Recruitment and Selection Strategies in Employee Retention - Essay Example

Reading Header: The Role of Recruitment and Selection Strategies in Supporting Employee Retention within a Complex International Labour Market of student: Student number: Lecturer: Course: Date: The Role of Recruitment and Selection Strategies in Supporting Employee Retention within a Complex International Labour Market Introduction Hiring and retaining good employees has always been a major challenge for many firms. The complexity of the international job market invariably amplifies the dilemma faced by the recruitment managers. The criteria and recruitment strategy employed is therefore crucial to ensuring the retention of employees in the fickle international job market. Even with the current global economic crisis, employer surveys still consistently cite employee retention is there main concern. According to Workman (2008), a majority of these international job assignments are terminated by the employees prematurely even before their tour of duty is concluded as per the terms of their contracts. This is more perplexing when we consider the generous remuneration packages enjoyed by the expatriates. Similarly some of the vocations are curtailed by employees in spite of the rigorous recruitment procedures undertaken to harness the right candidates. So where are the recruiters going wrong in the hiring process? The effectiveness of the recruitment exercise has also come under intense scrutiny due to the relatively high cost of replacing absconding staff. Workman (2008) cites adapting to the host or foreign culture as the main reason individuals resign from the lucrative international assignments. Many married employees usually desire to educate their children in their home country rather than in the host country. This is evident even when they are in more developed cultures than their own domestic country. In developing countries like the Middle East oil producing nations, expatriates schools are provided for the foreign nationals complete with international curriculum for their children. However most of the families are reluctant to bring up their children in this environment. Other privileges are provided whenever cultural norms clash with those of the host country nevertheless; the turnover is still high despite the efforts of the international companies to retain them. Adaptability to foreign cultures is therefore a major challenge for international assignment. Curry (2004) however decries lack of an intensive recruitment screening exercise as the main reason to having a high employee turnover in both national and international organizations. Just as individuals carefully screen their spouses before marriage, Curry asserts that companies should similarly thoroughly vet their employees prior to hiring them to minimize the losses incurred in recruiting, employing and training fresh employees. McNamara (2008) conversely cites the lack of proper motivation as the major reason employees leave their current employment. He refers to the common myths associated with employee satisfaction which many employers still maintain as sufficient motivation to retain their key employees, this include money as a good incentive, a nice office, and job security among others. International Recruitment Strategy Due to the nature and the unpredictability of international job assignments, many companies hiring expatriates now demand a meticulous selection criterion to weed out the individuals that they deem unable to withstand the rigors of international assignments. The main decisive factors include the individual’s adaptableness – this entail whether the prospective employee is capable of adapting to the cultural shock experience in the host country. Employers are very keen on this aspect as it is the main decisive criteria which determine whether the potential candidate will last long if faced by a hash climate, different language, religion, lack of social life, or differing dietary habits. Although some candidates may be highly qualified with some technical skills and willing to take the overseas job, a lack of flexibility may spell doom for the career abroad. Recruiters consequently critically question an individual by spelling out the difficulties that may be encountered in the overseas job rather than the normal recruitment initiative of dwelling on the advantages of the employment. Candidates are made aware of the host country’s cultural norms as well as the company’s expectations which the employee must agree to before commencement of the exercise. The recruiters also question the potential employee’s motivation or incentive in undertaking the job. Individuals who are merely attracted by the adventure of the foreign job often get quickly disillusioned when the romance of the foreign job quickly dissipates due to a cultural shock as the lack of the familiar amenities; friends, family, and other ‘normal’ features make the individual homesick eventually leading to abandonment of the career. Recruiters therefore search for solid individuals who are either motivated by financial incentives and have prior international experience or have stayed abroad. Employees who have previously had successful stints abroad are more