IN SME S USING INTERNET AS A RECRUITMENT TOOL. Prof. Dr. Hasan İBİCİOĞLU Epoka University, ALBANIA & Suleyman Demirel University, TURKEY

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1 IN SME S USING INTERNET AS A RECRUITMENT TOOL Prof. Dr. Hasan İBİCİOĞLU Epoka University, ALBANIA & Suleyman Demirel University, TURKEY ABSTRACT Dr. Belma KEKLİK Suleyman Demirel University, TURKEY Recruitment is the main essence of the human resource management. Correctly matching the job and the employee is very important for the continuity of the firms. Recruitment is not only an employment process. Finding right person to the right job is one of the major issues for the productivity of firms. In our study conducted among 171 SME in Antalya, Burdur, Isparta in Turkey, it is found that informal recruitment methods are mostly used. According to the study first method preferred by the SME is advertisement. The least preferred method is internet. Even if internet is the main tool today, it is an upset for SME not using internet effectively. Internet reduce the recruitment costs and give facility to reach a large range of candidate. In this study importance of internet as a recruitment tool is implied and recruitment methods used in SME is pointed out. Keywords: Recruitment, Human Resource Management, SME s, 1. WHAT IS RECRUITMENT Recruitment concerns finding the employees who have the needed qualifications for the position to be filled and trying to hire them for that position in the firm. (Bingöl, 1990:76) According to Dowling and Schuler recruitment is searching and finding the suffcient quantity and quality of work force and then selecting the right person for the needed position among those candidates. (Bolton, 2002, 32) Recruitment is the preceding step of the selection. Advertising the job to a local newspaper is a recruitment activity, accepting the candidate to the needed job with an ability test is selection activitiy. (Baroukh and Kleiner, 2002, 28) Another method to distinguish recruitment and selection is thinking recruitment as a plus and thinking selection as a minus. Recruitment is adding, collecting appropriate candidates in a pool and selection is reduction 471

2 of those candidates by employing them for the needed position. Because of this reason these two activities performed by different people. Generally recruitment is done by professional recruitment institutions and selection is made by the firm who will employ the candidate. (Bolton, 2002: 33) In the literature recruitment is seen as a process that should be supported by job analysis, job description and job specification. (Tanova, 2003: 108) During the recruitment process, instead of finding a large number of candidates reaching the qualified candidates to fullfill the aims is important. If the recruitment process effectively completed then selection process will also be effective and easy. (Price, 2000: 116) The first step to atrract the qualified candidates to employ them in the firm is human resource management planning and deciding needed personnel quality and quantity according to the jobs. Second step is to contact with the potantial candidates by using various recruitment methods. Next step is selecting the most qualified and beneficial personnel among the potential candidates. (Daft, 1994: 406) 1.1 RECRUITMENT METHODS There are various methods for recruitment. Mainly two groups of recruitment methods are used by the firms. Internal resources are preferred when the needed candidate supplied from the firm itself, external resources are prefered when the needed candidate supplied from outside of the firm. Internal recruitment methods are: promotion according to performance; promotion according to seniority; job enlargement; rotation and internal transfers. External recruitment methods are: advertisement; internet; walkins; professional recruitment firms (private employment agencies, public employment agencies, human resources firms etc.); environment (recommondation of friends, relatives, current employees and other firms etc.) The prescriptive literature usually makes the distinction between formal recruitment methods, including press advertisements, Jobcentres and other agencies, and more informal methods, such as recommendations from existing staff. Word-of-mouth methods are recognised as having some distinct advantages. As well as the obvious advantages of speed and cost, not only is the new recruit a ``known quantity'', he or she is likely to have been given more prior knowledge about the firm and the job, and what to expect from it (Watson, 1989). Furthermore, existing employees who have recommended people tend to socialise the new recruit because it is in their interests to make sure that the new employee fits in. Word-of-mouth 472

