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The Return of Recruiters - SHRM
The Return of Recruiters
Will staffing professionals be the first or last to be hired as the economy recovers?

Amid accumulating signs that the Great Recession is moderating, companies that believe their core business is improving may begin to restore the employee positions they shed over the last several months.

Has the hiring begun? More to the point, are these companies building up their depleted cadres of staffing professionals in anticipation of employee hiring? Could the hiring of recruiters be, in the terminology of The Conference Board’s monthly national report, a leading economic indicator?

Experts’ opinions vary, but taken together their answers present a vision of workplace recruiting operations after the recession that will be quite different from the staffing models of a few years ago.


Help Wanted?

Angie Salmon, senior vice president of the executive recruiting firm EFL Associates in Leawood, Kan., says some organizations are starting to hire "because they feel more confident about the market and their businesses."

A recent survey by recruitment consulting company DoubleStar of West Chester, Pa., bears this out. Asked late last year whether they planned to increase hiring activity in the first quarter of 2010, 27 percent of respondents—representing organizations in the Mid-Atlantic states—said yes. This represented "a pretty good bump" over the 13 percent who indicated such plans for the fourth quarter of 2009, according to CEO Harry Griendling.

And the Society for Human Resource Management’s latest Leading Indicators of National Employment (LINE) report, released in March, revealed that hiring was up on an annual basis for the fifth straight month. The percentage of companies hiring in manufacturing will reach a level not seen since June 2008, according to the report, and the percentage of companies hiring in the service sector is the highest since July 2007. The LINE report is based on a monthly survey of private-sector HR professionals at more than 500 manufacturing and 500 service-sector companies.

Mitch Beck, president of Crossroads Consulting in Monroe, Conn., has seen hiring pick up but notes that some companies are keeping quiet about it. "What I’m finding is that more companies are starting to hire back but don’t want people to know they’re hiring back, because they don’t want to get inundated" with applications, he says.

Not everyone is optimistic, however, that economic recovery will translate into more jobs. Scott Craighead, general manager, Americas, of Bluesky Executive Search in Fairfield, Conn., says that, in general, "Economic recovery has occurred without hiring increases, as companies have focused on staff cuts to yield profits."

Even if they aren’t cutting staff, companies may not be bringing new hires on board. For example, "Smaller hedge funds that need to hire are standing on the sidelines," says Ev Nucci, owner of Nucci Consulting Group of Gwynedd Valley, Pa., a retained search firm serving the hard-hit asset management industry. "A friend of mine who owns a hedge fund needs four or five people but is holding off" because of concerns about the economy, she explains.

Still, companies with skeleton crews can’t operate that way much longer, says executive search consultant Kevin Palisi of Norwalk, Conn. "You’re going to see more hiring because [companies] can’t squeeze any more blood out of the [surviving] workforce, from a productivity standpoint."


Leading or Lagging Indicator?

"This recession has decimated HR departments and, along with it, recruiting departments," Griendling observes.

Are reinforcements on the way?

Those who think companies plan to increase overall hiring in the near term believe so. For example, Mark Mehler, principal of CareerXroads, a staffing strategy consultancy in Kendall Park, N.J., says certain online companies "are hiring in volume." Those companies—and others wishing to add to employment rolls—must first hire recruiters, he explains, noting that "Recruiting is a bellwether for the economy."

Palisi also believes that organizations "are interested in bringing in recruiters in the near term, the anticipation being they will hire more staff in 2010." He adds that companies "need to hire recruiters six months ahead of the curve."

Others say companies will continue to make do with the resources they have on hand for a while and that an increase in recruiter hiring could actually be a lagging indicator of recovery.

"Usually the first person to get fired and last person to get hired back in a recession is the recruiter," says Dan Finnigan, CEO of Jobvite, a Burlingame, Calif.-based marketer of technology for recruiting via online social networks. "Many companies will actually not hire recruiters right away and be forced to recruit with a smaller recruiting team."

He cites a client—an online retailer—that hired 60 employees in six months during 2009. "They tripled [the workforce] and did it with one recruiter," he says.

