1. A report distinguishing between traditional personnel management and the new approach to human resource management, outlining their historical development.
2. The Human Resource department in TD Travel Group. Its role and purpose in the organization.
Task 2
1. An analysis of the objectives and the process of human resource planning.
2. An evaluation of the systematic approach to recruitment for NIS Europe.
3. An investigation of the selection procedures used for NIS Europe and TD Travel Group.
3. Evaluation and Conclusion
4. Bibliography
Task 1
TASK 2
AN ANALYSIS OF THE OBJECTIVES AND THE PROCESS OF HUMAN RESOURCE PLANNING.
Human resource planning is the task of assessing and anticipating the skill, knowledge and labour time requirements of the organisation and initiating action to fulfill those requirements.
Human resource planning involves a strategy for the:
* Recruitment
* Retention
* Utilisation
* Improvement, and
* Disposal
of the human resources of a business. It needs to look at the following factors:
* What are the skills and abilities of the current workforce?
* What skills and abilities the organisation needs in the future?
* Where can the organisation find its future supply of labour?
* What are the future objectives of the business likely to be?
* How will the business manage and obtain its human resources to meet these objectives?
In order to plan Human Resources effectively a business has to undertake considerable research.
Here is a table showing the things companies have consider when planning human resources:
What is happening now?
* Organisational Objectives
* Analysis of staff numbers and age
* Wage rates
* Work loads
* Key skills
* Labour turnover
* Absenteeism
What do we expect to happen to the demand for products / services and therefore labour?
* Changing technology
* Sales forecasts
* Market research
* New product development
* Managerial skills
* Wage Rates
* Union Agreements
What do we expect labour supply to be like in the future?
* Local unemployment / employment trends
* Local skills and availability
* Demographic changes
* Legislation
* Government training schemes
* Quality of local education, housing and transport
* Competition for workers
All these issues raise questions, which the human resource plan should cover.
The plan should include:
* Organisation development
* Training and management development
* Recruitment, redundancy and redeployment
* Appraisal and job evaluation
* Promotion prospects
Human Resource Planning (HRM) is a form of risk management. It involves realistically appraising the present and anticipating the future (as far as possible) in order to get the right people into the right jobs at the right time.
This may seem simple at first, short of staff – hire some new staff, too many staff – make redundancies. Unfortunately its not that simple anymore and that is why human resource planning is necessary.
Why Human Resource Planning is necessary:
It is increasingly important to look beyond the present and short-term future to be able to prepare for contingencies. This will help to exercise control over as many variables as possible, which influence the success and failure of a business.
For example, for highly skilled or specialised jobs, it will be more difficult to find replacement staff with the right skills quickly, therefore the need for new staff will have to be anticipated in advance to give enough time for extra training to be given without leaving the company short staffed and unable to provide an efficient service. For example, in the travel industry, reservation staff need to be fully trained on the computer reservation system (CRS) and have a full understanding of fares and ticketing, otherwise there would be a minimum of a six month training period, which would leave the business vulnerable and unable to provide good quality service
Redundancies are not as easy to make anymore. It is a much slower more costly experience, not only in financial terms but also in loss of reputation as a secure employer. This in itself may make it harder to recruit labour when required.
Rapid technological change is leading to a requirement for manpower, which is both more highly skilled and adaptable. Labour flexibility is a major issue, which means that the career and retraining potential of staff are at least as important as their actual qualifications and skills. They must be assessed in advance of requirements. In the selection process trainability is one of the most popular innovations of the HRM era of personnel management.
The UK still suffers from particular skill shortages, despite high unemployment levels, for example nurses at Macclesfield Hospital, 20 nurses from the Philippines have had to be employed, as there was a shortage of suitably skilled staff in the UK.
The scope and variety of markets, competition and labour resources are continually increased by political and economic moves such as the unification of Germany, the opening of Eastern Europe and continuing progress towards European Union.
