Author

Xing-Xiu Zhuang

How Artificial Intelligence

and Digital Tools Help Submitted at
Companies in Strategic Institute of Strategic Management

Recruitment to Enhance
Their Competitiveness Thesis Supervisor
Mag.a Dr.in Sabine Reisinger

Linz, January 2021

Master’s Thesis
to confer the academic degree of
Master of Science
in the Master’s Program
General Management Double Degree STUST Tainan - JKU Linz

JOHANNES KEPLER

UNIVERSITY LINZ
Altenberger Straße 69
4040 Linz, Austria
jk
Statutory declaration

I hereby declare that the master thesis submitted is my own unaided work that I have

not used other than the sources indicated, and that all direct and indirect sources are

acknowledged as references.

This printed thesis is identical with the electronic version submitted.

Linz, January 2021

Signature

I
Executive Summary

Organizations have been undergoing fundamental changes in the nature of work, and

more importantly, in their recruiting procedures, triggered by the ever faster and

omnipresent digital evolution process (Ployhart, 2006). Key components of this process

are electronic recruitment tools, in particular social media recruiting and artificial

intelligence-based recruiting technologies (Black & van Esch, 2020). Tremendous

amounts of data are entailed by this digitization shift, the amount of which is so great

that humans are not capable of processing and interpreting them. Neither are hiring

managers of bigger organizations able to do so since they have to check dozens of

applications, which is especially time-consuming and, consequently, quite costly for

their companies. Besides these trends, there is a scarcity of workforce in some fields

like high-tech industries, IT and communication sectors, and many other branches (Saks,

2005). As a result, several employers and organizations are struggling with finding and

retaining talented employees with essential skills (Hanin, Stinglhamber, & Delobbe,

2013; Saks, 2005).

Based on the fact that talent is valuable, not easy to imitate or to substitute, and rare,

organizations that can better attract, recruit and retain talented candidates will probably

outperform those which are not able to do so (Ployhart, 2006). Adequate recruitment

has therefore become the main issue for numerous companies (Jarrahi, 2018; van Esch

& Black, 2019; Webber, Detjen, MacLean, & Thomas, 2019). It is vital for both

organizational survival and the achievement of competitive advantage (Ployhart, 2006).

With regard to the fact that such rare and skillful employees can have a positive effect

on organizational outcomes, it is of great importance for companies to find them before

II
competitors seduce them. One way to achieve this is to have a modern, efficient, digital

recruitment system which enables companies to cope with previously mentioned

challenges and tasks. There is, however, a little amount of academic research on this

issue which impedes a proper adaption of digital recruitment technologies. There is also

uncertainty about what effects such tools have on organizations and their performance

(Duan, Edwards, & Dwivedi, 2019).

Therefore, this master thesis aims to first find out what kinds of modern digital and

online tools and AI-supported technologies there are on the markets as well as how

organizations can take advantage of them within the scope of their recruiting activities.

Another important goal of this work is to gain a deeper understanding about how the

proper application of such tools should take place in order to facilitate organizational

competitiveness. Furthermore, another purpose of the thesis is the provision of a

foundation for further research on this issue. Instead of deeply analyzing every aspect

of the topic, a short but comprehensive overview is provided in the form of a literature

review, based on internationally acknowledged scientific articles. After an initial

introduction of a new general strategic recruitment system which is a necessary

prerequisite for the implementation of digital tools, the functionalities and advantages

of e-recruitment and AI-based recruiting technologies are subject of discussion. A

summary of the research findings with an outlook for further research can be found in

the closing chapter of the thesis.

It will be shown that e-recruitment technologies can revolutionize traditional, obsolete

recruiting activities of organizations. They have made recruitment procedures

significantly faster and easier which implicated a remarkable fall in human resource

management-related expenditures. By engaging in these technologies, organizations

III
can have an inconceivably great reach and address anyone, anywhere at any time.

Consequently, the active use of such digital recruitment-supporting tools increases the

likelihood of finding the best talented potential employees who have been found to

build key components for achieving competitive advantage. It will also be pointed out

that the efficient and effective use of such tools can only take place when those are

integrated into a strategically functioning fundamental recruiting system which takes

cross-level effects among different organizational levels into account. Proper

digitization of organizations´ recruitment systems can thus facilitate companies´

competitiveness.

Keywords: strategic recruitment management, digital recruiting, AI, AI-based

recruitment, social media recruiting,

IV
 Table of Content
1 Introduction ............................................................................................................ 1
1.1 Problem Statement ................................................................................. 1
1.2 Objectives of The Thesis........................................................................ 5
1.3 Research Method ................................................................................... 7
1.4 Structure and Content ............................................................................ 8
2 Recruitment .......................................................................................................... 11
2.1 Basics of Recruitment .......................................................................... 14
2.2 Competitive Advantage ........................................................................ 16
2.3 Strategic Recruitment........................................................................... 18
2.3.1 Definition ..................................................................................... 18
2.3.2 Strategic Recruitment Model ....................................................... 20
3 AI and Other Technologies in HRM .................................................................... 31
3.1 E-Recruitment ...................................................................................... 35
3.1.1 Employer Branding ...................................................................... 39
3.1.2 Social Media Recruitment............................................................ 41
3.2 Artificial Intelligence ........................................................................... 43
3.2.1 Definition of AI ............................................................................ 45
3.2.2 AI-Related Terms ......................................................................... 48
3.2.3 Together With or Without Humans .............................................. 51
3.2.4 AI in Recruitment Practice........................................................... 53
3.2.5 Biases of AI .................................................................................. 57
4 Advantages and Disadvantages of AI and Other Tools in HRM ......................... 60
4.1 Advantages of E-Recruitment .............................................................. 60
4.1.1 Advantages of Employer Branding .............................................. 66
4.1.2 Advantages of Social Media Recruitment ................................... 69
4.2 Advantages of AI ................................................................................. 71
4.3 Disadvantages of AI ............................................................................. 76
5 Conclusion ........................................................................................................... 79
5.1 Discussion ............................................................................................ 79
5.2 Research Findings ................................................................................ 87
5.3 Limitations and Research Outlook....................................................... 90
6 References ............................................................................................................ 91

V
List of Figures
Figure 1 Research Questions ......................................................................... 7
Figure 2 Strategic Recruitment Model ......................................................... 24

List of Tables
Table 1 Primary literature sources concerning the concept of recruitment.. 14
Table 2 Primary literature sources concerning the concept of AI and other
technologies in HRM ........................................................................... 35

VI
List of Abbreviation
AI ....................... Artificial intelligence
CV ...................... Curriculum Vitae
DBIS .................. Datenbank-Infosystem
e.g ....................... exempli gratia (for example)
EBSCO............... Elton Bryson Stephens Company
e-HRM ............... electronic human resource management, e-recruitment
et al ..................... et alia (and others)
etc ....................... Et Cetera
EZB .................... Elektronische Zeitschriftenbibliothek
HR ...................... Human Resources
HSR .................... Horizontal Strategic Recruitment
JKU .................... Johannes Kepler University
LISSS ................. Literature Search Support Service
p.......................... page
pp........................ pages
RBT .................... Rational Bias Theory
SHRM ................ Strategic Human Resource Management
SRC .................... Strategic Recruitment Climate
VHB ................... Verband der Hochschullehrer für Betriebswirtschaft e.V
VSR .................... Vertical Strategic Recruitment

VII
 1 Introduction

The first chapter aims to give a short introduction of what this master thesis is about in the

following way: at first, current problems and challenges in modern human resource

management, or more importantly in employee recruitment will be outlined. The following sub-

chapter presents the goals of this thesis. These goals are aimed at finding solutions for the stated

problems, or at least some of them. Then the applied research method will be explained in short.

To provide an overview over the entire work, the description of its structure and content will

close this chapter.

1.1 Problem Statement

Having entailed by the worldwide present digital evolution, several changes in the essence of

work and, consequently, in the structure of recruitment processes are expected to occur in this

century (Ployhart, 2006, pp. 868–869). Just to name a few, greater demand on employee skills

and qualifications at knowledge-based workplaces, widespread societal, cultural, demographic

and labor changes causing increasing shortages of qualified and suitable job candidates,

growingly diverse labor force and many more challenges. Saks (2005) and Hanin et al. (2013)

are of similar opinion since they also claim that numerous organizations are already struggling

with finding competent employees. Even nowadays there are labor shortages in high-tech

industries, in technical, communications and scientific positions, among other fields (Saks,

2005). As an example, Saks (2005) has mentioned that 80% of employers in the USA have

difficulties with attracting, recruiting and retaining employees with crucial competencies.

However, this is not only an American problem. This can be observed all around the globe,

more or less. Recruitment, and mainly adequate recruiting has thus become of fundamental

importance for several organizations due to the growing difficulty of finding, recruiting and

1
retaining valuable employees (Jarrahi, 2018; van Esch & Black, 2019; Webber et al., 2019).

Additionally, because the manner of recruiting affects the features and the quality of candidate

pools, recruitment has consequences for and effects on all the other human resource activities

(Saks, 2005), and more importantly, on organizational outcomes (Phillips & Gully, 2015).

Even though the previously mentioned problems already exist to a certain extent, still they

rather embody challenges for the near future. However, in some other fields of HRM, there is

urgent need for change in some current systems. For instance, in the obsolete traditional

recruiting systems. These are namely most of the time paper-based, enriched with several paper

forms, hand-written signatures, as well as internal and external communication processes made

in loop method throughout the entire hiring process (Lee, 2011, p. 230). Although traditional

recruitment procedures can still be effective in some branches, they are notably costly and

inadequate due to their long hiring cycle time, low advertisement coverage, very high costs per

employment and inappropriate applicant management (Lee, 2011, p. 230). What is more,

applicants are, in general, required to personally visit organizations where they want to apply

for jobs to submit applications in paper form and complete long pre-selection measures (Stone,

Lukaszewski, Stone-Romero, & Johnson, 2013, p. 51).

Problems can also emerge when job candidates lack insight into what a job they apply for

involves and how they will act and perform due to the lack of their first-hand experience.

Breaugh, Macan, and Grambow (2008, p. 54) use the term “lack of self-insight” for this

phenomenon which they say is often the case and leads to mismatches in person-job, as well as

in person-organization fits. Furthermore, it should also be taken into consideration that a certain

amount of applicants fake their stories, distort their responses and engage in impression

management. Firstly, this would impede the selection process of suitable candidates. Secondly,

choosing unsuitable job candidates is not beneficial for organizations from any aspect (Ployhart,

2
2006). A better targeting strategy could eliminate these problems though (Breaugh, Macan, &

Grambow, 2008, p. 54).

Hiring managers´ biased selection can constitute further problems. Research has shown that

once HR managers collect all the potential applications, no matter how interviews are structured,

applicants´ physical appearance and initial impressions influence interviewers´ ratings (Suen,

Chen, & Lu, 2019). When scanning resumes, recruiters´ own experience and judgment will

consciously or subconsciously influence the outcomes of job interviews (Suen et al., 2019).

Moreover, only when the necessary number of qualified candidates apply to organizations will

the selection be effective and financially balanced (Ployhart, 2006, pp. 869–870). In addition,

several companies also have difficulties with how to attract different labor force, based on

(Ployhart, 2006, pp. 869–870).

Although both organizational success and survival depend on recruitment, many organizational

decision makers, even some organizational academics cannot realize its value and its

importance (Ployhart, 2006, p. 892). This is incomprehensible because every single

organization in the world uses some kinds of staffing procedures and many of them probably

not optimally (Ployhart, 2006, p. 892). Due to the fact, however, that talent is, according to

Barney and Wright (1998), valuable, rare, not easy to imitate and difficult to substitute,

organizations that better attract, select and retain talented applicants will likely outperform

those that are incapable of doing so (Ployhart, 2006, p. 892).

The environment in which organizations operate has changed, too. It has been undergoing a

rapidly and continuously changing digitization process, the key components of which are e-

recruitment, social media recruiting and AI-based human resource activities (Black & van Esch,

2020, p. 216). Along came with this trend the incredible amounts of data generated every day,

3
the amount of which is so enormous that humans are not able to interpret and process it in a

timely manner. People obviously cannot keep pace with this immediate growth of information.

This is true for human resource practitioners, too, who are inundated with dozens of applications.

To cope with the screening of all the applications, hiring managers would need a lot of time or

a great bunch of people.

That is where artificial intelligence (AI) based recruiting technologies become center of

attention. They are thought to provide solution for such problems (Campbell, Sands, Ferraro,

Tsao, & Mavrommatis, 2020, p. 228). AI solutions have nowadays developed to a level at which

humans cannot any longer keep up with carrying out advanced quantitative, analytical and

computational tasks (Jarrahi, 2018, pp. 581–584). Consequently, if companies do not want to

employ a great bunch of HR recruiters who deal with large amounts of information, and thus

want to avoid having to pay the high personnel costs incurred, they are sooner or later compelled

to open towards AI-supported recruiting tools (van Esch & Black, 2019, p. 730). The problem

is, however, that there are only relatively few research articles dealing with how new generation

of AI techniques should be used in and what effects they have on organizations (Duan et al.,

2019, p. 64).

It should be noted that the thesis is based on the current state of academic research before the

COVID-19 pandemic. Therefore, this work is not aimed at finding out what HRM-related

consequences this pandemic crisis has triggered. Neither are potential solutions for the

emerging problems and circumstances provided. This could be subject to another study.

4
1.2 Objectives of The Thesis

It can be seen that there is a great variety of challenges and deficiencies in the field of human

resource management nowadays. Considering the fact that talented and knowledgeable

employees can support organizational continuation and have a positive effect on organizational

performance, it is of utmost importance for human resource managers, and especially for

organizations to find them. This requires a modern, up-to-date, well-functioning digital

recruitment system which is able to overcome the aforementioned challenges. The question is

thus which digital tools can facilitate recruiting activities and how to adapt them adequately.

In light of the previously described digital evolution companies are exposed to, two things are

assumed: first, even for an organizational survival is it necessary to keep steps with

technological development. Second, if beyond that companies also want to achieve competitive

advantage, they do not just have to modernize their IT and recruitment systems, they have to be

able to professionally use those in practice. To do so, companies first have to know what tools

there are on the markets, what those are used for, what they could additionally offer and how

companies could make advantage of them. Therefore, the main focus of this master thesis is on

how digital technologies and mainly artificial intelligence can provide help for organizations

with strategic recruiting and how the proper application of such tools could help companies

achieve competitive advantage.

On these grounds, this work is aimed at finding answers for two research questions in the

following way: first and foremost, by making companies which have not yet started to operate

any kind of e-recruitment technologies, nor artificial intelligence-based recruiting methods

familiar with these modern tools. These yet inexperienced organizations´ attention should be

drawn to the countless advantages such digital recruiting technologies can provide. Furthermore,

5
there are also companies having already engaged in some kind of modern recruiting solutions,

but which might have not enough knowledge about how to efficiently and effectively use those

in order to achieve desired outcomes. Therefore, the first research question is as follows: “What

digital and online recruitment tools and methods are there – with a main focus on the most

commonly used ones –, what can they offer and how can they facilitate organizations´

competitiveness?”. Due to the limited extent of this work, the goal is not to give a long, in-

depth description of these technologies, but rather a short, however, encompassing overview of

this issue. Instead of providing lexical knowledge, the aim, in the first place, is only to call

attention to the existence of such tools and their beneficial properties. The second research

question deals with the same topic from a more specific point of view. The focus there is only

on artificial intelligence-related aspects of modern, digital recruitment methods. This research

question is the following: “What kind of AI-based recruiting technologies are there, what do

they offer and how can they help organizations gain competitive advantage?”.

Lastly, another purpose of this work is to develop a deliberated research agenda and provide a

substantial foundation for further research. This is important because this thesis cannot cover

every aspect of this extensive issue. Some questions with regard to how exactly organizations

should use digital recruitment tools might still remain unrevealed even by the end of the thesis.

Further research should uncover such untapped potentials. And last but not least, by the end of

this work, answers to the posed research questions should be found and new knowledge should

be acquired.

6
 What digital and online recruitment tools and

methods are there – with a main focus on the

most commonly used ones –, what can they

offer and how can they facilitate

organizations´ competitiveness?

What kind of AI-based recruiting technologies

are there, what do they offer and how can they

help organizations gain competitive

advantage?

Figure 1 Research Questions

1.3 Research Method

The methodological approach of this master thesis is shortly outlined in this sub-chapter.

This thesis is based on the current state of research to answer the research questions and include

secondary data analysis of scientific literature resources such as scientific articles, books, and

empirical research studies that are used to examine the above-stated objectives. According to

Webster and Watson (2002), uncovered areas of a literature review require more attention from

researchers who provide a substantial foundation for further research and promote knowledge.

Johnston (2014, pp. 619–620) points out that collecting earlier data from a secondary data

analysis exploits and examines already existing data for a different purpose or a different

intention. The purpose of using secondary data analysis cannot only help identify the main

questions with a specific topic and assess the current research state (Webster & Watson, 2002,

7
pp. 13–21) but also utilize existing collected theoretical knowledge and data to resolve new

questions and develop new objectives (Johnston, 2014, pp. 619–620).

To ensure that the selected literature is trustful, a globally accepted peer-review platform, VHB

has been used which rates scientific literature based on their quality. The online data based on

the peer-reviewed platform VHB classifies academic literature into A+, A, B, C, and D

categories (Johnston, 2014).

After an initial overlook of essential literature about foundational definitions, keywords were

defined in order to find relevant scientific papers and empirical findings regarding the academic

literature service Google Scholar. The relevant keywords were artificial intelligence, digital

tools, e-recruitment, web-based recruitment, website recruitment, human resource recruitment,

company strategy, strategic recruitment, or hiring strategy. Due to the often limited access to

scientific papers in Google Scholar, most of the used scientific articles were found at the JKU

university platform for scientific papers, which provide EZB eJournals, LISSS, and DBIS

databases. Moreover, the databases contain a large amount of academic literature such as

Science Direct, Web of Science, EBSCO host, SAGE Journals Online, JSTOR, and WISO were

used to find relevant scientific papers for my research questions. As mentioned above, Google

Scholar only provides limited access to scientific articles. Therefore, databases licensed by JKU

were used to obtain the required scientific quality of the applied materials.

