The Pestle Analysis Diagram Information Technology Essay

When ever a new strategy enters the business market it is necessary to understand the factors influencing the new strategy and the steps to be taken care of by the companies while implementing the new strategy. An analysis which gives such factors is STEEPLED analysis. PESTLE is the analysis commonly used by the researchers which then extended to ethics and demographics and named as STEEPLED analysis. PESTLE stands for political, economic, social, technological, legal and environmental analysis. It is also known as PEST, STEEP, STEP, PESTEL, LEPEST analysis (PEST analysis, 2010).

Pestle Analysis Diagram

This report deals with the technological and social factors of E-Recruitment. The purpose of choosing these factors is that the main development in the recruitment system is use of internet (online) i.e. technology and there exists some external social factors which influence the use of new technology.

2.1 Social factors of E-Recruitment:

The social factors influencing the practice of new technology are:

The growing use of internet: 52 million use internet now a days in India and is expected to grow in future too. Such growth and interest among the users has made the new technology exist in the recruitment system (Subho Ray, 2010). Internet has become a place where a person can access any information anytime and at anyplace with low cost, with the use of internet a person can search for jobs anytime sitting at any place, such comfort has made the growth in use of new technology.

Changing demographics: There is a gradual increase in the resume growth every year and percentage of usage of portals. People have started using internet for various purposes including job search (IAMAI, 2010). With the changing regulations for equal opportunities to all people like women, disabled, backward castes, search for jobs has increased to large extent. The technology hides the diversity while applying for jobs in job sites. This also forms an implementation challenge for the companies implementing the new technology.

Business reasons for using a jobsite: Companies are finding it easy to post a job online and receive thousands of resumes with in less time. They could reach wider crowd with the help of this technology. Time and cost factors are one of the reasons for using jobsites for recruitment purposes by the companies (Robert, 2010).

The Growth of Part-Time and Flexible Working: The trend followed now-a-days are part-time and contract jobs rather than permanent jobs. Frequent job search for such jobs have influenced to practice the new technology (E-Recruitment solutions, Anon).

Increase in the job search by passive candidates: online recruitment is mainly used by passive candidates who work in a company and apply for jobs, when struck with a good opportunity would like to shift to another job (Robert, 2010).

Outsourcing: The practice of outsourcing is very popular now-a-days. Many of the multinational companies outsource their work outside the organization which has increased the need for workforce. They require many personals to work on a particular project and the new technology made it easy for them to acquire personals with no geographical limitations (Prasad, 2010).

2.2 Technological factors of E-Recruitment:

Internet plays an important role in the developments to the recruitment system, before the internet has been used for recruiting purposes, job seekers and employers preferred traditional ways to recruitment which involved much of paper work. Paper adverts was the main source for adverting and attracting candidates but the trend has changed to internet which is being used along with paper adverts.

With the implementation of new features and trends stated below it can be said that E- Recruitment is more cost effective and saves more time than traditional recruitment. E-Recruitment is not a part of few companies now-a-days but ‘is becoming a part of corporate strategy’ for many companies. The main cause for the wide usage of E-Recruitment process is the ease of use to give your message to more candidates in a faster pace. From the article published by recruitment training on the internet gives that “E-Recruitment, though at nascent stage, is becoming a part of corporate strategy with increasing numbers of companies setting aside budgets for online recruitment. E-Recruitment practices — using the Internet to find candidates for job openings — have established some roots in the business world, but are far from refined. However, the primary benefit is clear and convincing: You can get your message out to more candidates, faster.” (Tandon, 2006)

2.2.1 Features of E-Recruitment

Most On-line recruiting (E-Recruitment) sites have ‘easy-to-use search capabilities, customer service and convenience’.

The common features include:

One of the impressive feature is to select the best talented from thousands of resumes posted online by the professionals which has been made easy today

Questionnaires are tailored accordingly to detect required skills to meet the exact needs of the position.

Application process is been simplified which attracts many applicants

2.2.2 Changing trends of E-Recruitment

The changing trends in the E-Recruitment process are:

The first wave of Internet recruitment (E-Recruitment) is posting vacancies on the net in the same way as advertising them in a newspaper which did not improve the process of selecting the right person for the job. Other than advertising the rest of the process is done manually that is scanning the resumes, screening tests, interviews are done by the HR of the company (Online recruitment examined, 2009).

