What’s wrong with recruitment…and how to fix it!

What’s wrong with recruitment…and how to fix it!

This could potentially be a VERY long post because I’m talking about an industry that has many inherent flaws. In my opinion, many of the problems we see stem from some fundamental issues that recruiters have wrought upon themselves and customers unwittingly propagate.

The paying customers’ perspective

Having been a customer myself and in speaking with countless other recruitment customers, I can tell you that their complaints are very consistent.

There’re a lot of them so I’ll list out the top 10:

  1. They waste my time
  2. They lie to me
  3. They keep hassling me every 5 minutes
  4. Fees are too expensive
  5. Recruiters don’t understand my business or the role
  6. Candidates aren’t even being interviewed before they’re sent to me
  7. They’ve been looking for months and can’t find anyone
  8. Everyone they send to me are terrible
  9. Too many cold calls
  10. I’m sick of junior recruiters who have no idea

The recruiters’ perspective

There’s a pretty similar list of gripes here too:

  1. They waste my time
  2. They lie to me
  3. I have to chase them for everything and they never call me back
  4. They cancel roles and they’ve always got 5 other recruiters working the same role
  5. This role is a $150K investment and they won’t even meet with me to talk about their business or the role in detail
  6. Every time I send a candidate they’re “already on our database” or another agency has just sent them 5 minutes before me
  7. They’ve been looking for months but won’t budge on the spec or increase their budget
  8. They don’t give me any feedback on candidates I send them
  9. There’s no customer loyalty and they always step outside the PSA
  10. I’m sick of ridiculously low PSA rates

And the sad thing here is the true victim of this lack of accountability and partnership – the rather important people – the TALENT!

What’s to be done

It’s tempting to work through each of these issues one by one and talk about solutions but we’d be treating the symptoms, not the core problems.

It seems to me that most problems stem from the bounty hunter style pricing model prevalent in the market where the fee is contingent upon success. With this model the customer has nothing to lose by being non-committal and farming the role out to multiple recruiters.

To draw an analogy, this model is like giving your tax return to 5 accountants and telling them that you’ll only pay whoever gets you the quickest result. If you did that, what kind of result would you get? I bet any accountant worth their salt would turn it down instantly and if you were lucky enough to get a few to agree how would they approach the assignment? They’d rush it, they’d probably cut corners so they don’t invest too much time in case they don’t get paid. Just like you, they’d be hedging their bets.

So when we do the same thing in recruitment a few important things happen. Because we’re dealing with a number of recruiters this soaks up so much time that it’s too much effort to do a proper job brief. In fact it’s too much effort to call everyone back or respond to the CVs they’ve sent. We haven’t spent any money so it’s no skin off our nose, right? Then the follow-up calls start and we get fed up pretty quickly.

The recruiters know how the game works so they’ll make a call on where your role should sit in their priority list. Most good recruiters will successfully place between 25% to 50% of the roles they work. That means they spend their own time and money on 10 jobs but only get paid for 2.5 to 5 of them (sometimes none).

So recruiters usually look at their jobs and think “what can I definitely place?”. This is where the bulk of their time will (should!) be spent. If you’re not a top priority because you don’t return calls or you have too many recruiters working your role, or your fee is too low, or you’ve been looking for ages and you’re not paying enough money… then guess what, you get a half-hearted effort.

More importantly we’re motivating recruiters based on speed, so it’s in their best interests to try to get the best return from the least amount of effort. This encourages what we call a flick and stick, or spray and pray approach. Basically, this means playing the numbers and throwing as many CVs out to as many customers as possible knowing that the law of averages means that something will stick. The scary thing is, this is so entrenched that Recruiter’s KPIs are actually measured and rewarded based on these numbers! I hasten to add not at 33 Talent for this very reason (check out our ROWE article for more info)

 

There is a better way!

I think the solution is to throw out the contingent fee model. Instead, work with one recruiter and pay them a portion of their fee upfront. This commits both parties to getting a quality result and puts your job firmly at the top of the priority list. It means that the recruiter doesn’t have to cut corners to get you a CV before someone else snags the fee. It means recruiters can afford to take on half the number of jobs because they know they’ll get paid for all of them. It means candidates aren’t getting calls from 5 different recruiters and don’t start thinking “jeez these guys (Client X) must be desperate!”. It also usually means you’ll be able to negotiate a discount because you’ve removed some of the recruiter’s risk.

