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CHAPTER 5 Recruitment in a Global Workplace

Mukta Kulkarni and Mathian Osicki

The only thing worth more than a bright new idea is a bright new hire.

– NAKACHE, 1997

Attracting human resources to an organization not only determines the future composition of the organization’s workforce, but also the long-term ability of the organization to meet its strategic goals. A good recruitment procedure can function as a sieve, to filter people from the available talent pool. Attracting the right candidate is important not only in booming markets where organizations compete intensely for scarce talent, but also in recessionary markets where organizations have to sift through a large number of applicants who are vying for relatively fewer jobs.

An Employment Management Association report indicates that, on average, organizations spend $1,000 recruiting a nonexempt employee, about $7,000 for an exempt employee, and over $23,000 for executive-level employees in the external labor market. Recruiting efforts therefore have to be targeted toward attracting the right candidate, not only given financial implications, but also because they feed into consequent selection processes. If recruiting strategies don’t help identify a sizable and suitable pool of talent, even the most accurate selection process will be of little or no use (Fisher, Schoenfeldt, & Shaw, 2006).

Despite the importance of the recruiting function, a recent survey of 50 CEOs of global organizations paints a grim picture. This survey indicates that even for top management-level recruitment, strategies are ad hoc, vague, and heavily reliant on subjective evaluations. The consequence is that about a third of new hires leave after three years of being with the organization. What is more surprising is the fact that most CEOs do not see the situation as it is (Fernández-Araoz, Groysberg, & Nohria, 2009). Suboptimal recruitment, and the consequent unavoidable suboptimal hiring, especially at strategic levels and for key positions, can cause serious financial setbacks for an organization or, worse, ruin it. Sometimes organizations search too narrowly and try to find candidates from within their own network, only to realize too late that their decision was flawed (Fernández-Araoz, 2007). Indeed, a study by the Center for Creative Leadership shows that one out of four executives selected is the only one considered (Fernández-Araoz, Groysberg, & Nohria, 2009). This may well have been the case with appointing Jill Barad at the helm of Mattel, or Douglas Ivestor at the helm of Coca-Cola. Both were asked to leave after about two and a half years (Charan & Colvin, 2000; Morris, et al., 2004). Could the organizational stories have been different had they cast a wider net and attracted and sifted through other candidates?

Importance of Casting a Wide Recruiting Net

Traditionally, organizations could scan their local environments for a relevant supply of talent and be reasonably satisfied with the results. Today though, given uneven employment growth (International Labour Organization, 2009), globalization, and competition, organizations have to broaden their scan to include international environments (Schuler & Tarique, 2007). For example, given increased technological sophistication and opening up of markets, companies like Dell, Sony, Apple, Zara, Nike, to name a few, have had to develop a global talent pool and conduct recruiting globally to service expanding markets (Dessler, 2008). To make matters more complicated for organizations, much of the global talent pool now lies outside of the United States and Europe. Thirty-three million young professionals now live in 28 low-wage countries (Despeignes, 2005), and this talent is not uniform in availability. India and China, for example, were predicted to face serious skilled labor shortages by the end of 2009 (Farrell & Grant, 2005; NASSCOM, 2006). Further, available skill sets and numbers do not match organizational requirements in certain parts of the developing or growth economies (Guthridge, Komm, & Lawson, 2008; International Labour Organization, 2009), especially for managerial positions (Ready, Hill, & Conger, 2008).

Given the global nature of business today, organizations have to create very specific and effective recruitment efforts to build a deep reservoir of global as well as local talent to staff all their organizational levels (Guthridge, Komm, & Lawson, 2008). To address these challenges, global organizations such as Procter & Gamble have mapped a global supply-chain process to obtain talent. At the country leader level at Procter & Gamble, for example, there are about 300 executives who come from 36 countries, and 50% are from outside the United States. The top 40 executives of Procter & Gamble come from 12 different nations, and 45% are from outside the United States (Ready & Conger, 2007).

Consider also the example of Renault-Nissan. In 1999, the top brass of Nissan, then in financial trouble, decided to partner with Renault and chose a non-Japanese COO from Renault to transform the organization. The COO was Carlos Ghosn, a Brazilborn French-Lebanese businessman. It was a bold decision for the Japanese company, which usually recruited only Japanese executives, and one that transformed the ailing company into a successful one (Millikin & Fu, 2005).

It is not only large or multinational for-profit organizations that have to cast a large recruiting net to leverage the globally dispersed talent and overcome regional skill scarcity. Consider the involved and successful recruiting strategy followed by Sinai hospital in Baltimore, Maryland. This not-for-profit health care organization reaches out to nurses in the Philippines, spends time explaining their mission and work, and, after determining a fit, invites them to join their campus. This strategy has helped them tremendously in meeting talent demands. These examples demonstrate how casting a wide recruiting net can effectively fill a void that a narrower one may not address.

Scope and Outline of the Chapter

In this chapter, we draw upon recruitment research and organizational examples to outline various contingencies that managers should consider when undertaking recruitment initiatives, and offer specific recommendations for recruiting effectively in the global workplace. We define recruiting as a process of finding and attracting the right candidates and encouraging them to apply for certain positions (Bohlander & Snell, 2004; Dessler, 2008). Given our scope, we do not detail internal versus external sources of recruitment, content and delivery of recruitment messages, effects of recruiter characteristics, or timing of recruitment initiatives. Comprehensive summaries and reviews on these topics can be found elsewhere (for example, see Barber, 1998; Bohlander & Snell, 2004; Breaugh, 2008; Dessler, 2008).

