App-Strategic Staffing At ChernS A Case Study

Instructor’s Manual Strategic Staffing Appendix: Strategic Staffing at Chern’s: A Case Study There are several important changes to note in the second edition of the Chern’s case. Based on instructor and student feedback, we have made the following modifications: 1. All assessments focus on specific KSAOs rather than bundles of them. In the first edition of the case, some of the assessments combined multiple measures. These have been modified or eliminated. Additionally, more detail about the assessments is provided. 2. The assessment scores and performance outcomes for the candidates are different. This also results in a different rank order for computations of ROI. The change in scores and performance outcomes is because we modified the assessments. It also deters simple sharing and copying of previous cases to identify the best candidates. 3. The search syntax for the recruiting section has been updated. If students struggle with the syntax provided, we suggest changing the assignment to a search for a manager rather than a sales associate. Finding a sales associate is more challenging than finding a manager. 4. The streaming of the interview videos (structured and unstructured) has been improved so they should be easier to access and use. We have included some discussion points for both structured and unstructured interviews. 5. Spreadsheets with assessment scores and outcomes and also for computation of standardized scores are available for instructors only. Please do not distribute instructor spreadsheets because they include computations and answers that students should not be able to access. 6. CHAPTER 1: STRATEGIC STAFFING In this chapter, you learned that the strategic staffing process is guided by hiring goals that are clearly linked to an organization’s strategies and objectives. The goal of strategic staffing is to enable the organization to better execute its business strategy. There are two types of staffing goals: process goals and outcome goals. Process goals relate to the hiring process itself, and outcome goals apply to the product of the hiring effort. Table 1-2 gives examples of both types of staffing goals, and Table 1-3 gives you some questions to consider in setting appropriate staffing goals. Your consulting assignment for Chapter 1 is to identify realistic long-term and short-term process and outcome goals for staffing of sales associate positions at Chern’s. Be sure to relate your goals to the firm’s business strategy and explain why each is important and should be adopted by the company. Sample answer: Short-Term Process Goal Importance Attracting sufficient numbers of qualified candidates Attracting sufficient numbers of applicants who share Chern’s values and who possess sales and customer service skills, and a drive to be successful, establishes the foundation of Chern’s staffing and business success. Meeting hiring timeline goals (e.g., interviews, job offers) Meeting hiring timeline goals fills positions as quickly as possible and influences how job candidates view the company. Meeting timeline goals also reinforces Chern’s goal to make every employee and customer feel valued and cared for. Chern’s will look prepared, organized, and respectful of candidates’ time. This can reduce negative spillover effects among those candidates who do not receive a job offer but who may be current, or potential future customers. Short-Term Outcome Goal Hiring individuals who succeed in their jobs Hired sales associates must succeed in their jobs in order for Chern’s to execute its business strategy and for staffing to be considered effective. Hiring sales associates who provide the first-class customer service that has helped Chern’s differentiate itself from its competitors is critical for the execution of Chern’s’ strategy. Unsuccessful sales associates may also cost Chern’s the opportunity to gain long-term customers if their initial experience with an ineffective sales associate turns them off to shopping at Chern’s. Lowering training costs Hiring qualified candidates allows Chern’s to focus more on training employees on its business strategy and goals, instead of on basic skills and knowledge. In the end, this saves time and money, and decreases employees’ time-to-productivity. Long-Term Process Goal Complying with the law and any organizational policies, as well as fulfilling any affirmative action obligations Legal compliance in all areas of recruiting and assessment, and fulfilling any affirmative action obligations, is an important process goal for any organization. In addition to reducing legal risks, legal compliance can enhance hiring quality and promote employee diversity, which are positive and lasting long-term outcomes. Attracting a diverse pool of qualified candidates In addition to legal compliance, diversity gives Chern’s a competitive advantage in the retail sector. Diverse employees may be able to better relate to, and understand different types of customers, which will enable Chern’s to provide even more effective customer service. Long-Term Outcome Goals Hiring sales associates who will stay with the organization and eventually be promoted This will help Chern’s fill its managerial positions in the long-term, and lower its staffing and training costs. In addition, Chern’s highest performing sales associates tend to be those who have been with the store for more than 18 months. The longer employees stay, the more likely they are to truly understand the business strategy, and be able to execute it. Enhancing business strategy execution A core goal of Chern’s’ staffing strategy should be to enhance the firm’s business strategy execution. This requires matching the competencies, values, and traits of job candidates with what Chern’s requires for the positions, and for the organization, while maintaining legal compliance. CHAPTER 2: BUSINESS AND STAFFING STRATEGIES In this chapter, you learned about how a firm’s business strategy and talent philosophy shape its HR strategy, which then influences the firm’s staffing strategy. After Ryan and Ann learned about this process, they felt that the company needed to develop a more formal talent philosophy of its own to shape its HR and staffing strategy. They have asked you for your recommendations. Chapter 2 and Tables 2-4 and 2-5 should help you identify key components of an appropriate talent philosophy, human resource strategy, and staffing philosophy for Chern’s. Be sure to consider the company’s business strategy and competitive advantage, life stage, and the company’s values and culture when making your recommendations. You should also clarify how putting the right talent in the company’s sales associate positions can create a competitive advantage for Chern’s. In addition to developing a formal talent philosophy, HR strategy, and specific staffing strategy, you also need to explain how Chern’s should address each of the nine strategic staffing decisions listed in Table 2-6 for the sales associate position, and justify your reasoning. For example, the first decision is whether Chern’s should establish a core or flexible sales associate workforce. Describe in your report if Chern’s should focus on a core or flexible workforce and to what degree. Be sure to explain why they should follow your recommendations. Do this for the other eight strategic staffing decisions as well, taking into account the chapter material as well as the information provided about Chern’s in the beginning of the appendix. Sample answer: To maintain and enhance Chern’s’ competitive advantage, Chern’s should refine and formalize the current talent philosophy, HR strategy, and staffing strategy for the sales associate position. Below are recommendations for each: Talent Philosophy Based upon the culture of Chern’s, and the necessity of exceptional sales associates, Chern’s should formalize a talent philosophy. This philosophy should view employees as partners who are respected and treated fairly in terms of wages, hours, and working conditions. Chern’s’ talent philosophy should reflect the fact that its employees are its greatest asset and that they should be valued, grown, and developed in order to execute Chern’s’ business strategy and drive performance. HR Strategy Consistent with the talent strategy of Chern’s, the human resource strategy should help to acquire talented “partners” and make them feel that they are highly respected and valued through company practices and policies. Human resources can help by developing new hires into successful sales associates, and helping to retain and promote them by providing excellent benefits and incentives, and great working conditions. In creating a talent philosophy of viewing employees as partners, Chern’s human resource strategy could include an open door policy where their employees can feel free to express any concern they may have, and where they are treated with respect and fairness. The environment should promote teamwork, diversity, and the inclusion of everyone. Chern’s should treat its employees as stakeholders, making the relationship mutually beneficial. Good benefits and training programs can encourage employees to work hard, and experience a good return on their investments in the company. With a philosophy of open communication with both employees and applicants whenever possible, Chern’s will be as fair and honest as possible in terms of hiring and employment decisions. Keeping employees satisfied and informed, and giving them regular performance feedback helps to motivate them to do their best for Chern’s. Staffing Strategy The staffing strategy of Chern’s should reflect the business, talent, and human resource strategies. Hiring and attracting the best candidates who match the values of the organization, and who can grow and develop into efficient sales associates is essential. By recruiting and retaining exceptional people through Chern’s’ positive employer reputation and brand recognition, excellent benefits and pay, and working conditions, these new hires can easily become exceptional sales associates. Succession planning and career development should be incorporated into the staffing strategy to help retain employees and decrease unwanted turnover. In developing a formal staffing strategy, finding and hiring the right people to put in the sales associate positions will create a competitive advantage for Chern’s’ and reinforce its customer service competitive advantage. The sales associates Chern’s employs can make or break the business. Putting the wrong people in these positions will create service that will not differentiate Chern’s from their competitors, and not allow them to charge premium prices. Nine Strategic Staffing Decisions Core or flexible workforce? For the sales associate position, a core workforce is required to develop long-term customer relationships. Chern’s specifically states that they are not interested in temporary labor because they feel they would not reinforce its culture. This policy should be continued. The only exception might be around the holidays when additional sales help is needed to handle the increased customer traffic. Temporary employees might be restricted to working the cash registers to free sales associates to provide top quality customer service. Hire internally or externally? Chern’s will have to depend upon the external market for candidates because the sales associate role is an entry-level job, and the company does not have a pool of internal feeder talent. Sales associates should then provide a feeder pool for other positions within the organization, such as Department Managers and Store Managers. Hire for or train and develop needed skills? Chern’s should be looking to hire for those skills that make their workforce a source of competitive advantage. Things that could not be easily trained would be proven success in high-end retail, emotional intelligence, and customer service skills. These candidates would have a good understanding of the value Chern’s places on customer service and customer intimacy. Beyond that, Chern’s will need to develop some leadership skills and expertise specific to their products. Replace or retain talent? Chern’s does a good job of creating a competitive employee value proposition that would most likely increase employee commitment and lower turnover among high-performing sales associates. Because its business strategy requires the cultivation of long-term customer relationships, retaining effective sales associates would generally be preferable to encouraging turnover. What levels of which skills do we need where? In an entry-level job, it’s difficult to expect that ideal candidates will possess high-level skills with minimal job experience. Ideally, Chern’s would be able to identify attributes that will contribute to job success and Chern’s’ business strategy execution. Sourcing professionals should look for candidates that possess customer-focused attitudes and traits, and then train for more job-specific skills. Will we staff proactively or reactively? Chern’s will be able to do a fair amount of its staffing proactively. The retail industry tends to be seasonal, therefore Chern’s can anticipate increased or decreased staffing needs and turnover trends. Given the high turnover level, Chern’s can proactively source and hire sales associates so they won’t need to wait for one person leave, and then need to be reactive in their hiring. Which jobs should we focus on? The sales associate role is crucial to Chern’s’ business. These employees have the only direct contact with customers and are able to influence their consumer experience. These consumer experiences directly impact sales and customer satisfaction. Therefore, these associates have a unique opportunity that no other Chern’s employees have. Increasing focus on this role would be appropriate given the impact these associates can have if they are trained appropriately and understand the business. Is staffing treated as an investment or a cost? Staffing should be treated as an investment since the sales associates can have such a tremendous financial impact on Chern’s’ bottom line. The effects of poor candidate placement can create multiple negative customer experiences from which Chern’s will have a difficult time recovering. In order to create customer loyalty, Chern’s must staff its sales associate positions with people who have superior customer service skills. In order to procure that level of skill, staffing needs to be treated as an investment because those skills are relatively rare and are critical to Chern’s strategic execution. Will staffing be centralized or decentralized? Chern’s should probably adopt either a decentralized, or a combined approach. Because the sales associate position requires the same job competencies regardless of geography, centralization can offer cost advantages. However, because each store is different in terms of needs and local culture, candidates will need to be assessed on meeting local needs as well. Because the labor market for sales associates is local, individual stores might also need to do their own sourcing under a more decentralized model. CHAPTER 3: THE LEGAL