Graduate recruitment and selection practices in small businesses

Jim Stewart Nottingham Business School, The Nottingham Trent University, UK Vanessa Knowles Nottingham Business School, The Nottingham Trent University, UK

The first article in this series highlighted the fact that the focus of research in the area of graduate recruitment and selection had emphasised the importance of transferable Abstract skills. Much of this research has, however, Reports the results of empirical concentrated on large organisations. In research into the graduate resetting the context for the research reported cruitment and selection practices here, it is important to highlight two adopted by SMEs, and the skills being sought by employers in that research findings which emerged from the sector. Describes in detail the review of published articles and journals in research methods, which included the area of graduate recruitment and interviews with large organisaselection. First, the Association of Graduate tions to determine, alongside exRecruiters (AGR, 1995) states that more isting research, the extent of characteristics of SME graduate graduates are entering the SME sector. recruitment which might be partiSecond, the report makes reference to this cular to that sector. Findings and trend presenting considerations not only for interpretations suggest that, in common with large organisations, undergraduates who are preparing to enter SMEs value what are now termed the ``world of work'', but also for SMEs in transferable skills, although there relation to their recruitment and selection are some differences of emphasis processes. Moreover, recruitment between the two sectors. There appears to be greater difference in implications exist for SMEs with regard to the selection methods employed, their competing against large organisations though this is not as great or for the ``best'' graduates. significant as might be expected Adopting an empirical approach, the or predicted. An important differauthors' research questions were, therefore, ence between the two sectors suggested by the research is the defined as follows: expectations placed on graduate . What skills and qualities do SMEs seek recruits by employers in the two from graduates? sectors. Unlike large employers . How do SMEs assess the possession of which are more likely to provide skills and qualities within the graduate development programmes, SMEs expect an imrecruitment and selection process? mediate contribution from . Do SMEs seek the same skills and graduate recruits. The implicaqualities as large organisations? tions of these similarities and differences will be explored in the . Do SMEs assess the possession of skills final article of this series. and qualities using the same method(s) as large organisations?
Keywords
Graduates, Recruitment, Selection, Small- to medium-sized enterprises

Research methods adopted

The primary research design consisted of two phases; the first phase was to conduct a survey on SMEs within the Greater Nottingham Training & Enterprise Council (GNTEC) area. The second phase was to conduct three interviews within SMEs located in the GNTEC area, with an additional two interviews to be conducted within large organisations based in the East Midlands region.

Primary research design the first phase

Using a large sample, the first phase of the primary research was concerned with addressing the following questions: . Do SMEs within the GNTEC area recruit graduates? . Which skills do SME recruiters consider important when making decisions within the recruitment and selection process? . What methods are used to assess the possession of skills within the recruitment and selection process? The method chosen to address these question areas was a questionnaire. Using a database which had been compiled for the purpose of previous research undertaken by one of the authors, the population was defined as ``SMEs in the GNTEC area, established prior to 1979, employing greater than zero but not more than 250 employees''. The size of the company used was in accordance with the DfEE's definition of a small and mediumsized enterprise. These constraints resulted in a population of 692 companies. The next stage was to draw a random sample, against which Gill and Johnson (1991) state that any subsequent findings can be generalised or extrapolated. The random sample size used for the primary research was 200 companies, which were chosen from
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The above questions are addressed via comparing the results from primary research conducted within SMEs, with the findings from both secondary research data, which was presented in the first article, and primary research conducted within large organisations.
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the population of 692 companies via the use of a dice, which resulted in the fourth company within the population being selected. Such a method was deemed an appropriate technique for composing a random sample, as the method complies with the definition proposed by Gill and Johnson (1991, p. 6) as being ``a sample in which all members of the specific population from which the sample is drawn have an equal chance of selection''. Considerations surrounding the issues of response rates and time scales influenced the decision of electing to work with the random sample size of 200 companies. Jankowicz (1995, p. 246) refers to researchers assuming ``a 10% baseline as a useful rule of thumb'' for a postal survey response rate. Having obtained the population and random sample for the purpose of the first phase, the issue of the questionnaire design needed to be addressed. Stewart (1997, p. 1) states that ``the most common mistake when setting out to collect information is to `dive in' without thinking through first what is required''. In designing the questionnaire, a cumulative three-staged approach proposed by Stewart (1997) was, therefore, adopted. This approach requires three vital questions, one at each stage of the process, to be satisfied prior to designing a research tool. Stage 1 requires the question ``What information do I want?'' to be considered. Stage 2 requires the researcher to contemplate ``Why do I want this information?'' and the third stage encourages deliberation to be devoted to the question of ``How will I use this information?'' The resulting questionnaire was piloted with a non-random sample of 20 companies. The questionnaire was designed using a combination of quantitative and qualitative questions and comprised three distinct sections. Section A was designed to obtain specific details about the SME, Section B explored the issue of the skills which respondents considered to be important when recruiting graduates and finally, Section C addressed the issue of the methods used to assess whether a graduate possessed certain skills. Factual and opinion-related questions were incorporated into the design of each of the sections contained within the questionnaire. Similarly, a combination of both closed and open-ended questions were used. Respondents were required to complete all sections of the questionnaire, irrespective of whether or not they currently recruited graduates. Each of the three sections will now be discussed in more detail.

Section A was designed to provide a basis for qualitative data analysis. Using a combination of nominal and interval data techniques, the section consisted of five questions to provide information in relation to the following variables: . the type of business activity undertaken; . how long the company had been established; . the number of people employed by the company; . whether the company had recruited graduates within the last five years, and if so, how many; . how many graduates recruited within the last five years still remained in the company's employment Section B was designed to ascertain which particular skills the respondent considered to be important when recruiting graduates. The section consisted of 12 questions, 11 of which related to specific skills and qualities, namely motivation, initiative, creativity, organisational ability, written and oral communication skills, teamworking, interpersonal skills, problem solving, leadership, numeracy and information technology. Each of the skills and qualities listed were followed by a short definition. The skills listed and their definitions were taken from secondary data research findings, namely the AGR report (1995), Harvey et al. (1997) and TNTU Careers and Employment Service. Against each of the skills listed, the respondent was required to indicate the degree of importance using a five-point Likert Scale, thus providing ordinal data. The scoring on the scale was stated at the beginning of the section, i.e.: 1 = not at all important (e.g. would never be a skill required within the company); 2 = below average importance (e.g. would be useful but not a desired skill); 3 = average importance (e.g. would ideally like graduate to possess this skill); 4 = important (e.g. would expect graduates to possess this skill); 5 = very important (e.g. would be an essential skill required). The last question in this section provided the opportunity to gather some qualitative data by inviting respondents to comment on any other skills or attributes that they considered to be important in the recruitment and selection of graduates. Section C comprised three questions, adopting a combination of nominal quantitative and qualitative inquiries. The section required respondents to indicate which methods of selection they use (or would use if they were ever to recruit graduates), in order to assess whether a

