizations to be become involved in systematic HRP.
6) Legislative Control: The policies of “hire and fire” have gone. Now the legislation makes
it difficult to reduce the size of an organization quickly and cheaply. It is easy to increase but
difficult to shed the fat in terms of the numbers employed because of recent changes in
labour law relating to lay-offs and closures. Those responsible for managing manpower must
look far ahead and thus attempt to foresee manpower problems.

7) Impact of the Pressure Group: Pressure groups such as unions, politicians and persons
displaced from land by location of giant enterprises have been raising contradictory pressure
on enterprise management suchas internal recruitment and promotion, preference to employees’
children, displace person, sons of soil etc.
8) Systems Approach: The spread of system thinking and advent of the macro computer as
the part of the on-going revolution in information technology which emphasis planning and
newer ways of handling voluminous personnel records

9) Lead Time: The log lead time is necessary in the selection process and training and
deployment of the employee to handle new knowledge and skills successfully.

2.6 HRP Process: HRP effectively involves forecasting personnel needs, assessing personnel supply and
matching demand– supply factors through personnel related programmes. The HR planning process is
influenced by overal organizational objectives and environment of business
Environmental Scanning:
It refers to the systematic monitoring of the external forces influencing the organization. The
following forces are essential for pertinent HRP.
 Economic factors, including general and regional conditions.
 Technological changes
 Demographic changes including age, composition and literacy,
 Political and legislative issues, including laws and administrative rulings
 Social concerns, including child care, educational facilities and priorities.
By scanning the environment for changes that will affect an organization, managers can anticipate
their impact and make adjustments early.
Organizational Objectives and Policies: HR plan is usually derived from the organizational
objectives. Specific requirements in terms of number and characteristics of employees should be
derived from organizational objectives
Once the organizational objectives are specified, communicated and understood by all concerned, the
HR department must specify its objective with regard to HR utilization in the organization.
HR Demand Forecast: Demand forecasting is the process of estimating the future quantity and quality of people
required to meet the future needs of the organization. Annual budget and long-term corporate plan when translated
into activity into activity form the basis for HR forecast
HR Supply Forecast:
Supply forecast determines whether the HR department will be able to procure the required
number of workers. Supply forecast measures the number of people likely to be available from
within and outside an organization, after making allowance for absenteeism, internal movements and
promotions, wastage and changes in hours, and other conditions of work.
HR Programming:
Once an organization’s personnel demand and supply are forecasted the demand and supply need
to be balanced in order that the vacancies can be filled by the right employees at the right time.
HR Plan Implementation:
HR implementation requires converting an HR plan into action. Aseries of action are initiated as
apart of HR plan implementation. Programmes such as recruitment, selection and placement,
training and development, retraining and redeployment, retention plan, succession plan etc when
clubbed together form the implementation part of the HR plan.
Control and Evaluation:
Control and evaluation represent the final phase of the HRP process. All HR plan include budgets, targets and
standards. The achievement of the organization will be evaluated and monitored against the plan. During this final
phase organization will be evaluating on the number of people employed against the established (both those who
are in the post and those who are in pipe line) and on the number recruited against the recruitment targets.
Evaluation is also done with respect to employment cost against the budget and wastage accrued so that
corrective action can be taken in future.

Requisites for Successful HRP:

1. HRP must be recognized as an integral part of corporate planning
2. Support of top management is essential
3. There should be some centralization with respect to HRP responsibilities in order to
have co-ordination between different levels of management.
 4. Organization records must be complete, up to date and readily available.
5. Techniques used for HR planning should be those best suited to the data available
and degree of accuracy required.
6. Data collection, analysis, techniques of planning and the plan themselves need to be
constantly revised and improved in the light of experience.
Factors Affecting HRP:

Organizational Growth
cycle and Planning

Type and Strategy of Environmental

Organization. Uncertainties

HRP
Time horizons Outsourcing

Type and quality

of forecasting
information N ature of jobs being
filled

Type and Strategy of the Organization: Type of the organization determines the production processes
involve, number and type of staff needed and the supervisory and managerial personnel required. HR need
is also defined by the strategic plan of organization. If the organization has a plan for organic growth, then
organization need to hire additional employees. On the other hand, If the organization is going for mergers
and acquisition, then organization need to plan for layoffs, as mergers can create, duplicate or overlap
positions that can be handled more efficiently with fewer employees
Organization first decides whether to be reactive or proactive in HRP. Organizations either
carefully anticipate the needs and systematically plan to fill the need in advance (proactive) or can
simply react to the needs as they arise (reactive). Likewise, the organization must determine the width
of the HR plan. Organization can choose a narrow focus by planning in only one or two HR areas like
recruitment and selection or can have a broad perspective by planning in all areas including training and
remuneration.
The nature of HR plan also decides upon the formality of the plan. It can decide to have an
informal plan that lies mostly in the minds of the managers and personnel staff or can have a formal
plan which is properly documented in writing

