Lessons 3-8 Human Resource Management PDF
Document Details
Uploaded by Deleted User
Tags
Summary
This document provides an overview of human resource management, focusing on human resource planning and recruitment strategies to maintain a competitive workforce. It discusses various methods for managing labor surplus and shortage, such as downsizing, early retirement programs, and hiring temporary workers.
Full Transcript
LESSON 3 Human Resource Planning and Recruitment 3.1 Overview Human resource managers are at the forefront of the worldwide war for competitive advantage. Organizations need to find the best set of workers for meeting their strategic objectives, attract those workers to the...
LESSON 3 Human Resource Planning and Recruitment 3.1 Overview Human resource managers are at the forefront of the worldwide war for competitive advantage. Organizations need to find the best set of workers for meeting their strategic objectives, attract those workers to their companies, and then get them to stay long enough to obtain some return on their investment. There are advantages and disadvantages associated with different workforces, and organizations that survive and thrive find the best match between the workers they need and the strategy they employ to compete in the market. There are three keys to effectively utilizing labor markets to one‘s competitive advantage. First, companies must have a clear idea of their current configuration of human resources. They need to know the strengths and weaknesses of their present stock of employees. Second, organizations must know where they are going in the future and be aware of how their present configuration of human resources relates to the configuration that will be needed. Third, where there are discrepancies between the present configuration and the configuration required for the future, organizations need programs that will address these discrepancies. 3.2 Learning Outcomes At the end of this lesson, you should be able to: Discuss the advantages and disadvantages of various ways of eliminating a labor surplus and avoiding a labor shortage. Describe the various recruitment policies that organizations adopt to make job vacancies more attractive. List the various sources from which job applicants can be drawn, their relative advantages and disadvantages, and the methods for evaluating them. Explain the recruiter‘s role in the recruitment process, the limits the recruiter faces, and the opportunities available. Identify Recruitment Metrics and their application 3.3 Course Materials Topic 1: The Human Resource Planning Process An overview of human resource planning is depicted in Figure 5.1. The process consists of forecasting, goal setting and strategic planning, and program implementation and evaluation. FORECASTING The attempts to determine the supply of and demand for various types of human resources to predict areas within the organization where there will be future labor shortages or surpluses. The first step in the planning process is forecasting, as shown in the top portion of Figure 5.1. In personnel forecasting, the HR manager attempts to ascertain the supply of and demand for 32 various types of human resources. The primary goal is to predict areas within the organization where there will be future labor shortages or surpluses. Determining Labor Demand Typically, demand forecasts are developed around specific job categories or skill areas relevant to the organization‘s current and future state. Once the job categories or skills are identified, the planner needs to seek information that will help predict whether the need for people with those skills or in that job category will increase or decrease in the future. At the most sophisticated level, an organization might have statistical models that predict labor demand for the next year given relatively objective statistics on leading indicators from the previous year. A leading indicator is an objective measure that accurately predicts future labor demand. Determining Labor Supply Once a company has projected labor demand, it needs to get an indicator of the firm‘s labor supply. Determining the internal labor supply calls for a detailed analysis of how many people are currently in various job categories (or who have specific skills) within the company. This analysis is then modified to reflect changes in the near future caused by retirements, promotions, transfers, voluntary turnover, and terminations. As in the case of labor demand, projections for labor supply can be derived either from historical statistical models or through judgmental techniques. One type of statistical procedure that can be employed for this purpose involves Transitional Matrices, Matrix showing the proportion (or number) of employees in different job categories at different times. Matrices such as these are extremely useful for charting historical trends in the company‘s supply of labor. More important, if conditions remain somewhat constant, they can also be used to plan for the future. As with labor demand, historical precedents for labor supply may not always be reliable indicators of future trends. 33 Determining Labor Surplus or Shortage Once forecasts for labor demand and supply are known, the planner can compare the figures to ascertain whether there will be a labor shortage or labor surplus for the respective job categories. When this is determined, the organization can determine what it is going to do about these potential problems. GOAL SETTING AND STRATEGIC PLANNING The second step in human resource planning is goal setting and strategic planning, The purpose of setting specific quantitative goals is to focus attention on the problem and provide a benchmark for determining the relative success of any programs aimed at redressing a pending labor shortage or surplus. The goals should come directly from the analysis of labor supply and demand and should include a specific figure for what should happen with the job category or skill area and a specific timetable for when results should be achieved. This stage is critical because the many options available to the planner differ widely in their expense, speed, effectiveness, amount of human suffering, and revocability (how easily the change can be undone). Unfortunately for many workers, in the past decade the typical organizational response to a surplus of labor has been downsizing, which is fast but high in human suffering. The human suffering caused by downsizing has both an immediate and a long-term element. In the short term, the lack of pay, benefits, and meaningful work has negative implications for financial, physical, and psychological aspects of individuals, causing bankruptcies, illnesses, and depression. 34 Downsizing The planned elimination of large numbers of personnel designed to enhance organizational effectiveness. Although one tends to think of downsizing as something that a company turns to in times of recession or when facing bouts of poor performance, in fact, many companies that are doing quite well still downsize their workforce regularly for strategic reasons. The key to a successful downsizing effort is to avoid indiscriminant across-the-board reductions, and instead perform surgical strategic cuts that not only reduce costs, but also improve the firm‘s competitive position. Early Retirement Programs and Buyouts Another popular means of reducing a labor surplus is to offer an early retirement program. Several forces fuel the drawing out of older workers‘ careers. First, the improved health of older people in general, in combination with the decreased physical labor. Second, this option is attractive for many workers because they fear Social Security will be cut, and many have skimpy employer-sponsored pensions that may not be able to cover their expenses. Third, age discrimination legislation and the outlawing of mandatory retirement ages have created constraints on organizations‘ ability to unilaterally deal with an aging workforce. Finally, many employers are increasingly concerned about losing the wealth of experience that older workers bring to their companies. Although an older workforce has some clear advantages for employers in terms of experience and stability, it also poses problems. First, older workers are sometimes more costly than younger workers because of their higher seniority, higher medical costs, and higher pension contributions. Employing Temporary Workers Whereas downsizing has been a popular method for reducing a labor surplus, hiring temporary workers and outsourcing has been the most widespread means of eliminating a labor shortage. Temporary employment afforded firms the flexibility needed to operate efficiently in the face of swings in the demand for goods and services. In fact, a surge in temporary employment often preceded a jump in permanent hiring, and was often a leading indicator that the economy was expanding. In addition to flexibility, hiring temporary workers offers several other advantages: o The use of temporary workers frees the firm from many administrative tasks and financial burdens associated with being the ―employer of record.‖ o Small companies that cannot afford their own testing programs often get employees who have been tested by a temporary agency. o Many temporary agencies train employees before sending them to employers, which reduces training costs and eases the transition for both the temporary worker and the company. o Because the temporary worker has little experience in the host firm, the person brings an objective perspective to the organization‘s problems and procedures that is sometimes valuable. 