likely to provide a solid employment criteria rather than fresh graduates who are merely driven by adventure. Similarly individuals who have multicultural backgrounds are generally better oriented towards adapting to other cultures. Recent immigrants are also capable of assimilating radical changes in culture due to their backgrounds. Descendants of migrant families are also keen to experience their ancestral homes and may already be conversant with the local language. Other attributes that recruiters look for are educational and training background that pertains to the job requirements. Individuals who are not suited for the technicality of the job will be more challenged by the international experienced coupled by their lack of training. However Workman (2008) argues that younger recruits or fresh graduates tend to adapt more rapidly to the foreign experience as compared to the older trained individuals. This is due to the relative lower expectations of the younger employee when compared to the more mature employee who has too may expectations for the job. Age is therefore another criteria used by recruiters to discern the right candidates. Older employees with families are more likely to abscond from the employment due to the pull of their families. In cases where employees migrate with their families to the host country, the older employee with teenage children is more resistant to change due to the teenagers missing their friends back home. Younger employees however quickly adapt to the new experience even when they have young children. Recruiters are nevertheless more likely to opt for individuals who are unmarried or have no teenage children due to their flexibility. Although cultural attributes form the main criterion in the scrutiny of potential employees, recruiters are also very keen to discern the leadership capabilities of the employee especially those earmarked for managerial postings. The challenge of international assignments require individuals who are capable of taking challenging positions due to the remoteness of the postings hence individual acumen is required to make snap decisions without reference to the home office. Similarly foreign assignments usually mean an individual is given charge of foreign nationals who may not take kindly to what they might construe as an imposition of an expatriate while overlooking local talent. The employee must therefore have leadership skills to overcome the initial hostility from the local employees while engaging their cooperation within the organisation. Finally the recruiter must undertake a thorough vetting of the potential employee physical and mental health through a current medical check-up as well as doing a background checks to minimise potential health problems in foreign locations. The individual capability to withstand different climates is also verified to reduce a calamitous debacle in the international assignment. Individuals who have a history of medical health problems are therefore eliminated even if currently healthy or highly qualified. Selection Tools and Selection Criteria Hodgetts and Luthans (2006) have formulated a number of categories attributable to individuals who are likely to undertake international employment. This include: career employees who are committed to their jobs and want to further advance their occupation; employees who are not married or single due to their lack of familial attachments; childless couples or those without teenage children are more likely to take kindly to international assignments; individuals who have had previous international experience and have enjoyed the lucrative terms or perks due to international postings. This individuals will be more likely to take the international jobs than others who maybe apprehensive of the foreign assignments. Due to the expenses involved in relocating an individual employee in the foreign posts, many companies usually require the selected employee to initially serve in the home office to test the capability of the individual. Many companies however provide adjustment tools for the selected employees before they embark on the international postings. These include seminars and workshops which encompass an employee’s ability to withstand high pressure in host country, adjustments to organizational culture, family adjustment among others. According to Workman (2008) multinationals test an employee’s adaptability skills through a number of methods which include: the ability to resolve setbacks within diverse structures and angles. The employee is assigned tasks which must be effectively completed to the satisfaction of the management. Another adaptability skill test is the ability of the employee to detect and correctly appraise developments in the posted country. The employee is tested by a partial posting in a foreign country before the actual full posting takes place. The employee is also tested for their understanding and appreciation of different cultures, religious inclinations, political leanings and moral obligation. This ascertains the employee’s sense of impartiality when in foreign locations to avoid conflicting with the local communities as it may lead to a backlash on the company. Similarly the employee is made aware of