HA 7712: Human Resource ManagementProfessor Sturman, Spring 2010 Staffing February 25, 2010.

HA 7712: Human Resource Management Professor Sturman, Spring 2010

Staffing

February 25, 2010


Before You Begin the Hiring ProcessBefore You Begin the Hiring Process

• You know what the organization needs – understand your business strategy. • (Business Strategy)

• You know how you will meet the HR demands of the organization’s goals – how HR is planning on accomplishing the business strategy

• (HR Strategy)

• You know what jobs need to be filled – based on HR planning. Projecting your needs

• (HR Planning)

• You know what the jobs require – job analysis – skills and abilities to do that• (Job Analysis)

• You know how to comply with the law – now the law so you won’t get sued• (Legal Issues)


Recruitment/Selection Process

• Planning – collect information and bring people into the company• Determining Needs – to some extent can be yield

management• Determine Decision Strategy• Recruitment Approach

• Data Collection – how to collect information to bring good performers. What tools are going to be used to the hiring procedures• Selection tools

• Decision Making – how are you going to make a decision. Have a method to combine this information.


Recruiting• Sources -

• Internal sources – inside the company – have to have a good system so you don’t lose all your good employees in one position and move them on to another without being able to cover that position with another good employee. No matter what you do you have to do some sort of external hiring.

• External sources - Recruiting - Universities, schools, internet, radio, international, develop relationships with high schools or vocational schools, employment agencies, search firms, look specific at your competitors.

• Approaches• The person – most of the time information about the company is communicated via an

interview or information session. The person can really make a difference. Marketing sales approach (sending alumni to have a better rapport)

• The message• “Sell” – how great the company is, the benefits, the perks, career advancement opportunities. Evidence

suggests this works. People are more likely to accept the job however turnover is high because mostly expectations are not met.

• Realistic job preview (RJP) – you tell people benefits and downside of working for a company. (Hewitt consulting – good example). More people turning down second interviews and job offers. It also suggests that turnover is lower. How fast do you fill a position, efficiency of selecting people to fill the position

• Incentives and Results – trying to induce people to take your job offer.• Old wine and dine approach – one way to try and provide incentives. • Signing bonuses – companies cannot negotiate on starting salaries. Discretion of signing bonus, travel

allowances, moving allocations, one time cash costs tends to be something companies can negotiate on. Companies tend not to lower wages but they can not offer signing bonuses and therefore, they can adjust their recruitment policies to economy without having to adjust their salaries.


Decision Strategy: What Do You Hire For?• Minimize Costs – minimizes selection and recruitment costs so that you can get a maximum

return on investment. If there is much SDY associated with the job then the best strategy is to spend as little as possible. If performance is of no value minimize costs

• Selection is an investment• Still must consider business issues and budget

• Hire for Fit – how well people fit with your corporate culture who share the same norms and values. Happens a lot. Sometimes well thought of, sometime strategic, sometimes not. Ritz Carlton want people who are extremely customer service oriented hire this way. Other companies tend to hire people who are like them (lack of diversity within an organization). An example: Company hiring smart jocks. It is not the strategy of the company but people tend to like people like themselves which creates biases in the interviews. Problem leads to potential lack of diversity which can ultimately mean discriminatory hiring procedures. There are consulting companies that offer this type of service to help hiring for fit (purposely biased results)

• Hire for Trainability – hire people who can be molded into the position or culture you want.

• Hire for Performance – hire someone who can do the job you are hiring for. • Initial performance after hire – who can do the job from day 1. (Hotel School)• Long term performance – who may not be a great performer today but we think has great potential to

develop.


Data Collection: Characteristics of Selection Methods

• Reliability: necessary but not sufficient factor to have validity.• The consistency with which selection information reflects

an individual’s characteristics• Reliability is a necessary but not sufficient factor for there

to be validity

• Validity – some sort of relationship from given data and the outcome. What you see is not necessarily what you get. • The degree to which predictions from selection information

are supported by evidence (scale example)

• Validation• The process of gathering information about predictor

validity


Validity Coefficient

• Validity Coefficient = Correlation Coefficient • Ranges from -1.0 to +1.0

r = 0.65

r = 0.20


Validation• Criterion-Related Validation – most interested in. Looking at the correlation

between the predictor of the selection device and the outcome of the selection device.

• Predictive validation – generally a better method to get more accurate results. Hiring decision, performance appraised and look at how they scored on test and how they performed on job a year later. Look at the correlation a year alter. Test takers are usually highly motivated. (GMAT). Problem is that it takes time and costs money because you are testing all applicants and not hiring all of them.

• Concurrent validation – free incentive, test,

• Content Validation – does selection device reflect on performance on the job.

• Construct Validation – a more academic measurement. Am I measuring what I really want to measure? Personality vs. mood.

• Face Validation – not a form of validation. Does the applicant think the device detects anything? Tests are not done in a vaccume, your applicants do react to them.


