| Apple Inc E-Recruitment | By Atchar Suwattanathum : Student no. 08837612 | MNM59 Lecturer’s Name: Asher Rospigliosi, Clare Millington, Maura Sheehan and Sian Eggert 1st Submission Date Due: 15st April 2010 17:00 PM Number of Pages: 23 Word Count: 4,020 Executive Summary This report approach basic knowledge, techniques, theories and statistics in human resource recruitment and information system to access the most proper solution for E-Recruitment system implementation of Apple Inc. The advantages and disadvantage of E-Recruitment was used to be information in order to determine alternatives.

The most admire company of business people like Apple Inc generally face with massive information of applicants that impact to human resource management in recruitment problem. The traditional and manual recruitment system cannot properly deal with the quantity because of limitations itself. The most proper alternative and characteristic of Apple’s E-Recruitment are evaluated in every stage of implementation. Pre-Implementation evaluate in project selection, feasibility study, analysis, design and construction.

Implementing timeline is the major concern in Implementation stage and Post-Implementation concerns with user’s feedback, reviewing project result, monitoring dual phased process between new and old software. With all aspect possibility evaluation of Apple’s E-Recruitment project, Apple Inc is able to use its core competency in computer and software market leader improve and develop organization’s current E-Recruitment system by creating its own in house software to solve the problem of massive application in order to select potential candidates with least time consuming.

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Table of Content Executive Summary2 1. Introduction5 2. Human Resource Management – Recruitment and Selection6 3. Human Resource Information System in E- Recruitment7 3. 1 Trend of recruitment platform7 3. 2 Advantages of E-Recruitment8 3. 3 Disadvantages of E-Recruitment9 4. Current recruitment system11 4. 1 Critical Apple’s recruitment system12 5. Recommendation and Implementation13 5. 1 Pre-Implementation stage13 5. 2 Implementation stage19 5. 3 Post-Implementation stage20 6. Conclusion21 Reference22 List of Tables

Table1: Estimating yearly cost saving of Apple’s E-Recruitment software15 Table 2: Success criteria weighting of Apple’s E-Recruitment16 List of Figures Figure 1: Apple website11 Figure 2: Apple E-Recruitment platform17 Figure 3: Example of Link software18 1. Introduction Apple Inc is the world best-known company for personal computer that was established by partner college dropouts in USA; Steve Wozniak and Steve Jobs in 1976. Just two year later, Apple Inc became one fastest growing company in USA with Macintosh software.

From 1989 to 1991 it was the golden age for Macintosh (Encyclopedia Britannica, 2010); however, due to high price in production, unrealistic marketing plan and departure of founder, Steve Job and many Apple executives in 1985 including Microsoft continued gain personal computer market share by Windows during 1991 to 1993, these reasons brought Apple depth into the Dark Age. Until returning of Steve Jobs in 1996 from acquisition with NeXT, he restructured Apple’s company strategy by emphasizing in differentiation strategy.

As wildly recognize that Apple’s products are outstanding in design and innovate leading which were prove from the successful of the introduction of new product lines; for example, The introduction of iPod in 2001that was phenomenally achievement in portable music players market with sale volume over 100 million units within six years. In addition, Apple aggressive competed into mobile market with iPhone which was launched on June 2007 and dramatically successful.

Apple has current three main product lines; iMac, iPod, and iPhone which were produced by subcontractors almost base in Asia such as China, Taiwan, Thailand, etc (Apple, 2010). Apple have opened Apple’s retail store and have been expanding to 273 stores worldwide in 2009 that made support the successful of Apple product distributions and shape the strong financial health of company. From the most admired companies ranking of CNN; Fortune’s survey on 22 March 2010, Apple is the number one most admire‘s businesspeople company from any industry (CNN, 2010). 2. Human Resource Management – Recruitment and Selection

Recruitment and selection referred to Bratton (Bratton et al, 2003) always is the important and first stage of human resource management function in company. The objective of recruitment about attracts the talent people to be the company’s employees following goal of company and labour demand forecasting; in addition, it is able to be one way to and promote advertise in the public’s mind. Referred to effective recruitment and selection practice (Compton et al, 2009), there are many method of recruitment that generally separate by source to internal and external source.

The internal source is such as transferring, department examination, and employee’s recommendation and so on. For external source that support in advertisement of organization such employment agency, job center, news paper, company website, etc. In the most case, company focus on recruit from external source due to generate more competition of candidate that means providing variety of choice and high potential to hire the employees of the dream.