The questionnaire design

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potential graduate recruit possessed the skills which they had rated highly in section B. Question 18 listed a range of selection methods, inviting the respondent to tick the methods applicable and, in some instances specify tests used. A tick box labelled ``other'' was added to the list to enable respondents to state any method used which was not offered by the questionnaire. Question 19 required the respondent to indicate whether job descriptions or person specifications were used in the recruitment and selection process by simply circling a ``yes/no'' option. Finally, question 20 invited the respondent to make any other comments in relation to the recruitment and selection methods that would apply specifically to graduates.

Provide examples of why the skills stated are considered to be important. Explain how they assess the possession of skills in the recruitment and selection process. Describe and provide evidence of any formalised procedures and policies they use in the recruitment and selection process.

The second phase of the research design consisted of conducting five interviews, three with SMEs and two with large organisations, all of whom currently recruit graduates. The key reason for supplementing the postal survey with interviews was to explore ``the how and why''. The questionnaire had been designed to provide an insight into what skills respondents considered to be important, but the design did not address the question of why certain skills were deemed to be important. As Burgess (1982, p. 107) states, ``the interview provides the opportunity for the researcher to probe deeply to uncover new clues, open up new dimensions of a problem and to secure vivid, accurate inclusive accounts that are based on personal experience''. The interview was planned adopting a semi-structured approach, i.e. only the main areas for question being pre-planned. However, as the first phase of the primary research had been more geared towards a structured approach, it was considered that conducting a semi-structured interview would provide more in-depth, and meaningful data, with the prime aim of the researcher not influencing the interviewee to the same extent as the questionnaire. A decision was taken, therefore, not to prompt the interviewees by providing the transferable skills and qualities listing, which had formed Section B on the questionnaire, at the beginning of the interview. The resulting structure for the interview was to ask the interviewees to discuss the following areas: . Specify (unprompted) which skills they consider to be important in the recruitment and selection of graduates.

Primary research design the second phase

The interview concluded with the interviewer presenting the list of transferable skills and qualities and asking the interviewee to rank them in importance, and furthermore provide the opportunity to discuss reasons why certain, if any, skills had been omitted in the previous discussion. The method of semi-structured interviews, using a small sample, attempted to focus on potential variation in meanings in order to understand, in more depth, what was happening in the area of graduate recruitment and selection. The interviews, therefore, attempted to establish different views in relation to the importance of transferable skills and qualities.

Research findings
From the random sample of 200 questionnaires distributed to SMEs, 30 responses were obtained resulting in a 15 per cent response rate. The rate achieved was higher than the average 10 per cent baseline advocated by Jankowicz (1995, p. 246). From the initial analysis a decision was made to compile multiple data tables and bar charts in order to make the following comparisons: . Compare the rating of the transferable skills and qualities between those SMEs that have recruited graduates and those that have not. . The size of the SME (in terms of the number of employees) in relation to those companies that have recruited graduates and those that have not. . The age of the SME in relation to those companies that have recruited graduates and those that have not. . Compare the methods of assessment used in the recruitment and selection process between those companies that have recruited graduates and those that have not. . Compare the use of job descriptions and person specifications within the recruitment and selection process between those companies that have recruited graduates and those that have not.

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To make the business activity analysis meaningful, the responses given were categorised using broad industry sectors. The highest response rates were achieved from the manufacturing and construction sectors. However, on examining the sample of 200 companies surveyed, 83 companies fell into these categories; a factor which could explain the higher proportion of returns.

The business activities of respondents

The age of the responding companies was predominantly below 40 years, with 23 of the 30 respondents (76 per cent) falling into the categories of 40 years or less. The most dominant age group was 21-30 years, which represented 46.7 per cent of all respondents. As anticipated, the number of employees was generally located within the 1-10 or 11-20 brackets; these two brackets accounting for 50 per cent (15) of the total responses. However, eight respondents indicated they employed between 41-80 members of staff.

Number of years companies had been established

Number of employees

Of the total number of responses (30), nine companies (30 per cent) indicated that they had recruited graduates within the last five years. These nine companies stated that they had employed 27 graduates during this same period. When asked how many graduates were still employed, five of the nine respondents indicated a slight reduction in the number. Overall, however, the fact that 18 graduates remained with the SMEs would seem to indicate a healthy retention rate.

Number of graduates recruited within the last five years and number of graduates retained

The questionnaire asked respondents to provide qualitative data in relation to any other skills, qualities or attributes not listed on the questionnaire but which were considered important within the context of graduate recruitment and selection. In total 22 responses were provided, which covered a wide-ranging number of issues. Of particular interest, four respondents indicated the importance of the candidate demonstrating practical skills/aptitude. Other comments included: ``attention to detail'', ``positive work ethic'', ``good time keeping'', ``caring and commitment to helping others'', ``common sense'', ``world and local awareness'', ``good memory'', ``likeable personality'', ``broad based knowledge and the ability to adapt knowledge to `real world' situations''. One respondent indicated that ``All the skills listed are vital. The absence of any would seriously limit the person's usefulness''. In the main, this particular question provided some useful data, with comments obtained such as ``exam results are not so important'', and ``realistic expectations of career progression within SMEs''.

Other skills, qualities and attributes considered important

Overall, the ratings awarded to the transferable skills and qualities were located towards the important/very important end of the Likert Scale. This would seem to indicate that such skills are valued by SMEs. It is interesting to note, however, that motivation was the only quality against which all respondents indicated a rating of 4 (important six respondents) and 5 (very important 24 respondents). Similarly, it was interesting to note that leadership, numeracy and information technology resulted in a wider range of values being indicated. The results obtained for these four skills and qualities are shown in Figure 1.