The nature of HR plan is also depended upon the flexibility that is practiced in the organization.
HR plan should have the ability to anticipate and deal with contingencies. Organizations frame HRP in
such a way that it can contain many contingencies, which reflect different scenarios thereby assuring
that the plan is flexible and adaptable
Organizational Growth Cycles and Planning: All organizations pass through different stages of
growth from the day of its inception. The stage of growth in which an organization is determines the
nature and extends of HRP. Small organizations in the earlier stages of growth may not have well defined
personnel planning. But as the organization enters the growth stage, they feel the need to plan its human
resource. At this stage organization gives emphasis upon employee development. But as the
organization reaches the mature stage it experiences less flexibility and variability resulting in low growth
rate. HR planning becomes more formalized and less flexible and less innovative and problem like
retirement and possible retrenchment dominate planning.

Environmental Uncertainties: Political, social and economic changes affect all organizations and the
fluctuations that are happening in these environments affect organizations drastically.
Time Horizons: HR plans can be short term or long term. Short term plans span from six months to
one year, while long term plans spread over three to twenty years. The extent of time period depends
upon the degree of uncertainty that is prevailing in an organization’s environment. Greater the
uncertainty, shorter the plan time horizon and vice versa.

Chapter 2: Recruitment, Sources and Methods of Recruitment, New Approaches to recruitment. Selection:
Definition and Process of Selection
Introduction: Successful human resource planning should identify our human resource needs. Once we
know these needs, we want to do something about meeting them. The next step in the acquisition function,
therefore, is recruitment. This activity makes it possible for us to acquire the number and types of people
necessary to ensure the continued operation of the organization.
Hallett says, “It is with people that quality performance really begins and ends.” Robert Heller also says, “If
people of poor caliber are hired, nothing much else can be accomplished and Gresham’s law will work: the bad
people will drive out the good or cause them to deteriorate.”
Recruiting is the discovering of potential candidates for actual or anticipated organizational vacancies. Or, from
another perspective, it is a linking activity-bringing together those with jobs to fill and those seeking jobs.
Meaning of Recruitment: Recruitment forms a step in the process which continues with selection and ceases
with the placement of the candidate. It is the next step in the procurement function, the first being the
manpower planning. Recruiting makes it possible to acquire the number and types of people necessary to
ensure the continued operation of the organization. Recruiting is the discovering of potential applicants for
actual or anticipated organizational vacancies.
According to Edwin B. Flippo, “Recruitment is the process of searching for prospective employees and
stimulating them to apply for jobs in the organization.”
According to Lord, “Recruitment is a form of competition. Just as corporations compete to develop,
manufacture, and market the best product or service, so they must also compete to identify, attract and hire
the most qualified people. Recruitment is a business, and it is a big business.”
In the words of Dale Yoder, “Recruiting is a process to discover the sources of manpower to meet the
requirements of the staffing schedule and to employ effective measures for attracting that manpower in
adequate numbers to facilitate effective selection of an efficient working force.”

Human Resource
Planning

Job Analysis

Recruitment
 Figure shows recruitment to Human Resource Acquisition Process
According to Werther and Davis, “Recruitment is the process of finding and attracting capable applicants
for employment. The process begins when new recruits are sought and ends when their applications are
submitted. The result is a pool of applicants form which new employees are selected.”
Dales S. Beach writes, “Recruitment is the development and maintenance of adequate manpower
resources. It involves the creation of a pool of available labor upon whom the organization can depend when
it needs additional employees.”
Thus, recruitment process is concerned with the identification of possible sources of human resource
supply and tapping those sources. In the total process of acquiring and placing human resources in the
organization, recruitment falls in between different sub-processes as shown in Figure 4.2.
According to Scott, Clothier and Spiegel: the need for recruitment arises out of the following situations:
 Vacancies created due to expansion, diversification, and growth of business.
 An increase in the competitive advantage of certain concerns, enabling them to get more of the
available business than formerly.
 An increase in business arising from an upswing during the recovery period of a business cycle.
 Vacancies created due to transfer, promotion, retirement, termination, permanent disability or death.
 The normal population growth, which requires increased goods and services to meet the needs of the
people.
 A rising standard of living, which requires more of the same goods and services as well as the
creation of new wants to be satisfied.
Process of Recruitment:
Recruitment process passes through the following stages:
 Recruitment process begins when the personnel department receives requisitions for recruitment from
any department of the company, The personnel requisitions contain details about the position to be
filled, number of persons to be recruited, the duties to be performed, qualifications expected from the
candidates, terms and conditions of employment and the time by which the persons should be
available for appointment etc.
 Locating and developing the sources of required number and type of employees.
 Identifying the prospective employees with required characteristics.
 Developing the techniques to attract the desired candidates. The goodwill of an organisation in the
market may be one technique. The publicity about the company being a good employer may also
help in stimulating candidates to apply. There may be others of attractive salaries, proper facilities for
development etc.
 Evaluating the effectiveness of recruitment process.
According to Famularo, personnel recruitment process involves five elements, viz., a recruitment policy, a
recruitment organization, a forecast of manpower, the development of sources of recruitment, and different
techniques used for utilizing these sources, and a method of assessing the recruitment programme. The
explanation of these is described below:

