HR Strategy, Recruiting, and Compensation Best Practices

Business, Legal, and Financial Environment

SEIIC operates in a technical insurance business. While the business has changed from its traditional characteristics since 9/11, those changes were not outlined in the case, so very little is known about the specific challenges the company faces in the industry today — only that it is struggling. The business environment is becoming more competitive. This could mean increased competition from foreign providers or simply new domestic companies entering the market. Insurance has always been quantitative in nature, so it is also possible that the rise of built-in diagnostics has significantly changed the role of the heavy-equipment inspector, making it less of a specialized technical skill than it once was. The skill set demanded of workers is almost certainly different from what it once was. Otherwise, the way government regulates the insurance industry has not changed substantially, unless a court ruling altered how awards are granted — that kind of legal shift could meaningfully change the operating environment.

The financial environment is similarly unclear, but if the company has been struggling for several years, the implication for its financial condition is straightforward — it is likely poor at this point. SEIIC is probably no longer able to simply buy the best talent on the open market, and if margins have been compressed over the long run, the company may never return to former levels of profitability. It is reasonable to assume that significant financial constraints exist at this point.

This context pushes the company toward a change in its overall strategy. Understanding that strategy is essential to integrating human resources as a true strategic partner. This is one of the major trends in HR — the case should have highlighted SEIIC's overall strategy in order to better incorporate strategic HR principles into the discussion. A number of forces have elevated human resources to the role of a critical strategic partner, particularly the role that service and technical staff play in organizational success today. The more knowledge work an organization performs, the more important the human resources function becomes (Lawler, 2005).

Trends and Best Practices in Recruiting and Staffing

One prominent trend in recruiting is e-recruiting. Companies have been recruiting online for over a decade, and today it is the most common method of searching for new employees (Iannotta & Gatti, 2015). E-recruiting is used for both experienced workers and new college recruits, effectively replacing traditional in-person college recruiting in many cases (Diepenbrock & Gibson, 2014). However, because virtually every employer now uses this approach, it is a challenge for any single company to stand out — especially one with a declining reputation or a limited ability to offer top-market pay. SEIIC will need to be creative in distinguishing itself, perhaps by directly targeting prospective workers through social media advertising to create more of a "pull" strategy, rather than simply waiting for talent to find the company.

Another best practice in recruiting is the use of internships, whether paid or unpaid. Internships provide a better opportunity to identify the right match between the worker and the organization. One common driver of turnover is a mismatch between employee expectations and company reality; if SEIIC has changed significantly over the years and its current conditions, roles, and culture do not align with its external reputation, internships can give younger workers a firsthand look and correct any negative assumptions they may have formed.

References

Diepenbrock, A. & Gibson, W. (2014). The use of social media in college recruiting and the student job search. Information Science Reference: Hershey, PA.

Friedberg, L. (2001). The impact of technological change on older workers: Evidence from data on computer use. NBER Working Paper No. 8297.

Iannotta, M. & Gatti, M. (2015). Innovating e-recruitment services: An Italian case study. Empowering Organizations, 11, 103–114.

Lawler, E. (2005). Strategic human resources management. Center for Effective Organizations G05-10 (482).

Michalek, F. & Long, M. (2013). Cohabitation with millennials in the workplace: A contemporary challenge for leadership. Linnaeus University.