Pearl and Mutual Benefit Insurance Company (PMIC) has been experiencing a high turnover of graduate trainees. For the last five years, the company has invested in 15 to 20 graduate trainees each year. The turnover is approximately 60% of the recruits. The current report investigated the reasons for such a high rate of turnover. It was found that the recruitment model, which used the General Mental Ability, was faulty. The senior managers were manipulating the process. The current report is a search for an alternative model. The Personality and Emotional Intelligence model was recommended for the PMBICI recruitment process. The model will help the company select the graduate trainees suitable for the firm and who can be retained.
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Introduction and Background Information
Over the past five years, Pearl and Mutual Benefit Insurance Company (PMIC) has recruited between 15 and 20 graduate trainees per year. However, retention analyses indicate that 60% of the recruits have left the organization for careers in different industries that are not related to the financial service sector. The trend is worrying considering the investment made by PMIC to develop each of these graduate trainees.
The organization’s selection method adopts the General Mental Ability as the initial screening instrument. After the screening, the candidates are interviewed by senior line managers trained on the competency framework interview process. The process is designed to rate and elicit six behavioral competencies. The skills include those related to selling, drive to achieve and interpersonal relationship. The process is rated as effective.
However, it allows the senior managers to impose their conclusions on the final decisions regarding the suitability of the applicants. The result is the recruitment of individuals that may not fit in the organization, leading to a high rate of turnover. It is recommended that PMIC should find an alternative graduate recruitment method to net the right graduate trainees that can work and be retained in the organization.
General Mental Ability
General Mental Ability represents individuals’ capacity to learn, solve problems, and demonstrate reasoning skills (Samson & Daft 2012). The psychometric assessment tools used in this model include scales that involve measures of verbal, spatial, and mathematical constructs. According to Muchinsky (2011), GMA is an effective indicator of job performance. However, senior managers can manipulate the assessment and impose their conclusions on the final selection decisions. Pearl and Mutual are advised to consider an alternative recruitment process.
Recruitment and Selection Overview
Many organizations have recognized the significance of managing their human resources more effectively. The strategic management of the human resource is all about adaption and integration. Recruitment and selection determine how a business perceives its human resource requirements with regards to its competitive advantage (Samson & Daft 2012). The recruitment process involves sourcing for potential employees and interviewing them. The selection process, on the other hand, involves staffing and training the recruits into their job roles (Samson and Daft 2012).
The adoption of best practices in human resource management helps an organization to meet its goals and objectives. It is important to analyze the strengths and weaknesses of the recruitment process. The company should also carry out an analysis of its human resource requirements. Thirdly, the firm should also evaluate the sources of the candidates. The above are significant factors that should be taken into consideration in the planning stages of recruitment and selection. When a recruitment program is well planned, it attracts more candidates. Consequently, the company has more choices.
There are four major stages in recruitment and selection:
The process starts with the definition of the organization’s human resource requirements. It involves the preparation of job descriptions and specifications. The terms and conditions of the job should be made clear and specific. The definition of the organization’s human resource requirements is based on the job description (Podsakoff et al. 2011). A job description is the detailed specification of the requirements that inform the compilation of an internal announcement for specific recruitment. The definition of requirements may also include such decisions as to whether the job is permanent or not.
The second stage involves reviewing the alternative sources for candidates. The sources can be inside or outside the company. It involves advertising and using consultants and recruitment agencies. The information given in the advertisement should allow potential candidates to decide on their suitability for the job (Nikolaou & Oostrom 2015).
Selection involves sifting through the applications. It also entails testing, interviewing, and assessing the candidates. Successful candidates sign the employment contracts at this stage (Nikolaou & Oostrom 2015).
Once the candidates are identified and the employment contracts are signed, the employees are then introduced to the organization (Nikolaou & Oostrom 2015). The candidates are also introduced to the terms of employment.
Graduate Recruitment Programs
High-potential management programs
In this approach, the organization may target a small sample of highly qualified candidates with opportunities to fast-track their career progression. Such candidates expect to be included in strategic decision-making processes after a short stint in the organization (Nikolaou & Oostrom 2015).
The strategy is useful to organizations that may not have defined the roles the recruited graduates are to perform. As such, the graduates are expected to work in each department for a few months. The program allows the employer to evaluate the roles that best fit the skills of the graduate (Gilmore & Williams 2012).
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Hold on to the graduate recruits
After the recruitment, the company is most likely to invest in the new employees’ time and resources to develop a skilled team. As such, the management should avoid losing the employees to other institutions. There are a few things that the company can do to retain graduate employees. It is essential to implement the set checkpoints for the graduates’ salary progression, give regular feedback, and gradually increase their responsibilities (Gilmore & Williams 2012).
Employment Selection: Personality Tests
General Mental Ability is one of the most suitable selection methods. Many employers are using the model to recruit and select employees. The personality test seeks to identify individuals possessing the skills and knowledge needed to succeed in the job (Banks & McDaniel 2014). The reason why Pearl & Mutual may be having a high graduate trainee turnover may personality mismatch between the employees and the positions they are assigned to. As such, it is recommended that the company should adopt the Personality Test in the selection process.
Like the General Mental Ability, Personality Test is a product of psychology (Richardson & Norgate 2015). Psychology can help to assess the personality and emotional intelligence of employees. Personality refers to each individual’s behavioral traits, which are constant. On its part, emotional intelligence is the ability to express emotion, as well as understand and regulate emotions. By utilizing a scientific approach in the recruitment of graduate trainees, Pearl & Mutual can hire and retain successful employees.