The chapter is structured as follows. First we discuss the notion that various contingencies have the potential to influence recruiting strategies, and how organizations have to be aware of these contingencies. In the next section we specifically elaborate on external as well as internal contingencies that have an impact on recruiting. In each section we draw upon research and organizational examples to identify key lessons and recommendations for managers. The chapter is broadly summarized in Table 5.1 .

Contingencies to Consider When Recruiting

Organizations function within an external societal and global context as well as an internal organizational context. Both these exogenous and endogenous contexts serve as contingencies that influence human resources practices in general and recruitment in particular. Key exogenous or external contingency factors include the legal, societal or cultural, political, and labor market contexts. Key endogenous or internal contingency factors include the size, age, technology, and structure of an organization (Jackson & Schuler, 1995). To deal with both kinds of contingencies, global organizations typically follow one of three approaches in terms of their human resource practices: They adjust practices to reflect local institutional conditions; they follow common practices regardless of which country they are operating in; or they create some form of a blend to reflect a combinational of local and headquarter practices (Brewster, Wood, & Brookes, 2008; Rosenzweig & Nohria, 1994). Unilever, for example, has allowed for complete decentralization in recruiting across the globe, and each country they operate in has created its own unique locally designed recruitment strategy. General Electric (GE), on the other hand, recruits across the globe with a specific set of criteria, and looks for individuals who fit the GE value system. For instance, in 2007, of the 1,053 students hired into GE’s leadership programs, 224 were from Asia; 148 were from Europe, the Middle East, and Africa; and 681 were from the Americas (Hill, 2008).

Table 5.1. Chapter Summary.

Contingencies

Recruiting Guidelines

1. I. Exogenous

 

1. 1. Social-Cultural Context

· Train/sensitize managers to different values and expectations across the globe

 

· Create clear job descriptions that are understood across locations

 

· Decide if recruiting will be a centralized or decentralized activity

 

· Signal different incentives and perquisites to cater to different expec- tations across locations

1. 2. External Labor Market

 

1. a. Scarcity

· Create a strong campus presence

 

· Differentiate by creating an organiza- tional brand

 

· Actively tap passive job seekers

1. b. Abundance

· Create multiple recruiting rounds to zero in on the right candidate

 

· Leverage an external skills database if available

 

· Leverage employees as ambassadors to spot and attract talent

 

· Target boomerang employees

1. II. Endogenous

 

1. 1. Size

· Formalize recruiting processes

 

· Leverage the internal labor market

1. 2. Technological     Sophistication

· Leverage social networking sites

 

· Deploy creative internet technologies

 

· Create attractive organizational Web sites

There is no one best practice or gold standard for recruiting, but there are certainly some practices that organizations have followed which have helped them identify and attract good candidates (Fernández-Araoz, Groysberg, & Nohria, 2009). Typically, when human resource practices fit exogenous contingency factors such as national culture and laws, as well as endogenous organizational factors such as size or technological sophistication of the organization, they most effectively help enhance organizational performance (Immelt, Govindarajan, & Trimble, 2009; Lengnick-Hall & Lengnick-Hall, 1988; McGaughey & De Cieri, 1999; Schuler & Tarique, 2007). In the next two sections we outline key external and internal contingency factors that may influence organizations’ recruiting efforts, and call for managerial attention to these when chalking their recruitment strategies.

Exogenous Contingency Factors in Recruitment

Exogenous contingency factors are those that are outside of the immediate control of the organization, but are those which may significantly influence organizational functioning. In this section we focus two factors that can impact recruiting strategies and outcomes—the macro societal or cultural context and the external labor market in which the organization is situated. We especially focus on these two factors because of their direct impact on recruiting strategies and activities. Given the various cross-country and sometimes within-country differences in legal elements such as employment standards, worker compensation, unionization, human rights, and the availability of niche literature regarding the legal context of human resource practices (Berkowitz & Muller-Bonanni, 2007; Shilling, 2008), we do not delve into the legal context in terms of recruiting in this chapter. We also do not outline cross-country political factors in recruiting for similar reasons.

Societal or Cultural Context

Managerial assumptions and work values are shaped by the societal and national cultures in which they operate (Laurent, 1986) and human resource practices may not always trump sociocultural boundaries of different countries (Mendonca & Kanungo, 1996; Sparrow & Budhwar, 1997). Thus, although the ‘‘what’’ question in human resource philosophy may be universal (for example, effective employee recruitment), the ‘‘how’’ question may be culture-specific (for example, criteria and sources of recruitment) (Tayeb, 1995; 1998). This is especially the case because historical legacies, social stratification, educational system, and pressure groups all have their origins in national culture, and exert their own influences on work values, attitudes, behaviors, and thus on organizational human resource policies and practices (McGaughey & De Cieri; 1999; Tayeb, 1995; 1997). Overall, criteria as well as methods and sources of recruitment may be culture bound.