Especially, in current many world class companies realize on value of human resource and development people more than ever before; for instance, Steve Jobs; Apple Inc CEO used to mention that “the most value asset of Apple Inc is employee”. However, the costly of recruitment of external resource is the major weak point of this way practically using job agency and newspapers and time consuming is another disadvantage which are management challenges and every company intend to overcome over past a year and a year. 3. Human Resource Information System in E- Recruitment

The idea of human resource information system (HRIS) came from merging between HR process with information technology in order to collect and maintain employee data accurately and effectively (Ceriello, 1998). HRIS in recruitment process over past 10 years were developed rabidly as the development in technology including occur new word and definition of HRIS in recruitment from the revolution of internet; E-recruitment or online recruitment is using web-based and internet -based for recruiting process (Hopkins, 2003). 3. Trend of recruitment platform During over past a decade there are wide spread of E-Recruitment referred to the information from survey if the Chartered Institute of Personnel and Development or CIPD in 2008 (CIPD, 2010), 75% of company use their own website to attract the applications and it is the fourth popular method in recruiting. There are growth of many big job boards player such as search4job, Seek and so on that allow candidates post and directly entry their information on website 24/7. In addition, the development of web 2. that related to two way communication facilitate interaction between whether users and sever and among users and users such as information sharing, web-based communities (Encyclopedia Britannica, 2010), this crated new recruitment platform in current and potential to be distribute widely in the future from increasing trend of users of community website; for instance, Facebook has more than 150 million worldwide users from CIPD survey in 2009 (CIPD, 2010). As Gordon Brown, the ex-British Prime Minister, mentioned that people more than 100 million are using online social networking site such Facebook, Twitter, YouTube and so on thus web 2. established a new interdependent and connected world. 3. 2 Advantages of E-Recruitment E-Recruitment revolted of 2000s recruitment platform with undeniably many benefits both tangible and intangible benefits (Boddy et al, 2005): 3. 2. 1 Tangible benefits First obviously benefit is vacancy advertisement cost saving, referred to CIPD survey in 2008 (CIPD, 2010), the employers more than 7 in 10 used cooperate websites to promote vacancy positions that 4 in 10 of respondents claimed that E-Recruitment can reduce recruitment cost 73%.

In addition, the investment in web-based and online recruitment require small amount of budget that in some companies use their IT employees to create and maintenance E-Recruitment system. Time saving is the second major advantage of E-Recruitment, as Gayleen Robinson, Staffcv marketing manager claimed the effectiveness of E-Recruitment that company compare between working time spent on manual and online method then convert to direct cost, the result was up to 90% of time saving. Not only employer’s time saving but also reduces applicants time and flexible in to access in database 24 hours.

Quality and accuracy of information improvement (Boddy et al, 2005), not only the computer-based and internet-based generally provide speed in searching, but also usually more accurate and consistency data including in terms of up-to-date information. The error is always unexpected costly expenditure that difficult to evaluating. 3. 2. 2 Intangible benefits Ferran claimed the intangible of IS investment (Ferran, 2008) that it was able to improve communication and image of company. This is directly concerned with reputation of company itself especially for international organization.

Impossibly, Apple Inc was the most attractive company in 2008 and maintain image of innovative organization, if it still uses manual system in recruitment. In addition, it can be the competitive advantage and help to support company’s strategy in term of differentiation (Porter, 1985). The firm is able to use this advantage to lead its competitors. On the other hand, the cost leadership company can also gain the advantages from tangible side to encourage its low cost strategy; for example, Virgin Blue Airline, Australian low cost airline is using online recruit all their cabin crew position( CIPD, 2010).

Moreover, the web-based recruitment system provides flexibility of HR staffs in case of the website was developed and maintenance by in house IT staffs by reducing the complex communication between outsourcing and HR user. And due to flexibility tend to reduce time consuming in routine recruitment activities so the chain benefit is HR employees have more available time for development and strategic tasks. Another indirectly tangible benefit that occurs from using in house IT staffs is; it supports learning and transfer knowledge within organization from sharing, storing and transferring information (Boddy et al, 2005). . 3 Disadvantages of E-Recruitment However, E-Recruitment has some weak points that each company necessary to consider as much as possible preventing the undesirable damages. Many individuals and researchers widely argued about E-Recruitment in terms of security and privacy issue especially in cases of job boards and society networking because normally applicants public their personnel information on web board. Besides, if compare technology in white side that is protected personnel data by programmer; on another way around, hacker is who use black side of technology for personnel benefits.

E-Recruitment usually is one way communication so it is a core limitation which almost entry company is not able to eliminate traditional face to face interview in selection process. Although many company allow applicants post or attach their additional information such as personnel story and experiences, it still without interaction between candidates and interviewers. HR staffs can use the individual’s story in narrative analysis to identify and evaluate suitability of applicant (Czarniawska, 1998). There were many reports showed E-Recruitment fail because of the internet limitation (Feldman et al, 2002, p175-206).