The rating of transferable skills and qualities

Figure 2 illustrates that respondents indicated a number of different methods are used to assess the possession of those skills and qualities rated highly in Section B of the questionnaire. The responses would seem to indicate that the interview is the most popular method adopted, with 27 of the 28 respondents indicating such. (Only 28 responses were obtained for this particular section as two of the respondents did not tick any of the options listed.) Of the 27 who indicated the use of the interview, 24 indicated the number of people involved in this method (three respondents did not indicate how many people were involved). The numbers involved are summarised and presented in Table I. One respondent also indicated that a presentation would be used in the assessment process. Overall, the responses obtained seemed to indicate that decisions relating to graduates' skills and qualities would not always solely depend upon the interview performance, with the use of tests being adopted to support the interview.

Methods used to assess whether a graduate possessed certain skills and qualities

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Figure 1 Rating responses for motivation, leadership, numeracy and IT

Figure 2 Methods used to assess the possession of skills and qualities

The use of job descriptions and person specifications within the recruitment and selection process
Twenty-seven of the 30 respondents (90 per cent) indicated that a job description was used when undertaking any recruitment and

selection activity. The use of person specifications was, however, more varied. Only 14 of the 30 respondents (46 per cent) indicated the use of person specifications. This finding could suggest that, despite such strong emphasis having being indicated in

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Table I Number of people involved in the interview process Number of people involved in the interview process 1 1 or 2 2 2 or 3 3 6 Number of respondents 2 1 13 3 4 1
.

development and marketing company) accounted for the rating of four of these skills, with the exception of written communication. Companies that had not recruited graduates produced results across all five points on the Likert Scale. Five of the skills/qualities were attributed ratings of 2 (below average importance) or below. Leadership, numeracy and IT all received a rating of 1 (not at all important). These ratings were given by five of the respondents.

relation to the rating of transferable skills and qualities, the use of a person specification was not deemed either necessary or appropriate to document the essential and desirable skills and qualities. Alternatively, the finding could suggest that there is a lack of awareness with regards to the use of such frameworks within the recruitment and selection process.

Again, it could be suggested that these skills are rated low in relation to the recruitment and selection of graduates because they are already provided by existing staff within the organisation. Hence, a graduate may not be perceived as the sole means of providing such skills and qualities.

Findings and analysis from the comparative multiple bar charts

Multiple bar charts were produced to provide a means of comparing results between those SMEs that had recruited graduates and those that had not. These will now be discussed individually.

Figures 3 and 4 respectively illustrate the ratings of the transferable skills and qualities pertaining to those SMEs that had recruited graduates and those that had not. The key findings relating to this particular comparison are: . Overall, there appears to be little difference in the rating of skills and qualities irrespective of whether or not the company currently employed graduates. . The fact that SMEs not employing graduates generally value all the transferable skills and qualities could suggest that the key skill levels within these organisations are adequate. Hence, there is no perceived need to recruit graduates to satisfy these skill requirements. . None of the companies that had recruited graduates rated any of the skills and qualities lower than 3 (average importance). Only five of the 12 skills/ qualities listed were given a rating of 3 by two respondents, namely organisational ability, written communication skills, problem solving, interpersonal/social skills and IT. One respondent (a product

Comparison of the ratings of transferable skills and qualities

Figure 5 illustrates the size of the SME in relation to whether or not the company recruits graduates. Size is measured in terms of the number of people employed by the company. It would appear from the results obtained that the micro-organisations (i.e. companies employing less than ten) are less likely to employ graduates, with the highest proportion (71 per cent) of non-recruiting SMEs falling in the below 20 employees categories. This could be attributed to reasons such as the perceived cost of a graduate, or the likelihood of the graduate having unreal expectations in terms of salary or career progression.

Size of the SME in relation to whether an SME recruits graduates

Age does not appear to be an influencing factor as to whether an SME recruits graduates. Seven of the nine companies that had recruited graduates are less than 30 years old, but similarly ten of the 21 companies not recruiting graduates fall into the same category.

Age of the SME in relation to whether a company recruits graduates

Figure 6 illustrates that, irrespective of whether or not the SME recruited graduates, a range of methods are adopted within the recruitment and selection process. When the results from SMEs were calculated as percentages of the respective total number of responses (i.e. nine companies which had recruited graduates and 21 companies that had not recruited graduates), a different analysis was obtained. Figure 6 illustrates that, proportionally, SMEs who recruit graduates use a wider

Comparison of methods used in the recruitment and selection process

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Figure 3 Questionnaire analysis chart illustrating rating of skills and qualities in companies which have recruited graduates

Figure 4 Questionnaire analysis chart illustrating rating of skills and qualities in companies which have not recruited graduates

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Figure 5 Chart illustrating the size of the SME in relation to whether companies recruit graduates

range of methods than those that do not recruit graduates. The common ground for both groups, however, is the heavy role that the interview plays in the recruitment and selection process. This could suggest that SMEs perceive interviews to be the easiest, quickest and cheapest method of selection to adopt.

Figure 7 illustrates the use of job descriptions and person specifications between the two groupings. Once again, percentages of the respective total number of responses have been calculated to provide more meaningful analysis.

Comparison of the use of job descriptions and person specifications

Figure 6 Chart illustrating methods of assessment used in relation to whether companies recruit graduates

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Figure 7 illustrates that all companies that recruit graduates indicated the use of job descriptions, whereas 85 per cent of those companies that do not recruit graduates implied such use. The use of person specifications amongst companies recruiting graduates was, proportionally, significantly higher, with only 38 per cent of companies that had not recruited graduates indicating the use of such frameworks within the recruitment and selection process. This could imply that companies that do recruit graduates are more likely to document the skills and qualities which they value than those companies that do not recruit graduates. The findings and analysis deduced from the questionnaire provided the authors with a useful insight into the graduate recruitment and selection activities within SMEs. The survey results indicate that SMEs within the GNTEC area do recruit graduates. Generally, with the exception of numeracy and IT, it would appear that all of the transferable skills and qualities are valued by SMEs, irrespective of whether or not they currently employ graduates. Finally, a range of methods are used within the recruitment and selection process, but predominantly the interview reigns supreme.

purpose of confidentiality the companies interviewed have been renamed. A brief background to each of the companies is provided, however, to provide a context for the interview summaries and discussion which follows. Concluding the article, analysis drawn from the interviews addresses the opportunity to underline the commonality and differences between the interviews and allow speculative discussion to be made in relation to explanations and implications.

