Welcome to Issue Number 2 of The Dosier
It's been a few months since we last got together to talk about the world of technology recruiting. Since then a lot has happened. An entire industry exploded as the Internet Boom became the Internet Bust. Oddly enough, pressure to find and hire top talent in the IT sector continued unabated, proving the old adage that there's plenty of mediocrity out there, but finding quality still takes time, effort, and intelligence.
Our second issue includes just two articles, but we think they'll be particularly useful to you:
Thanks for visiting; Don't forget to check back here for Issue #3 in June!
The best recruiters
we know practice a surprisingly
Today we're talking about essential skills to win the talent war. Recruiters have to focus on two main items to assure the survival of their companies, and by extension, themselves.
Item One is the development of unique, or at least imaginative methods of sourcing talented staff. By looking in less traveled spaces, your chances of finding passive candidates who haven't been picked over by every recruiter in the Western Hemisphere increases.
Item Two is the development of your own value proposition. We all work in an environment where production is king. How will you add value to your customers this year?
Looking for Clues
We spend most of our time studying companies who ask for help in developing their recruiting programs. Some are on the ropes and need a lot of help, fast. Others are start-ups trying to develop world-class practices from scratch. And some are already more effective than they realize and just need some tweaking to add capacity, create new sourcing opportunities, or develop an effective marketing strategy to draw candidates.
As a result of our performance
benchmarking and industry research, we've discovered some strong
differentiators in high-performance recruiting organizations. Many
center on a critical shift in the assumptions and models that world-class
recruiting practices use. The chart below shows the main differences
we've observed between traditional and "quality-based" recruiting
The drivers behind these changes are pretty straightforward.
Operating Model: In successful organizations the operating model for recruiting has shifted focus to the value generated per hire because opportunity costs are high and product and opportunity life cycles are shorter than ever. More than 50% of businesses in a recent InfoWorld survey say that hiring shortfalls materially affect their ability to develop and launch products.
Delays in bringing key people aboard can take an opportunity off the table forever. To quote Warren Beatty in "Heaven Can Wait," "We don't care how much it costs, we just care how much it makes."
Aggressive companies pursue this strategy even in downmarket conditions. And they tend to hold market share and are poised for recovery.
Organizational Alignment: The idea of serving corporate customers (hiring managers) is critical to successful organizations. Time and time again we've talked with managers who chose to cut recruiters out of the selection and hiring process because they don't see the value of including them. Either the recruiters don't demonstrate understanding of what the manager wants in a new hire, or they don't generate leads as useful as those provided by third party agencies.
These aren't the right conditions for centralized recruiting and hiring. Recruiters risk being trivialized if they're not dedicated to a business unit, and in the field learning everything about the business they're supporting.
Recruiting Activity: Many organizations conduct "binge" recruiting, mobilizing only to fill open headcount. Bad idea on several levels.
First of all, if you're hiring as part of a larger economic expansion, you're engaging at the same time all of your competitors are, making your job and your probability of success lower.
Second, recruiting is all about human beings, who become discontented, look for new opportunities, and decide to change their lives according to internal concerns that often have nothing to do with the economy. If you're not looking when they surface, somebody else gets them.
The third problem with episodic recruiting is related to the second. If you aren't on a constant hunt for talent, you limit yourself and your organization to whatever sampling of candidates is available or amenable at the time. It's like trying to time the stock market.
Smart organizations are on a constant search for talent. If there's an open slot, fine. But that doesn't drive the search. They are always prepared to hire a star with or without a job requisition, and network with promising candidates as they find them.
Recruiting Profile: A prominent software company in the mainframe applications days had a rule about building their sales force. Nobody started there. Entry level prospects began as recruiters.
What worked 15 years ago still works today.
Recruiting is all about marketing and selling now. The scarcity of real talent means that recruiters have to become both strong qualifiers and persuasive sellers.
Recruiter Alignment: Again, to be viewed as an asset by management, it helps to be viewed. Dedicating recruiters to business units helps them and helps the business unit.
Recruiter Role: Success comes from focus. Rather than requiring recruiters to engage on many unrelated positions, smart organizations give them a chance to excel by focusing their activities on candidates and skill sets germane to their business unit or division. Technical recruiters focus on tech hires, sales on sales, and so on.
Sourcing Guidelines: All things being equal, speed trumps cost in smart organizations. Cisco has ramped up to turn hiring cycles in a week or less. They do it through a variety of tools, like an applicant-friendly web site, early involvement of line staff to evaluate candidates, and a recruiter-centric infrastructure.
Recently, Mirage Resorts, parent company of Las Vegas' new Bellagio Hotel, spent a million bucks and used a 14-month infrastructure development cycle to recruit and hire 9,600 people in less than six months. And representatives from Cisco flew down to benchmark their system.
Recruiter Metrics: All things being equal, speed and quality trump cost in recruiter evaluation, to.
Consider this example: You're looking for implementation consultants for a technically complex software product. No matter how good the candidate, you anticipate a learning curve of one month before they're ready to meet and work with clients as part of your implementation team. However, once up to speed you can bill them out at $140/hr., or $24,360/mo.
Recruiter A employs traditional and Internet advertising and posting methods to look for prospects. He takes eight weeks from receipt of a job req. to find, evaluate and close one candidate. Assume a cost-per-hire of $5,000.