1. Recruitment Policy: It specifies the objectives of recruitment and provides a framework for the
implementation of the recruitment programme. It also involves the employer’s commitment to some
principles as to find and employ the best qualified persons for each job, to retain the most promising of those
hired, etc. It should be based on the goals, needs and environment of the organization.
[Link] Organisation: The recruitment may be centralised like public sector banks or decentralised.
Both practices have their own merits. The choice between the two will depend on the managerial philosophy
and the particular needs of the organisation.
[Link] of Recruitment: Various sources of recruitment may be classified as internal and external. These
have their own merits and demerits.
[Link] of Recruitment: Recruitment techniques are the means to make contact with potential candidates,
to provide them necessary information and to encourage them to apply for jobs.
[Link] of Recruitment Programme: The recruitment process must be evaluated periodically. The criteria
for evaluation may consist of cost per applicant, the hiring ratio, performance appraisal, tenure of stay, etc. After
evaluation, necessary improvements should be made in the recruitment programme.

Figure shows Place of Recruitment in Selection System

Human
Recruitment Selection Placemen
Resource

Search for Evaluating

Prospective Recruiting

Upgrading in
Personnel Same Position
Research
Internal Transferring
Sources to New Job
Job Posting
Prompting
to Higher

Employee
Referrals
External Advertising Evaluating
Sources for Selection
Scouting

Recruitment Policy:
Recruitment policy covers the following areas:
 To prescribe the degree of emphasis. Inside the organisation or outside the organisation.
 To provide the weightage that would be given to certain categories of people such as local
population, physically-handicapped personnel, personnel from scheduled castes/tribes and other
backward classes.
 To prescribe whether the recruitment would be centralised or decentralised at unit levels.
 To specify the degree of flexibility with regard to age, qualifications, compensation structure and
other service conditions.
 To prescribe the personnel who would be involved in recruitment process and the role of human
resource department in this regard.
 To specify the budget for meeting the expenditures incurred in completing the recruitment process.

According to Yoder, “the recruitment policy is concerned with quantity and qualifications of manpower.” It
establishes broad guidelines for the staffing process. Generally, the following factors are involved in a
recruitment policy:

 To provide each employee with an open road and encouragement in the continuing development of
his talents and skills;
 To provide individual employees with the maximum of employment security, avoiding, frequent lay-
off or lost time;
 To avoid cliques which may develop when several members of the same household or community are
employed in the organisation;
 To carefully observe the letter and spirit of the relevant public policy on hiring and, on the whole,
 employment relationship;
 To assure eachemployee of the organisation interest in his personalgoals and employment objective;
 To assure employees of fairness in all employment relationships, including promotions and transfers;
 To provide employment in jobs which are engineered to meet the qualifications of handicapped
workers and minority sections; and To encourage one or more strong, effective, responsible trade
unions among the employees
Prerequisites of a Good Recruitment Policy: The recruitment policy of an organization must satisfy the
following conditions:
 It should be in conformity with its general personnel policies;
 It should be flexible enough to meet the changing needs of an organization;
 It should be so designed as to ensure employment opportunities for its employees on a long-term
basis so that the goals of the organization should be achievable; and it should develop the potentialities of
employees;
 It should match the qualities of employees with the requirements of the work for which they are
employed; and
 It should highlight the necessity of establishing job analysis.

Factor Affecting Recruitment

The factors affecting recruitment can be classified as internal and external factors.

The internal factors are:

 Wage and salary policies;
 The age composition of existing working force;
 Promotion and retirement policies;
 Turnover rates;
 The nature of operations involved the kind of personnel required;
 The level and seasonality of operations in question;
 Future expansion and reduction programmes;
 Recruiting policy of the organization;
 Human resource planning strategy of the company;
 Size of the organization and the number of employees employed;

 Cost involved in recruiting employees, and finally;

 Growth and expansion plans of the organization.