Background to the companies interviewed Company X

Company X is a direct mail marketing business, established 24 years ago. Work is undertaken on behalf of manufacturers, mail order houses, financial institutions, local authorities, public utilities, advertising agencies, printers, PR agents and many other varied and specialist users of direct mail. The company employs between 51-80 staff and has recruited two graduates within the last five years.

Company Y

Research findings second phase

The findings and analysis from the second phase of the research, namely the interviews which were carried out with graduate recruiters from three SMEs and two large organisations, will be presented. For the

Company Y is a well established, familyowned building company, which has been established for 29 years. The company specialises in all aspects of building services and maintenance contracts including plumbing and bespoke joinery. The majority of the company's work is from repair and maintenance contracts, which are undertaken throughout the UK. The company employs 85 staff and has recruited and retained one graduate within the last five years.

Figure 7 Chart illustrating the use of job descriptions and person specification in relation to whether companies recruit graduates

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Company Z provides information technology solutions and offers a comprehensive range of services, including consultancy, systems design, development and integration, support, project management, infrastructure, implementation, training and systems engineering support. It is a relatively young company, established 16 years ago, and employs over 200 employees. During the past five years, the company has employed and retained 13 graduates. Company A is one of the UK's leading brewers, providing outlets in countries worldwide, with a range of leading beer brands. The interview was conducted in one of its core business divisions, which had developed its own graduate training scheme. The division's graduate programme claims to its potential graduate applicants that it:
. . . allows you to maximise your skills and access the diversified range of choices within the organisation F F F [the scheme] is all about developing the business managers of the next century.

Company Z

Company A

Within the division of Company A approximately 12 graduates are recruited per annum. Company B is a UK-renowned precision engineering organisation. The graduate recruitment and development literature describes the organisation as:

Company B

. . . a global company providing innovative and cost-effective engineering solutions to meet our customers' specific needs.

Skills and qualities considered important in the recruitment and selection of graduates. The interview commenced with the managing director (MD) highlighting the fact that there was a perceived lack of management skills within the company, up until the time he took over. He referred to his attempts of ``building the company'' and ``having better skills'' to enable the company to grow. The specific areas of the business in which he aims to recruit graduates are account handling, customer service, finance and marketing. The skills and qualities he referred to as being important when recruiting and selecting a graduate were problem solving, decision making, initiative, being a selfstarter, organisational ability and being able to work under pressure, having an attention to detail, lateral thinking, teamworking, verbal and written communication skills. He also emphasised the importance of a graduate being able to fit in, which he linked to teamworking. No explicit reference was made to interpersonal/social skills, leadership, numeracy or information technology. It was interesting to find, however, that when he was asked to rate the skills and qualities taken from the phase 1 questionnaire, the following ratings were given: . interpersonal/social skills 5; . leadership 2; . numeracy 4; . information technology 4. Other factors influencing the decision to recruit a graduate were also given. A ``reasonable degree'' was referred to as being acceptable. Emphasis on ``someone who is a little more streetwise'' was considered more desirable than a ``top quality degree''. Reference was also made to ``a lot of graduates have an over-inflated opinion of themselves and their work''. Hence, a preference to recruit graduates who had between six to nine months' work experience following graduation, ``when they've been in the job market for a while they become a bit more realistic about their expectations''. Why are the skills and qualities cited considered to be important? The importance of decision making was justified on the basis of the ``open management style'' which prevailed within the organisation. He also stated that ``I don't think individuals learn if the decision making is taken away from them''. Initiative was emphasised as important because individuals were expected to work unsupervised and reference was

Interview with managing director company X

During 1993/94 there was no graduate intake throughout the company. In 1995, graduate recruitment resumed and a manager was appointed to review the graduate recruitment and development process across the company. Graduate intake has since increased and, during 1997, 120 graduates were recruited across all UK sites. The summaries relating to the SME interviews were structured adopting a framework provided by the three key questions that the interview aimed to address, namely: 1 Which skills and qualities are considered important by recruiters? 2 Why are the skills and qualities cited considered to be important? 3 What recruitment and selection processes are adopted by recruiters to assess those skills and qualities that are considered important?

Interview summaries

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made to the ``need to be able to show their ability, in terms of working unsupervised, to generate their own work, rather than expect to always be given a task''. This latter example was also linked to the individual needing to be motivated or a ``self-starter''. Working under pressure was linked to the fact that graduates would be expected to ``deal with a lot of issues simultaneously, rather than focusing on just one particular problem''. The likelihood of dealing with ten or 20 jobs at any one time was cited as an example. Verbal communication was considered important because of the expectation that coherent presentations to customers would need to be made. Written communication skills were considered essential in composing a ``good, well structured letter'' to customers. Attention to detail was similarly valued in relation to customer service:

the first interview, and any testing would be carried out at this stage. The first two interviews would be conducted by the appropriate line managers, with the MD sitting in on the second and third interviews. The third interview would be with one candidate, to whom it was intended to offer the job. This third interview would involve the individual spending half a day in the office ``for them to see us and for us to have another look at them and to see how they fit in''. The reason for this was given as:

Because, you know, it is very difficult to ascertain from an interview whether they are the right person and it's a big commitment both from our point of view and their point of view.

. . . if there is a slap-dash approach that will reflect itself in their attitude towards dealing with customers and, at the end of the day, we want to basically pride ourselves in giving exceptional customer service and exceeding our customers' expectations.

No scoring systems were applied in the interviews, ``we do write notes F F F we don't really have a formal structure or interviewing procedure''. The MD claimed:

What recruitment and selection processes are adopted to assess those skills and qualities that are considered important? He stated that the company had used psychometric testing within the selection process. The reason for the use of psychometric tests was to establish their problem-solving abilities and to ascertain ``job suitability''. Additionally, reference was made to the use of the Belbin questionnaire to establish team roles. This was used to gain an insight as to how the applicant ``would fit into a team''. Attention to detail was examined by close scrutiny of the individual's CV. He claimed:
It is often difficult at an interview to dig out what their attention to detail is really like you have to look closely at how they've prepared their CV and the letter they've written.

