The Uber of Recruitment #hrtechconf

Apparently, the new marketing message for Talent Acquisition technology is to call yourself the “Uber of Recruitment”. I have had six different companies actually use this phrase to explain what their product is, and how it works.

Marketers love to play up being a ‘disruptor’, like Uber did to the taxi industry.  I love using Uber, and I think most people that use it really like it as well. So, making the jump in marketing to use that positive image and tying it back to your product makes perfect sense.

Lazy, but I get it.

Here’s the bigger story, companies are trying to cash in on the multi-billion dollar recruitment industry. Okay, it’s not a big story, it’s been happening for decades, but we are getting to a point where you can see technology making a serious play at truly changing the way companies interact with traditional recruitment agencies.

This is my game, so I’m definitely interested in checking out all these new Uber of Recruiting plays.

Here’s how most of these technologies work:

Step 1: Use our technology to connect with candidates

Step 2: We charge you about 75% less than traditional recruitment agencies

Step 3: We cut out the middle man

Step 4: You get same talent, faster, cheaper, happier.

The basic premise is Uber simple. Put the power of recruitment into the hands of the candidate.  Let them easily connect with those companies that seek their expertise.

Here’s why this is hard.  All of these Uber of Recruitment plays don’t really have an answer on how do we get people and/or companies to use their product.  The need to use Recruitment Agencies are based on a few main premises:

1. The most desirable candidates are not looking, and must be found.

2. You don’t have capacity or skill in-house to find this talent.

3. Agencies can find better talent, than other options (remember this is the premise of use!).

The Uber of Recruitment plays don’t necessarily address all of these premises. I do believe that this technology is going to have an impact to a part of recruitment industry market segment that has issue with cost.

The technology makes it easier for organizations to almost run their own type of agency in-house using this technology, and it makes it easy for candidates to connect.  But, the huge miss is that these technologies still don’t go out and sell a talented person, who is not looking for a job at your company or any company, on why they need to consider this job.

That’s called recruitment, or sales, which is recruitment. Uber of Recruitment technology doesn’t recruit, which is why these plays won’t end the industry as we know it. Uber as an example doesn’t really fit as a recruitment industry killer, but it might work in terms of disrupting and pushing bad agencies to get better.

 

CareerBuilder Empower 15 Live Stream Wednesday Sept. 10th!

Next week Wednesday, September 10th, CareerBuilder has asked me to Host their Live Stream of Empower 15!

That’s right, someone made the brilliant decision to put me on LIVE. Lights, camera, action!  To bring to you all the cool stuff happening at Empower!

The Live Stream will start at 8am CST and go all day until 5pm CST (that’s 9am for you East Coasters – and way too early for those on the left coast!).  My friend Laurie Ruettimann will be joining me to kick it off in the morning, then I’ll be bringing you many other great HR and Talent Pros/Celebs throughout the day. Click on the link above for Wednesday’s lineup of great presenters!

Click below to get to Live Stream feed:

Empower 15 Live Stream

What is Empower?

DISCOVER. ELEVATE. INSPIRE.

The act of connecting employers and job seekers to make meaningful matches has changed dramatically over the past 20 years. And new economic, digital, and social trends have introduced an entirely new set of challenges. We’re giving you a front row seat to share the journey as we look back and, more importantly, ahead to the next 20. Join CareerBuilder and 1000+ other leaders for the talent acquisition event of the year where we’ll identify opportunities to continue to move the industry forward and work together to make recruitment easier and more effective.

Empower is Talent Acquisition’s version of all those cool HR conferences your HR peers get to go to, but they aren’t really designed for true Talent Acquisition leaders!

There’s No Free Staffing Option

I’ve gotten a chance to work both sides of the fence for an extended period of time in the Talent Acquisition/Recruiting/Staffing game. For ten years I ran corporate talent acquisition shops for some very large organizations.  One organization spent over $3M annually on staffing agency fees! Obviously, prior to me getting there!

I’ve spent almost fifeteen years on the agency side, sandwiched in between my corporate experience. What I’ve learned along the way is that there isn’t a “free” option when it comes to hiring great talent.