3 recruitment is, therefore, sometimes recommended to employers as a way of reducing staff turnover. (Carroll et al, 1999: 237) In the literature, recruitment methods such as newspaper advertising and the use of employment agencies are regarded as formal recruitment methods and word of mouth and referrals are regarded as an informal recruitment method (Taylor, 1994). (Tanova and Nadiri, 2005, 697) In short, we can say that advertisement, internet and employment agencies are formal recruitment methods; walk-ins and environment are informal recruitment methods. Also e-human resources is a method used in recruitment. Especially to announce the vacancies in the firm, to collect the job applications e-human resources is used by most of the firms. (Bell et all, 2006: 299) E-HRM is application of human resources activities over internet. It is mostly used in conditions that information technologies are used, collectivist human resources activities are performed and network environment is ready. (Strohmeier, 2007: 20) Scott et al (1989) have shown that recruitment methods vary according to industry. In the services and traditional manufacturing sectors, informal recruitment methods are preferred. On the other hand in the high technology sector formal methods are widely used. Atkinson and Meager (1994) state that recruitment methods also vary according to the type of position that needs to be filled. Informal methods are used when managers and manual employees are recruited, while formal methods are used to employ technical or clerical employees. Stewart and Knowles (2000) have shown a positive relationship between the size of an organisation and likelihood of recruiting graduates. (Tanova, 2003: 107) 1.2 INTERNET AS A RECRUITMENT TOOL Technological developments increased the usage of computers and internet by both the organizations and the community. Advantages of modernity to create web sites used by most of the firms to increase employment potential. Researches show that 90% of the American firms created web sites to announce their job vacancies. Firms state that after the main pages of their web sites career pages are the most visited ones. Over the 80% of the CV s are supplied by the web sites. Internet is an important source for both candidates and the organisations. (Cober vd.; 2004, 624) Internet affected the both social and economic life. Organisations changed their management styles and processes. Especially human resources activities differed. E-HRM simplified the application of candidates for the 473

4 jobs and gave facility to increase their ability and information over webbased education activities. (Stone et al., 2006: 229) Some advantages of online recruitment are: low cost, shorter recruitment cycle time, reaches a wider range of applicants, better quality of response, gives the company a more up-to-date image, opportunity to address specific labor market niches, attracts the passive job- seeker, provides global coverage at a constant basis. (Galanaki, 2002: 244) Recruitment through internet decrease the costs and increase the potential applicants quality and quantity for the firms. Job seekers try to make a decision to get the right job and firms should behave accordingly and needs of applicants should be considered. Web sites should be open to interaction, give enough information and be attractive for the applicants. (Maurer ve Liu, 2007, 312) According to some researches, 20% of candidates lose job opportunities because of unprofessionally prepared web sites. Also because of complex prepared web sites 1/3 of candidates can t use the sites effectively. (Maurer and Liu, 2007, 306) So while preparing the web sites, firms should plan it to attract candidates. Because the candidates get information and impression about the firm from the web sites. If this impression is positive then the quality and quantity of the applications will increase. Firms should be careful about some below features to prepare their web sites: (Cober at el., 2004: ) Esthetic: This feature is related the web sites colour, type script, pictures etc. Some researches show that esthetic features of web sites have critical importance to attract the consumers and have emotional contact with them. First impression of candidates occur because of the esthetic of the web sites. Playful Features: Playful features are animation elements such as voices, pictures and videos that give lively excitement to the web sites users. In a research about web sites, factor analysis show that one of the factors of participators evaluation is playfulness, excitement and display. Those features effect the users positively. Practicability: To reach the web sites aim, to get the information convenience of the web sites is very important. One of the hesitates of researchers is ignorance of practicability while preparing the display of web sites. Employment messages should be given to the applicants clearly and directly. Display of the site shouldn t bind the messages. 474

