This study rests on Human Capital Theory, Resource Based View Theory and

Equity Theory. Human Capital theory as proposed Adam Smith (1723-1790) in

Teixeira (2002) has the central idea that people are fixed capitals just like
machine because they have skills and useful abilities that has genuine cost
and yields profits. The premise in the human capital theory, according to
Armstrong (2006) is that people and their collective skills, abilities and
experience, coupled with their ability to deploy these in the interests of the
employing organization, are now recognized as making a significant
contribution to organizational success and also constituting a significant
source of competitive advantage. Resource Based View (RBV) of Barney
(1991) suggests that sustainable competitive advantage is attainable when
firms have a human resource pool which cannot be imitated or substituted by
rivals. According to the Resource-Based view, firms should constantly
evaluate their workforce to ensure that they have the right people with the
right skills in the right places to ensure sustained competitive advantage
(Barney, 2001) and when this is not the case, firms should make-up for the
shortfall by employing appropriate recruitment and selection criteria. The
theory maintained that the major part of any firms strength or weakness
stem from the calibre of the people employed and the quality of their working
relationships. To

this end, Boxall (1998) revealed that firms which recruit and retain
exceptional individuals have the capability of generating human capital
advantage. According to Sparrow et al., (2002), technology and capital can be
acquired by most firms any time, for a price, but it is not easy to acquire a
ready pool of highly qualified and motivated employees. Thus, in order to be
differentiated, the companies need to be very careful with the recruitment
and selection process.

Equity Theory as proposed by Adams (1963), underlines the principle of fairness. According to
the principles of the Equity Theory, the best recruitment and selection criteria in the organization
is that which portrays the firm as Equal Opportunity Employer
Finding competent workers is an important organizational challenge (McEvoy,
1984; Deshpande & Golhar, 1994; Atkinson & Storey, 1994), with the
difficulty centering on recruiting and selecting employees with the correct
qualifications to help achieve goals (Priyanath, 2006). As further argued in
Priyanath (2006) this problem is compounded by the lack of systematic
method for recruiting and selecting employees. A systematic recruitment
process according to Gamage (2014) involves indentifying vacancies, job
analysis, job description, person specification and advertising. As against
informal process for recruiting and selecting employees, a systematic
selection process involves the recruiting process, gathering information about
qualified applicants, evaluating the qualification of each applicant and
making decisions about employment (Gamage, 2014).

LITERATURE REVIEW

Recruitment and selection are vital functions of human resource

management for any type of business organization. These are
terms that refer to the process of attracting and choosing
candidates for employment. The quality of the human resource
the firm has heavily depends on the effectiveness of these two
functions (Gamage, 2014).

Recruiting and selecting the wrong candidates who are not

capable come with a huge negative cost which businesses
cannot afford. Thus, the overall aim of recruitment and
selection within the organization is to obtain the number and
quality of employees that are required to satisfy the strategic
objectives of the organization, at minimal cost (Ofori &
Aryeetey, 2011).

As explained by Opatha (2010) recruitment is the process of

finding and attracting suitably qualified people to apply for job
vacancies in the organization. It is a set of activities an
organization uses to attract job candidates who have the
needed abilities and attitudes. Recruitment is the process of
generating a pool of qualified applicants for organizational job
vacancies.

For Ofori and Aryeetey (2011) recruitment is the process of

generating a pool of competent individuals to apply for
employment within an organization. Evidence has shown that
larger corporations are more likely than smaller organizations in
implementing sophisticated recruitment processes (Bacon &
Hoque, 2005) with majority of smaller organizations relying on
referrals and advertising as their recruitment practices of
choice (Barber, Wesson, Roberso & Taylor, 1999).

The general purpose of recruitment according to Gamage

(2014) is to provide the organization with a pool of potentially
qualified job candidates. The quality of human resource in an
organization highly depends on the quality of applicants
attracted because organization is going to select employees
from those who were attracted. In the same vein, Henry and
Temtime (2009) construed recruitment as the entry point of
manpower into an organization and the path an organization
must follow from there on in order to make sure that they have
attracted the right individuals for their culture and vibes so that
the overall strategic goals are achieved .