Is this risky for you? Yes it probably is, but in the context of all your recruiting over a number of years, doesn’t it make good business sense to spend time up front picking a good recruiter with good references and a strong track record? Then build a strong, exclusive relationship with them until you get to the point that they know your business better than most of your staff. If they let you down, find another agency. You might have the odd false start but over time you will get much better results and you will absolutely save money.

A common misconception

I once had a customer say “But I’m buying a product, if I like what’s on your shelf then I’ll pay, if I don’t then I won’t”. Sorry, but candidates are most definitely not sitting on a shelf waiting for your call! You’re not buying a product, you’re buying a service. You’re paying for someone to go out to market and represent your business. You’re paying for someone to search high and low, ask for referrals, network extensively and generally do whatever it takes to find you the perfect person.

Having said that, the best recruiters invest heavily in their network so they will often be able to recommend someone they’ve already met. But it’s important to recognise, you’re still paying for a service. You’re paying for someone to successfully broker and secure a long term relationship on your behalf that you can then benefit from quickly. Just because they are in the recruiters network when you ask doesn’t mean a huge amount of time (usually years) of effort hasn’t gone into making that the case

Final thoughts

If you spent $150K (on say a piece of Software) in your business, would you spend a lot of time with a vendor to make sure they really understood what you wanted? You bet! Why is a $150K candidate any different? It’s a big investment and very expensive if you get it wrong so it pays to invest the time with quality partners to make sure you get it right.

At 33 Talent we have built a new suite of models that make this transition easier for clients. One of them, for example, only requires a small proportion up front and then a reduced success fee at the other end which isn’t payable if the Talent comes from an ad as opposed to Search & Networks.  This reduces waste and risk on both sides for a win win.

There is an element of Trust required still sure, but there is in any meaningful relationship in life! Whatever your solution, Clients and Recruiters need to start partnering more and at a deeper level to make sure the ever growing disconnects that also effect the Talent (And therefore Employment Brands) start to be bridged and turned around.

If you want to discuss any of the solutions and ideation around how to make recruitment better for all concerned, please contact us at info@33talent.com or +61 (0)2 9283 6004.

Why I Love Recruiting

Why I love Recruiting

Recruiting is so often misunderstood and misinterpreted and is incredibly hard to do well. Friends, family and past co-workers have often asked me; Why do you still do it?

Well thanks to a spur on by RecruitingBlogs I have finally put it down in words, Why I Love Recruiting. Its important to share what’s to love about our job with all the negativity around, so I hope this inspires some people and demonstrates to others why it can be a great profession to be in and stick at…

Two words: ‘PEOPLE’ and ‘BUSINESS’.

PEOPLE: There is nothing that fascinates me more, never has been, never will be. My job, especially as I’m also a business leader, is 100% about people. My clients are people, my talent are people, my employees are people and my services and solutions are all people focussed.

People are intriguing, frustrating, passionate, annoying, fun, boring, clever, dumb, irrational, rational, strong, weak, single minded, pliable, emotional, passive, dominant, detailed, sloppy, fearful, fearless, intuitive, blind (not in seeing sense), knowledgeable, well read, narrow minded, interesting, aggressive, friendly, desperate, cynical, angry, happy, caring, selfish…and the list goes on.

I am responsible and accountable for making sure that within this mix I introduce the right people to each other, keep them interested as they ‘date’, manage all the delicacies of their individualisms and the process they go through and then make sure they are happy thereafter. Now to do that well is a challenge. It’s varied. It’s a journey and it has its ups and downs, highs and lows. No other job I can think of would deal with people in such a concentrated way.

BUSINESS: Other than People, here is nothing that interests me more than Business. I get to see and listen to businesses and the people that make them every day. I get to learn about what works, what doesn’t, what’s new, what’s old, issues, solutions and everything in between. I get to see them grow and develop and become all they can become. I’m privy to insights and inside thoughts from the grad to the CEO.

I am responsible for listening so I truly understand them and the people in them. I then get to introduce people into them and watch them all grow and benefit from this introduction.