CONTEXT Although Ann and Ryan have always known that it is important to comply with equal employment opportunity legislation and other relevant employment laws, it has been eight years since they conducted any sort of discrimination analyses at their company. They ask you to evaluate the sales associate position for any evidence of discrimination based on gender or ethnicity. The first level of disparate impact analyses are typically done at the establishment level, which for Chern’s is a single store. Chern’s asks you to focus on its flagship store—it’s largest—which has 140 full-time and 50 part-time sales associates. Chern’s gives all department and store managers bias and diversity training, and has never been sued for disparate treatment. Because it knows that adverse impact is still a risk, the company asks you to analyze its full-time sales associate hiring data for evidence of adverse impact. Tables A-2 through A-4 summarize the data you will need to use in your analyses. The data for the sales associate flow statistics are based on the previous five years of staffing at Chern’s flagship store. Evaluate the stock and concentration statistics, and use the four-fifths rule to analyze the flow statistics. In addition to your disparate impact analyses, be sure to recommend strategies that Chern’s can use to alleviate any discrimination you find. Table A-2 Sales Associate Statistics Compared to the Relevant Population Job Category: Sales Associates Current Sales Associates (%) Availability of Sales Associates in Relevant Population (%) Females 55 60 Males 45 40 Whites 20 25 Blacks 20 25 Asians 32 25 Hispanics 28 25 Table A-3 Sales Associate Flow Statistics # Applicants # Hired Men 1,000 80 Women 1,400 160 Whites 600 55 Blacks 600 48 Asians 600 67 Hispanics 600 50 Table A-4 Sales Associate Concentration Statistics Sales Associates (%) Department Managers (%) Store Managers (%) Female 55 30 40 Male 45 70 60 White 20 20 24 Black 20 15 40 Asian 32 30 16 Hispanic 28 35 20 Sample answer: The stock statistics suggest an underutilization of women, Whites, and Blacks and overutilization of males, Asians, and Hispanics in the sales associate position. However, the percentage difference of the over-utilized and underutilized groups compared to the availability in the relevant population is small. The groups being underutilized fall short of their total availability in the relevant population by 5% or less. Although these statistics should be monitored in case the differences increase, there is little reason, based on these statistics, to believe that disparate impact is occurring. Focusing on the flow statistics, it appears that there is potential evidence of adverse impact against Men in terms of sex and against Blacks and Hispanics compared to Asians in terms of race. The hiring rate for women is 11.43%, 80% of which is 9.14%. As men are being hired at a rate of 8%, there is evidence of adverse impact as 8% is less than 9.14%. Currently 11.17% of Asian applicants are being hired. In using the 80% or 4/5 rule, a selection rate for any group that is less than 80% of the rate for the highest group will be regarded as evidence of adverse impact. Multiplying the 11.17% by 80% equals 8.94%. The only two racial groups with a selection rate of less than 8.94% are Blacks and Hispanics. As 8% of Blacks and 8.3% of Hispanics are being hired for the sales associate position, disparate impact is occurring against them compared to Asians per the 4/5 rule. # Applicants # Hired Selection Rate (%) Men 1,000 80 8% Women 1,400 160 11.43% Whites 600 55 9.2% Blacks 600 48 8% Asians 600 67 11.17% Hispanics 600 50 8.3% Based on the Sales Associate Concentration Statistics, there is a pretty even spread of percentages in each group. However, going outside the role of the sales associate, the most noticeable trend in the table shows that males are concentrated highest in the roles of department and store managers as compared to the other groups, especially when compared to women. Women are more predominant in the sales associate role. It may be beneficial to Chern’s to look into why women are most concentrated in the sales associate positions, but less in managerial roles and if there is any disparate impact occurring in promotional opportunities for women within the company. Other noticeable trends include the high percentage of black store managers, and low percentages of Asian and Hispanic store managers. Chern’s can take steps to eliminate any potential for disparate impact within the organization. Chern’s can continually monitor the data on their hires and number of applicants. If something in their data suggests an issue, Chern’s can try to identify any problems that may be occurring in the recruitment and selection process of the candidate for that particular position, and go from there. Chern’s can also educate and train their hiring managers about the barriers to legitimate staffing such as the like-me bias, stereotypes, and prejudice, as well as the numerous employment laws. This awareness will help to eliminate hiring decisions based on illegitimate reasons. Overall, there appears to be some evidence of employment discrimination at Chern’s. Management should identify why Asians are being hired at a disproportionate rate, and why male and Black employees are more likely to be store managers. Chern’s should provide bias and diversity training to all department and store managers, and possibly extend that to sales associates in the initial orientation program. Also, Chern’s should begin recruiting for diversity by advertising positions widely, attending career fairs, attending any association meetings for targeted genders or ethnicities, and recruiting students from diverse colleges. It is also wise to follow some guidelines provided by the Equal Employment Opportunity Commission (EEOC) for best practices in staffing. The EEOC says a best practice in staffing: • Complies with the law • Promotes equal employment opportunity • Addresses one or more barriers that adversely affect equal employment opportunity • Manifests management commitment and accountability • Ensures management and employee communication • Produces noteworthy results • Does not cause or result in unfairness CHAPTER 4: STRATEGIC JOB ANALYSIS AND COMPETENCY MODELING Referring to the information presented in the chapter and case, by researching the “retail salesperson” position on O*Net (http://online.onetcenter.org), and by interviewing a sales associate in a similar company if possible (for example, an associate at Saks Fifth Avenue, Neiman Marcus, Nordstrom, and so forth), create a job requirements matrix for the sales associate position at Chern’s. Be sure to consider the company’s business strategy and corporate culture in creating job duties and identifying competencies, or KSAOs. For each competency or KSAO, decide if Chern’s should hire people who already possess the characteristic, or if the firm should train them to develop it. Also, estimate to the best of your ability how important each characteristic is relative to the others, as well as the relative time associates spend on each job duty. You may have to use some judgment to come up with the answers to these questions. You will use this information later to determine how to weight the assessment information obtained on each job candidate. Given the information contained in the Chern’s case description and your own knowledge of this type of position, create a job rewards matrix for the sales associate position. If possible, interview a sales associate in a similar company can provide additional job rewards information. Sample answer: Job Requirements Matrix The contents of the job requirements matrix can differ somewhat from this example but should include customer service, merchandising, and cashiering in some way. Characteristics of Job Characteristics of Worker Job Duty Tasks Relative Importance of Job Duty Relative Time Spent Competency or KSAO Importance of KSAO or Competency to Task Performance (1=Low, 10=High, E=Essential) Customer Service -Greet customers and ascertain what each customer wants or needs -Recommend, select and help locate or obtain merchandise based on customer needs or desires -Answer questions regarding the store and its merchandise -Describe merchandise and explain its use, operation and care to customers -Prepare sales slips or sales contracts -Place special orders or call other stores to find desired items -Exchange merchandise for customers and accept returns -Bag or package purchases and wrap gifts 65% 70% -Listening skills -Speaking & oral communication skills -Customer service orientation -Negotiation -Customer service -Sales & marketing -Ability to work with diverse people -Communication skills -Cognitive ability 8.9 9.9 E 6.0 3.5 7.0 7.5 5.3 8.0 7.5 Money Management -Open and close cash registers, performing tasks such as counting money, separating charge slips, coupons and vouchers, balancing cash drawers, and making deposits -Compute sales prices, total purchases and receive/process cash or credit payment -Maintain records related to sales 25% 20% -Basic mathematics -Knowledge of computer technology -Cognitive ability 9.0 E 7.0 5.0 Merchandizing and Store Maintenance -Watch for and recognize security risks and thefts, and know how to prevent or handle these situations -Ticket, arrange and display merchandise to promote sales -Clean shelves, counters and tables 10% 10% -Social perceptiveness -Judgment and decision-making -Time management -Cognitive ability 5.8 6.2 5.4 5.0 Candidates hired for the sales associate position should already possess the following competencies or KSAOs: listening skills, speaking skills, customer service orientation, time management, mathematics, cognitive ability, and social perceptiveness. Chern’s could provide on-the-job training for the following competencies or KSAOs: service orientation, negotiation, sales and marketing, ability to work with diverse people, communication skills, knowledge of computer technology, judgment and decision making, and time management. All KSAOs needed for customer service are of high importance for the sales associate role. It is preferable that Chern’s hires for these skills, because they are not easily trained. However, it is possible these skills could be better evaluated and trained through role-playing scenarios in which employees are given realistic situations that they must solve. Feedback can help employees learn where their weaknesses are, and how they can address situations better. This can be very time-consuming training for those who don’t naturally possess the skills for customer service. Knowledge of product lines can be easily trained, and new employees may or may not have worked with the same products before, so it probably is not necessary for Chern’s to hire for knowledge on their products. Chern’s should hire employees who they believe will be successful in training and become effective employees. Chern’s should hire employees who they believe will apply their knowledge to the job, and will retain what they learn for as long as it applies to their work, in addition to being fast learners. Job Rewards Matrix REWARD AMOUNT DIFFERENTIAL STABILITY TO WHOM THIS REWARD MIGHT APPEAL Base Pay 20% above market All sales associates Overall stable, but depends on market changes and firm performance Almost all sales associates Increases none Stable - based on changes in cost of living. Most employees Benefits 2 Weeks paid vacation None – All employees receive same benefits Stable Most employees 10 personal days Health/dental package Up to 10% match for 401K $1,000 referral bonus Performance based pay 20% customer service Vary based on performance Based on individual performance Individuals who value making and being rewarded for individual contributions. Will not appeal too much for risk averse employees. 40% individual performance relative to sales goal Vary based on performance Based on individual performance Individuals who are effective salespeople 40% overall store sales Vary based on performance Based on team performance and store performance. Individuals who value team work and are able to work fairly well with others. Promotion opportunity To various positions Vary based on performance, skills and abilities. Opportunity will be equal for all employees. Based on individual performance and position availability Individuals who desire to move up the career ladder or who are looking for management positions. Intrinsic rewards Ability to make decisions Consistent for all sales associates Fairly stable Individuals who like autonomy and can make decisions and judgments and can work with less or no direction. Ability to help customers Consistent for all sales associates Fairly stable Individuals who like helping others and find job satisfaction in doing so. Ability to interact socially Consistent for all sales associates Fairly stable Individuals who are social and like social interactions Company culture Consistent for all sales associates Fairly stable Individuals who enjoy supportive environments CHAPTER 5: FORECASTING AND PLANNING Chern’s has never examined its internal labor market. The company asks you to perform a transition analysis for full-time sales associates. It asks you to conduct relevant analyses to describe the internal labor market for its flagship store. Summarize the flagship store’s internal labor market and highlight any trends or forecasted gaps based on the transition probability matrix in Table A-5. The probabilities are based on annual rates that are averaged over a span of three years. In other words, they are the average rate per year. If Chern’s wants to keep its flagship store staffed with 140 full-time sales associates, how many full-time sales associates should it expect to have to hire from outside the company annually? Traditionally, 30 percent of the store’s job applicants for sales associate positions become job candidates, and 15 percent of them receive job offers, 75 percent of which are accepted. Chern’s asks you how many applicants it will need to generate each year to acquire the number of new hires you forecasted. Table A-5 The Transition Probability Matrix for Chern’s Flagship Store Transition Probabilities Based on the Past 3 Years Job Category FTSA (%) PTSA (%) DEP (%) BUY (%) MER (%) Exit (%) Current # of Employees Full-Time Sales Associates (FTSA) 50 15 5 5 5 20 140 Part-Time Sales Associates (PTSA) 30 50 0 5 0 15 30 Department Manager (DEP) 5 0 75 0 0 20 16 Buyers (BUY) 0 0 0 65 5 30 5 Merchandising Managers (MER) 0 0 0 0 80 20 8 Chern’s asks you to research the external labor market for sales associates because the company is concerned about their availability in the future. Using O*Net, choose a state in the United States and research the expected demand for sales associates in that state over the next 10 years. To do this: 1. Go to www.online.onetcenter.org. 2. Search for job 41-2031.00—Retail Salespersons. 3. Scroll to the bottom and find “Wages and Employment Trends”. 4. Select a state from the “State and National” drop-down menu and hit “go”. 5. Compare the forecasted employment trends in your chosen state with those of the entire United States for the retail salesperson position. 