Chapter Three

People Resourcing/
Human Resource acquisition

HRM 2021, Set BY Dr. Habtamu Dadi

People resourcing concept
People resourcing is concerned with insuring that the
organizations obtains and retains the people it needs
and employs them productively.

It is also about those aspects of employment practice

that are concerned with welcoming people to the
organization and, if there is no alternative releasing
them.

HRM 2021, Set BY Dr. Habtamu Dadi

People Resourcing

People resourcing , which is concerned with taking steps

to ensure that the organization obtains and keeps the
people it needs and employs them efficiently.
Acquisition of Human Resource refers to the process
employers use for recruiting, tracking and
interviewing job candidates, and on boarding and
training new employees. It is usually a function of the
human resources (HR) department.

HRM 2021, Set BY Dr. Habtamu Dadi

 The objective of people resourcing
The aim of people resourcing is to ensure that a firm
achieves competitive advantage by attracting and
retaining more capable people than its rivals and
employing them more effectively.


HRM 2021, Set BY Dr. Habtamu Dadi

 The components of
people resourcing/ acquisition
1. Human resource planning
2. Recruitment and selection strategy
3. Placement and introduction
4. Release from the organization

HRM 2021, Set BY Dr. Habtamu Dadi

 Section 1
Human Resource Planning

HRM 2021, Set BY Dr. Habtamu Dadi

Human resource planning defined
Human resource planning is the process of analysing and
identifying the need for, and availability of human
resources so that the organization can meet its objectives.
The focus of HRP is to ensure that the organization has got
the the :
 right number of human resource

 the right capability/kinds of people,

 in the right places,

 At the right time,

Capable of effectively and efficiently completing those

tasks that will help the organization achieve its overall
strategic objectives (Aswathappa 2002).
HRM 2021, Set BY Dr. Habtamu Dadi
 It is the process of assessing the future supply of and
demand for human resources.
 It also provides mechanisms to eliminate any gaps that may
exist between supply and demand
 It is a process of determining what positions in the firm will
have to be filled and when
 Human Resource planning translates the organization’s
overall goal into the number and types of workers needed to
meet those goals.
 Without clear-cut planning, estimation of an organization’s
human resource need is reduced to mere guesswork.
 Thus, HR planning determines the number and types of
employees to be recruited into the organization or phased
out of it

HRM 2021, Set BY Dr. Habtamu Dadi

Human Resource planning defined
 HR Planning includes all activities managers
do to forecast current and future HR needs.
 Must be done prior to recruitment and selection
 Demand forecasts made by managers estimate
the number & qualifications the firm will need/
required in future.
 Supply forecasts estimate the size and quality of
present and potential human resources available
from within and outside the organisation to
meet the future demand of human resources.

HRM 2021, Set BY Dr. Habtamu Dadi

Aims of human resource planning
The objectives of human resource planning may be
summarized as below:
1. To ensure optimum utilization of human resources
currently available in the organization.
2. To assess or forecast the future skill requirement of
the organization.
3. To provide control measures to ensure that necessary
resources are available as and when required.
Coping with changes: Market condition, technology,
product and government regulation, internal factors.
HRM 2021, Set BY Dr. Habtamu Dadi
Why is human resource planning
A series of specified reasons are there that attaches importance to manpower
planning and forecasting exercises. They are elaborated below:
 To link manpower planning with the organizational planning
Helps to identify critical HR gaps and how gaps will be addressed
 To determine recruitment levels.
 To anticipate redundancies.
 To determine optimum training levels.
 To provide a basis for management development programs.
 To cost the manpower.
 To assist productivity bargaining.
 To assess future accommodation requirement.
 To study the cost of overheads and value of service functions.
 To decide whether certain activity needs to be subcontracted, etc.

HRM 2021, Set BY Dr. Habtamu Dadi

Human resource planning process
Seven steps can be identified in the process of
human resources planning.
• Analyze Objectives. ...
• Inventory current human resources. ...
• Forecast the demand and the supply of employees.
• Estimate Gaps. ...
• Formulate Plan. ...
• Implement Plan. ...
• Monitor, Control, and feedback.