35 Certain disadvantages to employing temporary workers need to be overcome to effectively use this source of labor. For example, in the service sector of the economy, low levels of commitment to the organization and its customers on the part of temporary employees often spills over and reduces the level of customer loyalty. Outsourcing, Offshoring, and Immigration Outsourcing -An organization‘s use of an outside organization for a broad set of services. Outsourcing is a logical choice when a firm simply does not have certain expertise and is not willing to invest time and effort into developing it. Ironically, companies increasingly outsource many of their human resource management tasks to outside vendors who specialize in efficiently performing many of the more routine administrative tasks associated with this function. Offshoring -A special case of outsourcing where the jobs that move actually leave one country and go to another. This kind of job migration has always taken place; however, rapid technological changes have made the current trends in this area historically unprecedented. When making the decision to offshore some product or service, organizations should consider several critical factors. Many who failed to look before they leaped onto the offshoring bandwagon have been disappointed by their results. Quality control problems, security violations, and poor customer service experiences have in many cases wiped out all the cost savings attributed to lower wages and more. If one cannot take the work overseas, but still wishes to tap into less-expensive global talent to fill a labor shortage, then one might simply bring foreign workers into the country. Immigration has always been a vital part of the American economy, and many foreign workers are happy to leave their home and pursue their own American dream. However, entrance of foreign workers into the United States to fill jobs is federally regulated, so there are limits to what can be accomplished here. Employers wishing to hire foreign workers need to help them secure work visas and show that there are no qualified Americans who could do the same work. Altering Pay and Hours Companies facing a shortage of labor may be reluctant to hire new full-time or part-time employees. Under some conditions, these firms may have the option of trying to garner more hours out of the existing labor force. Also, for a short time at least, many workers enjoy the added compensation. However, over extended periods, employees experience stress and frustration from being overworked in this manner. In the face of a labor surplus, organizations can sometimes avoid layoffs if they can get their employees to take pay cuts. PROGRAM IMPLEMENTATION AND EVALUATION The programs developed in the strategic-choice stage of the process are put into practice in the program-implementation stage. A critical aspect of program implementation is to make sure that some individual is held accountable for achieving the stated goals and has the necessary authority and resources to accomplish this goal. It is also important to have regular progress reports on the implementation to be sure that all programs are in place by specified times and that the early returns from these programs are in line with projections. The final step in the planning process is to evaluate the results. 36 Topic 2: The Human Resource Recruitment Process Human Resource Recruitment, The practice or activity carried on by the organization with the primary purpose of identifying and attracting potential employees. As the first half of this chapter shows, it is difficult to always anticipate exactly how many (if any) new employees will have to be hired in a given year in a given job category. The role of human resource recruitment is to build a supply of potential new hires that the organization can draw on if the need arises. The goal of the recruiting is not simply to generate large numbers of applicants. If the process generates a sea of unqualified applicants, the organization will incur great expense in personnel selection, but few vacancies will actually be filled. This problem of generating too many applicants is often promulgated by the use of wide-reaching technologies like the Internet to reach people. PERSONNEL POLICIES Personnel policies is a generic term we use to refer to organizational decisions that affect the nature of the vacancies for which people are recruited. If the research on recruitment makes one thing clear, it is that characteristics of the vacancy are more important than recruiters or recruiting sources when it comes to predicting job choice. Internal versus External Recruiting: Job Security One desirable feature of a vacancy is that it provides ample opportunity for advancement and promotion. One organizational policy that affects this is the degree to which the company ―promotes from within‖—that is, recruits for upper-level vacancies internally rather than externally. In addition to employing promote from within and internal recruiting sources, perceptions of job security and long-term commitment to the organization are also promoted by ―due process policies.‖ Employment-at-Will Policies, Policies which state that either an employer or an employee can terminate the employment relationship at any time, regardless of cause. Companies that do not have employment-at-will provisions typically have extensive due process policies. Due process policies, Policies by which a company formally lays out the steps an employee can take to appeal a termination decision. Extrinsic and Intrinsic Rewards Because pay is an important job characteristic for almost all applicants, companies that take a ―lead-the-market‖ approach to pay—that is, a policy of paying higher-than-current-market wages—have a distinct advantage in recruiting. Pay can also make up for a job‘s less desirable features—for example, paying higher wages to employees who have to work midnight shifts. These kinds of specific shift differentials and other forms of more generic compensating differentials will be discussed in more detail in later chapters that focus on compensation strategies. We merely note here that ―lead‖ policies make any given vacancy more attractive to applicants. Image Advertising 37 Organizations often advertise specific vacancies (discussed next in the section ―Recruitment Sources‖). Sometimes, however, organizations advertise just to promote themselves as a good place to work in general. Image advertising is particularly important for companies in highly competitive labor markets that perceive themselves as having a bad image. Indeed, research evidence suggests that the impact of company image on applicant reactions ranks second only to the nature of the work itself. RECRUITMENT SOURCES The sources from which a company recruits potential employees are a critical aspect of its overall recruitment strategy. The type of person who is likely to respond to a job advertised on the Internet may be different from the type of person who responds to an ad in the classified section of a local newspaper. In this section we examine the different sources from which recruits can be drawn, highlighting the advantages and disadvantages of each. Internal versus External Sources We discussed internal versus external sources of recruits earlier in this chapter and focused on the positive effects that internal recruiting can have on recruits‘ perceptions of job security. In general, relying on internal sources offers a company several advantages. First, it generates a sample of applicants who are well known to the firm. Second, these applicants are relatively knowledgeable about the company‘s vacancies, which minimizes the possibility of inflated expectations about the job. Third, it is generally cheaper and faster to fill vacancies internally. Finally, inside hires often outperform outsiders, especially when it comes to filling jobs at the top end of the hierarchy. With all these advantages, you might ask why any organization would ever employ external recruiting methods. There are several good reasons why organizations might decide to recruit externally. First, for entry-level positions and perhaps even for some specialized upper-level positions, there may not be any internal recruits from which to draw. Second, bringing in outsiders may expose the organization to new ideas or new ways of doing business. Using only internal recruitment can result in a workforce whose members all think alike and who therefore may be poorly suited to innovation. Finally, recruiting from outside sources is a good way to strengthen one‘s own company and weaken one‘s competitors at the same time. This strategy seems to be particularly effective during bad economic times, where ―counter cyclical hiring‖ policies create once-in-a-lifetime opportunities for acquiring talent. Direct Applicants and Referrals Direct Applicants are people who apply for a job vacancy without prompting from the organization. Referrals are people who are prompted to apply for a job by someone within the organization. First, many direct applicants are to some extent already ―sold‖ on the organization. Most of them have done some homework and concluded that there is enough fit between themselves and the vacancy to warrant their submitting an application. This process is called self-selection. A form of aided self-selection occurs with referrals. Many job seekers look to friends, relatives, and acquaintances to help find employment, and evoking these social networks can greatly aid the job search process for both the job seeker and the organization. Current employees (who are 38 knowledgeable of both the vacancy and the person they are referring) do their homework and conclude that there is a fit between the person and the vacancy; they then sell the person on the job. These kinds of ―word-of-mouth‖ endorsements from credible sources seem to have a particularly strong effect early in the recruitment process when people are still unfocused in their search process. Advertisements in Newspapers and Periodicals Advertisements to recruit personnel are ubiquitous, even though they typically generate less desirable recruits than direct applications or referrals—and do so at greater expense. However, because few employers can fill all their vacancies with direct applications and referrals, some form of advertising is usually needed. Moreover, an employer can take many steps to increase the effectiveness of this recruitment method. The two most important questions to ask in designing a job advertisement are, what do we need to say? And To whom do we need to say it? With respect to the first question, many organizations fail to adequately communicate the specifics of the vacancy. Electronic Recruiting One of the easiest ways to get into ―e-cruiting‖ is to simply use the organization‘s own web