The job board normally overload with job proposing for social networking where had a lot user registered often response very slowly. Most of these problem potential to appear in developing countries rather than in developed countries. Although the quantity of candidates is the strong point of E-Recruitment, it is able to be weak point if consider at another aspect. Due to this attract both of talent candidates and persons who change job frequently more likely to be called job hoppers which base on survey 35% of staff who were hired from online recruitment had more than three times job changing within five years (Wuttke, 2008, p14).

It leads to high turnover rate and increase replacement cost Relationship and culture issue is another concern for HR manager, particularly online recruitment on job boards. Referred to Wolter’s study (Wolters, 2006), he mentioned about the negative relationship from comparison between suitable respondent and information proposal from job seekers. Furthermore, the impact of organization culture fit is a delicate and unable look across issue. Particularly, there is diversification of age and gender in organization. Mostly, young candidates use E-Recruitment more than older people and men more use online job searching than women (SHRM, 010). 4. Current recruitment system Due to Apple is the number one most admired company from ranking of CNN; Fortune’s survey on 22 March 2010 (CNN, 2010), Apple website attracted tons of candidate per day. Apple’s web-based uses Apple ID and password to identify huge such information. This is not necessary to Apple hire agency or outsourcing for recruitment that is advantage from company reputation. Apple web page is also a good advertisement channel; it posted a lot of attractive information for job seekers such as benefits of Apple staffs and VDO interview of Apple’s staff (Apple, 2010). Figure 1: Apple website Source: Apple (2010)

Noticeably, there is not Apple’s vacancy position post on job boards by company itself same as advertisement on job center also. 4. 1 Critical Apple’s recruitment system After considering Apple’s recruitment method and company profile, it was able to assume that the talent candidate attraction was not a major challenge of Apple HR department because of widely reputation and stability of company. Beside, due to Apple Inc is the well known in personnel computer industry and itself operating system Mac, it is strongly reason to conclude that Apple spent very small amount of capital in its website E-Recruitment system.

The potential problems of Apple E-Recruitment process should be how to deal with the enormous of CV and information to distill the most suitable employee with less time consuming? In addition, the main recruitment cost of big worldwide company like Apple Inc is not cost of advertising on publication sources or outsourcing and job agency like general small to medium company but it possibly to be hidden operating cost of HR staffs. The more working time for selection, the more labour cost of company that it is difficult to measure or estimate such hidden cost thus this is risky ircumstance of company because how can HR staff improve the recruitment if they cannot evaluate impact and wasting cost of system?. The general problem of E-Recruitment in quality of application’s information is also one issue of Apple with the limitation of one way communication. 5. Recommendation and Implementation To deal with massive of candidates information, HR department cooperate with IT department to develop in house Apple’s E-Recruitment software.

Apple not necessary to consider purchase software from outsourcing due to Apple has core employee who are expertise in software development and familiar with internal system including organization culture so it can be a guarantee sign of the high software performance ; in addition, obviously that outsourcing software purchasing require more investment than in house operating. However, E-Recruitment software take more developing time than purchasing a ready to use software but in aspects of costing and confidentiality of program performance seems outweigh than time consuming in program development issue.

Furthermore, indirect benefits from in house software are in the areas of differentiation generating that support Apple’s reputation and image; in addition, knowledge transfer and learning within organization that encourage company’s knowledge management. Step of development Apple’s E-Recruitment software can separate to three stages namely Pre-Implementation, Implementation and Post- Implementation. In addition, It can apply IS concept in system development life cycle or water fall model of Royce (Leffingwell, 2003). 5. 1 Pre-Implementation stage

Referred to waterfall model of Royce the step in project selection, feasibility study, analysis, design and construction require cooperating from all concern departments and major responsibility departments are HR and IT department. It is able to cut vendor selection process due to propose to use in house operating. 5. 1. 1 Project selection – Based on Critical Apple’s recruitment system and recommendation parts. It can conclude that Apple’s E-Recruitment software most suitable is created by in house IT staffs with commentary of company and estimated small budget that will be analyzed with economic feasibility in next step. 5. . 2 Feasibility studies – In parts of technical and operational are excellent possibility due to high skill of IT department and flexibility to creating software. In terms of economic feasibility, it concerns with making decision in project investment, Net present value (NPV) and Internal Rate of Return (IRR) are usually use in analyze the profitability of investment. Based to (Young, 2000), NPV concept is comparison between value of money in current and the value in the future with add inflation rate and if amount of NPV is less than zero that show the cash flow is negative that made the project is potential to be rejected.

