Week 2 - Discussion 2 - Strategic HR Mgmt- Initial post due by Wed 6/8

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Selecting Employees Who Fit

Chapter 6

LEARNING OBJECTIVES

After reading this chapter you should be able to:
Describe how employee selection practices can strategically align with overall HR strategy.
Explain what makes a selection method good, and be able to apply the concepts of reliability, validity, utility, legality and fairness, and acceptability to appropriately evaluate different employee selection methods.
Describe several commonly used selection methods, evaluate their strengths and weaknesses, and explain how they link with particular employee selection strategies.
Explain how to combine scores from several different selection methods to arrive at a final selection decision.

Employee selection

The process of choosing people to bring into an organization.
Effective selection provides benefits to an organization
It can improve the effectiveness of other human resource practices and prevent numerous problems.
For example; motivated employees who fit with the organizational culture can reduce disciplinary problems and diminish costs associated with replacing employees who quit.

Employee selection is the process of choosing people to bring into an organization.
Effective selection provides many benefits. Selecting the right employees can improve the effectiveness of other human resource practices and prevent numerous problems. Example: hiring highly motivated employees who fit with the organizational culture can reduce disciplinary problems and diminish costs related to replacing employees who quit.

HOW IS EMPLOYEE SELECTION STRATEGIC?

Good selection practices must fit with an organization’s overall HR strategy.
In Chapter 2 we saw HR strategies vary on two dimensions:
whether they have an internal or an external labor orientation and
whether they compete through cost or differentiation.
These provide guidance about the type of employee selection practices that will be most effective for a particular organization.

Good Selection Practices must fit to the overall HR strategy of the organization.
HR strategies vary on two dimensions:
whether they have an internal or an external labor orientation
whether they compete through cost or differentiation.
The overall HR strategies provide important guidance about the type of employee selection practices that will be most effective and utilized in the organization.

Aligning Talent and HR Strategy

The chart in Figure 6.1 shows how selection decisions can be aligned with the HR strategies.
The horizontal dimension represents differences in the type of talent sought
The vertical dimension represents the type of relationship between the employees and the organization .

Figure 6.1 shows how selection decisions can be aligned with the HR strategies outlined in Chapter 2. Consistent with the overall HR strategies, strategic selection decisions are based on two important dimensions. The horizontal dimension of Figure 6.1 represents differences in the type of talent sought. At one end of the continuum is generalist talent—employees who may be excellent workers but who do not have particular areas of expertise or specialization. At the other end of the continuum is specialist talent—employees with specific and somewhat rare skills and abilities.

The vertical dimension of Figure 6.1 represents the type of relationship between the employees and the organization. At one end of the continuum is long-term talent. Employees in this category stay with the organization for a long time and develop a deep understanding of company practices and operations. At the other end of the continuum is short-term talent. These employees move from organization to organization without developing expertise in how things are done at any particular place.

Figure 6.1 Strategic Framework for Employee Selection

Aligning Talent and HR Strategy

Short-term Generalists - provide a variety of different inputs but do not have areas of special skill or ability.
This is most often associated with the Bargain Laborer HR strategy.
Most positions are filled by hiring people away from other organizations.
The objective is to identify and hire employees to produce low-cost goods and services.
To selection people who can perform simple tasks that require little specialized skill.

Short-term generalists, provide a variety of different inputs but do not have areas of special skill or ability. Examples include some retail sales clerks and hotel housekeepers.
Organizations with this HR strategy fill most positions by hiring people away from other organizations. Selection has the objective of identifying and hiring employees to produce low-cost goods and services, and selection decisions are based on identifying people who can perform simple tasks that require little specialized skill.

Benefits of a Short-Term Generalist Strategy

People without specialized skills do not generally demand high compensation, which keeps payroll costs as low as possible.
Because Short Term Generalist lack specific expertise, they also are usually more willing to work in routine jobs and do whatever they are asked.
The number of employees working for the organization can be flexed up or down as demand for goods and services increases or decreases
Work procedures are simple, and employees who demand higher wages are simply replaced by new workers.

Long-term Generalists

Are individuals who have developed skills and knowledge concerning how things are done in a specific organization.
Long-term generalists are beneficial for organizations using the Loyal Soldier HR strategy.
HR strategy is focused on keeping employees once they are hired.

People working for utility companies are often long-term generalists who do not have technical expertise but who develop skills and knowledge concerning how things are done in a specific organization.
Common examples of long-term generalists are people who work for other utilities and for some package delivery companies.
These workers contribute in a number of areas but do not need specific technical skills and abilities. Long-term generalists are beneficial for organizations using the Loyal Soldier HR strategy.

