Competing Through Sustainability:
Few Line Up for Jobs Abandoned by Immigrants
This vignette provides a glimpse into the ethical and legal issues surrounding hiring immigrant
workers and the sustainability of business models that are premised on the availability of cheap
labor. The scenario described in the vignette is the Alabama labor market which was devastated
by a State law preventing illegal immigrants from working. The dilemma comes from the fact
that many of the jobs these immigrant laborers were doing are things that native Alabamians
won’t do.
Discussion Questions
1. Is the inability to find traditional workers willing to perform the types of jobs described
here a sign that the business model in some of these industries has to change?
Answers may vary but the basic issue is in today’s world economy, companies have to
2. Why do the laws of supply and demand not seem to hold within these industries when it
comes to labor markets?
Labor market behavior in this situation does seem to defy the logic of supply and
Evidence-Based HR
The evidence seems to support the idea that when a company needs to replace their
leader, an internal recruit is the better choice. Internal recruits last longer in terms of
tenure and are ousted far less frequently than external recruits.
Exercise
Have students visit several different corporate websites. As a suggestion, have students
visit Fortune 500 websites:
Have students look for evidence of internal or external recruitment policies. Consider
having students look for trends in terms of industry policies for recruitment and see if
they can identify any patterns. For example, are there industries that tend to have more
internal recruitment? Does the nature of or type of industry matter? Have students
discuss.
2. Direct Applicants and Referrals
a. Direct applicants are people who apply for a vacancy without
prompting from an organization.
b. Referrals are people who are prompted to apply for a vacancy by
someone within the organization.
c. Direct applicants may have already investigated the organization
and are sold, which creates a self-selection that is easier for the
organization. Direct applicants tend to be one of the best sources,
since they are also low cost.
Integrity in Action:
Anti-Poaching Agreements Spark Anti-Trust Lawsuits
Some organizations attempt to “poach” competitor’s employees to hire rather than finding
applicants who are not already employed. A group of high-tech firms had an unofficial
agreement that they would refrain from poaching each other’s employees, which resulted in an
anti-trust claim. The lawsuit was dismissed, but raises the question of the legality and ethics of
such agreements and the practice of poaching itself.
Discussion Question
Why is having one’s best employees “poached” by a competitor such a devastating event and
what steps can employers take to prevent the loss of their top talent other than engaging in secret
collusions that may violate anti-trust laws?
The issues here are the potential losses of proprietary information and organizational learning,
3. Advertisements in newspapers and periodicals – typically are less effective
4. Electronic Recruiting – The growth of the information highway as opened
up new vistas for organizations trying to recruit talent. Ways to get into
“e-recruiting include:
Competing Through Technology
Unlocking the Secrets of Applicant Tracking Systems
Organizations today are receiving more applications than ever before. Part of the reason for this
is the ease at which an applicant can apply for a job using social media and the Internet. The
case describes several key pointers for job applicants using these features to apply for jobs. It is
important for applicants to recognize that if their choice of words on their resume does not match
the terms described in the online job posting, many applicant tracking programs will not
recognize their resume as a match (for example, if the posting asks for someone who is
innovative, saying you are “creative” will likely not show up as a match).
Discussion Question
How useful do you feel an applicant tracking system is in procuring the best applicant for a given
job? What are the potential benefits to these systems to the organization? To the applicant?
Student responses may vary in response to these issues, but many younger people today view
5. Public and Private Employment Agencies—Agencies will search their
computerized inventory of individuals searching for work for an
organization at no charge.
a. Public employment agencies serve primarily the blue-collar labor
market.
c. Executive search firms are often referred to as “head hunters”
because they recruit executives who tend to be employed. A high
6. Colleges and universities may be an important source for entry level
professionals. To increase effectiveness, organizations employ internship
7. Evaluating the quality of recruiting sources can be done by compiling
yield ratios that express the percentage of applicants who successfully
C. Recruiters—The recruiter comes late in the process, at which point an applicant
has a good idea whether he or she is interested in the job. Since recruiters are
perceived by the applicant to be “selling” the job, their input may be discounted.
Recruiters may have more impact depending on a number of factors .
1. The Recruiter’s Functional Area—The recruiter is likely to be perceived as
more credible if he or she is from the same functional area the recruit is
being considered for.
2. The Recruiter’s Traits—Critical traits appear to be warmth and
“informativeness.”
3. The Recruiter’s Realism—Deceiving candidates about the negative
elements of a job may increase later turnover; however, telling candidates
about negative elements does not appear to inoculate them against
disappointment nor make negative elements go away. Personnel policies
that affect the job’s attributes are likely to be more critical than recruiter
realism.
