This is a recuirtment branding   LUFTHANSA: to hedge or not to hedge.. WHAT HAPPENED? • Heinz Ruhnau decided to hedge half of the transaction price using forwards at the rate of 3.20DM/USD. • The DM/USD exchange rate went to 2.3DM/USD by Jan 1986. • Ruhnau was accused of “reckless speculation” with Lufthansa’s money. He faced harsh criticism by both the German Transportation Board and Lufthansa’s Board. In general he was accused of making four mistakes: 1. Purchasing Boeing aircraft at the wrong time – the dollar was at an all time high. 2. Choosing to hedge half of the exposure when he expected the dollar to fall. He should have trusted his instincts and gone for all or nothing. 3. Choosing to use forward contracts instead of options. The options would have allowed Herr Ruhnau to protect himself against continued increases while preserving the flexibility of exchanging DM for dollars if the exchange rate develops according to his beliefs. Unfortunately Herr Ruhnau, as many others, felt that options were too exotic. 4. Purchasing Boeing aircraft at all. The German government (Lufthansa’s major shareholder) had a vested interest in Airbus, Boeing’s main competitor. WHAT DO WE LEARN? The hedging decision is very important. It relies on a thorough analysis of both a firm’s business and financing risk. • What are the direct and indirect costs of different risk management strategies? • The direct costs are relatively straightforward to measure, but the indirect costs are not. What were the indirect costs for Ruhnau? • There is a fine line between speculating and hedging. • The consequences of the decision to hedge (speculate?) can be very serious so we need to carefully weigh the alternatives. • The risk management decision can influence all stakeholders. • External restrictions (e.g. covenants) may impact risk management alternatives.  LUFTHANSA: to hedge or not to hedge.. WHAT HAPPENED? • Heinz Ruhnau decided to hedge half of the transaction price using forwards at the rate of 3.20DM/USD. • The DM/USD exchange rate went to 2.3DM/USD by Jan 1986. • Ruhnau was accused of “reckless speculation” with Lufthansa’s money. He faced harsh criticism by both the German Transportation Board and Lufthansa’s Board. In general he was accused of making four mistakes: 1. Purchasing Boeing aircraft at the wrong time – the dollar was at an all time high. 2. Choosing to hedge half of the exposure when he expected the dollar to fall. He should have trusted his instincts and gone for all or nothing. 3. Choosing to use forward contracts instead of options. The options would have allowed Herr Ruhnau to protect himself against continued increases while preserving the flexibility of exchanging DM for dollars if the exchange rate develops according to his beliefs. Unfortunately Herr Ruhnau, as many others, felt that options were too exotic. 4. Purchasing Boeing aircraft at all. The German government (Lufthansa’s major shareholder) had a vested interest in Airbus, Boeing’

1. Recruitment
• The process of finding and/or attracting applicants for the
organization’s open positions.
• Recruitment decisions are about how to look for candidates, where to
look for candidates and when to look for candidates.
• What factors will determine your Recruitment Strategy?

2. Difference between Recruitment and
Selection
• How does the Recruitment process differ from the Selection process?
• When does Recruitment process end and the Selection process start?

3. Employer Branding: Four Elements
1. Brand Positioning: How the company positions itself as an Employer.
Brand built thru marketing, advertising, websites, career fairs etc.
2. Brand Promise: Has to do with how the company treats the candidate
during the recruitment and selection process, things told to the
candidate at the interview, the way the offer is made, etc.
3. Brand Delivery: When the candidate joins, how is his induction
experience, how does he experience the work environment,
management style, learning and development strategies of the company,
retention strategies.
4. Long Term Value: The company creates long term value for its brand by
using brand ambassadors. These could be famous people associated with
the brand, alumni clubs, employee referrals. Exit interviews and how
they are conducted also leave a lasting image.

4. Employee Value Proposition
• Rational Benefits
• Emotive Benefits

5. Internal Vs External Sources
of Recruitment

6. Internal Sources of Recruitment
1. Job Postings within the organization
2. Transfers and Promotions
3. Rehiring

7. External Sources of Recruitment
1. Internet, Company Websites, Job Portals
2. Social Media
3. Advertising
4. Employment Agencies, On-Demand Recruiting Services, Executive
Recruiters
5. Employee Referrals
6. Temporary Workers, Contractual Workers, Gig Workers, Outsourcing
7. Campus Recruiting
8. Internships
9. Job Fairs
10. Trade Publications, Trade Conferences and Shows
11. Walk-Ins, Unsolicited Applications

8. How will you evaluate your
Recruitment and Selection
Efforts?

9. • Evaluating recruitment costs and benefits – Direct and Indirect costs
• Evaluating time required to fill openings
• Evaluating Recruiting Quantity and Quality
Yield ratios
Selection rate
Acceptance rate
Success base rate
Recruitment and Selection Evaluation