Chapter II

Human Resources Planning

In the modern times, planning the activities to attain the goals or objectives has become
very important in almost all the fields such as economics, political, business etc., Planning
involves selecting missions, objectives and the actions to achieve them. It requires decision-
making i.e., choosing from among the alternative future courses of an action or actions.
Panning provides a rational approach to achieving pre-selected objectives. Planning bridges
the gap from where one is to and where that one wants to go. It makes possible for things to
take place in the desired manner. Although, it is very difficult to predict the exact future and
although factors beyond control may interfere with the best-laid plans, unless we plan, we
are leaving events to chance. From this point of view, planning is an intellectually demanding
process, it requires consciously determined courses of actions and to base various decisions
on purpose, knowledge and considered estimates. Planning is essentially concerned with
future and since future conditions are unknown, forecasts or estimates must be made
properly to provide a basis for successful planning. In simple words, planning is deciding the
course of action to be followed for achieving the objectives.
So far as the business organisations are concerned, in all organisations, plans are
prepared for different functions such as purchasing, production, marketing, human resource
management, etc. and at various levels of management. However, implementation of the
plans depend to a greater extent on the available human resources in an organisation and
hence, suitable employees or human resources must be available in the organisation as per
the requirements. For making available suitable employees as and when they are needed,
Human Resource Planning', which is also known as 'Manpower Planning, is required to be
carried out. In this chapter, we have to study different aspects relating to Human Resource
Planning such as recruitment, selection, etc, Therefore, let us first try to understand the
meaning of 'Human Resource Planning' with the help of some definitions stated by the
experts in the field of Human Resource Management.
Definitions of Human Resource Planning
Human resource planning means deciding the number and type of human resources
required for each job, unit and the company in order to carry out organisational activities. It
is a process by which an organisation moves from its current manpower position to its
desired manpower position. It is influenced by the strategic management of the company.
Human Resource Planning, also known as 'Manpower Planning', involves identifying
staffing needs by analysing properly the available human resources and determining what
additions and/or replacements are required in order to maintain the staff of the desired size
and quality. It can be at different levels and for different purposes. At the national level,
manpower planning is done by the Government for economic development, such as
population projections, educational facilities, etc. Such manpower planning is also known as
macro-level planning.
According to Lean C. Megginson: "Human Resource Planning is an integrated approach
to performing the planning aspects of the personnel function in order to have a sufficient
supply of adequately developed and motivated people to perform the duties and tasks
required
to meet organisational objectives and satisfy the individual needs and goals of organisational
members."
According to E.B. Geisler: "Manpower planning is the process including forecasting,
developing and controlling, by which a firm has the right number of people, at the right
places,
at the right time; doing work for which they are economically most useful."
According to Eric W. Vetter: "Manpower planning is the process by which management
determines how the organisation should move from its current manpower position to its
desired
manpower position. Through planning, management strives to have right number of and the
right kind of people at the right place at the right time, doing things which result in, both the
organisational and the individual, receiving maxirnum long run benefits."
According to Coleman: "Human Resource or Manpower Planning is "the process of
determining manpower requirements and the means for meeting those requirements in order
to carry out the integrated plan of the organisation."
According to Strainer: Manpower Planning is "strategy for the acquisition, utilisation,
improvement and preservation of an enterprise's human resources. It relates to establishing
job
specifications or the quantitative requirements of jobs determining the number of personnel
required and developing sources of manpower."
According to Gordon MacBeath: "Manpower planning involves two stages. The first
stage
is concerned with the detailed planning of manpower requirements for all types and levels of
employees throughout the period of the plan and the second stage is concerned with Planning
of manpower supplies to provide the organisation with the right types of people from all the
Sources to meet the planned requirements."
According to James J. Lynch: "Manpower planning is "The integration of manpower
policies, practices and procedures so as to achieve the right number of the right people at the
right jobs at the right time."
W.s. Wistrom rightly pointed out in the Conference Board Report, "Manpower planning
Evolving System" that manpower planning can be seen as a series of activities consisting of
the following:
1. Forecasting future manpower requirements, either in terms of mathematical
projections of trends in the economic environment and development in industry or
in terms of judgement estimates upon the specific future plans of the company.
2. Making an inventory of present manpower resources and analysing and assessing
the extent to which these resources are employed optimally.
3. Anticipating manpower problems by projecting present resources into the future and
comparing them with the forecast of requirements to determine their adequacy, both
quantitatively and qualitatively.
4. Planning the necessary programmes of recruitment, selection, training, development,
utilisation, transfer, promotion, motivation and compensation to ensure that future manpower
requirements are properly met.
Objectives of Human Resource Planning
According Dale Yoder, objectives of HRP are:
(a) To establish and to recognise future job requirements.
(b) To assure supplies to qualified human resources.
(c) To develop available human resources.
(d) To utilise the current and prospective human resources.
(e) To decide a sound and suitable recruitment policy.
(f) To introduce effective labour cost reduction measures.
Apart from the above listed objectives, there are many important objectives which are listed
below:
1. Focusing on the Area where Human Resource is Required: There could be some
departments or sections in an organisation where there are less number of employees
appointed than required. In such cases present employees get burdened and lose interest in
their work. So it is the responsibility of the human resource planning department to see the
fulfilment of the requirement of the respective section, to generate efficient performance from
the employees.
2. Making Manpower Available as and when Required: In sectors like information
technology, attrition is the biggest problem. Finding and providing the right person, at the
right place and right time is crucial. In such cases the human resource planning department
should have a readymade plan for filling that position with the given budget. The human
resource planning department has to anticipate the number of employees required in future to
avoid delay.
3. Controlling the Cost of Human Resource: Making people happy with the same salary in
these high inflation times is a tough task for the human resource department. Manpower
planning tries to reduce labour costs, recruitment and replacement costs.
4. Providing Training and Development Programmes: To compete in the changing
technology, an organisation has to take initiative towards the employee development.
Analysing the future requirement of the company and finding the skill set requinred is the
basic objective of the organisation. This will make employees ready for the future changes
and organisations can save time on finding people from outside.
5. Coping up with Changes: HR planning is required to cope up with changes in the market