page to solicit applications. By using their own web page, organizations can highly tune their recruitment message and focus in on specific people. As with any new and developing technology, all of these approaches present some unique challenges. From an employer‘s perspective, the interactive, dynamic, and unpredictable nature of blogs and social networking sites means that sometimes people who have negative things to say about the organization join in on the conversations, and this can be difficult to control. The biggest liability from the applicant‘s perspective is the need to protect his or her identity, because this medium has also been a haven for identity thieves, who post false openings in the hope of getting some applicant to provide personal information. Public and Private Employment Agencies Employers can register their job vacancies with their local state employment office, and the agency will attempt to find someone suitable using its computerized inventory of local unemployed individuals. The agency makes referrals to the organization at no charge, and these individuals can be interviewed or tested by the employer for potential vacancies. Public employment agencies serve primarily the blue-collar labor market; private employment agencies perform much the same service for the white-collar labor market. Unlike public agencies, however, private employment agencies charge the organization for the referrals. Another difference between private and public employment agencies is that one doesn‘t have to be unemployed to use a private employment agency. Colleges and Universities Most colleges and universities have placement services that seek to help their graduates obtain employment. Indeed, on-campus interviewing is the most important source of recruits for entry- level professional and managerial vacancies. Organizations tend to focus especially on colleges 39 that have strong reputations in areas for which they have critical needs (chemical engineering, public accounting, or the like). Many employers have found that to effectively compete for the best students, they need to do more than just sign prospective graduates up for interview slots. One of the best ways to establish a stronger presence on a campus is with a college internship program. Another way of increasing one‘s presence on campus is to participate in university job fairs. In general, a job fair is a place where many employers gather for a short time to meet large numbers of potential job applicants. Evaluating the Quality of a Source Because there are few rules about the quality of a given source for a given vacancy, it is generally a good idea for employers to monitor the quality of all their recruitment sources. One means of accomplishing this is to develop and compare yield ratios for each source. Yield ratios express the percentage of applicants who successfully move from one stage of the recruitment and selection process to the next. Comparing yield ratios for different sources helps determine which is best or most efficient for the type of vacancy being investigated. Table 5.4 shows hypothetical yield ratios and cost-per-hire data for five recruitment sources. For the job vacancies generated by this company, the best two sources of recruits are local universities and employee referral programs. Newspaper ads generate the largest number of recruits, but relatively few of these are qualified for the position. Recruiting at nationally renowned universities generates highly qualified applicants, but relatively few of them ultimately accept positions. Finally, executive search firms generate a small list of highly qualified, interested applicants, but this is an expensive source compared with other alternatives. 40 RECRUITERS Knowing that it is the recruiter‘s job to sell them on a vacancy, some applicants may discount what the recruiter says relative to what they have heard from other sources (like friends, magazine articles, and professors). For these and other reasons, recruiters‘ characteristics and behaviors seem to have less impact on applicants‘ job choices than we might expect. Recruiter’s Functional Area. Most organizations must choose whether their recruiters are specialists in human resources or experts at particular jobs (supervisors or job incumbents). Some studies indicate that applicants find a job less attractive and the recruiter less credible when he is a personnel specialist. This does not completely discount personnel specialists‘ role in recruiting, but it does indicate that such specialists need to take extra steps to ensure that applicants perceive them as knowledgeable and credible. Recruiter’s Traits. Two traits stand out when applicants‘ reactions to recruiters are examined. The first, which could be called ―warmth,‖ reflects the degree to which the recruiter seems to care about the applicant and is enthusiastic about her potential to contribute to the company. The second characteristic could be called ―informativeness.‖ In general, applicants respond more positively to recruiters who are perceived as warm and informative. These characteristics seem more important than such demographic characteristics as age, sex, or race, which have complex and inconsistent effects on applicant responses. Recruiter’s Realism. The recruiter‘s job is to attract candidates, there is some pressure to exaggerate the positive features of the vacancy while downplaying the negative features. Applicants are highly sensitive to negative information. On the other hand, if the recruiter goes too far in a positive direction, the candidate can be misled and lured into taking the job under false pretenses. This can lead to a serious case of unmet expectations and a high turnover rate. Topic 3: Recruitment Metrics Recruiting metrics are an essential part of data-driven hiring and recruitment. Recruiting metrics are measurements used to track hiring success and optimize the process of hiring candidates for an organization. When used correctly, these metrics help to evaluate the recruiting process and whether the company is hiring the right people. 17 MOST RELEVANT RECRUITING METRICS Recruiting metrics are an essential part of data-driven hiring and recruitment. What are recruiting metrics? Recruiting metrics are measurements used to track hiring success and optimize the process of hiring candidates for an organization. When used correctly, these metrics help to evaluate the recruiting process and whether the company is hiring the right people. 41 17 MOST RELEVANT RECRUITING METRICS 1. Time to fill This refers to the time it takes to find and hire a new candidate, often measured by the number of days between publishing a job opening and hiring the candidate. Time to fill is influenced by supply and demand ratios for specific jobs as well as the speed at which the recruitment department operates. It‘s a great metric for business planning and offers a realistic view for the manager to assess the time it will take to attract a replacement for a departing employee. 2. Time to hire Time to hire represents the number of days between the moment a candidate is approached and the moment the candidate accepts the job. In other words, it measures the time it takes for someone to move through the hiring process once they‘ve applied. Time to hire thus provides a solid indication of how the recruitment team is performing. This metric is also called ‗Time to Accept‘. A shorter time to hire often enables you to hire better candidates, preventing the best candidates from being snatched up by a company that does have a short time to hire. It also impacts your candidate experience as nobody likes a recruiting process that takes a long time. This metric is heavily influenced by your recruitment funnel. If you are hiring for jobs that have a relatively straight-forward recruitment process of one interview, the time to hire will be shorter than when you have a phone intake, assessment day, and three rounds of interviews. 3. Source of hire Tracking the sources which attract new hires to your organization is one of the most popular recruiting metrics. This metric also helps to keep track of the effectiveness of different recruiting channels. A few examples are job boards, the company‘s career page, social media, and sourcing agencies. 4. First-year attrition First-year attrition is a key recruiting metric and also indicates hiring success. Candidates who leave in their first year of work fail to become fully productive and usually cost a lot of money. First-year attrition can be managed and unmanaged. Managed attrition means that the contract is terminated by the employer. Unmanaged attrition means that they leave on their own accord. The former is often an indicator of bad first-year performance or bad fit with the team. 42 The second is often an indicator of unrealistic expectations which cause the candidate to quit. This could be due to a mismatch between the job description and the actual job, or the job and/or company has been oversold by the recruiter. This metric can also be turned around as ‗candidate retention rate‘. 5. Quality of hire Quality of hire, often measured by someone‘s performance rating, gives an indicator of first-year performance of a candidate. Candidates who receive high-performance ratings are indicative of hiring success while the opposite holds true for candidates with low-performance ratings. Low first-year performance ratings are indicative of bad hires. A single bad hire can cost a company tens of thousands of dollars in both direct and indirect costs. To read more about how to assess these costs, check out our article on HR costing. When combined with the channel through which the candidate was sourced, you can measure sourcing channel quality. Quality of hire is the input for the Success Ratio. The success ratio divides the number of hires who perform well by the total number of candidates hired. A high success ratio means that most of the hired candidates perform well, however a low ratio means that you need to fine-tune your selection process! The success ratio is used as input for recruitment utility analysis. This analysis enables you to calculate an ROI for different selection instruments. 