4. Enhancing Recruiter Impact—Recruiters can provide timely feedback about
the status of the job search, avoid unfavorable behaviors that send poor
messages about the organization, focus on inexperienced applicants with
whom they might be more influential, and avoid mixing recruitment with
selection. Recruiting should be done in teams, including a person from the
functional area and members who are female and minority.
A Look Back
We opened this chapter with a story of how different companies in different industries
all competed for the same valued resource: technical talent. Each organization was
seeking some competitive edge that would result in their securing the most talented
individuals, and each company had a different strategy depending on the company’s
size, its social reputation, and the nature of the work itself.
1 Questions
1. Discuss the advantages and disadvantages of hiring local workers versus offshoring
versus bringing in immigrant labor? How does the nature of the product market affect
what you might do in the labor market?
Students should recognize the strengths and weaknesses with each choice.. The benefits
of local workers are contributions to the economy, highly-skilled and talented workers,
etc. Drawback could be the demands for higher wages by local workers. Offshoring
2. Assume you were a large and well established company that was now facing a labor
surplus in some job category. Why might it be in your best interest to use some method
other than layoffs to reduce this surplus, and in what sense are your options here a
function of how well you did in terms of forecasting labor demand and supply?
Student answers will vary. If a large and well established company is facing a labor
surplus in a particular job category, it might consider cross training the employees in that
2
3. Discuss the advantages and disadvantages of promoting workers from within your own
firm versus going outside the firm to bring in external hires. How does the nature of the
business situation affect this decision?
Student answers will vary, but they should identify the fact that promotion from within
3
4
5 Chapter Vocabulary
These terms are defined in the “Extended Chapter Outline” section.
Forecasting
Leading indicator
Transitional matrix
Downsizing
Outsourcing
Offshoring
Workforce utilization review
Human resource recruitment
Employment-at-will-policies
Due process policies
Direct applicants
Referrals
6 Discussion Questions
1. Discuss the effects that an impending labor shortage might have on the following three
sub-functions of human resource management: selection and placement, training and
career development, and compensation and benefits. Which sub-function might be most
heavily impacted? In what ways might these groups develop joint, cooperative programs
to avert a labor shortage?
Labor shortages may have the following effects on:
Selection and placement—There will be increased pressure on this function to recruit
Training and career development—Training will also be pressured to design a training
Compensation and benefits —There will be pressure to hire the employees who are at a
These pressures will strain the system, and a decision will have to be made regarding the
cost/benefit of strategies to deal with the problem. For example, a solution may involve a
short-term recruiting strategy that would offer higher salaries than the organization would
2. Discuss the costs and benefits associated with statistical versus judgmental forecasts for
labor demand and labor supply. Under what conditions might either of these techniques
be infeasible? Under what conditions might both are feasible but one more desirable than
the other?
Certainly, judgment by experts may be intuitively appealing since it appears faster and
less expensive than compiling and analyzing statistics. There may not be employees
Both these techniques might be infeasible to use when the environment is so unstable that
neither past experience nor expert judgment will provide a reliable base of information.
Both may be feasible when there is some instability in the environment. Statistical
3. Some companies have detailed affirmative action plans, complete with goals and
timetables, for women and minorities and yet have no formal human resource plan for the
organization as a whole. Why might this be the case? If you were a human resource
specialist interviewing with this company for an open position, what would this practice
imply for the role of the human resource manager in that company?
Organizations may have derailed affirmative action plans because they must. They might
be government contractors or they could be under a court-ordered decree that forces them
to have such a plan. There are no legal requirements for human resource planning and,
4. Recruiting people for jobs that entail international assignments is becoming increasingly
important for many companies. Where might one go to look for individuals interested in
these types of assignments? How might recruiting practices aimed at these individuals
differ from those one might apply to the “average” recruit?
Some colleges and universities have majors in international trade or business. Students
often have a double major in a foreign language and business. They are more likely to be
interested in going abroad. People who have language skills other than English might
also be a possibility, particularly if they have lived in other countries. Placing job
5. Discuss the relative merits of internal versus external recruitment. What types of
business strategies might best are supported by recruiting externally, and what types
might call for internal recruitment? What factors might lead a firm to decide to switch
from internal to external recruitment and vice versa?
Merits of internal recruitment are that the organization will be more familiar with the
Candidates may he recently educated/trained and therefore have
up-to-dare skills and knowledge.
Strategies related to high levels of competition would be best supported by internal