I do try to be very objective, but I think that it is only natural that when you see someone walking through the door, how they speak and communicate with you, you will feel this is someone who I want to put on the shortlist but you then question that person in such a way to either confirm or disconfirm that initial first impression.

The absence of formal systems and procedures within the context of recruitment and selection was acknowledged as a potential problem ``so we should probably be a bit more detailed but we don't have a trained personnel manager here''. Skills and qualities considered important in the recruitment and selection of graduates. The skills and qualities she referred to as being important when recruiting and selecting a graduate were the ability ``to fit in'', personality, general intelligence, initiative, mature attitude, confidence, motivation, teamwork, verbal and written communication skills, numeracy and IT. No explicit reference was made to creativity, organisational ability, interpersonal/social skills, problem solving and leadership, although subtle links to some of these areas were made. With the exception of leadership, the ratings given to these skills and qualities, however, again using the questionnaire from the first phase of the research, were high: . creativity 4; . organisational ability 4; . interpersonal/social 4; . problem solving 4; . leadership 1. She associated motivation, initiative and the possession of a mature attitude to the notion of organisational ability. Similarly, she

Interview with office manager, company Y

This examination of the CV and covering letter was cited as being used as the first stage of the selection process. This examination would be carried out alongside a ``job specification'' and a list of ``the ideal qualities that a person would have to fulfil that job'', in order to produce a shortlist of candidates for interview. Two or three interviews would be conducted. The job description would be issued to candidates at the first interview, ``while they are waiting to be interviewed so that they know what the job will entail so they are able to ask sensible questions at the end''. The second interview would usually consist of three candidates, shortlisted from

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associated general intelligence to problem solving and a mature attitude to interpersonal/social skills. Another factor influencing the decision to recruit a graduate was also stated. Previous work experience was not deemed preferable, with a ``fresh graduate'' being favoured ``because we wanted them to just come in and adapt to our way''. However, the expectation that they would have undertaken some parttime work experience while at university, was valued. Why are the skills and qualities cited considered to be important? The ability ``to fit in'' was considered to be important due to the close proximity in which everybody works and, hence, the close liaison between functions. Initiative was justified on the basis that everyone worked on monthly deadlines and everyone was expected to plan their own days to meet these deadlines:
So you've got to be able to come in and knuckle down and get on with it yourself and sort the queries out as you go along and not just sit back and expect to be told.

The need for a mature attitude was associated with the culture of the company, ``you need a certain degree of professionalism here F F F Some people have taken advantage of the informality''. Self-motivation was connected with the need to use initiative because of the requirement placed on individuals to plan their own day. Additionally, however, motivation was linked to the notion of promotion within the company, with a clear statement that ``we do promote from within a lot'' and ``if you weren't motivated and just sat back and did the minimum amount you just wouldn't get recognised or noticed''. Teamworking was emphasised as being crucial because of the work committees to which members of staff belong in order to solve and sort problems; ``in terms of teamwork you've just got to get in there and sort it and push ideas forward and improve things for us''. Effective communication was considered vital with regards to both internal and external customer relations. Similarly, IT was deemed vital ``I don't think we would look at anybody who didn't have basic computer skills''. Computer literacy was required to operate word-processing packages and the in-house accounting system, which everybody needed to operate at one level or another. The accounting IT system also required basic numeracy skills, in order to produce graphs and charts for customer status reports. What recruitment and selection processes are adopted to assess those skills and qualities that are considered important? The

recruitment process relies upon job centres and advertising in local newspapers, with adverts always requesting that candidates submit a CV together with a hand-written covering letter. Very basic information was cited as being entered into the advertisement, with no reference made to skills and qualities. She acknowledged that the vagueness of the advertisement did leave it open to all sorts of people applying, which had probably led to the company receiving so many applications in the past. She admitted that, within their selection interviews, questions asked made no attempt to assess the possession of the skills and qualities. The assumption was made that the possession of a degree meant candidates would have all the necessary skills and qualities and ``it would just be a matter of them being the right person''. A somewhat shamed statement in light of this admission was made: ``it sounds appalling now that I've said all those things and then we don't even test for them''. Shortlisting for interview was made using the letters and CVs submitted, with reasons for instant rejection being given as ``anyone who hadn't signed, dated or hand written the letter''. Checks were made for the right qualifications, and previous work experience. Only one interview was used in the selection process, with involvement of three members of staff being the norm. Interviewers used a grid, marking candidates out of ten across seven areas, namely: first impression, conduct in the interview, quality of answers, appearance, speech, general personality, general intelligence. Job descriptions were issued to candidates at the interview. Person specifications were not used in the recruitment and selection process. She produced samples of job descriptions and the grid used in the interview, together with examples of the types of questions that had been asked. Skills and qualities considered important in the recruitment and selection of graduates. The skills and qualities referred to as being important when recruiting and selecting a graduate were: oral and written communication skills, team membership skills, organisational skills, analytical skills, decision-making skills, verbal and logical reasoning, numeracy, leadership and motivation. Throughout the interview reference, whether direct or indirect, was made to all of the skill areas contained in the questionnaire. The only one which did not receive explicit reference was IT. It was established, however, at the end of the interview, that owing to the nature of the

Interview with owner-manager, company Z

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business, it would be expected for any individual to have strong IT skills. The lowest score awarded to any of the transferable skills and qualities listed on the questionnaire was 3 (average importance) which was attributed to interpersonal/social skills. Why are the skills and qualities cited considered to be important? Oral and written communication skills were considered vital as everybody in the company has customer interface. Particular emphasis was placed on the sales and marketing teams being able to make persuasive, coherent and wellstructured presentations to customers. Teamworking was justified on the basis that everybody within the company works in a team ``we have no one individual in our company who works on their own''. An example was provided in relation to the sales and marketing of a product, where the appropriate team would be expected to produce a business plan, sort out financial implications and present their marketing ideas to the owner/managers. Reward management was also based on team performance ``so from a motivational point of view they get paid as a team''. The requirement for organisational skills was based on the autonomy given to employees to organise their working day. Reference was made to there being a lot of trust on behalf of management for employees to organise themselves. Nevertheless, control was similarly referred to within this context:
. . . if they are doing something that they shouldn't then we do find out F F F we always find out because we can tell because they all have targets.