6. Print out the results of your state search and include it with your report. 7. There is also a “Career Video” available on the state results page of your search that you can view for additional information about the work sales associates do. Now research the employment trends of retail sales workers using the U.S. Department of Labor Bureau of Labor Statistics Web site at www.bls.gov and other resources you identify. Consider this information when forecasting future gaps or surpluses. You might also consider targeted skill sets or demographics, and determine if you can obtain information about skill or demographic trends in your targeted area. If you forecast a gap between the anticipated supply of qualified sales associates and Chern’s anticipated demand for them, determine whether the gap is temporary or permanent. Then, make some recommendations about how Chern’s can best address the gap. Be sure to reread the relevant section of Chapter 5 before you do. Sample answer: Transition Probabilities Job Category FTSA PTSA DEP BUY MER Exit Current # of Employees Full-time Sales Associates (FTSA) 70 21 7 7 7 28 140 Part-time Sales Associates (PTSA) 9 15 0 1.5=2 0 4.5=5 30 Department Manager (DEP) .8=1 0 12 0 0 3.2=4 16 Buyers (BUY) 0 0 0 3.25=4 .25=1 1.5=2 5 Merchandising Managers (MER) 0 0 0 0 6.4=7 1.6=2 8 Total 80 36 19 13 15 Note: All fractions have been rounded up to ensure sufficient numbers of employees are available to cover the position in question. Although this could cause overstaffing issues, because of Chern’s focus on customer service, staffing proactively and having a surplus of workers would be preferred to staffing reactively and being understaffed. If the surplus remains persistent and business necessity no longer can carry it, Chern’s can reassign or retrain their employees for other positions and institute hiring freezes to alleviate the situation if it becomes a problem. Based on the transition probability matrix, Chern’s experiences the greatest retention rates among department managers, buyers, and merchandising managers. There is little to no movement of department managers, buyers, and merchandising managers to any other position in the company (with the exception of a small percentage of buyers moving to merchandising managers, and department managers to full-time sales associates). For these positions, the employees tend to either stay in the job or leave the company altogether. In general, it appears that full-time sales associates are advancing the most relative to the other positions in the company. Based on the forecasted employee matrix, there will be a deficit of full-time sales associates, while there will be a surplus for all other positions. Assuming no growth in employee requirements, Chern’s should expect to hire an additional 60 full-time sales associates (approximately) annually to maintain 140 Full-time Sales Associates. It would need 1,778 applicants in order to acquire the number of new hires forecasted. 60 workers hired 80 workers offered (75% accept position)  533 interviewed (15% receive offer)  1778 applicants (30% become candidates)  The predicted trends and future demand for sales associates in the chosen state will differ. CHAPTER 6: SOURCING: IDENTIFYING RECRUITS Chern’s currently uses six different sources for sales associate applicants: colleges, employee referrals, Chern’s.com, a search firm, walk-ins, and local newspaper ads. The company just finished analyzing the effectiveness of each of these sources, and the results are summarized in Table A-6. Table A-6 The Effectiveness of the Sources Used to Recruit Chern’s Sales Associates Hiring Speed Cost per Hire Culture Fit Average First Year Financial Return First Year Turnover Rate College Hiring 5 months $4,000 Good $30,000 20% Employee Referrals 2 months $2,600 Very good $38,000 10% Chern’s.com 2 months $1,500 Good $38,000 20% Search Firm 3 months $5,200 Average $20,000 15% Walk-ins 1 month $1,500 Poor $5,000 30% Newspaper Ads 2 months $2,000 Poor $4,000 25% Chern’s asks you to prioritize its recruiting sources to maximize the effectiveness of the company’s future hiring initiatives. Based on what you have read in this case, prioritize the staffing outcomes and rank order the recruiting sources based on their ability to maximize the company’s staffing goals for the sales associate position. Ryan and Ann have heard a lot lately about using the Internet to source passive job candidates. The two are wondering how well this technique would work for its sales associate positions. Referring to the Develop Your Skills feature in Chapter 6, choose an area of the country. First, provide some suggestions on how the Internet might be more effectively used to source and recruit applicants. Second, conduct a Boolean search to source two promising sales associate applicants using the Internet. You may need to try different search engines and different syntax, as highlighted in the chapter. You can also try x-raying and flipping. For example, on Yahoo.com you could try “linkdomain:ffany.org shoes blog” to pull up blogs linked to the Fashion Footwear Association of New York with the word “shoes” in the blog. You should experiment with searches based on your own ideas. Include the various search engines and search terms you used for your final search and provide information about your two leads in an appendix to your final report. Justify each recommendation. To best serve its diverse clientele and to establish the most positive employer image possible, Chern’s wants to hire diverse sales associates. The company also asks you how it can improve the diversity of its applicant pool. Sample answer: Although answers might differ slightly, based on the results of Chern’s’ Sales Associate Recruiting Source Effectiveness Analysis, it is probably best for Chern’s to maximize its hiring from employee referrals, as they provide the highest returns and successful fit in many areas. The cost-per-hire is low, on average, compared to the other methods, and hiring speed is only two months. The culture fit is best when compared to all other recruiting sources, the average first year financial return is the highest, and turnover is lowest. A possible order in which staffing outcome goals could be prioritized is: 1. Hiring individuals who succeed in their jobs 2. Enhancing business strategy execution 3. Maximizing the financial return on the organization’s staffing investment 4. Hiring individuals who will stay with the organization for a reasonable period of time 5. Hiring individuals who will eventually be promoted 6. Enabling organizational flexibility Following is a ranked list of the order recruiting sources could be utilized based on their ability to maximize these prioritized sales associate staffing goals: 1. Employee Referrals 2. Chern’s.com 3. College Hiring 4. Search Firm 5. Walk-ins 6. Newspaper Ads Boolean search results for the two candidates will differ. Some recommendations to increase the diversity of the applicant pool for the sales associate position are: 1) Increase the depth and breadth of sourcing channels 2) Target schools with qualified minorities 3) Network and advertise jobs with professional associations targeted for minorities 4) Ensure that the company image promotes diversity. (For example, unlike Abercrombie and Fitch, which promoted the image that all-American consists of beautiful Caucasian people, Chern’s should create an employer image through advertising that promotes support for diversity, team culture, respect for diverse employees etc.) 5) Create reward packages that are attractive to applicants from different cultures, race, gender, age groups. For example, a day care facility might appeal to someone who has children versus someone who is fresh out of college and is most likely not going to have children. 6) Provide training classes that are appealing to diverse candidates. For example, language training for employees for whom their first language is not English. 7) CHAPTER 7: RECRUITING Develop an outline for a recruiting guide for the sales associate position based on the material you read in this case and what you learned in Chapter 7. The outline should include the company’s policies and procedures, budgets, activities, timelines, responsible staff, legal issues, and steps to be taken in recruiting for the position. You do not have time to write an entire recruiting guide. However, Chern’s has asked for your help in identifying what it should include in one. Chern’s also asks you to make recommendations about what the company can do to increase applicants’ fairness perceptions of the process and reduce any negative spillover effects related to it. Chern’s would also like to reinforce its employer brand among potential applicants. Ryan and Ann would like to create a stronger employer brand, and ask you for advice on what the company’s employer brand should be and how to effectively and consistently market and reinforce it throughout the staffing process. Make some recommendations and explain why your approach would be effective for Chern’s. Sample answer: Possible recruiting guide outline: 1. Company Strategy - The first step in strategic recruiting is to understand the company’s strategy. It is important that the recruiters, managers etc. are aware of and understand the company’s strategy, vision, mission and values. 2. Company’s Talent Philosophy – The guide should include Chern’s’ formal talent philosophy. In order to guide recruiters and managers to make any recruiting decisions, it is important to understand the company’s formal talent philosophy. The talent philosophy of considering employees as investors and not as assets, should be clearly stated. 3. Recruiting Strategy – The recruiting strategy section should include the following topics. a. Policies and Procedures The procedure and policies section should describe the entire process of recruiting and address the questions of what, who, when, and how. Some of the main topics that this section can cover are i. A step by step guide of the recruiting process from the authorization of a vacancy in the department through post offer processes. ii. Authorized sourcing channels This section should include the list of authorized sourcing channels a recruiter should use for the sales associate position. The section should also include the cost of the various channels, information on the number and quality of applicants each channel has produced in the past, the procedures of posting the jobs on each, etc. This section might also contain effective job descriptions that can be adapted for the current recruiting effort. iii. Candidate assessment and selection procedures This section should contain the details of the candidate assessment and selection procedures that are to be used in assessing candidates. For example, if Chern’s uses phone screening, structured interviews, job simulation etc., then the section should specify the details of each. The section should reiterate the steps from the step by step process guide, where each assessment will be made. Additionally, details of the scoring systems, various scales and their definitions should be provided. iv. Communication plan This section should include the overall staffing communication plan, and highlight the steps where communication plays an important role in the staffing process. The section should also provide any standard communications that hiring managers and recruiters are required to use, for example, letters to notify rejected candidates, letters to send candidates who will be invited to advance in the hiring process, job offer letters, etc. The section should help bring overall consistency across the messages that are sent and improve candidates’ perceptions of interactional fairness. v. Rewards policy This section should cover relevant compensation policies. Information such as employee referral policy and procedure, bonus structures, salary ranges, etc. should be included. The section should also state the policy on negotiable items in the total rewards package. Additionally, this section should include job rewards to guide recruiters in preparing and presenting offers and in persuading candidates to accept offers. b. Federal and State laws as applicable This section should focus on the various laws that are applicable for staffing and recruiting such as the Title VII, American Disabilities Act, etc. The section should also include information on EEO compliance and other federal agencies. c. Training information This section should consist of information on the various training programs that are available for the recruiters and hiring managers. For example, training information on the various assessment tools such as structured interviews, or the administration of job simulations can be provided. The section should address the what, where, and how for obtaining training. d. Information on technology and tools This section should provide information on the various tools that will be used during the recruiting process such as the applicant tracking software, the HRIS system, an so forth. Additionally, it should also provide detailed information on various tools required for assessment and selection procedures, such as interview guides, candidate evaluation forms, etc. e. Overall Budget information A summary of the various costs and benefits associated with the recruiting process, helping the user to budget appropriately. Improving Fairness Perceptions There are three types of fairness perceptions that influence applicant reactions to the recruitment and selection process. 1. Distributive fairness - relates to the perceived fairness of the hiring or promotion outcome 2. Procedural fairness - relates to people’s beliefs that the policies and procedures that produced the hiring or promotion decisions were fair 3. Interactional fairness - relates to people’s perceptions of the interpersonal treatment and the amount of information they received during the hiring process It is extremely important for applicants to feel that staffing outcomes, processes and interactions are respectful, fair, and honest. In order to increase the perception of procedural fairness, Chern’s should ensure that its recruiting and staffing procedures and policies enable hiring and/or promoting candidates who are qualified for the position. If candidates believe that the recruiting and staffing procedures were fair, even if the candidate is not hired or promoted, it reduces ill feelings towards the company. Following are some of the things that Chern’s can do to increase perceptions of procedural justice. 1) Create a recruiting guide to ensure consistency in the procedures and policies that are used during recruiting and selection. 2) Ensure that the assessment methods are job-related, valid, and reliable. For example, giving a knowledge test for a sales associate position with science questions can be perceived as not job-related. 3) Ensure that selection criteria with valid and reliable scoring systems are applied to all candidates. 