The HRM and Employee
Retention Rate
INTERNAL RECRUITING
EFFORTS:
Promotion from within
concept – current employees are able to bid for jobs which are identified
through HRM systems or referral by fellow employees; .e.g. UPD, McDonalds use
these policies to develop candidates for promotion; 40% of the top 50
executives in McDonalds started out in restaurants. The
promote-from-within-where-ever-possible policy has these advantages:
– Promotes good public
relations
– Builds morale
– Encourages
individuals who are qualified and ambitious
– Improves the
probability of good selection, because information on the individual’s
performance is readily available
– Is less costly than
going outside to recruit
– Helps with
recruiting entry level workers
– Reduces orientation
and training costs
– When carefully
planned can also act as a training device for developing middle and to-level
managers
The Principal
Financial Group, one of Fortune magazine’s “100 Best Companies to Work
For,” gets at least 40% of new hires by employee referral. Wegmans, a
regional grocery chain that is also on the “Best” list, reports that
one in five of their employees are related to another Wegman’s employee. Many
of these organizations include a reward if an employee referral candidate is
hired for a position which is hard-to-fill. Referral bonuses a $10,000 or more
are not unusual in these fields. Employee referrals are an excellent means of
locating potential employees for hard-to-fill positions. Both organization and
employee benefit. Higher-level positions, however, are more likely to be
referred by professional acquaintance rather than a close friend.
Discuss: How does HRM
implement employee retention?