1.4 Structure and Content

This thesis consists of five chapters. The problem statement, the objectives of this work, the

research method, the structure and the content of this work can all be found in the first chapter

which is called introduction. The problem statement describes the problem that is aimed to be

8
solved within the scope of this paper. The sub-chapter after that contains the research questions

and the overall goal of my thesis. Additionally, the applied research method, the structure as

well as the content are also explained.

The main part of this thesis is organized as follows. The second and the third chapters provide

relevant historical, theoretical and technological background information. The second chapter

gives profound introduction of traditional and strategic recruitment processes and practices in

order to acquire knowledge about how recruitment takes place in organizations. In addition, a

more complex strategic recruitment model will be described to gain deeper understanding.

Besides the explanation of some AI-related definitions and the short introduction of the

historical development of AI, some further relevant digital tools and methods with a main focus

on e-recruitment, social media recruiting and employer branding will be illustrated in chapter

three.

The fourth chapter is devoted to the analysis of how these above-mentioned technological

means and artificial intelligence-based programs can be best combined with different HR

practices. It will be explained how organizations should apply and how they can benefit from

using these digital technologies. Basically, a combination of chapter two with chapter three with

a main focus on advantages will take place in chapter four, the goal of which is to find out how

the active, regular use of modern technology can enable organizations to gain competitive

advantage. Furthermore, some potential hazards of the general nature of these technologies – if

there is any – and disadvantages emerging from their improper application will also be referred

to in chapter three and four.

Based on the provided theoretical basis of strategic recruitment and artificial intelligence and

other digital equipment in chapter two and three, as well as the, to a certain extent, newly

attained further knowledge in chapter four, the main findings and the outcomes of this research

9
will be summarized in the final chapter, with the complement of an outlook for future research

in this field.

10
 2 Recruitment

Due to the fact that one main topic of my master thesis is about how artificial intelligence can

help companies with strategic recruitment to facilitate their competitiveness and sustainability,

it is of particular importance to first sufficiently understand what recruitment is and how it can

contribute to organizational success. Only a better, more profound understanding of the entire

recruitment process can enlighten the weaknesses and those points of the process where there

is need or, at least, potential for improvement. This is one of the goals of this thesis, to first

point out these yet inadequate areas and then to analyze how artificial intelligence and other

digital tools could provide help and solution.

Furthermore, according to van Esch and Black (2019, p. 729), human resource activities

constitute key elements of strategic businesses nowadays, contrary to the past when they had a

solely tactical function. Black and van Esch (2019, p. 729) argue that three main changes have

led to this fundamental transformation in HRM. Firstly, not anymore tangible but intangible

assets build the core of organizational competitive advantage, since they might make up around

80% or more of a company´s value. Secondly, this role of intangible assets has raised the

strategic importance of human capital. And finally, there is scarcity of talent on the manpower

markets (van Esch & Black, 2019, pp. 729–730). These trends also explain why the main focus

of this chapter is on strategic recruitment instead of its predecessor traditional version. In

addition, there are some technical terminologies mentioned and described in the strategic

recruitment model which are sometimes referred to in subsequent chapters in conjunction with

related topics. And lastly, it will be shown in subsequent paragraphs that modern digital

recruiting tools can only function efficiently and effectively if those are integrated into a

strategically oriented fundamental recruitment system. Because of all the above-mentioned

facts, the inclusion of this chapter with a concentration on strategic recruiting in this work is,

11
consequently, essential.

Therefore, the following chapter will give a comprehensive overview about recruitment in order

to provide a foundation for the research topic. In order to acquire this knowledge, relevant

definitions, descriptions and explanations of concepts like recruitment processes, traditional

and e-recruitment, challenges, as well as advantages concerning recruiting procedures and other

aspects, that can all occur in strategic human resource management, will be introduced in the

following subchapters. The difference between strategic recruitment and general recruitment

will be explained, too, in order to eliminate uncertainty about what distinguishes these two

terms.

The chapter is structured as follows: recruitment will be defined in the first place, then the

structure of a basic recruitment process will be introduced. To complete this topic, traditional

and modern recruitment practices will be discussed. Subsequently, I will deal with competitive

advantages and the resource-based view, in short, to demonstrate why recruitment is of

elementary significance from the perspective of organizational effectiveness. After having

understood what recruitment is, the differences between traditional and strategic recruitment

will be explained. In addition, the explanation of the concept strategic recruitment will be

supported with the demonstration of a comprehensive strategic recruitment model. Finally, to

bring a close to this chapter, different advantages and challenges embedded in the work of HRM

will be introduced from the perspective of recruiting activities.

The following Table 1 shows an overview of the most relevant scientific literature used in this

chapter, including their authors, key findings and, respectively, their journal rankings from VHB

online.

12
 Name of
Topic researcher, Title of research paper Key findings
Journal/Book
Breaugh and Starke Research on Employee 1. Point out the
(2000), Journal of Recruitment: So Many recruitment trend.
Management (A) Studies, So Many 2. Identify and attract
Remaining Questions potential employees.
Gully, Phillips, and Strategic recruitment: A Sum up previous
Basics of
Kim (2013), Oxford multilevel perspective. aspects and provide
recruitment
University Press the definition.
Ployhart (2006), Staffing in the 21st Using “stuffing” to
Journal of Century: New describe
Management (A) Challenges and Strategic organizations´ related
Opportunities topics.
Datta, Guthrie, and Human Resource The success of the
Wright (2005), Management and Labor competitive
Academy of Productivity: Does advantage.
Management Journal Industry Matter?
(A+)
Competitive
Delery and Roumpi Strategic human The elements of
advantage
(2017), Human resource management, resource-based view
Resource human capital and (RBV).
Management Journal competitive advantage:
(B) is the field going in
circles?
Delery and Shaw The strategic 1. The differences
(2001), John E. management of people between HRM and
Delery., Jason D. in work organizations: SHRM practice
Shaw. (Ed.) 2001 – Review, synthesis, and research.
The strategic extension 2. Level of analysis.
management of
Definition people
Gully et al. (2013), Strategic recruitment: A The meaning of
Oxford University multilevel perspective. “strategic”
Press recruitment.
Phillips and Gully Multilevel and Strategic Across level of
(2015), Journal of Recruiting: Where Have analysis.
Management (A) We Been, Where Can

13
 Name of
Topic researcher, Title of research paper Key findings
Journal/Book
We Go From Here?
Delery (1998), Issues of fit in strategic The suggestion of
Human Resource human resource managing HRM
Management management: systems.
Review (B) Implications for research
Gerhart (2007), C. Horizontal and vertical The effectiveness in
Ostroff & T. A. fit in human resource HRM.
Judge (Eds.), systems
Perspectives on
organizational fit
Strategic
Phillips and Gully Multilevel and Strategic 1. Provide a
Recruitment
(2015), Journal of Recruiting: Where Have comprehensive model
Model
Management (A) We Been, Where Can in SHRM.
We Go From Here? 2. Analyzing levels
and adjustment in both
horizontal and vertical
strategic recruitment.
Ployhart (2006), Staffing in the 21st The difficulty while
Journal of Century: New analyzing
Management (A) Challenges and Strategic organizations.
Opportunities

Table 1 Primary literature sources concerning the concept of recruitment

2.1 Basics of Recruitment

Recruitment-related topics have been explored since about the middle of the twentieth century

in form of literature reviews and books (e.g., Arvey & Campion, 1982; Banks et al., 2019;

Barrett & Oborn, 2013; Breaugh, 2008; Breaugh, Macan, & Grambow, 2008; Breaugh & Starke,

2000; Gully et al., 2013; Phillips & Gully, 2015) Additionally, many studies have also been

done on employee recruitment in the past decades and the attention devoted to this topic had

been continuously increasing (Breaugh, 2008, p. 103; Breaugh & Starke, 2000, p. 405). Despite

14
the fact that recruitment is a frequently used term, it is not easy to define (Breaugh & Starke,

2000). Bringing up all the definitions and aspects of the vast amount of literature dealing with

this issue would probably not be feasible in this work. Therefore, only some of the most related

perspectives of the topic recruitment will be outlined which have relevance for this thesis.

In this paragraph, the term recruitment will be explained with the help of some definitions.

Breaugh and Starke (2000), for example, construe recruitment as practices and activities

operated by organizations with the main aim of identifying and attracting potential employees.

This definition complies with Ployhart´s (2006) statement, according to whom the majority of

definitions formulated about recruitment mainly focus on organizations´ collective efforts to

identify, attract and influence the job decisions of potential knowledgeable job applicants. He

personally used the term “stuffing” instead of recruitment, and described the phenomenon as

the process of attraction, selection and retention of competent people so that organizational

objectives can be achieved. In a very similar way to these concepts, Taylor and Collins (2000)

also interpret recruitment (with reference to Barber (1998), another researcher of this topic) as

a bundle of activities carried on by organizations for the main purpose of identifying an aimed

group of job candidates, attracting and ultimately retaining them.

In their definition of recruitment Gully et al. (2013) also include the previously described

aspects of the term recruitment, however, they supplement the definition with further necessary

elements, without which the definition would probably not be complete. These new components

claim that recruitment is not only meant to influence whether job seekers apply for the opening

actions of organizations but also is it meant to influence whether a job offer is accepted and the

candidates join the organization. Furthermore, Gully et al. (2013) note that recruiting actions

can also help candidates who might not be a good fit to self-select out of the recruitment and

selection process.

15
2.2 Competitive Advantage

Datta et al. (2005) argue that success in today´s extremely competitive markets is more

dependent on innovation, speed and adaptability then on advantages associated with technology,

patents, access to capital and economies of scale. They also note that these former sources of

competitive advantage can mainly be originated from companies´ human resources. To better

understand which competencies, lead to competitive advantage, it is necessary to first define

the concept of the resource-based view. The resource-based view (RBV) is, according to Delery

and Roumpi (2017), obviously one of the most popular theoretical frameworks in the

management literature which suggests that valuable, rare, non-substitutable and imperfectly

imitable resources – which are those that cannot easily be mimicked, duplicated or replaced by

rival competitor companies (Delery & Shaw, 2001; Taylor & Collins, 2000; Wright & Snell,

1998) – can create and result in competitive advantage. In contrast to physical and technological

resources, value in terms of organizational performance by human resources might not be easy

to imitate and hence can be the key to advantage in organizations (Delery & Roumpi, 2017;

Delery & Shaw, 2001).

According to Delery and Shaw (2001), most of the academics agree that human capital can be

source of competitive advantage on the one hand, and that HRM activities directly influence

the human capital of companies on the other hand. Moreover, there is also acceptance that the

complex nature of a consistent HRM system of actions can enhance the inimitability of the

system (Bowen & Ostroff, 2004, p. 203; Delery & Roumpi, 2017; Delery & Shaw, 2001; Gully

et al., 2013). In other words, people are substantial and indispensable determinants of

organization-related outcomes like productivity and profitability (Delery & Shaw, 2001;

Phillips & Gully, 2015). A recruitment system that is deeply rooted in the entire organization

can better attract particular types of people who fit the business strategy which is a precious

16
resource that yields competitive advantage (Gully et al., 2013). Given the fact that talent is rare,

difficult to imitate and hard to substitute, organizations that better attract, select and retain

talents are likely to outperform those that do not attach importance to a profound, appropriate

recruiting system (Ployhart, 2006; Wright & Snell, 1998, p. 769).

However, if these potential employees are not effectively recruited, they cannot even be hired.

Thus, talented individuals cannot be selected, managed and further educated through human

resource management systems if they are not first recruited (Gully et al., 2013). Training,

educating, maintaining and engaging a qualified workforce is essential to the success of an

organization, and consequently, it is also one of the most crucial aims of human resource

management (HRM) (Tumasjan, Kunze, Bruch, & Welpe, 2019, p. 83). Based on all of these

arguments, several academics have emphasized the determinant importance of bigger company

investments in high-performance or high-involvement human resource systems (Datta et al.,

2005), since recruitment is itself what determines whether these unique, inimitable

characteristics which are crucial for organizational success and survival exist in a company

(Phillips & Gully, 2015, p. 1417).

By now, it has become clear in which way recruitment plays a determining role in the

achievement of competitive advantage, and consequently, in organizational success. For this

reason, it is important to include and explain competitive advantage in this work, without which

the significance of appropriate recruitment processes would be disregarded. In addition, the

procedure of strategic recruitment processes will be further enlightened for a deeper

understanding in the following chapter.

17
2.3 Strategic Recruitment

Recruitment activities can be a sustainable source of competitive advantage – as this also turned

out from previous paragraphs – but only when these activities are aligned with business goals

and integrated with other elements of HRM systems (Gully et al., 2013). This is, on the one

hand, because competitive advantage is incorporated in both the individual- and unit-level

characteristics which are used for strategic implementation (Phillips & Gully, 2015, p. 1417).

On the other hand, because of the fact that the main objective of strategic recruitment is to

ensure that organizations have the irreplaceable, knowledgeable, valuable people which are

necessary to achieve organizations´ strategic objectives (Gully et al., 2013; Hussain & Rafique,

2012; Phillips & Gully, 2015).

However, according to Phillips and Gully (2015, p. 1417), strategic recruitment is not equal to

traditional recruitment. For this reason, it is not enough to only understand how recruitment

works but also is it inevitable to know what strategic recruitment is. Therefore, in the following

paragraphs the term strategic recruitment will be defined and the difference between traditional

and strategic recruitment processes will be pointed out.

2.3.1 Definition
According to Gully et al. (2013), strategies constitute the long-term goals of companies, their

action plans, their way of working and their resource allocation needed to achieve these goals.

As explained by the authors, the additional word “strategic” in the term strategic recruitment

usually refers to company level strategies, the performance of companies and integrated HRM

systems. Indeed, human resource management practices can be “strategic” at various levels, as

well as across functions (Gully et al., 2013). As a matter of fact, Phillips and Gully (2015) are

of the opinion that recruitment can not only be strategic, but it should be, for the sake of

18
organizations´ success at least. They suggest that when recruitment is not strategic there might

not be sustainable sources of competitive advantage which can result in the downfall of a

company. But what exactly is the distinction between traditional and strategic recruitment?

Delery and Shaw (2001) argue that there are two main differences between strategic human

resource management and HRM practice research. One of these differences is that two integral

parts are included in the strategic nature of HR, that is, the fit between HR and business strategy

and the analysis of the impact of HR on firm performance. This direct merger of business

strategy and human resources management began approximately 40 years ago and nowadays it

is acknowledged by most of the SHRM academics that organizations´ business goals influence

the way they manage people (Delery & Shaw, 2001). The other considerable difference between

SHRM and traditional HRM is the level of analysis, which might be a natural consequence of

profit orientation according to Delery and Shaw (2001). In most cases, what is considered to be

SHRM research is either at organizational-, work- or business unit-level of analysis, rather than

at the individual-level (Delery & Shaw, 2001). Phillips and Gully (2015) claim that strategies

often entail firm-level effects connecting strategy, firm performance and HRM systems, leading

to a macro perspective on systems and practices. They also mention, however, that it has been

recognized that strategy and strategic execution are affected by both meso-level (team- and

business unit) and micro-level (individual) effects. By implication, strategic execution is a

combination of systems and processes across micro-, meso- and macro-levels (Phillips & Gully,

2015, p. 1420).

In conclusion, to formulate an encompassing definition of strategic management, it could be

said that strategic recruitment constitutes the allocation of resources, the creation of systems,

policy making and the engagement in organizational practices and actions – across levels of

analysis (Phillips & Gully, 2015) – which are adjusted to the strategic goals of organizations;

19
are tailored to HRM activities in other parts of organizations; call the attention of qualified job

applicants –who fit the job or the organization – to job opportunities; influence whether skillful

and educated candidates apply for these job offers; motivate unfit job seekers to self-select out

of the hiring process; influence whether best candidates endure in the position until a job offer

is prolonged; affect whether a job opening is accepted and applicants join the organization; raise

human capital available to facilitate strategic execution and finally, lead to favorable individual,

business unit and organizational outcomes (Gully et al., 2013).

2.3.2 Strategic Recruitment Model

The following two sub-chapters will give a deeper insight into the strategic recruitment model

of Phillips and Gully (2015) that was previously often referred to. After an initial introduction

of the necessity for strategically oriented recruitment systems which take multiple

organizational levels and cross-level effects into account, their model will be outlined more in

detail for a better understanding.

2.3.2.1 Introduction

Phillips and Gully (2015) point out that recruitment research has not yet entirely explored some

key methods which could facilitate and enhance sustained competitive advantage. This is

probably due to the fact that most of the researches have only analyzed either the overall general

HRM system used by an organization or the HRM system for only one particular job or a bunch

of jobs within a company (Delery, 1998). Another possible explanation for the existing research

gaps in this field (Ployhart, 2006) maybe a consequence of the fact that human resource

management has mainly examined how employment-related policy decisions have an effect on

organizational effectiveness, whereas effectiveness was almost always observed at the

individual-level of analysis only (Gerhart, 2007). Moreover, according to Colbert (2004),

20
several recruiting researchers have not succeeded to simultaneously analyze the effects of

multiple factors. Phillips and Gully (2015) and Han, Kang, Oh, Kehoe, and Lepak (2019) note,

too, that there is only little information about recruiting practices, systems and outcomes among

different levels.