Computer technology has made available techniques which facilitate the monitoring and planning of manpower over fairly long time spans: manipulation of manpower statistics, trend analysis, modeling and so on.
THE PROCESS OF HRP
There are three main factors in HRP:
* Forecasting Demand
* Forecasting Supply
* Closing the gap between demand and supply
FORCASTING DEMAND
The Demand for labour must be forecast by considering several factors:
The objectives of an organisation – Organisations will normally devise a strategic plan, which will set out its objectives. This will be the responsibility of the directors who will devise their plan after discussion with the most senior managers. In some cases the directors of companies may decide to change the strategy of the business completely. This could involve getting rid of the senior managers and replacing them with a new managerial team, which can put the new strategy into place more efficiently. This happened both at British Airways and at Tesco’s where it was decided that a complete change of image was needed to improve profits. Most of the top management were replaced and in both cases the strategy was successful. This sort of strategy will obviously affect the demand for labour in general and / or for particular skills.
Manpower utilisation – how much labour will be required given the expected productivity or work rate of different types of employee’s and the expected volume of business activity. Productivity will depend on capital expenditure, technology, work organisation, employee motivation and skills, negotiated productivity deals and many other factors.
The cost of Labour – including overtime, training and other incentives, and therefore what financial constraints there are on the organisations manpower levels.
Environmental factors – trends in technology and markets that will require organisational change, because of threats or opportunities. The recession in the 90’s created conditions in which expectations of labour demand in the short term were low: downsizing of staffs and delayering of organisation structures were the trend.
FORCASTING SUPPLY
The available supply of labour will be forecast by considering the following factors:
* The skill base, potential trainability and current and potential productivity level of the existing workforce
* The structure of the existing workforce e.g. age distribution, skills, hours of work, rates of pay etc
The likelihood of changes to the productivity, size and structure of the workforce, caused by, wastage (turnover by resignation and retirement), promotions and transfers, absenteeism and other staff movements; this will require information on:
* The age structure of staff (forthcoming retirement or family start-up)
* Labour turnover for a comparable period
* Promotion potential and ambitions of staff
Other causes of changes in productivity are employee trainability and motivation, which may increase productivity and flexibility. Organisational, technological and cultural changes are factors, which may affect employee productivity and loyalty.
The present and potential future supplies of skilled labour in the environment – that is, the external labour market. The HR planner will have to assess and monitor factors such as:
* Skill availability, locally, nationally and internationally (e.g. within the EU)
* Changes to skill availability due to education and training initiatives (or lack of these)
* Competitor activity which may absorb more or less of the available skill pool
* Demographic changes – areas of population growth and decline, the proportion of younger / older people in the workforce in a particular region, the number of women in a workforce etc.
* Wage and salary rates in the market for particular jobs
CLOSING THE GAP BETWEEN DEMAND AND SUPPLY
A deficiency of labour may be met by:
* Internal transfers and promotions, training and development
* External recruitment or improvement to recruitment methods
* Extension of temporary contracts, or contracts of those about to retire
* Reducing labour turnover by reviewing possible causes (e.g. pay and benefits) and improving induction and socialisation
* The use of freelance / temporary / agency staff
* The development of flexible working methods and structures
* Encouraging overtime working
* Productivity bargaining to increase productivity
* Automation (increasing productivity, and / or reducing the need for human labour)
A surplus of labour may be met by:
* Running down manning levels by natural / accelerated wastage
* Restricting or freezing recruitment
* Redundancies (voluntary and/or compulsory)
* Early retirement incentives
* A tougher stance on discipline, enabling more dismissals
* Part time and short contract working, or job sharing
* Eliminating overtime and peripheral workforce groups
* Redeployment of staff to areas of labour shortage. This may necessitate diversification by the organisation, to find new work for the labour force, and/or plans for multi-skilling, so that the workforce can be flexibly deployed in areas of labour shortage as and when they emerge.