HRM 2021, Set BY Dr. Habtamu Dadi

Approaches to Effective human resource
planning
It includes analysing the current workforce, determining
future workforce needs, identifying the gap between the
present and the future, and implementing solutions so that
an organisation can accomplish its mission, goals, and
strategic plan.
Environmental scanning (Scenario planning)
Labor demand forecast
Labor supply forecast
Gap analysis
Action programming
Control and evaluation
HRM 2021, Set BY Dr. Habtamu Dadi
Approaches to Effective Human Resource Planning
Scenario planning is simply an assessment of the
environmental changes that are likely to affect the
organization so that a prediction can be made of the
possible situations that may have to be dealt with in
the future. (Economic, technological, demographic,
political, social factors)

HRM 2021, Set BY Dr. Habtamu Dadi

Demand forecasting
Demand forecasting is the process of estimating the
future numbers of people required and the likely skills
and competences they will need.
The basis of the forecast are analysis of external and
internal factors.
- External factors:- competition, law and regulation,
change in technology
- Internal factors:- budget, production
level, organizational structure, longer-term
business plan
HRM 2021, Set BY Dr. Habtamu Dadi
The demand forecasting methods

Demand forecasting – estimate future needs for

people and competences by reference to corporate and
functional plans and forecasts of future activity levels.
The demand forecasting methods /techniques for
estimating the numbers of people required are:-
1. Managerial judgement
2. Ratio-trend analysis
3. Work study techniques
4.Forecasting skill and competence requirements

HRM 2021, Set BY Dr. Habtamu Dadi

Managerial Forecasting: This simply requires managers to
sit down, think about their future workloads, and decide how
many people they need.
Ratio-trend analysis: studying past ratios between, say, the
number of direct (production) workers and indirect (support)
workers in a manufacturing plant, and forecasting future
ratios.
Work study techniques: apply work measurement to
calculate how long operations should take and the number of
people required.
Forecasting skill and competence requirements: a careful
analysis of the impact of projected product-market
developments and the introduction of new technology, either
information technology or computerized manufacturing.

HRM 2021, Set BY Dr. Habtamu Dadi

Supply forecasting
Supply forecasting – estimate the supply of people by
reference to analyses of current resources and future
availability, after allowing for wastage. The forecast will
also take account of labour market trends relating to the
availability of skills and to demographics.
Or
Supply forecasting measures the number of people
likely to be available from within and outside the
organization, after making allowance for absenteeism,
internal movements and promotions, wastage and
changes in hours and other conditions of work.
HRM 2021, Set BY Dr. Habtamu Dadi
In assessing the supply of labor available to the
organization, there are two major areas to be reviewed
- internal supply
- external supply
Internal supply of human resource available by way
of transfers, promotions, retired employees & recall
of laid- off employees, etc.
Source of external supply of human resource
is availability of Labour force in the market and new
recruitment. 
HRM 2021, Set BY Dr. Habtamu Dadi
Gap Analysis
 An HR gap analysis is a breakdown of your current
workforce and the skills they possess compared to the
workforce you will need to reach key business goals. ...
Conducting an HR gap analysis can help you set your
organization up for long-term, sustainable success
Forecasting requirements – analyze the demand and
supply forecasts to identify future deficits or surpluses with
the help of models, where appropriate.
 It is used to reconcile the forecast of labor demand and
supply. At minimum, this process identifies potential
shortage or surpluses of employees, skills and competencies.

HRM 2021, Set BY Dr. Habtamu Dadi

Forecast of future requirements
Human resource forecasting is the process of
estimating the future quantity and quality of people
required. The basis of the forecast must be the annual
budget and long term corporate plan translated into
activity levels for each function and department.

HRM 2021, Set BY Dr. Habtamu Dadi

To forecast future requirements it is necessary to analyse the
demand and supply forecasts to identify any deficits or
surpluses. The analysis can be made with the help of
spreadsheets.
 It can be set out as follows:
1. Current number employed 70
2. Annual level of turnover 10%
3. Expected losses during year 7
4. Balance at end year 63
5. Number required at end year 75
6. Number to be obtained during year (5 _ 4) 12
HRM 2021, Set BY Dr. Habtamu Dadi
Action planning – prepare plans to deal with forecast
deficits through internal promotion, training or
external recruitment. If necessary, plan for
unavoidable downsizing so as to avoid any compulsory
redundancies, if that is possible. Develop retention
and flexibility strategies.
Action plans are derived from the broad resourcing
strategies and the more detailed analysis of demand
and supply factors.

