Staffing

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Staffing

• Human Resource Forecasting
• Employee Recruiting
• III. Employee Selection

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I. Human Resource Forecasting

• Topics
• 1. Benefits of HR
  Forecasting
• 2. Demand Forecasting
• 3. Supply Forecasting
• 4. Balancing Supply
  and Demand

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1. Benefits of HR Forecasting
1. Benefits of HR Forecasting

• 1. Prevent understaffing and disruption to
  operations.
• 2. Prevent overstaffing and subsequent costs of
  employee layoff.
• 3. Allow efficient and effective use of other HR
  functions, such as
• Provide lead time to optimize recruiting.
• Provide larger applicant pools to achieve optimal
  selection ratio.
• Provide optimal number of new hires for training
  programs.
• Prevent wage inflation resulting from crisis
  hiring.

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Selection Ratio

• The percentage of applicants who are offered a
  job.
• The smaller the selection ratio, the higher the
  selection hit rate i.e., the percent of those
  hired who turn out to be acceptable employees.

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

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A. Judgmental Forecasting

• Conducting surveys of operating managers to
  estimate the number of employees needed to
  support current and future operations. Best for
  small and medium sized organizations.

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B. Mathematical Forecasting

• 1. Productivity Ratio
• Average Sales in Past Five Years (500,000)
  Average Number of Operational Employees (200)
  2,500 Sales per Employee

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2. Staffing Ratio

• Average Number of Operational Employees (200)
  Average Number of Support Employees (40) 5 to 1
  (Five operational employees to each support
  (i.e., staff) employee.)
• Therefore, if 220 Operational Employees are
  needed, 220 5 44 Support Employees will be
  required.

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C. Statistical Forecasting(Correlation-Regression
Analysis)Y a b (X)

• Number of Sales Volume per Year (x)
• Employees (y)
• 100 1996 - 500,000
• 110 1997 - 560,000
• 120 1998 - 600,000
• 130 1999 - 620,000
• 140 2000 - 680,000
• 150 2001 - 720,000
• 160 2002 - 740,000
• 170 2003 - 760,000

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3. Supply Forecasting(Transition Probability
Matrix)
3. Supply Forecasting
Production Clerical Maintenance Supervisors Quit
Production 800 .80 .02 .05 .04 .09
Clerical 100 .05 .70 .00 .01 .24
Maintenance 100 .00 .00 .70 .05 .25
Supervisors 60 .02 .00 .02 .90 .06
Supply 648 86 111 92 125
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4. Balancing Supply and Demand(See Figure 5.1)
4. Balancing Supply and Demand (See Figure 5.1)

• Demand Exceeds Supply
• Transfer and retrain
• Promotion from within
• Overtime
• Subcontracting
• Part time and temps
• Recruit from outside

• Supply Exceeds Demand
• Reduced hours
• Work sharing
• Voluntary retirements
• Inducement to quit
• Pay freeze or cut
• Layoffs

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II. Employee Recruiting

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

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1. Purposes of Recruiting
1. Purposes of Recruiting

1. Attract a sufficient number of applicants to
   allow an optimal selection ratio.
2. Aid in meeting EEO and diversity goals.
3. Maintain goodwill and positive image of the
   company.

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2. Filling Vacancies from Within
2. Filling Vacancies from Within

• Pros
• Familiarity may increase selection accuracy.
• Employee motivation to perform well and develop
  skills.
• Quicker and lower staffing costs.
• Lower training and adjustment costs.

• Cons
• Current employees may not be prepared.
• May lead to a ripple effect, which increases
  staffing costs.
• May lower the influx of new ideas and innovation.
• May hinder diversity goals.

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Filling Vacancies from Outside.
Filling Vacancies from Outside

• Pros
• Larger number of applicants lowers selection
  ratio and raises hit rate.
• Prevent ripple effect.
• May increase innovation.
• Aid in meeting diversity goals.

• Cons
• Increases staffing costs.
• Increases training and adjustment costs.
• Takes longer to fill vacancies.
• May lower employee motivation to perform well and
  develop skills.

