Recruitment Innovation: Size Doesn't Matter

Recently, an executive from one of our larger clients visited the Seven Step delivery center, and while she was here, led a meeting with the recruitment teams assigned to her business. She used the time to flesh out her teams' understanding of her company's unique mission, business model, and culture. It was a great meeting.

Her thoughts on "innovation" were particularly interesting. In her company, they draw a clear distinction between "big-I Innovation" and "little-i innovation." Her point was simple: innovation comes in a number of ways, and innovations don't have to be paradigm-shifting to be important. The accumulation of small breakthrough ideas matters, too. She stressed that companies need to pay attention to both the "big I" and the "little i" if they want to build a truly progressive culture.

I agree. In fact, Seven Step's genesis was a small idea that quickly grew into something quite big. Seven Step knows well how much the "little i" matters.

We believe that the accumulation of "little i's" can be much more powerful than the rare "big I." In baseball terms, we believe in winning by getting on base as frequently as possible. Homeruns certainly have their place, but relying on homeruns exclusively isn't a winning strategy. Of course, homeruns with men on base is the surest path to victory of them all. The same is true in prioritizing your quest for innovative ideas, both small and large. It's important to get on base.

The other advantage to paying attention to smaller-scale innovation is that it typically doesn't involve incremental cost or resources, at least at the onset. This is important, given the budget constraints many companies face today. According to PwC's 15th Annual 2012 Global CEO Survey, 31 percent of CEOs said they weren't able to innovate effectively due to resource constraints. I wonder how many of that 31 percent were thinking only of "the big-I," and the costs that are involved in that? Would they have been so pessimistic had they been thinking of the (often free) benefits available via smaller-scale innovation?

All companies can focus more effectively on "little-i innovation" by creating better ways to mine the ideas that probably already exist in their teams. Here are a few simple suggestions:

• Monthly ideation forums: Have teams meet once a month to exclusively discuss new ideas.
• Recognition strategies: To foster an ongoing innovative mindset, create monthly or quarterly awards for the best new ideas. Make sure to reward the small ideas as well as the big ones.
• Twenty percent rule: Daniel Pink's bestseller "Drive" talks about the success companies like Zappos and others have had in building an innovative work culture. He suggests that executives encourage their staff to dedicate 20% of their time each week to looking for new ways to improve the company. By structuring this commitment and giving people the license to pursue their ideas, the innovation engine goes into full steam.

Innovation is not an event; it's mindset. Build a culture where innovation — of every size — is always on tap and you'll guarantee your organization always stays ahead of the competition.

Recruitment Innovation: Size Doesn't Matter

Recruitment Predictions for 2012

It's a new year, and that means it's time for predictions of what 2012 has in store for talent acquisition.

Google+

Google+ will gain a strong foothold in the social media market and become a top resource for recruitment. Crazy, right? I thought I'd start off with a bold one. People may disagree but Google has too many great features to just die out. The tipping point is on its way. Google Hangouts are really cool, and the live direct-to-YouTube G+ Hangouts are even cooler. I think we'll see some companies host Hangouts as a way to directly connect with their talent communities. The possibilities don't end here. Ever since Google opened up the API a couple months back it's been one slick enhancement after another.

Talent Communities become a Top Source of Hire

Talent communities are starting to become more popular, and with the rise of the connected consumer companies won't be able to dispute their effectiveness. Keeping candidates engaged will be crucial. Employers no longer control where engagement occurs like they once did in the "destination web". Connected consumers now curate their own content, and content comes to them. If companies aren't giving prospects a good reason to opt-in by extending the employee value proposition, candidates will seek that engagement elsewhere. To employers that don't already have a talent community: you are already behind. Please reach out to discuss further!!

We All Become Human Capital Analysts

Data is the new oil that keeps hiring initiatives run smoothly. Vendors like Avature CRM, CareerBuilder's Talent Intelligence Portal, and Jobs2Web have armed the talent acquisition pro with real-time insights into the talent market. I see this prediction pairing with the decline of the HRIS Reporting Analyst job function. With these vendors making data easily accessible, it no longer requires someone in HRIS to build them. And why should I have to wait to configure an ATS report?? I want to pull data on a hunch and look at it from five different directions. Data-driven decisions need to happen NOW. We don't have time to wait 2 days for a report.

Veterans Get Hired Back To Work

Unemployment rates among young veterans are highest in the country. However 2011 saw new tax incentives and proposed DOL regulations to help out the cause. Beyond this, employers know that this candidate pool is a wonderful talent pool ready to be tapped.

RPO Industry Sees Another Record Year

Of course, this is a big one for RPOconvo. As the recession continues to subside, employers are looking for simple, effective ways to bolster their hiring initiatives. RPO is the answer.

What do you think? Would you add anything else to the list?