Ployhart (2006) points out that organizations are hierarchical and nested by nature and due to

this complexity, the ignorance of such interlaced structures can lead to delusive interpretations

and generalizations of within-level research outcomes. Furthermore, Phillips and Gully (2015)

claim that research gaps have significantly negative consequences by their nature: they consist

of uncertainty about how macro- and meso-level recruiting techniques affect macro- and meso-

level outcomes, they fail to take the vital role of sourcing talents to be targeted in the recruiting

process into consideration and finally, they disregard how recruiting method effectiveness

differs across units.

There are some options to solve these problems emerging from such research gaps. For instance,

Delery (1998) recommends researchers the devotion of more attention to the levels of analysis

when assessing HRM methods. He argues that instead of averaging the application of practices

across a company – which measurement method may seem to unrealistically consider all

employee groups as equally important – the focus should be on HRM systems at the level of

the particular job in the company. In this manner, a more detailed insight into how organizations

can gain competitive advantage through people can be achieved (Delery, 1998). Delery (1998)

suggests that HRM systems should be analyzed throughout companies since these systems are

different within organizations. Another solution could be provided by multi-level recruitment

research and models (Ployhart, 2006).

21
To help address these problems, Phillips and Gully (2015) introduce their model as a theoretical

framework that coordinates and explains connections across relevant researches on strategic

recruitment with the aim of attempting to close these research gaps. By taking strategic

recruitment as a multi-level input-procedure-outcome system, their model helps describe the

key elements of strategic recruitment and demonstrates how recruitment systems, policies and

methods can be created which enhance individual, team and firm performance by identifying

levers at different organizational levels.

Phillips and Gully (2015, p. 1417) use different levels of analysis in their work to study how

strategic recruiting overlaps with HC, RBV and SHRM. Instead of broadly reviewing existing

recruiting work, the academics have collected ideas from a wide range of research of mainly

the last fifteen years with implications for recruitment, to explain how organizations can recruit

job seekers who best meet their needs and who facilitate business strategy implementation.

Additionally, in accordance with previously offered solutions for research deficiencies, Phillips

and Gully (2015) are also of the opinion that the effects of particular recruitment inputs and

practices should not be considered in isolation but rather the potential effects of any

recruitment-related factor should be observed within the context of entire organizational

systems. Therefore, in contrast to most of other strategic recruitment models, they use a multi-

level approach to emphasize how adjustment in recruitment inputs, processes and outcomes

within and across levels is a primary source of human capital and competitive advantage.

Consequently, a deeper insight into the general functioning of a strategic recruitment model can

be gained in the following paragraphs, based on the work of Phillips and Gully (2015), to better

understand the processes through which organizational strategy is most beneficially

transformed into team-level recruitment systems, practices, methods and policies and finally

into individual-level recruitment results. This is consistent with the concept of SHRM in which

22
human resource management is connected to the overall strategic intentions by aligning the

HRM roles with each other and, as a matter of course, with the business strategy (Phillips

& Gully, 2015).

2.3.2.2 Model Explanation

Phillips and Gully (2015, pp. 1419–1420) criticize that the fact that recruiting itself is

influenced in various ways by inputs and processes which differ at numerous organizational

levels, has not generally been addressed in much research. Therefore, they focus on three

distinguishable organizational levels which relate to strategic recruitment: the organizational

level which is the highest level of analysis and encompasses the organization as a whole unit;

the team level which includes the department and business units, working groups and teams;

and finally, the individual level which is the lowest level of analysis that consists of hiring

managers who implement the recruiting strategy and interact with applicants. The authors’

model is built upon the idea of input-process-outcome dynamics completed with feedback loops.

23
 Figure 2 Strategic Recruitment Model

Source: Phillips and Gully (2015, p. 1418)

As can also be seen in figure 2, each organizational level has a specific set of input factors

which have an effect on the recruitment systems, policies and activities executed at that level,

which again affect different kinds of recruiting outcomes.

Following Phillips and Gully (2015), the required talents for strategic execution should first be

defined by organizations and only afterwards can firms adjust their recruitment techniques

across and within organizational levels. Strategic implementation could thus be understood as

an integration of processes and systems across micro-, meso- and macro-levels. In other words,

from the point of view of Phillips and Gully (2015), strategic recruitment basically connects

recruiting activities across levels of analysis in thorough alignment with organizations´

objectives, strategies and characteristics. This alignment procedure consists of both vertical and

24
horizontal adjustment. What these two terms mean will be explained in the following

paragraphs, since they are the most elementary components of the strategic recruitment model

of Phillips and Gully (2015).

Han et al. (2019) suggest that fit is a basic approach of SHRM, whereby two different types of

fit can in general be distinguished which are vertical and horizontal fits. The former one can

also be called external fit and the latter one internal fit (Gerhart, 2007). Delery (1998) notes that

these two fits have been in the center of most researchers, too. Furthermore, these fits can be

adjusted or, in worse case, unadjusted both vertically and horizontally within and across levels

in organizations (Phillips & Gully, 2015). While vertical fit constitutes the extent of adjustment

between organizations´ HR and business strategies, horizontal fit is the extent to which the HR

practices of organizations´ are mutually adjusted or reinforcing (Han et al., 2019).

With the help of vertical adjustment, the overall strategic direction of organizations can be

maintained and reinforced by HRM strategies and activities (Delery, 1998; Wright & McMahan,

1992; Wright & Snell, 1998). Phillips and Gully (2015) further divide vertical adjustment into

a more specific form of fit in their model, the vertical strategic recruitment (VSR) (shown by

the vertical arrow on the right side of the model in figure 2), which is the vertical alignment of

recruiting input factors, processes and results across organizational levels. The most essential

difference between VSR and basic vertical adjustment is that vertical strategic recruitment is

about the adjustment of the subcomponents of the entire recruiting system by focusing on the

alignment of recruiting inputs, practices and outcomes across micro-, meso- and macro-levels,

while general vertical adjustment focuses on the HRM system as a whole and its connection to

the strategic management processes of organizations (Phillips & Gully, 2015). The key

components (input-, process and outcome-adjustment) of the notion of VSR are described as

follows:

25
 Input Adjustment

Phillips and Gully (2015) point out that recruiting strategies, goals and resources should be

compatible with the organizations’ strategies and those of certain business units and teams on

the one hand. On the other hand, they must be adjusted across different organizational levels to

be consistent and mutually strengthening. However, Phillips and Gully (2015) note, too, that in

case of inappropriate adjustment of firm-level input factors to those of the team-level, VSR

input factor misalignment can emerge. Furthermore, VSR must also be adjusted on systems,

policies and practices to obtain strategic recruitment in divers processes across levels (Phillips

& Gully, 2015, p. 1431).

Process Adjustment

According to Phillips and Gully (2015) the consistency of recruitment processes across different

organizational levels is called process alignment. Despite the fact that most research has not yet

examined whether process alignment have an effect on outcomes at any level, Phillips and Gully

(2015, p. 1432) note that it is reasonable to assume that indeed it does. However, assessing

whether a recruitment process exists at a given level is itself not sufficient enough based on

Phillips and Gully (2015). They suggest that the assessment of whether the intended process is

implemented at lower levels is as well necessary.

Outcome Adjustment

Phillips and Gully (2015, pp. 1432–1434) suggest that maximization of individual-level

recruitment results does not necessarily result in organizational effectiveness. Consequently,

based on the strategic recruitment model’s suggestion, organizational-level recruiting

effectiveness is affected by the adjustment of lower-level recruitment outcomes with

organizational-level needs and desired results. Phillips and Gully (2015, pp. 1432–1434)

believe that the strategic recruitment atmosphere is an essential connecting mechanism which

26
yields adjustment (or misadjustment) across levels, since it influences the transmission of

organizational inputs into the systems, policies and practices at the unit level which support the

business strategy. More importantly, the way how lower-level inputs, processes and outcomes

compile or compose themselves into higher-level manifestation of the recruiting system should

also be taken into consideration. Therefore, to gain better understanding about how recruitment

inputs and processes affect outcomes across different levels, every cross-level effect should be

analyzed more in detail.

Horizontal adjustment (shown in figure 2 as the diagonal arrow in the lower left), on the other

hand, constitutes the within-level congruity between recruitment systems and methods and

HRM systems and activities (Phillips & Gully, 2015). To put it differently, the internal

consistency and complementarity of HRM practices are addressed by horizontal fit (Delery,

1998; Wright & Snell, 1998). Just as in case of vertical fit, Phillips and Gully (2015) distinguish

horizontal strategic recruitment (HSR) – a sublevel of horizontal fit – from general horizontal

adjustment, whereby the alignment of recruiting input factors, processes and outcomes emerges

within a given level (Phillips & Gully, 2015). In their HSR, which can emerge at each

organizational level, the main emphasis is on enabling that the inputs are best utilized for the

recruitment actions to gain outcomes which facilitate competitive advantage and strategy

execution. The conceptions of HSR at each of the organizational level are described below:

Organizational level

Phillips and Gully (2015) argue that for the purpose of influencing firm-level recruitment results,

organizational-level inputs – consisting of resources, business strategy and culture – are

horizontally adjusted to several systems, policies and practices, including resource allocation,

policy setting and employer branding (Phillips & Gully, 2015). Recruiting systems at lower

organizational levels are affected by decisions made at this level. Vertical strategic recruitment

27
is thus driven by organizational-level HSR: Given the fact that lower-level strategic recruiting

systems and actions stem from higher-level decision making, strategic recruitment at

organizational level is necessary. To best execute HSR at the organizational level, since it

determines the input factor for and is the strategic foundation of strategic recruiting at lower

organizational levels, the maximization of HSR at the organizational level and the adjustment

of VSR across levels are vital for the effectiveness of the whole recruitment function (Phillips

& Gully, 2015, p. 1424).

Team level

Phillips and Gully (2015, p. 1426) suggest that input factors like a work unit, a team’s strategy,

culture, norms, leadership etc. at the team level of analysis influence their recruiting systems

and practices. Team-level recruiting methods have an effect on team diversity, strategic

execution, norms, retention, among other outcomes, in case the HSR is strong and horizontally

adjusted. Translation of firm-level business strategy and competitive advantage into the

recruiting and branding strategies takes place with the help of team-level strategic recruitment.

Team-level strategic recruitment atmosphere influences the recruiting actions that hiring

managers apply to attract and retain applicants in the hiring process. Phillips and Gully (2015)

also highlight that adjustment in the strategic climate across team members and leaders is

necessary, too. Attempts made to maximize person-job, person-team and person-organization

fits are such recruiting actions without which organizations’ successful strategy implementation

and maintenance of competitive advantages would fail to occur (Breaugh, Macan, & Grambow,

2008, p. 55; Phillips & Gully, 2015, pp. 1426–1428).

Individual level

According to Phillips and Gully (2015, p. 1428), individual-level recruitment outcomes are

influenced by the fact that there are differences between recruiters and hiring managers with

28
regard to knowledge, skills, experience and other characteristics like personality, which, of

course, affect how they apply and conduct different recruiting actions. Due to the fact that

applicant interactions take place at individual level, strategic recruiting at this level, too, is

important to organizations. It is important for organizations´ recruiting outcomes to understand

the way individual strategic recruitment should be horizontally aligned because of the relevance

of the interactions job applicants have with recruiters (Phillips & Gully, 2015). When there are

both VSR and HSR in individual-level recruitment, they imply higher job candidate trust and

attraction and lower turnover. Moreover, hiring managers represent their organization during

recruitment procedures, their behavior will thus affect recruiting outcomes (Phillips & Gully,

2015). Consequently, the role recruiters play should not be ignored. What is more, importance

should be attached to this fact and their field of competence in order to better benefit from HR

activities.

Phillips and Gully (2015) believe that there is a specific psychological climate in organizations

which connects recruitment systems vertically and horizontally across levels and drives VSR

and HSR, too. They call it the Strategic Recruitment Climate (SRC) which is a bunch of

cognitive perceptions of the recruitment behaviors, beliefs and values that are important to

particular teams and organizations. Phillips and Gully (2015) note that team strategic

recruitment is strong when employees within a business unit or work team share perceptions or

there is agreement among them on how to implement recruiting policies. And, accordingly,

when there is consensus among employees across particular organizations on the strategic

recruitment climate, then practices and strategies are consistently executed across both units

and employees within those units. Hence individual- and unit-level recruitment practices can

be driven by strategic recruitment climate (Phillips & Gully, 2015).

29
Bowen and Ostroff (2004) further point out that HRM activities can significantly influence

organizational climate perceptions. This is due to the fact that recruitment methods serve a

signaling function by sending messages that employees use to define the psychological meaning

of their working environment. Discrepancies in perceived SRC would result in misalignments

in sourcing, activities and outcomes. By implication, the responsibility of organizations,

according to Phillips and Gully (2015) should be the assurance that perceptions about the

meaning and purpose of recruitment are shared both horizontally from one department, team,

or HR function to another, and vertically from senior executives to recruiters.

Even though not much is known about the combination of strategies, their implementation

across different levels in organizations and their mutual effects on each other (Phillips & Gully,

2015; Ployhart, 2006), all in all, it can be said that the application of traditional recruitment

systems is not just not enough anymore, it is disadvantageous for companies. The ignorance of

cross-level effects and that of hierarchical structures leads to misinterpretation of within-level

research findings and can also cause misconception in a multi-level research (Ployhart, 2006).

With respect to efficient and effective recruiting, the main goal of which is the achievement of

competitive advantage, only a strategic recruiting system that takes cross-level effects into

account should be in use (Phillips & Gully, 2015), whereby companies should choose their

recruitment practices in alignment with their other particular organizational factors (Collins &

Han, 2004, p. 717).

30
 3 AI and Other Technologies in HRM

After having understood what recruitment is, and more importantly what strategic recruitment

is and how it can lead to competitive advantage, the focus should now be on its technological

aspects. In other words, it is also necessary to be aware of the basic features and functionalities

of artificial intelligence and other digital tools. To get closer to the goal of the thesis, there will

first be a brief introduction of the technological characteristics of e-recruitment and a more

detailed explanation of what artificial intelligence is. Subsequently, it will be analyzed how

these technologies can be implemented in recruiting processes of organizations. The structure

of the chapter is the following: in the beginning, the concept of e-recruitment will be outlined

where the main focus is on two of its most substantial manifestations, employer branding and

social media recruitment. Hereafter the scientifically more complex artificial intelligence will

be explained. The table below is a collection of the most important scientific literature included

in this chapter with the designation of their authors, their most important statements and their

journal rankings from VHB online.

Name of
Topic researcher, Title of research paper Key findings
Journal/Book
Lee (2011), Decision Modeling the benefit of 1. The expression of
Support Systems (B) e-recruiting process
“e-recruitment” (“e-
integration
HRM”).

2. Web based
E-Recruitment
technologies and

social networking.

Strohmeier and Organizational adoption 1. The adoption of e-

Kabst (2009), of e-HRM in Europe: An

31
 Name of
Topic researcher, Title of research paper Key findings
Journal/Book
Journal of empirical exploration of HRM.
Managerial major adoption factors
2. The use of e-HRM
Psychology (B)
in diverse areas.

Aaker (1996), Measuring Brand Equity The definition of

California Across Products and
employer branding.
Management Markets
Review (B)
Backhaus and Tikoo Conceptualizing and The outline of
(2004), Career researching employer
employer branding
Development branding
International (not process in three-steps.

ranked)
Collins and Han Exploring Applicant Both low- and high-
(2004), Personnel Pool Quantity and
Employer involvement
Psychology (A) Quality: The Effects of
Branding advertising.
Early Recruitment
Practice Strategies,
Corporate Advertising,
and Firm Reputation
Tumasjan et al. Linking employer The aim of employer
(2019), Human branding orientation and
branding.
Resource firm performance:
Management (B) Testing a dual mediation
route of recruitment
efficiency and positive
affective climate
Henderson (2018), They posted what? The usage and
Social Media Organizational Recruiter use of social
importance of social
Recruitment Dynamics (C) media for selection
media.

32
 Name of
Topic researcher, Title of research paper Key findings
Journal/Book
Kaplan and Haenlein Users of the world, The origin of social
(2010), Business unite! The challenges
media.
Horizons (C) and opportunities of
Social Media
Van Esch and Black Factors that influence The situation of using
(2019), Business new generation
social media
Horizons (C) candidates to engage
with and complete nowadays.

digital, AI-enabled
recruiting
Black and van Esch AI-enabled recruiting: AI in organizations is
(2020), Business What is it and how
equal to Digital
Horizons (C) should a manager use it?
Recruiting 3.0

Definition of AI Jarrahi (2018), Artificial intelligence AI consists of many

Business Horizons and the future of work:
systems which are
(C) Human-AI symbiosis in
organizational decision able to learn and think

making
Bolander (2019), What do we lose when 1. Machine can be
Journal of machines make
taught just like human
Management and decisions?
Governance (C) learn new skills.

2. The form of
AI-Related
machine learning
Terms
made up with

connectionist

paradigm and

symbolic paradigm

33
 Name of
Topic researcher, Title of research paper Key findings
Journal/Book
3. AI neuronal

networks are designed

to imitate human brain

especially neurons and

connections.

Campbell et al. From data to action: 1. Machine learning

(2020), Business How marketers can
need a huge amount of
Horizons (C) leverage AI
data.

2. Classifies data into

different level.

Dattner, Chamorro- The Legal and Ethical Big data follows

Premuzic, Implications of Using AI
people everywhere
Buchband, and in Hiring
Schettler (2019), online and collects

Harvard Business every kind of

Review (C)
information

Jarrahi (2018), Artificial intelligence What would AI bring

Together with Business Horizons and the future of work:
in both advantages
or without (C) Human-AI symbiosis in
humans organizational decision and disadvantage.

making
Black and van Esch AI-enabled recruiting: Adopt AI-based
AI in (2020), Business What is it and how
recruitment
Recruitment Horizons (C) should a manager use it?
technologies can be
Practice
divided into four

34
 Name of
Topic researcher, Title of research paper Key findings
Journal/Book
stages during the

recruitment process.