Benefits of a Long-Term Generalist Strategy

Lack of specific expertise allows firms to reduce payroll costs.
Employees have develop skills and abilities that are only valuable to the specific organizations, which reduces the likelihood that they will move to another employer.
Reduction in the recruitment, selection and training expenses.
Because they stay long they tend to develop relationships and form a strong sense of commitment to the organization.

Slide is self-explanatory

Long-term Specialists

These are people who have an expertise in a particular area. Such as Accounting.
The use of long-term specialists fits the Committed Expert HR strategy.
Selection is to identify people who can assist the company in innovating and produce superior goods and services over time.
People are hired who can develop specialized skills over time and create a resource of talent.

Long-term specialists are people who develop deep expertise in a particular area.
Pharmaceutical sales representatives and research scientists are also commonly employed as long-term specialists.
People in these jobs are expected to develop specialized skills and stay with the organization for a long time. The use of long-term specialists fits the Committed Expert HR strategy.

Benefits of Long-Term Specialists

It enables organizations to create and keep a develop talent.
Employees are given the time and assets to develop the skills they need to be the best at what they do and add value back to the organization.

Short-term Specialists

Are employees who provide specific inputs for relatively short periods of time.
Associated with the Free Agent HR strategy.
Staffing is aimed at hiring people who have already developed skills that they can bring to the organization to produce innovative goods and top-quality service.

Information technology specialists often work as short-term specialists—employees who provide specific inputs for relatively short periods of time.
Staffing is aimed at hiring people who will bring new skills and produce innovative goods and top-quality service, and selection decisions focus on identifying people who have already developed specific skills.

Benefits of Short-Term Specialists

Employees provide services relatively short periods of time.
Allows the organization to quickly acquire needed expertise, without waiting for hires to acquire the skills.
The organization pays premium dollar for this knowledge and skills but makes no long-term commitments and both parties can end the employment relationship at anytime.

Making Strategic Selection Decision

The focus is on two factors:
job-based fit
organization-based fit

Another way to examine how organizations make employee selection decisions focuses on two primary factors. One factor is the balance between job-based fit and organization-based fit.
See following slide for specific information on the two factors.

Balancing Job Fit and Organization Fit

Job-based fit seeks to match an individual’s abilities and interests with the demands of a specific job.
Organization-based fit is concerned with how well the individual’s characteristics match the broader culture, values, and norms of the firm

When job-based fit is the goal, the organization seeks to match an individual’s abilities and interests with the demands of a specific job. This type of fit is highly dependent on a person’s technical skills. For instance, high ability in mathematics provides fit for a job such as financial analyst or accountant.
Organization-based fit is concerned with how well the individual’s characteristics match the broader culture, values, and norms of the firm. Organization-based fit depends less on technical skills than on an individual's personality, values, and goals.
A person with conservative values, for example, might fit well in a company culture of caution and tradition

Selecting the Best Selection Method-Questions to ask

How reliable is the process-do you get the same result time and again.
Is it valid-does it relate to the job or performance outcome
Is the method cost effective-utility.

Reliability is concerned with consistency of measurement.
One way to evaluate reliability is to test or interview a person on two different occasions and then determine whether the person’s scores are similar across the two times. We call this the test-retest method of estimating reliability.
Another way to evaluate reliability is to give two different forms of a test.
Since both tests were designed to measure the same thing, we would expect people’s scores on the two tests to be similar. This is the alternate-forms method of estimating reliability.
Ask students How do we know if a test is valid?
Evidence of validity can come in many forms, and assessments of validity should take into account all evidence supporting a relationship between the assessment technique and job performance.
The third principle associated with employee selection methods is utility, which concerns the method’s cost effectiveness. Is the test to expensive for the number of applicants to be tested.

Utility

Choosing the Best Selection Method-Questions to ask

Is the process legal – does not break any laws and fair – treats every application the equally.
Is it acceptable – How does the applicant view the selection process and consequently the organization.

Is the process legal. Here is where the HR professional has to be aware that the assessment methods do not break any laws and is fair for all applicants. Each application is treated equally and fairly. Relate back to chapter 3.
When the applicant view the selection process as fair and equitable they consequently have a positive image of the organization and view the methods as acceptable.

Figure 6.2 What Makes a Selection Method Good?

Figure 6.3 Graphical Illustration of Correlations

Correlation coefficient is a statistical measure that describes the strength of the relationship between two measures.

WHAT SELECTION METHODS ARE COMMONLY USED?

