Is Agency recruitment going to be ‘uber-ised’ ? The answer here

Is Agency recruitment going to be ‘uber-ised’? The answer here.

At least twice a month I am approached by an HR Tech startup with a ‘new’ idea to ‘disrupt’ the recruitment industry. Plenty of these guys (and occasionally, gals) are super-smart, and all are earnest, (sometimes fanatical), in their belief that they have found ‘the holy grail’.

In many cases, indeed I think most cases, it’s very early in the conversation that I am told, ‘we will be the Uber of recruitment’ or perhaps, ‘we plan to uber-ise the defunct agency recruitment model’.

And I start to weep inside.

Trust me, LinkedIn will have joined MySpace before agency recruitment gets ‘uber-ised’

Here is why.

Mostly, the HR Tech idea guys do not understand where the value in recruitment is. Almost always their model is to ‘connect the job seeker to the employer and thereby cut out the middle man (recruiter)’.

In some cases these ‘new ideas’ are virtually impossible to differentiate from job boards.

The false premise this entire thinking is based on, is the belief that it’s matching of candidate profiles to vacant job descriptions that cracks open the golden recruiting egg. And the HR tech boys and girls can get pretty excited about that because indeed, algorithms can make that match.

But often they don’t ‘get’ that ‘matching’ is the very easiest part of the recruitment process.

These are the hard parts

• Identifying candidates who are not looking, but who will fit a hard-to-find skill set.
• Approaching, enticing, seducing, and bringing those candidates to the hiring table.
Managing the hiring process, negotiating terms, finessing the brief, handling the counter-offer, assisting with on-boarding.

There simply is no technology yet, that makes any discernible inroad on replacing these key ‘human’ recruiting skills.

Don’t get me wrong, technology will change the face of recruitment, and wipe out many dinosaur recruitment agencies that do not adapt and evolve. Indeed there are some HR tech businesses who are building sophisticated talent communities and developing predictive analytics to address the issues I raise above. Even the smarter job boards are getting with the program.

They did not ask me, but here is some advice for the HR Tech dudes who want to ‘change recruitment’.

Come up with technology that improves recruitment by humanising it more, not less. Don’t try and ‘change’ recruitment by dumbing it down even further.

Every piece of HR tech you ever dream up… ask this question, “Does this technology improve the candidate experience, or not’.

Remember these words every second you plan your ‘next big HR tech revolution.

Talent is NOT an online commodity.

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The Savage Truth Speaking Tour continues on and on. Coming up; London, Glasgow, Dublin.. probably South Africa too….

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About Greg Savage

Over a career spanning thirty years, Greg Savage has established himself as a global recruitment leader. Greg is a regular keynote speaker at staffing and recruitment conferences around the world.

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45 Responses to Is Agency recruitment going to be ‘uber-ised’? The answer here.

  1. Elias Cobb March 15, 2016 at 9:17 am #

    Excellent article, Greg, as yours always are. I’ve been trying to push the human side of recruiting for well over 10 years! The bigger problem, as I see it, isn’t the tech boys and girls trying to cut out the middle man as it is that the end clients, the ones who pay all of our bills, by and large don’t appreciate what a good agency can do. Those tech guys are simply trying to grab the money that the end clients so reluctantly spend with agencies. Good agencies are worth their weight in gold, but we need our clients to recognize and appreciate the value we bring.
    Elias

    • Mo March 16, 2016 at 10:41 am #

      This is akin to governments, who, having done a bad job, never face up to it but instead blame their problems on communication, or lack of.

      Recruitment agencies need to bring value to their clients before they can expect any recognition for doing so. Unfortunately, there are many (not all) out there that simply do not do that.

  2. Clarke@Dynamo March 15, 2016 at 11:04 am #

    I agree. In a nutshell I would say that recruitment is more of an Art than a Science.

  3. Callum March 15, 2016 at 11:11 am #

    Well said. I have come across companies who have received millions of dollars in investment for a technology which simply matches keywords from job descriptions to those in CVs.
    I always wonder which companies are actually buying this.