Van Esch and Black Factors that influence 1. The importance for
(2019), Business new generation
organizations to adjust
Horizons (C) candidates to engage
with and complete the language and

digital, AI-enabled wording.

recruiting
2. The usage of

detecting applicants.

Black and van Esch AI-enabled recruiting: Differentiate three

(2020), Business What is it and how
types of biases.
Horizons (C) should a manager use it?
García-Izquierdo, e-Recruitment, gender Rational Bias Theory
Ramos-Villagrasa, discrimination, and
which explains the
Biases of AI and Castaño (2015), organizational results of
Journal of Work and listed companies on the discrimination

Organizational Spanish Stock Exchange elements in some

Psychology (not
private and public
ranked)
companies.

Table 2 Primary literature sources concerning the concept of AI and other technologies in HRM

3.1 E-Recruitment

In the past, the attraction of a large number of job applicants may have been the main purpose

of recruitment in several organizations (Breaugh & Starke, 2000, p. 409). In contrast, in case of

jobs in professional occupations the most important goal was to attract higher educated, better

qualified job seekers (Campion, Campion, & Campion, 2019, p. 1089). Nowadays, however,

35
organizations in general which have their own human resource department are in search of new

recruitment methods and techniques to attract the best potential employees. As a result, it is

especially vital to share skills, resources, ideas, and to attract the right candidates for the sake

of an appropriate implementation of organizational processes (Bagheri Rad, Valmohammadi,

& Shayan, 2020, p. 517). Since people are using new methods to find jobs, it is essential to

adopt and apply new techniques, technologies and web-based tools for recruitment (Bagheri

Rad et al., 2020, p. 517).

One of the greatest advantages offered by the internet is the reduction of inefficiencies in the

marketplace by facilitating the information exchange between sellers and buyers (Maurer &

Liu, 2007, pp. 305–306). Almost every bigger recruiting company has adapted some kind of

web-based testing, and many have also changed from paper-based to internet-based selection

(Ployhart, 2006, pp. 881–882). Several surveys have been conducted to find out individuals´

and HR managers´ attitude towards recruiting online (Breaugh, 2008, pp. 113–114). Results

have shown that this staffing method is considered to be very effective (Breaugh, 2008, pp. 113–

114). It is therefore no wonder that the use of electronic human resource management (e-HRM)

has rapidly spread (Strohmeier & Kabst, 2009) among recruiters in probably every sector of the

economy as a major method for marketing jobs in this global labor market (Maurer & Liu, 2007,

pp. 305–306; van Eeden, 2014, p. 216).

If the expression “e-recruitment” (“e-HRM”) had to be defined, we could say that it is a hiring

process in which diverse electronic means and technologies are used to identify, attract and

select potential employees (Lee, 2011, p. 231). Or to put it differently, e-HRM can be

understood as the process of utilizing IT to interconnect and support different actors in their

common performing of human resource tasks (Strohmeier, 2007). Regarding its adoption, it is

generally accepted according to Strohmeier and Kabst (2009), that the implementation of e-

36
recruitment has to take place in a multi-level context, whereby organizational- and individual-

levels are distinguished and interaction effects between these levels are presumed. Although

besides e-HRM there are some similar terms, such as “virtual HRM” or “web-based HRM”,

these are just subareas of the electronic HRM concept (Strohmeier, 2007). Moreover, following

Maurer and Liu (2007, pp. 306-307), the term “e-recruitment” is not to mix up with virtual

recruiting environment which is an online environment that enables job applicants and

companies to interact with each other.

Additionally, e-recruitment is made up of web-based technologies which provide help for both

job applicants and recruiters with completing their tasks in a more efficient and effective

manner by automated staffing processes and the provision of information necessary for making

appropriate decisions (Lee, 2011, p. 231). Such technologies are for example career websites,

job search agents, applicant tracking systems, talent management systems, self-assessment tools,

candidate relationship management systems, HRXML, social media and so on. Besides these

technologies, the creation and maintenance of an own official website is also a good opportunity

for organizations to present job ads and further information about their company (Bagheri Rad

et al., 2020). Web 2.0 technologies like AJAX and RSS feeds make it possible for websites to

be simple, collaborative, interactive and informative (Lee, 2011, pp. 230–231). Other web

standards like HRXML and Web Services, too, can quickly be integrated into e-recruitment

tools (Lee, 2011, pp. 230–231).

E-recruitment is hence becoming more efficient with the integration of new technologies (Lee,

2011, pp. 230–231). This trend can be underpinned by a survey which has revealed that even

20 years ago over 90% of big U.S. companies maintained their own official recruiting websites

(Bagheri Rad et al., 2020). In the same period of time, every Fortune 100 companies used some

kind of e-recruiting methods. In addition, 94% of Global 500 companies used their websites for

37
staffing purposes (Maurer & Liu, 2007, pp. 305–306). It is probable that an increase in the use

of websites with regard to recruitment can be observed in the future, too (Breaugh, 2008,

pp. 113–114).

Furthermore, a special emphasis should be placed on social networking, a subarea of e-HRM,

that has been becoming a determinant part of overall organizational e-recruitment strategies

(Lee, 2011, pp. 230–231). According to Lee (2011, pp. 230–231), several organizations have

begun to benefit from online social networking, for instance Facebook, LinkedIn, MySpace

with the goal of attracting passive but qualified potential job applicants and reviewing

information posted by those. Lee (2011, pp. 230–231) also notes that there is a huge potential

for employees in utilizing such electronic referral systems to raise public awareness and that of

acquaintances and professional communities of newly available job opportunities. One kind of

such recruiting-related social networking tool are job boards, the aim of which is to utilize

network externality (Lee, 2011, pp. 230–231). Because the more these job boards exceed the

network of job candidates and recruiters, the more chance there is of having a job-applicant

match, due to the larger candidate pool (Lee, 2011, pp. 230–231).

To sum up, we can see that e-recruitment tools reach much further than does traditional

recruiting and they made the job application more simple, faster and easier (Lee, 2011, pp. 230–

231). According to Strohmeier and Kabst (2009), e-recruiting leads to profitable changes in

recruitment processes and it should therefore be a significant development in the field of human

resource management. Incidentally, there are a lot of relevant technological means, however,

due to the narrowness of my work I cannot give a detailed description of all of them. The focus

is on social media and employer branding, particularly because most of the unmentioned tools

belong to one of these categories and my aim is to just give an encompassing overview of the

most important and most determining concepts. These two notions will be presented below in

38
the following paragraphs.

3.1.1 Employer Branding

The term “employer branding” sounds like as if it was a marketing activity or method. As a

matter of fact, it is. According to Aaker (1996), employer branding could be defined as paid

messages communicated through different media technologies constructed to influence

consumers´ perceptions of an organization and its products (or services) and their willingness

to purchase those products. Many organizations invest great amounts of money in this kind of

self-advertising to build profitable, positive image about their company in consumers´ minds

(Collins & Han, 2004, p. 696). According to Collins and Han (2004, p. 696), research has

proven the remarkably positive role these investments played in influencing the attitude of

consumers towards organizations and their products for the benefit of those companies.

However, employer branding can to a certain extent also be used for the purpose of applicant

recruiting in HRM (Backhaus & Tikoo, 2004) and the focus here is on this aspect. Ambler and

Barrow (1996) have conceptualized the phenomenon as the use of brand marketing principles

to improve core HR outcomes like recruitment efficiency, current employees´ commitment,

candidate attraction and many more, to improve firm performance. Backhaus and Tikoo (2004)

outline a three-step process of employer branding: first and foremost, organizations deal with

the development of a unique employer value proposition, just like leadership style,

organizational culture or employer benefits, the goal of which is the representation of these

companies´ values offered to their employees. In the following two steps it is about the

marketing of these value propositions to potential future employees, in order to attract them.

Accordingly, the aim of employer branding – from both HR and marketing perspectives – is the

presentation of employment experience as attractive as possible and also the differentiation

from other organizations and the promotion of the unique proposition both internally (within
39
the company) and externally (labor market) to enhance crucial human resource outcomes and

consequently, to improve firm performance (Tumasjan et al., 2019, pp. 84–85).

Ployhart (2006, pp. 871-872) and Saks (2005) argue that employer branding is very important

for companies, as this has also been proven by research, because employer image has influential

effects on recruitment outcomes. Furthermore, image branding is particularly important in the

early stages of setting up companies, when there is only a little to know about them (Collins &

Stevens, 2002; Ployhart, 2006, pp. 871–872). Another concern that has to be taken into account

is the type of advertisement, since there exist several possibilities which all have different

effects on final firm outcomes (Breaugh, 2008, pp. 112–113). In this regard, two main kinds of

advertisements (or marketing activities) can basically be distinguished: low- and high-

involvement advertising (Collins & Han, 2004, pp. 690–691).

According to Collins and Han (2004, pp. 690–691), consumers can be influenced by low-

involvement advertisements even when they do not actively search for or put any effort into

looking for something. Low-involvement advertising hence affects consumers in an incidental

way, while those are carrying out other activities (Collins & Han, 2004, pp. 690–691).

Moreover, these kinds of advertisements do not contain much information in general, and can

be processed with either little effort or subconsciously (Collins & Han, 2004, pp. 690–691).

General recruitment ads are one example for a low-involvement recruiting strategy which are

capable of raising public awareness of organizations as employers and can transmit positive

image to individuals looking for jobs through pictures and logos for example (Martinez, 2000).

These ads can be placed in newspapers, websites, recruitment posters among other platforms

(Martinez, 2000).

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However, low-involvement ads are not sufficient alone for a successful awareness raising. From

the moment awareness has been gained, low-involvement techniques will no longer

considerably affect people (Cable & Turban, 2001; Petty & Cacioppo, op. 1986, pp. 147–178).

Once job candidates are aware of an organization and maybe also have positive perceptions

about it, low-involvement advertisements will be neglected (Cable & Turban, 2001; Collins

& Han, 2004). According to Collins and Han (2004, pp. 700–701), this is because these low-

involvement ads do not provide any additional information over what the candidates have

already stored in their minds. From this point, only high-involvement ads can provide solution,

which offer further, and more specific information related to particular organizations.

Black and van Esch (2020, p. 219) recommend organizations to be as extensive as possible

concerning their branding activities because only so can they address the best talented

prospective employees. One should note though that there are three times more passive potential

candidates than active job seekers. They, too, should be attracted since many of them would

consider and some would also accept a proper job opportunity if it was offered to them (Black

& van Esch, 2020, p. 219). One of the best possibilities for employer branding is the presence

on different kinds of social networking sites from blog sites through Twitter and Facebook to

Instagram and several others. In this manner, organizations can get in touch with both passive

and active job seekers, depending on the nature of the platform (van Eeden, 2014, p. 216).

3.1.2 Social Media Recruitment

After the brief introduction of the promising nature of social media recruitment, which is a

subarea of e-recruiting, the concept should now be discussed a bit more in detail. According to

Kaplan and Haenlein (2010), the foundation of social media dates back to the very beginning

of the 1960s when the first social networking website, called “Open Diary” was created with

the purpose of providing diary writers an online community. There are numerous types of social
41
media solutions (Kaplan & Haenlein, 2010), of course, but the general term can be defined as

internet-based applications which enable the creation and swap of user generated content, with

the help of Web 2.0 technology (Kaplan & Haenlein, 2010). Broadly speaking, social media

tools are applications which allow the public communication of people (van Eeden, 2014,

pp. 213–214). If we just think of people´s daily activities like, using Facebook to keep in touch

with friends and relatives, using Twitter for sharing news with the world, LinkedIn for

professional purposes, Google Hangouts which facilitates group teleconference for users all

around the world, smart phones and many other tools, it is obvious how fundamentally social

media has changed people´s lives in terms of human relations (van Eeden, 2014, pp. 214–215).

Not only are there social media platforms for individuals to nurture relationships. This

technology can also be used by organizations to advertise their products, establish their brand,

develop customer service or, more importantly, to manage own human relations (Henderson,

2018, pp. 1–2). In the course of the last decades, more and more organizations have engaged in

online social media sites like Facebook or LinkedIn to recruit job seekers. Nowadays social

networking is becoming a key element of organizational e-recruitment strategy which is also a

useful way of reviewing information posted by job applicants (Bagheri Rad et al., 2020, p. 519;

Lee, 2011, pp. 230–232; Roth, Bobko, van Iddekinge, & Thatcher, 2016). The good thing about

social media recruitment is its versatile applicability throughout different phases of recruiting

processes, from the recruitment of candidates through detecting and connecting them to

monitoring (Henderson, 2018, pp. 1–2).

However, what else could better prove the widespread use and the popularity of social

networking among organizations than facts and statistics. According to a survey of

CareerBuilder – an employment website – the use of social media for the purpose of recruiting

job candidates has increased 500% over the last decade (Henderson, 2018, pp. 1–2). Similarly,

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Roth et al. (2016) reported that 45% of 2.600 hiring managers in the US looked for information

about candidates on social media platforms. In addition, they did that already a decade ago.

Furthermore, if we consider the fact that there are more than half a billion LinkedIn and around

2 billion Facebook users worldwide, we can imagine how tremendous influence this can have

on the number of candidates and how significantly social networking has changed the nature of

recruitment (Henderson, 2018, pp. 1–2).

Van Esch and Black (2019, pp. 730–732) note that young people in general, and more

importantly job seekers regularly spend a lot of time on online social media websites, in average

more than 6,5 hours per week. Van Esch and Black (2019, pp. 730–732) also argue that the

more often people use a certain technology, the more they feel like doing other activities via the

same technology. Consequently, if organizations want to attract potential employees who spend

most of their time online, they, too, have to go online and start to use social networking tools.

3.2 Artificial Intelligence

In the course of the last decade the use of terms like big data, machine learning, and more

particularly, AI (artificial intelligence) has become more and more common (Duan et al., 2019,

pp. 65–67). More than half a century ago one of the prominent founder of AI, John McCarthy,

conceptualized artificial intelligence as the science of creating intelligent machines, in

particular computer programs. But what matters is that it is always somehow related to building

computers or machines which can complete tasks that only humans would be able to, such as

driving cars, playing chess, making conversations etc. (Bolander, 2019). It is probably not any

more possible in a timely manner for humans to process and interpret the unprecedented amount

of data generated day by day. That is exactly what AI is supposed to help with (Campbell et al.,

2020, p. 228). A wide range of industries are affected by artificial intelligence from health care

43
through marketing management to car industry and the development of this technology is

expected to keep growing (Campbell et al., 2020, p. 228). AI solutions have nowadays

developed to a level at which humans cannot any longer keep steps in carrying out advanced

quantitative, analytical and computational tasks (Jarrahi, 2018, pp. 581–584). It is therefore no

wonder that the notion of AI has become so widespread lately, it has literally interwoven our

lives.

However, not only the aforementioned areas of life are affected by this technology. The way

how organizations recruit individuals has changed, too. Organizations nowadays operate in

times of the so called “Digital Recruiting 3.0” where the emphasis is on the usage of AI-

supported recruitment methods (Black & van Esch, 2020, p. 216). Based on academic research

and organizations´ experiences, it has been shown that recruiting efficiency – mainly in the

early stages of recruiting (van Esch & Black, 2019, p. 730) – are remarkably improved by AI-

supported means (Black & van Esch, 2020, p. 222). Among other things, AI has the ability to

attract, screen and interview job applicants in a much faster and more effective manner than

humans could ever do, and can do that with tremendous amounts of data (Black & van Esch,

2020, p. 216). This procedure of the digitization of job information has led to a significant

decline in expenses on placement processes on the one hand, and to a considerable increase in

the number of job candidates per position on the other hand (van Esch & Black, 2019, p. 730).

Consequently, if companies do not want to employ a great bunch of HR recruiters who deal

with this amount of information, and thus want to avoid having to pay the great personnel costs

incurred, they are sooner or later compelled to open towards AI-supported recruiting tools (van

Esch & Black, 2019, p. 730). Due to the limited academic research articles dealing with how

new generation of AI techniques should be used and what effects they have on organizations

(Duan et al., 2019, p. 64), and in order to understand how AI can be advantageous for companies,

44
we should first understand the functionalities and the nature of artificial intelligence. For this

purpose, this chapter will first define what is meant by the term AI and give a very brief

introduction of its historical development. Then terms and theories which are all strongly related

to AI or are often erroneously mixed up with the term AI, will be explained. Subsequently, a

contemplation about whether AI should replace humans or it should just support them in

decision making processes, can be found. The chapter is concluded with a discussion of the use

of AI in HRM in order to also encourage companies with real-life examples to open towards

this exceptionally advantageous technology.

3.2.1 Definition of AI
After having mentioned the term AI so many times in previous paragraphs, it is now time to

properly define the concept. However, there is no uniform definition of artificial intelligence

but rather different explanations of the phenomenon (Bolander, 2019, p. 850; Chamorro-

Premuzic, Polli, & Dattner, 2019, p. 3; Duan et al., 2019, p. 63) and therefore, there is also

uncertainty about its capabilities (Chamorro-Premuzic et al., 2019, p. 3). Apparently the term

AI was first publicly mentioned in the 1950s according to Duan et al. (2019, p. 63). Basically,

machines´ ability to learn from experience and carry out tasks that usually humans complete is

meant by artificial intelligence (Campbell et al., 2020, p. 229; Duan et al., 2019, p. 63). In other

words, AI constitutes intelligent systems which are able to learn and think (Jarrahi, 2018,

pp. 577–578) and provide with guidance and advice on the basis of complex knowledge

(Webber et al., 2019, p. 742). Since AI is used in numerous areas of life (Duan et al., 2019,

p. 67), there are several different modifications of this technology (Jarrahi, 2018, pp. 577–578).