Analytical skills were deemed important from a sales point of view to ``analyse the customer's problems F F F break the project down bit by bit, and analyse each bit in detail and decide how we are going to approach it''. Similarly, decision making was linked to analytical skills and the area of customer service, with an example cited when individuals would often have to make customer-related decisions in the absence of their managers, ``as long as they can back the decision up then nobody has a problem''. Numerical skills were believed to be important:
. . . because everybody within the organisation deals with numbers whether it's numbers in programming, numbers in quoting people, numbers in purchase and sales ledger and we need to ensure they can add, subtract, divide, etc.

``in order for anyone within our organisation to get on they have to push themselves''. The use of the phrase ``pushing themselves'' was explained as ``taking control of situations and getting people to follow them and support them''. What recruitment and selection processes are adopted to assess those skills and qualities that are considered important? Recruitment activities are undertaken in various ways, namely: via agencies, advertisements in magazines and local newspapers, and via careers offices within universities. Reference to skills and qualities are made within job advertisements, plus a good degree. Candidates are invited to apply by forwarding a CV and covering letter, together with a passport-sized photograph, ``just so we can have a look''. She considered the quality of the CV and letter provided a good insight into the candidate's written communication skills. The CVs and letters are used to shortlist candidates for interviews. Three interviews are conducted, the first interview involving solely the line manager. From this first interview, candidates are shortlisted for a second interview, which usually involves a panel of three members, the line manager plus two senior directors. The personnel officer will also become involved at this stage, conducting the Saville and Holdsworth psychometric tests, which are chosen in accordance with the vacancy. Only one candidate from the second stage interviews will go forward to the final, third, interview. This interview is considered to the ``contract and salary negotiation stage F F F because within the industry no two packages are alike''. At this final interview, the company still retains the option to reject the candidate, although such rejection is unlikely. Job descriptions are used within the recruitment and selection process, once again being issued to candidates at the firststage interviews. Person specifications, however, are not used. Evidence of the range of Saville and Holdsworth (S&H) tests that were used to assess candidates were provided, with the owner-manager reiterating that selection of the various tests would ``depend upon the type of job being filled''. A fully documented report on a successful candidate summarising the results of the S&H tests were also provided.

Interview with personnel projects manager, company A

Leadership and motivation were two qualities that were cited as being important in terms of promotion within the company

Potential graduate recruits are assessed against a well-documented set of skills and qualities, which are categorised under four generic headings, namely: communication skills, information processing skills,

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structure (e.g. planning/organising) and drives. The skills and qualities listings are derived from the group resource. This equates to director level within smaller companies and senior management level within larger organisations. Recruitment of graduates is aimed at selecting those candidates who demonstrated these skills and qualities, with the aim being that they will be promoted to group resource senior positions within 10-15 years. When questioned about the ability to recruit and assess candidates accurately in terms of their future career positioning he admitted:

wash up session at the end of the second day. A score of 1-5 is given for each activity. Any individual who receives 1s or 2s is rejected and not discussed by the panel.

Yes, it's difficult and again this year we are having a debate about whether we can really do that can we really measure what someone is going to be like in 10 or 15 years time.

During the entire interview, he talked through the recruitment and selection process, referring to well-documented guidelines for interviewers and assessors, and considered that the process was ``about as objective as you can get it and it does pick out these sort of inherent skills''. Company A's application form incorporates two skills, namely initiative and influencing skills, which are referred to as priority assessment items. Other priority assessment items include degree classification which should be 2:ii or higher, and possession of GCSE English and Maths at Grade C. A company sift form, is used by assessors to shortlist candidates for a first interview. Answers given on the application form against the two skill areas are rated and categorised as either a ``fail, marginal, acceptable or superior answer''. Similarly, work experience, interests and languages are rated using the same categories. First-stage interviews are conducted using behavioural criteria-related questions, which are split into five categories: analytical thinking, initiative, impact and influencing, commitment to achieving results and curiosity. The same award/ratings are given to answers provided, with usually two questions within each category being given to candidates. Candidates who achieve an overall recommendation of acceptable are invited to the final assessment, conducted over two days at an assessment centre. The two days involve a range of group and individual exercises and final interview, all of which are structured to enable an assessment to be made against each of the competencies. The results from all the activities conducted are summarised on a matrix for each candidate and discussed by all of the interviewers and assessors in a

Graduate recruitment and selection was once again well documented within this organisation. With regard to the assessment of candidates' skills and qualities, a list of personal qualities was referred to, which included; intellect, leadership, interpersonal qualities, achievement and drive, functional expertise, learning, personality, awareness, marketing and change agent. Like company A, each of the personal qualities were defined for the purpose of selection activities. The interviewee explained that the qualities had been derived from senior management competencies. Graduates recruited onto their scheme were expected to progress rapidly within the organisation, spending one year on the training scheme. These qualities provided the basis for assessment within the selection process. The emphasis of the qualities would vary depending upon the discipline for which the candidates were being recruited. Examples of how some of the qualities were assessed included: . Intellect was ascertained from A-level results, degree performance ideally a 2:i or higher being preferred, and also measured by tests undertaken in the assessment centre. . Leadership was examined by the group exercises undertaken and drawing upon past experiences within the interview. . Functional expertise was described as being ``nice to have'', and learning was referred to as ``something we would want to develop in-house''. Recruitment activities are undertaken twice a year, with the traditional intake commencing in September, but with experienced graduates, i.e. graduates with 1-2 years' work experience following graduation, starting in March. The selection process was described as commencing with an evaluation of CVs against person specifications. Shortlisted candidates would then be invited to a screening interview with a senior manager. Successful candidates from this stage would be invited to an assessment day, with a range of aptitude tests being adopted, namely verbal/numerical reasoning, personality tests, role play, observed group discussions, and a written exam based on information which candidates had received prior to the assessment day. The day would also include a final interview.

Interview with head of personnel quality and systems, company B

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He concluded the interview mentioning a ``move away from the traditional milkround''. It was considered that the university industrial placement year provided a legitimate means of recruitment and would become a focus for the future. This concluding section of the article will focus on the commonality and differences that underline the interview summaries presented. In order to provide consistency in structure, this analysis will adopt the same framework that applied before, namely: What skills and qualities are considered important? Why are these skills considered important? How is the possession of skills assessed in the recruitment and selection process?

