Human resource strategies can prove very effective and efficient into adding value to the company; nonetheless, the extent to which value is added depends highly on whether the strategies are horizontally and vertically integrated with the business’ strategy. ‘Nowhere is this more important than with an organisation’s recruitment, selection and retention functions’ (Compton et al, 2009, p9).
A very important theory that builds on this approach is the Human Capital Theory, which, according to Kearns (2005) as cited by Armstrong (2006), regards employees as ‘value adders, not overheads’ (p30). Line managers need to take in account the candidate and their experience in carrying out the recruitment and selection process, in order to carry it out in an efficient and effective way. The Need for and Importance of Strategic Recruitment and Selection
Starbucks Recruitment And Selection Process
‘Is there a vacancy? Is it to be filled by a newly recruited employee? These are the first questions to be answered in recruitment’ (Torrington et al, 2008, p147). Whether the vacancy is due to an employee leaving or ‘as a result of expansion’ (ibid), the HR manager can look at different options to fill in the gap rather than opt for recruitment, advising the line managers to either reorganize the workload or subcontract the work, as suggested by Torrington et al (ibid).
Strategic recruitment and selection practice ‘is driven by its alignment with organizational strategies rather than the immediate need of specific job vacancies’ (Millmore et al, 2007, p279). When the HR manager finds appropriate the need of a new candidate suitable for the vacancy, policies need to be devised in order to recruit internally or externally, depending on the job description and capabilities expected from the new candidate and if these competences can be found inside the company or externally.
Appendix 1b builds on these questions through scenario planning and developing human resource plans in order to act effectively on labour turnover and new methods of recruitment and selection. ‘Whichever model of the labour market is chosen, it is important to bear that market in mind when deciding on the approach to it’ (Roberts, 1997, p25).
Approaching the internal market will be different that the external market of labour and thus HR managers will need to devise policies that are suitable for advertising the new vacancy in the labour market chosen, carefully following the key principles of Employment Law from the early stages of recruitment; therefore line managers need to show a duty of care, be reasonable, and make decisions based on natural justice, avoiding discrimination in advertising for the vacancy and in the selection process.
The main recruitment and selection theory is that it adds competitive advantage to the company through models of recruitment of selection (Appendix 1). ‘The overall aim of the recruitment and selection process should be to obtain at minimum cost the number and quality of employees required to satisfy the human resource needs of the company'(Armstrong, 2006, p409). Recruitment and selection can prove to be very costly and time consuming activities, but if carried out effectively and efficiently these processes can bring a high competitive advantage to the company in the industry.
However costly, the benefits of effective and efficient recruitment and selection, along with appropriate policies and procedures for retention, could outweigh the costs as well as reduce the costs of high labour turnover. Recruitment and Selection in Context The recruitment and selection decisions are affected by different factors internally, such as ‘the organisation’s corporate planning’, ‘human resources’, ‘labour market conditions’ and ‘economic conditions in general’ (Compton et al, 2009, p18).
In order to conduct effective and efficient recruitment and selection processes, they need to be integrated within the overall business strategy. The organization type and the strategies within its life cycle are important factors in determining the need for recruitment and selection and devising strategies to employment in accordance to the business’ needs and demands. Appendix 1a shows the dependence of demand and supply of labour and price, depending on the external context of the business.
Labour demand forecasting is a vital feature of recruitment and selection, as human resource planning can ‘provide organizational planners with details of the desired demand for human resources in the business planning period’ (Compton et al, 2009, p9) as well as competencies required. Additionally, the context the business finds itself in at a specific point in time can influence the recruitment and selection functions. A PEST analysis of the industry, along with a SWOT analysis of the company can elucidate the factors affecting the business and its strategies at all levels, including recruitment and selection.
Appendix 2 focuses on context, analyzing the coffee shop industry through a PEST analysis (Appendix 2a), and Starbucks through a SWOT analysis (Appendix 2b). The subjective weighting of these analysis tools are positive, showing an attractive industry to the consumers, with strengths of Starbucks outweighing the threats imposed from competitors in the market. Starbucks can benefit from its brand image in recruitment and selection strategies. Additionally, in order to maintain the image, the future employees need to have the competencies required to work towards the company’s ethical strategy.
Williams (2000), cited by Haywood (2009, p209) argues that the right environment in a company is a main factor affecting recruitment and selection, and, more importantly, retention. He considers that ‘creating a winning environment consists of developing a high-achieving company with values and brand images of which employees can be proud’ (ibid). The SWOT analysis of Starbucks shows the company has managed to achieve this winning environment and thus should be very successful in retaining staff.