The external factors are:

 Supply and demand of specific skills in the labor market;
 Company’s image perception of the job seekers about the company.
 External cultural factors: Obviously, the culture may exert considerable check on recruitment. For
example, women may not be recruited in certain jobs in industry.
 Economic factors: such as a tight or loose labour market, the reputation of the enterprise in the
community as a good pay master or otherwise and such allied issues which determine the quality and
quantity of manpower submitting itself for recruitment.
 Political and legal factors also exert restraints in respect of nature and hours of work for women and
children, and allied employment practices in the enterprise, reservation of Job for SC, ST and so on.
Sources of Recruitment: After the finalization of recruitment plan indicating the number and type of
prospective candidates, they must be attracted to offer themselves for consideration to their employment.
This necessitates the identification of sources from which these candidates can be attracted. Some
companies try to develop new sources, while most only try to tackle the existing sources they have. These
sources, accordingly, may be termed as internal and external.
Internal Sources:
It would be desirable to utilize the internal sources before going outside to attract the candidates. Yoder and
others suggest two categories of internal sources including a

 The review of the present employees and nomination of candidates by employees.

 Effective utilization of internal sources necessitates an understanding of their skills and information
regarding relationships of jobs. This will provide possibilities for horizontal and vertical transfers
within the enterprise eliminating simultaneous attempts to lay off employees in one department and
recruitment of employees with similar qualification for another department in the company.
 Promotion and transfers within the plant where an employee is best suitable improves the morale
along with solving recruitment problems. These measures can be taken effectively if the company has
established job families through job analysis programmes combining together similar jobs demanding
similar employee characteristics.
 Again, employees can be requested to suggest promising candidates. Sometimes, employees are given
prizes for recommending a candidate who has been recruited.
 Despite the usefulness of this system in the form of loyalty and its wide practice, it has been pointed
out that it gives rise to cliques posing difficulty to management. Therefore, before utilizing this
system attempts should be made to determine through research whether or not employees thus
recruited are effective on particular jobs.
 Usually, internal sources can be used effectively if the numbers of vacancies are not very large,
adequate, employee records are maintained, jobs do not demand originality lacking in the internal
sources, and employees have prepared themselves for promotions.
Merits of Internal Sources: The following are the merits of internal sources of recruitment:

 It creates a sense of security among employees when they are assured that they would be preferred in
filling up vacancies.
 It improves the morale of employees, for they are assured of the fact that they would be preferred
over outsiders when vacancies occur.
 It promotes loyalty and commitment among employees due to sense of job security and opportunities
for advancement.
 The employer is in a better position to evaluate those presently employed than outside candidates.
This is because the company maintains a record of the progress, experience and service of its
employees.
 Time and costs of training will be low because employees remain familiar with the organization and its
policies.
 Relations with trade unions remain good. Labour turnover is reduced.

Demerits of Internal Sources: However, this system suffers from certain defects as:

 There are possibilities that internal sources may“dry up”, and it may be difficult to find the requisite
personnel from within an organisation.
 It often leads to inbreeding, and discourages new blood from entering and organisation.
 As promotion is based on seniority, the danger is that really capable hands may not be chosen. The
likes and dislikes of the management may also play an important role in the selection of personnel.
 Since the learner does not know more than the lecturer, no innovations worth the name can be
made. Therefore, on jobs which require original thinking (such as advertising, style, designing and
basic research), this practice is not followed.
This source is used by many organisations; but a surprisingly large number ignore this source, especially for
middle management jobs.
External Sources

DeCenzo and Robbins remark, “Occasionally, it may be necessary to bring in some ‘new blood’ to broaden
the present ideas, knowledge, and enthusiasm.” Thus, all organizations have to depend on external sources of
recruitment. Among these sources are included:
 Employment agencies.
  Educational and technical institutes. and
 Casual labour or “applicants at the gate” and nail applicants.

Public and private employment agencies play a vital role in making available suitable employees for different
positions in the organizations. Besides public agencies, private agencies have developed markedly in large
cities in the form of consultancy services. Usually, these agencies facilitate recruitment of technical and
professional personnel. Because of their specialization, they effectively assess the needs of their clients and
aptitudes and skills of the specialized personnel. They do not merely bring an employer and an employee
together but computerize lists of available talents, utilising testing to classify and assess applicants and use
advanced techniques of vocational guidance for effective placement purposes.
Educational and technical institutes also form an effective source of manpower supply. There is an increasing
emphasis on recruiting student from different management institutes and universities commerce and
management departments by recruiters for positions in sales, accounting, finance, personnel and production.
These students are recruited as management trainees and then placed in special company training
programmes. They are not recruited for particular positions but for development as future supervisors and
executives. Indeed, this source provides a constant flow of new personnel with leadership potentialities.
Frequently, this source is tapped through on-campus interview with promising students.
In addition, vocational schools and industrial training institutes provide specialised employees, apprentices,
and trainees for semiskilled and skilled jobs. Persons trained in these schools and institutes can be placed on
operative and similar jobs with a minimum of in-plant training. However, recruitment of these candidates must
be based on realistic and differential standards established through research reducing turnover and
enhancing productivity.