Recruiter B employs Internet data mining to track all web pages that link to a competitor's web site. In two days, she identifies four potential passive candidates and closes one within four weeks. Assume a cost-per-hire of $1,700.
Recruiter C picks up the phone and calls a third-party agency. She has three leads in one week and closes on one candidate in two weeks. The base salary for the position is $90,000 and the agencies' cut is 25%, or $22,500.
In smart organizations, time has value, and CPH is just part of the equation. Take a look at the diagram below.
Here we estimated that our new consultant would generate about $13,000 for our company every month, after their 30-day training period and after her salary and benefits are deducted from her monthly billings. To get the full impact of hiring cycle times, we are including the lost earnings opportunity caused by hiring cycle length. So, Recruiter A's hire starts their non-productive period on week eight and goes through week eleven on our chart. On week twelve, they begin to work against an investment that includes the $5,000 CPH, their salary for the first month on the job (about $11,500 including benefits), and an opportunity cost to the company of $26,000. This employee will become profitable in their 25th week of employment.
Taking this view brings some surprising aspects of hiring into focus.
This is a fairly simple example that takes just a few major cost factors into account. But it does illustrate the value of time as a component of the recruiting process, and the underlying reasons that speed and quality are more important to smart organizations than simple cost containment.
Candidate Profile Focus: Experience is a useful tool for first-pass culling of applicants. After all, trying to turn a food-and-beverage salesman into a quota busting Account Executive for your e-CRM application is a flyer most managers won't want to take. But smart organizations actively search for and evaluate essential competencies that create a strong likelihood of success in a candidate.
Variables like those we're discussing today - discernment, proactivity, competitiveness, persuasion - are the building blocks of success.
Given a choice between hiring someone with few demonstrated competencies and tons of job-related experience, and a candidate with less experience but a well-stocked toolkit of competencies, smart organizations often go with the less experienced candidate.
This covers the major drivers behind the quality-based recruiting model. Now that we've covered these at the macro level, it's time for a little checklist we've developed for you.
Is This You?
It shouldn't surprise you that the quality-based recruiting model tends to favor some skills over others. Based on our observations, we've come up with a profile of highly successful recruiters in the information technology industry. We hope it helps you verify and reinforce competencies that you have, and provides useful tips. Comments are included when appropriate.
A first tier recruiter:
Moving Targets: We're on a constant hunt to learn about innovative approaches to IT recruiting. If you think we've missed something important, or want to ask a question about the information in this handout, you can reach us here (see below) or at 877-389-1250.
Got a question or a comment? Contact the author here.
Here's an interesting anecdote. A few months ago we were involved in a training gig with a good-sized apps software company. Nothing unusual about that. But during the session we'd focused on the need for recruiters to develop their personal sales skills. At one point, we asked a technical recruiter to craft a sales message to convince a particularly ambivalent software engineer to join up.
Things were going fairly well. The recruiter was hitting non-monetary points like technicalchallenge and the company's emphasis on R&D to stay ahead of the pack. Then she says, "And our applications are fully web-enabled, all Java."
Pretty cool, except there's no Java in them there apps. The company had created a beautiful suite of business software applications. All XML, no Java.
What's the big deal, you ask? Well, put yourself in the Birkenstocks of a twenty eight year-old Cal-Berkeley grad who's earned every penny of his adult life through the Internet. Things are going fine, they're thinking seriously about throwing in with your company, andthis misstatement floats through the room. Now the recruiter's credibility is in question. The engineer wonders what the recruiter's level of commitment to their trade is. After all, he'd read about the company's fully XML product line in Information Week last August, it came up again at Oracle OpenWorld and he's been following a shooting war between some software engineers in competing companies in a newsgroup he monitors.
How come the recruiter didn't know?
The point of this is that, like any hunter, you've got to spend time in the jungle. In all ofrecruiting, but particularly in IT, superficial familiarity with the skills and tools your best candidates own and use will hurt you as often as it helps.
If you're a technical recruiter, get to know the technology your programmers and engineers use. You don't have to become a power user (though it couldn't hurt). Buy a CD-based course on Java, or Active Server Pages, or whatever. Check out online tutorials at Webmonkey.com. Invest in your growth.
Are you a sales recruiter? Then like Stanislavsky said, learn the method. Pick up NeilRackham's book, Spin Selling. Or Michael Bosworth's Solution Selling. Spend a couple of rainy nights with Selling to VITO.
You have to be able to converse credibly with your candidates. No screening tool, proficiency test or resume can replace the insight you are capable of, when you've armed yourself with the right information set.
Like Emil Faber, the founder of Animal House's Faber College said, "Knowledge is Good."
That's it for this quarter. Thanks for stopping and we'll see you again in June.Got a question or a comment? Contact the author here.
The Dossier Mission Statement:
purpose in this e-zine is to share our thoughts and opinions on
the business of recruiting for talent, to help you stay on top of
the thinking in our industry, and to help you deal with the hiring,
evaluating, and sustainment issues that keep your company from achieving
at the highest levels.
We write these articles; we are talented recruiters, project managers and teachers. We hope you enjoy the 'zine, and that you'll share your comments with us.
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