Griendling notes that after a recession, companies tend to test the waters by hiring temporary workers as opposed to regular full- or part-time employees. And, in fact, the U.S. Bureau of Labor Statistics reported that 284,000 temporary-help jobs have been added nationwide since September 2009, including 48,000 in February. According to Griendling, it isn’t until later in a recovery, when companies start hiring non-temporary workers, that recruiters are brought on board.

Lisa Rowan, program director, HR, learning and talent strategies, for advisory services provider IDC in Framingham, Mass., expects hiring of temporary workers "to come up further before we see any surge in permanent employment."


Get in Line

Companies looking to grow their workforces may turn to transitional help, such as staffing agencies and freelancers, before hiring recruiters.

As piles of resumes roll into their headquarters, companies find it "easier to inundate an outside recruiter" such as an agency, according to Beck.

Staffing firms and consulting firms confirm the trend. Tracy Cutone, partner and general manager, Human Resources Divisions, of the staffing firm Winter, Wyman Cos. in Waltham, Mass., says demand for contract recruiters from its clients was up more than 85 percent between the third and fourth quarters of 2009.

Griendling adds that his company, DoubleStar, was hired by four new clients in a recent 60-day period, and it has its "largest new business pipeline in the last year and a half."

Freelancers may be in line ahead of staff recruiters, too. "Small to mid-size firms are bringing the search function in-house [by] hiring ex-search consultants to be their in-house recruiter on a contract basis," Nucci says.


A New Model

Another strategy being used as companies try to do more with less: Many are asking hiring managers and employees to take on more staffing responsibilities. Some experts believe this trend could continue for some time, so even after some semblance of a professional recruiting operation is restored, veteran staffing professionals may not recognize it.

"The hiring manager will no longer just be the end of the road for hiring decisions, but also the person identifying talent," Finnigan says.

"Hiring managers, although not experts in recruiting, will be forced to be," Salmon agrees.

Also taking on more recruiting tasks, according to Salmon, are ordinary employees in other departments. "Responsibility for recruiting has been pushed out into the organization," she says.

Finnigan calls it a whole-company approach to recruitment. "Employees will be called upon to make referrals and publicize jobs. Even executives will need to be on the front lines. … Referral hiring is the nirvana of recruiting," but it’s not easy. So, he says, companies are asking employees to tap into their personal online social networks. Instead of posting and advertising job listings, businesses are seeing if they can get their first round of applicants through referrals.

What is lost with this strategy, Salmon notes, "is the expertise in recruiting, particularly the recruiting of passive candidates" by staffing experts who have built their own, focused networks and developed the skills to manipulate them efficiently.

Using professional recruiters is still "the best way to find the right people," Salmon says.


Recruiting Recruiters, Finally

Eventually, organizations will become too lean. "Once it gets to that point, companies are going to realize that their people are working 24/7 and are maxed out on productivity," Craighead says. "When people scream and say, ‘I can’t take it anymore,’ they will have to hire."

He adds, however, that businesses are unlikely to rehire experienced recruiters back to pre-recession levels. "Companies will act cautiously in rehiring them," he says.

Finnigan concludes that companies are going to hire recruiters eventually, but not until after a lot of other things happen. "When you see that spike, you’ll know we’re in a recovery," he says.

In recovery, Finnigan predicts, the recession will leave a sharpened emphasis on the bottom line. "Before companies are going to build up recruiting staffs, they’re going to ask for the [return on investment] in doing so. … Before HR will get approval to hire more recruiters, they will have to answer the question, how much money must we spend?"

______________________________________

Steve Taylor’s most recent article for Staffing Management magazine, “Sometimes More Is More,” appeared in the October-December 2009 issue.
______________________________________

Reprinted with permission from the Society of Human Resource Management (SHRM) for inclusion July 15 - September 15, 2010. Taylor, Steve. "The Return of Recruiters". May 5, 2010. Accessed online at http://www.shrm.org/Publications/StaffingManagementMagazine/EditorialContent/Pages/0410taylor.aspx on July 15, 2010.

Recruiting Lessons From the Olympics: Learning From Outside Your Box


Olympic photo © VANOC_COVAN

Olympic photo © VANOC_COVAN


You will never become a world-class recruiter if you restrict your learning to benchmarking against other similar corporate recruiting functions. Great recruiters can and do learn many things by studying completely different business functions like sales, marketing, branding, supply chain management, quality control, and customer relationship management. In addition, great recruiters proactively try to learn from non-business industries as well, including universities (top student and sports recruiting), political campaigns, and even cloudsourcing initiatives.


