Graduates' reactions to recruitment process outsourcing: A scenario‐based study

• Published date: 01 July 2012
• Author: Marius Claus Wehner,Rüdiger Kabst,Angelo Giardini
• DOI: http://doi.org/10.1002/hrm.21490
• Date: 01 July 2012

GRADUATES’ REACTIONS

TO RECRUITMENT PROCESS

OUTSOURCING: A SCENARIO-

BASED STUDY

MARIUS CLAUS WEHNER, ANGELO GIARDINI,

AND RÜDIGER KABST

This study examines how successive outsourcing of recruitment activities

to an external provider—also known as recruitment process outsourcing

(RPO)—affects graduates’ reactions. Using an experimental scenario tech-

nique, a total of 158 graduates participated in four hypothetical scenarios

that have been developed as an experimental between-subject design. Re-

sults provide support for negative effects of the extent of RPO on graduates’

satisfaction with the recruitment process and company attractiveness. More-

over, mediated by graduates’ satisfaction with the recruitment process and

company attractiveness, an increasing extent of RPO negatively infl uences

job-acceptance intentions. © 2012 Wiley Periodicals, Inc.

Keywords: outsourcing, recruitment, selection, applicant reaction

Introduction

Attracting and selecting talented and

well-educated applicants is an im-

portant challenge for organizations

(Michaels, Handfield-Jones, &

Axelrod, 2001). Therefore, predic-

tors of applicants’ job choice have always

been a central topic in research on personnel

selection. Whereas early studies focus on the

importance of job attributes and organiza-

tional characteristics for applicants’ job choice

(e.g., Gatewood, Gowan, & Lautenschlager,

1993; Powell, 1984), the attention has re-

cently shifted toward the importance of the

recruitment process (Chapman, Uggerslev,

Carroll, Piasentin, & Jones, 2005; Chapman &

Webster, 2006; Hausknecht, Day, & Thomas,

2004). In this regard, critical contact theory

proposes that the way applicants are treated

and selected during the recruitment process

is important for their job choice (Behling,

Labovitz, & Gainer, 1968). Critical contact

Correspondence to: Marius Claus Wehner, University of Giessen, Faculty of Economics and Business Administration,

Licher Str. 62, 35394 Giessen, Germany, Phone: 49 (0)641 99 22102, Fax: 49 (0)641 99 22109, E-mail: marius.wehner@

wirtschaft.uni-giessen.de.

Human Resource Management,

Human Resource Management, July–August 2012, Vol. 51, No. 4. Pp. 601–624

© 2012 Wiley Periodicals, Inc.

Published online in Wiley Online Library (wileyonlinelibrary.com).

DOI:10.1002/hrm.21490

602 HUMAN RESOURCE MANAGEMENT, JULY–AUGUST 2012

Human Resource Management DOI: 10.1002/hrm

Notwithstanding its

important insights,

past research has

not considered

the applicant’s

perspective to

explain whether

outsourcing of

HR recruitment

practices also

has negative

consequences.

have been widely acknowledged (e.g., Gainey

& Klaas, 2003; Klaas, McClendon, & Gainey,

1999).

Notwithstanding its important insights,

past research has not considered the appli-

cant’s perspective to explain whether out-

sourcing of HR recruitment practices also has

negative consequences. Critical contact the-

ory suggests that applicants evaluate the initial

contact with an organization (Behling et al.,

1968). The crucial factor is that the potential

employer has to value and esteem its appli-

cants. Almost half a century ago, Gerstner

(1966) summarized the view of a graduate as

the following, “What’s more, they’ve shown

a real interest in me and it looks like a good

opportunity” (p. 6). If an organization deliv-

ers parts of its recruitment activities to an

external provider, the organization alters the

prerequisites of the initial contact with its ap-

plicants because a third-party company is

involved. For instance, if the external pro-

vider conducts the preselection and/or tele-

phone inter view, the initial contact is made

between external provider and applicant in-

stead of between the potential employer and

applicant. Consequently, applicants may not

have a sense of being valued, which in turn

may negatively influence their perception of

the employer or the job. Thus, the outsourc-

ing company (i.e., potential employer) runs

the risk of sending unintended or even nega-

tive signals to applicants and losing the best

candidates for a job vacancy (Giardini &

Kabst, 2008; Ployhart & Ryan, 1998; Smither,

Reilly, Millsap, Pearlman, & Stoffey, 1993).

The contribution of this study is on the

link between selection procedures and appli-

cants’ reactions by investigating a contextual

characteristic that has rarely been studied so

far—the outsourcing of the HR recruitment

and selection process. In particular, we argue

that the higher the extent to which an exter-

nal provider (visibly) carries out recruitment

activities for an organization (e.g., handling

of applications, screening and preselection of

candidates, first interviews), the more nega-

tive are applicants’ reactions toward the se-

lection procedure, the organization, and the

job. To this end, we developed an experimen-

tal between-subject design consisting of four

theorists believe that candidates make their

decision based on critical contact elements

due to limited information (Behling et al.,

1968; Pounder & Merrill, 2001). These ele-

ments are, for instance, persons who have

first contact with the applicants, the build-

ings, or a firm’s efficiency in processing the

applications (Behling et al., 1968), even

though these elements are independent from

long-term employment satisfaction. Thus,

the intention to accept a job offer is mainly

driven by the initial contact with the organi-

zation (Pounder & Merrill, 2001; Schwab,

Rynes, & Aldag, 1987).

Consequently, organizations put much

effort into conducting fair, transparent, and

professional recruitment pro-

cesses to send positive signals to

their applicants (e.g., Lievens, Van

Hoye, & Anseel, 2007; Turban,

Forret, & Hendrickson, 1998).

While some organizations try to

achieve this purpose by develop-

ing and investing in their own

personnel recruitment, an increas-

ing number of organizations del-

egate parts of their recruiting ac-

tivities to external providers of HR

services (e.g., Dasborough & Sue-

Chan, 2002; Ordanini & Silvestri,

2008). Besides outsourcing of

other HR practices (e.g., payroll,

benefits, and training and devel-

opment), recruitment and selec-

tion belongs to those HR activities

that are most frequently out-

sourced (cf. Galanaki & Papalex-

andris, 2005; Shen, 2005). Recruit-

ment and selection practices need

to be conducted regularly due to employee

turnover and the growth of organizations.

Moreover, they are highly standardized and

the performance of an external provider is

easy to control by a client. As a result, organi-

zations outsource their HR activities in order

to save costs (Byham & Riddle, 1999), en-

hance the efficiency and quality of their HR

activities, and allow the HR function to focus

on strategic issues (Belcourt, 2006; Cooke,

Shen, & McBride, 2005; Delmotte & Sels,

2008). These advantages of HR outsourcing