Theory and Practice: Personality and Emotional Intelligence
The association between personality and emotional intelligence and an employee’s performance is compelling. The cognitive measurement instruments are successful predictors of performance. However, the tools do not measure human personality, which determines the success of employees (Banks & McDaniel 2014). Personality is the total of an individual’s reaction and interaction with other people. The behaviors are measurable traits exhibited by an individual. One of the popular models using in measuring personality is the Big Five Model. The model is made up of five dimensions used to capture the variations that abound in human personality (Ashton 2013).
There are a few tests used in the selection process about the Big Five theory of recruitment and selection. They include the NEO-Personality Inventory. The test comprises of 150 questions that test extraversion, conscientiousness, and other variables (Ashton 2013). The second is the Personality Characteristics Inventory (PCI). There is also the Hogan Personality Inventory (Thomas & Scroggins 2006). The test focuses on normal personality traits.
Emotional intelligence is not a trait. However, its tests are viewed as reliable even though their measure is limited to abstract reasoning and verbal fluency. The emotional intelligence test comprises of several elements. The first component suggests that individuals should have the ability to perceive emotions within themselves and in others (Kaplan & Saccuzzo 2017).
The individual should also be able to express their emotions. Secondly, the subject should be aware that their emotions shape their thoughts and coping mechanisms. Thirdly, individuals should be able to understand and analyze their emotions. Fourthly, it is important to regulate emotions and chose positive ones to improve communication. It should be understood that it is not possible to change emotional intelligence (Banks & McDaniel 2014). It remains constant throughout one’s life. To this end, it is recommended that Pearl & Mutual should adopt the Personality and Emotional Intelligence Tests as a replacement of the current General Mental Ability.
Pros and Cons of the Personality and Emotional Intelligence Test
The approach is an effective indicator of job success. Consequently, it helps in the retain-ability of Pearl & Mutual’s student trainees. The success factors are dependent on its ability to identify the characteristic behavior of individual graduate recruits (Ashton 2013). Compared to the General Mental Ability, the test offers a wider and more inclusive method of measurement. However, some people believe that personality tests are invalid and can be faked. The strength of the measurement lies in the structure of the questions raised by the reviewers. To find the right graduate trainee assessment tests, this report recommends the Personality and Emotional Intelligence tests.
Google, Apple Inc., and McDonald’s are forgoing traditional recruitment methods in favor of personality and emotional intelligence models. They aim to avoid recruiting the wrong people (Cote 2014). The companies are using personality and emotional intelligence as measures of performance because the approaches involve self-awareness, motivation, self-regulation, empathy, and social skills (Drasgow 2012). The individuals with such skills are viewed as good performers who can work in teams.
Conclusion and Recommendations
The General Mental Ability assessment test has been used by Pearl & Mutual for a long time. The approach is ineffective and senior managers have abused it, leading to the excessive turnover among graduate trainees. It is recommended that the organization should adopt Personality and Emotional Intelligence tests as alternatives to the GMA. The effectiveness of these models is validated by blue-chip companies, such as Google and Apple, who rely on these tests to recruit and select employees. The revised Graduate Selection Process will take five months to implement. The process will cost Pearl & Mutual $15,000.
Personal Reflection on the Learning and Experience of the Module
The analysis of the recruitment and selection process at Pearl & Mutual was an interesting exercise. It was undertaken under the instructions of the human resource manager after it was discovered that the results from the GMA tests and interviews were being influenced by the opinions of senior managers. As a consequence, the company had invested in graduate trainees who left for other firms. The interesting finding was that the graduate trainees did not go to work for financial institutions like Pearl & Mutual.
The finding was intriguing because the training they received entailed exposure to finance. It can be deduced that the recruitment and selection process was flawed. The company was recruiting graduate trainees who did not fit in a financial institution. As such, it was necessary to remedy the situation by changing the recruitment approach. I was assigned the task of reviewing the mode of selection and compiling a report with recommendations regarding alternative methods.
I believed that the GMA approach, which is still used by many organizations as the initial sifting process, was the best approach to recruitment. However, it turned out that there are other methods used by some of the most successful companies, such as Google and Apple Inc. To this end, the search for an alternative model involved the perusal of books and periodicals. It also involved personal visits and interviews with other human resource practitioners.
I discovered that many successful organizations have moved from GMA to personality and emotional intelligence as indicators of employees who can perform and be retained within the firm. I had heard about the personality model, but I had not anticipated how widely it was used in the industry. According to the literature that was perused, the evaluation of an individual’s personality can reveal a lot about the candidate, especially on how they relate with other people in a group setting.
Emotional intelligence buttresses the personality attributes of the employee. It achieves this by offering the emotional stability that an employee requires to operate in demanding working conditions. Pearl & Mutual could benefit by overhauling the current recruitment process and adopting the Personality and Emotional intelligence model. My report recommends that the organization should consider adopting this model. Its adoption is not expensive and can be done within six months. The period is adequate and can accommodate the training of the managers with regards to administering the tests.
I found the exercise an interesting learning process. I have gained a lot of insight into how to conduct graduate trainee recruitment. I have also learned that not all highly qualified graduate trainees are interested in working for one company. Many have ambitions that drive them from one organization to another as they pursue their dream career. I hope that the proposed model will help Pearl & Mutual to recruit the right graduate trainees and retain them. I intend to be part of the recruitment process and help in implementing the new human resource policies at Pearl & Mutual.
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