Both the above can be thankless, painful, political and difficult tasks but it is satisfying in ways I cannot begin to describe (you really have to live it to understand) when it all works.

I love recruitment because I love people and their differences, and businesses and their challenges.

I love recruitment because it pays me to be involved with people in one of the most important aspects of their lives, their careers and their businesses. I get paid to do what I love. Corny, maybe, conveniently truthful – absolutely!

Do what you love. When you love your work, you become the best worker in the world.
Uri Geller

Why counter offers are NOT good (for 90% of us at least)

There have been plenty of articles written on ‘why never to accept a counter offer’, but a recent post “Why Counter Offers Are Good (except for headhunters)” on recruitingblogs.com by @Amos spurred me to write about this for my audience. I was incredulous to read her article whole heartedly encouraging her candidates to elicit a counter offer to get the promotion you want. Sure, it was a brave post to a hostile audience and sure you might think, ‘of course you’ll disagree’ Rob but for those that know me well, trust me when I say, whilst in my benefit it is not for my benefit, but yours. This is wrong advice on so many fronts and in 9 cases out of 10.

I am not going to write anything revolutionary here but it is worth pointing out the facts so that if anyone does encourage (outside your current boss who obviously will) you* to take the counter offer, you have a reference point. Read them carefully and keep them at hand.

The fundamental facts are wholly aligned against counter offers and are as follows:

*Quit pro quo: the presumption here is I am talking to an audience with a strong ethical and moral value system here. If you would happily sleep with your best mate’s sister to get ahead in life then your moral compass is probably too far gone for this to be relevant.

1) Statistically, six to nine months later, 90% of those candidates who accept a counteroffer are no longer employed with the company that extended the offer (Martin Varnier Research)

2) Have a plan. Decent and well-managed companies don’t make counter-offers….EVER! Their policies are fair and equitable. They will never be subjected to counter-offer coercion, which they perceive as blackmail. Do you want to work with one that does?

3) Personal brand damage. By accepting a counter offer, you have committed the unprofessional and unethical sin of breaking your commitment to the prospective employer making the offer.

4) No smoke without fire. Any situation is suspect if an employee must receive an outside offer before the present employer will suggest a raise, promotion or better working conditions.

5) Re-active environments. Counter-offers are only made in response to a threat to quit. Will you have to solicit an offer and threaten to quit every time you deserve better working conditions?

6) Tactics. Counter-offers are usually nothing more than stall devices to give your employer time to replace you. Your reasons for wanting to leave still exist. They’ll just be slightly more tolerable in the short term because of the raise, promotion or promises made to keep you.

7) Team player? No matter what the company says when making its counter-offer, you’ll always be a fidelity risk. Having once demonstrated your lack of loyalty (for whatever reason), you will lose your status as a team player and your place in the inner circle.

(1-7 Source: Wall Street Journal)

These are all very serious and compelling truths about why you shouldn’t stay. However, the ones I want to focus on are 1) and 2).

1)      Because it is a researched fact, not whimsical argument

2)      Because fundamentally whatever the short term benefits of agreeing to a counter offer, do you really want to work for a company that is neither decent nor well managed. Will it serve your career goals in the long term?

Finally, my advice to avoid this situation which is actually the ultimate goal as opposed to turning down counter offers, is this:

If your company is not professional or mature enough to promote someone that they clearly need to and that deserved it because of a lack of corporate discipline i.e. ‘managers too busy’ or any such excuse, then you should take control (this is the proper ‘taking control of your life’ part as opposed to forcing control as a last ditch attempt to get what you think you deserve).

Walk into the CEO/Managers office with a plan. Say you want a promotion and deserve it and articulate why. Being promised “it will come” is not good enough. Do not leave without agreement on your plan or the understanding there will be no promotion because of x, y, z. This plan should be a 3 month SMART goals based plan with Results that lead to Actions. It will maybe take you about an hour to knock up (if anyone wants help with this please email me at rob@33talent.com).