The Candidate Debt Ceiling

So for those that don't have a radio, TV, friends, coworkers, newspapers, or a water cooler, you may not have heard that the US debt ceiling was increased. For the rest of us, this marks unchartered territory in our nation's history. And now the super committee is working on a solution to propose in the next couple of months. Now, I don't intend to get political at this juncture, after all it's not surprising how many situations can be critically affected by the variables of spending, debt, and return on investment. However, I thought it might be interesting to point out that it is these very same variables that are in play at the heart of the RPO marketplace. So, for those with maxed out HR budgets and out of control Costs-per-Hire, today I'm going to point out the difference between Corporate hiring dept ceilings and those of an RPO.

First, let's take a look at the "Corporate Hiring Debt Ceiling". In order to define what a debt ceiling looks like in recruiting, we need to look at three variables:

1. Cost-per-hire
2. Candidate salary
3. Employee return (revenue produced)

Now we can start to figure out the Employee Return on Investment (Employee return minus cost-per-hire and salary). Let's take a look at a couple examples in a traditional corporate hiring environment:

Sales Manager Cost-per-hire = $10,000 Candidate salary = $80,000 Employee Return = $160,000

Software Architect Cost-per-hire = $50,000 Candidate salary = $100,000 Employee Return = $200,000

So outside of traditional overhead, the total net profit for a first year Sales Manager in this case would be $90,000 [employee return – (cost-per-hire + candidate salary)]. For the Software Architect, it's even less: $50,000 [200k – (100k + 50k].

In summarizing the findings, internal hiring teams have the luxury of falling back on the candidate's return. The Candidate Debt Ceiling is defined at the point where cost-to-hire and salary begin to outweigh the employee's return seen here:

You can see that an internal hiring team can afford to let the cost-per-hire skyrocket and the employee's cost can still technically can go into the 'win' column when compared against the revenue that employee brings in once employed.

Now take a look at the cost-per-hire in an RPO pricing model shown below. It's distinctly different in that the employee hired never goes to work for the RPO. The employee works for the RPO client. Therefore any revenue that the employee generates doesn't credit against the RPO's cost-per-hire.

So the placement cost paid by the client becomes the RPO's Debt Ceiling. This restraint requires an RPO vendor to manage cost, act efficiently, and maintain a cost-per-hire below the Debt Ceiling, because as cost approaches that line it becomes decreasingly cost effective. In the end, working with an RPO ideally provides a client with a clearly established debt ceiling, streamlined hiring operations, and reduced hiring costs.

So why does this happen? Are internal hiring teams incapable of managing hiring costs in the same way? I think so, but it's a big shift for many organizations. I picture the auto industry in the early 1970's. Auto makers kept pleading that regulating emissions would put them out of business. It would be impossible for them to turn a profit producing energy compliant vehicles. However, once the EPA put forth a deadline all the automakers got it done. It was possible the whole time; they just didn't have a strict regulation urging them to act. Without outside pressure, it's hard to make that kind of change. But this is what a good RPO has already figured out. An RPO has that cost-per-hire Debt Ceiling that requires smart operation. The RPO debt ceiling is that pressure that ensures even, fixed hiring costs for any client.

Rules of Engagement

Recruiting is all about relationships. When it comes to engaging candidates, the landscape is continuously changing. Years ago, no one used LinkedIn, no one used Twitter. Social media has fundamentally altered the environment in which we recruit. But outside of social media, there are other factors that illustrate this point. According to the most recent Career Xroads Source of Hire Report survey, employee referrals are still a top source of hire. The report also shows an increase in social media hires. Being a sourcing professional myself, I'm always anxious for this report to come out each year as a way to benchmark our clients against "the norm", but from an engagement standpoint we can see that it is the relationship that influences the hire. We've also seen that companies with a strong brand connection can see hires from aggregators that rely on SEO increase as much as 500% in recent years. Job boards are less of a starting destination as they are a landing page for a quick Google search. Brands with a strong connection can receive immediate engagement from applicants.

Basically it all boils down to one very simple formula:

Brand + Engagement = 1 very successful hiring method

As an RPO service provider, often times our #1 asset is the client brand. Behavioral statistics surrounding social media prove that there is a cultural shift in how people consume and make decisions. A strong client brand can make all the difference, as seen in the research for Drivers of New Product Recommending and Referral Behavior at Social Network Sites, which stated fairly obviously that a referred brand is more likely to result in the desired engagement (sale, contact, response, etc). Consumer marketing has known this for a long time, but so far in my experience I've always been surprised by the companies or service providers that take this for granted or, even worse, don't utilize their brand at all for recruitment purposes. If you are hiring within a company with a strong Business à Consumer brand, then there are already thousands of people out there that want to work for you! You just have to engage them!