condition, technology, products and government regulations in an effective way.
Process of Human Resource Planning
1. Environmental Scanning: It monitors those external forces which influences the
organisation. Managers monitor economic factors, technological changes,
demographic changes, political and legal issues and social concerns. By scanning the
environment; organisations can take precautionary action to protect organisations
from future losses.
2. Organisational Objectives and Policies: Organisational policies are based
objectives. The number and type of employees could be decided as per ths
objectives of an organisation. After getting a clear understanding of the objectives
the HR department has to handle those concerns which management has for an
organisation.
3. HR Needs Forecast: An organisation has various demands which need to be fulfiled
from time to time. Demands / need forecasting can help in:
(a) Measuring the job requirements necessary for producing a given number of goods or
services.
(b) Determining the staff mix which is desirable in the future.
(c) Analysing the exact requirement of the staff for the respective sections or
departments so as to reduce costs.
(d) Maintaining and retaining potential employees for the benefit of an organisation.
(e) Monitoring compliance with legal requirements with regards to the reservation of
the job.
4. HR Supply Forecast: Forecasting of manpower supply is essential to meet the future
demands. It measures the number of people likely to be available from internal and
the external environment.
Internal Labour Supply: A profile of employees in terms of age, gender, education,
training, experience, job level, past performance and future potential should be kept
ready for use whenever required. Requirement of growth and transfers should also
be assessed in advance.
Internal sources are important for specific reasons:
(a) They carry forward the organisational culture.
(b) Internal mobility acts as a motivational factor.
(c) Fewer efforts are required on training of personnel.
(d) They are well aware of the policies and procedures of the company.
(e) Cost on recruitment is reduced.
External Labour Supply: When the organisation expands rapidly, they need to fulfil
the labour requirement from outside. There are various external supply sources like
consultants, advertisements, casual applications, candidates referred by current
employees, educational institutes etc.
External sources are important for specific reasons:
(a) Young candidates and new experience will be available.
(b) Organisation needs to replace lost personnel.
(c) Organisational growth and diversification creates the need to use external
sources to obtain additional number and type of employees
5. HR Programming: The focus of HR programming is to ensure that the vacancies
created through demand and supply forecast can be filled by the right persons, at
the right places, doing the right job, at the right cost. Thus the existing number of
personnel and their skills are compared with the forecasted needs of identified gaps
and the HR programme is prepared accordingly.
6. HR Plan Implementation: The human resource requirements need to be identified
along with the procedure to meet those requirements; this means preparing an HR
plan. It should be supported by relevant polices, programmes and strategies.
There are a number of HR strateqies:
(a) Recruitment Plan: It estimates the number and type of employees needed.
Special plans for recruiting the right person, at the right place and the right
method for recruiting them is decided.
(b) Redeployment Plan: It provides information about transferring or retraining
existing employees for a new job.
(c) Redundancy Plan: It finds out the areas of redundant jobs or where excess
employees are doing the same job. Finding out the redundancy will save the cost
of the company by retrenching them systematically.
(d) Training Plan: It estimates the number of trainees and apprentices required in
the present and future. It also gives an idea about the type of new courses to be
developed or changes required in present employees.
(e) Productivity Plan: This determines the reasons for employees' productivity and
mechanisation for improving productivity.
(f) Retention Plan: It indicates the reasons for employees' turnover and stipulates
strategies to avoid wastage through compensation policies, changes in the work
requirement and improvement in working conditions.
7. Control and Evaluation of Programme: Controlling the activities of human resource
needs to be verified through surplus and shortage of employees.
When there are surplus employees, retrenching of employees is needed which
indicates:
(a) Who is to be redundant, when and where.
(b) Plans for redevelopment or re-training.
(c) Steps to be taken for helping redundant employees to find new jobs.
(d) Policies for declaring redundancies and making redundancy payments.
(e) Programme for dealing with surplus labour by retaining all employees but
reducing the working hours.
Factors Influencing Estimation of Human Resources
1. Organisational Growth Cycle and Planning: When an organisation is undergoing a
growth stage, forecasting of manpower is essential. A mature organisation experiences less
flexibility and variability.
2. Environmental Uncertainties: Environmental uncertainty includes social, political and
economical changes which affect the organisation. Personnel planners deal with
environmental uncertainties by carefully planning, recruiting, selecting, training and
developing policies and programmes.
3. Time Horizon: In the long-term companies need to plan for their manpower supply.
Factors like short-run competitors, rapid changes in social and economical conditions and
unstable product or service demands affect organisation. There are also long-run strong
competitors, evolutionary changes, and strong management practices that affect an
organisation
4. Outsourcing: Normally organisations outsource the recruiting part so as to reduce the
wastage of time. These are non-critical activities which are sub-contracted to a third party. It
makes the process of recruiting and interviewing easy for HR. Today many outsourcing firms
are providing efficient services to organisations in turn saving huge amounts for them.
5. Labour Market: It includes a bunch of people possessing skills and abilities that can be
captured, as and when the need arises. India will need 30 million skilled workers by 2015 as
per the Confederation of Indian Industry (CI). Labour market affects HRP because the desired
skilled manpower may or may not be available. It hampers the growth and productivity of an
Industry. Efficiency may also reduce because of employing semi-skilled or unskilled workers.
6. Type and Quality of Information: For right forecasting, right information has to be
available. One of the major issues in personnel planning is availability of information which
can be used in marketing forecast. An organisation has to segregate the type of information
according to the level of application and scope of that information in future. For example:
Strategic Information includes information on product mix, customer mix, competitive
advantage, geographical constraints for expansion etc.
General Information includes information on organisational structure, information flow,
functional areas, supply and distribution channels, sales territories, changing technology etc.
and Specific Information includes information on job evaluation, skills inventories,
management inventories, recruitment sources etc.
Advantages of Human Resource (Manpower) Planning
Manpower Planning plays an important role at both micro as well as macro level. It is
found today that more complex technologies are functioning in economic, social, business
environments. As a result, the organisations face shortages of the right type of human
resources. Manpower planning enables to get the right type of personnel in the organisation.
Besides this, following points also throw the light on the importance of manpower planning:
(a) Manpower planning involves forecasting of manpower requirements in an
organisation and helps the management in-anticipating personnel shortages and
surpluses and also to develop the ways to avoid or correct problems before they
become serious. Further, forecasting of long-range manpower requirements is helpful
in forecasting the compensation costs involved in that connection.

