sources of candidates for organizations both inside and outside the organization.

Here you see a picture of the recruitment and selection process. The process begins

by determining the positions that have to be filled through personnel planning and forecasting.

Next, the organization must identify qualified candidates through recruitment of candidates

within and outside the company. These candidates then undergo the selection process which may

include such things as interviews and background checks. Once the selection process is complete

then the company reviews the candidates and makes an offer.

In today's topic, recruitment, we will cover the first 3 boxes shown here. The rest of

the diagram will be covered in the next chapter.

Personnel planning is the process of deciding what positions the firm will have to fill

and how to fill them. A specific form of personnel planning is called succession planning. Here

organizations are looking at, and planning for, how they can best replace top management

positions if and when the need arises.

A key issue in planning is forecasting the overall personnel needs of the organization.

Here one is trying to estimate the size of the staff needed to meet the organization's

goal. There are two main types of forecasting: trend

analysis and ratio analysis. Trend analysis uses previous employment figures to predict

future need. A ratio analysis focuses on the ratio of some causal factor, like sales volume,

and the number of employees required. So, if the organization wants to increase the

sales volume by 5%, how many more salespeople do we need to add to achieve this?

Here is a graphical representation of forecasting. The hospital has previous data on the number

of nurses needed based on the number of beds they have in the hospital. Based on this chart

you can see the relationship between the number of beds and the number of nurses needed to

care for the patients in those beds. From this data we can forecast the number of nurses

we will need as the hospital continues to grow.

Once you have determined how many positions are available, you need to decide if you can

staff these open positions from within. To make this decision the organization must know

the knowledge, skills, and abilities of their employees. Organizations can use qualification

inventories which are manual or computerized records listing employees' education, career

and development interests, language, special skills, etc. They can go one step further

and create personnel replacement charts that show the present performance and promotability

for each position's potential replacement.

Here is an example of a replacement chart for a top management position. As you can

see there are three people that are next in line for the promotion but some are more qualified

than others. For example, if the Division Vice President were to resign today then Jones

is the only one who is qualified to take over the job immediately. The other two possibilities

still need further development or are not promotable.

Information like this can be very helpful for organizations in planning for things like

retirement or in reacting quickly to an unforeseen resignation. It is interesting to note that

there are computer programs that help organizations maintain information on their employees and

help them construct these types of replacement charts. These are known as Human Resource

Information Systems and can be used to track the qualifications of hundreds or even thousands

of employees.

Many organizations cannot survive without hiring externally, thus, companies must also

try to determine the supply of qualified individuals outside the organization. There are two major

determinants companies can use. First is the expected unemployment rate. When the unemployment

rate is low it means that few people are out of a job. This translates to fewer people

to fill vacant positions. In response, an organization will have to increase their recruitment

strategies in order to fill any of their open positions. However, if the employment rate

is up then there are lots of people looking for jobs and in some cases, the company can

sit back and watch the applications roll in. The second most common way businesses forecast

the supply of external candidates is looking at the availability of qualified people in

specific occupations such as nursing or information technology.