Frequently, I get asked from clients for discounts to my fees on the agency side.  I get that. When I was on the corporate side, I would never take an agency’s first offer.  Here’s the main problem with all of this:

Corporate talent acquisition pros don’t want any of it. They don’t your 20% direct fee, they don’t want your retained plan, they don’t want your RPO plan. What they want is Free. A free option.

Therein lies everything you need to know about staffing agencies and corporate talent acquisition.  One side wants free. One side needs to get paid.

The reality is, even staffing on your own on the corporate side isn’t free.  Corporate talent acquisition done right, has a ton of costs. Recruitment tools, automation, branding, job boards, applicant tracking, college strategy, recruiter training and hiring, etc. None of that is free.

All of this, though, should be screaming to the agency folks that something isn’t right.  What corporate talent acquisition pros are saying is “we don’t like the options we are getting from agencies”.  This should be of serious concern, because there are companies trying to design other options for corporate talent acquisition pros.  Options where they’ll feel like they are getting the value they want.

These options aren’t free, either, but they are less than all of the traditional options that 99% of staffing agencies are offering.

When I was on the corporate TA side of the desk, here was my decision matrix to when I would use a staffing agency. This matrix made me feel good about my decision to use an agency:

1. Does my team have the capacity to do this search? If Yes, why would I pay to have this done. If No, the cost if justifiable.

2. Does the agency offer me a recruitment expertise and/or pipeline I don’t have on my team?  See #1 for Yes and No options.

3. Is it financially feasible for me to add more capacity to my team, as compared to an agency option? This one took some more work. If I had a need for an agency to fill, let’s say, three positions and it was going to cost me $100K, well, obviously I could hire a pretty good recruiter for $100K. But, would I need that Recruiter in year 2, 3, etc.? Adding headcount isn’t a one time cost for an organization.

Ultimately, for me on the corporate side, it was almost always a capacity issue.  I had the expertise, but we had bubbles of work I needed extra support with.  Too often, I see corporate TA leaders upset over agency spend and it’s based on the fact they don’t have good recruiters on their team, yet there unwilling to change this fact. I’ll pay for additional short term capacity. I won’t pay for expertise I should have on my team everyday. That becomes my issue!

Corporate TA leaders become frustrated over agency spend because ultimately it’s a reflection on the team they have created.

 

Working for Free – Contingent Search Model Changing

A funny thing happens when the economy is good. Corporate Talent Acquisition pros believe that agency contingent recruiters should work their job openings like its the most important priority the recruiter has ever had.  There are a couple reasons for this:

1. This opening is the most important priority for the Corporate TA pro, so it should be yours.

2. When the economy was bad, you treated the Corporate TA pro like they were your number one priority.

Then the economy gets good, and the agency folks have choices and now as a Corporate TA pro you find out who your real agency recruiting friends are!  Those who will actually come through for you, when you call on them and tell them you have something urgent.

My Corporate TA friends are the ones who pay me.

Don’t take that wrong.  You see this is the game we all play.  You want me to work your opening, but you ‘really’ don’t want to pay me if you don’t have to.  I get it. You get it. It’s the world of contingency recruitment.  I spend most of my time just trying to truly determine who will pay me for the work I do.  Because most of the work I do is for free.

So, now that the economy is good, way too many Corporate TA pro have unreasonable expectations of their agency counterparts. If I’m working for free, mostly, I’m going to be more picky about who I work for free for.  If you have me work five openings, and you then fill all five on your own, I’m probably not working your ‘urgent’ number six. If you have me work three, and I fill one, I’m helping you out. It’s simple economics.

Something new is being added to the game. This happens when times are good for agency recruiters.  There are two types of recruiting on the agency side:

1. Contingent – see above. Basically, I work for free until I find you someone you want to hire, then you pay me.

2. Retained – You pay me my big fee up front, and I work until I find you the person you want to hire.

Traditionally, retained is really only used for executive search, but when talent is hard to come by, you’ll also see it used in the professional ranks.