4) Ensure hiring managers and recruiters are trained to apply the assessment methods in a consistent manner such as structured interviews, job simulations, and so on. Chern’s can have a lot of influence over applicants’ interactional justice perceptions. For example, even if the policies and procedures are perfect, if the candidates experience disrespect or rudeness during the process, they may leave with a negative perception of their experience. Following are some of the things that Chern’s can do to increase perceptions of interactional justice: 1) Ensure proper and timely communication with applicants. This communication plan should be highlighted in the recruiting guide, and followed by the recruiters and the hiring managers. As stated above, the plan will include the message that needs to be sent to the applicants who were not chosen for the position, or candidates who are being invited for the first round of interviews, etc. 2) All applicants and candidates should be treated with respect and dignity. The managers and recruiters should receive training on what are considered appropriate and acceptable behaviors. It is important that managers and recruiters don’t say the wrong things, or behave inappropriately. This is also extremely important from a legal standpoint. If required, training on interpersonal and communication skills should be provided to recruiters and hiring managers. 3) Ensure that administrative details are attended to, for example, reserving the meeting room, sending directions and parking information to candidates, etc. This is very important, because they can create a very negative impression if not done professionally. Employer Brand Creating a strong employer brand is important to attract applicants. An employer brand reflects internal and external perceptions of a firm as an employer. An employer brand answers the question, “Why should I work here?” and influences people’s intentions to apply for jobs. Chern’s employer brand should emphasize that they value and care for their employees and employees are important to company’s success. The brand should emphasize Chern’s core values and culture. For example, the brand should emphasize that management philosophy at Chern’s’ is that of empowerment and that the company believes in trusting its employees to use their judgment and gives them considerable freedom in doing their jobs. Chern’s employer brand should also include it’s image as an company that provides high-quality products and excellent customer service, and that it values it customers. Creating brand image through products is important because a company’s customers can become its future employees. The employer brand can be marketed through various channels. Following are some of the ways that are recommended for Chern’s to market its employer brand. Company Web site – Create a Web site with company information such as its mission, vision, values, etc. Provide links to explore company culture, people and environment, for example, by providing testimonials from current employees about why they like to work there, or information on the rewards packages, benefits etc. Current employees – Employee referrals is one of the important sourcing channels for the sales associates’ position. Ensure that current employees understand the company strategy, culture, talent philosophy, etc. Treat employees with respect and dignity. Give them tools such as information brochures, pamphlets, etc. to distribute to any potential referrals. Current employees should be able to identify with the employer brand and should feel good about working in the company. Staffing and recruiting processes –The employer brand can be marketed to applicants during the various stages of the recruiting process. The brand can be communicated to employees during the initial conversations with the recruiters, during candidate’s interview processes, communication letters that are sent out to applicants if they were not chosen, during offer process, and so forth. Community involvement - the employer brand can be advertised through community involvement. This is important for Chern’s because most of its sales force will be from local areas. Employees can identify better with companies that are visible in doing well for the local communities and charities. It shows that the company cares for others and is a responsible member of society. Employer Brand- an effective employer image and brand helps to provide competitive advantage and aid in targeted recruiting. In order to create stronger employer brand Chern’s should:  Further strengthen its consumer and organizational brand  Focus on influencing its symbolic meaning as an employer  Create an employer brand slogan  Avoid ethics violations  Deliver on its employer brand promises  Evaluate its employer brand in targeted applicant pools A strong and positive employer brand helps to attract applicants but for targeted recruiting it is essential that the employer brand be re-evaluated prior to a recruiting campaign and steps be taken to ensure that all promises are actually delivered. Recruiters should use the brand to the company’s benefit during interviews, and throughout the hiring process. A reasonable timeline may extend over a 6 month period with a focus on hiring the first candidates in about 2-3 months from the date of releasing job openings to Chern’s.com and employees for referrals. CHAPTER 8: MEASUREMENT, AND CHAPTER 9: ASSESSING EXTERNAL CANDIDATES Remember to write your report so that the various measurements you learned about in these chapters will be understandable to the firm’s store managers and department managers. These employees do not have a staffing or statistics background. Consequently, many of the concepts you discuss in the report will be unfamiliar to them. Be sure you thoroughly explain the concepts and their importance. This will be particularly important when completing the next part of the assignment, which spans Chapters 8 through 11. Chern’s is in the middle of hiring two sales associates for its flagship store and has reduced the initial applicant pool to eight candidates. Because it is the company’s flagship store, it is important that all sales associates who work at the store excel at customer service and embody the company’s values, and they need the new people to get up to speed quickly. Although Chern’s often invests in the training and development of new employees, in this case they would like the two new hires to arrive with the knowledge, skills, abilities, competencies, and other characteristics required to be immediately successful. They also would like the newly hired sales associates to be strong candidates for future management positions. Ryan and Ann ask you to become involved in the assessment and hiring process. Nearly eighty percent of Chern’s sales associates are considered successful. However, Chern’s would like the percentage to be at least 85 percent. Ryan and Ann feel that improving the company’s assessment and selection system will help it accomplish this goal. Use this opportunity to help Chern’s develop a new sales associate assessment and selection system. This is a pilot project to determine how well you are able to improve Chern’s staffing process. All eight candidates are already scheduled to participate in one structured and one unstructured interview that you are asked to view and score. After deducting the costs of the initial applicant screening and the two scheduled interviews for each candidate from the initial budget, the store has $4,000 left to apply to this staffing initiative. It’s up to you to decide how to spend the money. What other assessment methods should you use? (The costs of the two interviews are not to be included in your $4,000 budget.) The assignment for Chapter 8 is to read the case assignment spanning Chapters 8 through 11 and review the eight candidates’ résumés at the end of the appendix. You then need to develop an assessment plan that does not exceed your $4,000 budget. Your goals in developing your sales associate assessment system are threefold: 1. Maximize the return on investment of your assessment system 2. Maximize the job success of the new sales associates hired (in terms of their sales, turnover, and levels of customer service) 3. Maximize the fit of the new sales associates hired (including their customer service orientation and leadership skills) with the company’s culture Table A-7 summarizes the possible assessment methods you can use and their costs. Table A-7 Potential Assessment Methods and Their Costs ASSESSMENT METHOD SCALE OF ASSESSMENT COST Cognitive Ability Test (measures a candidate’s ability to learn, process, and apply information rapidly; verbal, spatial, and mathematical abilities) Typical scores range from 85 to 130 (mean and standard deviation for this sample are 112.5 and 8.02, respectively). $70 per candidate Conscientiousness (measures a candidate’s persistence, dutifulness, order, attention to detail, and achievement motivation) Possible scores range from 1 to 6 (mean = 4.38, std. dev. = 1.06). $100 per candidate Openness (measures a candidate’s openness to new ideas and situations and intellectual curiosity) Possible scores range from 0 to 60 (mean = 42.50, std. dev. = 7.07). $30 per candidate Sales Interest (measures a candidate’s interest in sales as a career; vocational interest inventory) Possible scores range from 1 to 5 (mean = 3.63, std. dev. = .92). $50 per candidate Desire to Avoid Failure (measures a candidate’s need to avoid failure and desire to avoid taking risk) Possible scores range from 1 to 4 (mean = 2.88, std. dev. = .83). $30 per candidate Technology Skills Test (measures a candidate’s ability to become proficient with the company’s various technology tools) Possible scores for this test range from 0 to 80 (mean = 58.13, std. dev. = 7.99). $70 per candidate Job Knowledge Test (measures a candidate’s knowledge of sales techniques, understanding of effective customer service practices, and awareness of related issues in the retail industry) Possible scores for this test range from 0 to 50 (mean = 36.88, std. dev. = 7.04). $150 per candidate Simulation (measures a candidate’s leadership, sales, judgment, and customer service skills using a work simulation) Possible scores for the simulation range from 0 to 70 (mean = 43.75, std. dev. = 10.61). $250 per candidate Integrity Test (measures a candidate’s trustworthiness, integrity, and honesty) Possible scores for this test range from 1 to 5 (mean = 3.50, std. dev. = 0.93). $70 per candidate Fashion Knowledge Test (measures a candidate’s knowledge of fashion trends, styles, and fabrics as they apply to a variety of customers) Possible scores for this test range from 0 to 60 (mean = 38.75, std. dev. = 8.76). $50 per candidate Handwriting Analysis (measures a candidate’s trustworthiness, personal drive, dependability, sociability, and desire to achieve) Possible scores for this analysis range from 0 to 10 (mean = 5.38, std. dev. = 3.38). $150 per candidate Next is an overview of the steps you will need to take in completing the next parts of the assignment and the chapter in which each part is assigned. The work will be spread out over the next few chapters. 1. Develop a sales associate assessment and selection plan that does not exceed the remaining $4,000 budget. Justify your proposed selection system using the determinants of the effectiveness of an assessment method identified in Chapter 8. These determinants include: a. Validity—how well the assessment method predicts relevant components of a person’s job performance. Table 9-3 describes typical validities for various assessment tools across many different occupations. You can look at Table 9-3 and consider the results of your job analysis/competency model to determine which assessment is most likely to predict job performance at Chern’s. b. Return on investment—the extent to which the assessment method generates a financial return that exceeds the cost associated with using it. c. Applicant reactions—the extent to which applicants perceive the assessment methods to be job related and fair. d. Selection ratio— the extent to which the selection ratio is low. A low ratio means hiring only a few applicants, which allows an assessment method to have maximal impact in terms of improving the performance of the people hired. e. Usability— the extent to which people in the organization are willing and able to use the method consistently and correctly. f. Adverse impact—the extent to which an assessment method predicts job performance and other important hiring outcomes without discriminating against members of a protected class. 2. Before viewing the interviews for the next part of the selection process, develop a scoring key for each structured interview question and create a formula to combine the three scores into an overall structured interview score (Chapter 8). The three structured interview questions are as follows: a. A disgruntled customer is returning a damaged suit jacket he bought the previous week that he needed for an event that night. He is extremely upset. What do you do? b. A person walks into your store and mentions that she has just moved into the area and that this is the first time she has visited your store. What would you do to make her a customer now and a loyal customer in the future? c. You’re working alone because two people called in sick. Suddenly, five customers walk into your department at once. What do you do? Additionally, create a scoring key for the unstructured interview based on your expected determinants of success at Chern’s. The scoring keys for both types of interviews should reflect the KSAOs or competencies assessed by the questions or interview, not the answers to the questions themselves. Then view the eight structured and eight unstructured interviews available on the book’s Web site or if your instructor prefers, view them as a part of the class. (Chapter 9) 3. Before or during your next class, submit your assessment plan to your instructor. Your instructor will then give you the candidates’ scores on the assessments you choose to utilize (Chapter 9). If your instructor agrees, you can use a multiple hurdles, compensatory, or combined approach for your assessment plan. 4. Using your interview score results, candidate résumés, and scores on the assessment methods you included in your assessment plan, determine which two candidates should receive an offer and submit this information along with the rationale for your choice to your instructor. Write a job offer letter to your top chosen candidate, who is currently considering two other job offers from competitors. (Chapter 11) At the end of the case, your instructor will give you feedback on the job success of your two new hires. For instructors, you can use the online Excel spreadsheet to copy and paste scores to send to students. The name of the spreadsheet is ChernsScoresInstructors. If you click on the tab labeled “Copied Sorted Scoring Key” you can easily copy, edit, paste, and send scores to students via e-mail. This can substantially ease the process of providing scores to students. For now you will work on step 1. Submit your assessment plan to the instructor by the deadline the instructor gives you to receive candidates’ scores on the assessments you choose to utilize. This