adapting to the required or expected cultural or religious sensitivities of the host country. Lastly the employee is tested for the ability to be flexible in matters of decision making as pertains making independent decisions. Role of Recruitment Strategy vis-à-vis Employee Retention According to Shilling (2003) the costs of a high turnover of staff can be established by a number of factors. This include: the cost of hiring temporary or substitute staff which is evident on diminished productivity; the toll on the remaining workers who must worker extra hard to cover up on the duties of the departing employee. This cost is in terms of paying for the extra hours worked or in the diminished quality of the output; the cost of training new employees to fill up the posts of the exiting staff; the exit interview process and processing of the termination benefits; the loss of the employee’s expertise and referrals; cost of the company’s unemployment insurance due to departures; recruitment expenses in terms of advertisements or use of recruitment agencies. UK’s Chartered Institute Of Personnel and Development (CIPD) has formulated a turnover rate index which incorporates all staff leaving the organization including involuntary or dismissals, redundancy, or retirement.. Total number of leavers over period x 100 Average total number employed over period However the CIPD has established a stability index which indicates the retention rate of experienced employees: Number of leavers with more than one years service x 100 Total number of staff in post one year ago The CIPD has also established its listings of the replacement costs for the departing employee which can be multiplied by the above crude turnover rate for the employees to calculate the annual costs of the departures. The main categories according to CIPD are: administration or processing the eventual benefits of the departing employee, the expenses incurred to hire a new employee, the expenses due to covering or keeping the business running in the vacancy period, and the training costs of the new employee. Due to the high cost attributed to recruiting and relocating employees internationally and even domestically, many companies are abandoning traditional methods of retaining employees. This particularly evident in the highly sensitive functions or business units which can paralyze the company when key staff resign or are poached by the opposition (Bevan, Barber, & Robinson, 1997). The recruitment of the right employees is therefore crucial to weed out the restless individuals who are prone to job changes and overtures from rivals. The challenge of the recruitment team is discerning the employee who has a staying power but is also highly performing. International recruitment may also call for employers to recruit from the host country or employing local nationals to avoid the cost of restless employees from their home country unable to adapt to the foreign culture. Campbell (2004) stated, ‘Hire the right people in the first place. Find people who are looking for the characteristics of your work culture, whether its fast-paced, lay back, structured or fluid. A good fit makes for a happy and valued employee who is less inclined to leave.’(Campbell, 2004, p. 3). Companies are therefore obliged to avoid undue expenses mostly incurred due to the recruitment of unstable employees. This is especially important in the international arena where the expenses will be appreciably higher due to the logistical and other adjustments costs involved. Curry (2004) asserts that poor recruitment methods not only impacts on the company’s expenses, but also on the customers. This is in turn reflected on poorer sales as result of lost customer royalty as well is the attendant costing of replacing the disengaging staff. The recruitment exercise must also face the challenge of hiring the right employee to guarantee continuity of the company’s brand name as hiring the wrong staff might escalate the problem further. Curry therefore affirms the adage, ‘find the right people to start with…getting the right people into your company to start with gets things moving in the right direction at the very beginning(Curry, 2004, p. 1). This means that the often declared preposition that the customer comes first is erroneous as the employee must be there to attract the customer hence cannot preclude either. The recruitment strategy must also be aimed at attracting the best talents in the field. Attracting the best employee must however go beyond the usual attachment package of benefits and perks but to the other seemingly imperceptible factors that eventually play a greater role in a company’s employee turnover. This involves treating the employee as humanly as possible from a mere employee to an associate hence generating respect which trickles down to the customer who will get better service. The employer is therefore called upon to be flexible in matters of employee relations like: dressing, working hours or schedule, medical benefits among others. The recruitment managers will need to put forth this benefits to the potential candidates who will most likely be attracted by the flexible employer and retain a royalty to the company due to its flexibility. Employee royalty is crucial to retaining employees and recruiters must also scrutinize the employee resumes to find out whether they are fickle employees or why they left other employers. The University of Colorado - HR Guide to Motivating Employees indicates, ‘ flexible work schedules (flex schedules) provide a powerful tool for management that can be used to fulfil business needs, accommodate a changing workforce, assist with recruitment and retention, and help employees achieve a better work-life balance.’