Skill/Level Recruiting Source Percentage of Use

Unskilled and Semiskilled Informal contacts 85
Walk-ins 74
Public Employment Agencies 66
Want Ads 52
Skilled Informal Contacts 88
Walk-ins 66
Public Employment Agencies 55
Want Ads 55
Professional Employees Internal Search 94
Informal Contacts 92
Walk-ins 71
Public Employment Agencies 52
Want Ads 48
Private Employment Agencies 22
Managerial Level Internal Search 100
Informal Contacts 71
Walk-ins 31
Private Employment Agencies 20
Want Ads 17
Public Employment Agencies 12
Table shows Recruiting Sources Used by Skill and Level
Advantages of External Recruitment: External sources of recruitment are suitable for the following
reasons:
 It will help in bringing new ideas, better techniques and improved methods to the organisation.
 The cost of employees will be minimised because candidates selected in this method will be placed
in the minimum pay scale.
 The existing employees will also broaden their personality.
 The entry of qualitative persons from outside will be in the interest of the organisation in the long
run.
  The suitable candidates with skill, talent, knowledge are available from external sources.
 The entry of new persons with varied expansion and talent will help in human resource mix.

Disadvantages of External Sources:

 Orientation and training are required as the employees remain unfamiliar with the organisation.
 It is more expensive and time-consuming. Detailed screening is necessary as very little is known
about the candidate.
 If new entrant fails to adjust himself to the working in the enterprise, it means yet more expenditure on
looking for his replacement.
 Motivation, morale and loyalty of existing staff are affected, if higher level jobs are filled from
external sources. It becomes a source of heart-burning and demoralisation among existing employees.
Methods of Recruitment:
Methods of recruitment are different from the sources of recruitment. Sources are the locations where
prospective employees are available. On the other hand, methods are way of establishing links with the
prospective employees. Various methods employed for recruiting employees may be classified into the
following categories

Based on personnel to be recruited

Managerial/technical personnel Operative personnel
Advertisement Public employment exchanges
Internet Labour unions
Walk-ins Employee referrals
Campus recruitments Gate hiring
Job fairs Labour contractors
Consultancy firms
Personnel contacts
Poaching and raiding
Based on the movement of the organisation
Direct methods Third party method
Advertisement Consultancy firms
Internet recruiting Public employment exchanges
Campus recruitment Labour unions
Job fairs Employee referrals
Personnel contacts Labour contractors
Gate hiring

Philosophies of Recruitment:

There are basically two philosophies of recruitment:

 Traditional
 Realistic
 The traditional philosophy is to get as many people as possible to apply for the job. As a
result of this, a large number of job seekers apply for the job, which makes the final
selection process difficult and can often result in the selection of wrong candidates. Wrong
selection can, in turn, lead to employee dissatisfaction and turnover in the long run.

 In realistic philosophy, the needs of the organisation are matched with the needs of the
applicants, which enhance the effectiveness of the recruitment process. In realistic approach,
the employees who are recruited will stay in the organisation for a longer period of time and
will perform at higher level of effectiveness
Differences between Traditional & Realistic Job Preview
Traditional Job Preview Realistic Job Preview
Setting unrealistic and high job expectations. Setting realistic job expectations.
 Job is viewed by the candidates as highly attractive Attractiveness of job is evaluated in the
light of realistic job expectations
High rate of acceptance of job offers. Some accept and some reject job
offers.
High expectation belied by actual job experience Expectations are confirmed by job
experience.
Creations of dissatisfaction, frustration and Creation of satisfaction in the light of
thoughts for leaving the job job expectations.
High rate of personnel turnover and lower rate of High rate of personnel retention and
job survival high rate of job survival

Selection: Definition & Process:

Human resource selection is the process of choosing qualified individuals who are available to fill positions in
an organization. In the ideal personnel situation, selection involves choosing the best applicant to fill a
position. Selection is the process of choosing people by obtaining and assessing information about the
applicants with a view to matching these with the job requirements. It involves a careful screening and
testing of candidates who have put in their applications for any job in the enterprise. It is the process of
choosing the most suitable persons out of all the applicants. The purpose of selection is to pick up the right
person for every job.
According to Dale Yoder, “Selection is the process in which candidates for employment are divided into two
classes-those who are to be offered employment and those who are not”.
According to Thomas Stone, “Selection is the process of differentiating between applicants in order to
identify (and hire) those with a greater likelihood of success in a job”.
In the words of Michael Jucius, “The selection procedure is the system of functions and devices
adopted in a given company for the purpose of ascertaining whether or not candidates possess the
qualifications called for by a specific job or for progression through a series of jobs.”
According to Keith Davis, “Selection is the process by which an organisation chooses from a list of
screened applicants, the person or persons who best meet the selection criteria for the position available.”
Dale Yoder says, “Selection has long held a high rank in the priority of problem areas in management.
Investments in good people produce a very high rate of return. A good choice of people can provide a
basis for long, sustained contributions.”
Difference between Recruitment and Selection: Difference between recruitment and selection has been
described by Flippo as, “Recruitment is a process of searching for prospective employees and stimulating
and encouraging them to apply for jobs in an organisation. It is often termed positive as is stimulates people
to apply for jobs, selection on the other hand tends to be negative because it rejects a good number of those
who apply, leaving only the best to be hired.” Recruitment and selection differs in following manner:

1. Difference in Objective: The basic objective of recruitment is to attract maximum number of candidates so that
more options are available. The basic objective of selection is to choose best out of the available candidates.