request should be sent as your instructor prefers. One possible approach is to format it in the way shown in Table A-8. Use as many columns as necessary to provide a space for your instructor to record each candidate’s scores. Table A-8 Format for Requesting Candidates’ Assessment Scores Candidate Name of Assessment 1 Name of Assessment 2 Name of Assessment 3 Name of Assessment 4 Maria Cruz Sharon Simmons Alex Turing Parvathi Naryan Vera Levitt Chris Prender Julia McKnight Ben Hirsch Instructor Notes: We did not computerize this section to give instructors a tremendous amount of control over this part of the learning experience. Students will submit to you a request for scores for various assessments along with a rationale for the use of that assessment. Each assessment will have a cost associated with it, depending on which is selected. Students are to calculate the total cost of the assessments when requesting them, so that they remain within their $4,000 budget. The control you have involves both the scores you report, and the process students go through when requesting the assessments. First, although we provide a scoring key that is based on research findings, you can decide to edit or change the scoring key to suit your preferred weights for the predictors. Second, you can have students submit their requests as either a single stage selection process, or as a multiple hurdles model. The multiple hurdles model requires more work on the part of instructors because scores have to be provided two or more times rather than once, but it also demonstrates to the students how the money can go further with a two-stage assessment process. The scoring key is on the next page. Here is a brief description of the rationale behind the scores reported in the key. Obviously, with only 8 cases there are limitations in what we can do in terms of making the validities and inter-correlations among the predictors replicate known values in the literature. As a result, we focused primarily on predictor-criterion relationships and attempted to make them reflect the rank order of their relative predictive power. No single predictor is perfect, so it is helpful to use more than one measure when making a selection decision. Most of the predictors are correlated with the criterion, but some are more strongly related than others. Failure avoidance is weakly negatively related to job success, per previous research findings. The weakest predictor is handwriting analysis, which has a nearly 0 correlation with job success. The best predictors are significantly positive and similar in magnitude. These predictors include measures of cognitive ability, conscientiousness, sales interest, job knowledge, work simulation performance, and integrity. Technical skills and fashion knowledge are also significantly related to performance but less so than the variables listed above. Previous research has shown cognitive ability, work simulations, and job knowledge to be among the best predictors of job success so these are weighted significantly positively (see the table in Chapter 9). Personality characteristics such as sales interest and conscientiousness also have been found to be good predictors of performance in retail sales environments. Thus, these are also weighted significantly positively. In addition to the above predictors, we wrote the interviews such that the structured interviews, which students will have to watch and score later, are more highly positively correlated with job success than the unstructured interviews. Accordingly, structured interviews add to the prediction of job success more than unstructured interviews. As an instructor, you can alter the rank order of predictive utility by altering the numbers you report to students. If this is done, however, the changes in scoring should be carefully evaluated to ensure they effectively reflect the rank order of predictive usefulness reported in the literature. On the next page is our recommended scoring key. NAME CA CONS OPEN SALINT FAVD TST JKT SIM INT FKT HW Maria Cruz 125 5 40 5 2 60 45 60 5 50 3 Sharon Simmons 120 6 50 4 3 70 40 45 4 40 9 Alex Turing 115 5 45 4 4 55 45 50 4 40 10 Parvathi Naryan 110 5 35 3 2 65 35 55 3 40 6 Vera Levitt 100 4 50 4 3 60 40 35 3 50 10 Chris Prender 115 4 45 3 3 50 25 30 4 35 2 Julia McKnight 110 3 30 4 2 60 35 35 2 25 8 Ben Hirsch 105 3 45 2 4 45 30 40 3 30 7 CA = Cognitive Ability Test (ability to learn, process, and apply information quickly; verbal, spatial, and mathematical ability) CONS = Conscientiousness (persistence, dutifulness, order, attention to detail, and achievement motivation) OPEN = Openness (openness to new ideas and situations; curiosity) SALINT = Interest in Sales as a Career (vocational interest inventory) FAVD = Desire to Avoid Failure (avoidance of failure and desire to avoid risk) TST = Technology Skills Test (ability to learn and use technology oriented tools) JKT = Job Knowledge Test (knowledge of sales techniques, understanding effective customer service, etc.) SIM = Work Simulation (leadership, sales, judgment, customer service skills) INT = Integrity Test (integrity, trustworthiness, ethics, honesty) FKT = Fashion Knowledge Test (knowledge of fashion trends, style, fabrics, etc. as they apply to customers) HW = Handwriting Analysis (trustworthiness, drive, dependability, sociability, desire to achieve) Students should submit their request for assessment scores to the instructor, who fills in the table accordingly. Below is a sample request for assessment scores for a single-stage selection decision: I would like to obtain scores on cognitive ability, fashion knowledge, integrity, sales interest, and the work simulation. The total cost will be: (70+50+70+50+250)=490 * 8 candidates = $3,920. Thus, I will remain within my $4,000 budget. I assume based on previous research findings that cognitive ability, fashion-related knowledge, integrity, sales interest, and work simulation performance will be valid and useful predictors of sales success. Sales staff will perform better if they are able to process information quickly, know something about the fashion aspects of the job, are trustworthy and dependable, work hard, have an interest in sales work, and demonstrate actual customer service skills. If these are practically useful predictors then the money spent selecting the best candidate should yield a positive return on investment. Additionally, these methods should appear generally face valid so applicants should feel the assessment methods are job related and fair. It is possible that some applicants may have an issue with cognitive ability and integrity tests but such assessments are among the best predictors of job performance so I would use it as part of the assessment battery anyway. I would try to ameliorate negative reactions by standardizing the instructions and explaining why the tests are relevant for retail environments. This should enhance the procedural fairness of using the assessments. The selection ratio is 2 of 8, or .25. This selection ratio is low enough to expect that the predictors would be useful in identifying the best potential employees. The tests can be easily administered using standardized techniques, so most of the assessments should be highly usable. The work simulation is a bit more challenging in terms of usability, so I would probably outsource that effort. That is probably why it is more expensive than some of the other tools available. Some of the assessments, such as cognitive ability tests, may generate adverse impact. If true, I would use them as an initial screening tool and set the cut score at a lower level, or I would use them in combination with some of the other assessments known to have less adverse impact. Below is my form requesting scores on the cognitive ability, fashion knowledge, integrity, sales interest, and work simulation along with associated costs. Requested scores are marked with an “X”. Student Name __________________________ $70 $50 $70 $50 $250 Candidate Cognitive Ability Fashion Knowledge Integrity Sales Interest Work Simulation Maria Cruz X X X X X Sharon Simmons X X X X X Alex Turing X X X X X Parvathi Naryan X X X X X Vera Levitt X X X X X Chris Pender X X X X X Julia McKnight X X X X X Ben Hirsch X X X X X $560 $400 $560 $400 $2,000 Total $3,920 Instructors collect these forms from students, then use the scoring key provided to report the specific scores on the candidates of interest to the right of each “X.” Students should be instructed to not share their candidate assessment information with each other to prevent students from accessing candidate information that they did not “pay” for. Below is a sample request for assessment scores for a multiple hurdles selection process: As my first hurdle I would like to obtain scores on cognitive ability, fashion knowledge, and integrity. The cost of the first hurdle will be: (70+50+70)=190* 8 candidates = $1,520. I assume based on previous research findings that cognitive ability, job-related knowledge of fashion, and integrity measures will be valid and useful predictors of sales success. Sales staff will perform better if they are able to process information quickly, know something about the fashion aspects of the job, are trustworthy and dependable. I would set a low cut score for this part of the process to reduce possible adverse impact. The low cost, ease of administration, and high usability of these assessments make them ideal for using them as an initial hurdle so that more expensive assessments can be used at the next stage of decision making. Also, the low cost to screen out potentially poor fits should yield a positive return on investment in the staffing decision. I am trying to screen out 4 of the 8 in the first hurdle, so the selection ratio is .50. This is not particularly low, but it should be low enough to be beneficial in the decision-making process. Applicants should view the fashion knowledge test to be face valid, but they may have negative reactions to the cognitive ability and integrity tests. I would try to ameliorate such negative reactions by standardizing the instructions and explaining why the tests are relevant for retail environments. This should enhance the procedural fairness of using the assessments. I would use both cognitive ability and integrity tests because both have been shown to be strong predictors of job performance, and they are low in cost and easy to administer. In the next phase, I would ask for scores for the remaining four candidates on interest in sales, job knowledge, and work simulation performance. Sales staff will perform better if they know something about the job, have an interest in sales, and demonstrate actual customer service skills. If these are practically useful predictors, then the money spent on these additional assessments should yield a positive return on investment, particularly because only half the remaining candidates are being assessed. Additionally, the job knowledge test and work simulation should appear face valid, so applicants should feel the assessment methods are job related and fair. Applicants may have an issue with the personality test, so I would standardize instructions and make clear why the test is relevant to the retail environment. The selection ratio for this hurdle is 2 of 4 or .50. This selection ratio is low enough to expect that the predictors would be useful in identifying the best potential employees and yield the top candidates. The scores on the final hurdle would be combined with interviews to make the final decision. The personality and job knowledge tests can be easily administered using standardized techniques so most of the assessments should be highly usable. The work simulation is a bit more challenging in terms of usability, so I would probably outsource that effort. Work simulations are often more expensive than some of the other tools available because of the increased process management required. I don’t expect much adverse impact for these assessments but if it existed then I would use them in combination with some of the other assessments known to have less adverse impact. The cost of the 2nd phase is (50+150+250)*4=450*4 = $18,000. The total cost is $1,520+$1,800=$3,320, which is within the $4,000 budget. Below is my form requesting scores on the cognitive ability, fashion knowledge, integrity, sales interest, job knowledge test, and work simulation along with associated costs. Requested scores are marked with an “X”. Student Name _____________________________ Top 4 after first hurdles 70 50 70 100 150 250 Candidate Cognitive Ability Fashion Knowledge Integrity Personality Test C Job Knowledge Test Work Simulation Maria Cruz X X X Sharon Simmons X X X Alex Turing X X X Parvathi Naryan X X X Vera Levitt X X X Chris Prender X X X Julia McKnight X X X Ben Hirsch X X X 560 400 560 400 600 1000 Total 3520 The student would submit this form, then the instructor would provide the scores next to each “X” based on the scoring key provided. Next, the student would have to select the top 4 candidates, mark them with an X, and then return the form for the next set of scores. It can be seen that this is more labor intensive than the single stage model, but the student would benefit from the experience of seeing how much further the money can go with a multiple hurdle assessment. In this case, the multiple hurdles approach allowed an additional assessment to be conducted while staying within budget. Students must also submit a scoring key for observing interviews either in Chapter 8, 9, or 10. Sample scoring keys are provided below, but students’ keys should be more detailed across the range of possible scores for each question. Sample Scoring Key for Observing Interviews: The KSAOs and competencies identified as being important determinants of success in retail environments will be scored in the interviews. These include: Listening skills Communication skills Social perceptiveness Customer service orientation Structured Interview Question 1: A disgruntled customer is returning a damaged suit jacket he bought the previous week that he needed for an event that night. He is extremely upset. What do you do? Listening skills: 1 = doesn’t understand the question and doesn’t listen to customer in answer. 10 = understands and interprets the question properly and listens to customer in answer. Communication skills: 1 = stammers or is unclear when responding. 10 = clearly articulates and states response to situation. Social perceptiveness: 1 = awkward or uncomfortable in response to interviewer; unaware of customer’s needs in situation. 10 = responds and interacts with interviewer appropriately; is aware of customer’s needs in situation. Customer service orientation: 1 = does not understand or address the customer’s concern. 10 = clearly empathizes with customer and takes the steps required to address the customer’s concern. Question 2: A person walks into your store and mentions that she has just moved into the area and that this is the first time she has visited your store. What would you do to make her a customer now and a loyal customer in the future? Listening skills: 1 = doesn’t understand the question and doesn’t listen to customer in answer. 