After internet has become the main stream for advertising the trend has changed to various sources of advertising. Initially, advertising was done through job portals and consultancies but gradually many companies have started using cooperate website for advertising (Brice & Waung, 2002).

With the increase in resumes the trend has moved to automated application tracking. Here the applications are screened using keywords and matched resumes for a particular job requirement are sent for further selection tests. Such type of method is commonly used by job portals which receive loads of applications for a job posting (Brice &Waung, 2002).

Though the recruiters have started using automated tools for screening the applications it was not useful to assess the skills of IT professionals in such cases skill assessment solution of IT professionals has cut down cost and time. Such type of software’s help initial screening of IT professional with effective and efficient technical and aptitude tests online who then can be called upon for further interview(Online recruitment examined, 2009).

Internet has also introduced a trend of automated application sifting. Most of the practitioners think that face-to-face interviews can be complemented by online technical tests and the results can be used to generate questions for the live interview (Online recruitment examined, 2009).

All the phases of the staffing process that is recruiting, selecting, screening, offering and closing and on-boarding are being automated with the help of e-interviews, online sifting, online personality test and so on (Kerrin and Kettley,2003).

A quick look at the overall trends in online recruiting shows that

Marketing the website in order to reach many people is important.

Professionalism in recruiting online that is emergence of professional internet recruiters.

Video interviews and online training for selection and post selection process. (India web developers.2010)

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The changing trend from recruitment process to E-Recruitment process is due to technology. The new technology is being implemented from the start to the end of the recruitment process that is from selecting the applicants from external sources till appointing the appropriate candidate for the job. The technological factors influencing the practice of E-Recruitment process are:

2.2.3 External sources:

The increase in the use of internet has made the sources of recruitment from paper work to online. Moving from the traditional way of applying for jobs, the sources widely used with the help of technology are (Bernardin, 2004):

The corporate website: these are the sites maintained by the organizations, here job vacancies are posted upon requirement and anyone can access the website to look for vacancy and apply for jobs. As such sites acquire little number of resumes compared to private jobsites, screening of the resumes are done manually by many organizations.

General employment websites: job portals like monster.com, hotjobs.com receive large number of resumes from the job seekers online. Any person interested to search for job can logon to these sites, register them and can post their resumes to the relevant job vacancies posted by the employers. These sites even facilitate employers to post job vacancies which can be viewed by the job seekers. There are many special job sites specializing in particular areas such as directemployers.com- it is a search engine developed by group of organizations where the job seeker can deal directly with the company.

Niche sites- these are the websites that cater to a specific profession. For example: site for senior finance executives, online recruiting service for senior and general managers and so on.

Online job fairs: the online job fairs are conducted by 25 or more companies where logo of each companies on the website takes the job seeker to the page with the information about the company and list of job vacancies in that company.

Hourly workers’ job sites: these are the sites which gives the job vacancies for hourly workers. Carrerbuilder.com is one of the site enabling skilled and hourly workers to apply for hourly jobs by indicating their work preferences, education, and experience (Anon, 2002)

Resume management systems: These websites are open to any users who can access internet and such ease of use has made the websites with resumes in bulk for a single job vacancy. With such large number of resumes, one cannot screen them manually so the technology has provided them with automated tool through which one can screen and filter the resumes within no time.

Resume management systems scan resumes into databases, and rank them from the most suitable resume matching the requirements to the least matching resume. Here the resumes are screened with the help of keywords. “Keywords refer to those words or phrases that are used to search databases for resumes that match”. When a job vacancy is posted by the employer, keywords are set into the software which scans the resumes and appropriate resumes are selected for interviews (Bernardin, 2004). With the help of such technology one can save human efforts, cost, and time and this whole process can take less than a day to complete which is very less compared to the traditional way of scanning the resumes.

Apart from the use of job portals and sources of recruitment, the technology have also been implemented for selection, assessment and testing within the organization.

To know about the technological factors of E-Recruitment system with in the organization dealing initially with the traditional way of recruitment can help us with better understanding of the technical changes.

Traditional way to recruiting:

Initially, when the HR executive gets the authorization to hire someone, the job specifications or description is distributed among the sources like news paper adverts, campuses, magazines, consultancies. When the criterion of the job seeker matches the requirement, job seekers or consultancies contact the company for the selection tests. Selection tests are conducted at the specified venue and the person qualified in the selection tests are invited for the personal interviews by the HR personals. The whole process of recruiting involves more cost, labor and takes days or even months to fill a vacancy (Bernardin, 2004).