The three most common methods used are:
Testing
Gathering Information
Interviewing

Employment testing provides a method for assessing employability characteristics. Tests provide a common set of questions or tasks to be completed by each job applicant. Different types of tests measure knowledge, skill, and ability, as well as other characteristics, such as personality traits.
Organizations use a variety of methods to directly gather information about the work experiences and qualifications of potential employees. Common methods for gathering information include application forms and résumés, biographical data, and reference checking.
The interview is the most frequently used selection method. Interviewing occurs when applicants respond to questions posed by a manager or some other organizational representative. Most interviews incorporate conversation between the interviewer and the applicant. The interview is useful not only for evaluating applicants but also for providing information to them and selling the organization as a desirable place to work.

Testing

Tests measure knowledge, skill, and ability, as well as other characteristics, such as personality traits.
Types of Test
Cognitive Ability Testing. Cognitive ability testing measures learning, understanding, and ability to solve problems. e.g. Intelligence Tests.
Personality testing measures patterns of thought, emotion, and behavior. e.g. Myers Briggs

Cognitive ability testing measures learning, understanding, and ability to solve problems.
Cognitive ability tests are sometimes referred to as “intelligence” or “mental ability” tests. Some measure ability in a number of specific areas, such as verbal reasoning and quantitative problem solving.
Personality testing measures patterns of thought, emotion, and behavior.[
Researchers have identified five broad dimensions of personality: agreeableness, conscientiousness, emotional stability, extraversion, and openness to experience.

Testing - continued

Situational Judgment Testing – ask the job applicant what they would do, or should do in a hypothetical situation.
Physical Ability Testing -assesses muscular strength, cardiovascular endurance, and coordination.
Integrity Testing - are designed to assess the likelihood that applicants will be dishonest or engage in illegal activity.

Situational Judgment Tests ask the job applicant what they would do or should do in a hypothetical situation. Items can be written to assess job knowledge, cognitive ability or practical.
Physical ability testing assesses muscular strength, cardiovascular endurance, and coordination.
These tests are useful for predicting performance in many manual labor positions and in jobs that require physical strength. Physical ability tests can be particularly important in relation to the Americans with Disabilities Act, as organizations can be held liable for discrimination against disabled applicants.
In the past, some employers used polygraph—or lie detector—tests to screen out job applicants who might steal from them. However, the Employee Polygraph Protection Act of 1988 generally made it illegal to use polygraph tests for hiring decisions. Since then, organizations have increasingly turned to paper-and-pencil tests for integrity testing. Such tests are designed to assess the likelihood that applicants will be dishonest or engage in illegal activity.
There are two types of integrity test: overt and covert. Overt tests ask questions about attitudes toward theft and other illegal activities. Covert tests are more personality-based and seek to predict dishonesty by assessing attitudes and tendencies toward antisocial behaviors such as violence and substance abuse.

Testing - continued

Drug Testing - normally requires applicants to provide a urine sample that is tested for illegal substances.
Work Sample Testing (Assessment Center) -measures performance on some element of the job such as keyboarding.

Drug Testing requires applicants to provide a urine sample that is tested for illegal substances.

Work Sample Testing measures certain jobs which require specific skills such as programming, word processing or driving simulators.

Testing

Source: Sample items for Wonderlic Personnel Test-Revised (WPT-R). Reprinted with permission from Wonderlic, Inc.

Testing

Sources: Information from Timothy A. Judge, Daniel Heller, and Michael K. Mount, ‘‘Five-Factor Model of Personality and Job Satisfaction: A Meta-Analysis,’’ Journal of Applied Psychology 87 (2002): 530–541; Murray R. Barrrick, Michael K. Mount, and Timothy A. Judge, ‘‘Personality and Performance at the Beginning of the Millennium,’’ International Journal of Selection and Assessment 9 (2001): 9–30.

Testing

*1 5 never; 2 5 rarely; 3 5 occasionally; 4 5 often; 5 5 almost always

Higher scores thus represent more widespread usage.

Source: Information from Ann Marie Ryan, Lynn McFarland, Helen Baron, and Ron Page, ‘‘An International Look at Selection Practices: Nation and Culture as Explanations for Variability in Practice,’’ Personnel Psychology 52 (1999): 359–391.

Information Gathering

Common methods for gathering information include application forms and résumés, biographical data, and reference checking.
Application Forms and Résumés –Generally ask for information such as address and phone number, education, work experience, and special training.
At the professional-level, similar information is generally presented in résumés.