HRM 2021, Set BY Dr. Habtamu Dadi

Control and evaluation
Control and evaluation monitor the effectiveness of
human resource plans over time.
Deviations from the plans are identified and actions
are taken.
The extent to which human resource objective have
been met is measured by the feed back form various
outcomes.
It has been suggest that essentially long range
planning activities require the attainment of short run
objectives.
HRM 2021, Set BY Dr. Habtamu Dadi
HRM 2021, Set BY Dr. Habtamu Dadi
Student self Discussion
Our country registered remarkable economic growth in past ten years.
Number of universities (higher educations) were also radically increasing
(results to large number of graduates)
Our industries are also growing. But can not accommodate these all university
graduates.
Our concern is unemployment
Still some organizations suffer from shortage of skilled man power
This issue brings some questions in one’s mind.
Really did the qualities in terms of profession much with what
organizations in Ethiopia demands.
Or
How much our universities are sure that they produce Human Capital
required by organization in Ethiopia?
Of course such issue needs intensive research.

HRM 2021, Set BY Dr. Habtamu Dadi

 Section 2
Recruitment and Selection

HRM 2021, Set BY Dr. Habtamu Dadi

Recruitment and selection
Once the required number and kind of human resources are
determined, management has to find the places where required
human resources are available and also find the means of attracting
them towards the organisation before selecting suitable candidates for
jobs. All this process is generally known as recruitment.
Recruitment is the process by which a job vacancy is identified and
potential employees are notified.
It is the process of finding and attracting capable applicants who
have the abilities, skills, and experience that will help an
organization achieve its goals.
The nature of the recruitment process is regulated and subject to
employment law.

HRM 2021, Set BY Dr. Habtamu Dadi

Selection is the process concerned with deciding
which applicants or candidates should be appointed to
jobs

HRM 2021, Set BY Dr. Habtamu Dadi

Purpose and Importance
What is the purpose and importance of Recruitment?
Why was the person selected to perform the job is not
performing effectively?

HRM 2021, Set BY Dr. Habtamu Dadi

Purpose and Importance
The general purpose of recruitment is to provide a pool of
potentially qualified job candidates.
Specifically:-
1. Determine the present and future requirements of the
organization in conjunction with its personal and job analysis
activities
2. Increase the pool of job candidates at minimum cost
3. Help increase the success rate of the selection process by
reducing the number of visibly under qualified or over qualified
applicants
4. Help reduce the probability that job applicants once recruited
leaving the organization
HRM 2021, Set BY Dr. Habtamu Dadi
Purpose and Importance- cont
5. Meet the organization legal and social obligations
regarding the composition of its work force
6. Begin identifying and preparing potential job
applicants who will be appropriate candidates
7. Increase organizational and individual effectiveness
in the short term and long term
8. Evaluate the effectiveness of various recruiting
techniques and sources for all types of job applicants.

HRM 2021, Set BY Dr. Habtamu Dadi

Recruitment and selection steps/stages
1. Defining requirements –
- preparing role profiles and person specifications ( job analysis,
description, specification). We use this opportunity to design job, we
should not do recruitment for sake of vacancy.
- deciding terms and conditions of employment (employment law,
personal policy, procedure, who involved etc).
2. Planning recruitment campaigns.
3. Attracting candidates – reviewing and evaluating alternative
sources of applicants, inside and outside the company: advertising, e-
recruiting, agencies and consultants.
4. Selecting candidates – sifting applications, interviewing, testing,
assessing candidates, assessment centres, offering employment,
obtaining references; preparing contracts of employment.