10 = understands and interprets the question properly and listens to customer in answer. Communication skills: 1 = stammers or is unclear when responding; fails to communicate with customer. 10 = clearly articulates and states response to situation; reaches out to communicate with customer. Social perceptiveness: 1 = awkward or uncomfortable in response to interviewer; unaware of customer’s needs in situation. 10 = responds and interacts with interviewer appropriately; is aware of customer’s needs in situation. Customer service orientation: 1 = does not understand or address the customer’s needs. 10 = clearly empathizes with customer needs and takes the steps to meet them. Question 3: You’re working alone because two people called in sick. Suddenly, five customers walk into your department at once. What do you do? Listening skills: 1 = doesn’t understand the question and doesn’t listen to customers answer. 10 = understands and interprets the question properly and listens to customers answer. Communication skills: 1 = stammers or is unclear when responding; fails to communicate with customers or other employees. 10 = clearly articulates and states response to situation; reaches out to communicate with customers or other employees. Social perceptiveness: 1 = awkward or uncomfortable in response to interviewer; unaware of customer’s needs and responses in situation. 10 = responds and interacts with interviewer appropriately; is aware of customer’s needs and responses in situation. Customer service orientation: 1 = does not understand or address the customer’s needs. 10 = clearly empathizes with customer’s needs and takes the steps to address them. Unstructured Interview Listening skills: 1 = doesn’t listen to and understand the interviewer. 10 = listens to and understands interviewer. Communication skills: 1 = stammers or is unclear when responding; unable to establish rapport. 10 = clearly articulates and states responses; establishes a good rapport. Social perceptiveness: 1 = awkward or uncomfortable in response to interviewer. 10 = responds and interacts with interviewer appropriately. Customer service orientation: 1 = does not understand customers. 10 = clearly understands customers. CHAPTER 10: ASSESSING INTERNAL CANDIDATES As explained earlier, 75 percent of the department managers and assistant department managers at Chern’s have been promoted from the company’s sales associate staff based on their supervisors’ recommendations and structured interviews. Unfortunately, Chern’s recently analyzed its turnover data and found that a disproportionate number of good sales associates who would have been potentially strong candidates for department manager and assistant department manager positions have left the organization. The exit interviews with these people revealed that the firm’s efforts to communicate its promotional opportunities and succession planning intentions to the high-potential sales associates have been insufficient. Many of the sales associates said that they were leaving because they had poor career planning visibility to the managerial positions they sought. The company currently does not tell its high-potential sales associates that they have been flagged for future promotion opportunities, believing that this would demoralize those not on the list. Because the company’s talent philosophy is to promote from within, it feels that it could improve its internal promotion practices. The company asks you to recommend ways that it can identify and develop sales associates who have the potential to become department managers. Note: the eight structured and eight unstructured interview videos are available on the Instructor’s Companion Web site and can be shown in class this week if desired. The set of 16 videos takes about an hour to view. A video access code is also bundled with new book purchases, and can be purchased separately by students purchasing used textbooks should students wish to view them outside of class or if instructors do not wish to use class time to show them. It may be worth noting during discussion about the interviews that unstructured interviews are more suitable for communicating information about Chern’s, and selling top candidates on the company, than are structured interviews. One positive aspect of showing the videos in class is that all students watch and score the videos at the same time, and this provides some opportunity for discussion. A tip is to show all 8 structured interviews first. At the end of the structured interviews, the class can discuss the challenges of asking the same question over and over, and the general challenges of using a structured interview process. You can point out that actual interviews take a half hour or more each, with more questions being asked, and that professional HR managers or recruiters might do as many as 10 to 12 interviews in a single day, for 5 to 7 days in a row. You can then show the next 8 unstructured interviews. These seem to flow more quickly. At the end of the unstructured interviews the class can discuss the challenges of comparing different responses to the more open format of the unstructured interviews. This is a nice opportunity to bring the concepts of structured and unstructured interviews to life, and to discuss the challenges and strengths of each approach. Students should have created a scoring key in advance of viewing the interviews. Please see the sample scoring key in the instructor manual for chapters 8 and 9. Sample answer on improving internal development and promotional practices: Seventy percent (75%) of Chern’s Department Managers were promoted from the company’s sales associate staff based on supervisor recommendations and structured interviews with Store Managers. However, a disproportionate number of good sales associates who were strong candidates for the manager position have left the organization. Many of these associates felt uncertain about future promotional opportunities, and about succession planning. These high potential associates had no idea that they had been flagged for promotion in the future. Following are some recommended ways to identify and develop sales associates who have the potential to become department managers. Skills Inventory In order to successfully develop sales associates it is important to identify the knowledge, skills, abilities, and other characteristics (KSAOs) of the current employees. Skills inventories allow a company to maintain a list of which employees have certain skills, competencies and other relevant characteristics. As employees gain new KSAOs, the database can be updated. Based on the job requirements matrix for various positions in the company, Chern’s’ can determine which competencies to track, based on what is required to be successful in the position Information collected through the skills inventory can help managers in succession and career development planning for the employees. It is important to communicate this information to all the sales associates and let them know that the information will be collected, how it will be used, and the privacy safeguards that are in place. Mentoring program A second recommendation for Chern’s is implementing a formal mentoring program. Mentoring is a dynamic, reciprocal relationship in a work environment between an advanced career incumbent and a beginner aimed at promoting the career development of both. Given Chern’s strategy, and its policies of internal promotion and bonus structure based on store performance which requires team work, mentoring can be effective and valuable for developing sales associates. Top sales associates or experienced managers can act as mentors for the new sales associates, as can employees who are likely to be promoted to managerial levels. Mentoring programs can become a good source of initial assessments and nominations of candidates, and a useful method of providing career enhancement for mentors and career progression for protégés. Mentoring will also be useful as a way to socialize new sales associates. It is recommended that a simple, but formal mentoring program be implemented. Succession Management The third recommendation is to improve and enhance succession management for the sales associate’s position. The following steps can be taken: 1. First, identify the knowledge, skills, abilities, and other characteristics that are needed for high performance in the sales associate position. 2. Next, identify individuals who are interested in promotional opportunities and are qualified. A skills inventory, performance reviews, interviews with managers, career development plans etc., can be used to identify these individuals. 3. The last step is to create a plan to continually and systematically improve the capabilities of all the identified sales associates. This step should be interrelated with career development planning for the employees. Tools such as the nine box matrix can be used for succession management. Unlike current practice, it is recommended that the company communicate the succession plans to the employees. All the sales associates should have an opportunity to understand and know which positions are open and the required skill sets for those positions. Giving equal opportunity will increase the fairness of the process. Fairness, and communication openness, are critical components of succession management. The process should be impartial, open, and backed by top management. Another important thing that Chern’s’ needs to do is ensure that there is proper manager involvement and commitment to the succession planning. It is recommended that incentives for managers are aligned in such a way that they are encouraged to identify high-potential candidates, and develop those candidates for future positions. Another way to increase commitment is to incorporate succession management in managers’ performance appraisals. Managers should also receive training in identifying and developing candidates, using the various tools, and constant support from top management. In order for succession management to be successful, it is necessary that once the candidates are identified, they are appropriately provided development opportunities through job experience, training, mentoring, etc. For employees who are not selected for the positions, alternate career paths should be planned, or different opportunities should be presented so that these employees do not feel demoralized, and/or leave the company. The succession management system should be continuously evaluated and improved based on the needs of the business environment, company strategy, and requirements of the position. Career development planning A fourth recommendation to develop sales associates is to integrate career planning with the organization’s succession management processes. Career planning is a continuous process of career-oriented self-assessment and goal setting. Career planning is important for the sales associates because of the policies and culture supporting internal promotion of employees to managerial positions. Many career developmental tools can be used to help employees develop the skills and abilities that are required for their career growth. For example, they can be given career counseling, challenging assignments, or various assignments through job rotations and mentoring. Career planning should be aligned with business strategy and future talent requirements. The growth strategy at Chern’s requires managerial talent to staff its various locations. Hence, employees who are likely to go into those positions should be identified and encouraged to gain and/or improve relevant skills, abilities and knowledge. A documented employee development plan can also increase the importance, commitment, and thoroughness of the plan. Performance appraisals Lastly, all of the above should be aligned with performance reviews. Performance reviews will help managers to assess their employees’ strengths, weaknesses, and performance over the year. As part of the review, feedback should be collected from internal (peers) and external customers. These recommendations will help Chern’s to improve its retention rates of high performing employees, and identify and develop sales associates who can potentially advance in the company. Communicating Promotional Opportunities Chern’s’ employees leaving because their ambitions aren’t being realized is a result of poor communication between managers and employees. Not telling high potential sales associates that they have been flagged for future promotion opportunities, (believing that this would demoralize those not on the list) has made ambitious high potentials feel their talents are not recognized. It is important for Chern’s’ employees to perceive the processes as fair, and this can be accomplished through openness of communication. Employees who are not on “the list” can learn what skills need to be developed, work towards making “the list,” might be content in their current role, or can be phased out of Chern’s. CHAPTER 11: CHOOSING AND HIRING CANDIDATES You will now continue your assessment and selection process for the two new hires. Develop a rational way of combining the scores on the assessment methods you recommended in your report for Chapter 9. How should Chern’s choose which candidates to hire? Do you recommend a multiple hurdles, compensatory, or combined approach? What weights should each assessment score receive when calculating each candidate’s overall score? Your job requirements matrix should help you make this judgment. Using your interview score results, candidate résumés, and scores on the assessment methods you included in your assessment plan, identify which two candidates should receive an offer and submit this information, along with the rationale for your choice, to your instructor. Also, explain what additional information you would like to have had before making a hiring decision. Ann and Ryan believe that in addition to the promotional opportunities Chern’s has to offer, the non-financial rewards of the job, including the extensive training and development new hires receive and the supportive work climate they experience, have not been sufficiently communicated to candidates. Not only does this explain why good sales associates are leaving the firm, it could explain why its sales associate job offer acceptance rates have been trending slightly downward. Write a job offer letter to your top chosen candidate, who is currently considering two other job offers. You would very much like to hire your top choice, but she or he has to decide on the other offers within one week. Be sure to use any relevant information from the job rewards analysis you conducted in Chapter 4 as well as the information contained in the initial case description. You can also use the information about Chern’s presented in the appendix. Your instructor will give you feedback on the outcomes for the two candidates you chose. Each candidate’s profile was evaluated by staffing experts and given a job success score of 1 to 10. The scores correspond with the individual financial returns to the company presented in Table A-9 (which were based