Added technology to the traditional way to recruiting:

The new technology has added more efficiency to the recruiting system in terms of cost, time and space. Many of the organizations are now evaluating the labor costs and human resources in terms of available technologies, based on the theory- that the process can be accomplished efficiently and effectively with the combination of people, software, and equipment. An example given by Bernardin (2004) is- bank of America implements the combination of people, software, and equipment for better customer service. Instead of speaking to a customer representative to discuss the queries or account information, customer can interact with an automated teller machine (ATM). This machine is designed in such a way that maximum of the problems can be dealt with this software. With the use of such technology the Bank of America could reduce the labor costs. Customer also gains from using such technology as they pay less for service charges and get more interest on their money (Bernardin, 2004).

I: Selection, assessment, and testing online:

The new technology for selection and assessment is not a new concept but in fact computer based testing, telephone interviews are used from decades. From the work of Kerrin and Kettley (2003) the options for selection and assessment online are as follows:

Kerrin and Kettley refers to the work of Bywater (2002) who gave possible options for selection and assessment online through a figure stated below:

Pre-application

Online sifting

Online reasoning testes

Online personality questionnaire

E-interview etc

E-basket

Realistic job preview

Bespoke

Off the self

Are they worth bringing to assessment centre?

Will they fit the job/team/ context at a detailed level?

How will they handle multi-tasking in a managerial setting?

Do I really want to apply?

Will they fit the job, overall?

Are they qualified?

II: Pre application self-assessment:

The two main reasons for using pre-application self-assessment by the organizations are firstly, in order to increase the likelihood of a better ‘organizational culture fit’ and secondly, to decrease the applications, based on the candidates ‘knowledgeable self-selection out of the system’. Here through this technology, candidates can assess their skills and eligibility to the job by the feedback given online after the test. The feedback can be automated based on the scores the candidate obtain from the test and can be given to the candidate immediately after the test. This type of assessment doesn’t come under the selection criteria but is done before by the candidate to know how well he/she can perform in the job by the feedback.

The drawback of this approach is that it is not possible to know as what type of candidates are applying for jobs and dropout from the initial selection criteria due to various other reasons like improper environmental conditions during the test period, no proper internet service and so. With this approach it is possible to lose eligible candidates for the job.

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III: Online sifting:

Many of the companies attach application forms along with the job requirements in such approach screening and sifting online can allow the collection of information that is relevant to the job, rather than ‘padding’ which is found in CV applications. Through this technology, the process can be automated and sifting of thousands of applications can be done based on pre-defined criteria. The organizations should be careful while choosing the phrases or words for screening because wrong choice of the words can lead to selection of inappropriate candidates. Bartram (2000) states the best approach to sifting and selection online “are those that measure core competencies, are consistent, and job relevant and easy to score”. Here the design of the application form becomes important which should be designed in such a way that it can provide best quality information from the candidate applying for job. This is the area where the organizations are investing for research.

IV: Online testing:

Psychometric testing online is one of the types used for testing online. Along with the sifting criteria, the use of psychometric testing online has created uncertainty among the HR executives because of the security issues pondering from the practice. In such type of testing, the candidate is given a username and password for authentication and is provided with questions to be completed within specified time. The questions are taken from question banks and are random to all the candidates so there is no point that the same questions are repeated. Other than this there are many issues raised with the use of technology. One of the major issues is security- like how could one know that the test is secure? How could one know that they have got someone else to complete the test for them? And finally the organization has no chance to know the reaction of the candidate in appearing for the test- less human interaction. This technology could automate the test but still needs to improve to reduce the security treats.

V: Interviews and simulated assessments:

Interviews and simulated assessments can be done online with the help of the technology. For example: E-baskets and E-interviews. Assessment traditionally was done by inviting the candidate to the company and conducting face to face interview. The similar is possible with the help of technology. E-interviews can be conducted by the employers sitting at their office and the candidate at their place provided both of them have cameras for authorization and reduce the security issues. Such type of technology can save time, cost, and efforts by employers and as well as job seekers.

Bernardin (2004) gives the scenario existing in some companies with the technological factors of E-Recruitment as- “a manager or supervisor gets authorization to hire someone. The manager goes into a “node” on the internet and completes standardized job description for the new position; this establishes critical information regarding the job, including the necessary knowledge, ability, skills, and other critical characteristics”. With the help of job description, keyword computer search is done to find the applications appropriate for the job vacancy. The selected candidates are then sent the job description through e-mail. The manager then selects “short list” of candidates who could compete for job.

