Chapter 21: Developing an effective workforce: recruitment, selection and training

The Recruitment and Selection Process
 
1. A vacancy arises
Why might there be a vacancy?
- If an existing employee leaves
- If the workload increases and more staff are needed to cope with demand
- If an employee is going to be off for a set amount of time
Will there always be a vacancy if an employee leaves?
 
2. Job Description
An outline of the tasks, skills, responsibilities, duties and performance level required.
 
Contains a job title, purpose of the job, who they will answer to, authority given and additional aspects to the job.
 
Informs candidates of what will be expected of them.
 
3. Person Specification
Details of the 'ideal candidate'
Lists ESSENTIAL and DESIRABLE characteristics
 
Essential?                                                          Desirable? 
~ Depends on the job                                        ~ Depends  on the job
but may include:                                                 but may include:
- Punctual                                                          - Sociable
- Reliable                                                           - Interests
- Qualifications                                                  - Extra Qualifications
 
4. Internal or External

Internal Recruitment: Filling a job vacancy by selecting a person who is already employed in the organisation.
 

 
 










External Recruitment: Filling a job vacancy by advertising outside the firm.
 

 
 










5. Advertisements Made
Adverts should include:

• An outline of the job description
• An outline of the person specification
• An outline of the organisation's activities
• Location
• (Wage arrangements) - Varies
• Reward Package
• Contract Type (e.g. Permanent, temporary, part-time etc....)
• Contact for application

6. Advertisements Placed

• Newspapers (Local or National)
• Trade Magazines
• Job Centres
• Employment Agencies
• Local Radio
• Specialist career centres
• Local Schools/colleges
• TV (e.g. Army)
• Internet
• Internal noticeboards/newsletters/shop windows
• Word of mouth
• Headhunting (Poaching from another company)

7. Application Forms
Application forms allows a business to collect information from job applicants in a systematic way. They can assess objectively a candidate's suitability for a job, therefore making it easier to pre-select candidates.

 
8. CVs (Curriculum Vitaes)
CVs are sent to the company via post, in person or online along with the application form.
 
CVs may give more details about the applicant than the application form allows.
 
- CVs contain similar info but are harder to compare than an application form due to diversity of the pool of applicants.

 
9. Shortlisting

• Employers receive many applicants
• Sorting into potential candidates according to who are not suitable in person specification
• Potential sorted through best 'fits' to organisation
• References may be gained before interviews are offered.

10. Interviews
Traditional methods of meeting the applicant to determine their suitability.
Reliance on first impressions and appearance.
 
But there are now new methods of interviews:
 
~ Aptitude Tests
Testing how the applicant copes with a given situation
- It establishes their level of skill
- Could be tested on basic skills such as calculating changes, role play etc...
 
~ Psychometric or personality tests
Establishes whether they have the necessary characteristics e.g. attitudes, creativity, social skills....
- A way of measuring the traits of the candidates through questions and answers
 
~ Assessment Centres
Selection process that can last a day at a time. Observations, tasks, interviews and testing takes place
- Allows a more in depth assessment of the candidates
- Most effective but most expensive
- Most likely to be used for senior positions

 
 
 
 
 






Training

Training is the provision of work-related education, either on-the-job or off-the-job, involving employees being taught new skills or improving skills they already have.

Training needs
Training essentially arises when the knowledge and skills required by the firm exceed or differ from those that workers currently possess.
Often a response to some sort of change, possible changes are=
- Development and introduction of new products
- Deconstructing of a firm
- Development and introduction of technology
- Changes to procedure, including improvements to customer service
- High labour turnover
- Low moral
- Changes in legislation

Benefits of Training

• The workers will work to the standard of an experienced worker.
• Means the employees will have the required skills, qualifications etc...
• It develops a knowledgeable and motivated workforce, increasing job satisfaction.
• Increases efficiency and productivity therefore resulting in production of high quality goods/services, which could lead to an increase in profits
• It reveals the employees potential, therefore increases chances of promotion, increasing motivation.
• Reduces cost in long run, due to reduced number of injuries, reduction of poor quality/wasted goods, and increased worker's productivity.
• Encourages employees to work towards the organisations objectives/aims.
• Improve image of the company
• Customers have more confidence in well trained staff.