(b) A proper and systematic forecasting of human resource requirements helps an

organisation to determine proper sources and methods of recruitment. Further, an
organisation can also adopt a proper selection procedure depending upon the needs
of the jobs. Proper tests can be designed for the purpose of selecting the right
candidates for the right jobs. Thus, importance of manpower planning is immense in
recruiting and selecting of the personnel.

(c) From the view point of training and development, the importance of manpower
planning is definitely great. Manpower planning ensures training of employees in an
organisation. Training involves imparting of knowledge and developing attitudes
skills, social behaviour, etc., of the employees. Manpower planning identifies the
training needs of the personnel of an organisation beforehand so that necessary
arrangements and training programmes can be chalked out accordingly to give the
training to the employees. Training helps the organisation to utilise its human
resources to the optimum. Manpower planning is not only important from the view
point of an organisation but also helps the employees of an organisation in
developing and in the application of skills, abilities, knowledge which affect their
capacity positively as for as efficiency, earnings, etc., are concerned.

(d) So far as performance appraisal is concerned, manpower plays an important role in

that area too, Performance appraisal refers to identification of strengths and
weaknesses of the employees of an organisation relating to their jobs. It is conducted
to know whether the existing human resources possess the necessary qualities and
qualifications as per the requirements of the jobs. Manpower planning makes
available necessary strategies to correct the weaknesses of the employees by making
the proper arrangements for corrective training, retraining, orientation programmes.
As a matter of fact, all these are inter-related activities.

(e) Importance of manpower planning is none-the-less in respect of controlling the

labour costs, Efforts are made in manpower planning to assure the timely and
sufficient supply of labour, thus, avoiding the shortages and surpluses of labour
which leads to save and control labour costs.

(f) Manpower planning facilitates career development of employees. Career

development refers to development of the career of the personnel employed in an
organisation. Taking into consideration the long range plans of the organisation,
manpower planning can be done. The plans are made known to the employees who
can plan their career accordingly within the organisation. This leads to further
development of employees and motivates them. This role of manpower planning is
very important.

(g) An organisation develops properly only when there are better results in the form of
higher productivity and efficiency. Manpower planning ensures organisational
development from this point of view. If manpower planning is done properly and
systematically, problems of low productivity, absenteeism, inter-departmental
conflicts, resistance to change, etc., can be tackled and solved efficiently.
Thus, it can be said that manpower planning definitely helps to increase the prospects of
an organisation in managing its resources in a better way and coping more effectively with
dynamic situations.
Limitations of Human Resource Planning
Though manpower planning is an important tool in the hands of management and is
quite useful, it suffers from certain limitations. These limitations basically arise from the
uncertainty of predictions, methods used, etc. Important limitations of manpower planning
are as follows:
(a) The most important inherent limitation of manpower planning lies with the
forecasting. Future is uncertain and changes in technology, economic conditions,
political situations, working conditions and business environments, etc., cannot
always be anticipated accurately and long-range forecasts made accurately. As the
degree of uncertainty varies, so does the style, the scope and efficacy of manpower
planning change.
(b) Management can predict as to how many vacancies can be created in future with a
reasonable degree of accuracy resulting from retirements. But deaths and
resignations of the employees cannot be predicted and hence, it becomes very
difficult to anticipate as to which particular employee will be required to be replaced.
n that respect, planning may not be done accurately and certain steps cannot be
taken as far as new recruitments are concerned.
(c) Another important difficulty in manpower planning arises on account of top
management. Sometimes, top management remains reluctant and does not support.
The lack of interest on the part of the top management may lead to frustration in the
personnel concerned involved in manpower planning.

Job analysis and job design

Job analysis and job design are two critical aspects of human resource management that play
a key role in ensuring organizational effectiveness and employee satisfaction. Here’s a
breakdown of both concepts:
Job Analysis
Job Analysis is the process of systematically studying a job to understand its components,
requirements, and the conditions under which it is performed. This process helps in creating
job descriptions and specifications. Key aspects include:

1. Purpose: To gather information about the tasks, responsibilities, skills, and qualifications
required for a job. This helps in aligning roles with organizational goals and ensuring that
hiring, training, and evaluation processes are based on accurate data.

2. Methods:
- Interviews: Talking with employees and supervisors to gather insights about the job.
- Questionnaires/Surveys: Distributing structured forms to collect information from a larger
group.
- Observation: Directly watching employees perform their tasks to understand job demands.
- Work Diaries/Logs: Having employees record their daily activities and tasks.
3. Outcomes:
- Job Description: A written statement detailing the job's duties, responsibilities, and work
conditions.
- Job Specification: A summary of the qualifications, skills, and attributes required for the
job.

4. Uses: Helps in recruitment, selection, training, performance evaluation, and compensation

management. It ensures that the right people are hired and developed for the right roles.

Job Design
Job Design is the process of organizing tasks, duties, and responsibilities into a productive
unit of work. The aim is to enhance job satisfaction, productivity, and performance by
structuring the job in a way that aligns with both organizational needs and employee
motivation. Key elements include:

1. Purpose: To create jobs that are motivating and satisfying for employees while meeting
organizational needs effectively. This can lead to higher performance, reduced turnover, and
improved job satisfaction.

2. Techniques:
- Job Enlargement: Increasing the number of tasks in a job to make it more varied.
- Job Enrichment: Adding elements to a job that make it more rewarding, such as greater
autonomy, responsibility, and opportunities for personal growth.
- Job Rotation: Moving employees between different jobs to increase variety and skill
development.
- Job Simplification: Breaking down tasks into smaller, more manageable parts to improve
efficiency and reduce complexity.

