Acquiring talent (AQA A Level Business): Revision Note

Workforce planning

• Workforce planning focuses on identifying how many and what kind of employees are needed in a business

  • It looks at how employees will be:

    • Recruited and deployed

    • Developed and trained

    • Motivated, managed and effectively led

Reasons for workforce planning

• Workforce planning helps make sure the business has the right number of people in the right jobs at the right time

Challenges of acquiring talent

Skills shortages

• In some sectors and specialist roles, there are simply not enough qualified candidates available in the labour market to meet demand

• Businesses are forced to compete for a limited pool of applicants

Example

In 2021, the UK experienced a severe shortage of HGV (heavy goods vehicle) drivers, leaving supermarket shelves partially empty and causing fuel station queues across the country

Years of under-investment in driver training, combined with the impact of Brexit reducing the pool of EU drivers working in the UK, meant there were simply not enough qualified candidates to fill available roles

Competition from other employers

• Businesses often compete directly with rivals for the same candidates, particularly in high-demand fields such as technology, healthcare and engineering

• Larger or better-known employers often have an advantage in attracting top talent

Example

The growth of artificial intelligence has created intense competition among technology companies for a small pool of AI researchers and engineers. Businesses such as Google, Meta, Microsoft and OpenAI are all recruiting from the same limited talent pool, pushing up salaries for experienced AI specialists to extraordinary levels — and making it difficult for smaller businesses to compete

Cost of recruitment

• Advertising vacancies, using recruitment agencies, conducting interviews and onboarding new staff all involve significant costs

  • Agency fees alone can reach 15 to 20% of a new employee's annual salary

Example

The National Health Service (NHS) spends over £3 billion annually on agency and temporary staff to fill vacant nursing and clinical roles

This is a direct consequence of the cost and difficulty of recruiting permanent employees quickly enough to meet demand

Source: https://www.gov.uk/government/news/nearly-1-billion-for-nhs-frontline-after-agency-spend-crackdown (opens in a new tab)

Time

• Recruitment processes can take weeks or months, leaving the business short-staffed and placing pressure on existing employees

Attracting diverse candidates

• Businesses committed to improving diversity and inclusion may find that their existing recruitment methods do not reach a wide range of candidates

Example

Goldman Sachs acknowledged that its graduate recruitment process was failing to attract many candidates from under-represented backgrounds, with applicants overwhelmingly coming from a small number of elite universities

The firm invested in outreach programmes at state schools and colleges, but recognised it would take years before its workforce reflected those efforts

Employer reputation

• Candidates usually research businesses before applying for a job

• A poor reputation as an employer, whether due to low pay, negative reviews on platforms such as Glassdoor or media coverage of poor working conditions, can significantly reduce the quality and volume of applications received

Example

Following P&O Ferries' decision in March 2022 to dismiss 800 workers without notice and replace them with cheaper agency staff, the company's reputation as an employer collapsed

Job applications fell sharply and the business faced significant difficulties attracting quality candidates

Geographic limitations

• Finding suitable candidates in specific locations can be difficult, particularly for businesses based in rural or remote areas or for roles that cannot be performed remotely

Example

HS2, the high-speed rail construction project, has faced challenges recruiting skilled engineers, tunnellers and construction workers in sites located away from major cities

In some areas, the local labour market simply does not contain enough workers with the required specialist skills, forcing the project to offer relocation packages and work with training providers to develop new workers in the regions concerned

The recruitment process

• Recruitment is the process of attracting and identifying potential job candidates who are suitable for a particular role

  • Recruitment activities include job advertising, job fairs, social media outreach and referrals from current employees

The value of effective recruitment

• Businesses that recruit effectively are more likely to have a skilled, motivated workforce capable of meeting their objectives

• Recruiting the wrong person can be costly

  • The business may need to re-advertise, re-interview and re-train, wasting time and money

• Effective recruitment reduces staff turnover

  • Employees who are well-matched to their roles are more likely to stay

• It supports succession planning by ensuring the business has the talent it needs for future growth, not just current operations

Impact on business performance

The cost of poor recruitment

• Financial cost

  • The average cost of replacing an employee in the UK is estimated at over £3,000, and significantly higher for senior roles

• Operational disruption

  • A vacancy or an underperforming new employee places additional pressure on existing staff

• Cultural impact

  • A poor hire in a leadership role can damage team morale and increase staff turnover