Internal and External Training
 
External Training
Takes place away from the workplace.
Such as joining a college course on business management.
External training gives employees the opportunity to meet people from other organisations allowing an interchange of ideas and broadening of understanding.
Can make employees feel valued and increase motivation.
 
Internal Training
Takes place within the organisation in a work context.
Appropriate if training needs to be specific to the individual organisation.
E.g. If an employee needs to learn how to use a particular new computer system.



On-the-job and Off-the-job Training

On-the-job training is where an employee learns a job by seeing how it is carried out by an experienced employee.

• On-the-job is likely to be cheaper than off-the-job training. This could be because existing employees and equipment can be used.
• It is a realistic environment. Avoids problems in adjusting (e.g. between college and work situations). There is also no loss of output.
• The negatives are that the quality of training depends on the ability and willingness of the instructor and time available.
• Also the employee chosen as an instructor ay be unable to teach proper skills and may have developed bad habits/shortcuts.
• The work situation may be noisy or stressful. Making it hard to conduct effective learning.

Off-the-job training is all forms of employee education apart from that at the immediate workplace.

• Internally (e.g. a conference room) or externally (at college)
• Less immediate pressure from work
• More generic skills and knowledge than job-specific content.
• Uses specially trained experts --> More highly valued by employees --> Increases motivation
• More straight forward to estimate costs of training and easier to monitor progress.
• expenses.
• Expensive

Induction Training

Induction Training is education for new employees, which usually involves learning about the way the business works rather than about the particular job that the individual will do.

- To help new employees settle in quickly
- Ensure they reach the performance required and feel welcome.
- Inductions could include these ideas: Health and safety issues, policies of the organisation, physical facilities, hierarchy an departmental systems

The programme is likely to:

• Reduce labour turnover
• Employees contribute to organisation quickly
• Increased motivation
• Improves understanding of corporate culture and the situation in which the organisation is placed.

Chapter 20: Measuring the effectiveness of the workforce

Labour Productivity

Labour productivity is a measure of the OUTPUT PER WORKER in a given TIME PERIOD.

Example 1:

 

If a factory has 76 employees and its output is 41,192 units per year, what is its labour productivity?

 

Answer:    41,192

                    76                = 542 units per employee
 

 

 



 

 

 

Labour Turnover

 

Labour turnover is the proportion of employees leaving a business over a period of time - usually a year.

 

 

 

Example 2:

 

 

 

 

 

 

 

 

 

 
 

How to calculate the average number employed:

The average number of employees can be calculated by adding the number of people at the start of the year to the number of people employed at the end of the year and divide the total by 2.

 

Leavers

All leavers are people who leave voluntary and non-voluntary. Non-voluntary leavers would include people who had been made redundant, were sacked or died. Voluntary leavers are people who chose to leave.

 

Internal Causes of Labour Turnover:

• Poor management
• Poor communication
• Poor selection procedures
• Low remuneration rates (pay)
• Monotonous jobs
• Poor working conditions
• Low motivation and morale

External Causes of Labour Turnover:

• New competition
• Higher wages elsewhere
• Better training elsewhere
• More local jobs
• More interesting jobs

 

Issues with high labour turnover:

• Increasing recruitment and selection costs (To replace staff who leave - advertising positions, conducting interviews)
• Increasing induction and training costs (So staff learn the skills needed, staff become familiar with the practices of the business)
• Costs of redesigning jobs in reaction to these rates (Making the job simpler so it is easier to replace staff)
• Reduced productivity rates (Due to skilled staff leaving and new, usually untrained staff joining the business)
• Decrease in morale among existing workers (Unsettling as there is a constant change of work colleagues)

How to improve labour turnover:

• Monitoring (Create a monitoring system that includes: Knowing how labour turnover in the company compares with the industry average, tracking trends in employee turnover over time or identifying area/departments where labour turnover is particularly high)
• Exit Interviews (Can identify problem areas in the organisation and common reasons why workers are leaving. Could discuss pay, training, career prospects or the job itself)
• Recruitment and selection (Money spent here could be regained by low labour turnover)
• Induction and training (Making the employee feel welcome in the firm)
• Reducing turnover of long-term workers (These workers have a huge amount of FIRM-SPECIFIC HUMAN CAPITAL - this is skills and knowledge directly relevant to the firm. To retain these long-term workers they could provide career progression or examine their remuneration)

But don't forget that labour turnover can allow:
- New ideas, skills, talents and enthusiasm to the labour force
- Can help a firm avoid complacency
- Prevent an over-reliance on tried and tested ways of working, making it inflexible in response to changes in its environment
- A business can reduce its workforce slowly without having to resort to redundancies - this is called NATURAL WASTAGE.


