Economic Recovery Demands High Value Recruiting

Recruiters Must Become Indispensable while Co-Sourcing Flexible

During this economic downturn, recession, slump – pick your phrase, we have seen more contract recruiters and search companies take a hit. Not a surprise. Less hires, and thereby less to outsource to third parties. As I talk with third party recruiting organizations, many are trying desperately to branch out into other industries, get new accounts, and market. Many are changing terms and offering discounts. This behavior was expected, and as with the time after the Internet boom, and there are a percentage of these staffing companies that just won’t make it through. There are a number of contract recruiters that will also want to go inside.

Our US economic situation may not allow for it. HR transformation (defined as increasing the percentage of HR specialists in recruiting, compensation, OD, and other HR disciplines) has been a trend for several years. Companies that decided to have internal recruiting organizations or use RPO have likely already done so. The out of work contract recruiters, those working for RPO that were laid off, and executive search associates are going to find that their brothers and sisters in corporate recruiting are also being let go, so how is there possibly room for them inside, let alone getting transactional business? Hundreds if not thousands of corporate recruiters have their goals and objectives tied to open requisitions and certain activities that assume the company is hiring.

How did we get here? How did we so closely link the entire function to transactional work? Why did we not align recruiting to business objectives like other critical functions such as procurement, finance, and information technology? We had the opportunity to transition to organizations that were built with strategic leaders and rely on partnerships and flexible staffs (aka not headcount) to do the variable work. As staffing experts, we should have known better.

We should have learned from our manufacturing teams, who eliminated part time workers and outsourced shift labor in exchange for efficiency, quality, and safety experts. From our IT colleagues, that stopped doing programming in house and got business analysts with MBAs to sit with the business and solve problems. But what done is done. We have lots of recruiters with no jobs to fill, and thus no need for recruiters. So what is a corporate or commercial recruiter to do?

Short answer: Our HR and executive leaders need to retool the function to be staffed to a certain headcount level that does NOT regard the number of positions.

What? You want me to build a recruiting organization but not use the number of hires that we have as an indicator of how many people should be on the team?

Exactly. For years we have been measuring time to fill, cost per hire, and all these different metrics, and benchmarking ourselves against companies. Google does this, and Microsoft does that. Honeywell does this and GE does that. Well now we have no reqs open (or 75% less) and we have a bunch of managers looking around saying “what are you doing?”

Let’s admit something here – most companies don’t have brands like Google or Microsoft, and many don’t have the HR / project management excellence of Honeywell or General Electric. So why do we continue to try to mimic their every move? All that has done has put us in a position to talk about operations and now we have no operations, so we are expendable. We became the manufacturing plant that needs to be shut down because nobody is buying cars.

In this economy, we need to focus on one thing as recruiter leaders: making sure that the team we have is indispensable – regardless of the number of hires. We need to focus on making sure that the core group of employees that remain are deemed highly valuable. The work that they do is absolutely necessary, and their existence is not simply related to the number of requisitions they carry. Our economy is likely going to go up and down for a while, so we don’t have the luxury of staffing full time employees up and down with the Dow and S&P 500.

Take this time to look at your remaining group and re-think. Here are some steps to get you started on building an indispensable team, and one that will retain employees in the new economy:

Figure out if there are team members in your organization that were hired based on the simple fact that they can handle managers and fill reqs when open. This group may need some training. Get them trained up on project management, special initiatives, and communicating with managers regularly and regardless of hire. They are likely already targets for dismissal or may already be looking at industries that are hiring now and ready to make a switch when the flood gates open.

Get a handle of the attrition and retention rates of your company historically, and ask the CEO and executive suite what the real plans are. Are you letting people go? Acquiring? Divesting? Get a handle on the new volume – not so you can divide up the reqs, so you can create a service organization that can enable the business. You need to plan on some hiring eventually, and your team needs to be customer service oriented, and ready for anything in this new economy. Now is not the time to start adding hiring managers to each member of your team – its time to have each hiring manager get MORE time with each recruiter.

Assume that it will be harder than before to perform staffing. The talent marketplace may have increased, but that does not always mean it is easier. Look at the facts – we were already on track for talent shortage with the baby boomers retiring, and that generation lost 40% of its net worth. You think they are retiring now? NO – they are staying put, and likely not moving around. With real estate in the tank, few can sell their house. With more dual income families than ever before, having the spouse leave the other job is going to be difficult. We already have more applicants applying per requisition, meaning more to go through. We are having more conversations with managers about hiring the unemployed or the underemployed and what that means. There are more people on LinkedIn, CareerBuilder, and Monster than EVER before. BTW – we stripped our recruiting down to the bone, so all this extra work has to get done by less people. So plan accordingly – use technology, outsourcing, and flexible staff to get the extra stuff done.

Lay out all the projects that need to get done in the next 24 months and assign with retention in mind. ATS upgrades, university relations programs, interview training, etc. Assume that you are staffing at full bore – what areas need improvement? Start now. Figure out how long it will take and how much your team is capable of doing. If you can do it all – great. Likely you can’t. I may live in a house, but it does not mean I can build one. Use your vendors, partners, consultants, and contractors to augment where your need. Push your team to projects that teach them something, and stretch them, but don’t wear them out. Indispensable means you can’t throw them away, but also means you can’t dump on them either. Figure out who is working on what, and get the OK from management, and make those goals and objectives bonus driven.

Some of your new core organization will never touch a requisition. Some may have to, so build that in. Now go and get the flexible team to surround your core team. Maybe they are full time – maybe not. Could be internal or external. My advice is make it easy to turn them on and off, and make the ROI justified. You want an internal sourcing group using search strings and blogs to save on search fees? Fine. Make sure you can still justify it. If you are not hiring executives or have been able to attract executives without hard core sourcing in this economy, then your justification for a full time internal sourcing team may no longer be valid (or have changed). Remember there is tons of great contractor talent out there. $100 per hour may be expensive, but part time work for 60 hours a month @ $100 / hour is cheaper than a full time sourcer at $75,000 in salary, overhead, and management.

The watchword is now (and always has been) VALUE. We are under pressure now to drive value in recruiting and prove our existence. It will look different in the coming months, but with planning we can be much better off than where we were.

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