HRM 2021, Set BY Dr. Habtamu Dadi

Identify sources of candidates
Once you established criteria you look for person who
meet criteria. You must make known for people that a
vacancy exists.
Internal Sources

External Sources

HRM 2021, Set BY Dr. Habtamu Dadi

Internal Recruiting
Mangers turn to existing employees to fill open positions/
positions filled within the firm
Advantages
- Lower risk
- Short time to fill
- Lower costs
- Internal competition
- Faster integration
- used as techniques motivation
- loyalty, commitment, sense of belongingness
Disadvantages
- to much consumption of sugar test bitter
- higher training cost
- disappointed colleagues
- discourage flow of new blood, innovation, new idea

HRM 2021, Set BY Dr. Habtamu Dadi

External Recruiting
 looking outside the organization for people who
have not worked at the firm previously.
- news papers advertisements, open house, on-
campus recruiting, employee referrals, and through
the internet.

HRM 2021, Set BY Dr. Habtamu Dadi

Advantages and Disadvantages of external
recruitment
Advantages
- Having access to a potentially large applicant pool
 Being able to attract people who have the skills, knowledge, and abilities an
organization needs
 Bringing in newcomers who may have a fresh approach to problems and be up
to date on the latest technology
 HR mix with different background

Disadvantages
 Relatively high cost
 Candidate may lack knowledge about the inner workings of the organization
 May need to receive more training
 Uncertainty concerning whether they will actually be good performers

HRM 2021, Set BY Dr. Habtamu Dadi

Factors Governing Recruitment
The factors affecting recruitment can be classified as internal and external factors
The internal factors are:
 Wage and salary policies;
 The age composition of existing working force;
 Promotion and retirement policies;
 Turnover rates;
 The nature of operations involved the kind of personnel required;
 The level and seasonality of operations in question;
 Future expansion and reduction programmes;
 Recruiting policy of the organisation;
Human resource planning strategy of the company;
 Size of the organisation
Cost involved in recruiting employees, and finally;
 Growth and expansion plans of the organisation.

HRM 2021, Set BY Dr. Habtamu Dadi

Factors Governing Recruitment- cont
The external factors are:
 Supply and demand of specific skills in the labour
market;
 Company’s image perception of the job seekers about
the company.
 External cultural factors: For example, women may
not be recruited in certain jobs in industry.
 labour market
 Political and legal factors
Sons of soil
HRM 2021, Set BY Dr. Habtamu Dadi
Methods of Recruitment
Various methods employed for recruiting employees
1. Advertising
Alternative methods
2. Online recruitment
3. Using agencies and job centres
4. Using recruitment consultants
5. Using executive search consultants (head hunters) used
for high profile appointment
6. Recruitment process outsourcing
7. Educational and training establishments
HRM 2021, Set BY Dr. Habtamu Dadi
Advertising
Depends on organization policy and rules
What we consider
 Content of advertisement (job, location, salary)
 Media used ( some times we use web site and news
paper for Janitors which I assume is wrong)
 Time of advertisement
 Check to avoid discrimination on advertisement

HRM 2021, Set BY Dr. Habtamu Dadi

Alternative to Recruitment
If recruitment cost is high
If it is difficult to enter immediate recruitment
because of lack of HRP organizations use alternative
approaches.
 Over time
 Sub contracting
 Hiring temporary employees
 Employee leasing
Discuss on this points

HRM 2021, Set BY Dr. Habtamu Dadi

HR planning/Outsourcing
 Outsourcing: managers can decide to contract
with outside workers rather than hiring them.
 Outsourcing is more flexible for the firm.
 Outsourcing often provides human capital at a lower cost.
 Outsource problems: managers lose control over
output.
 Outsource contractors are not committed to the firm.
 Unions typically are against outsourcing that has
potential to eliminate member’s jobs.

HRM 2021, Set BY Dr. Habtamu Dadi

Selection
Human resource selection is the process of choosing
qualified individuals who are available to fill positions in
an organization from the pool of candidates.
 Selection is the process of choosing people by obtaining
and assessing information about the applicants with a
view to matching these with the job requirements. It
involves a careful screening and testing of candidates who
have put in their applications for any job in the
enterprise. It is the process of choosing the most suitable
persons out of all the applicants. The purpose of selection
is to pick up the right person for every job.
HRM 2021, Set BY Dr. Habtamu Dadi
Selection
The aim of selection is to assess the suitability of candidates
by predicting the extent to which they will be able to carry
out a role successfully. It involves deciding on the degree to
which the characteristics of applicants in terms of their
competencies, experience, qualifications, education and
training match the person specification. It also involves
using this assessment to make a choice between candidates.
The objective of selection process is to determine
whether an applicant meets the qualification for a specific
job and to choose the applicant who is most likely to
perform well in that job.