Absenteeism

Absenteeism is the proportion of employees not at work on a given day.

 

Example 3:

If 33 out of a workforce of 320 are absent on a given day, what is the absenteeism rate?

Answer:   33
               320     x 100        = 10.3%


To find the rate of absenteeism for a year:

Example 4:
 
If the total number of days that could be worked is 250 (5 days x 50 weeks), the total number of employees is 80 and the number of days lost due to absence is 600, what is the annual rate of absenteeism?
 
Answer:      600    
                80 x 250     x 100        = 3%

Causes of Absenteeism:

- Illness (Unavoidable)
- Transportation issues
- Stress
- Industrial Action (e.g. a strike)
- Avoidance of work

Problems of absenteeism:

- Absence means work has to be covered --> Extra cost of agency workers, overtime rates or extra stress put on present employees

- If new and less skilled staff have to be deployed --> Productivity decreases --> Or Quality sacrificed --> Causes dissatisfied customers --> Adversely affect the profitability of the firm.

- If work cannot be covered, deadlines may be missed.

Strategies to reduce absenteeism:

Health and Safety
Refers to the well being of staff in the workplace.


Includes factors such as:
1. Prevention of accidents with machinery
- Adequate training
- Relevant health and safety procedures adhered to.

2. Prevention of injury (e.g. repetitive strain injury)
- Design of the workplace
- Breaks
- Nature of jobs given

- Most accidents and injuries can be prevented with proper training.
- Health and safety incidents may lead to employee absence and even compensation pay-outs from the business!

Example 5:

If over a period of a year there are 250 actual working days and the number of days lost for health and safety reasons is 5, what is the rate of absenteeism due to health and safety?

Answer:      5 
                 250  x 100      = 2%        

Chapter 19: Improving Organisation Structures

Organisation Structure: The relationship between different people and functions in an organisation - both vertically, from shop-floor workers through supervisors and managers to directors, and horizontally between different functions and people at the same level.

Organisation Chart: A diagram showing the lines of authority and layers of hierarchy in an organisation.

A line between two different levels (e.g. A team leader and a supervisor) represents a relationship where instructions are passed downwards, and reports and feedback are passed upwards within the organisation.

When describing the person immediately ABOVE someone in the organisation chart as his or her LINE MANAGER. For example, The team leader's line manager is the manager.

The reporting system from the top of the hierarchy down to the bottom is called the CHAIN OF COMMAND.

Organisational Hierarchy: The vertical division of authority and accountability in an organisation.

Levels of Hierarchy: The number of different supervisory and management levels between the shop floor and the chief executive in an organisation.

In this organisation chart, the marketing function has 3 levels.


Span of Control

Span of control: The number of subordinates whom a manager is required to supervise directly.

If a manger has a lot of subordinates to answer to --> Wide Span of control

If a manger has few subordinates to answer to --> Narrow Span of Control

Relationship between: Span of Control and levels of hierarchy

Normally an organisation with a tall hierarchical structure (i.e. many layers of management), each had a narrow span of control.

Now it is becoming more popular to have a flatter hierarchical structure (reducing the layers of management) and each manager will have a wider span of control.

Here organisation A is a tall structure with 4 layers of management. Organisation B is a flat structure with 2 layers of management. A the top of the triangle is the Top management and at the bottom is the shop-floor workers:

Centralised and Decentralised Structures

Centralised involves authority and responsibility for decision making being in the hands of senior managers (e.g. at a head office).

Decentralisation means that this responsibility is given to individual units/departments/branches or lower-level managers.

Benefits of centralised decision making:

• Greater control over decisions made
• More consistency
• More efficient use of specialist skills of employees and managers.