Recently, I’ve been seeing a new hybrid model of search show up, called Retained Contingent.  Retained contingent is a mix of both models. It’s still a contingent search, but you’re paying me about 10-20% of the fee up front for me to prioritize your search to the top of the workload.

Let’s say you’re searching for an Engineering Manager for $100K, and signed a 25% fee agreement. The total fee upon placement is $25K. In the Retained Contingent model you would pay me $5K to start the search up front, then $20K upon placement guarantee. If I don’t find the person, after a contracted amount of time, the $5K is for my work, no other fee is owed.

This is a win-win for both the Corporate TA pro and the agency, but only if the Corporate TA pro is sure they want to pay for the search.  If that’s the case, I want the benefit of retained focus and prioritization, without the risk of paying the full fee up front and having the firm not come through with a successful hire.

I don’t want to take you cash and then fail. You’ll make sure everyone knows I failed.  But, I also have limited resources and want to focus those resources on the best clients. We both have skin in the game.  That creates a partnership. That creates success.

Just wait. You’ll see a lot more of this over the next five to ten years.  Corporate TA pros are getting smarter, and so are the agency pros.  In the end, both sides want value for their work.

T3- @Hirabl

This week on T3 I take a look at the specialized staffing vendor software technology called Hirabl.  Hirabl is designed to help staffing companies catch revenue they missed because a client, or potential client, hired one of of the staffing vendors candidates, but never paid the fee. What!?!

Yep, it’s actually a fairly common occurrence in the staffing and talent acquisition game.  It can happen a number of ways. I don’t want my talent acquisition brother and sisters thinking I’m called them cheats.  99.9% of are completely above board, but .1% are sneaky!

Here’s how it all might go down:

An organization is contacted by a staffing company to help on an opening. A good staffing company will insist on a signed contract.  The get the signature and begin working.  The organization decides not to move forward with any of the staffing companies candidates. Both parties go on their way.  This happens a lot in the staffing world.

Fast forward six months down the road and the organization has the same opening.  They post the opening and a candidate comes into their ATS. The same candidate the staffing company presented six months prior.  By contract, that candidate is still ‘owned’ by the staffing firm. The organization hires the candidate, but never thinks about paying the staffing company. The staffing company has moved on and doesn’t even realize you hired their original candidate.  By contract the organization still owes the fee, but it’s rarely collected, because on one comes asking!

Hirabl has technology that goes out and through social profiles and your internal data, finds these circumstances.  You then get an alert, so you can go ‘remind’ the organization you presented the company to that they indeed owe you some money.  Depending on your volume, Hirabl, on average, is finding hundreds of thousands in lost fees.

You need a couple of things to make this successful: 1. Good, signed contracts; 2. Good data for them to search on. Most staffing companies, using a decent ATS, will have the data.  The contract question might be more difficult for some. In my organization we don’t do anything without signed contracts, so we would be good on that front as well.

I wanted to write about this for a couple of reasons. First, I know a lot of staffing folks who read my blog that can use this and get back some lost revenue. Second, I wanted those corporate talent acquisition folks to know that staffing vendors are getting more sophisticated, and some things that you might have gotten away with years ago, will soon be coming to an end.

Be careful signing a staffing contract. Usually, most staffing vendors are going to ‘own’ candidates they submit to you for at least twelve months.  That means if you hire one of those folks, even if that candidate came to you on their own, you contractually are liable for that fee. That’s why you should be signing a ton of contracts.  Find a few good firms. Work with them closely, and you won’t have any surprises.

You can better believe I’ll be trying Hirabl!  We do a ton of volume, and as much as I would like to think no client hired one of our folks, I know we’ll find some where it happened. Stay tuned!

T3 – Talent Tech Tuesday – is a weekly series here at The Project to educate and inform everyone who stops by on a daily/weekly basis on some great recruiting and sourcing technologies that are on the market.  None of the companies who I highlight are paying me for this promotion.  There are so many really cool things going on in the space and I wanted to educate myself and share what I find.  If you want to be on T3 – send me a note.

Hiring Is About To Get Really Difficult!