Managers in individual-oriented or self-oriented countries may recruit differently as compared with managers in collective or socially oriented countries (Kulkarni, Lengnick-Hall, & Valk, 2010). In individually oriented countries, recruitment may be based more on hard criteria such as competences and skills. In socially oriented countries, recruitment may be based more on soft criteria such as social and interpersonal skills, or socially ascribed status. For example, whereas education and past work experience may be specific recruitment criteria in the United States, in Asia or the Middle East a criterion may be whether or not the candidate belongs to the manager’s ‘‘in-group.’’ Specifically, managers from mature economies such as the United States may be individualistic in that their in-group may not include the workplace (Tayeb, 1995), whereas managers from growth or developing countries are generally more family- and community- oriented in that members from the workplace may be viewed as the in-group (Mendonca & Kanungo, 1996). Although the personnel function in Asia and the Middle East is becoming more strategic and objective, networks based on social contacts, caste, and other social connections still influence human resource policies and practices. Indians, for example, are relatively more collectivist, clan oriented, and caste conscious (Tayeb, 1987), and Taiwanese and Malaysians are rooted in traditional Chinese values of group or collective orientation. People in Thailand, China, and Vietnam are also known to administer preferential treatment toward network or in-group members (Zhu, Warner, & Rowley, 2007).

Networks or the collective in-group may also be determined by religion. A large body of research shows that religion is important in Islamic countries, particularly in the Middle East. Numerous studies across countries such as Egypt (Leat & El-Kot, 2007), Oman (Aycan, Al-Hamadi, Davis, & Budhwar, 2007), Iran (Namazie & Frame, 2007), United Arab Emirates (Rees, Mamman, & Braik, 2007), and Saudi Arabia (Alsahlawi & Gardener, 2004), to name a few, indicate that managers may target familiar others based on religion. The tendency to recruit from the known social network, some argue, reflects uncertainty avoidance (Leat & El-Kot, 2007), and a social or collective orientation (Aycan, Al-Hamadi, Davis, & Budhwar, 2007). This tendency may be reflective of developing countries in general (Kanungo & Jaegar, 1990), given that there is generally more uncertainty in developing countries as compared with mature ones.

Overall, societies that value interpersonal relationships will gear recruitment efforts to identify candidates that fit the social network in the organization (Aycan, 2005). This has a direct and substantive influence on where and who managers recruit. Recruitment may be especially driven by ascribed status driven by familial and social connections—that is, personal relationships—a situation that may not be overt or explicit in European organizations (Budhwar & Khatri, 2001; Sharma, 1984; Sparrow & Budhwar, 1997). In sum, collective or high–uncertainty avoidance cultures may prefer internal recruitment channels, and informal and network-based recruitment (Aycan, 2005). Considering the fact that people who live and work in countries described as ‘‘developing’’ or ‘‘growth’’ comprise almost 80% of the world’s population (Aycan, Al-Hamadi, Davis, & Budhwar, 2007), and this region is where job growth is currently highest (International Labour Organization, 2009), the impact of social factors cannot be overlooked by multinational organizations.

What have organizations done given this situation? Recognizing such regional differences, some organizations, such as Unisys, leverage a hybrid model to tap into global talent. In a hybrid model, each business unit has a recruiting specialist to fulfill functional roles within that designated unit, but targeted recruiting strategies are centralized. Thus the process of implementing the recruiting policy is delegated to the local units which are clearly tuned into local realities (Corporate Leadership Council, 2006b).

Macro societal aspects also influence what the available labor pool values, and consequently what organizations should signal when attracting candidates. For example, whereas candidates in individually oriented countries such as the United States strongly value health benefits, this benefit is among the least valued in Asia and Australia. Recruitment efforts thus have to be targeted. Cendant Mobility, a provider of workforce development solutions, provides an example from India. Indian employees have familial obligations and responsibilities that are complex and often more demanding than a Western notion of family responsibilities. Indians may be expected to care more for their extended families (Budhwar, 2001; 2003; Kulkarni, Lengnick-Hall, & Valk, 2010). This suggests that work-life benefits such as flexible time-off may be more compelling for attracting candidates in India as compared with elsewhere (Corporate Leadership Council, 2006b).

So what should global managers do in regard to the macro social context when recruiting globally? One, global managers should be trained and sensitized to be aware of the significant roles that institutions such as family, religion, education, trade unions, and the state play in shaping employee attitudes and actions across the world. This awareness will help the managers to devise appropriate means to handle diversity at the micro level. Two, managers should clearly describe the jobs for which they are recruiting so that even if certain regions tap into their social networks and leverage informal methods, recruitment and hiring is particular to the job in question. Three, managers must decide if they want to delegate recruiting to local units, and for which levels of hiring this delegation is appropriate. Four, managers should build flexibility into their recruitment strategies to include and actively signal different incentives and perquisites to cater to different expectations across the world.

Labor Market Conditions

The second macro level contingency which directly and significantly affects recruiting efforts is the condition of the labor market. The labor market is defined as the general area from which applicants have to be recruited. Various factors such as national and regional economies, skill and education level of the workforce, and demographic composition of the labor pool all affect the labor market. This story gets complicated further when we consider the global labor market. Two types of labor markets influence recruitment—scarce and abundant labor markets. Scarcity in the labor market implies that the labor market is tight, and there is low unemployment. Consequently, organizations have to try harder to recruit good candidates. Abundance in the labor market, on the other hand, implies the labor market is loose, and there is high unemployment (Bohlander & Snell, 2004). It is important to note, however, that the labor market is different for different levels within an organization. For example, it is quite possible that even though there is an abundant supply of available labor for lower-level positions, recruiting people for strategic positions may be tough, as that market may be scarce. We first discuss how a scarce labor market influences recruitment efforts, and then focus on how an abundant labor market influences recruitment efforts.