6. Hiring Manager satisfaction In line with quality of hire, hiring manager satisfaction is another recruiting metric that is indicative of successful recruiting metrics. When the hiring manager is satisfied with the new candidates in his team, the candidate is likely to perform well and fit well in the team. In other words, the candidate is more likely to be a successful hire! 7. Candidate job satisfaction Candidate job satisfaction is an excellent way to track whether the expectations set during the recruiting procedure match reality. A low candidate job satisfaction highlights mismanagement of expectations or incomplete job descriptions. A low score can be better managed by providing a realistic job preview. This helps to present both the positive and negative aspects of the job to potential candidates, thus creating a more realistic view. 43 8. Applicants per opening Applicants per job opening or applicants per hire gauges the job‘s popularity. A large number of applicants could indicate a high demand for jobs in that particular area or a job description that‘s too broad. The number of applicants per opening is not necessarily an indicator of the number of suitable candidates. By narrowing the job description and including a number of ‗hard‘ criteria, the number of applicants can be reduced without reducing the number of suitable candidates. 9. Selection ratio The selection ratio refers to the number of hired candidates compared to the total number of candidates. This ratio is also called the Submittals to Hire Ratio. The selection ratio is very similar to the number of applicants per opening. When there‘s a high number of candidates, the ratio approaches 0. The selection ratio provides information such as the value of different assessment and recruitment tools and can be used to estimate the utility of a given selection and recruitment system.. 10. Cost per hire We could write a full article on cost per hire. The cost per hire recruitment metric is the total cost invested in hiring divided by the number of hires. Cost per hire consists of multiple cost structures which can be divided by internal and external cost. By quantifying all of them you can calculate the total recruitment cost. 11. Candidate experience When we talk about recruiting metrics, candidate experience shouldn‘t be overlooked. Candidate experience is the way that job seekers perceive an employer‘s recruitment and onboarding process, and is often measured using a candidate experience survey. 44 12. Offer acceptance rate The offer acceptance rate compares the number of candidates who successfully accepted a job offer with the number of candidates who received an offer. A low rate is indicative of potential compensation problems. When these problems occur often for certain functions, the pay can be discussed earlier in the recruiting process in an effort to minimize the impact of a refused job offer. An example is by listing pay in the job opening or by asking for the candidate‘s salary expectations. 13. % of open positions The % of open positions compared to the total number of positions can be applied to specific departments or to the entire organization even. A high percentage can be indicative of high demand (for example due to fast growth) or low labor market supply. 14. Application completion rate Application completion rate is especially interesting for organizations with elaborate online recruiting systems. Many large corporate firms require candidates to manually input their entire CV in their systems before they can apply for a job. Drop-out in this process is indicative of problems in this procedure, e.g. web browser incompatibility with the application system, or a non-user-friendly interface. 15. Recruitment funnel effectiveness Recruitment is a funnel which begins with sourcing and ends with a signed contract. By measuring the effectiveness of all the different steps in the funnel, you can specify a yield ratio per step. This makes for some excellent recruiting metrics. For example, 15:1 (750 applicants apply, 50 CVs are screened) 5:1 (50 screened CVs lead to 10 candidates submitted to the hiring manager) 2:1 (10 candidate submissions lead to 5 hiring manager acceptances) 5:2 (5 first interviews lead to 2 final interviews) 2:1 (2 final interviews lead to 1 offer) 1:1 (1 offer to 1 hire) 45 The recruiting funnel has changed a lot over the last few years due to advances in HR tech. The first few steps are often atomized: software helps to automatically screen CVs and select the best fits. Some companies opt to go for video interviews to change submittals and even first interviews. In other words: expect this funnel to change over time. 16. Sourcing channel effectiveness Sourcing channel effectiveness helps to measure the conversions per channel. By comparing the percentage of applications with the percentage of impressions of the positions, you can quickly judge the effectiveness of different channels. A simple way to do this is by using Google Analytics to track where the people who viewed the job opening on your website actually came from. By setting ‗goals‘, like the successful completion of an application form, this conversion rate can be made much more accurate. 17. Sourcing channel cost You can also calculate the cost efficiency of your different sourcing channels by including ad spend, the amount of money spent on advertisement, on those platforms. By dividing the ad spend with the number of visitors who successfully applied through the job opening you measure the sourcing channel cost per hire. 18. Cost of getting to Optimum Productivity Level (OPL) The cost of getting to Optimum Productivity Level (OPL) is the total cost involved in getting someone up to speed. This includes things like onboarding cost, training cost, the cost of supervisors and co-workers involved in on-the-job training, and more. Usually, a percentage of the employee‘s salary is also included in this calculation, until they hit 100% OPL. On top of this metric, there is also the ―logistical‖ cost of replacing an employee. These are also called the cost per hire. Research by Oxford Economics (2014) lists OPL cost in retail at £ 16,240 (approx. $ 20,200), in media £ 21,633 ($ 27,000), and in legal £ 35,307 ($ 44,000). 19. Time to productivity Time to productivity, or time to Optimum Productivity Level, measures how long it takes to get people up to speed and productive. It is the time between the first day of hiring and the point where the employee fully contributes to the organization. According to the same research by Oxford Economics, the average time a new employee takes to reach their OPL is 28 weeks. Employees from within the same industry usually take less, while employees from outside the industry take significant longer (32 weeks). University 46 graduates (40 weeks), school leavers (53 weeks) and unemployed (52 weeks) take the longest time. 3.4 Activities/Assessment ESSAY Test: 1. Explain briefly the advantages and disadvantages of various ways of eliminating a labor surplus and avoiding a labor shortage. ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ 2. Discuss the various recruitment policies that organizations adopt to make job vacancies more attractive. ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ 47 3. Identify the various sources of recruits, their advantages and disadvantages, and the methods for evaluating them. ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ 4. Explain the recruiter‘s role in the recruitment process, the limits the recruiter faces, and the opportunities available. ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ 48 5. Identify the 17 most relevant recruitment metrics, their usage and importance to effective and efficient recruitment activities. ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ 49 Lesson 4 Selection and Placement 4.1 Overview Any organization that intends to compete through people must take the utmost care with how it chooses organizational members. These decisions have a critical impact on the organization‘s ability to compete, as well as each and every job applicant‘s life. Organizations have to strive to make sure that the decisions they make with respect to who gets accepted or rejected for jobs promote the best interests of the company and are fair to all parties involved. The purpose of this chapter is to familiarize you with ways to minimize errors in employee selection and placement and, in doing so, improve your company‘s competitive position. The chapter first focuses on five standards that should be met by any selection method. The chapter then evaluates several common selection methods according to those standards. 4.2 Learning Outcomes At the end of this lesson, you should be able to: Establish the basic scientific properties of personnel selection methods, including reliability, validity, and generalizability. Discuss how the particular characteristics of a job, organization, or applicant affect the utility of any test. List the common methods used in selecting human resources. 4.3 Course Materials Topic 1: SELECTION METHOD STANDARDS Personnel selection is the process by which companies decide who will or will not be allowed into organizations. Several generic standards should be met in any selection process. We focus on five: (1) reliability, (2) validity, (3) generalizability, (4) utility, and (5) legality. RELIABILITY The consistency of a performance measure; the degree to which a performance measure is free from random error. Much of the work in personnel selection involves measuring characteristics of people to determine who will be accepted for job openings. For example, we might be interested in applicants‘ physical characteristics, their cognitive abilities, or aspects of their personality. 