Talking About the Future of Recruitment

by Mervyn Dinnen

The 'Future of Recruitment for Agencies' was the theme of the latest conference hosted by Recruitment International. I joined a number of speakers from across the agency spectrum talking to around 60 businesses about upcoming trends and how they could best navigate the changing landscape.

My session covered what the large corporates were doing, how talent acquisition was changing, and what role there might be for agencies in the future. I wrote on a recent Broadbean blog about the the reasons for using recruitment agencies, and during this presentation I expanded on that.

Here's an overview of what I said:
CURRENT LANDSCAPE

I started with a look at how the recruitment industry is performing now. Recent insight reports show an improving sector with confidence returning, even if the volumes are still below 2007/08. Total turnover value is almost back to pre-recession levels, with one difference. The perm/temp split has moved further towards the latter. In fact perm fees are down by nearly 45% from 07/08 whilst the number of consultants working solely on permanent business has reduced by a similar percentage. The average perm fee has also dropped, from £5,800 in 07/08 to £4,000 in 12/13.

I also used current Broadbean data on volumes of permanent job adverts over the last 18 months compared to those in January 2008. In most sectors we now have higher relative volumes (very high in the case of manufacturing and engineering) whilst the three sectors still lagging behind 08 were secretarial & admin, call centre & customer service, and recruitment consultancy!

WHAT ARE CLIENTS DOING?
It is often assumed that the growth of in-house recruitment teams, together with a proliferation of CV databases and the rise of LinkedIn, have combined to squeeze the recruitment agency out as a primary supplier.

Whilst this might be partially true, to look no further would be to miss certain key underlying trends that may erode business even faster, but can also throw some light on how to develop. The four main trends are:

Connectivity
Are we at a 'talent tipping point'? There is certainly a belief that most companies are already connected to everyone they ever need for recruitment, and it is the identification of those connections that are key. Current employees, alumni, people who have previously applied for a role, customers, clients, suppliers, collaborators, social media fans - all have networks to leverage, and their networks have networks too. US research indicates that around 50% of roles are filled by internal moves, whilst a global business such as Sodexho can report up to 20% of recruits as re-hires. A 'talent shortage' is usually a 'finding problem' as we have the connections but need to find the best way to interpret and analyse the volume of data and interactions.

Candidates vs Applicants
First we need to make the distinction between them. Candidates have been matched to the role and are worthy of consideration. They now have a connection to us which we may need to utilise in future, as there could be a better fit for them at a later date. Applicants have applied for a role, and have no previous connection with the business. They are live until they have been matched to the role and are then either rejected or become a candidate. Most corporations are moving away from purely attracting applicants and instead are identifying candidates. One key differential is that the applicant relationship is short, whilst candidates have a much longer term relationship and it is they, not the hiring company, who effectively determined the length of relationship.

Sourcing not Resourcing
This follows on from the previous trend. Resourcing tends to identify volume, creating a long list of applicants who then will have to be assessed and measured against the role requirements and other potential candidates. Sourcing is much deeper and concerned with finding the candidates who match the requirements and can be considered for the role.

Employer Branding and Culture Matching
The corporates have an army of employees and customers to talk about how great they are, whether it's on social media or in conversation. Employer branding didn't start with the internet (there have always been iconic, aspirational brands and businesses), but they now have a much more visible platform and budget with which to showcase. Some large brands can attract over 2 million global applications a year, without even advertising a role, and we now have technology capable of identifying patterns in communication to help provide insight into personality and culture fit. Whilst smaller businesses don't have the reach, they still have a pull and can fill many roles without external help.

WHAT CAN AGENCIES DO?
Move up the Supply Chain
There is a danger that agencies could languish as a 'supplier of last resort'…a channel alongside CV databases and LinkedIn. Cost effective when the role calls for a large volume of CVs to be attracted and sifted, but not the primary channel. To move to a 'supplier of choice' we need to be able to offer something that can't easily be found elsewhere - something of value that helps the internal recruiter with their time/cost of hire metrics. We need to focus on finding candidates not applicants.

Expert Knowledge & Insight
Many in-house recruiters are generalists, whilst hiring managers can often lack current knowledge of the recruitment market. If we are true market, sector and skill specialists then we need to be able to offer that to clients. Be their eyes and ears in the market, with knowledge of trends, availability and perspective on particular niches. Talent mapping and insight reports could be part of the service, partnering with clients on the talent acquisition.

Extended Reach
Producing reports is only part of the answer. We need to be able to find the people that clients cannot, so will need consultants who are able to do this. Some talent is scarce, some skills unavailable, so we also need to be business advisors, able to provide alternative options to help clients find a way to solve their problem.

Content Marketing
Any research on workplace disruption will ultimately conclude that phone calls, emails and meetings are the three biggest distractions, costing a huge amount in productivity and efficiency. Yet how many agencies still rely on these three forms of communication? Many clients and hiring managers may drop calls and ignore emails so we need to find other ways to reach them. Using content to establish authorityand thought leadership within our sector is a perfect way. Create a body of written and visual content that demonstrates our level of insight and perspective, knowledge of our niches, and it can also attract candidates looking to deal with someone who understands their market. Host some small client events, maybe roundtable discussions, and use the content to create a downloadable report. It could do more for you than endless cold calling!