On the other hand, selection is the process of making the

choice of the most suitable applicant from the pool of
applicants recruited to fill the relevant job vacancy (Opatha,
2010). Selection is the process by which specific instruments
are engaged to choose from the pool of individuals most
suitable for the job available (Ofori & Aryeetey, 2011). Selection
involves the use of one or more methods to assess applicants
suitability in order to make the correct selection decision and
can be alternatively seen as a process of rejection as it rejects a
number of applicants and select only a few applicants to fill the
vacancy. Thus, selection function may be a negative function
rather than a positive function (Gamage, 2014)
Gamage, A. S. (2014). Recruitment and selection practices in manufacturing SMEs in
Japan: An analysis of the link with business performance. Ruhuna Journal of Management
and Finance, 1(1), 37-52

Perfect Selection

The objectives of selection are to get te right person to the

right job, establish and maintain a good image as a good
employer and maintain the selections as cost effective as
possible. Gamage, A.S (2014) Amanah Raya Berhad need to do
perfect selection since that selection is extremely important
aspect to consider for businesses due to number of reasons.
This due to the performance of business related directly to the
people working within it. It is meaning that the right people
need to be hired to ensure Amanah Raya Berhad success.

According to Gamage (2014) the objectives of selection function are to get the
right person to the right job, establish and maintain a good image as a good
employer, and maintain the selection process as cost effective as possible.
Selection is an extremely important aspect to consider for businesses due to a
number of reasons. Often the performance of businesses relates directly to the
people working within it, meaning the right people need to be hired to ensure
organizational success (Henry & Temtime, 2009). It is also an expensive process
to hire someone new into the organization. So it is not something organizations
want to put time and money into just to find they have hired somebody who is
not suitable. It is vital that organizations get the process right the first time
round, because resources are scarce enough as it is. Selecting the right applicant
can be a difficult task, but at the end of the day, the organizations reputation is
held by the people it employs (Henry & Temtime, 2009).

Recruitment, Selection Criteria and Organizational

Performance

Recruitment and selection form a major part of an

organizations overall resourcing strategies, which identifies
and secures people needed for an organization to survive and
succeed in the short to medium-term (Elwood & James, 1996).

In fact, the basic purpose of recruitment is to create a pool of

suitably qualified candidates to enable the selection of the best
candidates for the organization, by attracting more and more
employees to apply in the organization whereas the basic
purpose of selection process is to choose the right candidate to
fill the various positions in the organization (Gamage, 2014).
Available evidence indicates that there is a positive and
significant relationship between recruitment and selection and
the performance of an enterprise (Gamage, 2014). Sang (2005)
for example discovered a positive association between
recruitment and selection and business performance. Such
were also of positive results between recruitment and selection
and performance as seen in Ichniowski and Shaw (1999), Katou
and Budhwar (2006) and Wright et al. (2005). Other studies
such as Syed and Jama (2012) have equally shown that
implementing an effective recruitment and selection process is
positively related to organizational performance.

With specific reference to recruitment and selection criteria and

organizational performance, Montana and Charnov (2000)
maintained that recruitment and selection include sourcing
candidates by advertising or other methods, screening
potential candidates using tests and interviews, selecting
candidates based on the results of the tests or interviews, and
on-boarding to ensure that the candidates are able to fulfill
their new roles effectively.

According to Huselid(1995) it is recruitment procedures that

provide a large pool of qualified applicants, paired with a
reliable and valid selection regime that will have a substantial
influence over the quality and type of skills new employees
possess. The implication of this line of thought is that an
organizations human resource policies and practices represent
important forces for shaping employee behaviour and attitudes.

For Gamage (2014) the selection practices will determine who

is hired. If properly designed, it will identify competent
candidates and accurately match them to the job. The use of
the proper selection device will increase the probability that the
right person is chosen to fill a slot. When the best people are
selected for the job, productivity increases.

Little wonder that literature such as Terpstra and Rozell (1993)

reported of a positive association between the extensiveness of
recruiting, selection test validation and the use of formal
selection procedures and firm profits. Similarly, Rauf (2007)
discovered that sophisticated recruitment and selection
procedures are positively related to performance in
organizations.

Writing on some of the challenges facing recruitment and

selection criteria in organizations, Istvn (2010) observed that
there are a plenty of techniques used in recruitment and hiring
today among which are some methods not accepted by experts
universally, or not recommended for the hiring process. As
argued by Istvn (2010), selection methods can be evaluated in
several ways. One possible approach is to compare hiring
techniques on the basis of their validity, impartiality, scope of
usage, and cost.