Scarcity in the labor market. Consider these examples. The Cheesecake Factory in the United States attracts and hires over 20,000 people per year, operates more than 110 restaurants, and is expanding nationally (Dessler, 2008). Infosys attracts and hires over 24,000 people annually, and is expanding globally. Further, a depleting talent pool is forcing organizations to incur higher costs to source the right talent. How can organizations such as these find good candidates? The solution that most organizations have adopted is innovation in their recruitment efforts and strategies (Dessler, 2008; Kossek, 1987).

Organizations can employ one or all of three strategies to attract candidates in a scarce market—attract candidates through innovative campus recruiting efforts, create a strong organizational brand, actively tap ‘‘passive’’ job seekers—and, if possible, leverage technology for all of the above. The three strategies are not mutually exclusive (campus activities can help build an organizational brand) but are discussed separately for tractability. In the following, we discuss ways in which various organizations have successfully implemented the previous strategies. Use of innovative technologies depends on the technological sophistication of an organization, and we therefore discuss it in greater detail in a later section which elaborates on internal contingency factors.

Creating a strong campus presence. A wide variety of organizations with a presence across the world utilize campus recruiting heavily to attract bright candidates. We will consider examples from Ernst and Young (Sullivan, 2008b), Tata Consultancy Services Ltd. (Fernández-Araoz, 2007), Procter & Gamble (Ready & Conger, 2007), Valero (Sullivan, 2006c), and Infosys (Birkinshaw, 2008). What do these organizations do in common? All four organizations have created a strong campus presence and have established robust ties with national or international universities, or both, for campus recruiting.

Campus recruiting is taken very seriously at Ernst and Young, and they have created a campus-centric team approach that includes a coordinating partner, campus recruiter, campus champion (senior manager), a diversity champion, and they have added campus recruiting goals into managers’ personal development plans and performance scorecards. They have strong internship program ties with over 300 business schools in North America, and they leverage former interns as campus ambassadors to attract newer candidates. These practices ensure that 90% of their interns join them as full-time hires (Sullivan, 2008b). Similar practices are followed by Infosys (Birkinshaw, 2008).

University recruiting is also a line-led activity at Procter & Gamble, and many senior managers personally lead campus teams at top universities around the world. To strengthen and solidify ties with top universities, which are a key source of talent, the campus team leaders not only lead recruitment efforts, but they also fund research, make technology gifts, and participate in various activities such as conducting talks at the campus, or judging competitions (Ready & Conger, 2007). Valero goes a step further in terms of innovative practices in campus recruiting. They leverage teaching assistants as talent scouts on targeted campuses, allowing Valero to secure interns and full-time employees prior to going for formal on-campus recruiting events (Sullivan, 2006c). Accenture taps into specific student clubs at elite universities such as Yale to recruit the brightest from campus (McConnon & Silver-Greenberg, 2008). Tata Consultancy Services (TCS) has also implemented a unique recruitment strategy to build strong campus ties. They have partnered with certain schools to design specific classes that fit TCS manpower and skill requirements (Fernández-Araoz, 2007).

Overall, campus recruiting not only helps directly in securing candidates; it also helps indirectly by creating a future pipeline of candidates based on the recruiting organization’s past actions and the reputation it builds on campuses from where it routinely recruits. For example, when recruiting on campus, Motorola China offers a variety of services to students including career planning, resume writing, and team-building exercises. As a result, the organization hires about 250 to 400 interns annually from partner colleges, of which 60–80% eventually become full-time employees (Corporate Leadership Council, 2006b). Some organizations target students even before they get to any university. Organizations such as Lockheed Martin, Boeing, IBM, and General Electric undertake various activities to teach U.S. high school students science, technology, engineering, and math skills. Boeing volunteers, for example, teach science with the aid of flight simulators and a mock space shuttle with wireless computers, and Northrop Grumman, a leading global security organization, provides 7,000 high school seniors across North America with 17 weeks of elementary job training. About 6,000 students have found jobs at Northrop since the program started in 1971 (Reveron, 2009).

Differentiating by creating an organizational brand. Another strategy that organizations follow to attract candidates is to create a clear employer brand image. Organizations such as Google, for example, have been very successful at branding, and consequently attracting candidates (Sullivan, 2006a) who are attracted to what is implied by the brand. Organizations follow various methods to create a brand image by signaling certain positive attributes and differentiating themselves in a labor market. Branding influences familiarity and recall ability which in turn positively influence candidate attention and job application behaviors (Collins, 2007). The key idea in branding is to make the organization salient in the mind of the labor pool, so that when the opportunity arises, candidates will apply to the organization.

So which recruiting strategies based on branding have organizations followed to ensure that people sit up and take notice of them?

Hiring managers at Intel offer podcasts and host Webinars to explain jobs and opportunities, and answer questions from potential candidates. This is a low-cost method for building relationships and it also focuses on a very specific audience that the organization is trying to target (Institute of Management and Administration, Inc., 2008). Another low-cost but relatively nontraditional method to attract skilled workers is what is referred to as‘‘ proximity recruiting ’’ Toxbox, a next-generation provider of a free service that lets you talk with your friends over live video, engaged in innovative proximity recruiting when Yahoo! was laying off its employees. Toxbox set up a taco truck outside Yahoo’s campus and offered affected and other employees hot lunch while also advertising employment opportunities at Toxbox. They could thus tap into valuable talent from Yahoo! and garner enormous publicity for their relatively unknown organization (Sullivan, 2008a).

