Why Pay For S&R
When we look at business it is important to remember that everything has a cost associated with it and that when budgets are getting created the money is going to go towards parties that are directly bringing in money. Another example of a cost that frequently gets overlooked, but has a similar importance to recruitment and selection but is also often overlooked is training and development. Well, both of these have a high impact on the success of the business their results can be harder to see. Whereas if you make an investment in a new asset (building, new machine, new product, etc.) it is much easier to visualize those costs
I think that the biggest reason companies overlook these costs are because unless you have a cost analysis on your hiring process it can be difficult to visualize just how much hiring someone can really be. The example that I will use from the real world is how often people make the argument that unions only really exist to protect bad workers when in fact the blame lies with the people that hired the poor workers in the first place.
The S&R Cost Function
Well I do think that there can be some companies that are able to get away without prioritizing recruitment and selection, they are definitely a very small minority and they would face their own specialized problems. With the previous statement you might be thinking that I am suggesting that every company needs to prioritize recruitment and selection but that is also not the case. I think that much like many other things R&S costs exist on a graph with high skill cap unionized workers (wielders, medical staff, Ect) existing on one end and low skill cap non-unionized workers on the other end*.
The largest weakness of choosing to not prioritize R&S costs is that you could make a bad decision that costs your company hundreds of thousands of dollars that could have been prevented from just taking on some additional costs when looking at people. A great example of this would be OSU needing to pay out 600,000 dollars to our most recent president because not enough time was spent during the R&S process and as such when incriminating information was later brought to light they needed to pay a large amount of money to make up for this mistake.
*(Sorry I am not an artist to help visualize a graph with a skill cap on one axis and then unionization on the other. Companies that primarily employ people in the lower left (low skill no union) could get away with focusing less on R&S costs well companies that employ people in the upper right need to focus on them more.)