As a result, various terms are in use to describe artificial intelligence, from knowledge-based

systems through intelligent decision support systems to intelligent executive systems (Duan et

al., 2019, p. 67), just to mention a few. AI is made up of a diverse group of algorithms,

techniques and tools. Such techniques are, for example, neural networks, genetic algorithms,
45
deep learning, natural language processing, pattern recognition or machine learning (Jarrahi,

2018, pp. 577–578). Depending on what purpose these AI machines were programmed for, they

can drive cars, play chess, make conversations or diagnosis of different diseases. But all these

tools require specific programming aligned with the particular application according to

Bolander (2019, p. 850).

Furthermore, AI has not just happened to organizations. On the contrary, the use of AI-

supported tools and their spread was an integrated and substantial part of companies´ digital

transformation process (Brock & Wangenheim, 2019, pp. 114–115). Two of the most important

antecedents of this digitization process which have preceded the application of AI in

organizational recruitment – which is equal to Digital Recruiting 3.0 – should be mentioned:

the first improvement was the relatively fast growth in the number of job applications per

position across online job boards. The major advantage of this is that applicants do not anymore

need to personally visit companies for jobs, they could apply for jobs online. Similarly, firms

are also able to directly target individuals which they find potential, instead of addressing every

single applicant. This can extremely reduce costs and time from both the perspective of

employers and employees. The second big achievement was the emergence of the nowadays

worldwide used digital professional and social network platforms. One of the most popular and

most widely used professional network websites is LinkedIn, the goal of which is the creation

of occupational networks, professional interest groups and both the giving and receiving of

affirmations to and from people in these networks. These two determining stages in the

development process of digital recruiting form the basis of the emergence of AI-supported

recruitment (Black & van Esch, 2020, pp. 217–218).

These days, the adoption of deep learning has upgraded AI to a higher level at which computer

programs are able to learn from raw information and expand their own knowledge by

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incorporating bigger data sets (Jarrahi, 2018, p. 581). Due to the fast development of Big Data

technologies, or to put it differently, super high-speed of data processing machines and extreme

computing storage capacities and abilities, AI tools have been undergoing favorable changes

lately (Duan et al., 2019, p. 63). In these times, it is not possible for humans to keep steps with

the unprecedented advancement of technology. They are just not able to cope with the

processing of enormous amounts of information in a timely manner. These changes have led AI

machines to take part in and support complex decision making processes (Jarrahi, 2018,

pp. 578–581). Artificial intelligence enables efficient automated and interconnected business

processes which have considerable effects on several business functionalities (Campbell et al.,

2020, p. 228).

These trends in AI are also often subject of discussions made by AI programmers and big

organizations. For instance, a survey of 250 executives who are all sufficiently aware of their

organization´s technological functionalities has shown that approximately 75% of them believe

that AI will fundamentally change their organizations within three years (Duan et al., 2019,

pp. 67–68). In contrast, there are also some companies which are not yet – if ever – convinced

about whether or how their firms could make benefits of AI technology (Campbell et al., 2020,

p. 228). One thing is however clear: both AI in general and that in recruitment is only expected

to grow (Black & van Esch, 2020, p. 224; Campbell et al., 2020, pp. 228–229). So, the

following paragraphs and chapters serve the purpose of finding out the real nature of AI-driven

tools from an organizational perspective, so that companies, and especially human resource

managements can maintain competitiveness and benefit from the proper use of AI or, as the

case may be, from the exclusion of it.

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3.2.2 AI-Related Terms
Not only the term AI but some other related and similar definitions like data mining or machine

learning have become more popular during the last decade. Although it is not easy to define

what artificial intelligence itself and related designations are, and their meaning is constantly

changing, to a certain extent, (Duan et al., 2019), still this sub-chapter is aimed at defining some

of the most commonly used and important terms. This clarification is indispensable for the

avoidance of possible future misunderstandings, as well as for a better understanding of this

work. The following terms are described subsequently, in short: machine learning, neural

networks, deep learning and big data.

3.2.2.1 Machine Learning

Humans do not have an inborn talent for performing tasks, but they have the ability to learn

them. In a similar way to humans, machines can be taught as well. Following Bolander (2019,

pp. 853-854), any algorithm without static behavior that is capable of learning from experience

could be defined as machine learning. Machine learning could be software, for example, which

carry out tasks without predefined orders, or algorithms recognizing patterns and providing

forecasts and advice by processing the particular data (Campbell et al., 2020, p. 229) or even

algorithms with skills to learn better strategies in chess or the rules of new games (Bolander,

2019, pp. 853–854). Machine learning is thus a mean for exploiting huge amounts of data that

give support to the operating principles of everything AI tools can offer, based on Campbell et

al. (2020, p. 229). Machine learning is used in numerous applications which are part of

everyday life of modern generations ranging from content filtering on social networks through

speech recognition to e-commerce suggestion systems (Campbell et al., 2020, p. 229). Another

essential aspect of machine learning is that its algorithms can never function correctly if the

data these are trained on is erroneous. If this was the case, the algorithm will learn the wrong

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data source and, as a result, always reproduce the mistakes in its decision making process

(Bolander, 2019, pp. 860–861). Some machine learning techniques form part of the

connectionist paradigm, some are part of the symbolic paradigm. These expressions are

principally AI methods based on (artificial) neural networks (Bolander, 2019, pp. 853–854).

But what this terminology means, will be explained below.

3.2.2.2 Neural Networks

Neural networks, or rather artificial neural networks are designed to imitate the functionalities

of human brain (Bolander, 2019, pp. 854–855; Duan et al., 2019, p. 65), in particular neurons

and their connections (Bolander, 2019, pp. 854–855). Neural networks subdivide problems into

smaller elements which are then recurrently solved by building up on the findings of preceding

phases (Campbell et al., 2020, p. 229). According to Bolander (2019, pp. 854-855), two views

can be differentiated here: the rather bottom-up functioning connectionist AI and the rather top-

down working symbolic AI. While models are more explicit than implicit and can simply be

monitored and changed in the latter concept, systems in the former conception have a versatile

intelligence and are able to statistically learn from experience (Bolander, 2019, pp. 854-855).

Bolander (2019, pp. 854-855) argues furthermore that image recognition software in health care

or on Instagram are, for example, based on connectionist AI. Although competencies in

correctly classifying objects are permanently improving, statistically learning from experience

is never free from errors and can never become completely calculable, he says. In a similar

manner to humans´ problem solving system – in which a combination of explicit and implicit

way of thinking takes place – and due to constant disagreements and opposing views about

which approach is more meaningful, attempts at creating AI systems that integrate both

symbolic and connectionist elements can be observed in recent years (Bolander, 2019, pp. 854–

855). One of the most famous examples of such a combined AI system is Google DeepMind

that by itself has – among other achievements – built a system that has become the world
49
champion in the game of Go (Bolander, 2019, pp. 854–855). In addition, even household robots

and driverless cars are further examples of real-life applications of collaborating approaches as

explained by Bolander (2019, pp. 854–855).

3.2.2.3 Deep Learning

Deep learning constitutes another important subgroup of machine learning which has

substantially contributed to the enhancement of AI and its performance upgrade through an

ongoing learning process that had been a hindering factor for further development of AI in the

past (Duan et al., 2019, p. 68). The definition stands for a specific form of neural networks that

gains understanding by gradually forming more notional versions of a data group. This is made

by the division of data groups into divers levels of abstraction or conversion with a subsequent

search for patterns, firstly, within each level and, secondly, among these levels (Campbell et al.,

2020, p. 229). Lately, deep learning has brought AI to a more advanced higher level (Jarrahi,

2018, p. 581).

3.2.2.4 Big Data

Big Data is a nowadays often used fashionable word that stands for an incredibly huge amount

of structured or unstructured, complex data that not even standardized statistical software nor

traditional databases are able to process, analyze or interpret (Singh, Firdaus, & Sharma, 2015,

p. 135; Snijders, Matzat, & Reips, 2012, p. 1). The dissemination of mobile communication has

created a more than ever interconnected, networked world that consequently also facilitates the

availability and access to such enormous data sets (Snijders et al., 2012, p. 1). The data

analyzing tools which were used for managing data do not have the capacity for processing big

data in real time (Singh et al., 2015, p. 135). Furthermore, the existence of Big Data makes the

use of AI technologies reasonable, since humans are not able to process this amount of

50
information in a timely manner, especially because the amount of data will just continuously

keep growing (Dattner et al., 2019). However, AI is not the only way in which humans can

make use of Big Data (Duan et al., 2019, p. 69).

3.2.3 Together With or Without Humans

This short chapter is intended to put the spotlight on different aspects, potential advantages and

possible hazards of either the sole application and inclusion of AI tools in decision making

processes with the total exclusion of human activities, or on those of systems in which humans

and AI mutually support each other. This sub-chapter has two main objectives: first and

foremost, to get an indeed simplified, yet holistic view of artificial intelligence necessary for a

better understanding of the whole thesis. Secondly, hopefully this chapter, too, has implications

for one of the research questions, that is, how to use AI and other digital tools in human resource

management to enhance organizations´ competitiveness. Although each chapter provides

implications more or less, this sub-chapter delivers more concrete recommendations.

As noted in previous paragraphs, today´s AI can undoubtedly outperform humans in complex,

and more particularly in advanced computational, analytical and computational tasks (Jarrahi,

2018, p. 581). Interrelated with this, the demand for analyzing the role of AI technologies of

whether they should constitute a standalone mean in decision making, free from any human

intervention or they should only be used as assisting tools for human decision-makers, has

noticeably risen. Furthermore, according to Duan et al. (2019, pp. 67–68), some researchers

have suggested further roles AI-based systems could fulfill, which are criticism, expert

consultant, second opinion, automation and tutor. However, independent of the role AI systems

would play in organizations´ lives, there are opposing views about the extent to which AI should

be integrated in substantial organizational processes (Duan et al., 2019, pp. 67–68).

51
It is sensible to first take a closer look at both the strengths and weaknesses of each party and

afterwards to conclude. Jarrahi (2018, pp. 579–584) for example argues that humans are better

at judging and assessing qualitative, rather subjective than objective issues like intangible

political interest, social factors or norms, than is AI. This is because, contrary to humans, AI-

based systems do not possess either intuitive thinking processes, past experience or

subconsciousness, the composition of which enables human beings to outperform machines in

“big-picture thinking”, mainly when it comes to doubtful situations, he says. According to him,

only humans can strategically understand the below-the-surface functionalities of specific

things and because of all these personality features will humans remain superiors in intuitive

decision making (Jarrahi, 2018, pp. 579–584). Especially when companies encounter

ambiguous, obscure situations they have never experienced before, can this intuitive way of

decision making be useful (Jarrahi, 2018, pp. 579–584). These intuitive proceeding of humans

make them able to more likely evaluate and predict what variables will have bigger effects on

future outcomes. As a result, they can make recommendations on which factors to put emphasis

on in the course of data gathering and analysis which will form the basis for subsequently

applied smart technologies (Jarrahi, 2018, pp. 579–584).

Unlike in case of intuitive decision making where humans outperform machines, AI-based tools

can much better provide support when there are analytical tasks to be solved. In addition, the

reason for AI being preferable in complex and extremely complex situations is that those are

inundated with huge amounts of variables and input factors, the processing and analyzing of

which humans are not capable of. At least, not within a reasonable period of time. However,

artificial intelligence is the best at solving such complexities faster than even the smartest

humans on earth (Jarrahi, 2018, pp. 579–584).

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To sum up the preceding thoughts, it can be said that humans are good at solving unclear and

not well-structured problems, abstract thinking and conceiving of the world. Machines, on the

other hand, are good at solving clearly defined and well-structured problems (Bolander, 2019,

pp. 852–853) and analyzing vast amounts of data (Jarrahi, 2018, pp. 579–584). Despite the

ambiguous point of views and the differences in skills of AI and humans, it can also be observed

that there are more researchers and IT experts for a combined application of AI-based

technologies with humans than there are for the mere use of only one of them. Not only

academics are of this opinion but many companies, too, believe that a cooperation between AI

and humans will surely occur which is going to be more beneficial than replacing humans or

working separately (Brock & Wangenheim, 2019, pp. 129–130; Duan et al., 2019, p. 68).

Obviously only a combination of them can provide the best solution for solving challenging

organizational problems (Bolander, 2019, p. 856). This is because in such a synergistic

relationship between humans and AI the strength of one party can compensate the weaknesses

of the other party and vice versa (Jarrahi, 2018, pp. 579–584). As a consequence of this, both

AI and humans are likely to form integral part of complex decision making processes in the

future (Jarrahi, 2018, pp. 579–584).

3.2.4 AI in Recruitment Practice

A great variety of new talent detection and evaluation means have been produced by digital

innovations and developments in artificial intelligence (Dattner et al., 2019). Many of these

tools are said to have been designed to help companies find the most appropriate individuals

for particular jobs and filter out the ones unsuitable for the advertised vacancies. What is more,

these technologies are expected to do this cheaper and faster than ever (Dattner et al., 2019).

AI-based recruitment is now more than just addressing as many potential employees as possible

or just filtering resumes, it goes much further. AI-operated tools offer much opportunity for

53
companies which do not think suitable job applicants can be selected by just screening and

interviewing (van Esch & Black, 2019, pp. 730–731).

According to Black and van Esch (2020, pp. 218–219), AI-based recruitment technologies have

mainly been used across four ranges of tasks: scope, detection, evaluation and coordination. In

the first phase, organizations attempt to identify potential applicants and offer them jobs that

will encourage them to apply. Inevitable part of job applications is the submission of either

resumes or any kind of application forms, which are then detected in the next phase. The next

step is to determine which applicants seem to be the most appropriate choices. This takes place

within the scope of the evaluation processes which may be built up from more rounds until the

final decisions are made. Finally, AI can also operate as a coordinating system between

organizations and applicants all along the recruiting process (Black & van Esch, 2020, pp. 218–

219). Diverse AI-tools have already been created for each of these stages. For a better

imagination, some of them will be introduced below in short with the help of real-life examples.

Stage 1: Identification of Relevant Candidates

To have an optimum applicant pool, organizations must cleverly identify both passive and

active job seekers (Black & van Esch, 2020, pp. 218–219). Firms like Talenya, HireScore and

Pandologic use artificial intelligence to first collect information from social media platforms

and job boards such as LinkedIn, XING, MeetUp, Facebook and Instagram, just to name a few,

and then to fit candidates to jobs (Campbell et al., 2020). However, it is not enough to just

find prospective suitable employees. Organizations also need to adjust the language, the

wording and the method that best matches the candidates they want to address (van Esch

& Black, 2019, pp. 730–731). In the course of time, AI learns which approach works best with

every type of job seeker and customizes the presentation method (Black & van Esch, 2020,

pp. 218–219). Texito, for instance, can use AI to customize the exact wording used in job

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advertisements and track what effects that have on the number of job applicants and their

demographic data. This contributes to an increased scope, too (van Esch & Black, 2019,

pp. 730–731). Another noteworthy example could be Nvidia that uses AI chips for mobiles

which analyzes the behavior and speech patterns of users that allows Nvidia to couple job

seekers with jobs fitting both their work-based and personal traits (van Esch & Black, 2019,

pp. 730–731). One should consider that LinkedIn, for example, had almost 600 million users in

2018 with each having hundreds of singular data points in their profiles. According to Black

and van Esch (2020, pp. 218–219), the efficient analysis of this amount of data without the

application of artificial intelligence is not possible in a reasonable period of time.

Stage 2: Detection of Applicants

For the purpose of assessing the experience, market value, skills and availability of applicants,

organizations like IBM, Intel or eBay use an AI-based machine through Hiretual which checks

job seekers against almost a billion professional profiles across 30 diverse job boards and other

online platforms (van Esch & Black, 2019, pp. 730–731). In this phase, companies also start to

collect biographical data (biodata) from applicants. Biographical information stem from

standardized techniques of measuring past behaviors (job experience, education) which can

affect future job performance (García-Izquierdo et al., 2015, p. 156). Another important aspect

of this stage of recruitment process is the re-screening of past rejected applicants. Only because

formerly refused applicants were not found to be suitable for a previous job, it does not

necessarily imply that they cannot fit any of the future jobs at a company (Black & van Esch,

2020, pp. 219–220). The fact that the applications of these candidates are often stored in diverse

formats and at different places (in the cloud, servers, third-party digital storage etc.) makes their

rediscovery more difficult and often expensive for a manual search. On this occasion, too, AI

can help solve the problem (Black & van Esch, 2020, pp. 219–220). Companies like Adidas,

Wayfair and Macy´s have adopted AI-bot recruiter to analyze their own automated tracking

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system (ATS) and further sources to assure the constant discovery and rediscovery of the best

applicants (van Esch & Black, 2019, pp. 730–731).

Stage 3: Evaluation of Job Applications

If companies want to somehow evaluate their applicants, they must first define what it takes to

be one of the best candidates, at least, from their perspective. In other words, firms should have

a basis of comparison. Several AI tools make decisions about what could be defined as success

in particular situations, based on real people´s attributes. Such groups of people are often called

the “training data set” and consist of managers or employees whose performance is highly

acknowledged. AI tools compare current candidates´ profiles with these “ideal” ones, assess to

which extent they coincide with each other and predict the probability of success when choosing

any of the applicants (Chamorro-Premuzic et al., 2019, p. 3). Video-recorded interviews are one

of the characteristic AI-based methods in this stage. HireVue is a company that offers AI-

supported video-recorded interviews with analysis. The AI machine asks applicants several

questions during the interview. The responses are then analyzed based on an evaluation of

average and successful past employees in the same positions. Besides applicants´ answers, their

ton of voice, word choice and micro-facial movements were as well subject of assessment in

order to estimate the honesty of responses and to classify the personality type of the interviewee

(Black & van Esch, 2020, pp. 219–220).

Stage 4: AI as an Intermediary Mean

The intermediary role of AI is, in the proper sense, not a fourth stage but rather an

accompanying function fulfilled by the technology during the entire recruitment process.