No, I'm not talking about slapping up some logos or videos on your career page. I'm also not talking about spamming jobs out to LinkedIn. I don't care how many resumes you have in your applicant tracking system, either. For employment purposes, no one wants to be a random resume posted in an endless job board database or an applicant in a black-hole ATS. Now it's all about engagement and relationships. What I care about is what you are doing to engage those people. Do you have any remarketing campaigns? Are you maximizing your employee referral program? Do your recruiters have a face and are they available? Do you have a CRM to manage relationships? If the answer is no, why not? The good news is that many of the tools used to do this (like social media) are free to use. All it takes is a little time, some commitment, and some best practices. Maybe it's time to walk down the hall to the marketing department for a little while. Observe, and then let's try some of it in the recruiting space!

Recruiting During the Economic Recovery

The global economic recession that began three years ago has presented a myriad of disparate economic effects that have fundamentally changed the way that business functions. For example, tightened credit standards have made expansion into new territories or markets a more tedious and stringent process than before. Like creditors, hiring managers can now be much more selective about forming new relationships (in this case, with new employees). Naturally, it is the duty of a recruiter to adapt to this new environment and adjust his or her approach to produce the best candidate pool possible. Often, this requires a fundamental alteration of what the industry has traditionally practiced.

There's no arguing the fact that many good employees have fallen victim to corporate downsizing and cutbacks since 2008. Indeed, there are few things more satisfying than extending an offer to a candidate who has been unemployed for an extended period of time. However, in many cases, layoffs also targeted employees whose skills or initiative were less refined than their counterparts. Therefore, in this new era of hiring practices, companies often find themselves unsatisfied with the caliber of their direct applicants. As such, it becomes necessary to mine other resources for qualified individuals, some of whom are content in their current positions. For recruiters, this is an increasingly integral part of our job.

When people ask me what I do for a living, I often describe it as "professional networking." Whether I'm looking at an engineer that posted his resume on Monster six months ago, a profile on a LinkedIn professional group that I've joined or a friend-of-a-contact who may or may not have moved to Oklahoma in the past few years (true story), my colleagues and I are constantly on the prowl for the perfect (albeit passive) matches for our open positions. It's a thrill to call a new number and think that this could be the candidate that gets the job and, if not, he or she could lead me to whoever will.

This new, proactive approach to recruiting is now necessary in order for a company to stay competitive in the marketplace. It's more effective, to be sure, but requires a good deal of effort, finesse and tact. Passive candidates need to be courted and sold on a totally different level than traditional applicants. Hiring managers and HR departments, however, rarely have the time or resources needed in order to fully perform such a practice. Think about it: how would your traditional responsibilities fair if you were expected to provide the equivalent of a nonstop professional mixer event? This is where my colleagues and I are invaluable. We deliver not only a high-quality candidate pool, but do so with an innovative yet simple process.

The accolades we receive from our clients are a true testament to the efficacy of our services, but so are those we get from the candidates we find that weren't even looking for a new position. It's a nod to the combination of HR, sales and marketing strategies that RPOs provide. When you take all of this into consideration, it can really make you wonder how companies got by with the old, traditional recruitment process. Thank goodness for innovation, eh?

Setting Realistic RPO Goals

All RPO initiatives start from the same place: a company has a hiring need that they cannot meet internally. That is not to say that this hiring need is companywide. We sometimes take hiring projects for the local office of a larger company. To meet the hiring need of the client it is important to set realistic expectations from the start.

Clarity is key for all parties. Clearly express what you expect from your RPO provider. If I am told what a company is looking for from our partnership I will be able to set up the best practices to meet those goals. In return, it’s helpful to the provider if the client is open to hearing the kind of support the provider needs from you so we can develop a working relationship which will translate into a more successful launch.

Lastly, the devil is in the details. And it’s best to get this details up front before go live. Inevitably there will always be things that are outliers in any process, even the most strict of process designs have variables that just won’t come up before the provider is in the situation. As part of the goal setting set escalation contacts and an open line of communication for that first 1 to 3 months of go live (or forever!). Set goals to meet at least 1 once per week to go over themes of issues and brainstorm solutions together. Schedule multiple face to face meetings so that trust is developed and the partnership gets cemented. If you bring your outsourcing provider closer you will get serious gains.

The Trickle Down Effect in RPO

Selecting an RPO provider that works best for your company's goals and culture is just the beginning of a successful RPO transition. After the dust settles and you are through the selection process you and your RPO provider will have conversations about how you can actually work together instead of discussing hypothetical scenarios. The real question becomes: where to begin?

Let's look at it from my experience with a new RPO initiative. I have come to the conclusion that a successful transition can be broken down into five simple steps. There is no need to get complex, just stick to the basics!

Yes, I stole that Trickle Down Effect title from an economics professor from college, but it still applies well here. If you want to make this transition successful from the get-go, support needs to come from the top. If the HR Business Partners or Talent Acquisition Professionals aren't behind this partnership then the hiring managers won't be behind it either. It is important for everyone to work together and not have different factions of employees working against each other. This partnership is meant to benefit everyone involved so it is important that the decision-makers support their own actions. If there are questions stemming from hiring managers about why this move was made, make sure you go to bat for your RPO provider. If you sound confident in the RPO's abilities, your hiring managers will feel and share that confidence.