50 Estimating the Reliability of Measurement Most measurement in personnel selection deals with complex characteristics like intelligence, integrity, and leadership ability. However, to appreciate some of the complexities in measuring people, we will consider something concrete in discussing these concepts: the measurement of height. For example, if we were measuring an applicant‘s height, we might start by using a 12- inch ruler. Let‘s say an applicant we measure turns out to be 6 feet 1 and 4/16 inches tall. It would not be surprising to find out that someone else measuring the same person a second time, perhaps an hour later, found this applicant‘s height to be 6 feet and 12/16 inches. As this example makes clear, even though the person‘s height is a stable characteristic, we get slightly different results each time he is assessed. This means that each time the person is assessed, we must be making slight errors. We can estimate reliability in several different ways, however; and because most of these rely on computing a correlation coefficient, we will briefly describe and illustrate this statistic. The correlation coefficient is a measure of the degree to which two sets of numbers are related. The correlation coefficient expresses the strength of the relationship in numerical form. Standards for Reliability Regardless of what characteristic we are measuring, we want highly reliable measures. When it comes to measuring students‘ aptitudes for college, the SAT is more reliable than counselor ratings, which in turn are more reliable than tossing dice. But in an absolute sense, how high is high enough—.50,.70,.90? This is a difficult question to answer specifically because the required reliability depends in part on the nature of the decision being made about the people being measured No specific value of reliability is always acceptable, all else being equal, the more reliable a measure is, the better. VALIDITY We define validity as the extent to which performance on the measure is related to performance on the job. A measure must be reliable if it is to have any validity Criterion-Related Validation A method of establishing the validity of a personnel selection method by showing a substantial correlation between test scores and job-performance scores. Criterion-related validity studies come in two varieties. Predictive validation seeks to establish an empirical relationship between test scores taken prior to being hired and eventual performance on the job. Concurrent validation assesses the validity of a test by administering it to people already on the job and then correlating test scores with existing measures of each person‘s performance. Content Validation When sample sizes are small, an alternative test validation strategy, content validation, can be used. Content validation is performed by demonstrating that the items, questions, or problems posed by a test are a representative sample of the kinds of situations or problems that occur on the job. 51 The ability to use content validation in small sample settings makes it generally more applicable than criterion-related validation. However, content validation has two limitations. First, one assumption behind content validation is that the person who is to be hired must have the knowledge, skills, or abilities at the time she is hired. Second, because subjective judgment plays such a large role in content validation, it is critical to minimize the amount of inference involved on the part of judges. Thus the judges‘ ratings need to be made with respect to relatively concrete and observable behaviors. GENERALIZABILITY Generalizability is defined as the degree to which the validity of a selection method established in one context extends to other contexts. There are two primary ―contexts‖ over which we might like to generalize: different situations (jobs or organizations) and different samples of people. Just as reliability is necessary but not sufficient for validity, validity is necessary but not sufficient for generalizability Validity Generalization stands as an alternative for validating selection methods for companies that cannot employ criterion-related or content validation. Validity generalization is a three-step process. First, the company provides evidence from previous criterion-related validity studies conducted in other situations that shows that a specific test (such as a test of emotional stability) is a valid predictor for a specific job (like nurse at a large hospital). Second, the company provides evidence from job analysis to document that the job it is trying to fill (nurse at a small hospital) is similar in all major respects to the job validated elsewhere (nurse at a large hospital). Finally, if the company can show that it uses a test that is the same as or similar to that used in 52 the validated setting, then one can ―generalize‖ the validity from the first context (large hospital) to the new context (small hospital). UTILITY Utility is the degree to which the information provided by selection methods enhances the bottom-line effectiveness of the organization. In general, the more reliable, valid, and generalizable the selection method is, the more utility it will have. LEGALITYThe final standard that any selection method should adhere to is legality. All selection methods should conform to existing laws and existing legal precedents. Topic 2: TYPES OF SELECTION METHODS The first half of this chapter laid out the five standards by which we can judge selection measures. In the second half of this chapter, we examine the common selection methods used in various organizations and discuss their advantages and disadvantages in terms of these standards. INTERVIEWS A selection interview has been defined as ―a dialogue initiated by one or more persons to gather information and evaluate the qualifications of an applicant for process, as well as the opportunity for unconscious bias effects, often makes applicants upset, particularly if they fail to get a job after being asked apparently irrelevant questions. In the end, subjective selection methods like the interview must be validated by traditional criterion-related or content-validation procedures if they show any degree of adverse impact. Fortunately, more recent research has pointed to a number of concrete steps that one can employ to increase the utility of the personnel selection interview. First, HR staff should keep the interview structured, standardized, and focused on accomplishing a small number of goals. That is, they should plan to come out of each interview with quantitative ratings on a small number of dimensions that are observable and avoid ratings of abilities that may be better measured by tests. Second, interviewers should ask questions dealing with specific situations that are likely to arise on the job, and use these to determine what the person is likely to do in those situations. These types of situational interview items have been shown to have quite high predictive validity. 53 It is also important to use multiple interviewers who are trained to avoid many of the subjective errors that can result when one human being is asked to rate another. REFERENCES, APPLICATION BLANKS, AND BACKGROUND CHECKS Just as few employers would think of hiring someone without an interview, nearly all employers also use some method for getting background information on applicants before an interview. This information can be solicited from the people who know the candidate through reference checks. The evidence on the reliability and validity of reference checks suggests that these are, at best, weak predictors of future success on the job. The main reason for this low validity is that the evaluations supplied in most reference letters are so positive that it is hard to differentiate applicants. PHYSICAL ABILITY TESTS Although automation and other advances in technology have eliminated or modified many physically demanding occupational tasks, many jobs still require certain physical abilities or psychomotor abilities. In these cases, tests of physical abilities may be relevant not only to predicting performance but to predicting occupational injuries and disabilities as well. There are seven classes of tests in this area: ones that evaluate (1) muscular tension, (2) muscular power, (3) muscular endurance, (4) cardiovascular endurance, (5) flexibility, (6) balance, and (7) coordination. COGNITIVE ABILITY TESTS Cognitive ability tests differentiate individuals based on their mental rather than physical capacities. Cognitive ability has many different facets, although we will focus only on three dominant ones. Verbal comprehension refers to a person‘s capacity to understand and use written and spoken language. Quantitative ability concerns the speed and accuracy with which one can solve arithmetic problems of all kinds. Reasoning ability, a broader concept, refers to a person‘s capacity to invent solutions to many diverse problems. Some jobs require only one or two of these facets of cognitive ability. Under these conditions, maintaining the separation among the facets is appropriate. PERSONAL INVENTORIES While ability tests attempt to categorize individuals relative to what they can do, personality measures tend to categorize individuals by what they are like. 54 WORK SAMPLES Work-sample tests attempt to simulate the job in a pre-hiring context to observe how the applicant performs in the simulated job. The degree of fidelity in work samples can vary greatly. In some cases, applicants respond to a set of standardized hypothetical case studies and role play how they would react to certain situations. Often these standardized role plays employ interactive video technology to create ―virtual job auditions.‖ Simulations involving video-based role-plays seem to be more engaging and display higher levels of predictive validity relative to paper-and-pencil approaches. In other cases, the job applicants are brought to the employers‘ location and actually perform the job for a short time period as part of a ―job tryout.‖ HONESTY TESTS AND DRUG TESTS Many problems that confront society also exist within organizations, which has led to two new kinds of tests: honesty tests and drug-use tests. Many companies formerly employed polygraph tests, or lie detectors, to evaluate job applicants, but this changed with the passage of the Polygraph Act in 1988. This act banned the use of polygraphs in employment screening for most organizations. However, it did not eliminate the problem of theft by employees. As a result, the paper-and-pencil honesty testing industry was born. Paper-and-pencil honesty tests come in a number of different forms. Some directly emphasize questions dealing with past theft admissions or associations with people who stole from employers. 