Human Resource Management: Recruitment, Diversity, and Compensation Strategies

Talent Acquisition and Candidate Selection

Key Definitions

• Recruitment: Attracting potential candidates.
• Selection: Evaluating and choosing the right candidate.

The ASA Model (Attraction-Selection-Attrition)

• Attraction: People are drawn to organizations with similar values.
• Selection: Organizations hire those who fit the culture and job requirements.
• Attrition: Misfits leave, leading to cultural homogeneity (risk: reduced diversity).

Concept of "Fit"

• Person–Job Fit: Matching skills against job requirements.
• Person–Organization Fit: Alignment of individual values with organizational culture.

Why Fit Matters

Higher performance, satisfaction, and retention. However, too much focus on fit can hurt diversity and innovation.

Recruitment and Selection Strategies

• Recruitment Strategies: Employer branding, social media outreach, and employee referrals.
• Selection Methods: Structured interviews, standardized tests, and work samples. Focus on validity and reliability.

Ethical and Modern Challenges

AI bias, fairness, transparency, and algorithmic hiring practices.

Conclusion on Fit

Fit is useful but not absolute. It must be combined with fairness, validity, and diversity efforts. There is a strong link between appropriate fit and organizational culture and performance.

Equity, Diversity, and Inclusion (ED&I)

Core Concepts

• Equity: Fairness, ensuring equal opportunity by removing systemic barriers.
• Diversity: The presence of differences (e.g., background, identity, experience).
• Inclusion: Ensuring participation, belonging, and value for all individuals.

Three Main Justifications for ED&I

1. Moral Case: Driven by social justice principles.
2. Legal Case: Compliance with anti-discrimination laws.
3. Business Case: Leads to innovation and competitiveness.

Inclusion: Turning Diversity into Engagement

Inclusion fosters belonging, psychological safety, and authenticity.

Inclusive Leadership

Characterized by being open, empathetic, and fair.

Challenges in Implementing ED&I

• Symbolic actions or quotas without genuine culture change.
• Lack of representation in leadership positions.
• Ignoring intersectionality (the interconnected nature of social categorizations).

Global Variation

Priorities differ by country (e.g., focus on gender, race, disability). Strategies must be context-sensitive.

Ways Forward

Moving from mere compliance toward organizational transformation. Integrating ED&I into core culture and strategy. Measuring inclusion, not just demographic numbers.

Conclusion on ED&I

ED&I is both a moral imperative and a strategic necessity. Organizations must build equitable systems to achieve real inclusion.

Compensation and Strategic Rewards

Definitions

• Compensation: Pay provided for work performed.
• Rewards: Financial and non-financial incentives.
• Strategic Reward: Aligning compensation and rewards with overall business goals.

Purpose of Pay

Compensation supports employee needs and satisfaction, and rewards performance to drive strategic outcomes.

Types of Rewards

• Total Rewards: Base pay + benefits + incentives.
• Short-term Rewards: Bonuses and commissions.
• Long-term / Deferred Rewards: Stock options and profit sharing.
• Note: Risk level varies depending on the link to performance.

Motivational Theories Applied to Pay

• Herzberg's Two-Factor Theory: Pay is a hygiene factor (prevents dissatisfaction).
• Locke's Goal-Setting Theory: Motivation increases when rewards are tied to specific performance targets.
• Vroom's Expectancy Theory: Effort leads to performance, which leads to reward (if the reward is perceived as fair and valuable).

Performance-Related Pay (PRP)

PRP links employee effort directly to organizational outcomes.

• Benefits: Alignment with organizational goals.
• Limits: Often fails if goals are unclear or the process is perceived as unfair.

Critical Points on Reward Systems

• Pay affects people differently based on age, culture, and values.
• Systems should combine extrinsic (financial) and intrinsic (non-financial) rewards.
• Avoid overreliance on money, as this can negatively impact teamwork and creativity.

Current Challenges

• Gender pay gap and general fairness issues.
• Transparency and affordability of compensation structures.
• Cross-country variation in pay systems and regulations.

Conclusion on Rewards

Organizations must mix financial and non-financial rewards, ensure fairness, clarity, and transparency, and align pay systems with employee motivation and long-term performance.