Storing Up Trouble For The Good Times

I saw this in an ad that turned up in my inbox recently.  The ad was for a recruitment manager for a professional services firm:  "You will have had experience in a similar role in a professional services organisation."  Nothing particularly unreasonable or earth-shattering about that, you'd think.

In fact, if you analyse most of the roles advertised in recruitment at the moment, or in many other fields for that matter, the bottom line is that recruiters are looking for candidates who have done pretty much the same job in a near-identical business.  The only reason that the ad I quoted above caught my eye is that it came out and said as much!

Now it's hard to be critical.  Recruitment can be risky, and in a candidate-rich market why shouldn't hiring managers and recruiters be looking for the safest, lowest-risk option available?  In addition, from the recruiters' perspective, candidate selection isn't overly taxing, inasmuch as you are looking for experience on the CV, rather than ability in the individual.

And that's really the point here. Although it's difficult to see from our current gloomy economic perspective, markets do change, and when the labour market tightens, recruiters are going to need something much more creative to get top quality candidates to move.  Why should established employees in one company move to do exactly the same job in another?  When the flood of CVs that used to pour in to job ads is reduced to a trickle, how will recruiters whose role has been simply to filter ad response fare? How well will they cope when assessing candidates on more esoteric criteria than simply what's written on the CV?  How competent will they be at persuading top quality, highly sought after individuals to join their companies in the face of stiff competition from other organisations?

These questions might not be on the agenda for recruiters at the moment.  They should be!

Social Media in Recruitment Isn't Working - Just Ask A Candidate

Another week and another social media conference goes by. Another chance for the ever-increasing number of social media experts to tell recruiters how to attract and engage with candidates, create talent pools etc.

But here's the problem.  In this avalanche of 'this-is-what-you-should-be-doing' information, who is representing the views of the candidate? In the social media recruitment equation, candidates are customers and they have a voice.  They are the ones who need to be attracted and engaged with. Which companies ignore the opinions of their customers? Well, in recruiting terms, it seems most of them.

I am currently a candidate looking for a job, so I have some real insight into the motivations of job-seekers, and what companies are offering in the social media recruitment space. And, frankly, from the candidate perspective, the scene is not good.   There are some real problems to overcome.

Communications

• Most corporate websites are firmly in the grip of the marketing function. The objectives of the marketing and recruitment arms of a business with regard to social media comms are different. Candidates do not want to be inundated with corporate PR, but they are.

Content

• Usually a mix of corporate news and retweeted/shared articles which can be found elsewhere.  A lack of genuinely insightful and original content of interest to a potential employee.
• Recruitment output is often limited to tweeting/sharing job postings.  By their nature, most will be irrelevant.

Time Constraints

• People who are out of work want to get back into work quickly.  People who are in work and want to move do not have a lot of time to conduct a search. Job-seekers do not want to have to follow/like/share/link to large numbers of different sites or pages to have irrelevant jobs posted to them.  They want to see lots of relevant jobs in one place. That's why they go to job boards.

Lack of Discretion

• Engagement with social media sites can be in the public domain, and increasingly employers are likely to take a dim view of some of their employees' online contacts. (In the interests of balance, a big tick in the box for Google+ Circles in this regard- but are there really 100 million active users?).

Passive Engagement.  

• There is still a sense that simply having a Facebook page etc will give you a presence and attract candidates, an "if you build it they will come" approach.
• There seems be be a lack of commitment to engage from the employer/recruiter standpoint. The onus is still very much on recruitment as a transaction, and on the candidate to seek out and apply to a role.
• Why, when in such a scenario the recruiter has full access to CV & contact details from many candidates who have shown an interest in the company, is nothing positive done with this information?  Telling unsuccessful candidates to keep looking on the website for new jobs does not convey the idea of an organisation actively committed to building a pool of talented individuals on which to call in future.

Lack of Trust

• Candidates ARE interested in a potential new employer's reputation and culture, but they rarely either look for or get this information from a corporate-sponsored site. A general internet search on corporate reputation is much more instructive.