5 2. RECRUITMENT IN SME S Generally, informal recruitment methods are associated with smaller firms (Barber et al., 1999; Carroll et al., 1999; Deshpande and Golhar, 1994). Larger firms are more likely to use formal recruitment methods (Saari et al., 1988). Barber et al. (1999) argue that recruitment in large firms has to be more formal since the firms that have repeated transactions will internalize these transactions in order to make them less costly (Williamson, 1975). Developing formal procedures in order to attract, acquire and evaluate applications for the positions is economically prudent since the cost per applicant of developing the procedures will decrease as the number of hiring decisions increases. Many small firms would remain unconvinced by using formal methods and may find informal approaches more cost effective in the short term (Carroll et al., 1999). (Tanova and Nadiri, 2005, 697) Researches carried on recruitment in small firms, in general have found a reliance on informal methods (see, for example, Curran et al., 1993). Millward et al. (1992) found that, whereas larger enterprises relied greatly on formal methods and bureaucratic procedures by specialist personnel departments, the small business owner/manager is likely to handle recruiting and personnel matters without delegating and is unlikely to have any relevant skills. (Jameson, 2000: 44) For recruitment and selection activities SMEs use unstructured activities and they are performed by unprofessional personnel which reach unsatisfired solutions. So SMEs should use structured recruitment methods and document them. (Stewart ve Knowles, 2000: 77) In many surveys small business have reported that finding comptetent employees is one of their most important problems. (Inc., 1997; Deshpande and Golhar, 1994; Atkinson and Storey, 1994; McEvoy, 1984) Small busineses can not have a large internal labor market and when they lose employees they need to replace them from external market. (Tanova, 2003: 109) Evidence suggests that small firms do, in fact, find it hard to attract the calibre of staff they need. According to Atkinson and Storey (1994) small firms report labour market problems more frequently than any other, including financial problems. The most frequent complaint was with the quality of labour available, including a lack of basic literacy skills, particularly among young people. Scott et al. (1989) also found evidence of dissatisfaction with the quality of labour available for small firms. (Carroll et al, 1999: 238) 475

6 3. RESEARCH METHODOLOGY In Antalya, Burdur and Isparta small and medium sized organisations are decided to be taken in the research. Micro sized organisations which have 1-10 employees are not included since they don t have enough human resource activities for this research. Out of 503 organisations sample size is calculated as 217. ( Simple random sampling is used. According to reliability analysis cronbach s alpha is 0,733. It means the survey is reliable. We couldn t get response from some firms and some of the questionnaires were incomplete. So the total number of participants is RESEARCH FINDINGS To understand which methods are used by SMEs and analyse their preference rate SMEs are given five choice to state their recruitment methods. Participants are requested to give 1 to most preferred recruitment method and 5 to least preferred one. So ordinal responses are obtained. It s shown below table. Advertisement Internet Walk-ins Employment Environment Organisations 1 % 41,8 % 8,2 % 35,3 % 8,0 % 18,6 2 % 11,3 % 6,7 % 45,3 % 12,4 % 26,9 3 % 22,7 % 9,0 % 9,3 % 24,8 % 30,8 4 % 17,7 % 9,0 % 10,0 % 38,7 % 16,0 5 % 3,5 % 62,7 - % 15,3 % 7,1 According to the table in the first row advertisement is the most preferred method by 41,8%. In the second row, second preferred method is walk-ins with 45,3%. Third one is environment with 30,8% and the fourth one is employment organisations with 38,7%. The least preferred method is internet with 62,7%. So 62,7% of the participants think that internet is the last choice as a recruitment method. This means in small organisations 476

7 internet is used very low. But it is a pity for SMEs to continue their operation without internet. Also participants are asked about their current employees. They answered the question How did you employed your current personnel? Again from five recruitment methods they made their ratings. According to the answers below table is obtained. Method Lower than %10 %11-30 %31-50 %51-70 Over %70 Advertisement % 31,0 % 22,1 % 18,6 % 12,4 % 15,9 Walk-ins % 12,7 % 20,1 % 26,1 % 18,7 % 22,4 Environment % 17,8 % 23,3 % 21,7 % 18,6 % 18,6 Internet % 66,0 % 17,0 - % 9,4 % 7,5 Employment Organisations % 40,6 % 24,6 % 17,4 % 11,6 % 5,8 According to the table %22,4 of firms stated that over than %70 of personnel is obtained by walk-ins. Again we see that internet is the least used method. %66 of the firms state that they employed their personnel (lower than %10) with the internet. So it s clear that SMEs don t prefer internet as a recruitment tool. 4. CONCLUSION For the organizations the primary goal of recruitment process is to attract potential applicants who have the knowledge, skills, abilities and other attributes to meet the requirements of organizational roles. Thus, organizations are increasingly using the internet to advertise job openings and attract qualified candidates. The web-based advertisement often provide information about job vacancies; job descriptions; the organization s culture and its brand identitiy ; and the inducements (e.g., pay, fringe benefits, learning opportunities, promotion prospects) offered its employees. (Stone et al., 2006: 232) There are many advantages of online recruitment for organizations: low cost, shorter recruitment cycle time, reaches a wider range of applicants, better 477