Certis CISCO, the largest auxiliary police force operator in Singapore, traveled a little farther away from their campus to develop their brand and recruit candidates. They wanted to attract relatively large numbers of auxiliary police officers and management personnel to join their growing organization. This was accomplished by sending out a ‘‘recruitment bus’’ to travel to the heartlands. They also organized road shows where they offered iPods to the first 100 applicants, and set up library talks to reach out to people who may not necessarily have been familiar with the force (Lee, 2007).

Organizations across the world have also used visual media to promote their brand and gain attention of applicants by making the organization salient in the minds of people exposed to the media. Donald Trump’s ‘‘The Apprentice’’ and ESPN’s ‘‘Dream Job’’ are well known. Organizations such as Aviva Life Insurance, Flextronics Software Systems, LG Electronics, Impetus Technologies, DNA, Yes Bank, and Denstu have also participated in a televised recruitment drive. This televised event was hosted in India by Naukri.com, in association with CNBC TV 18, a leading business news and information channel (‘‘The Job Show,’’ 2006). Deloitte Consulting also leveraged visual media, and in 2007 invited its employees to create a three-minute amateur film answering the question, ‘‘What’s your Deloitte?’’ Not only did this initiative spark widespread interest within the internal community, it eventually became a great recruiting tool for the organization (Fugure, 2009).

Finally, to stand apart in a crowded organizational world, some organizations include the applicant’s family in the recruitment drive. For example, some organizations pay the expenses for an applicant’s spouse to accompany him or her on a site visit. This organizational act suggests to the applicant that the organizational culture is supportive of work-family issues (Boswell, Roehling, LePine, & Moynihan, 2003). Overall, these strategies are designed to make the organization salient in the minds of potential job seekers.

Actively targeting passive job seekers. A survey of global CEOs shows that most organizations start their recruitment process reactively when a position opens, but it is clearly more useful to start the search process much in advance for all levels of the organization. Intuit, a software organization, known for such products as QuickBooks and TurboTax, carefully starts their search process in advance of headcount needs. They have created supply-demand maps for all organizational levels and manage to accurately anticipate more than 90% of their talent needs (Fernández-Araoz, Groysberg, & Nohria, 2009).

However, anticipating need and then targeting the correct candidate is tougher than it may seem, especially for strategic positions. In such cases, organizations may actively seek passive job seekers—people currently employed by other organizations, who are happy at their current workplace, and aren’t looking actively for jobs (Chatman, O’Reilly, & Chang, 2005). Consider the case of Amazon. Amazon’s business model requires the organization to manage a constant flow of new products, suppliers, and customers, as well as deliver orders by promised dates. When Amazon needed a new head for its global supply chain, it recruited Gang Yu, a professor of management science and a software entrepreneur who is one of the world’s leading authorities on optimization analytics. Of course, this combination of analytical, business, and relationship skills was difficult to find, and Amazon looked at nontraditional sources to tap someone who can be seen as a ‘‘passive job seeker.’’ SAS, a software organization, also needs candidates for niche and state-of-the-art business applications such as predictive modeling or recursive partitioning (a type of decision tree analysis). To fill these niche positions, they begin recruiting up to 18 months before they need to fill such positions (Davenport, 2006).

Consider yet another example. Chiron, a pharmaceutical organization, operates in a very tight labor market where only a few potential candidates exist around the world for certain scientific positions. Chiron recruiters learn the business specifics from various business units and try to build relationships with passive job seeker scientists who are in turn open to talking with someone who understands their work and business (Corporate Leadership Council Recruiting Roundtable, 2006).

Passive job seekers can be sought from various places and in various ways. Cisco recruiters follow innovative recruiting tactics such as attending garden shows or microbrewery festivals—any potential places that their target candidates frequent. At one point Cisco had also rigged its Web site to spot candidates from rival organization 3Com and greeted these people with a page that asked them if they wanted a job at Cisco (Kiger, 2003). Though this may sound like an outrageous strategy, recruiters also frequent bars where unsuspecting target candidates may congregate (Sullivan, 2006b).

The other strategy that organizations are following to tap into key candidates in a tight labor market is to look at the temporary or part-time labor pool. To target such candidates, organizations are leveraging niche job boards. Stay-at-home mothers who are looking for jobs can be recruited through channels such as Working Mother Magazine, or bluesuitmom.com; temporary workers can be targeted via channels such as temps.com; retired employees can be tapped through retiredbrains.com; and finally, diverse demographic groups can be tapped into through latina.com or blackcareerwoman.com. Organizations such as United Parcel Service (UPS) that leverage a large temporary workforce customize part of their Web site to target the part-time candidates. For example, their Web site showcases employee testimonials in terms of what the organization has done for the specific demographic groups, and why it is therefore a good fit for other such candidates (Corporate Leadership Council, 2006a). L’Oreal follows a similar strategy and highlights women scientists on their Web site to attract other such employees (Institute of Management and Administration, Inc., 2008). Finally, the U.S. Army uses simulation video games directed at recruits who are technologically sophisticated and avid gamers (Sullivan, 2006a).