Companies such as Delta, Public Storage and CVS Health use an AI-enabled assistant program

called Olivia to be concerned with applicants through mobile devices and social media

platforms so that their job experience, skills and related personal data can be assessed. Moreover,

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Olivia helps applicants make progress in the recruiting procedure from the first steps through

online interviews to the submission of final applications (van Esch & Black, 2019, pp. 730–

731).

3.2.5 Biases of AI
The assessment of intelligence and cognitive abilities is thought to reliably and validly estimate

the job success of candidates in several professions. Though these kind of evaluations can be

discriminatory if they unfavorably affect some groups, for instance those defined by race,

gender, nation or gender (Dattner et al., 2019). At most organizations, recruiters still rely on

their own intuitions (Chamorro-Premuzic et al., 2019, pp. 3–4) and exactly these cognitive

biases lead to restricted reliability and validity of judgment and to a decrease in the

meaningfulness of the results throughout the detecting process (Black & van Esch, 2020,

pp. 216–217). It is obvious since the performance of a program or an algorithm can never be

better than the data it is based on (Bolander, 2019, p. 858).

Black and van Esch (2020, pp. 216–217) distinguish three main types of biases which are

similarity bias, anchoring bias and confirmatory bias. The first one describes the phenomenon

in which recruiters un- or subconsciously prefer applicants similar to them irrespective of

whether those resemblances constitute beneficial factors for applicants´ future performance.

The second one occurs in situations in which recruiters make their judgments based on what

they first saw, heard or experienced. In other words, first impressions influence recruiters´

subsequent decision making. And the last one emerges when recruiters search for information

which correspond to their initial judgments about applicants. Additionally, Bolander (2019,

pp. 860–861) notes that the aforementioned training data set – in the evaluation stage of

recruitment processes – can be biased, too, if that included a racial bias stemming from the data

it was based on.

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Another interesting concern is the Rational Bias Theory (RBT) which could explain the

empirically proven existence of discriminatory elements in the e-recruitment procedures of both

some private and public companies (García-Izquierdo et al., 2015, pp. 156–157). According to

this theory, if employees assume that their supervisors and the company support discrimination,

employees are also likely to discriminate. In addition, even if they do not have prejudices.

Furthermore, the theory consists of two prerequisites leading to gender discrimination: the

compliance instrumentality and the preference norm. The former one claims that decision

makers have the feeling that a potential disapproval of supporting the present biases would have

a negative effect on their own careers. The latter one suggests that decision makers believe that

important individuals (including chiefs and clients) expect them to make gender-discriminative

decisions. In short, the existence of potential discriminatory factors supports discrimination

(García-Izquierdo et al., 2015, pp. 156–157).

There are real-life examples of biased systems used in organizations. Just to name one, Amazon

had an automatic program looking for talents by reviewing applicants´ resumes which has

turned out to have a gender bias (Dattner et al., 2019). Owing to the Rational Bias Theory,

unstructured interviews – the most commonly used selection method – have only a 14%

accuracy in predicting well which applicants will, in the end, stay with the organization and

have a good performance. In case of structured interviews, this estimating value is still low,

approximately 30% (Black & van Esch, 2020, pp. 216–217). Some specialists are attempting

to balance the information used for teaching AI machines, to evenly represent every group. This

is important for eliminating biases. The more data an AI tool has and can learn from, the higher

the chance of keeping probable biases under control (Dattner et al., 2019).

Chamorro-Premuzic et al. (2019, pp. 3–4) argue that biased systems are basically the reflections

of our own behavior, and due to the fact that we, biased humans create such systems, the

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omission of biases from AI-based tools is quite difficult. However, Black and van Esch (2020,

p. 223) are definitely of the opinion that the coding of race-, religion- and gender-neutral

algorithms is not impossible at all. For that purpose, Black and van Esch (2020, p. 223) suggest

the intentional neutralization of AI algorithms and the limitation of their scope of learning. On

the other hand, organizations should focus on new instead of old inputs to guarantee that AI

machines comply with organizations´ progressing human capital strategy (Black & van Esch,

2020, p. 223).

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 4 Advantages and Disadvantages of AI and
Other Tools in HRM

In the preceding chapter, basic features, characteristics and capabilities of diverse electronic

means and technological solutions used in HRM were subject of discussion. In this chapter the

focus is on the beneficial nature of these tools from an organizational perspective. It will be

described how these digital means can contribute to the well-functioning of companies as well

as in which ways they can facilitate competitive advantage. Although the main goal of this work

is to present the advantageous aspects of these technologies which human resource management

can benefit from, these tools, too, can under some circumstances exhibit disadvantageous

functionalities. Therefore, in order to avoid the foundation of malfunctioning digital recruitment

systems, attention will also be called to potential detriments of these tools at the end of each

sub-chapter.

4.1 Advantages of E-Recruitment

Given the unprecedented advantage of more efficient and much faster information exchange

between parties offered by the internet (Maurer & Liu, 2007, pp. 305–306), e-recruiting

technologies have exceeded the horizon of recruitment and simplified job applications (Lee,

2011, p. 237). Before the advantages and benefits resulting from the usage of such tools will be

discussed, it should be first defined when an e-recruitment system is considered to be beneficial.

According to Stone et al. (2013, p. 52), e-recruitment systems are effective when they enable

individuals and organizations to achieve their short- and long-term goals. If this is the case, it

can be said that the technology used is profitable, at least to a certain extent (Stone et al., 2013,

p. 52).

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Since the topic is of internet-based e-recruiting, it may be logical to first take a look at the

advantages of such tools resulting merely from the use of internet. For example, due to the

interactive and multimedia capabilities of the internet, organizations are able to provide much

more information to potential job candidates by using e-recruitment, compared to newspaper

advertising (Lee, 2011, p. 237; Maurer & Liu, 2007, pp. 305–306). E-recruitment makes it

possible for individuals who are looking for jobs to conduct a much wider job search due to the

negligibly low search and application costs (Lee, 2011, p. 231). Moreover, they will have higher

chances of getting jobs they best fit in and are qualified for (Lee, 2011, p. 231; Stone et al.,

2013, p. 67). This is perhaps also due to the fact that an incredibly great pool of job applicants

can be generated, by virtue of the endless capacity of internet and an automated screening

process (Lee, 2011, p. 231), at remarkably low costs (Breaugh, 2008, pp. 113–114; Lee, 2011,

p. 231; Ployhart, 2006, pp. 881–882; Stone et al., 2013, p. 67).

Similar advantages can be observed from organizations´ perspective: job advertising and

application processing expenses can be decreased by having e-recruitment systems (Lee, 2011,

p. 231; Stone et al., 2013, p. 67) a and since companies have access to wider labor markets,

they will with higher probability be able to identify suitable, well-qualified job seekers (Lee,

2011, p. 231). Additionally, in this way organizations can improve their recruiting and selecting

practices and achieve greater productivity at decreased costs (Stone et al., 2013, p. 67). It is

therefore no wonder that almost every bigger staffing company has implemented some kind of

internet-based e-recruitment technologies (Ployhart, 2006, pp. 881–882).

By taking a closer look at the potentials of internet-based e-recruiting systems, further benefits

can be observed: first and foremost, content can more easily be posted online on the official

website of companies than on a job board site (Bagheri Rad et al., 2020, pp. 525–526) or in

newspapers (Lee, 2011, p. 237). Moreover, not only can a large amount of information be

61
posted on the websites but also can a lot of different types of information be shared with

potential future employees, like employee benefits, a short history of the particular company,

organizational values and mission, culture, and further content necessary to maintain a positive

organizational image (Bagheri Rad et al., 2020, pp. 525–526). Not surprising is thus the fact

that even twenty years ago 90% of large U.S. companies already operated their own official

recruiting websites according to Cappelli (2001).

It should be noted that not only job-related information is useful in the recruitment process but

also the presence of these previously mentioned additional information – posted on

organizations´ website – can facilitate a better decision making for job applicants (Bagheri Rad

et al., 2020, pp. 525–526). For instance, from a person-job fit aspect. Stone et al. (2013) notes

that organizations might be inundated with applications from candidates who do not indeed fit

the advertised job. Yet, this does not necessarily constitute a problem: Hu, Su, and Chen (2007)

have suggested companies to take advantage of websites´ interactive capabilities by providing

feedback regarding person-job and person-organization fit to job seekers. Dineen, Ash, and Noe

(2002) have found that candidates who have received positive feedback in this manner, were

more attracted to the company where they had applied for a job.

One should consider though that the sole possession of a nicely designed website and the

provision of feedback are not sufficient prerequisites for the effectiveness of an employer´s

website. That greatly depends on the visibility and reputation of the organization, too (Breaugh,

2008, pp. 113–114). Furthermore, this kind of website recruitment can significantly reduce the

amount of time needed to apply for a job, from the perspective of job candidates, and the amount

of time required to completely and successfully recruit job seekers, from the perspective of

organizations (Bagheri Rad et al., 2020, pp. 525–526).

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The advantages of the adoption of e-recruitment systems have been proved by numerous studies

and research results (Lee, 2011, p. 230). Lee (2011, p. 230) for example points out the results

of a research conducted by Aberdeen Group, an international marketing company, the main

profile of which is the collection and analysis of a huge amount of marketing-related data. He

notes that an analyzed organization – that actively uses e-recruiting technologies – which has

hired 10.000 new employees within a year could, in average, save $900 per hire. That is $9

million per year. Beyond that, recruiting cycle time has dropped, too, in the same company by

50% to 63%. Based on the same study, but with regard to another company, results have shown

that job advertising costs have decreased from $27.000 to less than $2.000 also within a year

(Lee, 2011, p. 230). Lee (2011, p. 230) refers to another, yet unnamed study which indicates

that the cumulative savings resulting from the adaption of e-recruitment systems can yield a

return to investment of 6 to 1, that is a $6 earning for every $1 invested. The argumentation for

this extreme profitability was that these systems can, among other things, lead to a better

employee quality, greater hiring efficiency and different kinds of cost savings (Lee, 2011,

p. 230).

Nevertheless, the research-conducting organization Aberdeen Group highlights that the size of

companies, and more particularly, the number of the jobs companies need to fill have a

substantial influence on cost savings in the hiring process (Lee, 2011, p. 230). Strohmeier and

Kabst (2009, pp. 484–485) are of the same opinion. They claim that bigger organizations can

benefit more from automation of hiring processes due to the larger number of HR tasks and the

greater amount of job applications. What is more, because of the spatial separation of

organizations into different buildings and locations, big companies – and for the opposite reason

no small firms – can take advantage of collaboration functions offered by e-recruitment

technologies (Strohmeier & Kabst, 2009, pp. 484–485). They further note that automation and

collaborations, as well as the induced information sharing through these tools, all together

63
should really be integrated into the overall operation of companies since these can reduce hiring

costs, time and increase the quality of HR processes.

Lee (2011, p. 231) calls attention to another important advantage of the use of e-recruiting

systems throughout companies which is rarely in the focus of attention: the bigger an

organization is, the more will agency costs increase. This is due to complex management,

control of agents and a higher information asymmetry between agents and principals. These

agency costs are harmful for companies because agents might make decisions that are not in

the interest of the principals. On the other hand, agency costs entail costs of coordination and

surveillance of operating activities (Jensen & Meckling, 1976, pp. 308–310). An overall IT e-

recruitment adaption, however, could cause a considerable reduction of such agency costs

through effective coordination and monitoring of activities among hiring managers, human

resource employees and job candidates (Lee, 2011, p. 231).

In spite of the widespread use of e-recruiting technologies, not much research has been done on

finding out what determines their effectiveness and the applicant acceptance (Stone et al., 2013,

p. 67). Although these tools should be implemented to be in accordance with applicants´ values

and skills, this is not always the case (Stone et al., 2013, p. 52). One of the most common

challenges, or obstacles, are organizational websites which, if designed poorly, will likely

discourage job seekers from applying for jobs online (Lee, 2011, p. 231). Pastore (2000) for

instance notes that surveys have shown that 20% of job candidates have at least once rejected

a job offer solely because of the website´s inappropriate layout. Still others have complained

about the complex and chaotic design of organizational websites which have hindered them to

successfully submit any applications (Maurer & Liu, 2007, pp. 305–306). Furthermore, another

important issue is data security and privacy concerns which should, as well, be included into e-

HRM systems. Otherwise, candidates will likely get deterred from submitting their job

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applications in the end. The reason is obvious: they do not want to get hacked, nor do they want

to reveal and share their private information with everyone (Lee, 2011, p. 231; Stone et al.,

2013, p. 52).

Another approach to find out the advantages of electronic staffing techniques is not when the

outcomes are analyzed and assessed but when it is observed what happens to companies that

forego such tools, compared to companies that do not. Lee (2011, p. 230) claims that some

organizations have resigned from e-recruitment after years of experimenting with it and started

to use traditional recruiting methods again. However, they have not counted with the

consequences which were endless amounts of job applications they could not timely manage to

deal with. In addition, most of those applications came from unqualified or unsuitable

individuals (Lee, 2011, p. 230). Lee (2011, p. 230) also notes that many of these companies

have begun to realize that one can benefit the most from e-recruiting technologies if those are

unobstructedly integrated along the entire recruitment process over the whole company.

All in all, it is obvious that e-recruitment systems are remarkably advantageous from many

different aspects and that they are meant to be more efficient and effective than traditional

recruitment methods (Gueutal & Stone, 2005). To sum up their benefits in short, it can be said

that they, among other things, provide companies with a great number of candidates, speed up

the development and assessment of applicant selection procedures (Lee, 2011, p. 230), improve

cumbersome administrative processes by automatically monitoring and analyzing applications

to ensure that candidates are suitable for the advertised jobs, simplify the job analysis

procedures, enable organizations to interview job seekers by using internet-based technologies

– thus asynchronous communication becomes possible and allow the use and storage of

applicant information. And what is more, these benefits themselves result in a significant

decrease in working time and different kinds of costs, which in turn leads to further

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improvement of the entire recruitment system of organizations (Stone et al., 2013, pp. 51–52).

In the following paragraphs, advantages of employer branding and social media recruitment

will be described, whereat similarities among beneficial effects can be observed since these

techniques are sub-parts of e-HRM systems.

4.1.1 Advantages of Employer Branding

It might be impossible to apply for a job at a company, the existence of which we do not even

know anything about. Conversely, we can only apply for a job, if we are either aware of the

particular job advertised or, indirectly, we have some information of a certain company and we

look and apply for jobs there. However, from firms´ perspective it is not enough for job seekers

to just know about organizations. According to Collins and Han (2004, p. 697), organizations

should actively operate employer branding to raise public awareness of themselves, because

candidates seem to be believe that more famous and better known companies tend to have

positive attributes and are more attractive as employers than are less known competitors. In

addition, this assumption has been proved (Collins & Han, 2004, p. 697; Tumasjan et al., 2019,

p. 88).

Besides this, not only the quantity but also the quality of the candidate pool can organizations

likely influence by employer branding in a positive way by triggering more positive

associations in people´s mind than do less known or disreputable firms (Collins & Han, 2004,

pp. 698–699; Ployhart, 2006, pp. 871–872). According to Collins and Han (2004, pp. 698–699)

this is because more qualified candidates will – in the hope of receiving any offers – with higher

probability apply for jobs in companies about which they have favorable preconceptions. Not

to neglect is the fact either that investments in employer branding can not only beneficially

affect the perceptions of companies but also that of their products, and therefore considerably
66
influence their market shares and sales (Collins & Han, 2004).

One of the most determinant aspects with regard to employer branding is the amount of

provided information about companies and or their advertised jobs and the way that is presented.

To better understand how individuals process presented information it might be reasonable to

first introduce one of the most popular marketing theories, the elaboration likelihood model

(ELM). This model attempts to explain how advertisements – or in this case recruitment

advertisements – with more or less detailed information might result in positive outcomes

(Roberson, Collins, & Oreg, 2005).

Based on the theory, receivers of an advertised message actively take part in a persuasion

process since they develop cognitive responses in reaction to the stimulus to which they had

been exposed (Petty, Cacioppo, & Goldman, 1981). The ELM argues, too, that there are two

routes through which persuasion influences the attitudes of receivers: the central route, in which

the message is advertised through direct processing of ideas, content and arguments within the

ad; and the peripheral route in which the message makes the receivers develop perceptions

about the advertised product through cues other than the persuasiveness of the arguments in the

message (Petty et al., 1981). In case of low-involvement, when individuals are less motivated

about an advertised product or when their personal relevance decreases, receivers can be

addressed through the peripheral route. On the contrary, when individuals are more motivated

and their personal relevance increases, there exist high-involvement and receivers can be

persuaded through the central route (Petty & Cacioppo, op. 1986, pp. 147–178).

In principle, both low- and high-involvement employer branding can be beneficial but each in

different situations and they do not work inversely. According to Roberson et al. (2005), when

looking for jobs, most candidates do not have enough information about essential job attributes

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because those are not easy for organizational outsiders to observe. Therefore, job searchers are

compelled to base their decisions on more noticeable manifestations of the specific organization

or job (Roberson et al., 2005). It has been found that person-organization fit and perceptions of

companies affected candidates´ intentions to apply to companies when recruitment ads were

general, thus peripheral route has been addressed (Roberson et al., 2005). In other words, when

recruitment messages are general, job seekers seem to be more influenced by implications

stemming from available information like perceptions of organization attractiveness (Roberson

et al., 2005).

Furthermore, even when applicants do not actively look for information about a specific

company, low-involvement strategies can still have substantial effects on candidates´ behavior

by advertising positive images which can be processed incidentally (Collins & Han, 2004,

pp. 691–692). This kind of strategies might be especially effective due to the fact that they can

subconsciously call job seeker´s attention to potential job offers (Collins & Han, 2004, pp. 691–

692). However, from the moment, awareness of a particular organization has been raised and

low-involvement ads are of no relevance anymore (Cable & Turban, 2001), only high-

involvement ads can provide solution, which offer further and more specific information related

to particular organizations. According to Roberson et al. (2005), such more detailed recruitment

information can release increased perception of person-organization fit which again was found

to raise the chance of job candidates applying to the particular organization. In other words,

specific recruiting message can trigger positive reactions from job seekers. Moreover, high-

involvement messages has been perceived as more credible and more attractive by applicants

(Breaugh, 2008, pp. 112–113).