4.1 Activites/Assessment: ESSAY WRITING: 1. Discuss the scientific properties of personnel selection methods, including reliability, validity, and generalizability. __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ 55 2. Discuss how the particular characteristics of a job, organization, or applicant affect the utility of any test. __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ 3. Identify the common methods used in selecting human resources. __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ 56 Lesson 5: Training 5.1 Overview There is both a direct and an indirect link between training and business strategy and goals. Training can help employees develop skills needed to perform their jobs, which directly affects the business. Giving employees opportunities to learn and develop creates a positive work environment, which supports the business strategy by attracting talented employees as well as motivating and retaining current employees. Why do many other companies believe that an investment in training can help them gain a competitive advantage? Training can Increase employees‘ knowledge of foreign competitors and cultures, which is critical for success in foreign markets. Help ensure that employees have the basic skills to work with new technology, such as robots and computer-assisted manufacturing processes. Help employees understand how to work effectively in teams to contribute to product and service quality. Ensure that the company‘s culture emphasizes innovation, creativity, and learning. Ensure employment security by providing new ways for employees to contribute to the company when their jobs change, their interests change, or their skills become obsolete. Prepare employees to accept and work more effectively with each other, particularly with minorities and women. In this lesson, we emphasize the conditions through which training practices can help companies gain competitive advantage and how managers can contribute to effective training and other learning initiatives 5.2 Learning Outcomes At the end of this lesson, you should be able to: Explain the role of the manager in identifying training needs and supporting training on the job. Determine the steps in conducting needs assessment Evaluate employees‘ readiness for training Discuss the strengths and weaknesses of presentation, hands-on, and group training methods Explain the potential advantages of e-learning for training. Design a training session to maximize learning 57 5.3 Course Materials TOPIC 1: Designing Effective Formal Training Activities A key characteristic of training activities that contribute to competitiveness is that they are designed according to the instructional design process. Training design process refers to a systematic approach for developing training programs. Instructional System Design (ISD) and the ADDIE model (analysis, design, development, implementation, and evaluation) are two specific types of training design processes you may know. Stage 1 is to assess needs to determine if training is needed. Stage 2 involves ensuring employees have the readiness for training, and they have the motivation and basic skills to master training content. Stage 3 addresses whether the training session (or the learning environment) has the factors necessary for learning to occur. Stage 4 is to ensure that trainees 58 apply the content of training to their jobs. This requires support from managers and peers for the use of training content on the job as well as getting the employee to understand how to take personal responsibility for skill improvement. Stage 5 involves choosing a training method. The training design process should be systematic yet flexible enough to adapt to business needs. Different steps may be completed simultaneously. Also feedback from each stage in the training progress can be useful for the other stages. NEEDS ASSESSMENT The first step in the instructional design process, needs assessment, refers to the process used to determine if training is necessary. Figure 7.3 shows the causes and outcomes resulting from needs assessment. As we see, many different ―pressure points‖ suggest that training is necessary. These pressure points include performance problems, new technology, internal or external customer requests for training, job redesign, new legislation, changes in customer preferences, new products, or employees‘ lack of basic skills as well as support for the company‘s business strategy (e.g., growth, global business expansion). Needs assessment typically involves organizational analysis, person analysis, and task analysis.14 Organizational analysis considers the context in which training will occur. That is, Organizational Analysis involves determining the business appropriateness of training, given the company‘s business strategy, its resources available for training, and support by managers and peers for training activities. Person analysis helps identify who needs training. Person Analysis involves (1) determining whether performance deficiencies result from a lack of knowledge, skill, or ability (a training issue) or from a motivational or work-design problem; (2) identifying who needs training; and (3) determining employees‘ readiness for training. Task Analysis includes identifying the important tasks and knowledge, skills, and behaviors that need to be emphasized in training for employees to complete their tasks. 59 ORGANIZATIONAL ANALYSIS Three factors need to be considered before choosing training as the solution to any pressure point: (1) the support of managers and peers for training activities, (2) the company‘s strategy, and (3) the training resources available. Support of Managers and Peers Various studies have found that peer and manager support for training is critical. The key factors to success are a positive attitude among peers and managers about participation in training activities; managers‘ and peers‘ willingness to tell trainees how they can more effectively use knowledge, skills, or behaviors learned in training on the job; and the availability of opportunities for the trainees to use training content in their jobs. If peers‘ and managers‘ attitudes and behaviors are not supportive, employees are not likely to apply training content to their jobs. Company Strategy Table 7.1 shows possible strategic initiatives and their implications for training practices. It is important to identify the prevailing business strategy and goals to ensure that the company allocates enough of its budget to training, that employees receive training on relevant topics, and that employees get the right amount of training. 60 Training Resources It is necessary to identify whether the company has the budget, time, and expertise for training. Table 7.2 provides examples of questions to ask vendors and consultants to help evaluate whether they can meet the company‘s training needs. PERSON ANALYSIS Person analysis helps the manager identify whether training is appropriate and which employees need training. In certain situations, such as the introduction of a new technology or service, all employees may need training. However, when managers, customers, or employees identify a problem (usually as a result of a performance deficiency), it is often unclear whether training is the solution. A major pressure point for training is poor or substandard performance—that is, a gap between employees‘ current performance and their expected performance. Poor performance is indicated by customer complaints, low performance ratings, or on-the-job accidents or unsafe behavior. From a manager‘s perspective, to determine if training is needed, for any performance problem you need to analyze characteristics of the performer, input, output, consequences, and feedback. How might this be done? You should ask several questions to determine if training is the likely solution to a performance problem. TASK ANALYSIS A task analysis, which we defined earlier in the chapter, identifies the conditions in which tasks are performed. The conditions include identifying equipment and the environment the employee works in, time constraints (deadlines), safety considerations, or performance standards, A job is a specific position requiring the completion of specific tasks. A task is a statement of an employee‘s work activity in a specific job. 61 ENSURING EMPLOYEES’ READINESS FOR TRAINING The second step in the training design process is to evaluate whether employees are ready for training. Readiness for Training refers to employee characteristics that provide employees with the desire, energy, and focus necessary to learn from training. The desire of the trainee to learn the content of a training program is referred as motivation to learn. Motivation to learn influences mastery of all types of training content, including knowledge, behavior, and skills. Managers need to ensure that employees‘ motivation to learn is as high as possible. CREATING A LEARNING ENVIRONMENT Learning permanently changes behavior. For employees to acquire knowledge and skills in the training program and apply this information in their jobs, the training program must include specific learning principles. Educational and industrial psychologists and instructional design specialists have identified several conditions under which employees learn best. ENSURING TRANSFER OF TRAINING Transfer of training refers to on-the-job use of knowledge, skills, and behaviors learned in training. If no learning occurs in the training program, transfer is unlikely. Manager Support Manager support refers to the degree to which trainees‘ managers (1) emphasize the importance of attending training programs and (2) stress the application of training content to the job. 62 An action plan is a written document that includes the steps that the trainee and manager will take to ensure that training transfers to the job. The action plan includes (1) a goal identifying what training content will be used and how it will be used (project, problem); (2) strategies for reaching the goal, including resources needed; (3) strategies for getting feedback (such as meetings with the manager); and (4) expected outcome (what will be