Interview analysis

An interesting finding, which was noted while the interviews were being conducted, was the difference between the SME interviewees' and larger organisation interviewees' approach to discussing the various skills and qualities. The interviewees within the SMEs talked openly and freely about skills without any reference to documentation. The larger organisation interviewees, however, had to hand welldocumented sources, which provided the focus for the entire interview. This finding could be attributed to the fact that the SMEs interviewed did not have their recruitment and selection practices documented and, therefore, reference to such issues being discussed relied upon the interviewee retrieving information purely from memory. With the larger organisations, however, it felt that if the graduate recruitment literature had been removed from the interview table, the discussion surrounding the issue of skills and qualities might have been less fluent and structured. Common to all the SME interviews was the importance placed on motivation, teamwork, verbal and written communication skills and organisational ability. Similarly, no explicit reference was made to the importance of interpersonal/social skills during the interviews, however, at the end of the interview when the listing of skills and qualities was placed before the interviewees, high ratings were awarded. With the exception of leadership, any skill or quality not explicitly highlighted during the interview similarly received a rating of 4 or 5. This confirmed a suspicion that the questionnaire survey conducted in phase 1 of the research may have significantly influenced responses, i.e. the respondents

What skills and qualities are considered important?

rated highly skills and qualities that they would not necessarily seek within the recruitment and selection process, but that is not to say they are not valued within the workplace. The decision, therefore, not to prompt interviewees using the skills and qualities listing proved to be correct in providing more accurate findings. It is felt that if a listing had been offered to the SME interviewees the dialogue would have been more likely to mirror that of the large organisations. Generally, the language used to describe the skills and qualities valued by recruiters was similar. Some language differences were found, for example, the managing director of company X referred to candidates having to be self-starters as opposed to being selfmotivated. Similarly, there was reference made by all the SME interviewees to the importance of potential graduates being able to ``fit in'', which was linked to teamworking skills. Only company Y linked this idea of ``fitting in'' to the notion of culture within the company. With the SMEs, the discussion surrounding ``what skills are considered important'' provided examples of overlap between the skills headings used on the questionnaire, for example, the notion of problem solving was considered to encompass decision making, analytical skills, lateral thinking, working under pressure and initiative skills by companies X and Z. Other factors cited as being considered important by SMEs also led to differences being highlighted. For example, company X, preferred a graduate who had been in fulltime employment for six to nine months, whereas company Y preferred a ``fresh graduate''. Company Z similarly preferred ``a fresh graduate who we can nurture into our environment'' and reference was made to previous experienced graduates ``bringing lots of bad habits and pre-conceived ideas''. Only company X made any mention of degree classification being considered, and stated that ``a reasonable degree'' would be considered appropriate and once again expressed more concern for the candidate to be ``streetwise'' as opposed to possessing a high calibre degree with no previous work experience. Only company Z rated highly leadership linking this quality as being vital to promotion and success within the organisation. Companies X and Y gave a rating of 2 and 1 respectively to this quality. This finding could be attributed to a couple of factors. First, company Z was the largest SME interviewed employing over 200 staff.

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The size of the organisation could reflect the likelihood of perceived promotion opportunities. Hence, this company may consider that promotion opportunities and a career structure exists within the organisation, and as a result wants to recruit managers for the future. This is similar to the approach undertaken by the large organisations. Second, companies X and Y may not consider it necessary for new graduates to demonstrate leadership qualities because such qualities may already sufficiently exist within their organisation. The MD of company X, in particular, did express concern regarding ``fulfilling the graduates' long-term aspirations''. He considered that because his company did not possess a ``big hierarchy'' there was ``no natural career ladder progressions''. This concern, therefore, could also be attributable to the apparent lack of concern for graduates to demonstrate leadership qualities. The listings provided by the large organisations, similarly contained reference to the same skills and qualities, but with different generic headings adopted by each organisation. For example, company A cited communication skills as a generic heading, which includes communication/ persuasiveness, teamwork and interpersonal skills as sub-headings. Company B, however, did not list communication skills as one of its personal quality headings, but refered to this skill in its definition of the personal quality achievement and drive. The listings provided by the two large organisations would, therefore, seem to suggest slight differences in skill and quality definitions. An interesting difference between the two organisations' skills and qualities listings is that company A refers explicitly to teamwork and emphasises contributing effectively as a full member of a team, but does not refer to leadership. Company B, however, refers explicitly to leadership and cites ``building teams'' in its definition of leadership. Company B lists intellect as one of its personal qualities and a preference for a degree classification of no less than 2:i. Company A, however, stated that a 2:ii classification was deemed acceptable. It would appear, therefore, that differences in preferred degree classifications exist, however, both of the large organisations interviewed considered a third-class honours degree to be less acceptable. In general, from the interviews conducted, it would appear that SMEs seek similar skills and qualities when recruiting graduates as large organisations. It is the language used to describe some of the skills and qualities that provides the difference.

It was quite apparent from the interviews conducted with the two large organisations that the skills and qualities had been derived from senior management competencies, and hence the focus was on recruiting new blood with similar skills and qualities. This inferred that both organisations were aiming to recruit and develop future senior managers. Company Z similarly recruited graduates with the expectation that these candidates would possess the necessary skills and qualities to become future managers. Reference was made during the interview with this company to ``graduates recruited in the early days'' were now in management positions and recruiting graduates themselves. This similarity may be attributed to the fact that this was the largest SME interviewed. Alternatively, or additionally, the nature of the business may be a factor that influences the forward planning confidence which seemed to be associated with the recruitment of graduates. The IT industry is experiencing rapid growth and the owner-manager stated that the company selected graduates who ``want to be very, very successful''. She added that ``We will say to graduates, `look you come to us, we are a small company grow with us and your career will grow'''. This desire for success was linked to graduates being motivated by money and it was acknowledged that:

Why are these skills considered important?

We ask direct questions like ``what motivates you?'' and one of the answers that we like to hear is money. We like them to tell us that money motivates them because being in the industry that we are in you can earn an awful lot of money at a very young age and an awful lot of graduates, straight from university, are hungry to earn more money. So that is a quality that we would definitely look for in our sales people greed.