Consequences of not hitting these goals needed to be outlined for both sides i.e. Joe Bloggs doesn’t get the promotion if falling short and the company X must promote if hitting or exceeding goals. Within 3 months you will have reached your goals (if you don’t then focus on getting training on where you fell short and do the same again – all planned and time lined). At this point they have no choice but to honour the agreement or break it. If honoured, break out the champagne. If not, then you now have the ethical and moral high ground to look elsewhere. What happens after that is clearly up to you still (which is a good thing). If you get offered elsewhere and counter offered then of course you could accept it. The good thing is here; you wouldn’t lose the loyalty bonus or ethical standing as they broke their promise first.

However, my aside at this point would be that you are too good for this company. You know you have gone above and beyond, been pro-active, and even implemented a career progression plan for them which they then broke a promise on. So if I was you and the company had rescinded on such a professional, clear plan of action that I had brought to the table, I would know whatever the short term benefits of the counter offer, long term the company did not have a belief or value system that I could happily work within and my career would be better off elsewhere.

My advice to candidates would be to always do it like this, in a professional and planned way. The other route is way too unplanned, emotive, risky and potentially career damaging.

Recruiters are dead…long live Recruiters!

I often get asked by the slightly less experienced and slightly more nervous recruiters I meet (online or offline), how we can compete with corporate recruiters and all the latest DIY social recruiting tools and my answer is 2 fold:

1-      Do NOT compete with them. Not directly anyway. You must always understand your market and build a valuable niche and service for it.

As agency recruiters we provide an outsource service and by default as a service provider we do things people either don’t want to do themselves, do it better than they do, or more efficiently or all 3 in various combinations.

If you have no Value then you will lose and rightly so. Stop stressing about what others are doing and provide your unique value proposition using a nice mix of deep set knowledge, the best capability/solutions out there, that fits and adapts to the market and its needs…and people will buy it.

A typical example I give is I know plenty of people who, like me, hire tax agents. Now, I know I could do the tax return myself – I have done so (grrrr, rips out hair thinking about it!).

I certainly have the brainpower to go through the necessary government instructions. I also have enough smarts to be able to get a few clever returns but I don’t, I do some of it myself throughout the year and then outsource the big bits I want to.

Why?

Well, quite simply I met a Tax agent I liked. He did a good job. I saved myself hours of (what I consider and really no offence here as its meant to highlight I know most non-recruiters would find sourcing boring) boring work I was then able to spend with my wife and it also removed one area of stress from my life. He also found a few things I had missed and got me a better return which helped pay for his service. Also, I knew I was covered by him. Someone had my back.

If, as a recruiter, you can have / provide some, most, if not all of these kind of benefits, you will always be used and valued by many many clients.

2-      Compliment them. Corporate recruiters or Social tools such as LI or BraveNewTalent might be perceived to be trying and steal your market $$ but at the end of the day they are not external service providers and people will always buy a service, so it is actually not really your $$.  These 2 are obviously different though, so let me split them up.

  1. First, Corporate recruiters. Some consultants think it’s the end of their world as more and more clients build internal capability. My view on this is the opposite. The more recruitment is promoted in the right way in a company the easier it is for you to source for them. Sure some internals have it all wrong and are difficult to recruit for but lets leave those people (on both side of the equation i.e. consider only good agency folk too) out. You might need to adapt to the changes in your client and understand different needs but I am yet to meet any company that hasn’t outsourced some part of their Talent Acquisition.

Second, move on. If you are truly not valued despite doing a great job then help the growing companies compete with the big boys that can afford internal teams. Help the SMEs and smaller corporates get the best talent out there and grow into real threats for the bigger companies. Innovate and be brilliant to help your new clients.

Finally, corporate recruiters only care about their line managers and companies. This isn’t meant to ruffle feathers, its a reality. The biggest difference between you and them is the diverse options you can offer Talent. Make sure that that is true and you will have a loyal following they can’t and won’t want to compete with. To Talent, every corporate recruiter equates to another relationship just for one client’s opportunity. You could (I stress the could to make a point!) manage their whole space/search.

2. Second, Social Tools. Again, these are great but HOW MANY?!? Seriously, I am a tuned in Digital recruiter with a Blog in two locations, active on Twitter, LI and have HootSuite and an RMS and PMS and even I drown in the onslaught of Tools.

How do you think the Talent feels?

They apply to Co. X, and Y and Z and they don’t hear anything back and they get calls from companies they don’t want to hear from and they are told to create a profile here, and use FB and who else knows what and they fit this in around their busy and stressful lives?!?