2. Difference is Process: Recruitment adopts the process of creating application pool as large as possible and
therefore. It is known as positive process. Selection adopts the process through which more and more
candidates are rejected and fewer candidates are selected or sometimes even not a single candidate is selected.
Therefore, it is known as negative process or rejection process.
3. Technical Differences: Recruitment techniques are not very intensive, and not require high skills. As against
this, in selection process, highly specialised techniques are required. Therefore, in the selection process, only
personnel with specific skills like expertise in using selection tests, conducting interviews, etc., are involved.
4. Difference in Outcomes: The outcome of recruitment is application pool which becomes input for
selection process. The outcome of selection process is in the form of finalising candidates who will be
offered jobs.
 Selection Procedure: The selection procedure is concerned with securing relevant information about an
applicant. This information is secured in a number of steps or stages. The objective of selection process is to
determine whether an applicant meets the qualification for a specific job and to choose the applicant who is
most likely to perform well in that job. Selection is a long process, commencing from the preliminary
interview of the applicants and ending with the contract of employment (sometimes).
The major factors which determine the steps involved in a selection process are as follows:
 Selection process depends on the number of candidates that are available for selection.
 Selection process depends on the sources of recruitment and the method that is adopted for
making contact with the prospective candidates.
 Various steps involved in as selection process depend on the type of personnel to be selected.
All the above factors are not mutually exclusive, rather these operate simultaneously. In any case, the basic
objective of a selection process is to collect as much relevant information about the candidates as is
possible so that the most suitable candidates are selected. Acomprehensive selection process involves the
various steps as shown in Figure shown below.

1. Application Pool: Application pool built-up through recruitment process is the base for selection process.
The basic objective at the recruitment level is to attract as much worthwhile applications as possible so that
there are more options available at the selection stage.
2. Preliminary Screening and Interview: It is highly noneconomic to administer and handle all the
applicants. It is advantageous to sort out unsuitable applicants before using the further selection steps.
3. Application Blank or Application Form: An application blank is a traditional widely accepted device for
getting information from a prospective applicant which will enable the management to make a proper
selection. The blank provides preliminary information as well as aid in the interview by indicating areas of
interest and discussion
(a) Biographical Data: Name, father’s name, data and place of birth, age, sex, nationality, height, weight,
 identification marks, physical disability, if any, marital status, and number of dependents.
(b) Educational Attainment: Education (subjects offered and grades secured), training acquired in special
fields and knowledge gained from professional/technical institutes or through correspondence courses.
(c) Work Experience: Previous experience, the number of jobs held with the same or other employers,
including the nature of duties, and responsibilities and the duration of various assignments, salary
received, grades, and reasons for leaving the present employer.
(d) Salary and Benefits: Present and expected.
(e) Other Items: Names and addresses of previous employers, references, etc. An application blank is a
brief history sheet of an employee’s background and can be used for future reference, in case needed.
The application blank must be designed from the viewpoint of the applicant as well as with the
company’s purpose in mind.
Application form helps to serve many functions like:
 Its main usefulness is to provide information for reference checking, good interviewing, and
correlation with testing data.
 It helps to weed out candidates who are lacking in education, experience or some other eligibility
traits.
 It helps in formulating questions to be asked in the interview.
 Data contained in application form can be stored for future reference.
 It also tests the candidate’s ability to write, to organize his thoughts, and to present facts clearly and
succinctly.
 It indicates further whether the applicant has consistently progressed to better jobs. It provides
factual information.
Weighted Application Blanks
Some organisations assign numeric values or weights to the responses provided by the applicants. This
makes the application form more job related. Generally, the items that have a strong relationship to job
performance are given higher scores

Several problems associated with WAB e.g.

 It takes time to develop such a form.
 The WAB would have to be updated every few years to ensure that the factors previously identified are
still valid products of job success.
 The organisation should be careful not to depend on weights of a few items while finally selecting the
employee.

4. Selection Tests: Many organisations hold different kinds of selection tests to know more about the
candidates or to reject the candidates who cannot be called for interview etc. Selection tests normally
supplement the information provided in the application forms. Such forms maycontain factual information
about candidates. Selection tests may give information about their aptitude, interest, personality, which
cannot be known by application forms. Types of tests and rules of good of testing have been discussed in
brief below:

A. Aptitude Tests: These measure whether an individual has the capacity or talent ability to learn a
given job if given adequate training. These are more useful for clerical and trade positions.