One thing was abundantly clear from speakers and thought leaders at SHRM 2015, hiring is hard, and it’s about to get much harder!

That isn’t good news for any of us in HR and Talent Acquisition. There are two forces that are currently happening that are making hiring more difficult than it has been in over ten years:

  1. Solid economy and job growth.
  1. Baby Boomers leaving the workforce.

This isn’t earth shattering information, we all kind of new this was happening.  The issue is we are now all beginning to feel this in every part of the country and in almost every job category.  This means some things are going to happen, and the top HR and Talent Pros are already preparing for these:

  • Wage Growth: CareerBuilder CEO Matt Ferguson spoke at SHRM on Tuesday and had some great data showing that organizations see wage growth of around 5% in 2015, and similar in years to come. Are you budgeting 5% increases? I’m guessing not!
  • Recruitment Process Challenges: How many steps does it take to apply for a job in your organization?  If it’s more than two, you’ve got problems!  Can someone apply for a job online with your organization without having a resume? Why not?  Matt also showed data from CareerBuilder showing 40% of HR and Talent Pros have never applied for one of their own jobs to better understand the true experience!
  • Technology Challenges: Do you have a way to reengage candidates in your system on a regular basis?  A system that allows you to let great talent know, that you already have in your system, when you have an opening that fits them? It’s called CRM, and only about 20% of companies have technology that can do this important recruitment marketing function!
  • Job Design Challenges: Too many of us are working and designing jobs like we are living in a society that was pre-internet, pre-ultra connected. We still think we need employees sitting in front of us from 8-5pm, Monday thru Friday. If they aren’t sitting in front of us, they must not be working! Indeed shared that 80% of job searches on their site include this single word: “Remote”!  Are you adjusting those jobs that can be flexible?

Those organizations that believe they can recruit and get talent like they have been doing for the last couple of decades are going to fail.  It’s really that simple.  Talent attraction will be a powerful strategic differentiator for organizations over the next decade, like almost no other time in our history.

The good news?  At no other point in our history do have access to the information on how to be successful!  Twenty years ago, doing great talent acquisition was mostly trying stuff and getting lucky.  In today’s world you can learn easily how the best organizations are attracting talent at conferences, on websites, in blogs, webinars, etc.  There are so many sources of this information, that we now have no excuse to improve what we are doing.  We just have to do it!

 

T3 – Recruiter Sidekick

Today on T3 I take a look at the talent acquisition tool Recruiter Sidekick. Recruiter Sidekick helps take care of one of the biggest issue we all face in Talent Acquisition, regardless whether or not you are agency or corporate.  We do a terrible job a mining our own internal databases!

Your internal database in the most underutilized resource that you have.  I could go into most corporate talent acquisition shops and fill 35-40% of their jobs from their own database, without ever having to use another tool to find and source candidates!  How do I know this?  I’ve done it.

This is the primary idea behind how Recruiter Sidekick was developed.  It runs like an extension to your ATS and acts like a referral engine from your own resume database.  It basically looks at every new requisition being put into your ATS and instantly begins searching, based on their own proprietary algorithm, and sends your recruiters a “top 10” list of candidates that most closely match your requisition, that are already in your database.

Think about this concept for a minute.  Two years ago you were hiring for a specialized position in your company.  You presented a number of candidates to your hiring manager.  She interviewed three, and eventually chose the one.  Two more years pass, and you’re growing, or you had someone on your team retire, and now you need to go hire another person in the same role.

Most organizations – like 99% – just do the same thing they’ve always done. They’ll take the new position, input it into their ATS, it will get posted to your career site, maybe a few others, and you’ll begin the process of looking at those candidates who are ‘now’ available.  But, what about those other two candidates two years ago who wanted to come work for you, but someone just beat them out.  Now they have two more years of experience. Maybe one of them is the ‘one’!

In a nutshell, this is what Recruiter Sidekick helps you with.  Recruiter Sidekick doesn’t let you forget you have unmined gold in your own database.  All of this for $10 per month, per recruiter.  It’s a niche piece of software to be sure, but one that almost all of us can use.  Heck! I’m paying an intern right now to just do this, mine our own internal database for talent!

