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Case Study of Citigroup

Citigroup started as the single banking firm Citibank in Singapore in the early
part of the 1900s. After a century of operation, Citibank has expanded to become
Citigroup, constituted by Citibank Consumer Bank, City Bank International Personal
Bank, Citigroup Private Bank, Smith Barney Private Client Group, Citigroup Corporate
and Investment Bank, and Citigroup Asset Management. The aggregate of these
banking and financial institutions coincided with the expansion of its market from
individuals to corporations, service offerings from private banking to investment, and
geographic scope with presence in more then one hundred countries. (Ministry of
Manpower, 2004)

As a large multinational corporation, Citigroup places stress on the key role of


recruitment and selection to its success. The thrust of its human resource planning is
the identification and engagement of the correct person. This is especially so in
Singapore since the small population, means limited talent pool and the heightened
competition in Singapore’s financial sector hinders and complicates the recruitment and
selection process. (Ministry of Manpower, 2004)

Due to the human resource challenges, Citigroup devised the recruitment and
selection strategy of drawing the interest of the best and most qualified people. The
outcome of Citigroup’s recruitment and selection process greatly depended on its brand
equity and excellent public reputation supported by its merit-based recognition and
reward system together with its adherence to the concept of diversity. Since Citigroup
values merit, it employs a thorough screening process that considers ability,
competence, experience, integrity, skills and vigilance before making an offer, with the
offer depending on how well the candidate meets these criteria. This enables the
company to executive its human resource plan cost-effectively since nil mistakes occur
in the recruitment and selection of personnel. The company also relies on its previous
experiences and developed best practices to ease its recruitment and selection
process. (Ministry of Manpower, 2004)
In terms of external and internal recruitment and selection, Citigroup engaged in
external sourcing in its new business units located in other countries. However, with
established business units, Citigroup prefers internal sourcing strategy for the
actualization of its human resource plan. Citigroup has decentralized the recruitment
and selection process across its different business units so that every business unit
operating in the different regional clusters have their respective human resource
departments in charge of recruitment and selection. Citigroup has also employed a firm
to manage the resumes of applicants to the firm and use internet services to facilitate
the processing and scheduling for interview of applicants. This led to the development
of a database of possible applicants, which decreases the cost of advertising and
drawing candidates. (Ministry of Manpower, 2004)

This paved the way for the preference of internal recruitment at Citigroup. The
database enabled Citigroup to hire the best people to work its different business units.
As such, it developed the talent inventory review that targets the building and
development of the skills and talents of its hired personnel for them to fill in key
positions in the future. This means that firm personnel who have maintained its
standards end up in the leadership team of Citigroup as managers and executives in the
various business units. The review assesses the personal profile of likely candidates
based on records in the database together with employment qualifications, experiences
and potential. The review happens every year resulting to an inventory of talents. This
offers benefits to various parties. On the part of personnel, the review enables them to
evaluate their performance and extent of skills development so they can adjust career
development goals or targets. This has become an empowering experience for
Citigroup personnel. On the part of Citigroup, the review allows it to create an inventory
of promising leaders, assess its capability for long-term growth and competitiveness,
and compare its leadership capabilities in the long-term with its close competitors.
(Ministry of Manpower, 2004)

Apart from the talent inventory review, Citigroup also utilizes internal job posting.
This works by encouraging all personnel to file their applications for vacated leadership
positions in the different business units after the announcement of vacant or new
positions. This is a standard policy at Citigroup and internal personnel receive
prioritization. External sourcing only happens if there are really no people fit for the job,
which is widely unlikely. (Ministry of Manpower, 2004)

Conclusion
The preference of external or internal sourcing is context-based, with the choice
depending on the needs and requirements of the firm expressed in its human resource
plan together with other business contexts such as the labor market and extent of
industry competitiveness. This means that the choice between external or internal
sourcing does not necessarily mean that one is absolutely better than the other
strategy. In fact, business firms can practice one or the other or both depending on the
need. In the case of Citigroup, it preferred internal sourcing as its recruitment and
selection strategy because of the limited labor pool and the need for technical skills in
its operation. Industry competitiveness and the scarcity of technical skills justified
internal sourcing because of the value of maintaining and developing existing personnel
to take on leadership positions and propel the company towards long-term growth and
further expansion.

References
Chan, W. (1996). External recruitment versus internal promotion. Journal of Labor
Economics, 14(4), 555-571.

Dransfield, R. (2000). Human resource management. Oxford: Harcourt Heinemann.

Ministry of Manpower.2004. Case study series 1/2004: Recruitment and selection.


Retrieved May 21, 2008, from
http://www.mom.gov.sg/publish/etc/medialib/mom_library/Workplace_Standards/f
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Sims, R. R. (2002). Organizational success through effective human resources
management, Quorum Books, Westport, CT.

Spencer, J. D. (2004). Fundamentals of staff development. In N. Bhindi & C. Davies


(eds.), PDAS 313: Fundamentals of staff development resource book. Armindale:
University of New England.