Corporate Fear

• Candidates, both passive and active, can and do join groups where they can share experiences, information and problem-solving techniques with like-minded professionals from the same sector.  But which corporate is going to sanction a site where it may be sharing information with someone from a competitor company? I haven't seen one.

LinkedIn and Twitter are my major social media of job-seeking choice. I use the LI job board (!), but also in the same way as a recruiter, I can use LI to identify and contact people direct who I think might help with my job search and exchange information that I think is relevant and over which I have some control. The social media recruitment model just doesn't seem to be as targeted.

If I, as an active job-seeker, see no incentive to engage, what chance do companies have of attracting the passive job seeker, that Holy Grail of the recruiting world?

The irony is that all the building blocks for successful social media recruitment programmes are out there.  It is just that nobody seems to be asking the most important people, the candidates, what will attract them in.

Challenging The Orthodox: #2 Recruiters' Fees

A long time ago, back in the mists of time, an executive set up the first ever recruitment business and said, "What are we going to charge for our service?  I know!  We'll charge 30% of the successful candidate's salary."  And so an industry standard was born.

I have absolutely no evidence to support this scenario, other than that it reflects the totally arbitrary nature of the arrangement.  However there are two facts of which I am pretty certain:

• FACT ONE: Recruiters are no more capable of producing a rationale for charging a percentage of remuneration as a fee for their work than....
• FACT TWO: ....employers can produce a rationale for paying it.

Does it reflect the amount of work that goes into the recruitment process? No. For example, recruiting for employers who are lower quartile payers is often more difficult than for those who are upper quartile payers.  But by linking fee to salary, the fee is automatically lower for what in theory will be a more difficult project.  

A difficult job can take longer to fill.  The recruiter's fee may diminish as a result, or exclusivity may be lost. In some cases, the harder you have to work, the less likely you are to get paid at all. Or, conversely, you may make one phone call to the right candidate and fill the position.

In which case, does the percentage model fee reflect the benefit that the client gets from the acquisition? No, because in most cases the employer has no way to measure the contribution an individual makes to the business.  There is no ROI calculation.

Does charging a percentage have any rationale at all?  Actually, yes.  In theory, a more senior position should make a more telling contribution to the business, will be paid more, and thus will be more expensive to recruit than a less senior position.  Intuitively this sounds right, but it is still difficult to prove with raw data.

Many recruiters, including me, have made good money over the years from the percentage model.  But I can't help wondering whether that executive back in the mists of time didn't do recruitment a disservice by introducing this model.  Why? Because it gave employers an excuse NOT to confront the really important question, that is 'What is the value of our human assets?', but instead, in the absence of a measure of value, a simple way of reducing the cost of its acquisition.  

Even if you cannot point to an ROI figure for your recruitment, it is easy enough to argue that the return must go up if the investment goes down.  Picking an arbitrary percentage figure with no business case for justification gave purchasers of corporate recruitment services an easy target to work on, and that figure was only ever going to go one way.

And it assumed that all recruiters provided the same service (because there was no measure of the quality of the service in terms of ROI), therefore good service equalled cheap service.  There are good recruiters, and there are cheap recruiters, but they are not always the same thing!

Work on producing an actual value for human capital is long overdue (which Chairman has not airily paid tribute to "our most valuable asset" at some stage?). But work most definitely is going on - I refer you this article by Jeff Higgins which is a particularly well-developed example.

If such a standard could be achieved then it ought to be possible, amongst many other benefits, for employers to pinpoint which agencies/sources are producing candidates who contribute the most over time, and which agencies/sources provide the greatest ROI irrespective of initial cost. 

By the same token, such data would allow agencies to point to real proof of success; provide a real measure of value add and a firm basis for premium charging; and help to marginalise the cowboys who undermine the market on both cost and quality.

Such an arrangement has great benefits for both employers and recruiters. If anyone out there has any anecdotal evidence of innovative fee arrangements, or companies using sophisticated HR data to value their human assets I would be interested to hear.