There are also external constraints on HR planners when considering any of the above such as, UK legislation and EU directives, regulations and court rulings, the employer brand or reputation and other factors must be taken into account when planning to hire, ‘fire’ or alter working terms and conditions.
Labour turnover is the number of employees leaving an organisation and being replaced. The rate of turnover is often expressed as the number of people leaving as a percentage of the average number of people employed, in a given period of time. The term natural wastage is used to describe a normal flow of people out of an organisation through retirement, career or job change, relocation etc.
AN EVALUATION OF THE SYSTEMATIC APPROACH TO RECRUITMENT AT NIS EUROPE.
Recruitment is the phase, which immediately precedes selection. Its purpose is to pave the way for selection procedures by producing, ideally the smallest number of candidates who appear to be capable either of performing the required tasks of the job from the outset, or of developing the ability to do so within a period of time acceptable to the employing organisation.
The main point that needs to be made about the recruitment task is that the employing organisation should not waste time and money examining the credentials of the people whose qualifications do not match the requirements of the job. A primary task of the recruitment phase is to help would-be applicants to decide whether they are likely to be suitable to fill the job vacancy. This is clearly in the interest of both the employing organisation and the applicants.
The current approach to recruitment within NIS Europe works in six stages.
Stage One – Determining the vacancies
Human resources would confirm what resources are needed and determine as to whether or not they wanted to fill the vacancy. This very much depends on the aim and objectives of NIS Europe.
Stage Two – Considering the sources internally and externally
If appropriate they would advertise the vacancy internally, or think of possible transfers.
HR within NIS always gives this very careful consideration and where possible favour’s this option first for the following reasons: –
* Existing employees are know to the organisation and are generally familiar with its customs and practices
* The cost and time that recruitment, selection and induction procedures consume can be significantly reduced
* Internal recruitment may be used as a means of career development, widening opportunities and stimulating motivation amongst existing employees
If the vacancy were not filled internally then they would look to external sources. Dependent on the vacancy this would be via one of the two main means: –
* Through employment agencies – governmental, institutional and private commercial
* Advertisements in newspapers and journals
Stage Four -Preparing and publishing information
NIS Europe feels that this aspect of the recruitment process requires very special attention and skill. It is their objective to publish information, which fulfils the following conditions:
* It is succinct and yet gives a comprehensive and accurate description of the job and its requirements
* It is likely to attract the attention of the maximum number of potentially suitable candidates
* It gives a favourable image of the organisation in terms of efficiency and its attitude towards people
* It does not contravene employment laws concerning sex and racial discrimination
Along with the submission of curriculum vitae, NIS Europe standard procedure is for each applicant to submit a NIS Europe application form. This falls in line with equal opportunities and allows NIS to obtain standard information about the applicant, that on a curriculum vita may be omitted. See appendix for job advert and application form.
Stage Five – Processing and assessing applications
When all the applicants have been received by the due date, the next task is to select those applicants who, on the evidence available, appear to be the most suitable as future employees of NIS Europe and therefore, worth the time and cost of further examination in the selection procedures. The screening process is based on the published requirements for the job. It involves a scrupulous study of the information provided by the applicants, a comparison of this information with the job requirements, and then a final decision as to whether to accept or reject the applicant at this stage.
Stage Six – Notifying applicants
Once the selection process from the applicants has taken place, the final step is to notify the chosen applicants of the arrangements for the selection procedures, and the rejected applicants that they have not been chosen. The letter to the successful applicants will have full details about the arrangements for the selection procedures, i.e. time and place. NIS Europe ensures that all letters informing applicants of the result of applications are sent as soon as possible.
THE EVALUATION OF THE SYSTEMATIC APPROACH FOR NAVIGANT INTEGRATED SERVICES EUROPE
Below is an evaluation of the recruitment procedure for Navigant Integrated Services (NIS). The aim of this evaluation is to determine whether NIS recruitment procedures succeed in getting a suitable person for the job advertised and at an acceptable cost.