• Opportunity cost

  • Time spent managing a poor hire is time not spent on business development or other priorities

The recruitment and selection process

Define the role

• This involves determining exactly what is required in a job and of suitable candidates

  • A job specification outlines the qualifications, skills, experience and personal qualities required from a candidate for a specific job, e.g. problem-solving, good communication, able to code in Java

  • A job description outlines the duties, responsibilities and requirements of a particular job

Determine the best source of candidates

• This involves deciding whether to advertise the role internally, externally or using a combination of both

  • Internal recruitment is the process of hiring employees from within the organisation

    • Internal recruitment can be beneficial as it encourages employee development, builds morale and can save time and money on training

  • External recruitment is the process of hiring employees from outside the organisation

    • External recruitment can bring fresh ideas, experiences and perspectives to the organisation

Advertise

• Businesses with a strong social media presence can use platforms such as Facebook, LinkedIn or TikTok to advertise cost-effectively

• Adverts can be placed on specialist recruitment portals, such as the Times Educational Supplement (TES), one of the main publications used to recruit teachers

Receive applications

• This stage involves collecting information from potential candidates

• Someone within the business manages this application process

  • A shortlist of candidates from the many applications received is drawn up

    • The shortlist contains candidates whose applications closely match the job description and job specification

  • A selection of candidates on the shortlist are invited to interview or take part in the next round of selection activities

Internal and external recruitment

• Internal recruitment can involve the promotion or redeployment of staff to fill a vacant post

  • Vacancies are advertised internally on staff notice boards, in newsletters or via in-house electronic communications

Evaluating internal recruitment

• External recruitment can bring fresh ideas, experiences and perspectives to the organisation

  • However, it is often more expensive than internal recruitment

  • There is also a greater degree of uncertainty as external candidates are unknown to the business

Recruitment methods

• Recruiting the right employees is crucial for any business aiming to achieve its objectives effectively

• Recruitment methods include traditional newspaper advertisements to modern online platforms, as well as specialist recruitment agencies

Job advertisements

• Publishing job openings through newspapers, magazines or noticeboards

Employment agencies

• External firms specialising in recruiting staff for other businesses

Online recruitment

• Advertising job openings on the internet via company websites or recruitment platforms

The selection process

• The selection stage begins with collecting information from applicants

  • A business may have its own application form, which gathers information such as personal details, qualifications, and work experience

  • Applicants may alternatively be asked to submit their curriculum vitae (CV) and a covering letter

Application form

• Application forms contain a series of standardised questions to which all candidates must respond:

  • Name and contact details

  • Qualifications

  • Work experience

  • Positions of responsibility

  • Interests

  • A personal statement where the candidate explains why they would be suitable for the advertised role

  • The names and addresses of referees

• Application forms are often completed online

Curriculum vitae (CV)

• A curriculum vitae is compiled by the applicant and may be standardised to apply for varied roles

• CVs usually include similar information to that collected in an application form

• Although it should be well laid-out and clear, there is no single acceptable format for CVs

• An accompanying letter of application outlines

  • Why the applicant wants the job

  • Why they would be suitable for the advertised role

• Once received, applications are sifted to identify the most well-suited applicants for the role

  • A shortlist of preferred candidates is compiled

  • These candidates are invited to take part in the next stage of the selection process

Interviews

• Interviews are face-to-face meetings (in-person or virtual) where applicants are asked questions about their skills, experience and knowledge

• A set of relevant questions is used for all candidates to ensure that the interview is conducted in a fair and consistent manner

• Interview questions may focus on:

  • Skills and experiences relevant to the job

  • Successes and failures, and how these were overcome

  • Personal interests and experiences

Tests

• Assessment tests provide shortlisted candidates with the opportunity to demonstrate their integrity, suitability for the job, aptitude or specific skills

  • This can help a business gauge whether a candidate would be a good fit within the existing team

• The assessment tasks may include psychometric tests, group exercises, knowledge tests or presentations

• They typically assess problem-solving and critical thinking skills, giving employers an idea of a candidate's potential

References

• Job applicants are usually asked to provide the names of two referees who can vouch for their skills, work ethic and overall suitability for the position

• Referees should know candidates in a professional capacity and be able to speak positively about their abilities

• They are usually listed on the application form or CV and are typically contacted once a job offer has been made