3. Approaches:
- Mechanistic Approach: Focuses on job specialization and efficiency, often seen in
repetitive or manufacturing jobs.
- Biological Approach: Considers physical and ergonomic factors to reduce strain and
enhance physical well-being.
- Perceptual-Motor Approach: Aims to design jobs that align with human capabilities and
limitations to prevent errors and increase productivity.
 - Motivational Approach: Emphasizes designing jobs to fulfil psychological needs, such as
autonomy, feedback, and variety.

4. Outcomes:
- Increased Job Satisfaction: By making jobs more engaging and fulfilling.
- Enhanced Productivity: Through well-structured roles and responsibilities.
- Lower Turnover: By improving employee engagement and reducing job dissatisfaction.
Job analysis provides the foundation for understanding the requirements and responsibilities
of a job, while job design focuses on structuring and organizing jobs to enhance satisfaction
and performance. Both are interrelated and essential for effective human resource
management.
Recruitment
Concept of Recruitment
Recruitment is the process of finding and hiring the best-qualified candidate for a job
opening, in a timely and cost-effective manner, from within or outside of an organisation. The
recruitment process includes analysing the requirements of a job, attracting employees to
that job, screening and selecting applicants, hiring and integrating the new employee in to
the organisation.
Definitions of Recruitment
(a) Edwin Flippo: "Recruitment is the process of searching for prospective employees and
stimulating them to apply for jobs in the organisation ".
(b) Dale Yoder: "Recruitment is a process to discover the sources of manpower, to meet
the requirements of the staffing schedule and employ effective measures for attracting
the manpower in adequate numbers, to facilitate selection of an effective working force".
(c) Werther and Keith: "Recruitment is the process of finding and attracting capable
applicants for employment. The result is a pool of applicants from which new
employees are selected”
(d) Dale S. Beach: "Recruitment is the development and maintenance of adequate
manpower resources and it involves the creation of a pool of available labour upon
whom the organisation can depend when it needs additional employees"
(e) William F. Glueck: "Recruitment is that set of activities which an enterprise uses to
attract job candidates who have the abilities and attitudes needed to help the
enterprise to achieve the objectives".
(f) Plumbley: "Recruitment is a matching process and the capacities and inclinations of
the candidates have to be matched against the demands and rewards inherent in a
given job or career pattern".
From the above-mentioned definitions stated by the experts in the field of human
resource management, we come to know the following important points so far as the
recruitment is concerned.
1. Recruitment is the important process of attracting applicants with certain capabilities,
skills, attitudes etc., to job vacancies in an organisation.
2. Recruitment helps to develop and maintain adequate manpower resources.
3. Recruitment helps to create a pool of applicants from which new employees can be
selected.
4. Recruitment is a matching process.
5. Recruitment lays foundation for selection of employees.
6. Recruitment is a two-way process. It helps both i.e., a recruiter and a recruitee.
A recruiter gets a choice as to whom to recruit from among the pool. While a
recruitee also can decide whether he should apply for the job in the organisation
considering his abilities, future prospects and his expectations.
Objectives or Purposes of Recruitment
There are various objectives or purposes of recruitment. Following are some of the
important objectives or purposes of recruitment:
1. To attract candidates having the desired qualities and qualifications to meet the
organisation's present and future needs.
2. To create a pool of candidates with minimum cost.
3. To fill the vacancies created in the organisation due to promotions, termination,
transfers, retirements etc., as well as due to expansion, diversification etc.
4. To help the selection process to become successful.
5. To ensure that the candidates will not leave the organisation at least in the short
period once they are selected.
6. To create and develop organisational and individual effectiveness in short as well as
in the long-run and also to develop an organisational culture which may help attract
the competent people towards the organisation.
7. To help evaluate the effectiveness of various recruitment techniques and sources for
various types of job applicants.
Recruitment Policy
Recruitment policy makes the objectives and principles of recruitment clear and also
provides a framework for implementation of recruitment programmes and procedures.
Any recruitment policy should comprise the points listed below:
1. Meeting objective of the company in the given time span i.e. short term and long
term.
2. Identifying the need for recruitment.
3. Recruiting staff with the appropriate skills in order to satisfy the needs of the job.
4. Conducting recruitments centrally or de-centrally.
5. Keeping recruitments in line with the company's annual business plan.
6. Filling the positions through Internal or External sources.
7. Specifying the degree of flexibility with regards to skills, qulification and abilities.
8. Determining the criteria of selecting employees.
Sources of Recruitment
1. Internal Sources of Recruitment
The internal sources of recruitment refer to sources within an organisation and these are
the most obvious sources. Whenever vacancies occur, suitable employees already employed
in an organisation are promoted, transferred or sometimes demoted. Sometimes, retired
managers and other employees are also invited to fill the vacancies; especially for a short
duration (e.g. leave-vacancies). Promotions and transfers are considered as good sources of
recruitment.
Thus, recruitment can be done from the present permanent or temporary employees and
retrenched or retired employees. Even the dependents of deceased, disabled, retired and
present employees can also be considered for this purpose.
Types of Internal Recruiting
Internal sources include personnel already on the pay-roll of the organisation. Whenever
any vacancy arises, a suitable candidate from within the organisation may be looked at.
Organisations consider the candidates from this source for higher level jobs due to
availability of most suitable candidates for jobs, to meet the trade union demands and due to
the policy of the organisation to motivate the present employees. The internal types of
recruitment are as follows:
(a) Promotion: Promotion means shifting an employee to a higher position, carrying
higher responsibilities, facilities, status and salary. Various positions in an
organisation are usually filled up by promotion of existing employees on the basis of
merit or seniority or a combination of both.
(b) Transfer: Transfer refers to a change in job assignment. It may involve a promotion
or demotion or no change in terms of responsibility and status. A transfer may be
either temporary or permanent, depending on the necessity of filling jobs. Promotion
involves upward mobility while transfer refers to a horizontal mobility of employees.
(c) Ex-employees: Ex-employee means persons who have worked in the enterprise and
have left the organisation and are eager to return. Such employees with a good
record may be preferred. They require less initial training.
(d) Employee Recommendations: In order to encourage existing employees, some
concerns have made a policy to recruit staff from the applicants introduced and
recommended by employees or employees' union. Also, preference is given to friends
and relatives of existing employees.
Advantages of Internal Sources of Recruitment:
An organisation recruiting employees from internal sources has certain advantages.
Some of them are given below:
(a) It is time saving and economical as advertisement for the jobs is not required to be
given in external media. Cost of selection is also reduced.
(b) It helps to reduce the executive turnover.
(c) The internal candidates are well versed with policies, rules and regulations of the
organisation and as, a result, cost of training, induction, orientation, period of
adaptability to the organisation etc. can be reduced considerably.
(d) It helps to improve the morale and motivation of employees of the organisation and
to develop loyalty towards the organisation and a sense of responsibility.
(e) As the management has better knowledge of the strengths and weaknesses of its
employees, proper decisions can be taken to promote or to transfer or to demote
and thereby, the chances of making wrong decisions are considerably reduced.
(f) It encourages employees to work hard, sincerely and to put in more efforts to get
promotions.
Disadvantages of Internal Sources of Recruitment:
Though there are certain advantages of recruitment from internal sources, it also suffers
from some disadvantages as mentioned below
(a) This source of recruitment limits the scope for selection and in addition, there is
possibility of not finding the personnel of required qualities within the organisation
(b) It prevents the suitable outside candidates with innovative ideas, fresh and
constructive thinking and dynamism, from entering the organisation
(c) If the present employees are promoted or transferred to other posts, their posts get
vacant and filling their vacancies may be difficult and then the external sources need