Olympic teams are one of the top five recruiting "centers of excellence" that reside outside of the corporate world. The others include professional sports franchises, entertainment production firms, not-for-profit organizations, and the U.S. military. Even firms considered recruiting superstars like Google, Zappos, DaVita, Deloitte, and Microsoft can learn valuable lessons by studying the recruiting process used by Olympic teams. Obviously these "outside your box" Olympic recruiting strategies and tools must be modified to fit your own business situation, but it takes pure arrogance to automatically assume that great recruiting is restricted to the corporate world.


Narrow-minded People Instantly Dismiss Sports Analogies


Many leaders/managers in HR hate sports analogies; it's one of the key differentiators between them and other corporate leaders. Maybe it’s because in sports there is such a strong emphasis on competing and delivering results, and softer factors like values, effort, equal treatment, and "giving poor performers another chance" are relegated to the sideline. Senior corporate leaders outside HR realize that success in sports requires more than physical talent. It requires great managers, excellent training, a winning strategy, great tools and technology, and mental toughness. Books written by CEOs routinely include sports analogies, and their speeches are frequently peppered with sports terms like teams, coaching, “crush the opposition,” “give me the ball,” etc. Successful sports heroes and coaches also see the similarity because they frequently write books on leadership targeted exclusively for business consumption.


Olympic recruiters successfully attract the very top performers away from their careers, their families, and even their professional sports team salaries for an opportunity to literally "work for free" in a job with a less than a 5% chance of earning a shiny medal with zero resale value. Whether you like sports analogies or not, the Olympic recruiting model warrants your attention.


Valuable Recruiting Lessons That Anyone Can Learn From the Olympics


The four main lessons that corporate recruiters can learn from the Olympic recruiting include branding, sourcing, assessment, and top grading.


Let’s begin with lessons that can be learned in the area of branding. There are two basic approaches to branding any employer. The first approach is the "what we say" approach. It's named that because in the vast majority of organizations that employ it the brand position and subsequently all brand messaging is developed by a relatively clueless group of HR committee members who paint the organization as they would like it to exist versus how it actually exists or how it would need to exist to attract the right talent. Organizations practicing "what we say" branding place messages in highly controlled situations including on billboards, paid advertising, glossy brochures, and on corporate websites. The weakness of the "what we say" approach should be obvious...the messages are not credible among the target audience and are dismissed as nothing more than traditional corporate propaganda.


The second approach to branding is the "what others say" approach, where organizations accept that employment brands are developed through direct/indirect experience with the brand, and that the most credible brand messaging is developed and spread by the target audience itself. The Olympic team relies on "others," namely former Olympians, spreading the word about the prestige of becoming a member of the Olympic team. Their message is spread virally and is not controlled. Just as with any major corporation, some former Olympians share their negative experience. Relying on others to spread your message is cheaper than an advertising-supported approach, but more important, virally spread messages are viewed as more credible, more believable, and more real by the people the brand needs to influence most. (Viral messages are rarely perfect, pristine, PR packaged, fluff pieces!)


The U.S. Olympic Committee has done an exceptional job influencing a brand that positions becoming an Olympian as an opportunity to do "the best work of your life." As a result, young athletes line up for the chance to become one, often investing every penny earned into training to become even better. Once a team member, they dedicate hours to working hard, often with little or no pay and a miniscule chance of success. A few go on to earn big endorsement deals, but a much larger contingent work hourly jobs with companies like Home Depot to earn a living. In the corporate world, Zappos is a great example of how an employer brand message can be effectively spread using the "what others say" approach.


Olympic Sourcing Excellence


Attracting or sourcing athletes to apply to the Olympic team is also a practice that corporate recruiters should learn from. The Olympic team doesn't post openings on Monster.com or procure booths at job fairs; instead it uses referrals by current and past team members, and uses sports association teams as farm teams. Olympic recruiters recruit for positions that offer no pay, require hours of intense work, provide few benefits, and offer little chance of reward. (There isn't much demand for curling champions in the advertising world!)


