Chapter 3: Human

Resource Planning,
Recruitment,
and
Creating Effective
Selection
Organizations

Development of
Human Resource
Management
Parallels the protection and treatment of
workers
1.

Social Welfare Department

a.
b.
c.

2.

1880 1935
Helping injured workers and their
families
Company unions: parties and social
events
Worker health
1935 1950
Collective bargaining
Contract administration

Industrial Relations Department

a.
b.
c.
d.

1950 1970
Labor relations
Benefits and vacations
Testing and selection
Compensation systems

Personnel Department
a.
b.
c.
d.
e.
f.

Labor Relations Department

a.
b.

3.

4.

5.

1970 1990
Legal compliance
Staffing
Performance evaluation
Compensation and benefits
Employee relations
Safety and health

Human Resource Management

Staffing Model
Strategi
Human
Resourc
e
Planning

Recruitme
nt
Selectio
n

Longrange
planning
Middlerange
planning
Shortrange
planning

Human
Resourc
e
Plannin
Environmenta
g
l Scanning

c
Busines
s
Strategic
Plannin
Planning
g

Operational
Planning

Forecasting

Goals and
Objectives

Projected
Staffing
Requirements
Recruitment
Planning
Applicant Search
Preliminary
Screening
Selection
Decision
Placement

Typical Steps in the

Selection Process

Placement on the job

Selection decision

Final interview
Drug testing
Reference checks
Employment
testing
Interviews
Application
blanks
Preliminary screening

Reject applicant

Forecasting
Employment Needs
1.
2.
3.
4.
5.

Budgeting
Work-load Analysis
Unit Demand
Expert Opinion
Trend Predictions

Example of Predicting Labor Supply and

Required New Hires for a Hotel Chain
Supply Analysis
Supply Demand
Comparison

A
% Quit
(rounded)
(19961998)

B
Number of
Present
Employees

C
Projected
Turnover
by 2000

D
Employees
Left by
2000

E
Projected
Labor
Demand in
2000

F
Projected
New Hires
in 2000

General Manager

38

25

10

15

32

17

Resident Manager

77

12

10

Food/Beverage
Director

47

23

11

12

29

17

Controller

85

25

21

32

28

Assistant Controller

66

14

18

13

Chief Engineer

81

24

16

31

23

Director of Sales

34

25

16

32

16

Sales Manager

68

45

30

15

58

43

Convention Manager

90

14

13

18

17

Catering Director

74

19

14

24

19

Banquet Manager

60

19

12

24

17

Personnel Director

43

15

19

10

Restaurant Manager

89

49

44

63

58

Executive Chef

70

24

17

31

24

Sous Chef

92

24

22

31

29

Key Positions

Solving the Surplus

Personnel Problem
1.
2.
3.
4.
5.

Layoffs
Attrition
Reduced Hours/Job Sharing
Unpaid Vacations
Early Retirements

High Performance Work

Practices Financial
Performance
Sample: 968 U.S. firms with 100 or more employees
Financial Data: 10-K reports with the SEC
High Performance Work Practices: What proportion of the
workforce participates in:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.

Formal information sharing program

Formal job analysis
Hiring from within
Employee attitude surveys
Quality of Work Life Programs
Company incentive, profit-sharing, or gain-sharing plans
Formal grievance and complaint procedures
Pre-employment testing
Performance appraisals are used to determine promotion
Formal performance appraisals
Promotion by seniority or performance
Selection ratio for hiring
What is the average number of hours of training received per
employee per year?

High Performance
Work Practices Results
A one standard deviation increase

from the mean in high performance

work practices is associated with:
7.05% decrease in turnover
$27,044 increase in sales annually per
employee
$18,641 increase in market value annually
per employee
$3,814 increase in profits annually per
employee

Source: Mark A. Huselid, The Impact of Human Resource Management Practices

on Turnover, Productivity, and Corporate Financial Performance. Academy of
Management Journal, vol 38 (1995): 635-672