on a combination of sales performance and a new hire’s fit with the company’s culture). Table A-9 The First Year Financial Value of Different Job-Success Levels Candidate’s Job Success Score First Year Financial Return to Chern’s 10 $50,000 9 $40,000 8 $30,000 7 $20,000 6 $10,000 5 0 4 ($10,000) 3 ($20,000) 2 ($30,000) 1 ($40,000) Calculate the ROI of your staffing investment in the new hires’ first year based on the financial return realized by your chosen hires and the cost of your assessment system. In addition to the assessment costs you incurred, assume that recruitment and the initial applicant screening cost the company $20,000, and the 16 interviews cost the company an additional $14,800. You can either calculate a net return or an ROI ratio. To compute the net return you will sum the financial return realized by your two hires and subtract the total cost of the selection system. To compute the ROI ratio, you will sum the financial return and divide it by the total cost of the selection system. Interpret either or both of these values. Instructor Notes: Below you will find the final scores for each candidate’s job success. These scores should be reported to students only after each person has submitted his or her two final candidates for selection. The students can then calculate the ROI based on the job success scores. See Chapter 5 for an example of a formula to calculate ROI. A sample calculation for someone who hired top performer Maria Cruz and mid-performer Parvathi Naryan is shown below. NAME Score Maria Cruz 10 Sharon Simmons 9 Alex Turing 8 Parvathi Naryan 6 Vera Levitt 4 Chris Prender 3 Julia McKnight 2 Ben Hirsch 1 Sample answer for ROI calculation: The estimated ROI of my staffing investment is determined by the first year financial returns realized by my chosen hires, and the cost of my assessment system. The company spent $3,920 on the assessments, $20,000 for recruitment and the initial applicant screening costs, and $14,800 for 16 interviews. The total cost is $38,720 to make two hires. Maria’s job success score was 10, which translates to $50,000 first year financial return to Chern’s. Parvathi’s job success score was 6, which translates to a $10,000 first-year financial return. The total return in the first year was $60,000. This return can be adjusted based on different assumptions (e.g., current selection system would have hired two employees with a $10,000 return for a net gain of $40,000). In this case, I will assume the average return is a score of 5 or $0, for a net gain of $60,000. The first year return pre-tax on the staffing investment is $60,000 so the return on investment (ROI) is $60,000 / $38,720 = 1.55 or 155%. This means that for every dollar invested in the staffing system, the organization will get $1.55 back. The return on investment is actually higher because this is just the first year return. Presumably the employees will remain with the organization and continue to improve in performance over the next years. The total return would be the sum of the financial gain over the tenure of the employees in question, adjusted for current rates of return and tenure. The ROI calculated in this manner is typically large because investments made in recruiting and selecting high quality employees, yields benefits year over year. Additionally, if two employees with a success score of 10 had been hired, then this would translate to a total of $100,000 in first year financial return. In this case the ROI is $100,000 / $38,720 = 2.58 or 258%! CHAPTER 12: MANAGING WORKFORCE FLOW Chern’s asks you to develop an onboarding and socialization strategy for its newly hired sales associates. Using Table 12-1 as a guide, write a report recommending appropriate onboarding and socialization strategies, and explain why you are making each recommendation. Chern’s recently completed a turnover analysis for sales associates at different performance levels and found that functional turnover begins at a performance level that currently covers the lowest-performing 15 percent of its sales associates. It also discovered that the top-performing 10 percent of its sales associates are responsible for 20 percent of the company’s sales. Unfortunately, the turnover rate of its top performers is almost twice the turnover rate of its low performers. Ann and Ryan ask you to develop a retention plan for the company’s top performers. Because they have developed good relationships with customers, sales associates who have been with the store more than 18 months tend to be the highest performers. Recall that in their exit interviews, many sales associates who resigned say they are leaving Chern’s because they believed they lacked promotional opportunities. Quite a few other top performers would have liked to continue working for Chern’s but could not adequately balance their school and family demands because their work hours as sales associates were fixed. The third most common reason top performers gave for leaving Chern’s was the lack of training and development opportunities. The company recently conducted an employee engagement survey, which reinforced the fact that employees found these three issues the most pressing. However, the company’s sales associates also reported being satisfied with their pay and benefits and very satisfied with the company culture and the support they receive from their department managers. Chern’s has been growing steadily, but its conservative financial goals also create a need to be prepared for unexpected changes in its environment. Chern’s believes that the economy is likely to stay strong, fueling its expansion strategy. However, the company wants to be prepared in the event that the economy cools and the demand for its products declines. Although Chern’s tries to protect its employees, it recognizes that in the event of an economic downturn, it will need to downsize its sales force to control costs. Chern’s asks you to recommend a downsizing strategy in the event that it needs to quickly reduce its number of sales associates by 15 percent. Sample answer: Onboarding and Socialization Strategy As there is little opportunity to recover the investment made in newly hired employees who quit the organization, it is important to focus on strategies that will help to increase employee engagement and reduce newcomer turnover. Besides the administrative processes associated with being hired, it is important that new hires understand the values, processes and traditions of the company and establish a productive relationship with the firm with the help of an onboarding and socialization plan. Chern’s should adopt the following onboarding and socialization strategies in order to reduce newcomer turnover: 1. Staggered approach – A brief orientation program similar to the one in place, followed by brief sessions over the next few weeks/months can help making the onboarding process more effective by preventing information overload. New hires also get a better understanding of the breadth of the company. 2. Collective socialization – When multiple sales associates are hired at the same time, this can be better than individual sessions, as all new hires go through a common set of experiences. Collective socialization increases newcomer embeddedness into Chern’s. 3. Formal and informal socialization – A blend of formal and informal socialization is advisable. While formal or structured socialization promotes proactive behavior like asking questions, building relationships, etc. and helps increase job satisfaction and commitment, unstructured informal socialization done on-the-job can be useful in creating a bonding with other co-workers. 4. Random and structured socialization – In random or ambiguous and changing socialization, sales associates will tend to learn things that they are interested in. Following a sequence of steps during the onboarding process ensures that new hires do not miss any valuable information. 5. Fixed socialization – Informing sales associates in advance of a planned end date for the end of their probationary period can enhance cohesiveness and possibly improve teamwork. 6. Contest socialization – Treating each socialization stage as a “contest” in which one builds up a track record, and failures are treated as learning experiences, encourages innovation and risk taking which is encouraged at Chern’s. 7. Serial socialization – Experienced, successful managers and other sales associates at Chern’s can be encouraged to become mentors and role models for new hires. This will help new hires understand the culture at Chern’s, and adapt some of the best practices used by the successful employees, thus continuing the Chern’s culture. 8. Investiture socialization – This reaffirms new hires’ self-confidence and reflects management’s belief in the skills and competencies of new hires. 9. What to include – Socialization and onboarding programs should help to communicate Chern’s’ policies, culture and strategy, and the role that new hires can play in achieving company objectives. 10. Whom to include - Socialization programs can be made more effective by including the supervising managers who will be accountable for the success of the new hires, and all others who will directly interact with the hired sales associates, like some of their peers and even higher management representatives. How to use technology – Automating a part of the socialization process and using Chern’s’ intranet will help to store information about new hires and use them in future for assessment purposes. Automated new hire packages containing information regarding access codes, training and development opportunities, can help make the process cheaper, and also ensure legal compliance. Most of the socialization process should be interpersonal, given Chern’s culture and the interpersonal nature of the sales associate position. Retention Strategy The first step towards creation of a retention strategy for sales associates, is analyzing the causes of their dissatisfaction and consequent turnover. Besides exit interviews, employee satisfaction surveys can be also used to analyze the causes of job dissatisfaction that can be addressed to hopefully prevent additional turnover. Chern’s should adopt the following retention strategies to reduce sales associate turnover: 1. Job Challenge – Sales associates at Chern’s could be trained to perform other challenging assignments that will help to keep them engaged during slow periods. Assignment changes will not only help associates develop in their jobs, but also help the management identify those who can take on further responsibilities and move on to a new role. 2. Better Supervisors – Development of supervisors can have a considerable impact on subordinates’ performance, retention and turnover by creating a climate of respect, trust and fairness. 3. Flexible work – As indicated in exit interviews, work-life balance is a primary source of dissatisfaction. Alternative job arrangements, job sharing and flextime are some possible forms of flexible work schedules. 4. Location – Location can be a crucial factor in increasing employee retention. During interviews, candidates should be made aware of the location of the store for which they are being hired. Also, for existing successful employees, depending on their personal preferences, transfers to different stores should be allowed. 5. Pay and benefits – At Chern’s, employees are usually satisfied with their pay and benefits, however, care should be taken to ensure that the staff understands the values of the benefits received, and the payment plan. 6. Create accountability – Managers play a very crucial role in enhancing employee engagement and performance by providing them with timely feedback, coaching, and help facilitating their development. Managers should be held accountable for the retention of their top performers, and be rewarded for their efforts in doing so. 7. Provide support – The management team at Chern’s can also impact employee engagement by providing the necessary resources and support essential to job success. They are also responsible for ensuring that the firm’s goals are well communicated down to all sales associates. 8. Create mobility barriers – Mobility barriers like stock options that vest in the future, extensive on-the-job training that is unique to Chern’s (e.g., technical training on the Perpetual Inventory System), and enhancing employees’ general fit with the culture, and rewards offered by Chern’s can help to increase retention. 9. Strong culture – A strong and attractive company culture can help to reduce turnover. Steps should be taken to further strengthen Chern’s’ culture, and its values of employee empowerment and customer service. 10. Managing succession – A strong succession management plan that integrates Chern’s talent management plan with the firm’s strategic plans has a deep impact on the employee spirit. Chern’s should ensure that its HR policies support the career development plans of its sales associates, and that they are motivated enough to accept higher level positions. A well-documented mobility policy helps to build credibility in the system. 11. Redeployment of talent – Sales associates at Chern’s enjoy a strong relationship with their customers. This expertise and knowledge can be used in other aspects of the business as well, for instance in the development of a marketing strategy. 