HRM 2021, Set BY Dr. Habtamu Dadi

Selection Procedure
 The selection procedure cannot be effective until and
unless:
1. Requirements of the job to be filled, have been
clearly specified (job analysis, etc.)
2. Employee specifications (physical, mental, social,
and behavioural, etc.) have been clearly specified
3. candidates for screening have been attracted.
Thus, the development of job analyses, human
resource planning and recruitment are necessary
prerequisites of the selection process
HRM 2021, Set BY Dr. Habtamu Dadi
The major factors which determine the steps involved
in a selection process are as follows
 There is no standard selection process that can be
followed by all the companies in all the areas.
Companies may follow different selection techniques
or methods depending upon the size of the company,
nature of the business, kind and number of persons to
be employed, government regulations to be followed,
etc.
Thus, each company may follow any one or the
possible combinations of methods of selection in the
order convenient or suitable to it.

HRM 2021, Set BY Dr. Habtamu Dadi

A comprehensive selection process involves
the various steps
Job analysis
Recruitment
Application pool and form (CV)
Preliminary Screening (short listing)
Preliminary interview
Group discussion
Tests (Intelligence test, Aptitude test, Achievement test, Interest test and
personality test, Judgment test)
 Final interview
Medical examination
Reference check
Final decision by the line manager
Employment

HRM 2021, Set BY Dr. Habtamu Dadi

What are you looking for in the candidate in
Interview
Could the candidate do the job (skill, qualification,
intelligence)
Would the candidate do the job (motivation)
Would the candidate fit in (personal characteristics)

Interview has its own procedure students are advised

to read text books.

HRM 2021, Set BY Dr. Habtamu Dadi

Selection Tests
Selection Tests: Many organisations hold different kinds
of selection tests to know more about the candidates or to
reject the candidates who cannot be called for interview
etc.

Selection tests normally supplement the information

provided in the application forms. Such forms may
contain factual information about candidates. Selection
tests may give information about their aptitude, interest,
personality, which cannot be known by application
forms.
HRM 2021, Set BY Dr. Habtamu Dadi
Types of Selection Test
Physical ability
intellectual ability
Aptitude Tests
Personality Tests
Interest Tests
Psychological tests
Performance Tests
Intelligence Tests
Knowledge Tests
Achievement Tests
HRM 2021, Set BY Dr. Habtamu Dadi
 Rules of Good Testing
Norms should be developed for each test. Their validity and
reliability for a given purpose should be established before they
are used.
 Reliability: the degree to which the tool measures the
same thing each time it is used.
 Scores should be close for the same person taking the
same test over time.
 Validity: Does the test measure what it is supposed to
measure?
 Example: does a physical ability test really predict the
job performance of a firefighter?
Managers have an ethical and legal duty to develop good
selection tools.
HRM 2021, Set BY Dr. Habtamu Dadi
 Adequate time and resources must be provided to design,
validate, and check tests.
 Tests should be designed and administered only by trained and
competent persons.
 The user of tests must be extremely sensitive to the feelings of
people about tests.
 Tests are to be uses as a screening device.
 Reliance should not be placed solely upon tests in reaching
decisions.
 Tests should minimize the probabilities of getting distorted
results. They must be ‘race-free’

HRM 2021, Set BY Dr. Habtamu Dadi

 Section 3
Introduction to the Organization
Socialization// Induction

HRM 2021, Set BY Dr. Habtamu Dadi

Induction
Induction is the process of receiving and welcoming
employees when they first join a company and giving
them the basic information they need to settle down
quickly and happily and start work.
It is also called orientation and is designed to provide
a new employee with the information he or she needs
to function comfortably and effectively in the
organization.