to be reached.
(d) There can be bias or some sort of partiality in promoting or transferring the
employees from within the organisation which may have adverse effect on the
functioning of it. Further, it leads to generation of a feeling of discontent among the
employees who are not promoted. Unhealthy competition for promotions or
transfers affects the morale, performance and motivation of employees adversely.
It should also be noted that excessive dependence on internal sources is dangerous.
2. External Sources of Recruitment
The external sources of recruitment refer to all such sOurces which are outside the
purview of an organisation. Important external sources are as mentioned below.
(a) Advertising: Advertising in newspapers and periodicals is one of the most important
methods of recruitment, especially for recruitment of management and technical
personnel. The company needing manpower advertises details about the job, its
requirements, salary, perquisites, duties and responsibilities etc. The advantage of
advertising is that all the details about the job can be given in advertisement, to allow
self-screening by the prospective candidates. Advertisement gives the management a
wider range of candidates to choose from. Its disadvantage is that it brings large
number of applications whose screening costs may be quite heavy.
(b) Employment Agencies: There are government as wel as private employment
agencies providing a nation-wide or area-wise service in matching personnel demand
and supply. In India, there are employment exchanges and bureaus which provide a
range of services. In some cases, compulsory notification of vacancies to the
employment exchange is required by law. Employment seekers get themselves
registered with these exchanges. The employment exchanges bring the job-givers in
contact with job-seekers. Employment exchanges are very useful, particularly in the
field of unskilled, semi-skilled and skilled operative jobs. However, in the technical
and professional areas, private consultancy firms provide recruitment facilities. In big
cities, there are several such agencies, prominent among them are: Randstad, Kelly
Services, Manpower Consultants, A. F. Ferguson and Company, ABC Consultants etc.
© Gate Hiring: In a country like ours, where there are a large number of unemployed
people, it is usual to find job-seekers thronging the factory gates. Whenever workers
are required, people who are present at the gate are recruited in necessary numbers
This method can be used safely for unskilled workers. In some industries, a large
number of workers work as badli or substitute workers. Whenever a permanent
worker is absent, a substitute is employed in his place from among the people
present at the gate.
(d) Educational Institutions: Direct recruitment from colleges and universities is
prevalent for in western countries on a large scale as compared to India. Many big
organisations maintain a close liaison with educational institutions for recruitment to
various jobs. Various recruiting groups develop systematic university recruiting
programmes. They hold preliminary on-campus interviews and select some students
for final interview mostly at their offices.
(e) Labour Unions: In many organisations, labour unions are regarded as a source to
recruit manpower. This facilitates increasing the sense of cooperation and in
developing better industrial relations. But sometimes trade unions support a
candidate who is not suitable for the job and not acceptable to the management.
This weakens the labour relations.
(f) Field Trips: An interviewing team makes trips to towns and areas which are known to
contain the kinds of employees required by the enterprise. Arrival dates and the time
and venue of interview are advertised in advance.
Advantages of External Sources of Recruitment:
(a) It helps to attract and introduce new talent in the organisation which makes the
organisation more dynamic through the inflow of innovative ideas, fresh thinking,
drive etc.
(b) The best candidates can be selected. It offers wider scope for the selection of
employees as there is a possibility that a large number of candidates with the
requisite qualities, qualifications and experience may apply for the jobs advertised.
(c) Employees can be selected without pre-conceived ideas, partiality or reservations.
(d) Labour costs can be minimised by selecting the employees on minimum pay scales.
(e) This source proves to be more economical if experienced, well-trained candidates are
selected.
Disadvantages of External Sources of Recruitment the company needs to advertise:
(a) It sometimes proves to be expensive, if the company needs to advertise on a large
scale and also because of heavy costs of making arrangements for interviews, tests
etc.
(b) It is a time consuming and involves a lengthy selection process.
c) The task of attracting. contacting and evaluating the potential employees is
somewhat difficult and strenuous.
(d) It creates unhappiness among the existing employees who feel that they are qualified
and fit for the jobs but are not provided with the opportunity. It does not help to
develop loyalty among the existing employees.
(e) As newly recruited employees are not familiar with the policies, practices, procedures,
environment etc., of the organisation, they take some time to adjust themselves. If
they take more time to adjust or if they cannot adjust themselves, valuable time is
wasted and costs also increase.
As far as internal and external sources of recruitment are concerned, every organisation
has a number of alternative sources for recruitment purposes. However, it should be noted
that the best source to tap first is the internal one and then the external. But, in practice, the
choice of internal or external source depends to a large extent upon various factors such as:
nature of jobs, skills and capabilities required, time available for selection, costs involved,
policy and practices of an organisation, situations prevailing in the labour market etc.
Methods or Techniques of Recruitment
Various recruitment sources already studied indicate when and where the human
resources can be procured while recruitment methods or techniques throw light on how the
various sources are to be tapped. Recruitment methods are in fact the media or means by
which an organisation can contact prospective employees and help to provide necessary
information, to exchange ideas and also to stimulate the potential employees to apply for the
jobs. An organisation can use different types of methods to stimulate internal as well as
external candidates. Prof. J. D. Dunn and Prof. E. C. Stephens summarised the recruitment
methods into three broad categories which are discussed below:
[A] Direct Methods:
Under these methods, job seekers are contacted directly through educational institutions
by way of campus interviews. Usually, placement bureaus or offices of the educational
institutions provide assistance in attracting job seekers, make arrangements for interviews.
Sometimes, recruitees are attracted to attend seminars, conventions at some suitable centres.
Some business organisations directly solicit the information with a view to recruit required
personnel from the teachers concerned, professors about the students having outstanding
records. We generally find campus interviews for M.B.A. students, Engineering students.
[B] Indirect Methods:
Advertisements in publications such as newspapers, trade journals, magazines, technical
and professional journals etc., are the important and most frequently used indirect methods
of recruitments. We also find advertisements for recruitment on radio, television.
Advertisements have proved to be very useful for recruiting blue collar and white cola.
personnel as well as scientific, technical and professional employees. Of course, the choice
media, timing, place of the advertisements, appeals to job seekers etc., determine the
efficiency of advertisements. Advertisement is required to be done in order to be effective
and it should give proper and clear-cut idea about the organisation, nature of jobs, job
requirements etc.
[C] Third Party Methods:
Out of the methods and sources of recruitment mentioned above, a proper method and
source is required to be adopted by the organisation. Selection of the best candidate is
possible only when maximum number of suitable candidates applies for the post and hence
it is necessary that the method and source of recruitment used should become successful in
attracting all such candidates to the organisation. It is also important to decide when the
process of recruitment should be started. Depending upon the time required to receive the
information from the candidates and the time needed to complete the selection procedure,
the recruitment work must begin sufficiently in advance. If the total time required for the
recruitment and selection procedure is say, two months and if the post is to be filled at the
beginning of September, it becomes clear that the process of recruitment must be started in
July.
Traditional vs Modern Recruiting Methods
Private employment agencies, public employment exchanges, employee referrals, trade
unions etc, are the mediums through which employees can be recruited. These organisations
or institutions are included in the third party methods. In fact, they work as mediators
between job seekers i.e., employees and business organisations i.e., employers in order to
bring them together. Private agencies charge certain fees for the services they render.
Sr.no Traditional Method Modern Method