OR, they meet you, a recruiter who is specialised, knowledgeable, connected and NICE…a living person that can say, “don’t worry Fred/Jane” I work with X, Y, Z and can manage the whole thing for you…Again, its not for everyone, there are those that don’t mind building a million different profiles, or managing different tools…that want that control…but there are plenty of people that are really not interested and would rather someone else does it for them. They just need to be able to TRUST you and if you build that TRUST, they will work with you.

The caveat to all this is of course 1) make sure you have Value (a niche and a service worth doing that is needed) and 2) make sure you are good at what you do so you can deliver for those willing to outsource. If you are stressing about the NEW talent world because you know you don’t have 1) And know you are not 2) then, I’m afraid it’s time to shape up because I have no sympathy for that.

Talent Strategy – a must for business now and for the future

Talent Strategy – a must for business now and for the future

One of the things that still baffles me in today’s market is the disconnect between CEO’s listing Talent as their number one pain point and priority and the lack of directional strategy advice being fed into them.

Talent is important – fact. Top Talent shortage is an issue and a major commercial inhibitor and yet in the vast majority of businesses it is not incorporated into the business strategy. Marketing, and Finance have strategies intrinsically linked to the business strategy but HR is rarely included and Talent (in its own right) next to never. If you spoke to a business leader and asked them to exclude Marketing and Finance from the business strategy they would tell you it’s impossible. This is where we need to get to if businesses are going to make the right decisions with regards to Talent. Talent leadership needs a seat at the table and I don’t mean HR, I mean Talent.

Any Talent strategy these days needs to consider two things 1) an exceptional acquisition model where the employment brand is strong and central to all other actions and 2) engagement that is fueled by meaningful development. If you don’t up-skill current staff you will need to find more new staff!

The other side to this coin you must consider is what Talent itself thinks. This shouldn’t be too difficult; after all you are not always the client. You yourself are the Talent too! Recessions, layoffs, boom and bust economics are a reality and people are always looking at their opportunities and risks. Things are not long term. Stability is rare. People will therefore always be considering how to get ahead and loyalty can never be one sided. The strategy must be honest about this and implement solutions around this. All ideas must be built around values true to the organisation and can cover initiatives such as flexibility, development, employment brand and engagement.

If attracting and retaining the best Talent is a serious ambition of your company then it must have a serious place in the wider business strategy, the leadership team, and the communications piece. Without these there will be no top talent, and no chance of competing in the business environment of the coming years.

If you wish to discuss your Talent strategy with us, please do not hesitate in contacting us and have a great half year ahead!

Recruitment is a service NOT a product

Recruitment is a service NOT a product

As the markets in Asia Pacific continue to grow at rates from 6 – 23.5% (in the case of SG’s 1st Quarter 2011!) the ‘war for talent’ continues at a pace (this might happen to not be timely due to the recent makets news today!). There are consequences for recruitment as a result of this growth  which I will be discussing over the next few weeks – attraction, retention, services etc. however, one particular area of contention that needs addressing and understanding is what recruitment actually is (and not)…in any market. Recruitment is a SERVICE. Now this might seem an obvious statement but it actually needs realising and understanding in context.

Why?

One of the biggest disconnects in the recruitment industry and one of the reasons it often suffers in terms of reputation and is misunderstood re value is the fact that it is sold as a service but fundamentally,  invoiced and guaranteed as a product. I have no idea where this legacy comes from (it was thoroughly entrenched when I came into the industry) but what I do know is that it makes it near on impossible to make clients understand what it is we do I.e. provide a service.

Now I understand the reason for both the a) fee model and the b) guarantee clause;

a)      Paying a % of someone’s fixed salary or as a margin on a contract is an easy way to tie the amount to the value of your network and relationship. It should also be exactly relative to the value to the client of the person being hired.

b)      The guarantee stops the less than ethical people of this world ramming home the wrong candidates and then buggering off with a fee and no care in the world. It also mitigates the client’s financial investment risk to some degree by making sure a replacement is found asap if the first candidate doesn’t work out.