In sum, scarcity in the labor market can be dealt with by creating a campus presence, making the organizational brand salient in the minds of potential candidates, and actively tapping passive job seekers. In the next section we discuss how organizations adapt their recruitment strategies when there is abundance in the labor market.

Abundance in the labor market. At first glance, it may seem like an ideal situation—organizations have a large pool of candidates to choose from, but surveys and studies show that finding good candidates is tough even in times of high unemployment where the supply from the external labor market is not tight (Dessler, 2008). To make matters worse, many job applicants who are in the labor market looking for jobs have an incomplete or inaccurate understanding of what a job opening involves, are not sure what they want from a position, and do not have insight with regard to their knowledge, skills, and abilities (Breaugh, 2008). Thus, abundance in the labor market implies that organizations have to sift through a deluge of non-matched candidates. What do organizations do in such conditions? There are various strategies—they can create multiple rounds to zero in on the right candidate, leverage an external skills database if available, leverage employees as ambassadors to spot and attract talent, and target boomerang employees.

Creating multiple rounds to zero in on the right candidate. Consider the sheer number of applicants at Infosys. Every year, 1.3 million candidates apply for a job at Infosys, and about 17,000 are selected. How does Infosys deal with this large number? Recruiters have created various rounds to zero in on the right candidates. Online applications are screened carefully, and only 10% of the applicants are invited to take an online test designed to measure applicant technical and written skills. This test is conducted by an external vendor and less than 1% of people who do well on this test are considered further (Birkinshaw, 2008). Thus, capitalizing on technology allows Infosys to narrow an immense number of possible candidates down to a more select and manageable amount.

Leveraging an external skills database. To sift through the vast number of applications, industry bodies are also helping organizations. For example, The National Association of Software and Services Companies (NASSCOM), the chief industry body for the Indian information technology (IT) and technology services companies, has created a National Skills Registry (NSR), a centralized database of all employees of the technology services and business process outsourcing (BPO) organizations in India. Launched in 2006, the NSR contains third-party–verified personal, qualification, and career information of IT professionals. Organizations in the IT and BPO industry leverage this skills database to inform their recruitment practices.

Leveraging current employees as ambassadors to spot and attract talent. Cisco is another organization that gets many applicants. To ensure they hire the correct candidate from many applicants, Cisco follows an innovative strategy by carefully targeting ‘‘active job seekers.’’ Cisco noticed that people would click on their Web site for information about the organization, and wanted to know more in terms of the work opportunities available. Cisco created a ‘‘make friends @ Cisco’’ button on their Web site, and when people clicked on this button, they got a call from current Cisco employees who talked about their work. A few years ago, Cisco received 100 to 150 requests per week from applicants wishing to be introduced to a ‘‘friend@Cisco,’’ and 60% of the people who joined Cisco did so because they had a friend working there already (Chatman, O’Reilly, & Chang, 2005). Cisco also relies heavily on employee referrals, and about 55–60% of its hires in the sales organization are from referrals (‘‘Perfecting your employee referrals program,’’ Human Capital, 2006).

The Cisco example brings up an important point. Employees are a good resource in terms of sifting through candidates as well as attracting candidates (‘‘Perfectingyour employee referrals program,’’ 2006). Employees understand how an organization functions and who may be a good fit. Recognizing this, some organizations have very successfully used employee referral programs. At Sasken, 30% of the top management level recruiting is done through referrals, whereas 32% of all hiring is through referrals. Other organizations leverage their social networks to spot the right candidates. At Eli Lilly, for example, key new hires are asked to identify good performers that the organization can eventually target. Eli Lilly also hosts ‘‘bring your own rolodex’’ meetings where senior staff are encouraged to network with passive but high-value potential candidates. Organizations can thus develop a large talent pool proactively and much in advance of actual staffing needs by tapping into networks of employees (insiders) as well as trusted suppliers, customers, and former employees (outside-insiders) (Fernández-Araoz, Groys-berg, & Nohria, 2009).

Targeting boomerang employees. The final strategy we discuss in this section is called boomerang recruiting. Boomerang employees, also commonly referred to as rehires, are former employees who return to an organization. Oftentimes, employees leave the organization only to realize that their ex-employer wasn’t as bad as they’d thought. At the same time, the ex-employer may want the same employee back, given her skill set that was developed within the organization and thus well suited to it. Boomerang recruiting is cost efficient because of lower costs of retraining such employees and building their organizational commitment (naukrihub.com, 2009). Organizations such as McKinsey, Microsoft, Deloitte, Ernst and Young, Booz Allen, and Bain, to name a few, are pioneering corporate alumni programs to track good employees who have left the organization and may want to come back (Puri, 2009). Booz Allen Hamilton has gone further, and has created a dedicated team called the ‘‘comeback kids’’ that has proven very successful in encouraging former employees to return (Sullivan, 2006a).

In sum, abundance in the labor market can be dealt with by creating multiple rounds of recruiting, leveraging an external skills database if available, leveraging employees as ambassadors, and targeting boomerang employees. In the next section we direct our attention to endogenous or internal organizational factors that influence recruitment strategies.