(CU-Boulder, 2008, p. 10) Curry (2004) singles out hiring ‘nice people’. She disapproves of the customary recruiters obsession with individual’s driven by success as most likely to ‘jump the ship’ once they sight other seemingly more beneficial terms with another employer. Nice people according to Curry are humble and not fanatical about success that are down to earth and generate employee royalty. (Rosenbluth & Peters, 2004) advocate for a recruitment strategy which uses unconventional interview methods rather than usual panel conference assemblage. This involves combining the traditional formal interview with other informal interviews like engaging the potential employee in an impromptu setting like a team game. This provides a setting for assessing the candidate reaction to a competitive atmosphere whereby the personality or altitude is discerned from. Another test may be to take the candidate on a test drive which assesses the individual’s reaction on the road, aggressiveness, irritation, etc. Rosenbluth & Peters, (2004) assert that, ‘chances are that their performance on the … field will reflect their performance in the office’ (pg. 31-32). Kaye & Jordan-Evans (2002) have listed the top reasons employee retain royalty to their current employers. These include: professional development; tutoring and growth; stimulating occupation and challenge; significant job; distinctive contribution; employee relations; teamwork; leadership; recognition; enjoyment; independence at work; remuneration; job environment; job security; captivating friendly employer; modern work systems and technology. Employees who enjoy flexible rather than the normal traditional rigid work schedules were more likely to be motivated. This was exemplified as Johnson & Johnson whereby workers who enjoyed flexible work schedules and family outings averaged a whooping 50 percent lower non-attendance when compared to the entire company staff. Similarly at Xerox, workers were allowed to control their own work schedules which had the impact of enhanced employee motivation, improved customer service, and the more noteworthy 30 percent less non-attendance for the staff (Harrington., 1997). The University of Colorado - HR Guide to Motivating Employees (2008) advocates nine major practises that enhance staff morale and hence ensure employee retention and royalty. This include: saying ‘Thank You’ or appreciating an employee who has put in extra effort rather than waiting to criticise on any mistakes committed. Secondly is meeting and listing to employee grievances; developing a flexible work schedules; allowing employees to provide constructive feedback on business ideas; using the life style inventory TM (LSI) and organisational culture inventory (OCI) tools available at the Organizational and Employee Development (OED) – this concept help employees appreciate their own self; having a system of awarding employees within their own departments; nominating staff for achievements; encouraging staff participation in the company activities; and generating staff ideas lists which include a no-cost idea list and a low-cost idea list(CU-Boulder, 2008). Hard and Soft Approaches to Human Resources Management Staff benefits need not necessarily be rigidly structured or costly to the company to impact positively on the employees. Some low-cost ideas or no-cost ideas can have a far more profound impact on the workers who will consequently generate a royalty to their appreciative employer. Among the no-cost ideas advocated by University of Colorado - HR Guide to Motivating Employees (2008) include: congratulatory note to an employee in writing; writing to their family outlining their accomplishments; nominating them for award, special projects, and mentoring program; paid leave to attend training courses; celebratory outings or meals; posting inspirational messages at the company’s message boards; request other employee ideas. Among the low-cost ideas by CU-Boulder (2008) include: erecting a bulletin board for staff commendation, snacks; celebrations of accomplishments; departmental award schemes; presents; pictorials of the high achiever; complimentary vouchers; and awarded with seminars or training.