The methods for auditing the recruitment process follow these performance indicators: –
Total numbers of applicants received:
Dependent on the type of vacancy NIS Europe can expect to receive on average around a dozen applicants for an advertised job vacancy. They have recently advertised for an accounts co-ordinator and have received over 30 applicants. They have admitted by not stating the salary this has interested applications, covering a wide range of experience, or in some cases very little experience.
Time taken to locate applicants:
Most vacancies within NIS are usually filled within one month of the advert being placed.
Cost per applicant:
NIS calculates �1000.00 per applicant, including the initial training.
Time taken to process applications:
NIS normally processes their applications within one week.
Number of female /minority/ disabled applicants:
NIS does not meet this indicator. They predominantly employ females; they have one minority employee and no disabled employees. When this was discussed with our HR department they advised this was nothing discriminate. The travel industry is known as being a female dominated environment and there have never been any disabled applicants at NIS. If there were any disabled or other minority applicants, they would go through the same process, as other applicants and no preferential treatment would be given.
Number of qualified applicants:
90% of applicants are qualified for the job advertised. NIS biggest employment is of reservation staff for the travel industry. If they obtain a new account they will need to recruit fairly quickly, training is costly and time consuming so it is important that they stipulate qualified applicants only, at the advert stage, which is why they have a good success rate in finding candidates quickly for the vacancy advertised.
Number of qualified female/minority/disabled applicants:
About 70% of our applicants are female and qualified. NIS has very few minority or disabled applicants applying.
Cost effectiveness of the recruitment methods:
Dependent on the type of job will determine where NIS Europe advertises for staff. If they are looking for reservation agents they would normally get in touch with one of the industries recruitment agency’s. Most staff within the industry registers with the agencies. Many years ago jobs were advertised in industry papers the trend now leans towards recruitment agencies. Dependent on the level of salary the agencies take a percentage. For example on a salary of 17,000 they would take 10% of the gross salary. As the salary increases so does the percentage. Although working with an agency can work out costly, they do have a majority of the qualified personnel on their database and therefore gives NIS access to qualified personnel straight away.
Monitoring the make-up of the workforce:
NIS Europe workforce is split into the following departments and the make up of the workforce is as follows: –
Reservations – within the Travel, Hotel & Conference reservations department, NIS employs 60 staff in this department, 10% of the workforce is male, 88.33% are female, none are disabled and only one staff member is a minority employee.
* Sales and Marketing – NIS employs eight staff in this department, 37.5% of the workforce is male and 62.5% are female. None are disabled or minority employees.
* Accounts – NIS employs four staff in the department, 25% are male and 75% are female. None are disabled or minority employees
* HR – NIS employs two staff in this department, 100% are female. None are disabled or minority employees.
* IT – NIS employs five staff in this department, 100% are male. None are disabled or minority employees.
* Top line management – The top line management of NIS is made up of four. 25% is female and 75% are male. None are disabled or minority.
From the above information it is evident that there are three groups of employees that are underrepresented at NIS Europe, male, disabled and minority.
Attitude Surveys:
Once you under taken employment with NIS Europe, they do not require you to fill in an attitude survey asking you if you were satisfied with the stages of recruitment and selection process.
AN INVESTIGATION OF THE SELECTION PROCEDURES USED AT NIS EUROPE AND TD TRAVEL GROUP.
Selection is the part of the employee resourcing process, which follows on from recruitment. It essentially involves the identifying of the most suitable of the potential employees attracted to the organisation by recruitment efforts.
The crucial importance of selecting people who can meet the requirements described in the job description and person specification hardly need to be stressed. It is equally evident that mistakes in selection can have very serious consequences for corporate effectiveness. Such mistakes may adversely affect colleagues, subordinates and clients. Employee incompetence may lead to costly mistakes, loss and waste of valuable resources, accidents and avoidable expenditure on training.