However they are both in direct conflict with a service model and therefore fundamentally flawed. When you hire a lawyer for their services you pay them by the hour (well, 8 minute cycles in most cases actually) and they provide a good service if not a result. You wouldn’t ask 6 lawyers to provide their service, decide which service had the most attractive looking proposition and only pay that one and then after 3 months of working with them, ask for your money back (or to do it again free) when they don’t get you the result you were hoping for. And here its time for a disclaimer – I am not talking about low-level service lawyers or recruiters – I am talking about the competent professional levels of both groups – i.e. a like for like.

What?

So there is a disconnect between what is provided and what is charged and misunderstanding of this from the Client side (and sometimes the recruiters!) and wherever there is confusion there is conflict and reputations suffer. This obviously needs to be dealt with and quickly (its been going on too long)

I am not proposing we get rid of a guarantee. However, I do think we need to look at how we charge and that the bulk of recruiters look at what is guaranteed and why.

Consultants and agencies as a whole need to understand this themselves and where their clients are coming from. They then need to be able to sell and justify their service i.e. understand their value proposition – both theirs and their companies. They need to provide training to their sales staff so that they can clearly articulate all this and educate clients.

Clients need to try to understand their service providers so there are no misaligned intentions. They also need to stop focusing on price and consider true cost. They need to stop putting all the onus on recruiters if their Talent don’t stay and start focussing on employment branding, engagement and retention. Judge us on our service, not how you manage your Talent once on board!

What if/else?

Long term there needs to be an overhaul of the model. I have focussed on increasing project and retained work which has gone from 0% to 64% as a result. This is a good stop-gap. It takes time, training and education to consultants and clients but is much more efficient for all concerned – recruiters, clients and candidates. There are other new and revolutionary solutions you will see coming from me soon. Its time to change!

Why you should never “low ball” an offer in Talent Acquisition

A recent experience highlighted this issue once again, but to such a degree that I needed to write about it this time. There are many people who have tried to justify “low balling”, particularly in the sales spaces I have worked into, where the pressure, particularly in “macho” terms is to look at the OTE/upsides.

However, I have never heard or witnessed a single case that’s gone well in all 11 years of consulting. To be clear I want to define “low ball”. I am not talking about offering the lowest acceptable offer (also not advised if you’re serious about QoH and retention) or an offer that is off because of bad process and communication i.e. expectations aren’t dealt with up front or not clearly outlined. Those are inexcusable talent acquisition mistakes. No, here I am referring to an offer substantially lower than the ‘known’ low amount advised by the recruiter or directly from the candidate.

So with that in mind, what are the other possible reasons hiring managers would “low ball”? Well there is only 2 and all reasons when push comes to shove fall into these following categories:

a)      Financial restrictions – internal banding,  upfront cash, risk/reward

b)      Get a good result (pure perception) i.e. get someone for cheaper than you thought you’d have to pay thereby getting a competitive advantage over both the market and making it easier to and quicker to get your return.

If the answer is a) then again, as with poor or no communication upfront, the reality is the reality. Avoiding this reality by being vague or saying “it’s in the ball park”, because you really like the look of the resume or are excited by the potential, doesn’t make the reality go away. There is no case ever where when you have understood what a candidate’s lowest limit is, anything lower than that at the end of the process is acceptable or going to bring on board an engaged and ready-to-go talent.

If it’s b) then I can tell you it will never be a good result. You might get them cheaper but they undoubtedly will feel aggrieved and there will be mistrust and confusion over value and belief in the company. It’s hard enough to get Talent engaged and retained when things are done brilliantly, let alone starting off on the back foot.

The fact of the matter is that all expectations should be laid out up front. If you cannot meet that person’s lowest expectation you should not go through the process. Apart from wasting your own hiring and HR managers’ time and efforts, you will not ever secure an engaged and committed Talent whatever the answer to the offer. Also, they will always be open to further, more realistic offers from the market down the track. The true cost of losing out to another company once you have paid and trained for 6 -1 2 months will far outweigh the savings in salary you thought you were making.

Finally there are a myriad of consequences that come from low ball offers that only add to the argument, they should never be done. These include market reputation and employer branding, disengaged recruiters, disgruntled hiring managers and the pressures that come with people’s time wasted. Always secure the best talent you can by putting your best foot forward.