HRM 2021, Set BY Dr. Habtamu Dadi

Some companies do not lay emphasis on this function
as they view that this function will be automatically
performed by the colleagues of the new employees

HRM 2021, Set BY Dr. Habtamu Dadi

Topics covered under induction/orientation
Organizational issues (history, organization chart,
name and title of key executives, employee title and
department, lay out of physical facilities, production
process, company policy and rules, regulations, etc)
Employee benefits
Introduction to supervisor, co-workers
Job duties (location, tasks, relationship to others jobs
etc)

HRM 2021, Set BY Dr. Habtamu Dadi

Aim of induction
 1. Smooth the preliminary stages when everything is
likely to be strange and unfamiliar to the starter.
2. Establish quickly a favorable attitude to the
organization in the mind of new employees so that
they are more likely to stay.
3. Obtain effective output from the new employee in
the shortest possible time.
4. Reduce the likelihood of the employee leaving
quickly.

HRM 2021, Set BY Dr. Habtamu Dadi

Reception
Most people suffer from some feelings of anxiety when
they start a new job.
They may well be asking themselves,
- what will the company be like?
- How will my boss behave to me?
- Will I get on with the other workers?
- Will I be able to do the job?
These questions or general fears may be alleviated
by ensuring the first contacts friendly and helpful.

HRM 2021, Set BY Dr. Habtamu Dadi

Documentation
A variety of documents may then be issued to
employees, including safety rules and safety literature,
a company rule book or an employee handbook.

HRM 2021, Set BY Dr. Habtamu Dadi

Initial briefing
The member of the Human Resource department or
other individual who is looking after new employee
should take new employee to the work place and
introduce to the team or manager.

HRM 2021, Set BY Dr. Habtamu Dadi

Introduction to the workplace
New starters will be concerned about who they are
going to work for (their immediate manager or team
leader), who they are going to work with, what work
they are going to do on their first day and the
geographical layout of their place of work (location of
entrances, exits, lavatories, restrooms and the
canteen).
This will be introduced by employee immediate
manager

HRM 2021, Set BY Dr. Habtamu Dadi

Formal Induction course
A formal course is an opportunity to deliver messages
about the organization, its products and services, its
mission and values.

HRM 2021, Set BY Dr. Habtamu Dadi

On-the-job induction training
Most new starters other than those on formal training
schemes will learn on-the job, although this may be
supplemented with special off-the-job courses to
develop particular skills or knowledge.

HRM 2021, Set BY Dr. Habtamu Dadi

 Section 4
Release from the Organization

HRM 2021, Set BY Dr. Habtamu Dadi

Release from the Organization
Redundancy (a situation in which someone has to
leave their job, because they are no longer needed [=
layoff ])
Dismissal
Retirement

HRM 2021, Set BY Dr. Habtamu Dadi

 Redundancy
Redundancy takes place when the organization as a whole is
going through a downsizing exercise, when structural
changes are being made, following mergers and acquisitions,
and when individual jobs are no longer needed.
If, unfortunately, redundancy has to take place, it is
necessary to plan ahead – seeking and implementing
methods of avoiding redundancy as far as possible, making
arrangements for voluntary redundancy and helping people
to find jobs (outplacement).
HR usually has the responsibility of handling the
redundancy.

HRM 2021, Set BY Dr. Habtamu Dadi

 Dismissal
Dismissal takes place when an employer terminates
the employment of someone with or without notice. A
contract can be terminated as a result of demotion or
transfer as well as dismissal.
People can be ‘constructively dismissed’ if they resign
because of their employer’s unreasonable behavior.

Dismissals should be handled in accordance with the

principles of natural justice.

HRM 2021, Set BY Dr. Habtamu Dadi

 Retirement
Retirement is a major change and should be
prepared for. Retirement policies need to specify:
- when people are due to retire;
 the circumstances, if any, in which they can work
beyond their normal retirement date;
- the provision of pre-retirement training on such
matters as finance, insurance, state pension rights and
other benefits, health, working either for money or for a
voluntary organization, and sources of advice and help;
- the provision of advice to people about to retire.
HRM 2021, Set BY Dr. Habtamu Dadi