Benefits of decentralised decision making:

• Increased motivation due to empowerment of lower-level managers
• Skills developed in lower-level managers
• Quicker decision making (However it would be hard for lower-level managers to have an overview and be aware of the wider impact of their decisions)

Delegation

Delegation is the process of passing authority down the hierarchy from a manager to a subordinate.

Responsibility

Being accountable for one's actions.

e.g. A personnel manager may be responsible for ensuring that all employees receive appropriate training for their particular job.

Authority

The ability or power to carry out a task.

Subordinates must have the authority to undertake the various tasks delegated to them. The manager must formally pass authority on to them and is clear and explicit.
For example, if a manager was due to be away and did not give her assistant the authority to sign cheques or make decisions on her behalf, the firm's activities may grind to  halt.
Limits must also be laid out.

Accountability

The extent to which a named individual is held responsibility for the success or failure of a particular policy, project or piece of work.

Accountability remains firmly at the top of the organisation structure.


Factors that can make delegation effective:

• Based on mutual trust between manager and subordinate
• Get the right person to do the job (skilled, trained, can do the task effectively and efficiently)
• Ensure that the interesting tasks, as well as more boring ones, are delegated.
• Effective support system provided (e.g. allows the subordinate to ask questions and discuss issues with their delegated tasks)
• Managers should delegate responsibility and authority. Limitations of the subordinate's authority should be made clear too.
• Managers should not interfere with delegated tasks unless something is going seriously wrong. Subordinates need to feel trusted and that managers have confidence in them.

Communication Flows

Communication: The process of exchanging information or ideas between two or more individuals or groups.

Internal Communication: The exchange of information that takes place within an organisation (e.g. at department meetings, in team briefing sessions and in memos to staff)

External Communication: The exchange of information that takes place with individuals, groups and organisations outside the business (e.g. via advertising material, telephone calls to suppliers and letters to customers).

Good communication means that the organisation will have a more motivated and committed workforce, make better decisions, makes the business better coordinated, and find it easier to implement change.

The Communication Process

One and Two-way communication

One-way communication: Communication WITHOUT any FEEDBACK (e.g. putting a notice on a notice board, or giving instructions in an authoritarian manner that allows no comment or questions from the listener).

Two-way communication: Communication WITH FEEDBACK (e.g. giving instructions in a manner that allows for questions to be asked or comments to be made, a discussion or a question-and-answer session).

In one-way communication, the communicator cannot be sure if the message was fully understood and if it was effective. This communication is associated with autocratic management styles.

However two-way communication ensures that communication is fully understood and so is more effective. Two-way communication is an example of democratic management, effective delegation, empowerment and team working.

Communication Channels

Communication Channel: The route through which communication occurs.

Examples: A team briefing session, works council (a discussion between management and employee representatives about company plans)

Open and closed channels of communications

Open channels of communication: Any staff member is welcome to see, read or hear the discussions and conclusions.

Closed channel of communications: Access to the information is restricted to a named few.

Formal and informal channels of communication

Formal channels of communication: Communication channels established and approved by senior management, within which any form of communication is regarded as formal (e.g. meetings of departmental heads, personnel department meetings and production team briefing sessions).

Informal channels of communication: Means of passing information outside the official channels, often developed by employees themselves (e.g. the 'grapevine' and gossip).

Vertical and lateral communication

Vertical communication: When information is passed up and down the chain of command.

Two types of vertical communication:

1. Downwards communication- Transmitted from the top to the bottom of the organisation, or from superior to subordinate. Usually used to give instructions or inform employees about decisions.

2. Upwards communication- Transmitted from the bottom to the top of the organisation, or from subordinate to superior E.g. feedback, advising of any problems. It can help to improve downwards communication and provide feedback on its effectiveness.

Lateral Communication: When people at the same level within an organisation pass information to each other.

e.g. The finance dep. telling the marketing dep. about the budget available for a sales promotion.

What influences the structure of an organisation?

• The size of the organisation - The larger the organisation --> More complex its structure --> More layers of hierarchy, divisions or departments.
• The nature of the organisation - Manufacturing sector? Service sector? National? Single product or multiple? Needs tight control?
• The culture and attitudes of senior management - Depends on management style (Autocratic and controlling or democratic and participative)
• The skill and experience of its workforce - Do the workers have little skills and do repetitive jobs? Or are they high skilled and do different jobs?