In case of Apple Inc, this article selected IRR to analyze Apple’s E-Recruitment financial feasibility analysis instead of NPV. IRR is the actual yield of interest or discount rate from expected investment and its conclusion same as with NPV method. The basic principle in decision making is; if IRR greater than the weighted average cost of capital (WACC), the result is; E-Recruitment software development project is accepted because its rate of return on invested capital more than the cost of investment.

As showed in table1, it showed estimated yearly saving cost of Apple’s E-Recruitment software in labour, energy and maintenance. The estimated number based on annual report of Apple Inc in 2009 (Apple, 2010) Year| Savings Labour cost (4%Inflation) (€ 000)| Savings Energy and Maintenance (4%Inflation) (€ 000)| Total saving cost (€ 000)| Purchasing software (€ 000)| Software development and Energy and maintain cost (€ 000)| Depreciation of computer (€ 000)| Net profit from E-Recruitment Implementation after tax (€ 000)| IRR| 0| 0. 0| 0. | 0. 0| 0. 0 | (1,050. 0)|  | (630. 0)| 74%| 1| 1,100. 0| 50. 0| 1,150. 0|  | (20. 0)| (10. 0)| 442. 0 | | 2| 1,144. 0| 52. 0| 1,196. 0|  | (20. 0)| (10. 0)| 460. 4 | | 3| 1,189. 8| 54. 1| 1,243. 8|  | (20. 0)| (10. 0)| 479. 5 | | 4| 1,237. 4| 56. 2| 1,293. 6|  | (20. 0)| (10. 0)| 499. 4 | | 5| 1,286. 8| 58. 5| 1,345. 3|  | (20. 0)| (10. 0)| 520. 1 | | 6| 1,338. 3| 60. 8| 1,399. 2|  | (20. 0)| (10. 0)| 541. 7 | | 7| 1,391. 9| 63. 3| 1,455. 1|  | (20. 0)| (10. 0)| 564. 0 | | 8| 1,447. 5| 65. 8| 1,513. 3|  | (20. 0)| (10. 0)| 587. 3 | | 9| 1,505. | 68. 4| 1,573. 9|  | (20. 0)| (10. 0)| 611. 5 | | Table 1: Estimating yearly cost saving of Apple’s E-Recruitment software The IRR equation: 0 = i = Internal rate of return NCFt = Net cash flow year t Referred to IRR equation (Wilkinson, 2005), IRR = 74% that higher than 12% WACC; as a result of this, Apple are very highly favorable in decision implement E-Recruitment software. Based on estimated cost saving in this table, Apple is able to save around € 1. 15 million at the end of first year and payback period around 6. 5 month. 5. 1. Analysis – As mentioned in critical Apple’s recruitment system and recommendation parts, the main proposal of Apple’s E-Recruitment software emphasis on time saving selection, user friendly and quality of candidates. In analysis part should consisted of identify objectives and detail of requirements including critical failures is required considering. Based upon many survey statistics in IS implementation failure; for instance, survey of Cooper & Lybrand in 1995 found that large companies in UK more than 60% had problem with computer system fail in first two years of project implementation (Flowers, 1996).

Moreover, Standish Group also claimed in 1995 that there was around 31% of IS projects were canceled before implementation and 39% of specific functions were eliminated from originally specific function or the other word there was original features available around 61% after implementation (Standish Group,2010) . According to these statistics, it is very importance for Apple’s staff necessary to minimize potential failure in implementation and operating (Post-implementation) stage, every Apple’s responsible staff in this project should define and list all potential failure to access of success criteria.

Referred to scoring model of Standish Group (Standish Group, 2010), success criteria weighting score of Apple’s E-Recruitment software is showed as table 1. Success Criteria| Score| Project organization| | – Staffs competency| 7| – User involvement| 15| – Objective and feasibility| 10| – Effective planning time line| 8| Support| | – Executive management supporting| 17| – Experienced manager and staffs| 12| – Training support| 10| Environment| | – Company basic require and infrastructure| 11| – Organization culture| 5|

Other| 5| Total score| 100| Table 2: Success criteria weighting of Apple’s E-Recruitment software The supporting from Apple’s executive management is the most important of this project so project manager should perform in realistic view of project and role in team building to integrate cooperation between users and developers. Project manager is able to encourage morale, reduce stress and increase involvement of staffs that is second key success of Apple’s new software implementation. Figure 2 : Apple E-Recruitment platform

Source: Boddy (2005) Software should be designed and constructed base on agreement of every responsibility including department and line manager as figure 2 (Boddy, 2005) to minimize debug of program. There are not vendors or outsourcing in this figure as normal case due to it is in house software. The information transaction between HR staffs and candidates is limited by system interface. Scope downing information channel to one interface system made effective massive data organizing including prevent repeated information.