The information from the job analysis can also be used to retrieve questions for test automatically. The manager can even conduct online interview with the help of video computer. The whole process takes less than a day to conduct and select candidates for the vacancy.

2.3 E-Recruitment scenario in India:

Technology development in developing countries like India is relatively slow when compared to developed countries. Similarly online- recruitment took ten years to reach India (in 2010) though it was started in 1995 in the US. From the work of Srinivas (2001) gives that by 2001 from the 40 companies started in 2000 around 10 job portals were active and existing. According to him no job portal was profitable in India in 2001.

There is proportional growth of Indian job seekers with the rise of India’s Internet population. The online job seekers have increased from 71% to 6.5 million in 2005-2006 from 3.8 million in 2004-2005, according to a survey conducted by Internet and Mobile Association of India (IAMAI) published on 23rd June 2006 on internet. The Internet Population in India is at 38.5million and is all set to grow to 52 million now according to their new research published in 2010 (IAMAI.2010).

From the article published by IAMAI states that as the growth of the internet population becomes more and more like the main stream the jobs people search across multiple sectors and categories also increases. “On an average, Indians hold an estimated five jobs in their lifetime as compared to the western norm of 11. The number of job seekers online is further expected to cross 9.2 million in this year 2009-10 with the estimated market size of Indian e-recruitment industry to reach Rs241 Crores for 2010-11 from the current Rs 145.

The industry is also likely to maintain a year on year growth in excess of 60 %”( IAMAI.2010). Online Job search is predicted as one of the top five online activities (e-mail, surfing, chatting, search and job search) that Indians involve in on the internet. With the increase in the internet usage with 52 million users, E-Recruitment is gaining importance as preferred medium of hiring in India. For job seekers, the internet has opened up the world of job searching irrespective of space and time, turning it into a 24-hour-a-day market place (IAMAI.2010).

“The Online job search is a winner all the way. For job-seekers it eliminates the disadvantages of location, cost and time. For recruiters, it provides easy access to the best talent at competitive cost. Given the obvious advantages, this segment is set to grow at scorching place.” are the comments made by Dr.Subho Ray (2010).

2.3.1 Factors affecting the use of E-Recruitment in India:

The IES report 402 given by Kerrin & Kettley (2003) reveals that Fifty-five per cent of respondents expected their organization to reduce its use of other recruitment methods in the future. The key limiting factors to E-Recruitment most frequently reported were:

the cultural approach of the organization towards recruitment process that is traditional recruitment process done manually

the lack of knowledge of E-Recruitment within the HR community and hiring managers

Less internet usage by the users.

Confidentiality is a problem (Adam,2002)

“Online recruitment is dependent on computer literacy and internet penetration”. Today these portals are known amongst those having email accounts says Muralidharan (2006) which is one of the major problems in India today. Muralidharan (2006) refers to the work of Michael M Bala which stated that online recruitment deals with large volumes of applications, with many choices and so it is difficult to have necessary tools to identify the right kind of candidates. Also, a better understanding of what the candidate intends to communicate is needed which cannot be done electronically which easily describes that the E-Recruitment process lacks the property as stated above.

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2.4 Demographics:

The demographics given by IAMAI (2010) which gives the highlights of the online job seekers as well as parallel activities they do online are:

Age:

38% of the respondents who use the internet for job searches are in the 18-25 age group

43% are in the 26-35 age group

13% are in the 36-45 age group and

5% are in the 46-60 age groups.

Gender:

72% of the respondents who use the internet for job searches are male and 28% are female

Educational Qualification:

2% of respondents who use the internet for job searches have an education up to SSC / HSC.

12% have some college (including. diploma) but not a graduate.

41% have a graduate / post-graduate general (BA, BSC. MSC, B.com etc.)

40% have a graduate / post graduate professional degree.

Occupation:

13% of respondents who use the internet for job search are students

4% are clerical / salespersons

8% are officers and supervisors

15% are junior executives

25% are mid level executives

12% are senior executives

8% are self employed professionals

2% are businessmen / industrialists

2% are skilled / unskilled

2% are housewives

1% is retired.

Internet access:

48% of respondents use the internet for job searches access net from home 64% access the internet from offices

48% access the internet from cyber café

6% use it from a friend’s place

9% access the net from mobile handsets.

Internet usage in years:

37% of online job searchers have used the internet for over 6 years

48% for three – to five years

10% for 1 to 2 years

3% for 6 to 11 months

1% for less than 6 months.