Check them out. For the price you really can’t go wrong!

T3 – Talent Tech Tuesday – is a weekly series here at The Project to educate and inform everyone who stops by on a daily/weekly basis on some great recruiting and sourcing technologies that are on the market.  None of the companies who I highlight are paying me for this promotion.  There are so many really cool things going on in the space and I wanted to educate myself and share what I find.  If you want to be on T3 – send me a note.

3 Ways Contract Staffing Fails

Contract technical staffing is what I do for a living – so I know exactly where it falls down.  I spend every day trying to talk people into why they should use contract staffing and why it makes sense.  In 13 years of being in this business, I’ve never had anyone ask me why it doesn’t work.  That might be kind of odd.  Don’t get me wrong, I’ve talked to hundreds of corporate HR and Recruiting Pros who HATE contract staffing, but 99% don’t know why they hate it.

Most believe they hate contract staffing because it’s taking their job away.  Nothing makes me smile more than to hear a really good HR Pro say “if I hire your company ‘they’ll’ have no reason to keep me around”.  I always find this a little sad, because that’s not at all true. Contract staffing isn’t in competition with corporate staffing. Contract staffing fills temporary voids of talent and project work. Corporate staffing is looking for permanent, long term hires.

But, to be perfectly honest, there are some reasons when contract staffing fails.  If you deal with contract staffing firms, you might find that shocking to hear, because we are trained from birth not to ever say anything negative about our service.  ‘Everyone’ can use us for any recruiting need you might have!  Well, no not really.  Let me give you 3 Ways Contract Staffing Fails:

1. To Attract your competitions talent when you are equal or trailing in market compensation.  I always like to say there is no one I can’t recruit.  Given enough time and money. I could get President Obama to quit the Presidency.  But if you think a contract staffing firm is going to get your competitions best developer to leave their direct job for a contract job, for the same money or less, you’re crazy and I don’t want to work with you company.

2. When you fall in love with the talent.  Every once in a while I a client who gets upset.  They bring on a high priced contractor, that person does great work, and the client falls in love and wants to hire them.  The problem is many contractors are contractors because they like moving from project to project.  They like you, they just don’t like-like you.  Contract staffing works really well when it’s a win-win. We have a project, you nail project, and we both got what we wanted.  It fails when one party falls in love, and the other doesn’t feel the same!

3. When You Think I’m Magical. Recruiting is recruiting.  I don’t have a magical stable of candidates waiting to come to work for you. Well, I might have one or two, but not a stable. When you tell me you need something I, usually, have to go out and find the right talent, fit, etc.  Just like you would, if you were looking to hire a direct position.  I’m not magic, I’m just good at finding technical talent.  There’s a difference.

I get why some new clients get put off by contract staffing.  I call you, tell you how amazing we are and how good we are at what we do and then you expect I’m going to have 5 perfectly screened ready to work Controls Engineers in your inbox the next morning, when you’ve been searching for 6 months and don’t have one.

Expectations are a huge issue we all face in recruiting, no matter what kind of recruiting we do.  I have to manage my clients expectations, just like you have to manage your hiring managers expectations.  Contract staffing works really well when you find a client partner that makes sure your expectations and their deliverables all line up.

Want to discuss?  Contact me: sackett.tim@HRU-TECH.com, 517-908-3156 or send me a tweet @TimSackett.   I promise to under promise and over deliver.

You Wouldn’t Even Hire Your Own Mom

I had a conversation recently with a friend about how hard it is to work and be a Mom.  Just to be a clear, I’m not a Mom.  I hire Moms. In fact I love hiring Moms, they work their asses off.

I know this because I was raised by a single mother.

I remember my Mom having to pick where we would go buy our groceries based on how long it had been since she bounced a check at that store. I remember her handing me items off the belt to return because they wouldn’t take her check and we only had enough cash for a few items. I remember pouring water into my bowl of generic Fruit Loops because we didn’t have enough money to buy milk that week.