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3. Realistic Job Preview (RJP)
3. Realistic Job Preview (RJP)

• Recruiting studies have indicated that the more
  realistic and complete the information provided
  to applicants, the more likely those hired will
  be satisfied, acclimated, and feel less stress -
  leading to better performance, reduced absences,
  and lower job turnover.

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Reasons RJP is Beneficial
Reasons RJP Is Beneficial

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

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RJP Methodology

• Types of Information
• Job duties and tasks
• Qualifications (education, training, and
  experience)
• Career opportunities
• Organizational rewards
• Employee benefits
• Organizational goals and culture

• Types of Presentations
• Interviews
• Tours
• Brochures
• Videos
• Question and answer

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4. Recruiting Methods
4. Recruiting Methods

• 3. Agency
• USES (Public)
• Commercial Agencies
• Executive Search
• 4. Media
• Newspapers
• Special Publications

• 1. Referrals
• Employee Referrals
• Outside Referrals
• Former Employees
• 2. Direct Contact
• Direct Application
• Professional Conferences
• Vocational-Trade Schools
• College Recruiting
• Internet

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3. Employee Selection

• 1. Measurement Properties
• a. Reliability
• b. Validity
• c. Hit Rate Analysis
• d. Selection Utility
• 2. Types of Selection Methods
• a. What it assesses
• b. Typical reliability
• c. Typical validity

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1a. Measurement Reliability
1a. Measurement Reliability

• Consistency with which an instrument assesses the
  knowledge, skills, or abilities intended.
• Test-Retest Sample of people tested at two
  different points in time.
• Parallel Forms Sample of people tested with two
  forms of the same instrument.

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1b. Measurement Validity
1b. Measurement Validity

• Validity is the extent to which a measurement
  instrument (test, interview, etc.) assesses the
  psychological or physical property (i.e.,
  knowledge, skill, or ability) that it purports
• to measure.
• Types of Validity Evidence
• 1. Construct
• 2. Content
• 3. Criterion
  (i.e., empirical)

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1. Construct Validity Evidence

• Demonstrating through theoretical and research
  evidence that a particular psychological or
  physical trait exists apart from other known
  traits and can be accurately measured.
• Federal courts have allowed this kind of
  evidence, called validity generalization, when
  employers could not conduct their own empirical
  studies due to inadequate employee samples.

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2. Content Validity Evidence

• Demonstrating that a particular selection method
  covers (i.e., measures) certain KSAs that have
  been identified through Job Analysis. This is
  judgmental evidence and is accepted by the EEOC
  for validating direct measures of job knowledge
  or skill but not abilities, which are
  considered psychological constructs.

KSAs
Selection Method
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3. Criterion Validity Evidence

• Requires the employer to conduct an empirical
  study to demonstrate a statistical correlation
  between applicant scores on the selection method
  (x) and scores on subsequent job performance (y).
  
• Two types of empirical evidence Concurrent and
  Predictive.

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1c. Hit Rate Analysis
1c. Hit Rate Analysis

• Hit Rate Percentage of persons hired who turn
  out to be
• acceptable job performers.
• Hit Rate is determined by
• Base Rate Percentage of persons in the
  applicant sample who would be acceptable
  performers if hired randomly i.e., not screened
  in any way.
• Selection Ratio Percentage of applicants who
  are hired from the total applicant sample.
• Selection Validity How accurate the selection
  method is in predicting which applicants will be
  good job performers.

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1c. Hit Rate Analysis
Hit Rate Graph
H





Job Performance





L
L
H
Selection Scores
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1d. Utility Analysis
1d. Selection Utility Analysis
The annual monetary value of a selection method
is equal to the following

• The annual monetary utility of a selection method
  is equal to
• U NTVSDyZx NC
• N is number hired each year.
• T is average tenure.
• V is validity of the method.
• SDy is standard deviation in job performance in
  dollar terms.
• Zx is the cut-off score on the selection method
  expressed in standard deviation units.

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2. Selection Methods Pros and Cons
2. Selection Methods Pros and Cons

• See Course Packet and Study Notes.
• Presented on transparencies!