Employee selectors face an inevitable dilemma. They have to carry out a vitally important task, but one that at the same time is fraught with problems to which there are either no answers or no easy answers. The abiding problem is the dependence on subjective human judgment. We must take into consideration, that fallible human beings devise so-called objective lists. For example some person specifications require certain attitudes and attributes, such as conscientious or able to stand pressure, how can the selectors identify these requirements in a person whom they do not know during the short acquaintance of the selection process.
In view of the importance and difficulties of the task, employers need to take selection most seriously. Appropriate investment at this stage can and will be cost-effective if it avoids the possibly enormous and incalculable cost that faulty employee selection may produce. For example, NIS Europe recently employed an operations manager through a recruitment agency, within six weeks of employment it was evident to NIS that he was not capable of the job he had been employed to do. Therefore NIS had to terminate his employment at a cost to the company of approximately �8,000.
Other errors of the selection process could include lack of skill or experience of interviewers, stereotyping by the interviewer in the absence of more detailed information and incorrect assessment of qualitative factors such as motivation, honesty or integrity.
Various selection methods are used to try to reduce the risks by gathering as much relevant information about the candidate as possible.
Currently NIS Europe is working with UMIST on a competencies project where NIS is contacting their client base to investigate in terms of service, what their expectations of NIS Europe are. The information collated in turn will then be translated into competencies and then used in the selection process.
Following on from our earlier systematic approach to recruitment is the systematic approach to selection Point five & six of the systematic approach to recruitment overlaps with the first & second point of the Systematic approach to selection.
Stage One – Processing and assessing applications
When all the applicants have been received by the due date, the next task is to select those applicants who, on the evidence available, appear to be the most suitable as future employees of NIS Europe and TD Travel Group and therefore, worth the time and cost of further examination in the selection procedures. The screening process is based on the published requirements for the job. It involves a scrupulous study of the information provided by the applicants, a comparison of this information with the job requirements, and then a final decision as to whether to accept or reject the applicant at this stage.
Stage Two – Notifying applicants
Once the selection process from the applicants has taken place, the final step is to notify the chosen applicants of the arrangements for the selection procedures, and the rejected applicants that they have not been chosen. The letter to the successful applicants will have full details about the arrangements for the selection procedures, i.e. time and place. NIS Europe ensures that all letters informing applicants of the result of applications are sent as soon as possible. TD Travel Group operates a very informal selection procedure. If the curriculum vitae are up to standard the applicant will be called for an interview, nothing will be advised on paper, arrangements are made on the telephone. If the curriculum vitae do not have the correct qualifications for the job it will be discarded straight away and no call to advise the applicant will be made.
Stage Three – Possible interviewees
“Possibles” will then be more closely scrutinised, and a short-list for interviews drawn up. Ideally this should be done by the HR specialist and the perspective manager of the successful candidate, who will have a more immediate knowledge of the type of person that will fit into the culture and activities of his department. In TD Travel Group’s case, John Owen (the operations Director) would be solely responsible for this stage, as there is no human resources department employed. At NIS Europe Barbara Sutton (Human Resources Director) and the line manager of the relevant department would be jointly responsible.
Stage Four- Inviting candidates from the short list for interviews
At this stage the company would require successful candidates to complete a standardised application form if not already submitted at the outset. NIS Europe standard procedure is for each applicant to submit a NIS Europe application form along with the curriculum vitae at the first stage for applying for the job. See appendix for application form. This falls in line with equal opportunities and allows NIS to obtain standard information about the applicant, that from a curriculum vita may be omitted. TD Travel Group have no standard information that is required and work off the submission of a curriculum vitae only.
Stage five – Interview potentially qualified candidates.