Olympic recruiters focus on the excitement of the work and the thrill of the competition. They highlight the opportunity to work with and compete against the very best. The pitch is simple: becoming an Olympic athlete isn't a job, it's an honor, a privilege, a dream, and a once-in-a-lifetime opportunity. In the corporate world, although many know of Google’s free food and perks, it’s actually the excitement and challenge of the work itself that is the most under-sold attribute of the job.


A Candidate Assessment Approach That Everyone Should Copy


The Olympic assessment process for selecting candidates for the team is a process that every corporation should strive to emulate. You can classify the two basic approaches to candidate assessment as either "word-based" assessment or "performance-based" assessment.


Almost all corporate assessment uses the word-based approach. People often use the phrase "anyone can lie with statistics," but the fact is that most people prefer to misrepresent or lie "with words" as opposed to numbers. The vast majority of corporate assessment processes rely on analyzing words in every stage of the process from resume screening to interview to reference checks. Candidates who successfully use the right words, tell the right stories or give the right examples, are often selected without ever having to prove they are the best performer.


Behavioral interviewing is a commonly used tool that relies heavily on candidates weaving a tale about past reaction to specific circumstances, discounting the multitude of factors that render the circumstances completely incomparable to those the candidate will likely face on the job. Overall, relying so heavily on words to make your assessment probably means that those most skilled in the use of words are likely to get the position, even if the position itself doesn’t require a great deal of wordsmithing.


The Olympic assessment process is superior because its assessments are based solely on performance under actual job conditions. The "job content" or results approach doesn't care if you are eloquent, if you went to Harvard, if you have 10 years of experience or if your mom is the head coach. You only get on the team if your performance exceeds that of all others. In order to ensure consistent performance over time, some of the Olympic teams even require outstanding performance over a series of events in order to be selected. Because the Olympic assessment approach is clearly laid out in advance (there are no surprises during it), and because it is almost 100% objective, an extremely high percentage of candidates are willing to fully complete the assessment process without complaint.


There are several lessons that the corporate world could learn from this performance-based assessment process, namely:



  • Allow zero tolerance for hiring errors. The performance of every new hire must be assessed and a failure analysis must be conducted whenever you hire someone who doesn’t end up performing to team standards.

  • Spell out the assessment process so that candidates know what to expect and what is being assessed.

  • Use real job content simulations to assess actual probability of performance. Give candidates a real problem that everyone has agreed on in advance as to what constitutes poor, good, or a great performance. The problem should be selected from among those problems that the new hire would face during their first few months. In cases where it’s not possible for safety reasons to put the candidates through an actual problem, verbal simulations should be used to ensure that the candidate can at least "walk you through the complete steps" of an excellent solution. In the corporate world, almost all airlines already assess pilot candidate performance via virtual simulators.


Firms like Toyota and GlobalEnglish make potential hires actually work on problems with a real team. These tryouts serve a dual purpose. They allow the candidate to demonstrate their results, as well as giving the candidate a better opportunity to more accurately know what they are getting into.


"Top Grading" Really Works


In Olympic recruiting and selection the goal is to have 100% top performers in every role.


In the corporate world, "top grading" is the term that many use for this strategy of staffing. A significant number in HR argue against the top grading approach, proposing that it is too expensive, that there are not enough top performers available, or that managing a whole team of top performers is simply too difficult. I find it interesting that I have yet to meet a single top performer who doesn’t support a top grading approach where top performers who are also team players are the sole recruiting target. Top performers almost universally want to work alongside and learn from the very best and they see average performers as a distraction from overall team excellence. In the corporate world, Google is the next example of a corporation wanting to put top performers in every role and to drive away average candidates.


Final Thoughts


If you are watching the Winter Olympics, it’s easy to view the games as merely entertainment. However, if you look behind the scenes at the processes that support the teams, you’ll see an extremely sophisticated recruiting approach that rivals any in the corporate world. It’s a long-term process that literally started years ago and that will begin again as soon as the Olympics end. The process is so effective, that in the case of the U.S. team, it will most likely result in the most medals of any team in the world. Their talent acquisition process really is that good and it is certainly worthy of being copied by any corporation that strives to be world-class in recruiting.


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