15% Downsizing Strategy Chern’s has built an excellent reputation over the years for adhering to high standards in all areas of business. Chern’s also has a talent philosophy that views employees as partners who are respected and treated fairly in terms of wages, hours, and working conditions. The talent philosophy also reflects the fact that its employees are its greatest asset and that they should be valued, grown, and developed in order to execute Chern’s’ business strategy and drive performance. Therefore, Chern’s should view downsizing as a last resort, rather than a first option in order to save costs and any downsizing efforts should be consistent with the talent philosophy. In order to reduce its workforce by approximately fifteen percent (15%), Chern’s should first utilize the following options: Hiring Freeze: The company should attempt to save costs by putting a freeze on the hiring process, and cross-training certain employees to fill talent gaps rather than terminating employees in low productivity areas or departments. Voluntary Transfer: Chern’s may also offer employees the opportunity to transfer from locations where there is a labor surplus to locations where there is a talent gap. Reduce Pay and Bonuses: Chern’s can also limit pay raises and bonuses, and if necessary, reduce pay and/or reduce bonuses, in order to save costs so that it can delay terminating employees and save costs at the same time. Early Retirement and Buyouts: Offer incentives such as early retirement and buyouts to employees. Early retirement will allow employees to retire with either full, or reduced pension benefits at an earlier age. The buyouts will provide a lump sum payment to employees in exchange for their leaving the organization voluntarily (whether eligible for retirement or not). This means that Chern’s will not be terminating these employees, and will not suffer the degree of damage to its reputation that will likely follow a fifteen percent (15%) reduction in workforce via layoffs. Some employees would be happy to accept the early retirement, while others may happily accept the buyout where they have some financial security while they search for another job. Part-time Hours: Chern’s may ask full-time employees to volunteer to accept part-time hours to cut costs so that it can minimize layoffs. Chern’s can also request that part-time employees reduce their hours as well. Attrition: Once employees become aware that the company is in financial trouble, some may find other jobs and leave the company on their own. If the company has not been successful in downsizing using these means, involuntary separation may become necessary. Where involuntary downsizing is utilized, it is important for Chern’s to continue treating employees with respect and dignity. Treating employees otherwise could negatively affect the company’s reputation, and make it difficult to recruit high achieving employees when the economy improves. It could also cause the company to suffer greater financial losses if the public believes that it is not treating its employees well. In addition, it is important to avoid disparate impact in layoffs. Performance: Chern’s sales associates bring value to the company based on their job performance. As a result, employees who are poor performers should be the first to leave the company during a time of financial instability. Poor performers cost the company more money than do high performers. Therefore, it makes sense to let the poor performers go first. Layoffs by seniority could result in retention of poor performers who will continue to be a liability to the company. Specific Locations Targeted for Downsizing: It is also recommended that specific locations be targeted for downsizing. If individual stores are thriving, the workforce in those locations should be maintained. It is best to examine each store individually, and determine if there needs to be workforce reductions at each location. If workforce reductions are made across the board, a labor shortage may be unnecessarily created at one or more location. Across the board reductions by percentages are not recommended. There must be frequent communication between management and employees as to the exactly what is happening during the downsizing. There should be face-to-face communication with laid-off employees, giving employees the opportunity to respond/communicate with management. Senior management should be visible and available for discussion with employees. This is consistent with Chern’s talent philosophy and can help limit possible damage done to the reputation of the company, and it may help with recruitment when the company is in a position to hire additional employees. In keeping with Chern’s’ philosophy of treating employees like family, career transition assistance should be provided to separating employees. Assistance can be in the form of career counseling; personal counseling; career/skill and career transition training; relocation assistance; outplacement assistance; resume writing assistance; access to office equipment; paid time off; child care assistance; financial counseling; access to job fairs; and Internet job placement sites. Regularly review downsizing activities and outcomes to minimize adverse impact, and to allow future downsizings to be completed more effectively. CHAPTER 13: STAFFING SYSTEM EVALUATION AND TECHNOLOGY Chern’s wants a way to find out whether or not your recommendations helped it reach the following goals: 1. Attracting a more diverse set of qualified applicants 2. Complying with equal employment opportunity and affirmative action guidelines 3. Hiring sales associates who: a. Are better able to execute its business strategy b. Sell more merchandise c. Develop higher-quality relationships with the firm’s customers d. Stay with the company longer e. Are more promotable to department manager positions f. Reinforce the company’s customer service–oriented culture and make every employee and customer feel valued and cared for 4. Realizing a meaningful positive return on its investment in your recommendations To help it track its staffing performance, Chern’s asks you to create a digital staffing dashboard that contains the five most important staffing indicators to which its store managers need to pay attention in terms of the sales-associate hiring and evaluation process. Chern’s has always been willing to invest in technologies and tools that improve its performance. It asks you to recommend various staffing technologies it should consider adopting to enhance the performance and efficiency of its staffing system. Because the company is financially conservative and is willing to invest in compelling technologies but does not want to waste its money, be sure to thoroughly explain your recommendations and persuade the company to consider adopting them. With your completed set of recommendations, write an executive summary that describes your overall recommendations for the entire staffing system at Chern’s (covering Chapters 1 through 13). This summary should cover the entire project yet it should be concise enough to go at the front of the report to highlight the most important recommendations you have made (e.g., one to three pages long). Sample answer: Staffing evaluation is the analysis of a staffing system to determine its performance and effectiveness. A digital dashboard with top 5 indicators has been created, in order to track the staffing performance and see if staffing has been able to help Chern’s reach its goals of: 1) Attracting a more diverse set of qualified applicants 2) Compliance with EEO and affirmative action guidelines 3) Hiring sales associates who: a. Are better able to execute it’s business strategy b. Sell more merchandise c. Develop higher-quality relationships with the firm’s customers d. Stay with the company longer e. Are more promotable to department manager positions f. Reinforce the company’s customer service-oriented culture and make every employee and customer feel valued and cared for 4) Realizing a meaningful and positive ROI There are many indicators and measures that can be used to evaluate the above goals, including: Diversity of the applicants - This is important to ensure that the company has diverse talent. The first step is ensure that the sourcing methods are able to attract a diverse slate of applicants. Turnover rates of top performers – It is important to track the turnover rates of top performers. It is important that top performers stay with the company for as long as possible. Longer tenures allow sales associates to build relationships with customers which is critical for customer service, generating revenues, and executing business strategy. Customer satisfaction - Excellent customer service is one of the most important factors of the company strategy. It is important to keep track of customer satisfaction and sales. Employee promotion rates – Internal growth through promotions is one of the most important aspects of Chern’s culture. Promotions also play a key role in employee retention. Revenue generation – To ensure Chern’s continued growth, it is extremely important that the sales associates generate revenue. This should be one of the key measures for employee performance. Digital Dashboard Sample Metric Formats Technology Suggestions Technology affects both the efficiency, and effectiveness of an organization’s staffing procedure. Appropriate use of technology can help Chern’s better track its available talent pool, reduce hiring costs, hire faster and more efficiently, and evaluate the success of the staffing efforts. Some of the technology options that Chern’s should consider are: 1. Resume Screening Software – This software can screen thousands of resumes for certain keywords and phrases in a very short period of time, saving a lot of time and effort. 2. Applicant Tracking System – ATS software allows recruiters to oversee the entire recruitment process from searching of resumes to identifying qualified candidates, conducting background checks, facilitating onboarding by tracking completed tasks and activities, and automatically sending relevant information to new hires. An ATS can reduce costs and enhance the speed and efficiency of a company’s hiring process because they maintain a database of both applicant and job information, and enable staffing system evaluation. 3. Human Resource Information Systems – HRIS and HRMS support modern day HR departments by combining separate HR systems into a centralized database that performs a majority of HR functions. This combination of software and hardware has reporting capabilities and is able to track applicants even before they become employees, facilitate onboarding of existing employees, report and analyze employee information. 4. Company Web Sites and Intranets – Company Web sites and intranets enable effective communication and provide information on internal job openings, career opportunities, and developmental resources. They can assist external and internal recruiting, reducing hiring time, and increasing hiring efficiency. They should provide accurate information and promote Chern’s employer image, as well as its values that are attractive to most new employees. However, it is important to remember that: 1. E-recruiting systems should be used to hire a large number of candidates, and for targeted recruiting. It is important to provide accurate and realistic company information, and ensure that e-staffing systems are aligned with the company’s strategic objectives and goals. 2. No single system should be used as the sole source of recruiting. 3. Applicant feedback regarding recruiting methods used, and their effectiveness, should be collected. 4. To attract a diverse pool of applicants, care should be taken to ensure that staffing systems are culturally sensitive, and possibly include special features like different languages (for example, Spanish). 5. E-staffing systems should be guided by privacy protection policies like restricted data access, and collection of job related data during the screening process. Executive Summary Executive summaries will differ. Summary of Chern’s Case Study Assignments The following is a compiled list of all assignments to be completed in the case study. The specific details are found in each chapter assignment. 1. a. Identify realistic long-term and short-term process and outcome goals. b. Ensure goals are related to business strategy and explain why each is important. 2. a. Develop a formal talent philosophy, HR strategy, and specific staffing strategy. b. Address each of the nine strategic staffing decisions. c. Explain each of your recommendations for the nine decisions. 3. a. Use stock, flow, and concentration statistics to determine if any evidence of discrimination exists. b. Recommend strategies to alleviate any discrimination you find. 4. a. Using O*Net and other sources of data, create a job requirements matrix. b. For each competency or KSAO, decide if it should be used to hire or plan to develop. c. Estimate how important each characteristic is relative to the others as well as the relative time spent on each job duty. d. Create a job rewards matrix. 5. a. Conduct a transition analysis. b. Summarize the internal labor market and highlight any trends or forecasted gaps. c. Based on the transition probability matrix, calculate how many new full-time sales associates should be hired externally. d. Calculate the number of applicants needed to acquire the number of new hires you forecasted. e. Use multiple sources of data to describe the current and future labor market for retail salespeople. If you forecast a gap, determine whether the gap is temporary or permanent. Make some recommendations to address the gap. 6. a. Rank order the recruiting sources based on their ability to maximize the company’s staffing goals. b. Provide recommendations on how the Internet might be more effectively used to source and recruit applicants. c. Conduct a Boolean search to source two promising applicants using the Internet. Include the search engines and exact Boolean commands used. Provide information about your two leads in an appendix. Justify each recommendation. d. Determine how Chern’s can improve the diversity of its applicant pool. 7. a. Develop an outline for a recruiting guide. b. Determine how to increase fairness perceptions of the recruiting process and reduce any negative spillover effects. c. Determine what the employer brand should be. d. Make recommendations for how the brand can be marketed and reinforced throughout the staffing process. e. Explain why your approach would be effective. 8. a. Read the next few parts then evaluate the eight candidates’ résumés. b. Create a scoring key for the interviews. 9. a. Develop an assessment and selection plan that does not exceed the remaining $4,000 budget. b. Justify your proposed selection system c. Submit your assessment plan to your instructor. Receive scores from your instructor. d. Use the scoring key you developed for the structured interviews to view and score the eight structured interviews. Also, view and score the eight unstructured interviews. 10. a. Improve internal promotion practices. b. Recommend ways to identify and develop sales associates who have the potential to become department managers. 11. a. Develop a rational way of combining the scores on the assessment methods you recommended. Recommend either a multiple hurdles, compensatory, or combined approach and explain. b. Describe the weights for each assessment method when calculating the overall score. c. Using your interview score results, candidate résumés, and scores on the assessment methods you included in your assessment plan, identify which two candidates should receive an offer. d. Submit this information along with the rationale for your choices. e. Explain what additional information you would like to have had before making a hiring decision. f. Write a job offer letter to the top candidate of your two selections. g. Receive feedback from your instructor on the outcomes for the candidates you chose. h. Calculate the ROI or net return of your staffing investment for the two people you selected. Interpret the ROI or net return. 12. a. Write a report recommending appropriate onboarding and socialization strategies, and explain why you are making each recommendation. b. Develop a retention plan for the company’s top performers. c. Identify a downsizing strategy to reduce the number of sales associates by 15 percent. 13. a. Create a digital staffing dashboard with the five most important indicators of the overall staffing process. b. Recommend various staffing technologies to enhance the performance and efficiency of the staffing system. c. Thoroughly explain your recommendations and persuade the company to consider adopting them. d. Write an executive summary of the entire set of recommendations and place it at the front of the report. Instructor Manual for Strategic Staffing Jean M. Phillips, Stan M. Gully 9780133571769