In addition, it has to response all key criteria from analysis phase in speech, users friendly and quality including covers all recruitment area; for instance, based on figure 3(Link, 2010), they are the examples of general operating of recruitment software that link candidate information in visible display, document management integrate and link with e-mail. , search engine, active schedule list and so on Figure 3: Example of Link software Source: Link (2010) The critical part of Apple’s E-Recruitment software is defining and distillation of applicant’s criteria.

The software should be designed intelligently and automatically match between data of candidates and vacancies position requirements including key performance index (KPI) from each department. After run this filter function, the potential candidates will be summarized, recorded and reported for next step of selection. To improve of quality of candidate from selection, Apple’s E-Recruitment software is able to eliminate general weak point of E-Recruitment system in terms of one way communication with idea of interactive application on Apple website to go beyond this limitation.

Not only candidates fill all information on website, but also upload their VDO to be additional narrative. In addition, Apple can interview real time by use VDO conference instead of face to face in some noncritical positions. And also, it can create interview online by post VDO of interviewees during ask questions and keep record of interaction of candidates. According to these ideas, they can improve in quality of candidate’s information issue including promote company image. 5. 2 Implementation stage

In implantation phase should considered about period of time and the key activity is evaluating the alternative among changeover or cutover (Flowers, 1996). A cutover method is; the practice in immediately stop old system and totally turn to operate new system replace old system. The obviously advantages of this alternative are; easy to operate because the staffs can focus on new software whereas ignore and not confuse with old system and also it requires short time for implement.

On the other hand, this method has high risky to make overall operating fail because there is not spare system (cutover old system) or tend to necessary turn to temporary manual operating; in case if new system occur some undesirable errors or unexpected problems. So this method requires very thorough preparation and more accurate and consistent pre- testing until new system is highly confidential system. The changeover alternatives consisted of parallel and phased method. For parallel concept, it is run new software parallel with old system and implement new software phase by phase with old program.

The key advantage point of parallel is safety aspect because it allows direct comparison between new software and whereas old software still running. There is overlap time of new and old program that both systems are parallel operated at the same time. However, slow processing is one of weak points of parallel method because it is unable to stop old system immediate thus it requires overlap time to compare between new and old system that made extend lead time of implementation longer. Moreover, it increased work load for staff heavier than cutover method due to the employees operate double works during the overlap period.

Phased method seems to be middle way of parallel and immediate method. The slightly replace old system with new system step by step by increasing operating of new system during old system roll-out. Phased method is the most suitable alternative for Apple’s E-Recruitment software implementation due to mix and match the advantages of parallel and immediately method and reducer risky and hard work load issue. In addition, due to this software will be developed by Apple’s IT staffs so there are not concerns in competency of vendor and communication support. 5. 3 Post-Implementation stage

This stage concerns with IS implementation satisfaction, reviewing project result, monitoring dual phased process (new vs old software) and continued fix bugs and upgrading software (Flowers, 1996). To reach in implementation satisfaction conclusion, Apple’s HR and IT staffs should review both of internal and external users. For internal users, they are able to summary from users’ opinion of concerned department by using questionnaires or interviews. In addition, they also can use this questionnaire for applicants who were selected in second round to evaluate satisfaction of candidate.

Project result evaluation require Apple’s HR and IT staffs evaluate performance in every aspects which were purposed in planning such as budget, cost saving , time management , etc and cross check with objectives of project to measure effectiveness of project and performance. Apple’s HR and IT staffs can use such performance evaluation to be basic information in for monitoring and improvement their software to sustain and gain maximum value from this Apple’s E-Recruitment software. 6. Conclusion

This report find that Apple Inc is able to use its core competency in computer and software area develop and improve organization’s HRM in recruitment by creating its own in house software to overcome massive information of candidates in recruitment process with shortest time and the best quality. From feasible summary, it conclude that Apple’s E-Recruitment software had highly potential to be successful by using small budget and high IRR rate at 74% and less than one year payback period.

In addition, the effective planning and failure analysis in all three stage of IS (Pre-Implementation, Implementation and Post-Implementation) are key successful of Apple’s E-Recruitment software development. Furthermore, with unique idea in interactive E-Recruitment, it perfectly supports Apple’s differentiation strategy and spread brand reputation of Apple. For future E-Recruitment system of Apple Inc possibly is developed by integrating with technology 2. 0 because of the popularity of job searching with internet- based and social net working that tend to higher trend in next decade.

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