{"id":161,"date":"2019-07-10T16:32:44","date_gmt":"2019-07-10T16:32:44","guid":{"rendered":"https:\/\/courses.lumenlearning.com\/wm-humanresourcesmgmt\/?post_type=chapter&p=161"},"modified":"2024-04-25T01:23:20","modified_gmt":"2024-04-25T01:23:20","slug":"putting-it-together-recruitment-and-selection","status":"publish","type":"chapter","link":"https:\/\/courses.lumenlearning.com\/wm-humanresourcesmgmt\/chapter\/putting-it-together-recruitment-and-selection\/","title":{"raw":"Putting It Together: Recruitment and Selection","rendered":"Putting It Together: Recruitment and Selection"},"content":{"raw":"Given labor market trends and the accelerating pace of technology, recruiting is becoming a mission-critical. As highlighted in PwC\u2019s Talent Trends 2019 report, 80% of CEOs identified a skills gap as a threat to growth, with those who were \u201cextremely concerned\u201d about the availability of key skills, citing the negative impact on innovation (55%) and people costs (52%), among other factors.[footnote]\"Talent Trends 2019<\/a>.\" PwC. 2019. Accessed July 26, 2019.[\/footnote] PwC notes that respondents level of concern has increased over the last five years with the emergence of new technologies.\r\n\r\nTo put the upside in perspective, Oracle reports that the financial impact of hiring a top performing employee is estimated to be 10\u2013100 times that of a person\u2019s compensation. Let\u2019s do the math: Hiring a single high-impact employee at an annual salary of $100,000 has the potential of adding $1\u2013$10 million to a company\u2019s revenue every year that person remains with the company.[footnote]\"Modern HR in the Cloud: Best Practices for Recruiting the Best Talent<\/a>.\" Oracle. Accessed July 26, 2019.[\/footnote] The cost and organizational impact of a poor choice is also significant. The U.S. Department of Labor estimates that the average cost of a bad hiring decision is 30% of the employee\u2019s first year projected earnings.[footnote]Cardenas, Rebekah. \"What's the Real Cost of a Bad Hire?<\/a>\" HR Exchange. April 2, 2014. Accessed July 26, 2019.[\/footnote] Note, however, that number represents only a fraction of the organizational impact. CFOs surveyed by global staffing firm Robert Half ranked morale (39%) and productivity (34%) effects of a bad hire greater than the monetary (25%) cost. Additionally, a perception that leaders lack competence undermines trust in the organization\u2014a point we\u2019ll discuss further in the Module 15: Corporate Social Responsibility<\/a>. Perhaps the most damaging effect is on an organization\u2019s top performers; worst case scenario: the pressure and dysfunction could cause them to leave, ending the revenue multiplier effect.\r\n\r\n\"illustration\u201cGetting the right people on the bus\u201d is also critical because personnel costs are often a business\u2019 single largest expense. According to the Society for Human Resource Management, salaries alone can account for 18 to 52 percent of your operating budget.[footnote]Deeb, Carol. \"Percent of a Business Budget for Salary<\/a>.\" Chron. Accesed July 26, 2019.[\/footnote] Add in taxes and benefits and the full cost could be in the 40\u201380% of gross revenue range.[footnote]Ferguson, Grace. \"What Percentage of the Budget Should Be Spent on Payroll?<\/a>\" Chron. Accessed July, 26, 2019.[\/footnote] Choose well, and your employees can be a source of revenue and competitive advantage. A poor choice can represent a critical liability.\r\n\r\nMaking the best talent choices also requires organizations to address HR information processing challenges and confront the reality of perceptual errors and unconscious bias. As the UNC Executive Development Team phrases it: \u201cUnconscious biases in the workplace can stymie diversity, recruiting and retention efforts, and unknowingly shape an organization\u2019s culture.\u201d[footnote]\"The Real Effect of Unconscious Bias in the Workplace<\/a>.\" UNC Executive Development Blog. October 8, 2015. Accessed July 26, 2019.[\/footnote] Increasingly, choosing well\u2014and optimizing the recruiting process from cost, effectiveness and candidate experience standpoints\u2014will involve integrating automation, robotics and AI.\r\n\r\nFor perspective, Swedish recruiters are currently testing the world\u2019s first robot designed to conduct unbiased job interviews.[footnote]Savage, Maddy. \"Meet Tengai, a Job Interview Robot Who Won't Judge You<\/a>.\" BBC. March 12, 2019. Accessed July 26, 2019.[\/footnote] Developed by AI and social robotics firm Furhat Robotics, \u201cTengai\u201d is a 16\u201d tall computer interface similar to a human head that would be positioned on a table across from a candidate.\r\n\r\n