Since the interview is likely to continue to play a major role in the selection process, it seems sensible to adopt a realistic approach, which means making the best possible use of the interview. There are many different types of interview including:
* One-to-one interviews – these are the most common selection method. They offer the advantages of direct face-to-face communication, and opportunity to establish rapport between the candidate and interviewer. Each has to give attention solely to the other and there is potentially a relaxed atmosphere, if the interviewer is willing to establish an informal style.
* Panel Interviews – A panel may consist of two or three people who together interview a single candidate, most commonly, a personnel manager and the departmental manager who will have responsibility for the successful candidate.
NIS Europe use the above forms of interview, however they also have other interviewing techniques, which can be panel interviews or one to one interviews, such as:
* Audition interview – this is predominantly to assess people in leisure and service industries; it focuses on personality versus skill. This would involve exercises, which display the personality of the candidate as well as the skills.
* Criteria based interview – these are specific questions which highlight predetermined behavior which you are looking for e.g. if you need an outgoing person you would ask a question “If somebody came into the room how would you put them at ease?” You would rate the response as positive or negative.
* Behavioral event interview – ideally this interview is a taped interview. The interviewer would have a competence list on a chart and when questions asked and in turn answered, the competencies would be marked off.
TD Travel has a much more informal interview technique. It is generally a panel interview conducted by the Operations Director with the General manager and also the Sales and Marketing Director. There are no set techniques; it is more of a formal chat about skills and qualifications, outlined on the curriculum vitae.
Stage six – Selection testing
Once the interview has taken place, some companies go one step further by inviting candidates for a selection test. These tests are all standardised so that an individuals score can be related to others, reliable in that it always measures the same thing and is non discriminatory. These can be in various forms:
* Intelligence or cognitive testing – these test memory, ability to think quickly, perceptual speed, verbal fluency and problem solving skills. See appendix.
* Aptitude tests – these are designed to predict an individuals potential for performing a job or learning new skills.
* Personality tests – these may measure a variety of characteristics such as the applicant’s skill in dealing with other people, ambition, motivation or emotional stability. See appendix.
* Proficiency tests – these measure the ability of the applicant to do the work involved e.g. a typist would be asked to type, and a salesperson would be asked to sell.
Td Travel does not use selection tests at all. Most people are employed through word of mouth, as travel is a very incestuous business. NIS Europe use personality and aptitude tests.
Stage seven – Checking references of short listed candidates
References provide further confidential information about the perspective employee. A reference should contain:
* Straightforward factual information confirming the nature of the applicant’s previous jobs, previous employment, pay and circumstances of leaving
* Opinions about the applicant’s personality and other attributes.
At least two employer references are desirable, providing necessary factual information, and comparison of personal views. NIS Europe and TD Travel Group offer the successful candidate the job subject to checking the references.
Stage eight -Institute follow-up procedures for successful applicants
The follow up procedures include:
* Offer of employment – Assuming that the right candidate has by now been identified, an offer of employment can be made. It is common for an oral offer to be made. With a negociated period for consideration and acceptance.
* Draw up a contract or written particulars – this should include all terms, conditions and circumstances of the offer must be clearly stated and negotiable aspects of the offer and timetable for acceptance should be set out, in order to control the closing stages of the process
* Arrange work permits if required – Work permits are required of people coming into the UK for employment
* Plan induction – Induction is a formal programme, designed and carried out by HRM to introduce new employees to the organisation, in all its social as well as work aspects.
Stage nine- Review all candidates
Review un-interviewed candidates and sort out those that my be kept on file for possible future use. Send standard letters to unsuccessful to applicants and holding letters to those being kept on file. NIS Europe will hold candidates on file for a maximum of one year. TD Travel group do not use this procedure, they would start their informal recruitment process again as and when required.
SUMMARY OF THE SELECTION PROCESS FOR TD TRAVEL GROUP AND NIS EUROPE
It is evident from the above information that NIS Europe carries out a more formal selection procedure than TD Travel Group. This is down to the fact that NIS Europe have more employees than TD Travel Group, and therefore see it necessary to have a HR department.
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