Canadian Pacific and International Bank (CPIB) had achieved significant expansion in its operations in the recent past and is currently a major global financial institution (see end of Chapter 1 for more details on the bank). One key component of its growth strategy was the acquisition of other financial institutions. While in most instances CPIB has been able to achieve a seamless merger of operations, there were times when the systems and culture of the newly acquired organization were at variance with CPIB’s. This had necessitated routine internal audits of all major systems in newly acquired institutions.

Mary Keddy, vice-president of human resources, is currently looking through the results of an audit of the recruitment function in Ontario Financial Planners (OFP), an investment firm CPIB had acquired in the past. Table 1 shows a summary of relevant data for the last two years for two major groups of employees: investment managers and analysts, and sales staff. The other categories of staff (such as administrative and clerical) remained more or less stable across time. Several other activities in the firm were also contracted out to agencies or carried out by part-time employees. Other details of the workforce are given below.

OFP, which was begun by two brothers as a family business unit, had over time grown rapidly because of its professional approach to conducting business and friendly client relations. To ensure maximum predictability in employee behaviours, historically the firm had focused on employing family members, friends, and others referred by them. Over a period, however, this practice was replaced by several other recruiting methods. The firm also attempted to have representation from minority groups and women in all its job categories, although this has not always been successful. The financial planning industry has, by and large, always been a white-male-dominated profession—over 75 percent of the investment and financial planners in the industry were white males. The senior and middle-level managers were also mostly white males, Asian Canadians being one of the more successful minorities to reach the position of portfolio or fund managers. The only exception to this general trend was commission-based sales jobs where women were making fast inroads, often reaching nearly one-half of total workforce in that category.

Getting well-qualified and competent financial planners was a challenging task since demand for proven analysts and managers was great until the stock market crash of 2008. During the global financial crash, banks were particularly affected. While CPIB had relatively minor investments in the risky portfolios that fatally affected several American and European banks, even CPIB’s mutual funds division faced a significant and adverse decline in demand, necessitating reconfiguration of its workforce. This meant that the attrition of qualified persons was high, often reaching upwards of 20 percent for many firms. Hiring qualified analysts and investment managers was also fraught with considerable difficulties since the wrong hire could cause considerable damage to the company’s reputation and customers’ trust at a time when investment confidence was already at a low.

The average age of investment analysts and managers in OFP was in the low- to mid-forties. Hardly anyone had retired in that job category in the past year. In the sales category, the average age was slightly higher. One person had retired in the last year.

The figures in Table 1 reflect historical costs. The following recruitment methods are found to be more expensive currently, requiring upward adjustment.

Campus recruiting: increase by 15%

Advertisements: increase by 10%

Internet recruiting: increase by 5%

While common selection criteria were employed in hiring employees irrespective of the recruitment methods they came through, OFP’s experience was that recruits from different sources required different levels of on-the-job training before they could be placed into job positions. The average cost of a day’s training was approximately $700, which accounted for all costs including time lost. The firm’s records show the following training statistics for various recruits:

Unsolicited applicants: 3 days

Recruits from ESDC, Internet, advertisements: 2 days

Campus recruits, applicants referred by current employees: 1 day

DISCUSSION QUESTIONS

1.	Make your recommendation on the best recruitment method(s) for each type of workforce.
2.	What other conclusions can you arrive at when looking at the figures provided in the case?

TABLE 1

Recruiting Method Used during the Past Year
			Investment Managers and Analyst				Sales Staff
Gender
Males			85%				60%
Females			15%				40%
Age:
Less than 30 years			60%				30%
30–45 years			20%				45%
46–65 years			20%				25%
Education:
High school or less			10%				60%
University degree or higher			90%				40%
Recruiting Method Used during the Past Two Years
	Unsolicited Applications	ESDC		Campus Recruitment	Advertisements	Internet Recruitment		Referrals from Employees
Total Number of Applications
Investment managers	50	70		60	200	250		30
Sales staff	40	60		40	300	100		10
Number of Candidates Who Were Offered Jobs
Investment managers	1	7		9	12	13		9
Sales staff	2	3		2	30	10		2
Number of Candidates Who Accepted Job Offers
Investment managers	1	3		6	6	10		6
Sales staff	1	2		2	21	4		1
Cost per Recruit in Dollars (includes all overheads)
Investment managers	45	36		66	60	16		26
Sales staff	42	30		63	48	17		23
Number of New Hires Who Left the Firm Within Two Years
Investment managers	0	1		1	3	6		1
Sales staff	1	1		0	2	1		1