Backhaus and Tikoo (2004, p. 513) argue that employer branding can be used as a bundle of

different advertising activities within which hiring managers can direct diverse employee

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recruiting and retention methods into an organized human resource strategy. They also claim

that the inclusion of such activities in one bundle has a fundamentally different effect than each

of the activities would have separately. To sum up, employer branding can – if effectively

applied – be a source of sustained competitive advantage (Backhaus & Tikoo, 2004, p. 501;

Ployhart, 2006, p. 873) due to its rarity, value, irreplaceability and inimitability (Ployhart, 2006,

p. 873). Ultimately, supportive employer branding can positively affect both organizational-

level and candidate recruitment outcomes (Ployhart, 2006, p. 873).

4.1.2 Advantages of Social Media Recruitment

After having seen the extreme reach social media tools have all around the globe, now the focus

is on further advantages, in short. Several employers carefully peruse job applicants´ social

media profiles to get more information about their prospective employees, in the hope of finding

some useful information that could not be assessed or get uncovered within the limits of job

interviews (van Esch & Mente, 2018). For instance, the screening of social media profiles of

job applicants can be used to discover job applicants´ inappropriate behavior characteristics like

drug or alcohol consumption, discriminatory comments or other illegal activities and to get rid

of such candidates. Individuals who behave so are thought to exhibit lack of professionalism.

The discovery of profiles containing inappropriate content has already made at least half of the

hiring managers who use social media tools refuse an application (Henderson, 2018, p. 4).

Although the content of most social media platforms like letters, images, news articles, videos,

emails etc. is unstructured, analysis of such data can be especially beneficial for organizations

since they offer insights into competitors, customers, and particularly into potential employees´

lives, behavior patterns, hidden personality traits and much more (Lee, 2018, p. 209). Moreover,

social media can supposedly reflect its users´ intelligence (Dattner et al., 2019).

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Social media communication enables many more employees of organizations to share their

thoughts and ideas with each other than it would otherwise be possible by any traditional forms

of organizational communication like phone calls, personal meetings, emails and so on. This is

due to the asynchronous nature of social networking which means that no immediate attention

is required from individuals. They can pay attention whenever and in any way they want. On

the other hand, social media communication is directed to many addressees instead of just one

person addressing another one (van Eeden, 2014, pp. 214–215).

Furthermore, the usage of online job boards or third-party websites is not only good for

increasing the number of potential candidates. It can also reach a more diverse group of job

seekers from a geographical perspective (Bagheri Rad et al., 2020, pp. 525–526).

Geographical distribution itself is by far not enough to fully exploit the opportunities offered

by social networking. Van Eeden (2014, p. 216) believe that organizations should be present on

as many social media platforms as possible since they facilitate the organization of people

around themes of shared interest. However, the presence on at least a very few social media

sites is not only crucial for organizations if they want to address a great number of applicants.

This is also beneficial due to the negligibly low costs of using such tools that traditional

recruiting methods cannot compete with (Roth et al., 2016).

There is one thing recruiters should be aware though. It is not clear where the threshold is

between ethical and unethical screening of private life (Dattner et al., 2019). On the other hand,

job candidates might find it invasive if their social media profiles become subject of hiring

managers´ monitoring and can get dissuaded from applying for any jobs at the particular

company. In addition, they can lose their trust or interest in that organization (van Esch & Mente,

2018).

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4.2 Advantages of AI

In chapter three, a brief insight could be gained into how organizations can take advantage of

AI-based systems. This chapter covers the benefits of this technology more in detail from

companies´ perspective with a main focus on organizational recruitment-related advantages.

A myriad of articles in top management magazines and white papers from pioneer technology

providers have been written on the issue of how to profit from AI-supported solutions (Duan et

al., 2019, p. 64), the new key source of competitive advantage (Black & van Esch, 2020, p. 224).

Artificial intelligence can improve efficiency to an inconceivable extent by automating business

processes in a wide range of industries (Campbell et al., 2020, pp. 228–229). Such AI machines

can be found in almost every area of life from accelerated risk and cancer diagnostic processes

in healthcare (Brock & Wangenheim, 2019, pp. 110–111) through retail, banking and finance

branches to transportation, communication (Campbell et al., 2020, pp. 228–229) and, of course,

human resource management of companies (Black & van Esch, 2020; Jarrahi, 2018; van Esch

& Black, 2019; Webber et al., 2019). Although AI tools may seem to be mainly predominated

the workplaces among young employees of new generations (Webber et al., 2019, pp. 745–746),

they can basically provide help for everyone with taking emerging opportunities in real time

(Campbell et al., 2020, pp. 230–231).

Due to the endless amount of data available nowadays and the ever faster and cheaper

computing power, artificial intelligence can offer deeper insights than can traditional statistical

methods (Campbell et al., 2020, pp. 228–229), since it can reveal patterns humans are not able

to perceive (Chamorro-Premuzic et al., 2019, pp. 3–4). It is thus no coincidence that the head

of IBM is of the opinion that AI is a technology to broaden humans´ intelligence (Duan et al.,

2019, p. 64). Also the executive chairman of LinkedIn – one of the greatest and most popular

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online job boards – has claimed that AI facilitates better human decision making due to its

capabilities (Jarrahi, 2018, p. 581). However, besides these advantages resulting from AI´s

interpretation skills of extreme amounts of data and many other benefits this technology can

offer, the focus here should be on recruitment-related advantages of using AI. One thesis would

otherwise not be enough to list all the upsides of artificial intelligence. In a similar way to the

sequence of paragraphs about the application of the technology in recruiting processes in

chapter three are the advantages outlined below. This is useful for reasons of greater clarity in

the thesis.

Stage 1: Identification of Relevant Candidates

Not only can AI raise the number of job candidates in this phase but it can do so by

simultaneously also increasing the quality of the candidate pool. Black and van Esch (2020,

p. 219) mention two organizations as examples for increased application numbers: both

Unilever and L´Oréal have opened towards AI-enabled hiring tools to target job seekers for

their vacancies. While Unilever has more than doubled the number of applications, L´Oréal has

received 400 candidates per position as well. These many candidates, however, consist of not

only applicants actively looking for jobs. On the contrary, AI could identify passive candidates,

too, who AI considered more suitable for the particular jobs in some cases. Though the way

how these applicants were targeted has played a fundamental role. AI tools have analyzed the

personal profile of applicants and presented different aspects of organizations to them

depending on what AI thought to be the best and most alluring advertising method. Such aspects

were, for instance, the results, culture, applied technology or leadership of organizations.

Another important concern in this regard, besides the presentation method, was the use of

language in the addressing itself. An AI-based program, Texito, can adjust the wording in

advertisements and observe the effect of changes in wording on the number of candidates. This

AI solution does not only affect the extent of the applicant pool, but also can it be used for other

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purposes. L´Oréal, for example, could eliminate its gender biased wording from its

advertisements (Black & van Esch, 2020, p. 219).

Stage 2: Detection of Applicants

One of the main advantages at the second stage of the recruitment, that should be mentioned

here, is the superior efficiency with which AI-based machines can screen job candidates.

According to Kuncel, Klieger, and Ones (2014), AI was found to have a 25% better performance

compared to humans in detecting individuals´ resumes. In addition, even when a great amount

of time was available for recruiters. A further considerable aspect is the time-to-hire factor

which is of great significance for some companies. The reason for that is obvious: no applicant

would wait weeks for the results after having submitted an application if a competitor company

offers another job opportunity. A reduction in time-to-hire can consequently constitute a

potential competitive advantage, that organizations – particularly those in branches with high

turnover – could benefit from. AI can, of course, help with this, too. An AI-based applicant

detection tool provider, Ideal claimed that its customers´ time-to-hire has decreased with 62,5%.

Hilton Hotels & Resorts and L´Oréal have both adapted similar AI tools and reported from an

88% and a 90% reduction in time-to-hire (Black & van Esch, 2020, p. 220). Furthermore,

concerning biodata, which is first collected from individuals in this phase of the recruitment, it

can be said that these can be collected at low costs and with reasonable validity across diverse

factors and situations. What is more, candidates do not really falsify their answers (García-

Izquierdo et al., 2015, p. 156).

Stage 3: Evaluation of Job Applications

AI can help further constrict the pool of applicants after the detection and primary selection in

stage two. Among other things, this could happen within the framework of job interviews. In

this case, online, virtual, video-recorded interviews. Unilever has conducted such interviews

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through AI-supported tools offered by HireVue (Black & van Esch, 2020, p. 221). So far, the

focus was on how organizations can benefit from AI. This interview, however, is not only

advantageous from organizations´ perspective but also from applicants´ point of view. On the

one hand, applicants were able to take part in the interview whenever they wanted, at any time

with an only time limitation of some days. This opportunity saved some time for each party. On

the other hand, this little control over the schedule that was given to participants had positive

effects on their attitudes towards the whole recruitment process because research has shown

this would happen when people have the sense of having more control and influence on the

happenings and processes (Black & van Esch, 2020, p. 221). This interview, initiated by

Unilever, resulted in a list of 300 recommended final applicants out of 45.000 candidates and

82% of the finalists have accepted the job offers (Black & van Esch, 2020, p. 221). Last but not

least, applicants could get feedback of their assessment from the company where they had

applied for a certain job at the end of the recruitment process. In this way, they could gain

insight into their weaknesses, strengths, improvement needs and, optionally, into their

organizational fit at the particular company (Dattner et al., 2019).

Stage 4: AI as an Intermediary Mean

AI-based machines can furthermore provide a positive job application experience for both

accepted and rejected job seekers. According to Black and van Esch (2020, p. 222), L´Oréal

treated job applicants like they were customers and tried to create a smooth, trouble-free digital

environment for them, just like it did for its customers. This idea has ended up in a 92% level

of satisfaction of almost two million applicants despite the fact that they were all rejected.

Consequently, artificial intelligence is capable of creating a pleasant virtual atmosphere and

facilitate an efficient coordination of job applicants across the entire recruiting procedure (Black

& van Esch, 2020, p. 222).

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There are some further favorable aspects – more or less independent of the above described

stages of recruitment processes or, at least, the classification of which is not easy – in which AI

can surpass humans. First, Black and van Esch (2020) believe that AI-based recruitment

machines are more objective and less biased than are humans. Second, they are also convinced

that companies seem to be more attractive in the eyes of candidates just by having AI-supported

tools and by also actively communicating that to the public. The reason for this is that

individuals might perceive such companies as novel, modern and pioneer. This can also lead to

more entirely completed job application processes, which is interestingly not always the case

(Black & van Esch, 2020). Third, organizations can save remarkable amounts of expenses by

using AI-enabled recruitment machines which are much more cost-effective than humans

(Black & van Esch, 2020). Moreover, AI is able to reveal dubious personal or intimate

information of candidates by analyzing their social media platforms and other online activities

while recruiters are not allowed or ought not to ask candidates such questions (Dattner et al.,

2019).

By now, it should have become obvious how much and diversely organizations can benefit from

the integration of AI-based machines in their business processes. One should note that the main

focus of the benefits was on AI-enabled recruitment supporting tools. The entire spectrum of

methods firms can take advantage of AI is much wider. The great variety of advantages provided

by artificial intelligence speak for themselves. All of them result in remarkable cost and working

time reduction. As a consequence, organizations using this technology can, in contrast to

companies which do not engage in AI, achieve competitive advantage. However, there are some

potential risk factors or maybe disadvantages, too, with regard to AI that organizations should

be aware of so that they can avoid them. So, in the following paragraphs attention will be

devoted to some of these concerns, in brief.

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4.3 Disadvantages of AI

Besides the countless advantages AI-based tools can offer, there are some potential risk factors

or maybe disadvantages, too, with regard to AI that organizations should be aware of so that

they can avoid them. So, in the following paragraphs attention will be devoted to some of these

concerns, in brief.

The dissemination of AI has triggered several controversial statements. According to Duan et

al. (2019, pp. 63-64), Bill Gates, for example, has claimed that humanity should be concerned

about the hazards of artificial intelligence. Similarly expressed himself Stephen Hawking – one

of the greatest physicists ever – when he said that the improvement of AI could bring a

devastating future for humanity, based on Duan et al. (2019, pp. 63–64). But besides these

severe perspectives there are also some less hazardous aspects of AI technology that one should

consider before the adaption of such systems.

The mystery of AI´s nature and its technical possibilities might originate from the fact that there

is relatively little academic research focusing on the proper application and the influence of

new generation of AI tools from a technological aspect (Duan et al., 2019, pp. 63–64).

Furthermore, there is even less knowledge about recent recruiting tools mainly used in the

already described evaluation stage. Dattner et al. (2019) point out that many of these tools has

not occurred in the course of scientific research but rather as IT innovations. Consequently,

users cannot make sure whether the prediction of these programs are reliable. Either can they

assure themselves what such programs base their decisions on (Dattner et al., 2019).

Although AI-supported machines are more and more popular, there is still uncertainty about

their precision and the legal and ethical systems rooted in them (Dattner et al., 2019). The fast

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development of AI is raising important ethical and legal issues which have become great

challenges lately (Duan et al., 2019, p. 69). In part, due to the collection of biodata, the usage

and possession of which may be illegal in some way. Organizations should thus take this

concern into account if they want to avoid causing undesired effects on the attitude of their

customers, employees and partners, according to García-Izquierdo et al. (2015, p. 156). Another

threat is that employers can gain ever deeper insight into their employees´ private lives via

social media, and by using big data or AI. What is more, the scope of big data is still growing

and the more information available and known, the higher the chance of discrimination or

information misuse, warn Dattner et al. (2019). On the other hand, however, if people begin to

decrease the personal information they share with the world on social media platforms or

especially in their online professional profiles, the effectiveness of AI-based machines would

considerably decline (Black & van Esch, 2020, pp. 222–223).

Even difficulties during the integration of AI in organizational processes can emerge, too. First

of all, due to the complex features and functionalities of AI-enabled recruiting tools, the creation

of such systems entails costs organizations have to bear. Although this may not be a challenge

for companies that hire several hundreds or thousands of prospective employees every year.

Small firms, on the other hand, with much fewer employees would not benefit from such

programs since the lack of economies of scale (Black & van Esch, 2020, pp. 222–223). Besides

such real and opportunity costs, lack of trained staff could as well lead to a failure in the

adaption procedure of AI tools in organizations. Brock and Wangenheim (2019, pp. 119–122)

have found that half of the companies which took part in a global survey – conducted among

senior managers across industries – have failed to incorporate such machines because they did

not have employees versed enough in digital technologies. Lack of organizational mobility,

security concerns, incompetency of leadership and internal opposition against change have been

found to be further major reasons for an unsuccessful enforcement of AI in companies (Brock

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& Wangenheim, 2019, pp. 119–122). Finally, Black and van Esch (2020, p. 223) note that even

organizations´ own employees of the human resource management might find such intelligent

machines threatening and they would eventually undermine the tools, merely out of fear of

losing their jobs.

Therefore, Brock and Wangenheim (2019, pp. 115–116) recommend companies to develop

organizational skills and competences to take advantage of the opportunities embedded in

artificial intelligence. Such abilities are, according to them, new IT skills, data management,

analytical competences and security skills, all of which have to be integral part of organizations

as a whole, as well as across their sub-units.

A Deloitte survey in 2018 has found that approximately 38% of companies used AI-supported

recruitment machines within the framework of their major HR activities (Black & van Esch,

2020, p. 219). Black and van Esch (2020, p. 224) argue that organizations forgoing the adaption

of AI in their recruiting practices are exposed to losing their employees who may be attracted

by rival companies´ targeting activities. Contrarily, however, with the inclusion of AI systems

in recruitment processes, companies have the potential to attract not only active job seekers but

also those of competitors. Van Esch and Black (2019, pp. 730–731) believe that exclusively

through an entire organizational dedication towards digitization and AI-based technologies can

companies achieve their desired performance, keep up with competition or, eventually, gain

competitive advantage.

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 5 Conclusion

In the wake of preceding chapters, comprehensive insight into the theoretical concept of

different recruiting systems and diverse digital tools which can be used in human resource

management could be gained. Besides their conceptual explanation, several advantages and

some potential disadvantages resulting from their application were also discussed. It was

pointed out how and to what extent these improved recruitment methods and modern

technological solutions can provide comparative advantage over less digital, traditional

recruitment systems. Therefore, it is not goal of this chapter to list all the previously mentioned

benefits of the introduced recruitment-related modern approaches once again in detail. Rather,

the main emphasis here is placed only on their most determinant advantages, as well as on their

proper use which, in the end, facilitates organizational competitiveness.

5.1 Discussion

Considering the fact that intangible assets, one key component of which are talented and

knowledgeable employees, can make up approximately 80% or more of organizations´ value,

and the fact that only a small fraction of individuals on the labor markets constitute such

potential skillful employees (van Esch & Black, 2019), it is highly beneficial for organizations

to find them before competitors do so. A well-functioning recruitment system is thus a

prerequisite for companies if they want to attract and retain talents. Due to the fact that any kind

of digital recruiting tool is incorporated into a specific recruitment system, companies first have

to improve their fundamental recruiting orientation. This is important because not even the best

digital tools could work well and lead to desired organizational outcomes if the recruitment

system in which they operate is inadequate. If this was the case, successful recruitment, and

consequently, long-term competitive advantage of organizations would fail to occur.