different?). The action plan includes a schedule of specific dates and times when the manager and trainee agree to meet to discuss the progress being made in using learned capabilities on the job. Peer Support Transfer of training can also be enhanced by creating a support network among the trainees. A support network is a group of two or more trainees who agree to meet and discuss their progress in using learned capabilities on the job. This could involve face-to-face meetings or communications via e-mail, Twitter, or other social networking tools. Trainees can share successful experiences in using training content on the job; they can also discuss how they obtained resources needed to use training content or how they coped with a work environment that interfered with use of training content. Opportunity to Use Learned Capabilities Opportunity to use learned capabilities (opportunity to perform) refers to the extent to which the trainee is provided with or actively seeks experience with newly learned knowledge, skill, and behaviors from the training program. Opportunity to perform is influenced by both the work environment and trainee motivation. Technological Support: Performance Support and Knowledge Management Systems Performance support systems are computer applications that can provide, as requested, skills training, information access, and expert advice. Performance support may be used to enhance transfer of training by giving trainees an electronic information source that they can refer to as needed as they attempt to apply learned capabilities on the job. Knowledge management systems often include Communities of Practice. Communities of practice are groups of employees who work together, learn from each other, and develop a common understanding of how to get work accomplished. Self-Management Skills Training programs should prepare employees to self-manage their use of new skills and behaviors on the job. Specifically, within the training program, trainees should set goals for using skills or behaviors on the job, identify conditions under which they might fail to use them, identify the positive and negative consequences of using them, and monitor their use of them. Also, trainees need to understand that it is natural to encounter difficulty in trying to use skills on the job; relapses into old behavior and skill patterns do not indicate that trainees should give up. Finally, because peers and supervisors on the job may be unable to reward trainees using new behaviors or to provide feedback automatically, trainees need to create their own reward system and ask peers and managers for feedback. Similarly, if employees do learn, transfer of training will not occur if the work environment does not support or actively discourages applying what was learned. 63 SELECTING TRAINING METHODS A number of different methods can help employees acquire new knowledge, skills, and behaviors. Figure 7.5 provides an overview of the use of training methods across all size companies. The instructor-led classroom still remains the most frequently used training method. However, it is important to note that the use of online learning, mobile learning, social learning, and use of blended learning, i.e., a combination of approaches, for training continues to increase. Expectations are that this trend with continue. Presentation Methods Presentation methods refer to methods in which trainees are passive recipients of information. Presentation methods include traditional classroom instruction, distance learning, and audiovisual training. They can include the use of personal computers, smartphones, and tablet computers such as iPads. Instructor-Led Classroom Instruction. Classroom instruction typically involves having the trainer lecture a group. In many cases the lecture is supplemented with question and-answer periods, discussion, or case studies. Traditional classroom instruction is one of the least expensive, least time consuming ways to present information on a specific topic to many trainees. Distance learning is used by geographically dispersed companies to provide information about new products, policies, or procedures as well as skills training and expert lectures to field locations. Distance learning features two-way communications between people. First, it can include teleconferencing. Teleconferencing refers to synchronous exchange of audio, video, and/or text between two or more individuals or groups at two or more locations. Second, distance learning can include a virtual classroom. A third type of distance learning also includes individualized, personal-computer– based training. Employees participate in training 64 anywhere they have access to a personal computer. This can also include Webcasting, which involves face-to-face instruction provided online through live broadcasts. The major disadvantage of distance learning is the potential for lack of interaction between the trainer and the audience. To help ensure distance learning is effective, a high degree of interaction between trainees and the trainer is necessary. That‘s why establishing a communications link between employees and the trainer is important. Also, on-site instructors or facilitators should be available to answer questions and moderate question-and-answer sessions. Audiovisual Training. Audiovisual training includes overheads, slides, and video. It has been used for improving communications skills, interviewing skills, and customer service skills and for illustrating how procedures (such as welding) should be followed. Video is, however, rarely used alone. Learners may not be required to attend a class. They can work independently, using materials in workbooks, DVDs, or on the Internet. Hands-On Methods Hands-on methods are training methods that require the trainee to be actively involved in learning. Hands-on methods include on-the-job training, simulations, business games and case studies, behavior modeling, interactive video, and web-based training. ON-THE-JOB TRAINING (OJT) Peers or managers training new or inexperienced employees who learn the job by observation, understanding, and imitation. Apprenticeship is a work-study training method with both on-the-job training and classroom training. Apprenticeships can be sponsored by individual companies or by groups of companies cooperating with a union. The majority of apprenticeship programs are in the skilled trades, such as plumbing, carpentry, electrical work, and bricklaying One disadvantage of apprenticeship programs is that there is no guarantee that jobs will be available when the program is completed. Another disadvantage is that employers may not hire apprentices because they believe apprentices are narrowly trained in one occupation or with one company, and program graduates may have only company specific skills and may be unable to acquire new skills or adapt their skills to changes in the workplace. An Internship is on-the-job learning sponsored by an educational institution or is part of an academic program. Students are placed in paid positions where they can gain experiences related to their area of study. Simulations. A simulation is a training method that represents a real-life situation, with trainees‘ decisions resulting in outcomes that mirror what would happen if the trainee were on the job. Simulations, which allow trainees to see the impact of their decisions in an artificial, risk- free environment, are used to teach production and process skills as well as management and interpersonal skills. Simulations are used for training pilots, cable installers, and call center employees. Avatars refer to computer depictions of humans that are being used as imaginary coaches, co- workers, and customers in simulations. Typically, trainees see the avatar who appears throughout the training course. 65 A way to enhance simulations is through Virtual Reality. Virtual Reality is a computer-based technology that provides trainees with a three-dimensional learning experience. Using specialized equipment or viewing the virtual model on the computer screen, trainees move through the simulated environment and interact with its components. Technology is used to stimulate multiple senses of the trainee. Business Games and Case Studies. Situations that trainees study and discuss (case studies) and business games in which trainees must gather information, analyze it, and make decisions are used primarily for management skill development. Behavior Modeling. Research suggests that behavior modeling is one of the most effective techniques for teaching interpersonal skills. Each training session, which typically lasts four hours, focuses on one interpersonal skill, such as coaching or communicating ideas. E-Learning. E-Learning, computer-based training (CBT), online learning, and web-based training refer to instruction and delivery of training by computer through the Internet or the web. Online learning, e-learning, and web-based training all include delivery of instruction using the Internet or web. The training program can be accessed using a password through the public Internet or the company‘s private intranet. Effective e-learning is grounded on a thorough needs assessment and complete learning objectives. Repurposing refers to directly translating an instructor-led, face-to-face training program online. Massive open online courses (MOOCs) are a new type of e-learning. Massive Open Online Courses (MOOCs) is online learning designed to enroll large numbers of learners who have access to the Internet, and composed of interactive coursework including video lectures, discussion groups, wikis, and assessment quizzes. Social Media. Social media refer to online and mobile technology used to create interactive communications allowing the creation and exchange of user-generated content. Blended Learning. Because of the limitations of e-learning related to technology, because of trainee preference for face-to-face contact with instructors and other learners. Blended learning refers to combining technology methods, such as e-learning or social media, with face- to-face instruction, for delivery of learning content and instruction. Learning Management System. Learning Management System (LMS) refers to a