B. Personality Tests: At times, personality affects job performance. These determine personality traits
of the candidate such as cooperativeness, emotional balance etc. These seek to assess an
individual’s motivation, adjustment to the stresses of everydaylife, capacityfor interpersonalrelations and
self-image.

C. Interest Tests: These determine the applicant’s interests. The applicant is asked whether he likes,
 dislikes, or is indifferent to many examples of school subjects, occupations, amusements,
peculiarities of people, and particular activities.
D. Performance Tests: In this test the applicant is asked to demonstrate his ability to do the job. For
example, prospective typists are asked to type several pages with speed and accuracy.

E. Intelligence Tests: This aim at testing the mental capacity of a person with respect to reasoning,
word fluency, numbers, memory, comprehension, picture arrangement, etc. It measures the ability to
grasp, understand and to make judgement.

F. Knowledge Tests: These are devised to measure the depth of the knowledge and proficiency in
certain skills already achieved by the applicants such as engineering, accounting etc.

G. Achievement Tests: Whereas aptitude is a capacity to learn in the future, achievement is concerned
with what one has accomplished. When applicants claim to know something, an achievement test is
given to measure how well they know it.

H. Projective Tests: In these tests the applicant projects his personality into free responses about
pictures shown to him which are ambiguous.
Rules of Good Testing
 Norms should be developed for each test. Their validity and reliability for a given purpose should be
established before they are used.
 Adequate time and resources must be provided to design, validate, and check tests.
 Tests should be designed and administered only by trained and competent persons.
 The user of tests must be extremely sensitive to the feelings of people about tests.
 Tests are to be uses as a screening device.
 Reliance should not be placed solely upon tests in reaching decisions.
 Tests should minimize the probabilities of getting distorted results. They must be ‘race-free’.
 Tests scores are not precise measures. They must be assigned a proper weightage.
5. Interview: An interview is a procedure designed to get information from a person and to assess his
potential for the job he is being considered on the basis of oral responses by the applicant to oralinquiries by
the interviewer. Interviewer does a formal in-depth conversation with the applicant, to evaluate his
suitability. It is one of the most important tools in the selection process. This tool is used wheninterviewing
skilled, technical, professional and even managerialemployees. It involves two-wayexchange of information. The
interviewer learns about the applicant and the candidate learns about the employer.
Objectives of Interviews: Interview helps:
 To obtain additional information from the candidate.
 Facilitates giving to the candidate information about the job, company, its policies, products etc.
 To assess the basic suitability of the candidate.
The selection interview can be:
 One to one between the candidate and the interviewer:
 Two or more interviewers by employers representatives-sequential;
 By a panel of selections, i.e., by more than representative of the employer.
The sequential interview involves a series of interviews; each interviewer meeting the candidate separately. The
panel interview consists of two or more interviews meeting the candidate together.

Types of interviews: Interviews can be classified in various ways according to:

(A) Degree of Structure
(B) Purpose of Interview
(C) Content of Interview
 (A) Degree of Structure:

(1) Unstructured or non directive: in which you ask questions as they come to mind. There is no set
format to follow.

(2) Structured or directive: in which the questions and acceptable responses are specified in
advance. The responses are rated for appropriateness of content.
Structured and non-structured interviews have their pros and cons. In structured interviews all applicants are
generally asked all required questions by all interviewers. Structured interviews are generally more valid.
However structured interviews do not allow the flexibility to pursue points of interests as they develop.

(B) Purpose of Interview: A selection interview is a type of interview designed to predict future job
performance, on the basis of applicant’s responses to the oral questions asked to him.
A stress interview is a special type of selection interview in which the applicant is made uncomfortable by
series of awkward and rude questions. The aim of stress interview is supposedly to identify applicant’s low or
high stress tolerance. In such an interview the applicant is made uncomfortable by throwing him on the defensive
by series of frank and often discourteous questions by the interviewer.

(C) Content of Interview: The content of interview can be of a type in which individual’s ability to
project a situation is tested. This is a situation type interview. In job-related interview, interviewer
attempts to assess the applicant’s past behaviours for job related information, but most questions are
not considered situational.
In a behaviour interview a situation in described and candidates are asked how they behaved in the past in
such a situation. While in situational interviews candidates are asked to describe how they would react to
situation today or tomorrow. In the behavioural interview they are asked to describe how they did react to the
situation in the past.
Principles of Interviewing

To make it effective, an interview should be properly planned and conducted on certain principles; Edwin
B. Flippo has described certain rules and principles of good interviewing to this end:
 Provide proper surroundings. The physical setting for the interview should be both private and
comfortable.
 The mentalsetting should be one of rapport. The interviewer must be aware ofnon-verbal behaviour.
 Plan for the interview by thoroughly reviewing job specifications and job descriptions.
 Determine the specific objectives and the method of the interviewing.
 Inform yourself as much as possible concerning the known information about the interviewee.
 The interviewer should possess and demonstrate a basic liking and respect for people.
 Questions should be asked in a manner that encourages the interviewee to talk. Put the applicant at
ease.
 Make a decision only when all the data and information are available. Avoid decisions that are
based on first impressions.
 Conclude the interview tactfully, making sure that the candidate leaves feeling neither too elated
nor frustrated.
 Maintain some written record of the interview during or immediately after it.
 Listen attentively and, if possible, protectively.