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As could be seen in chapter two, the application of strategic recruitment models across the entire

organization could provide solution for this problem. Phillips and Gully (2015) argue that

strategic recruitment is a sustainable source of competitive advantage. Therefore, it is not only

useful for companies to adapt strategically oriented recruiting methods, but rather inevitable for

an organizational survival and success. It is also important to highlight that the most essential

factor that differentiates a strategic from a traditional recruitment system is based on the

recognition that strategy and strategic execution are influenced by micro-, meso- and macro-

level effects. Therefore, strategic recruitment models are, contrary to traditional recruiting

systems, a combination of processes across all of these levels (Phillips & Gully, 2015).

Accordingly, organizations should use only strategic recruitment methods which take cross-

level effects into consideration, whereat these methods should be in complete alignment with

other organizational factors (Collins & Han, 2004). To conclude, it can be said that a shift from

traditional to strategic recruitment systems can already in itself facilitate organizational

competitiveness. Furthermore, not only is a strategically focused recruitment system

requirement for organizational success but also is it indispensable for the implementation of e-

recruitment techniques, which have to be made in a multi-level context, whereby

organizational- and individual-levels are differentiated and interaction effects between these

levels are assumed (Strohmeier & Kabst, 2009). This, too, supports the assumption that

organizations should use strategic recruiting methods. Otherwise not even digital and online

recruiting technologies can efficiently be used, which, as this turns out from chapter three and

four, would also mean the forgoing of further potential sources of competitive advantage.

E-recruitment is basically a collection of HR tasks and hiring processes supported and

processed by different electronic tools and IT technologies (Lee, 2011; Strohmeier, 2007).

Enabled by the worldwide presence of the internet, e-recruitment technologies have a

tremendously wider reach than does traditional recruiting and make job applications and

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recruitment processes significantly faster and easier (Lee, 2011; Strohmeier, 2007). This trend

has led to a remarkable reduction in the amount of time necessary for job applications and to a

significant decrease in recruiting-related HR expenses. E-recruitment provides help by

automated recruiting processes and the provision of necessary information (Lee, 2011). E-

recruitment methods can be classified in two main categories: in partly or fully automated

digital and online recruitment processes and in employer branding activities. While the former

one is mainly implemented by artificial intelligence-based technologies, the latter one takes

place on social networking websites, most of the time. Therefore, the main focus of the thesis

was on these aspects of e-recruitment.

Employer branding, which is the usage of brand marketing techniques to improve key human

resource outcomes with the aim of raising firm performance (Ambler & Barrow, 1996), has

become extremely useful with the dissemination of social media platforms. It is especially

important in the early stages of setting up companies, when they are not yet known. In this way,

companies can attract attention and become familiar (Collins & Stevens, 2002; Ployhart, 2006).

This is necessary, because potential talented employees cannot apply for jobs at companies the

existence of which they do not even know about. Being unknown is thus a significant

disadvantage for companies in the pursuit of competitive advantage. Another crucial issue to

consider is the type of advertisement companies use within the framework of employer

branding, whereat two main kinds of advertising ways can generally be differentiated: the low-

and the high-involvement advertising (Collins & Han, 2004), each having different effects on

final organizational outcomes (Breaugh, 2008). The former one is aimed at every potential

prospective employee with the goal of raising awareness and contains only a little amount of

striking information. The latter one is oriented towards candidates actively looking for jobs and

consists of more detailed information (Collins & Han, 2004). Moreover, some organizations

might underestimate the significance of passive job seekers since those are not actively looking

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for jobs and focus on active job applicants instead. However, there are three times more passive

candidates then there are active applicants and many of them would accept a suitable job

opportunity if it was offered to them, according to Black & van Esch (2020). Therefore, due to

the fact that there are both active and many more passive job seekers, organizations should

operate both low- and high-involvement advertising and be possibly extensive with regard to

their employer branding activities, as recommended by Black and van Esch (2020). In this way,

they can increase the chance of finding the best skillful job candidates (Black & van Esch,

2020). Without doing so, organizations would lose another fundamental source of sustainable

competitiveness.

When doing advertising, organizations should also pay attention to providing sufficient

information about both the particular vacancies but also about their own company. This is

important because often job candidates are not able to judge whether and to what extent they

fit in the organizational environment, nor do they always know what a job they apply for

involves in general. In such situations lack of self-insight occurs which can result in

discrepancies in person-job fit, in person-organization fit or in both at the same time (Breaugh,

Macan, & Grambow, 2008). Mismatches in fits can lead to higher turnover rates and additional

recruiting costs which could all be avoided. Bagheri Rad et al. (2020) argue that the provision

of different kinds of information like organizational values, mission, culture, a short history of

the specific company, employee benefits and some more, could likely eliminate this problem

and support a better decision making for job applicants. Organizations should also attach

importance to the design of their website on which they provide this information. A poorly

designed homepage can discourage job candidates from applying for jobs (Lee, 2011; Pastore,

2000). However, if organizations take all these sources of failure into consideration and adjust

their advertising systems in alignment with aforementioned recommendations, e-recruitment in

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general, and employer branding in particular can support the achievement of competitive

advantage.

The presence on different types of social media platforms is one of the best opportunities for

doing employer branding activities (van Eeden, 2014). Unlike employer branding or AI-based

technologies which are real manifestations of either recruiting activities or recruitment

supporting technologies, social media websites do not themselves constitute any kinds of

recruiting means. Instead, they only fulfill an intermediary transmitting role among

organizations and job seekers. Although there are several types of social networking platforms

(Kaplan & Haenlein, 2010), the general notion could be described as internet-based

applications which allow the public communication of people (Kaplan & Haenlein, 2010; van

Eeden, 2014). Social media has unprecedentedly shaped peoples´ everyday lives, in part

because it can be used for many different things from news sharing through professional group

meetings to product advertisements. It literally covers every segment of life (van Eeden, 2014).

It is therefore no wonder that social media is as well suitable for managing organizations´ own

human relations. Therefore, a great amount of organizations have actively started to use online

social media websites to recruit individuals looking for jobs (Henderson, 2018). From an HR

perspective, one of the best advantages social media can offer companies is its versatile

applicability throughout diverse stages of recruitment processes, from the recruiting of

applicants to their hiring (Henderson, 2018). Another undoubtedly great benefit of social media

use is its incredible reach. There are multiple billions of active social media users all around the

globe which allows making contacts with almost anyone, anywhere, at any time. This has a

remarkably positive effect on the number of possible candidates (Henderson, 2018).

Finally, another beneficial, yet controversial aspect of social media is its free access to

information about people´s private lives. Companies could never before gain such an immense

insight into applicants´ and employees´ private lives. By screening and perusing job applicants´

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social media profiles, their personality traits, and more importantly, the inappropriate ones can

easily be identified (Henderson, 2018). This, of course, has implications for candidates´ future

at the particular company. In other words, by the discovery of information that could not

otherwise be assessed within the scope of job interviews, companies can take advantage of

using social networking sites (van Esch & Mente, 2018). Organizations should however be

aware of the fact that some applicants might find the monitoring of their own social media

profiles invasive which might drive them away from applying for any jobs at the particular

company (van Esch & Mente, 2018). To avoid this, only the gathering of job-related

information about candidates is recommend by García-Izquierdo et al. (2015). Ultimately,

organizations should be mindful of data security and privacy issues, too, since applicants do not

want their private information to get stolen or misused (Lee, 2011; Stone et al., 2013).

Artificial intelligence, or in other words, machines´ ability to learn and carry out tasks that are

usually completed by humans (Campbell et al., 2020; Duan et al., 2019; Jarrahi, 2018), is a

technology under constant development which is nowadays present in a wide range of industries

(Campbell et al., 2020). AI is supposed to help with the processing and interpreting of

unprecedented amounts of data generated day by day which humans are not anymore able to

overcome in a timely manner (Campbell et al., 2020). AI solutions are much faster and better

at solving advanced quantitative, analytical and computational tasks than are humans (Jarrahi,

2018). In the field of HRM, too, AI can outpace humans. Research has shown that the

application of AI-supported tools can result in increased efficiency (Black & van Esch, 2020).

AI can attract, screen and interview job candidates much faster and with more efficiency and

effectiveness than HR employees could ever do (Black & van Esch, 2020). This digitization

process has led to a remarkable decrease in expenses on placement processes and to a significant

rise in the number of applicants per vacancy (van Esch & Black, 2019). Yet there is uncertainty

about the role of AI, whether it should be used alone with the exclusion of humans, or rather

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they should just support humans in decision making processes. It could be seen in previous

chapters that AI technologies are better at solving clearly defined and well-structured problems

(Bolander, 2019) and analyzing great amounts of data (Jarrahi, 2018) while humans are masters

of finding solutions for obscure, not well-structured problems and are good at abstract thinking

(Bolander, 2019). All in all, it can be said that the majority of IT experts recommend a combined

application of AI-based technologies with humans and dissuade from the sole use of AI.

Furthermore, AI-supported recruitment tools have primarily been used in four main stages of

recruiting processes: scope, detection, evaluation and coordination (Black & van Esch, 2020).

Just to name the most important ones, there are AI tools which can initially gather information

about applicants from their social media profiles and match them to offered jobs (Campbell et

al., 2020). Additionally, when addressing candidates, organizations have to adjust the language

and the wording they use. There are AI tools that can help with this by learning which approach

works best with every type of candidate and tailoring the presentation method (Black & van

Esch, 2020). These kind of tools can substantially increase the number of candidates, and can

do so by simultaneously also improving the quality of the candidate pool (Black & van Esch,

2020). In a following phase of recruitment, AI solutions can check candidates´ social media

profiles against millions of other professional profiles across further job boards and online

platforms. Still other AI technologies deal with the re-screening of past rejected candidates, the

importance of whose many organizations underestimate. The rediscovery of such applicants is,

however, quite difficult and expensive for manual search. AI-bots can provide solution for this,

too (van Esch & Black, 2019). Organizational experience proves that when the screening of job

applicants is made by AI, the time-to-hire ratio of companies can decrease up to 90% which

again leads to significant savings in staff expenditures (Black & van Esch, 2020). One of the

most common AI-supported technologies for the evaluation stage are video-recorded interviews

with subsequent analysis. Besides candidates´ answers, their word choice, micro-facial

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movements and also their ton of voice are subject of assessment in these interviews in order to

estimate the honesty of responses and to classify interviewees´ personality type (Black & van

Esch, 2020). Moreover, AI tools can help job candidates make progress in their recruiting

procedure from the beginning to the final submission of their applications (van Esch & Black,

2019). By doing so, AI can create a comfortable virtual atmosphere and promote an efficient

coordination of candidates across the entire recruitment process (Black & van Esch, 2020).

Just like in case of previously outlined technologies used in human resource management, the

concept of AI does not lack obscurities either. Firstly, some AI tools have been found to exhibit

biased behavior. However, this does not arise from an imperfect technology. On the contrary,

biased systems are the reflections of people´s behavior and due to the fact that humans create

such technologies, the omission of biases from AI solutions does not always happen to succeed

(Chamorro-Premuzic et al., 2019). The elimination of such biases is most probably not

impossible though (Black & van Esch, 2020). Secondly, some scientists and IT-experts have

warned humanity against potential sever consequences of using AI, some have even

prognosticated a devastating future for humanity triggered by the ever enhanced development

of AI (Duan et al., 2019). Thirdly, bigger organizations can benefit more from automation of

hiring processes due to the greater amount of HR tasks and the countless job applications they

have to deal with (Strohmeier & Kabst, 2009). Finally, another important issue for organizations

to consider is related to the circumstances of their digital transformation process. Nowadays the

majority of companies know little about AI-based recruitment systems. The implementation of

such systems might therefore not be successful unless enough attention is devoted to this

concern and the adaption process evolves gradually (Black & van Esch, 2020; Brock

& Wangenheim, 2019).

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5.2 Research Findings

By now, nothing else has remained to be written but the answers to the originally posed research

questions. The first research question, which is “What digital and online recruitment tools and

methods are there – with a main focus on the most commonly used ones –, what can they offer

and how can they facilitate organizations´ competitiveness?”, could be answered as follows:

every kind of modern digital and online recruitment tool is part of the so-called e-recruitment

(or electronic recruitment) which is a collection of human resource management activities and

hiring processes enabled and processed by diverse electronic means and IT technologies (Lee,

2011). E-recruitment methods can be divided in two main categories: in more or less automated

online recruitment processes and in employer branding activities (Lee, 2011). The former one

is mostly executed and supported by artificial intelligence-based technologies, whereas the

latter one generally takes place on social networking platforms. There are several methods for

both employer branding – which is the use of marketing activities to improve HR outcomes

(Ambler & Barrow, 1996) – and also for AI-based recruiting solutions. Due to the worldwide

presence of internet, organizations using erecruitment have an unprecedentedly wider reach

than companies using ineffective traditional recruitment methods. E-recruitment has made job

application and recruiting processes substantially easier and much faster which has resulted in

a considerable decrease in the amount of time necessary for applications (Lee, 2011).

Consequently, it has also led to a remarkable decline in recruitment-related expenses. Moreover,

with the help of employer branding, for which the best opportunity is the presence on different

kinds of social networking sites due to their inconceivable reach, organizations can call

attention to themselves and become popular(van Eeden, 2014). Another crucial benefit of social

media is its versatile applicability throughout different stages of recruitment processes

(Henderson, 2018). By engaging in these technologies, companies can with higher chance find

talented, knowledgeable and experienced prospective employees (Henderson, 2018), who have

87
been found to be the most valuable assets for organizations since they constitute key factors of

competitive advantage by their inimitability, rarity and irreplaceability (Delery & Shaw, 2001).

To make it more clear, talented, skillful employees account for the overwhelming majority of

an organizations´ value. Therefore, it is of utmost importance for organizations to find them.

That is exactly what e-recruitment technologies can help with. They make the identification,

attracting, recruiting and also retaining of such precious potential employees significantly easier

and faster by simultaneously also decreasing both recruitment-related and other company

expenses.

Furthermore, the answer to the second research question, which is “What kind of AI-based

recruiting technologies are there, what do they offer and how can they help organizations gain

competitive advantage?”, could be formulated in the following way: artificial intelligencebased

technologies build one key category within the framework of aforementioned erecruitment tools.

AI is a general term for machines capable of learning from experience and carrying out tasks

which are otherwise completed by humans (Jarrahi, 2018; Campbell et al., 2020). These

characteristics enable AI-based tools to help with things humans are not any more able to

overcome. At least not in a timely manner (Campbell et al., 2020). Such challenges are for

example the attraction, screening and interviewing of job applicants which AI can do

considerably faster and, in addition, more efficiently than HR practitioners could ever do.

Hiring managers can take advantage of AI-supported recruiting tools in almost every single

phase of recruitment processes. Countless types of AI-based solutions have already been created

from tools which gather initial information about job applicants and match those to advertised

vacancies, through tools which can help customize organizations´ presentation methods when

those address candidates or other technologies which deal with the rescreening of formerly

rejected applicants to the ones which conduct video-recorded interviews with applicants and

subsequently analyze their content (Black & van Esch, 2020). Moreover, AI can do all of these

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and further activities by helping applicants make progress throughout the entire recruitment

process (Black & van Esch, 2020). This enabling of automated recruitment procedures, in a

similar way to other e-recruiting methods, result in notable decline in placement process-related

expenditures and in a tremendous increase in the number of candidates. Additionally, by using

AI-based recruiting tools, organizations can also enhance the quality of their overall candidate

pool on the one hand and lower the time-to-hire ratio with up to 90% on the other hand (Black

& van Esch, 2020). This, too, leads to substantial savings in personnel costs. Even though AI

technologies are better at solving clearly defined problems and analyzing great amounts of data,

humans can still outpace machines in finding solutions for obscure, not well-structured

problems and abstract thinking. Therefore, it is important to note that AI-based technologies

should not be used in isolation but rather in cooperation with humans (Bolander, 2019), so that

the strengths of one party can compensate for the weaknesses of the other one and vice versa

(Jarrahi, 2018).

Finally, an essential issue companies should take into consideration is the choice of fundamental

organizational recruitment system. Irrespective of which e-recruitment technologies companies

eventually choose to implement, those should be integrated into a strategically oriented

recruitment system which incorporates a multi-level orientation whereby both organizational-

and individual-levels are differentiated and cross-level effects among these levels are regarded.

In this way, organizations can gain competitive advantage, facilitate their competitiveness and

take full advantage of the opportunities offered by the great variety of e-recruitment and

artificial intelligence-based technologies. To sum up, it can be said that organizations´ human

resource system as a whole should fundamentally be digitized. The sole use of one or only a

few modern digital recruitment-supporting technologies is however not enough. Corporate

structures, just like the rapidly changing markets nowadays, are particularly complex, diverse

and global. In order that organization can identify and employ the best talented individuals and

89
for the sake of a well-functioning organizational HRM system, companies should actively use

a wide range of digital and online recruiting tools.

5.3 Limitations and Research Outlook

Due to given formal criteria and extent limitations this thesis could unfortunately not cover all

the aspects of the issue e-recruitment and AI-based recruiting tools. Several further studies

could be conducted about related topics of modern recruitment methods and technologies. Two

main questions have arisen while I was writing my thesis which I subsequently could not find

information about, in other scientific articles I have read. It has been shown that strategically

oriented recruitment systems are not only more effective and comprehensive than are traditional

recruiting methods but also are they necessary prerequisites for a proper implementation and

application of digital online, as well as artificial intelligence-based recruiting tools. However, I

have not found any information about how the concrete implementation, and more importantly,

the organization-wide alignment of such strategic recruitment systems should take place. How

can organizations adjust their digital and online recruitment system to their middle and long-

term strategic goals? What technical, organizational or IT-related actions have to be taken.

Furthermore, how can or how should such technologies take multi- and cross-level effects of

recruitment into account? The second main question is what other – here not mentioned – AI-

supported recruitment tools are there, what are they capable of and how can they facilitate

organizational competitiveness? These are all important issues further research should find

answers for.

90
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