In all, Sinha and Thaly (2013) noted that there is a variety of

recruitment approaches (e.g. employee referral, campus
recruitment, advertising, recruitment agencies/consultants, job
sites/portals, company websites, social media etc.); and most
organizations will use a combination of two or more of these as
part of a recruitment process or to deliver their overall
recruitment strategy. However, which recruiting channels
should be used depends on the job position, on the companys
employer brand, on the resources the company has on its
recruiting team, on how much recruiting budget the company
has, etc. One can use them all and find out which suits the
best. Every recruiting channel offers different benefits and
limitations and works better for certain situations and
companies. The key is collecting real-time recruitment metrics
on these recruiting channels to figure out what works best for
the company in different situations. The recruiting experience
of each company is different and the best way to figure out
what works best is to analyze metrics based on the past
recruiting efforts, not the efforts of everybody else. Once the
company has its recruiting metrics solution in place, it is time
to start using the recruiting channels that the company thinks
will work for it (Sinha & Thaly, 2013).

Recruitment and Selection Quality and Organizational

Performance

The effectiveness of different recruitment and selection criteria

of employees has been the topic of research for over 60 years
(Sinha & Thaly, 2013). The effectiveness has primarily been
assessed by examining the rates of turnover, job survival and
job performance along with organizational issues such as
referrals by current personnel, in-house job postings, and the
re-hiring of former employees (Zottoli & Wanous, 2000).

The study by Sen and Saxena (1997) has emphasized the

importance of a quality process during the time of recruitment
and hiring given that the right type of labor is hard to come by.
In fact, while lending credence to the importance of hiring
quality candidates who are hard to find Tendon (2006) warned
that talent deficiency is unrelated to huge population. While
reporting that recruitment is the only component for attracting
and retaining knowledge workers, Unwin (2005) gave
significance to the process involved during the time of
recruiting and hiring good candidate.

Although the study conducted by Subbarao (2006) explained

the recruitment sources used by individual job seekers at
various levels, the study further highlighted the importance of
different types of approaches used at the time of recruitment
which in turn makes any organization well-established or less
established.

According to Sarkar and Kumar (2007) organizational

performance is hinged on the approach which the organization
adopts in the recruitment and selection of employees. To this
end, Sarkar and Kumar (2007) spoke of a holistic model of
recruitment i.e. emphasizing the importance of the whole
process of recruitment and the interdependence of its parts
(Sinha & Thaly, 2013).

Vyas (2011) asserted that the current trend is that

organizations are looking for methods of reducing the time and
effort in the recruitment and selection process. However,
Munyon, Summers, Ferris and Gerald (2011) admonished that
methods of team staffing should translate to competitive
advantages to a firms.

In similar vein, DeVaro (2008) demonstrated that recruitment

strategies can lead to positive organizational outcomes. For
Sinha and Thaly (2013) adopting qualitative system in
recruitment and selection has helped organizations to grow as
they have been able to get the right people for their vacancies.
In addition, the appropriate channels have helped the
organizations to get the different and varied sources to which
they can turn to for effective hiring (Sinha & Thaly, 2013).

Recruitment and selection in any organization is a serious

business as the success of any organization or efficiency in
service delivery depends on the quality of its workforce who
was recruited into the organization through recruitment and
selection exercises (Ezeali and Esiagu, 2010). Since recruitment
and selection involve getting the best applicant for a job
(Obikeze & Obi, 2004), it has been emphasized that recruitment
procedures that provide a large pool of qualified applicants,
paired with a reliable and valid selection regime, will have a
substantial influence over the quality and type of skills new
employees possess (Okoh, 2005). For Mullins (1999) the
important thing is for some suitable plan to be used, complying
with all legal requirements relating to employment and equal
opportunities, to follow recommended codes of practice and to
ensure justice and fair treatment for all applicants.
Bohlander, Snell & Sherman (2001) reported that it is important
for managers to understand the objectives, policies and
practices used for selection. More importantly, those
responsible for making selection decisions should have
adequate information upon which to base their decisions. As
Robbins (2005) observed, organizations human resource
policies and practices represent important forces for shaping
employee behaviour and attitudes. According to Okoh (2005),
not just that organizational selection practices determine who is
hired, the use of the proper selection

Global Journal of Human Resource Management Vol.3, No.2,

pp.22-33, March 2015 Published by European Centre for
Research Training and Development UK (www.eajournals.org)
28 ISSN 2053-5686(Print), ISSN 2053-5694(Online)

criteria will increase the probability that the right person will be
chosen. When the best people are selected for the job,
productivity increases (Osemeke, 2012)