Technology platform that automates the administration, development, and delivery of a company‘s training program. Group- or Team-Building Methods Group- or Team Building Methods Training are techniques that help trainees share ideas and experiences, build group identity, understand the dynamics of interpersonal relationships, and get to know their own strengths and weaknesses and those of their co-workers. Experiential Programs. Experiential programs are training programs in which trainees gain knowledge and theory, participate in behavioral simulations, analyze the activity, and connect the theory and activity with on-the-job situations. Adventure learning, a type of experiential program, develops teamwork and leadership skills using structured outdoor activities. Adventure learning appears to be best suited for developing 66 skills related to group effectiveness, such as self-awareness, problem solving, conflict management, and risk taking. Team Training. Team training coordinates the performance of individuals who work together to achieve a common goal. Such training is an important issue when information must be shared and individuals affect the overall performance of the group. Team training strategies include cross-training and coordination training. Cross-Training, team members understand and practice each other‘s skills. Coordination Training, trains the team in how to share information and decisions. Team leader training refers to training the team manager or facilitator. This may involve training the manager how to resolve conflict within the team or help the team coordinate activities or other team skills. Action Learning. In Action Learning teams or work groups get an actual business problem, work on solving it and commit to an action plan, and are accountable for carrying out the plan. Typically, action learning involves between 6 and 30 employees; it may also include customers and vendors. Action learning is often part of quality improvement processes such as Six Sigma training and Kaizen. Kaizen, the Japanese word for improvement, Practices participated in by employees from all levels of the company that focus on continuous improvement of business processes. TOPIC 2: Advice for Choosing a Training Method Given the large number of training methods available to you, this task may seem difficult. One way to choose a training method is to compare methods. The first step in choosing a method is to identify the type of learning outcome that you want training to influence. These outcomes include verbal information, intellectual skills, cognitive strategies, attitudes, motor skills, or some combination. Training methods may influence one or several learning outcomes. Second, comparing the presentation methods to the hands-on methods illustrates that most hands-on methods provide a better learning environment and transfer of training than do the presentation methods. A final but important consideration is the training budget. If you have a limited budget for developing new training methods, use structured on-the-job training—a relatively inexpensive yet effective hands-on method. If you have a larger budget, you might want to consider hands- on methods that facilitate transfer of training, such as simulators. EVALUATING TRAINING PROGRAMS Training evaluation can provide useful information including the program‘s strengths and weaknesses, identifying which learners benefited most and least from participating, determining the program‘s financial benefits and costs, and allowing the comparison of the benefits and costs of different programs. 67 Examining the outcomes of a program helps in evaluating its effectiveness. These outcomes should be related to the program objectives, which help trainees understand the purpose of the program. Training Outcomes can be categorized as cognitive outcomes, skill-based outcomes, affective outcomes, results, and return on investment. Which training outcomes measure is best? The answer depends on the training objectives. Evaluation Designs As shown in Table 7.8, a number of different evaluation designs can be applied to training programs. In general, designs that use pre-training and post-training measures of outcomes and include a comparison group reduce the risk that factors other than training itself are responsible for the 68 evaluation results. This builds confidence to use the results to make decisions. Many companies are interested in determining the financial benefits of learning, including training courses and programs and development activities. One way to do this is by determining Return on Investment (ROI). Return on Investment (ROI) refers to the estimated dollar return from each dollar invested in learning. Determining the Financial Benefits of Learning To make an ROI analysis follow these steps: 1. Identify outcomes (e.g., quality, accidents). 2. Place a value on the outcomes. 3. Determine the change in performance after eliminating other potential influences on training results. 4. Obtain an annual amount of benefits (operational results) from training by comparing results after training to results before training (in dollars). 5. Determine the training costs (direct costs + indirect costs + development costs + overhead costs + compensation for trainees). 6. Calculate the total savings by subtracting the training costs from benefits (operational results). 7. Calculate the ROI by dividing benefits (operational results) by costs. The ROI gives an estimate of the dollar return expected from each dollar invested in training. TOPIC 3: Special Training Issues To meet the competitive challenges of sustainability, globalization, and technology, companies must successfully deal with several special training issues. The special training issues include preparing employees to work in different cultures abroad, managing workforce diversity, and socializing and orienting new employees. CROSS-CULTURAL PREPARATION Companies today are challenged to expand globally. Because of the increase in global operations, employees often work outside their country of origin or work with employees from other countries. An Expatriate works in a country other than his or her country of origin. The most frequently selected locations for expatriate assignments include the United States, China, Africa, and India. Cross-Cultural Preparation is the process of educating employees (and their families) who are given an assignment in a foreign country Steps in Cross-Cultural Preparation To succeed overseas, expatriates (employees on foreign assignments) need to be: 1. Competent in their areas of expertise. 2. Able to communicate verbally and nonverbally in the host country. 3. Flexible, tolerant of ambiguity, and sensitive to cultural differences. 4. Motivated to succeed, able to enjoy the challenge of working in other countries, and willing to learn about the host country‘s culture, language, and customs. 69 5. Supported by their families. Predeparture Phase Before departure, employees need to receive language training and an orientation to the new country‘s culture and customs. It is critical that the family be included in orientation programs. Expatriates and their families need information about housing, schools, recreation, shopping, and health care facilities in the areas where they will live. Cross-cultural training methods include presentational techniques, such as lectures that expatriates and their families attend on the customs and culture of the host country, immersion experiences, or actual experiences in the home country in culturally diverse communities. On-Site Phase On-site training involves continued orientation to the host country and its customs and cultures through formal programs or through a mentoring relationship. Expatriates should be encouraged to develop social relationships both inside and outside of the workplace. Repatriation Phase Repatriation prepares expatriates for return to the parent company and country from the foreign assignment. Expatriates and their families are likely to experience high levels of stress and anxiety when they return because of the changes that have occurred since their departure. MANAGING WORKFORCE DIVERSITY AND INCLUSION Diversity can be considered any dimension that differentiates a person from another. 70 Inclusion refers to creating an environment in which employees share a sense of belonging, mutual respect, and commitment from others. Inclusion allows companies to capitalize not only on the diversity of their employees but also on their customers, suppliers, and community partners. Diversity Training refers to learning efforts that are designed to change employee attitudes about diversity and or/develop skills needed to work with a diverse workforce. Managing Diversity And Inclusion involves creating an environment that allows all employees to contribute to organizational goals and experience personal growth. This environment includes access to jobs as well as fair and positive treatment of all employees. TOPIC 4: Onboarding and Socialization Onboarding, or socialization, refers to the process of helping new hires adjust to social and performance aspects of their new jobs. This is important to help employees adjust to their jobs by establishing relationships to increase satisfaction, clarifying goals and expectations to improve performance, and providing feedback, coaching, and follow-up activities to reduce turnover. Effective onboarding does include understanding mundane tasks such as completing tax forms and knowing how to complete time sheets or travel reimbursement forms. Table 7.10 shows the characteristics of effective onboarding programs. Effective onboarding programs actively involve the new employee. 71 5.4 Activities/Assessment ESSAY TEST: 1. Briefly explain the role of the manager in identifying training needs and supporting training on the job. ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ________________________________________________________________ 2. Determine the steps in conducting needs assessment. Briefly explain each. ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ 72 ______________________________________________________________________ _______________________________________________________________