Differentiate through Consultants
The need for differentiation can best be achieved through your consultants. The future recruiter will need a different set of skills to be really effective, as the role gradually evolves to incorporate a varied mix of duties - connector, networker, marketer, sourcer, business adviser and project manager. For a consultant to take time to understand and become an authority on their sector - incorporating the key people, major businesses, upcoming trends and right contacts - may well require a different mindset and behaviours, and most probably different reward schemes too.

Thoughts From Other Speakers
Amongst the other presentations at the event were ones from Steve Ward, founder of Cloud Nine Recruitment, and Belinda Jonhnson, director of industry analysis and research consultancy Worklab.

Steve talked about how he grew his niche recruitment business and embedded himself in a growing community. He talked of being the go to recruiter in your niche and how to understand the audience. His 10 point guide is on the slide below, and he left us with the thought that a great candidate experience is when you get recommendations from people you never placed.

Belinda gave us a very thought provoking insight into employment trends and the impact that these could have for the industry. She left us with two thoughts about the future of the industry which all agencies will need to consider:

• If workers are increasingly rewarded on outcome, why should a recruitment agency continue to charge for the introduction?
• Task oriented working eradicates the need for vetting, checking and validation, in which case what else can agencies charge for?

It will be interesting to see how recruitment agencies evolve and adapt to changing recruitment and employment trends.

Tell us what you think or if you have implemented any changes within your agency to make you An Agency For the Future!

The Good, The Bad and The Cautious by Mervyn

conferences, Lawyers, social media, social media guidleines

Conference season is in full swing. In recent weeks I’ve attended four recruitment and HR conferences at which – surprise surprise – one of the burning topics was yet again social media.
Clearly it’s a subject that won’t go away – nor should it – but I can certainly detect a shift in attitudes with companies showing a distinct interest, even keenness, to embrace the opportunities.
Most heart-warmingly it was at Recruitment International’s seminar for SME recruitment agencies that I noticed a big shift. I delivered the session ‘The Key to Social Media’ which I started with the question ‘how many companies here have a twitter account?’ to find that over half did! Not only that, but they wanted to learn how to use them properly and get more from them!
I won’t repeat my session here. Suffice to say that leading them through the industry’s communication journey of phone and rolodex, to fax, then computer, e-mail, mobile and now social media highlighted that it’s an evolution not a revolution and companies will adapt much as they have done previously.
This approach helps to focus on the conversation not the medium. On participation, openness, conversation, community and the benefits of connectedness… and the rules of engagement as opposed to the fear of the unknown.
After all, with our previously preferred communication tools now seen as the biggest distractions in the workplace, and new trainees much more adept at communicating through social channels and messaging as opposed to the traditional land-line phone, this is a shift we may all have to accommodate sooner rather than later.
However it’s not all optimism and a sense of adventure at a conference now…there’s the ubiquitous presentation from a law firm to sit through. And don’t they see things differently!
We hear of benefits and opportunities from companies, then of problems and risks from the lawyers.
First we listen to positive outcomes from setting out guidelines and letting employees get involved, then we get told to have policies and limit, even outlaw, usage.
I have sat through examples from companies as diverse as Boots, ITV, Unilever and Ivensys of how social media has delivered positive recruitment outcomes – and then watched the lawyers talk about their 2 cases. They only seem to have 2 – Hays (now 3 years old) and Flexman (still ongoing, and facts as yet unclear).
Did lawyers ever give presentations about the dangers to business of the phone? Fax machine? Using mobiles?
And lawyers also always now seem to quote Neil Morrison! Since having some of his quotes published in HR magazines he seems to have become the lawyers’ poster boy for a trusting, laissez faire approach to tweeting in the work place. And they don’t agree with him! Presentations usually feature his quote “I don’t think you should have a social media policy – what you are saying is ‘we don’t trust you’” followed by reasons why you should have a policy!
A lot of this smacks of old business protectionism to me. I’ve sat through many scaremongering sections about keeping clients and contacts, the old ‘restraint of trade’ clause being replaced by the new ‘we own your LinkedIn contacts’ one.
But business is changing. Clients are savvier. If you’re an agency recruiter and your client contacts come from a PSL, or contractual arrangement, then they will clearly remain where they are – the firm has the contract. Where there is no such arrangement though, the firm can’t guarantee they will keep the business. They can try and stop you speaking to contacts but can’t guarantee that, if successful, those contacts will continue to give them business.
It may be that business finds its own way of embracing social in this area. Last year IBM hosted a Social Jam – a 72 hour online conversation, drawing on 2700 participants from around the world, exploring key issues around a social business strategy. I will blog more about this in a future post, but there’s one very relevant finding that I’d like to share:
“HR needs to embrace the fact that employees have their own personal brands that exist both inside and outside the business and that it does not own these brands but merely “rents” them while employees are at work. Personal brands need to be measured and rewarded based on how they help your company throughout the social network. As employees transition and become alumni of an organization, it becomes even more important that HR maintains relationships with its alumni network. Social tools can help provide a strong, dynamic way to keep the alumni network active and useful, enabling the organization to keep an invaluable source of knowledge, mentoring and connections.
In order to take full advantage of the capabilities, HR must work with leadership to expand and instill the use of social technologies in practical and significant ways—a fundamental cultural change. Information can get lost and conversations can taper off when email is the primary form of communication. “I think leaders have a responsibility, where it makes sense, to move people out of email,” a participant wrote. “I heard someone once say that ‘email is where information goes to die,’ implying that we lose something by forcing knowledge into that channel.”
Not sure how the lawyers will take to that one!
Let me know what you think…