How you Hire: Selection Methods

• Applications and resumes• Interviews• Intelligence testing• Job knowledge test• Personality test• Integrity test• References and background checks• Drug Testing


Selection Method: Applications and Resumes • Application form – fill out a document with information, experience etc. A way of

expressing interest in job. Unstructured and designed 10 minutes before the person applies. Very little validity associated with this. Validity LOW (0.1 relation). Very common and generally legal. There is no such thing as an illegal question but you can’t use it in your decision of hiring.

• GPA – correlated 0.2 with performance rates. Evidence that this works with someone’s career.

• Academic and experience ratings – mathematical formula combining school, school quality and GPA. Have a consistent method of adding years of experience, factoring GPA and having a sum number. Regression model – consistency is important in this decision making. Can have moderate validity (0.3) (example: application form, taking info from that and plugging it into the formula can give you some sort of implication)

• Weighted Application Blank (WAB) – how many have you worked… not very subjective. Doesn’t give applicant room to tell what they do. Can be done by phone systems. If they are well designed they can have between moderate and high validity (0.4). They are expensive to develop. They are better for entry level positions because of the number of people that go through. They are very defensible because of legal sensitivity


Selection Method: Interviews • Unstructured interviews – making out the interview as they go along. No

specific rating system on how to score people. Often little training or no training and most interviews that are done are instruction interviews. Get a lot of under-reliability. Relationship between these interviews and performance on the job is 0.1 which is very low. Lack of consistency involved and how are the questions evaluated. Lack of validity. NOT GOOD SELECTION DEVICES.

• Structured interviews – can be one of the best predictors – strong correlation of 0.4-0.5 between interview and performance. Consistent questions designed to be related to the job. Translate questions to a score. And compare information the same way. Requires a lot of HW. Need sample answers.(example: Ritz Carlton). This doesn’t mean they are perfect. 0.75 unexplained but good predictor on how people behave.

• Experiential – when you ask a person to tell you about a time when they did such and such… asks about a specific experience. Better than behavioral. The problem is that for entry level positions they cannot apply this based on experience but they can be asked how they would handle certain situations.

• Behavioral – how would you behave in some sort of circumstance.


Selection Method: Intelligence Testing

• Cognitive ability test – good predictor of job performance some argue it is the best compared to others. Validity 0.4-0.5 but argued sometimes to be higher. Inexpensive. Negative view of this method. That it is a bad predictor of performance. Can cause an adverse impact. • Overall – overall score

• Facets – look at verbal reasoning, special ability and so forth.

• Emotional intelligence – about the ability to monitor one’s own feelings and emotions. Self awareness, social awareness. Not much of a predictor of job performance. Highly correlated with neuroticism. Has grown in popularity because of the negative view of cognitive ability tests.


Selection Method: Job Knowledge Test

• Written test – quizes you how to do the job (example: bar tender). Score how well people do on a test. Very easy to score and a good design can have a good validity of 0.4-0.5.(Example: Intel)

• Simulation – very high validity. Role play. Go through the process of performing a mock situation on the job. (example: hiring a chef, examining them on cooking a meal). Can give you a pretty good idea of how a person will perform on the job but not perfect. Downside of this method is cost!


Selection Method: Personality Test • Personality Type – not really accurate. (Marriott, Fairmont). Not good predictors of performance. Maybe correlated 0.2 but probably lower. Originally used to predict an illness, then first used commercially in police force. Most people are near the mean. Very little differentiation between the categories. Most people clinically normal.

• “Big Five” personality dimensions – the most common but not the only way to do it. Not a very good predictor of performance 0.2• Openness to experience – I am full of ideas, quick to understand things.

Tends to be moderately correlated with cognitive. 0.2-0.3 validity. Cognitive better predictor.

• Conscientiousness – I am always prepared 0.4 validity. Good predictor of performance.

• Extraversion – I am the life of the party, I don’t mind being the center of attention – does have moderate correlation of 0.3

• Agreeableness – no relationship• Neuroticism – I am easily disturbed – no relationship


Selection Method: Integrity Test • Purpose –assess whether people are opt.

Polygraph – not legal for hiring purposes

• Are people actually honest? People are moderately honest.

• Do people fake?

• Cost and ROI – fairly low. Buy in bulk!


Selection Method: References and Background Checks

• Letters and phone calls

• Credit check

• Internet-based background check

• Full investigation


Selection Method: Drug Test • Test types

• Urinalysis• Gas chromatography/mass spectrometry (GCMS), high

performance liquid chromatography, or immunoassay analysis• “Dip stick” test

• Hair test• Saliva test• Sweat test• Evidence?

• Policies• Pre-employment• Random• Post incident


Decision Making

• Collecting Information• Hurdles

• Using Information• Compensatory Decision Processes• Non-Compensatory Decision Processes

• Determining Weights


Diagramming the System

Hurdle 1• Method A

• Method B


• Method B


• Method BAp

pli

can

ts

# ? # ?

Job O

ffers

• How many hurdles?• How many go into each hurdle?• How many come out of each hurdle?• Trade-off validity and cost

HA 7712: Human Resource ManagementProfessor Sturman, Spring 2010 Staffing February 25, 2010.

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