Geographical Representation:

By state:

26% from Maharashtra

17% from Delhi

13% from Tamil Nadu

8% from Karnataka

6% from West Bengal

5% from Uttar Pradesh

4% from Andhra Pradesh

3% from Gujarat and Madhya Pradesh

2% from Bihar, Haryana and Rajasthan

1% are from Assam, Chandigarh, Jharkhand, Orissa, Pondicherry and Punjab

By cities:

17% are from Mumbai and Delhi each

7% are from Chennai

5% from Kolkata and Bangalore each

3% from Hyderabad and Pune each

2% from Ahmedabad and Lucknow each

1% each from Vadodara, Bhopal, Bhubaneshwar, Chandigarh, Cochin, Guwahati, Indore, Jaipur, Kanpur, Nagpur, Patna and Thiruvanthanapuram each.

Other online activities of users who use the net for job searches:

Email: 99% of online job searchers also use the net for emails

Chatting: 52% of online job searchers also use the net for chatting

Surfing: 74% of online job searchers also use the net for surfing. It is 3% higher than ‘All respondents’

2.5 Case studies:

The following cases can give an insight to the technology followed by the companies:

Texas instruments:

‘ At Texas instruments (TI), once you hit the “submit your resume “button on its recruiting site, TI has a cyber recruiting team that actually reads the resumes sent to them via the web. They read a resume and do a quick comparison with the positions currently open. Depending on the number of resumes received, it is possible that someone from Ti will contact an applicant on the same day. If a strong match to one of the openings exists then they are given e-mail or contacted through phones. Once the applicant is contacted through phone then he is asked more questions. Once the manager is satisfied with the performance the applicant is asked to visit TI. However the company can make hiring decisions through phone or e-mail. According to TI, the number of people hired via internet has tripled within the last year. It is estimated that TI completes the whole process through web within days or couple of weeks after receiving a resume’ (Robert, 2006).

CMC’s solution to the Public sector recruitments

A little about Public Sector / Government Service Recruitments

“Public sector recruitment processing is an extremely sensitive and confidential work involving thousands of eager applicants waiting to fill up a few available posts. There are various reservations under various quota and category as per the prevailing Government rules. These criteria need to be strictly adhered to at the same time ensuring a fully transparent system. Despite these stringent criteria the vacancies need to be filled up in the shortest time frame by identifying and reaching out to the best talents in the country

The Challenges

To complement, but not replace, the traditional paper-based system.

To demonstrate their commitment to total transparency as per the recruitment policies

To widen their pool of applicants”

CMC’s Approach and Solution

Pre Test – Automation:

Online web portal is used by the applicants to register online. Applicants can browse

through the eligibility/ reservation and availability of posts and apply accordingly. The applicants are immediately informed about the status of their application and whether they are eligible for the written test which reduces the time and ‘manual srutinity and postal reply delays’. The hall ticket is either available online or availability is intimated through e-mail.

The automation also helps the management to check the statistical details about the number of applicants applied online through which decisions about the applications dates or announcement of test dates and so on can be decided.

“CMC has specially designed application forms which are “ICR readable” (Intelligent Character Recognition) where the applicant fills up in capital letters in specified boxes in the form. This enables CMC to capture the applicant’s data using high speed scanners and applying ICR technology with minimum manual intervention (to the tune of 5% in the case of numeric fields) and apply the various criteria for processing the same for a written test. The images of the application forms are also archived in this process. Scanning also enables the applicants photograph, signature and his personnel data to be printed in his admit card in exactly the way he had filled it up”.

Test Conduction and Evaluation Automation

CMC has the options for both online test conduction as well as OMR based written test evaluation. (Optical Mark Reader). In the online test method the applicant is required to give his test online through computers and the result can be automatically given by the computer. In the paper test method- the applicant fills up his application as well as writes the objective type test where the candidate is required to darken the option appropriate to the question available on the OMR sheet. The sheet is then automatically scanned using high speed scanners. Accuracy is extremely high for an OMR based scanning system.

Post Test Automation:

.

The test results are even posted on web where the applicant can view his results and ranking. Depending on the overall results the management can easily fix the various cut-offs for the next phase – interviews, medical tests, Group discussions can be conducted further depending on the jobs criteria. The interview call letters are posted to the applicant online which can also be downloaded. Thus the entire system is fully transparent and merit based (customer case studies, anon).

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