8 quality of response, gives the company a more up-to-date image, opportunity to address specific labor market niches, attracts the passive job- seeker, provides global coverage at a constant basis. (Galanaki, 2002: 244) Especially large organizations use those advantages and include internet in their recruitment methods. But it is not the same for small firms. Unfortunately SMEs don t use internet effectively. In our research it is found that internet is the least preferred one among five recruitment methods. SMEs mostly prefer informal methods. Because they have more informal relationships inside and outside of the firm. They take care referrals of current employees or friends and relatives. Thus they find people who can adopt the organization easily and please being in a small organization. In fact internet is very beneficial for the SMEs. We know that one of the main problems of SMEs is unqualified personnel. In many surveys small business have reported that finding comptetent employees is one of their most important problems. (Inc., 1997; Deshpande and Golhar, 1994; Atkinson and Storey, 1994; McEvoy, 1984) Internet give facility to reach a large range of candidates with low costs. For recruitment, SMEs can use professional human resources web-sites to advertise job vacancies or they create their own web-sites and use it both for to introduce their firms and announce employee needs. Thus they can reach the potential candidates easily and recruitment and selection process will be effective. REFERENCES BİNGÖL, D., Personel Yönetimi ve Beşeri İlişkiler, Atatürk Üniversitesi Yayınları No: 676, Erzurum, 1990 BOLTON, T., Human Resource Management an Introduction, Blackwell Publishers, 2002 BAROUKH N. ve H. B. KLEİNER Recruitment and Training of Public Servants, Management Research News, Volume 25, Number 3, 29, TANOVA C. ve H. NADIRI, Recruitment And Training Policies And Practices The Case Of Turkey As An EU Candidate, Journal Of European Industrial Training, Volume 29, Number 9, , BOLTON, T., Human Resource Management an Introduction, Blackwell Publishers, 2002 PRICE A., Principles of Human Resource Management an Active Learning Approach, Blackwell Publishers, 2000 DAFT R. L., Management, Third Edition, The Dryden Pres,

9 BELL B. S., LEE S. W. ve S. K. YEUNG, The Impact Of E-Hr On Professional Competence In Hrm: Implications For The Development Of Hr Professionals, Human Resource Management, Vol. 45, No. 3, 2006, STROHMEIER S., Research In E-HRM: Review And Implications, Human Resource Management Review, 17, 19 37, 2007 TANOVA C., Firm Size and Recruitment: Staffing Practices in Small and Large Organisations in North Cyprus, Career Development International, Volume 8, Number 2, , JAMESON S. M., Recruitment And Training In Small Firms, Journal of European Industrial Training, Volume 24, Number 1, 43-49, CARROLL M., MARCHINGTON M., EARNSHAW J. ve S. TAYLOR Recruitment In Small Firms Processes, Methods And Problems, Employee Relations, Vol. 21 No. 3, , STEWART J. ve V. KNOWLES, Graduate Recruitment And Selection:Implications for HE, Graduates And Small Business Recruiters, Career Development International, Volume 5, Number 2, 65-80, MAURER S. D. ve Y. LIU, Developing Effective E-Recruiting Websites: Insights For Managers From Marketers, Kelley School of Business, Volume 50, , COBER R. T., BROWN D. J., KEEPING L.M. ve P. E. LEVY, Recruitment on The Net: Organizational Web Site Characterictics Influence Applicant Attraction, Journal of Management, Volume: 30, Issue: 5, 2004 STONE,D. L., STONE-ROMERO E. F. ve K. LUKASZEWSKI, Factors Affecting The Acceptance And Effectiveness Of Electronic Human Resource Systems, Human Resource Management Review, Volume 16, , GALANAKI E., The Decision to Recruit Online: A Descriptive Study, Career Development International, Volume 7, Number 4, , ( 479