My Mom started her own business, paid her own mortgage and raised two kids. It wasn’t perfect, but we made it. Those experiences shape a kid for life. It makes you appreciate what you have, when you know you can live with much less.  My Mom got hugely successful after I got out of college and my kids only know her as the grandma that has so much.  I can’t even describe to them the struggle, they have no concept.

I have zero tolerance for hiring managers who don’t want to hire moms because they might have to stay home with a sick kid, or they might want to take an early lunch to catch fifteen minutes of fourth grade play at school during the day.  Both men and women, hiring managers, have told me they don’t like to hire moms.  This doesn’t sit well with me.

The Moms I hire are some of the strongest employees I have.  They come to work, which for many is a refuge of quiet and clean, and do work that is usually less hard than the other jobs they still have to perform that day and night.  They rarely complain, and usually are much better to put issues into perspective and not freak out.

When I look at my own ‘tough’ days I try and remember that most of my day is done, while theres won’t be until their head hits the pillow. Old people and Moms are the most disrespected of the working class.  They are the most underutilized workers of our generation.  A woman takes a few years off to raise a kid and somehow she’s now worthless and has no skills.

I don’t even want to write this post because I feel like I’m giving away a recipe to a secret sauce.  All these national recruiting companies are hiring the youngest, prettiest college grads they can find to work for them, and they mostly fail in the recruiting industry. Moms find this industry rather easy as comparable to what they are use to doing.

The recruiting secret sauce, main ingredient = moms.

2015 Candidate Bill of Rights

In November 2010 Monster.com asked me to write a post on a hot topic at that time a “Candidate Bill of Rights“.  Needless to say, I’m not a huge fan of a Candidate Bill of Rights – I’m a Capitalist and believe in a free-market system of HR and Recruiting.  In 2010 (remember those days?) we had candidates coming out of our ears. In 2015, most of us are begging for talent. Welcome to the show kids!

Here were my main point back then – and what they still are today:

Candidates –

You Don’t Have To Apply:

  • If we have a crappy working environment – you don’t have to apply
  • If we don’t pay appropriately for the market – you don’t have to apply
  • If we don’t give my employees opportunities for growth – you don’t have to apply
  • If we don’t treat you like a human – you don’t have to apply
  • If we don’t give you a full job description – you don’t have to apply
  • If we don’t tell you every step of the process – you don’t have to apply

You Don’t Have To Work Here:

  • If we make you wait endlessly without any feedback – you don’t have to work here
  • If we make you an offer that you don’t like – you don’t have to work here
  • If we don’t offer the right work-life balance – you don’t have to work here
  • If we give you a bad Candidate Experience – you don’t have to work here

Candidates – if any of the above is true – you have some decisions to make:

1. Can I live with what I know about the company and the experience they put me through to get this offer?

2. IF SO, do I want to come and work for the company?

3. IF YES – welcome aboard, you’re coming on ‘Eyes Wide Open’

4. IF NO – thanks – good luck – see you next time

You see we all have choices – if you don’t like the way I’m treating you as a candidate, don’t come and work at my company.  I would hope that most HR Pros are smart enough to get this fact – treat candidates like garbage and they’ll stop applying for your jobs, thus making your job all the more difficult.  That might be a bit pie-in-the-sky thinking because I also know way to many HR/Talent Pros that don’t get this!   They have a little bit of power and have decided to torture candidates with painfully long and arduous application and selection processes – that aren’t helpful to their own companies, statistically, and definitely aren’t helpful to the candidates.  During a recession they don’t see much impact from these horrible processes, but eventually the tide turns and face the results of their actions.  Karma is a bitch!

So, do we need a candidate bill of rights – No!  Do you need to spend a ton of time, effort and resources on candidate experience – No, as well!  Don’t go right ditch-left ditch and start over correcting.  Treat candidates like you would want to be treated.  Have a few standards and etiquette, and some manners.  It’s not hard, it’s not expensive and you definitely don’t need to pay a consultant to show you how to do it!

Karma is biting a bunch of hack talent acquisition pros in the butt in 2015.