1 It includes trade journals, magazines, It includes social Networking sites;

professional journals, Consultancies, online job websites, head hunting,
private agencies, public employment poaching, Use of Internet tools and
exchanges, employee referrals, trade service are the booming ways for
unions etc. the recruitment.

2 It is more time and cost consuming process Modern methods save time of
recruiter as well as job seeker

3 Newspaper, TV, Radios, Publications, Fixed low cost hiring, online job
journals are the traditional recruitment portals, e-recruiting, campus
channels. recruitment with the internship are
the modern recruitment channels
4 Company is associated with many Employers are associated with
consultancies or agencies for their online job portal by paying their
external recruitment. fees to get CV'S as per mentioned
criteria.

5 Direct, Indirect or third party recruitment E-Recruitment involves usage of

involves huge time, money of not only one internet tools and services for
personnel but a team. recruitment of required individuals.
It involves skimming through
online job portals, job boards
like craigslist and getting services
of low cost hiring firm to hire
candidates.

6 Unlike poaching employees are retained Poaching is no more considered as

with the companies' best practices of unethical to attract employee by
retention. giving them better salary
amenities.

7 Trade journals, magazines, professional Head Hunting for top level

journals are used for top levels and managers and executives is a
executives modern approach

8 Example: Advertisement in Newspapers, Example of social networking sites

 radio TV, employment exchange etc. for the recruitment: LinkedIn.
Online job seeking websites like
Monster.com, Naukri.com