The other two SMEs recruited graduates more in hope than expectation that they would remain with the organisation, and, therefore, demonstrated less confidence of graduate retention than company Z and the large organisations interviewed. All three SMEs, however, provided examples of why the skills and qualities were considered important which seemed to indicate a requirement for the graduate to ``hit the ground running'', with motivation and initiative, in particular, being commonly linked to the need for individuals to work unsupervised and accept responsibility for decisions made and actions taken. This is in contrast to graduates recruited by the larger organisations, where one-year to 18-month training schemes are the norm. Company Z,

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however, did make reference to training costs of 8,000 to ``get them up to our standards'' and stated that ``if they leave us within two years they have to pay a quarter of that back''. This latter statement could be interpreted to infer that, despite the apparent confidence that the owner-manager demonstrated regarding graduate retention via the offer of promotion and career prospects, expectations that graduates may leave exist, hence a proportion of training costs invested being recouped. Once again, the nature of the industry, i.e. being competitive both for business and resources could be a factor attributed to such actions. The final similarity found between the SMEs interviewed was the reasons given for graduates to possess strong verbal and written communication skills. All three SMEs linked these skills to the importance of both internal and external customer relations.

How is the possession of skills assessed in the recruitment and selection process?

The large organisations adopt very similar recruitment and selection practices to assess a potential graduate's skills and qualities. The process was common to both organisations, with candidate applications being assessed against specific skills and quality requirements in order to produce a list of first interview candidates. Candidates who prove successful at the first interview are invited to an assessment day(s). Both organisations stated that the list of skills and/or qualities issued at the research interview provided the basis for assessment exercises. The assessment day would incorporate a final interview and the results from the exercises/activities and interview would provide the basis for final selection. Slight differences in practice became apparent from the interviews conducted with the two large organisations. First, company B includes a written exam as part of the assessment day programme, but no mention was made of an oral presentation being made by candidates. Company A, however, requires candidates to make oral presentations but do not require candidates to sit an internal exam. This company relies solely upon the graduate scheme application form to shortlist candidates for first interview, whereas company B will also assess the candidate's CV against person specifications in order to produce a candidate shortlist. Company B, unlike company A, recruits graduates at two specific points in the calendar year, with mature graduates recruited to commence in March and newly qualified graduates recruited to commence in September.

The SME interview findings also demonstrated similarities in relation to the recruitment and selection practices. All three companies relied upon applicants providing CVs and covering letters in response to advertisements. Only company Z, however, made any reference to skills and qualities within the advertisements. Company Y was the only company that did not attempt to assess the possession of skills and qualities during the interview. This company admitted, unlike the others, that it assumed graduates would possess such skills and qualities by the very nature of their having achieved degree status. In common with the large organisations, all three SMEs used the interview as part of the selection process. Application forms, however, were not used by the SMEs. CVs and letters of application provided the means by which candidates were shortlisted for first interview. Unlike company Y, which only conducted one interview in the selection process, companies X and Z both conducted three interviews, with the third interview being with the candidate to whom it was intended to offer the job. Both of these companies also conducted psychometric tests at the second interview. The tests used at this stage of the process were claimed to assess the possession of the desired skills and qualities. Similarly, these companies did not involve senior management in the selection process until the second interview stage. All three SMEs stated that they used job descriptions in the recruitment and selection process, and issued this document to candidates at the first interview stage. This would seem to suggest that the companies did not perceive any benefits of issuing the job description to applicants at an earlier stage of the recruitment process. Only company Z used person specifications in the process of selection as a means of shortlisting candidates against their CVs and letters of application, as opposed to being issued to candidates at the recruitment stage. Again, this would seem to suggest that the SMEs interviewed did not perceive any benefits of linking the use of person specifications to the assessment of skills and qualities which they apparently value. This finding could also suggest that SMEs have not considered using either job descriptions or person specifications as a means of providing applicants with an indication of the specific job responsibilities and essential and desirable skills and qualities being sought at the recruitment stage. This was very much reflected in comments made by the office manager at company Y:

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. . . they would get that kind of information when they turned up for the interview F F F I suppose that's a bit too late really, isn't it?

She also conceded that no specific reference to skills and qualities and job detail was made in the advertisements placed for graduates and acknowledged ``so really it leaves us open to all sorts of people, doesn't it?''

Summary and conclusion

Returning to our original research questions, it is apparent that SMEs seek the kind of skills and qualities which are commonly defined as ``transferable''. Indeed, SMEs appear to value those skills included in the definition adopted for this project. That being the case, it seems also reasonable to conclude that our evidence indicates significant commonality with the SME sector and between SMEs and larger organisations. However, there are some differences, especially in relation to the emphasis on ``fit'' within SMEs, and the comparatively lower value placed on ``leadership''. A similar conclusion seems possible in relation to methods of selection. While SMEs are, as might be expected, less sophisticated than large organisations, the use of psychometric tests, presentations and panel and/or sequenced interviews is not unusual and the use of job descriptions appears to be an established practice. Less use seems to be made of person specifications, though assessment and grading criteria for use at interview is again not unusual. Perhaps the most significant difference between SMEs and large organisations is the expectation in the former that graduates will perform and contribute immediately. There is also a sense in our data that this will be required across a wider range of functions, activities and tasks than would be the case

with a large company graduate training programme, at least in the immediate and short term following recruitment. Taken together with the notion of ``fitting in'', which is of importance in the SME sector, this suggests a need to focus on these different requirements in creating accurate ``opportunity awareness'' among undergraduates. The notion of ``fit'' in particular supports the value of our proposed conceptual model which highlights the need to examine ``self'' in relation to ``opportunities''. Our empirical evidence, therefore, suggests practical implications for higher education institutions, graduates and SMEs if the expectations and requirements of each are going to be satisfied in a graduate labour market which, until very recently, operated in response to the demands of large organisations. These implications will be identified and examined in our next and concluding article.

References

Association of Graduate Recruiters (1995), Skills for Graduates in the 21st Century, October, Cambridge. Burgess, R.G. (1982), Field Research: A Source Book & Field Manual, Allen & Unwin, London. Gill, J. and Johnson, P. (1991), Research Methods for Managers, Paul Chapman Publishing, London. Harvey, L., Moon, S. and Geall, V. (1997), Graduates' Work: Organisational Change and Students' Attributes, Centre for Research into Quality, The University of Central England, Birmingham. Jankowicz, A.D. (1995), Business Research Projects, (2nd ed.), Chapman & Hall, London. Stewart, J. (1997),``Data collection methods in training'', tutorial handout, Nottingham Business School, The Nottingham Trent University, September.

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