Endogenous Contingency Factors in Recruitment

Various organizational level or internal factors influence an organization’s recruiting strategies. In this section we elaborate on two factors that can have an impact on recruiting strategies and outcomes: the size of the organization, and its technological sophistication. Although various indicators of size such as sales volume or other performance measures are used, the most common indicator of size is the number of employees, as this indicates both current capacity for work and current performance level (Scott, 2003). In this section we also use the word size to denote number of employees, as this has a direct relationship with human resource strategies. Technological sophistication of the organization implies organizational comfort with leveraging technology, and this also has a direct relationship with human resource strategies, especially attracting and tracking candidates. It is quite possible that large global organizations are also technologically more sophisticated than small local setups.

Organizational Size

Organizational size influences the structure of departments, their functioning, and strategies of an organization. As organizations grow, a simple informal model of control through mutual adjustment and social interactions gives way to more standardized control (Mintzberg, 1979). Human resource strategies and recruitment practices in particular also become more formal, bureaucratic, and resource intensive than practices of smaller organizations (Fisher, Schoenfeldt, & Shaw, 2006). Large organizations can follow two broad strategies when recruiting: formalize recruiting processes across the organization, and leverage the internal labor market. This is an especially important point for large global organizations that can systematically comb their own ranks to spot and deploy talent where required.

Formalizing recruitment procedures. Formalizing external recruitment procedures is important because large organizations are involved in recurring transactions (such as recruiting many people) and can economize costs per recruit (Bhattacharya, 2008). Recruiting costs of large organizations such as Infosys can be amortized over many hiring decisions. Further, large organizations are more likely to have dedicated recruiters who are formally trained. Larger organizations are also more likely to use more screening procedures than smaller organizations because large organizations have the resources available to design or acquire (and validate) multiple screening devices such as psychological tests, physical abilities tests, and so forth (Birkinshaw, 2008). Finally, formalization is important as large organizations face institutional pressures and public scrutiny and are answerable to multiple stakeholders (Barber, Wesson, Roberson, & Taylor, 1999; Kossek, 1987).

Leveraging the internal labor market. Considering that formal procedures in recruiting can be seen through previous sections and examples, this section will focus on recruiting in the large internal labor market that exists in large organizations. A 2004 poll conducted by Development Dimensions International showed that internal recruiting for management positions was at 53% within the 350 organizations polled. This was an increase from 44% in 1999 (Little, 2007).

Why do (or should) organizations recruit from their internal labor pool? Recruiting from within has many advantages. It may be relatively cheaper to attract and hire candidates from within the organization than outside, it is a great retention tool, and, finally, a great way to develop and nurture talent (Plemmons, 2009). In fact, a recent report shows that Skanska, one of the world’s leading construction groups, which has a presence across 19 countries and employs over 60,000 employees worldwide, saved several million dollars last year by recruiting internally (Resourcing, 2009). Recognizing the importance of recruiting from within, organizations such as General Electric and United Parcel Service put great emphasis on developing talent that can be leveraged in multiple units of the organization when needs arise (Fisher, Schoenfeldt, & Shaw, 2006).

How do organizations tap into the available labor pool to fill positions as they open up? Consider the cases of Cisco and Houston’s M. D. Anderson Cancer Center. Cisco created and launched a software application called the Pathfinder. This software, used by about 20% of the organization’s engineers to change jobs, allows employees to load their résumés into the system, sift through openings by location, career level, and other criteria, and then contact the hiring managers in other business units directly (Kiger, 2003). When employees self-attract and apply in some organizations, internal recruiters at M. D. Anderson actively look at the availability of internal talent and projected hiring needs, and target key people (Plemmons, 2009). Managers at ANZ Financial Services (Australia and New Zealand Banking Group Limited) actively mentor junior colleagues, and between half to one-third of the financial planners are recruited from different units of the organization (Egan, 2007). Other organizations such as Merck and the U.S. military have leveraged technology to spot and recruit internal candidates. These organizations use human resources information systems such as SAP and PeopleSoft to tap into the internal labor pool (Bohlander & Snell, 2004).

Organizations endowed with large internal labor markets can also use a process called job posting and bidding to leverage internal talent. This process can be as simple as posting an opening in the cafeteria to putting it up on the internal Web server. Texas Instruments, Xerox, and Cisco, to name a few of many organizations, do this quite effectively (Bohlander & Snell, 2004). Overall, size affords recruiters and hiring managers a large internal pool of talent, and possibly a formalized predetermined recruitment process that can be used across locations.

Technological Sophistication

The final contingency we discuss in this chapter is the level of organizations’ ever-expanding technological sophistication. Whether the organization is recruiting internally or externally, within social networks or outside, or in tight or loose labor markets, organizations can effectively use technology to attract candidates. After all, the world is getting smaller and recruits are sometimes just a click away (Friedman, 2006). In the sections below we describe how various organizations have leveraged technology to recruit candidates. We identify three broad recruiting trends in this section: leveraging social networking sites, deploying creative Internet technologies, and creating attractive organizational Web sites.

Leveraging social networking sites. Social networking sites continue to gain enormous popularity and momentum. To target specific types of candidates, and to broaden their recruitment efforts, organizations are increasingly trying to tap into the large number of people active on social networking sites such as LinkedIn. Web sites like Orkut, Facebook, and other social media sites are the new haunting places for human resource professionals these days to scout for talent that can deliver results (Shah, 2007). Technology organizations like Wipro, and Tata Consultancy Services have started recruiting heavily through social media networks. Ernst and Young also heavily leverages Facebook to target students (Sullivan, 2008b). It’s not just the traditional civilian large organizations that are leveraging social networking sites to recruit people. The U.S. Central Intelligence Agency, the U.S. Navy, and the Army are also using Facebook and Twitter to recruit talent (Bruce, 2007; MSNBC report, 2009). In fact, a recent survey by Development Dimensions International showed that 25% of recruiters used social networking sites for information about candidates, and 52% of them have used online information to make selection decisions (Recruiter, 2009), a trend that is likely to continue considering the growing millions of active and passive job seekers that throng such Web sites.