Concept of Selection
Selection is the process of selecting a qualified person who can successfully do a job and
deliver valuable contributions to the organisation. It is a system which depends on job
analysis. This ensures that the selection criteria are job related.
The requirements for a selection system are knowledge, skills, abilities and other
characteristics, known as KSAOs. Personnel selection systems employ evidence-based
practices, to determine the most qualified candidates and involve both the newly hired and
those who can be promoted from within the organisation.
Two major factors that determine the quality of newly hired employees are: predictor
cut-off and selection ratio.
i)Predictor Cut-off: The predictor cut-off is a test score differentiating those passing
selection measure from those who do not. People above this score are hired or arms
further considered while those below it are not
(ii) Selection Ratio: It is a ratio that indicates the selectivity of an organisation from a
range of 0 to 1. The selection ratio (SR) is, the number of job openings (n) divided by
the number of job applicants (N). This value will range between 0 and 1, reflecting
the selectivity of the organisation's hiring practices. When the SR is equal to 1 or
greater, the use of any selection device has little meaning. But this is not often the
case as there are usually more applicants than job openings. Finally, the base rate is
defined by the percentage of employees thought to be performing their jobs
satisfactorily following measurement. After using these tools a person is selected for
the job.
Importance of Selection
1. To meet Equal Employment Opportunity (EEO) Requirements: This gives equal
employment opportunities to all aspirants for that job. Job descriptions need to be
written in a manner that is non-discriminatory with regard to age, race, gender,
national origin and religious beliefs.
2. To Maintain Corporate Image and Success: Some companies may choose
employees based on the necessary knowledge, skills and abilities, to perform the job
at a minimal of acceptable performance. Employees who perform at a higher level of
competence may be considered most valuable performers and are rewarded
accordingly. Since above-average employees may be instrumental in driving success,
the company may initiate a rather comprehensive hiring process. This process may
include several interviews, background checks, skills testing, health check-up, drug
testing and reference checks. The company image is at stake while attracting top
applicants. Therefore, receptionist, interviewers and company executives strive to
make a good impression.
3. For Employee Security: Every employee has a basic right to work in a safe
environment. Therefore, some companies have clearly defined policies regarding
safety, health and security in the workplace. The selection process should include the
conscience of the company and every person hired needs to be carefully screened for
it. Some companies have third-party vendors that perform criminal background
checks. Required drug tests can identify any potential drug abuse issues prior to
employment.
4. For Employee Retention: Companies with a well designed employee selection
process, understand the importance of retaining these valuable assets. The selection
process should be the continuous improvement plan with development programmes
like leadership, problem solving and employee rewards programmes like outstanding
performance, bonus plans, recognition functions and succession planning.
5. For Reducing Employee Turnover: Proper selection will reduce employee turnover.
A proper candidate will immediately get adjusted with the environment and would
not want to leave the organisation in the short term.
6. Ensures Proper Utilisation: Proper selection facilitates optimum use of physical and
human resources. A proper candidate ensures the proper utilisation of other resources.
Procedure for Selection
Every organisation has a different method of selection due to its nature, size and style of
operation. It also differs according to the posts to be filled in.
The selection process includes the following steps.
(i) Initial Screening: The first step in the selection process is the screening proces
Many candidates get dropped during the initial screening. This step makes the
filtration process of candidates easier.
(ii) Completed Application: Blank application forms are provided for getting detailed
information about the applicant. The application should typically contain
biographical data, educational qualifications, work experience, extracurricular
activities, special awards, praise received or other important information etc
There are some mandatory fields which an applicant cannot keep blank. The officer
should check all the details before accepting the application.
(iii) Employment Tests: Companies have different types of tests according to the leve
and nature of candidates required.
Employment tests vary from job to job. For example, for recruitment of Marketing
Executives, physical appearance or smartness gets preference whereas for an HR
executive recruitment and managing abilities get priority.
Knowledge tests, Performance tests, Psychological tests, Attitude tests, Honesty
tests, Medical tests are some examples of tests which are conducted during the
selection procedure.
(iv) Comprehensive Selection Interview: Comprehensive selection interview is a
formal, in-depth conversation conducted to evaluate an applicant's acceptability.
The management seeks answers to some basic questions like - Will the applicant do
the justice to the job? and How is the applicant as compared to the other
applicants? Selection interview is the most widely used selection technique. It can
be adapted for selecting unskilled, skilled, managerial and staff employees. They
also allow a two-way exchange of information. Interviewers learn about the
applicant and the applicant learns about the employer.
Types of Interview:
 Individual Interview: The supervisor of the vacant position takes the interview.
The interviewee faces only one person.
 Group Interview: The applicant faces two or more interviewers, allowing all the
interviewers to evaluate the individual at the same time. Sometimes two or
more applicants are interviewed together by one or more interviewers. This is
also called as group interview.
 Unstructured Interviews: This interview allows interviewers to develop
questions as the interview proceeds. The interviewer takes up the discussion
topics as they arise, trying to simulate friendly conversation. This approach
however, may overlook key areas of the applicant's skills or background.
 Structured Interviews: Sometimes management applies structured or directive
interviews. In this type the interviewer relies on a predetermined set of
questions. The questions are developed before the interview begins and are
asked to each applicant.
(v) Background Verification if Required: All sorts of certificates of the applicant are
to be checked by the HR manager at this stage. At least two references are needed
in order to verify the applicant.
(vi) Medical Examination: The selection process also includes a medical evaluation of
the applicant before the hiring decision is made. Normally, the evaluation consists
of filling a health checklist that asks the applicant to indicate health and accident
information and undergoing various medical tests at the prescribed hospitals.
(vii) Supervisory Interview: The ultimate responsibility of the success of a newly hired
worker lies with his immediate supervisor. The supervisor is able to evaluate the
applicant's technical abilities. The HR department provides a supervisor with the
best pre-screened applicants available and the supervisor decides whom to hire
from those.
(viii) The Final Hiring Decision: Regardless of whether the supervisor or the HR
department makes the final hiring decision, hiring actually ends the selection
process, assuming that the candidate accepts the job offer. To maintain good public
relations the company should notify applicants who are not selected.
Standards for Selection Test
A test is basically an assessment of person's knowledge, experience, attitude, behaviour
etc. Care should be taken while selecting tests and they should fulfil the requirements
mentioned below.
1. Reliability: Test scores should not change under the varying condition. If it is
administered to the same individual repeatedly, he should get approximately the
same score. Reliability is the measurement to check the same result over time.
HR manager should see the following types of reliability:
(i) Test-Retest Reliability
(ii) Inner Rate Reliability
(iii) Intra Rate Reliability
2. Validity: Validity, is the extent to which an instrument measures what it intends to
measure. For example, it is used to measure the speed and accuracy of a typist. To
determine whether it really measures the speed and accuracy of a typist's is to
demonstrate its validity.
There are three types of validity which are very important
(i) Content Validity
(ii) Construct Validity
(iii) Criteria related Validity
3. Qualified People: Tests require a high level of professional skills in their
administration and interpretation.
4. Preparation: A test should be well prepared. It should be easily understood and
simple to administer.
5. Suitability: It should suit the group to which it is applied.
6. Usefulness: The selected test should be useful to the organisation. More than one
test should be applied to avoid criticism.
7. Standardisation: Norms for finalising test scores should be established. There must
be prescribed methods and procedures for administering the test and for scoring or
interpreting it.
Distinction between Recruitment and Selection
Recruitment and selection are the two phases in the employment process used by any
organisation. They are complementary to each other. Due to recruitment process,
information about the persons suitable for a certain post and who are willing to work at the
post becomes available to the organisation and by following the selection process, the
organisation selects and employs the best person out of those who have applied for the
post. Selection is thus concerned with identifying the right person for the job out of all those
who are willing to offer their services to the organisation. If the organisation expects to
obtain the best human resource as its employees, it is required to make use of a scientific
selection procedure.
Selection necessarily follows recruitrnent. Recruitment is the generating of applications or
applicants for specific jobs, while selection is the process of offering jobs to one or more of
them. According to Edwin B. Flippo, recruitment is a positive activity and selection is a
negative activity. He states in his book, 'Personnel Management', that, "Recruitrnent is a
process of searching for prospective employees and stimulating and encouraging them to
apply for jobs in an organisation. It is often termed as positive in that it stimulates people to
apply for jobs to increase the 'hiring ratio' i.e. the number of applicants for a job. Selection,
on the other hand, tends to be negative because it rejects a good number of those who
apply, leaving only the best to be hired manner:
The distinction between Recruitment and Selection is made clear in the following
manner:
Sr.N Recruitment Selection
o
1. Recruitment is the process of searching Selection is the process of
for prospective and it helps to create a choosing the most suitable
pool of applicants from which certain candidates from those who apply
required number is selected. for the job. It is a process of
offering jobs to desired candidates.