Many entry-level jobs require potential employees to complete an application form.
Application forms ask for information such as address and phone number, education, work experience, and special training.
For professional-level jobs, similar information is generally presented in résumés. Some organizations may ask for both an application and a resume.
The reliability and validity of these selection methods depends a great deal on the information being collected and evaluated.

Information Gathering - continued

Biographical data - historical events that have shaped a person’s behavior and identity.
Reference Checking - involves contacting an applicant’s previous employers, teachers, or friends to learn more about the applicant Issues with reference checking:
defamation of character, which occurs when something untrue and harmful is said about someone.
negligent hiring, occurs when an organization hires someone who harms another person and the organization could reasonably have determined that the employee was unfit.

Biographical data -involves asking questions about historical events that have shaped a person’s behavior and identity. Some questions seek information about early life experiences that are assumed to affect personality and values.

Please Note - Some human resource specialists express concern about legality and fairness issues with biodata. Much of the information collected involves things beyond the control of the person being evaluated for the job and is likely to have adverse impact for some.

Reference checking involves contacting an applicant’s previous employers, teachers, or friends to learn more about the applicant. Reference checking is one of the most common selection methods.
Reference checking raised some legal questions. Organizations can be held accountable for what they say about current or past employees. A bad reference can become the basis for a lawsuit claiming defamation of character, which occurs when something untrue and harmful is said about someone.
Many organizations adopt policies that allow managers and human resource specialists to provide only dates of employment and position.
negligent hiring, can occur when an organization hires someone who harms another person and the organization could reasonably have determined that the employee was unfit.

Interviewing

The interview is the most frequently used selection method.
Interviewing occurs when applicants respond to questions posed by a manager or some other organizational representative (interviewer).
Typical areas in which questions are posed include education, experience, knowledge of job procedures, mental ability, personality, communication ability, social skills.

The interview is the most frequently used selection method. Interviewing occurs when applicants respond to questions posed by a manager or some other organizational representative. Most interviews incorporate conversation between the interviewer and the applicant. The interview is useful not only for evaluating applicants but also for providing information to them and selling the organization as a desirable place to work.

Types of Interviews

Structured Interviews - uses a list of predetermined questions. All applicants are asked the same set questions. There are two types of structured interviews.
Situational interview, in which the interviewer asks questions about what the applicant would do in a hypothetical situation
Behavioral interview, in which the questions focus on the applicant’s behavior in past situations.

The typical interview is an unstructured interview in which a single rater asks a series of questions and then provides an overall recommendation on whether the person interviewed should be hired.
Structured interviews use a list of predetermined questions based on knowledge and skills that job analysis has identified as being critical for success. This assures that the questions are appropriate and that all applicants are asked the same questions.
In the situational interview, the interviewer asks questions about what the applicant would do in a hypothetical situation. In the behavioral interview, the questions focus on the applicant’s behavior in past situations.
Both types of interviews seek to have people discuss actions in a specific context and thus tend to generate responses that are good predictors of job performance.

Figure 6.4 Creating Structured Interview Questions

Types of Interviews-continued

Unstructured Interviews-open ended questions are used such as “Tell me about yourself”.
This allows the interviewer to probe and pose different sets of questions to different applicants.

No notes

Interviews

SELECTION DECISIONS

Decision can be made using one of the following methods.
Predictor Weighting - combines a set of selection scores into an overall score in which some measures count more than others.
Minimum Cutoff Approach – The applicant’s strength in one area to compensate for weakness in another area.

Predictor weighting allows an applicant’s strength in one area to compensate for weakness in another area. Someone with a low cognitive ability score might still be hired if interview and biodata scores are high.
Minimum cutoffs approach, requiring each applicant to have at least a minimum score on each selection method. An applicant who is very weak on any of the measures will not be hired.

In practice, many organizations use minimum cutoffs to identify a pool of people who meet at least minimum requirements in a number of areas. Once this pool of people is identified, then weighted predictors are used to make the final hiring decision.

Selection Decisions-continued

Multiple Hurdle Approach - applicants must meet the minimum requirement of one selection method before they can proceed to the next.
Banding Approach - uses statistical analysis to identify scores that may not be meaningfully different.

The multiple hurdles approach are thus multiple cutoffs applied in order, and applicants must meet the minimum requirement of one selection method before they can proceed to the next. A potential problem with this approach is that decision makers eliminate applicants without knowing how they would score on all the tests.
The banding approach uses statistical analysis to identify scores that may not be meaningfully different. People with such scores are placed into a common category, or band. Managers and selection specialists are then free to choose anyone of the applicants within the band.