64
  Questions must be stated clearly to avoid confusion and ambiguity. Maintain a balance between open and
overtly structured questions.
 ‘Body language’ must not be ignored.
 The interviewer should make some overt sign to indicate the end of the interview.
Interviewing is largely an art, the application of which can be improved through practice.

6. Background Investigation: The next step in the selection process is to undertake an investigation of those applicants
who appear to offer potential as employees. This may include contacting former employers to confirm the candidate’s
work record and to obtain their appraisal of his or her performance/ contacting other job-related and personal
references, and verifying the educational accomplishments shown on the application.
The background investigation has major implications. Every personnel administrator has the responsibility to investigate
each potential applicant. In some organization, failure to do so could result in theloss of his or her job. But many
managers consider the background investigation data highly biased. Who would actually list a reference that would not
give anything but the best possible recommendation? The seasoned personnel administrator expects this and delves deeper
into the candidate’s background, but that, too, may not prove to be beneficial. Many past employers are reluctant to
give any information to another company other than factual information (e.g., date of employment).
Even though there is some reluctance to give this information, there are ways in which personnel administrators can
obtain it. Sometimes, for instance information can be obtained from references once removed. For example, the
personnel administrator can ask a reference whose name has been provided on the application form to give another
reference, someone who has knowledge of the candidate’s work experience. By doing this, the administrator can eliminate
the possibility of accepting an individual based on the employee’s current employer’s glowing recommendation when the
motivation for such a positive recommendation was to get rid of the employee.

7. Physical Examination: After the selection decision and before the job offer is made, the candidate is required to
undergo physical fitness test. Candidates are sent for physical examination either to the company’s physician or to a
medical officer approved for the purpose. Such physical examination provides the following information.
 Whether the candidate’s physical measurements are in accordance with job requirements or not?
 Whether the candidate suffers from bad health which should be corrected?
 Whether the candidate has health problems or psychological attitudes likely to interfere with work efficiency
or future attendance?
 Whether the candidate is physically fit for the specific job or not?
Policy on these physical exams has changed today. Dale Yoder writes, “Modem policy used the physical examination not
to eliminate applicants, but to discover what jobs they are qualified to fill. The examination should disclose the physical
characteristics of the individual that are significant from the standpoint of his efficient performance of the job he may
enter or of those jobs to which he may reasonably expect to be transferred or promoted. It should note deficiencies, not as
a basis for rejection, but as indicating restrictions on his transfer to various positions also.”

8. Approval by Appropriate Authority: On the basis of the above steps, suitable candidates are recommended for
selection by the selection committee or personnel department. Though such a committee or personnel department may
have authority to select the candidates finally, often it has staff authority to recommend the candidates for selection to
the appropriate authority. Organizations may designate the
various authorities for approval of final selection of candidates for different categories of candidates. Thus, for top level
managers, board of directors may be approving authority; for lower levels, even functional heads concerned may be
approving authority.

9. Final Employment Decision: After a candidate is finally selected, the human resource department recommends his
name for employment. The management or board of the company offers employment in the form of an appointment
letter mentioning the post, the rank, the salary grade, the date by which the candidate should join and other terms
and conditions of employment. Some firms make a contract of service on judicial paper. Usually, an appointment is
made on probation in the beginning. The probation period may range from three months to two years. When the
work and conduct of the employee is found satisfactory, he may be confirmed. The personnel department prepare a
waiting list and informs the candidates. In case a person does not join after being selected, the company calls next
65
 person on the waiting list.

10. Evaluation: The selection process, if properly performed, will ensure availability of competent and committed
personnel. A period audit, conducted by people who work independently of the human resource department, will
evaluate the effectiveness of the selection process. The auditors will do a thorough and the intensive analysis and
evaluate the employment programme.
Selection Decision Outcomes
Correct decisions are those where the applicant was predicted to be successful and later did prove to be successful on the
job, or where the applicant was predicted to be unsuccessful and would have performed accordingly if hired. In the former
case, we have successfully accepted; in the latter case, we have successfully rejected. Thus the purpose of selection activities
is to develop outcomes shown as “correct decisions

In summary, selection have two objectives:

(1) to predict which job applicants would be successful if hired and
(2) to inform and sell the candidate on the job and the organization.
Unfortunately, these two objectives are not always compatible Putting a job candidate through hours of filling out
forms, taking tests, and completing interviews rarely endears the organization to the candidate. These are tiresome
and often stressful activities.

66