Along with organizations, professional head hunters across the world are also making social networking sites a part of their recruitment strategy, and are setting up dedicated resources to sift through these sites for global recruiting (CyberMedia, 2007; Sachitanand & Bhattacharya, 2008). LinkedIn is becoming such a popular recruiting source the world over that professional recruiters are demanding the same full access that organizations have in order to have access to more candidates (Goodfellow, 2008).

Deploying creative Internet technologies. Organizations are also increasingly using creative technologies to spot and attract candidates. Some organizations are using the Web site X-raying technique to access the passive talent pool. This technique allows recruiters to see all pages on an organizational Web site that are not protected by a firewall. X-rays can be done using the advanced search feature on Web sites such as Google or Hotbot. Another technique used by organizations is called Web site flipping. Flipping allows recruiters to find all Web pages linked to a given Web site. For example, recruiters can access individual home pages that are linked to organizational Web sites. Such cross-linked sites can yield valuable passive candidate information. One has to keep in mind though, that such techniques are not legal throughout the world.

Yet another technique to get access to job seekers is using name-generating software. This software can be purchased and allows recruiters to sift through the Internet to generate names, profiles, and resumes of individuals meeting the search parameters specified by the recruiter. Intel, in 2004, worked with a vendor to create such customized software. This software ‘‘crawled’’ through a list of pre-programmed sites to access very specific types of candidates (Corporate Leadership Council and Recruiting Roundtable, 2006). Valero also automated part of their recruiting efforts and programmed ‘‘Web spiders’’ to crawl, retrieve, and upload candidates into their internal applicant tracking system based on both current and projected needs (Sullivan, 2006c). Wachovia, on the other hand, paid for this service instead of developing one in-house. Various vendors such as ZoomInfo, LinkedIn, and SearchExpo provide this service for a fee. Other technology-savvy organizations such as Microsoft encourage and actively leverage recruiter and employee blogs. Such blogs can be used to target passive job seekers who are surfing the net. They can be used to build a relationship with the potential employee as well as create an organizational brand.

Creating attractive organizational Web sites. The final trend we discuss is how organizations can leverage their own Web site to attract candidates. Skoda Minotti, for example, uses a rather innovative way to attract applicants. Their Web site hosts a game similar to ‘‘photo audit,’’ where players spot differences in photos within a given time and have their scores displayed in a competitive fashion against other players. Potential applicants from various campuses, who are playing the online game, get ranked against each other and can see scores of others from their schools. High scorers are given rewards. This increases Web traffic to Skoda’s site and gives Skoda a database of potential hires (Ebenstein, 2008). Skoda Minotti and The Cheesecake Factory both use a promotional recruitment video on their Web sites that explains how the organization runs, how people are such a key asset, and how the potential recruit will enjoy working for this great organization. For organizations that cannot host videos on their own Web sites, there are other cyber places such as VlogYourJob.com. VlogYourJob.com is the United Kingdom’s first online video recruitment Web site, created by Indigo Red, a U.K.-based recruitment consultancy. This Web site encourages organizations to post vlogs–online short videos–as job advertisements. It also allows recruiters to give potential candidates a taste of what it’s like at the organizations by posting a video about their working environment (Marketing Week, 2007). Thus, organizations that have technological sophistication can leverage both in-house and externally developed technologies to recruit.

Conclusion

We defined recruiting as a process of finding and attracting the right candidates and encouraging them to apply for certain positions. We drew upon recruitment research and organizational examples to outline various contingencies that managers should consider when undertaking recruitment initiatives. So what does all this mean for your own recruiting efforts? How can you create an effective recruiting strategy in your organization? As outlined in Table 5.1 , we especially argued for the importance of the macro sociocultural context and the external labor market as the two key exogenous factors that have an impact on recruitment. We also pointed to the importance of organizational size and evolving technological sophistication as the two key endogenous factors that affect recruitment. For each of these contingencies, we have distilled lessons based on organizational theory and examples. For instance, when discussing the social context, we have argued for the importance of sensitizing and training global managers about different values and expectations across the globe, and of creating clear job descriptions that can be implemented irrespective of where the managers recruit from. Further, on the topic of the external labor context, we have highlighted the importance of creating salience in the minds of potential applicants and tapping passive candidates in a scarce labor market. In terms of an abundant labor market, we have pointed out the importance of creating multiple rounds of recruiting, leveraging external databases, internal employees, and targeting ex-employees. We have argued that large organizations can formalize procedures and tap the internal labor pool. Finally, technology can be leveraged to attract candidates. Specifically, organizations can leverage social networking sites, deploy creative Internet technologies, and create effective and attractive organizational Web sites.

Overall, we recognize that no two organizations are the same, and contingencies and recruitment strategies differ per organization. Although there is no magic formula for recruiting, and some of these techniques may force you to think outside the box, the benefits of charting a well-defined recruiting strategy are clear.

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