(CU-Boulder, 2008). All this are soft perks that greatly enhance an employee’s attachment t the organisation which are further elucidated by Campbell (2004) in her article Eleven Low-Cost Ideas for Retaining Employees. According to Shellenbarger (2000), ‘employees who dont feel that they are respected or trusted, or who dont feel that the company cares about them, are much more likely to quit’(Shellenbarger, 2000, p. B1). Holoviak (2004) likewise advocates for non-traditional recruitment procedures which include: employ from the right perspective; involvement of staff in the vision of the organisation and what it encompass; practising primary statutes of leadership; engaging staff in business ideas; and having appreciable perks and benefits. Stern (2001) however suggests using a formal system is more effective than an informal structure of pampering employees. He advocates for a mentoring system whereby new workers are indoctrinated unto the company ideas and workings by other senior experienced staff. This enables them to get faster acclimatisation within the company and a successful career. This tactic is referred as a hard approach that uses the traditional method as advocated by conventional management strategists. Drizin (2009) also disparages the over-reliance on employee retention as the yardstick of the proper recruitment and managerial structures. He refers to the Walker Informations 1999 and 2001 national employee studies which highlight low turnover of staff among government employees or the nursing profession but who also depicts statistics of lower job satisfaction. Thus he asserts, ‘that high worker retention does not equal high employee loyalty’ and low turnover will not necessarily generate more quality service (Drizin, 2009). The international labour market is dominated by highly skilled personnel who usually seek challenging international jobs that are not only rewarding but also offer challenges to the individual. These employees similarly desire to work in organisations that are highly motivated rather than the staid rigid firms that are conservative and distrust maverick employees. According to studies conducted by Towers Perrin and the National Association of Colleges and Employers (NACE) in 2000, top performers’ strife for: challenges; job transformation; prospects for development within the organization; suitable remuneration packages; and independence or minimal micro-managing (IPM, 2000). Due to the fickle nature of expatriate staff, to obtain the more dependable highly motivated employees, employers are obliged to focus on individuals whose desire not only the rewarding high salaries or benefits but also ready to face the challenge of working in a virgin environment. This means the employee is more motivated by the duties entailed rather than the perks. The professional ‘technical’ employee is also offered benefits which were traditionally the preserve of the top management which include flexible work schedules, training funds, fitness centres, laundry, and recreational benefits among others (Magos, 2008). The onus of retaining a company’s employees is on the management of the company who must enact measures that are aimed at creating employee royalty among the staff. Watsonville, a California based Construction Company has managed to retain its employees by employing measures that ensure a binding employee royalty, thereby enjoying only a nine percent voluntary turnover rate. The company which has an international network sets aside 3.7 percent pre-tax of its profits for staff bonuses and incentives for lower-ranking staff amounting to over $4 million to 900 employees (Dunphy, 2006). Shilling (2003) has emphasized that ‘recruitment and retention, and the way we disseminate our company culture, is not the sole province of HR, but a key responsibility of all managers in the corporation.’(Shilling, 2003, p. 1) The task of recruiting and selection the appropriate employees within the composite international market is compounded by the nature of individuals to be perpetually drawn back to their original homes. To recruit and retain good employees in a foreign setting therefore requires a careful scrutiny of the potential candidates to eliminate the inevitable costly turnovers. The selected employees must be highly motivated with little inclination to desert their posting due to incidence of cultural shock and lack of normal amenities, and loss of social life. The employer on the other hand must cultivate an amicable conducive environment for the employees including provision of commensurate benefits and perks as well as a rewarding and non-formal work environment. The recruitment criteria will ensure the weeding out of candidates who are prone to homesickness even in cases of enviable academic or technical qualifications. Factors like language, experience, and marital status, age, and health aspects must be greatly considered before verifying other technical qualifications. This can help minimise a high turnover of staff and hence save in the consequent recruitment expenses. Bibliography Bevan S, & Barber L, & Robinson D. (1997) Keeping the Best: A Practical Guide to Retaining Key Employees. London: Report 337, Institute for Employment Studies. Campbell, Kelle. (2004) Eleven Low-Cost Ideas for Retaining Employees. National Federation of Independent Business. Cohen, Allan and David Bradford. (1990) Influence without Authority: A New Way to Get Things Done at Work. John Wiley & Sons. Collins, Jim. (2001) Good to Great: Why Some Companies Make the Leap and Others Don t. HarperCollins. CU-Boulder. (2008) HR Guide to Motivating Employees. 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(2008) Multinational Screening, Selection Criteria and Adjustment Tools. International Job Assignments: 1-3. Read More