2. Recruitment precedes selection. Selection follows recruitment.

3. Recruitment is a positive activity. Selection is a negative activity.

4. Specification of job requirements, Screening, application conducting

identification of vacancies, identification interviews, medical and reference
of target population etc., are the steps checking, selection decision etc.,
involved in the recruitment process. are the steps involved in selection
process.

5. For recruitment, internal and external Selection of the candidates is done

Sources are available for target population out of target population.

6. The main purpose of recruitment is to attract The main purpose of selection is to

as many candidates as possible. select the most suitable candidates
from amongst the applicants.

7. Recruitment process is less Selection process is lengthier and

consuming than selection process. more time-consuming.

8. Recruitment is less expensive than selection. Selection is more expensive than

recruitment.

9. Selection is subjective as there can

Recruitment is more objective in nature be favouritism and bias in selecting
the candidates.

10. Recruitment is less complicated, on the basis Selection is more complicated

of present circumstances and future plans, process which requires expertise to
jobs can be advertised. conduct tests and interviews.
Recruitment can be a complex process, and both challenges and best practices are crucial to
navigating it effectively. Here’s a breakdown of some common challenges and corresponding
best practices:
 Challenges
1. Talent Shortage
- Problem: Finding qualified candidates for specialized roles can be difficult, especially in
competitive industries.
- Solution: Expand your search to include passive candidates, utilize niche job boards, and
build relationships with industry organizations.

2. High Turnover Rates

- Problem: Frequent employee turnover can disrupt operations and increase recruitment
costs.
- Solution: Invest in employee retention strategies such as competitive compensation,
career development opportunities, and a positive work culture.

3. Unconscious Bias
- Problem: Bias in recruitment can lead to a lack of diversity and missed opportunities for
qualified candidates.
- Solution: Implement structured interviews, use diverse hiring panels, and adopt blind
recruitment practices to minimize bias.

4. Cultural Fit vs. Skills

- Problem: Balancing the need for candidates who fit the company culture with those who
have the necessary skills can be challenging.
- Solution: Clearly define your company’s core values and ensure that these values align
with your recruitment criteria. Use assessments to evaluate both cultural fit and skills.

5. Inefficient Recruitment Processes

- Problem: A slow or disorganized recruitment process can lead to losing top talent to
faster-moving competitors.
- Solution: Streamline your recruitment process by using applicant tracking systems (ATS),
automating routine tasks, and setting clear timelines for each stage.

6. Candidate Experience
 - Problem: A poor candidate experience can damage your employer brand and make it
harder to attract top talent.
- Solution: Communicate regularly with candidates, provide timely feedback, and ensure
that the application process is user-friendly and respectful.

 Best Practices
1. Develop a Clear Job Description
- Why: A well-crafted job description helps attract the right candidates and sets clear
expectations.
- How: Be specific about job responsibilities, required skills, and qualifications. Highlight
opportunities for growth and the impact of the role within the company.

2. Leverage Data and Analytics

- Why: Data-driven decisions can improve recruitment outcomes and efficiency.
- How: Use analytics to track key metrics such as time-to-fill, cost-per-hire, and source of
hire. Adjust your strategies based on what the data reveals.

3. Build a Strong Employer Brand

- Why: A positive employer brand attracts high-quality candidates and differentiates your
company from competitors.
- How: Showcase your company culture, values, and employee testimonials through
various channels like social media, your careers page, and company events.

4. Utilize Technology and Automation

- Why: Technology can streamline the recruitment process and improve efficiency.
- How: Implement tools such as ATS for managing applications, AI for screening resumes,
and video interviewing platforms for remote assessments.

5. Focus on Diversity and Inclusion

- Why: Diverse teams are shown to drive innovation and better performance.
- How: Develop diversity recruitment strategies, provide training to minimize bias, and
ensure inclusive language in job postings.

6. Engage with Passive Candidates

- Why: Passive candidates (those not actively looking for a job) can be highly skilled and
valuable.
 - How: Build talent pools, engage with potential candidates through networking, and
maintain relationships through regular updates and personalized communication.

7. Offer Competitive Compensation and Benefits

- Why: Attractive compensation packages are crucial for attracting and retaining top talent.
- How: Regularly benchmark your salaries and benefits against industry standards and
adjust as needed. Consider offering non-traditional perks like flexible work arrangements.

By addressing these challenges with effective strategies and adopting best practices,
organizations can enhance their recruitment efforts, improve candidate experience, and build
a stronger, more capable team.