  4. Rich March 15, 2016 at 1:05 pm #

    Where does LiveHire fit into this?

  5. Alan Allebone March 15, 2016 at 3:03 pm #

    Just get those candidates who are hard to find, hard to convince and PLACE them.

    Don’t be shy to call them, track them down, head hunt them maybe not today or tomorrow but the next day!

    WHY?

    Because todays candidates are tomorrows clients!

    regards

    Alan

  6. Navid March 15, 2016 at 7:16 pm #

    Hi Greg,

    Great post and mostly very true. I disagree with the point you have mentioned about analytics around candidates and getting smarter per say.

    The deal is that candidates you find through building “analytics” are often candidates who have built their resume or online profile to be found through “analytics” because they are busy trying to find out whats out there than performing well.

    I cant comment about general candidates with common skills because I have never hired those. Niche candidates are found (and they entertain conversations) when an agent proactively has meaningful conversations with them.

    This is the reason why recruitment industry has survived today. Otherwise Monster.com alone (when it came about in late 90s) was enough to eradicate the industry, it would not even have made it to linked in.

  7. Nicky Farmer March 15, 2016 at 7:28 pm #

    I’ve never met a programme, app or system with a gut instinct, and without that, you are nowhere in Recruitment !!

    • Adam Gordon, Social Media Search April 3, 2016 at 12:53 am #

      Take a look at Beamery or Clinch.

      • Ben Slater May 10, 2016 at 2:05 am #

        Hey Adam, appreciate the shout out! We like to think that we’re doing something a little different at Beamery!

    • Fiona April 5, 2016 at 11:59 am #

      So true Nicky. There’s a place for HR Tech to enable us (recruiters) to work more effectively- sometimes they hit the mark and others don’t… They look great- have all the latest bells and whistles but unfortunately forget that they are there to be used as tools to enhance productively and provide is with time to do those human activities such as engaging in conversation; or out there walking the floors of our customers and clients.

  8. Matt Churchward March 15, 2016 at 8:06 pm #

    The great irony being that in many cases the very clients who would be interested in moving away from the agency model and attracted to tech solutions are the same clients who view recruiters as key word ‘matchers’ and not worth the fee.

  9. Mike Theodoulou March 15, 2016 at 8:10 pm #

    Agree overall. If you are recruiting for quality permanent people, there will always be a need for great recruitment agencies. I am biased but think tech can help the high volume, temporary and shift work side of recruitment a great deal.

    I think one of the reasons why entrepreneurs think that cutting out the recruiter will help is the bad quality of a lot of recruiters. Why not just match people online, when all they do is spray and pray profiles anyway and charge a fat fee when they get lucky?

    A lot of people out there don’t appreciate the value a good recruiter can bring, simply because they’ve never experienced it.

    • Alex March 16, 2016 at 12:46 am #

      Mike just hit on the real problem! The reason why we’re hated as an industry and seen as more trouble than we’re worth is the high percentage of terrible agencies on both the permanent and contract side. This makes clients want to cut us out and gives Tech HR a window of opportunity.

      Of course there is a place in the market for both Tech and Agency, especially while so many of our peers devalue the human service.

      P.S. If anyone would like to invest $1m in me, I have a killer idea that’s going to revolutionise recruitment.

  10. Anthony Hesse - Property Personnel March 15, 2016 at 9:28 pm #

    Great post yet again Greg and very reassuring to read that old codgers like me still have a future in the business :) All the best Anthony

  11. Ian Gibbons March 16, 2016 at 1:43 am #

    Greg, sorry I disagree with about half of what you said. But firstly, what HR tech companies don’t realise is that Uber just makes things easier and cheaper, but it’s still a taxi service; they still need cars and people. This is the same in recruitment. Today, the need for offices, company cars, directors, office staff etc…is no longer required. Take these overheads out, work from home, engage with a community that’s often left the recruitment sector due to the sales environment but have amazing sourcing skills and all of a sudden you have new offering that like Uber, combines humans with technology.

    • damian eyre March 22, 2016 at 8:34 pm #

      People go to work to be part of something and this social aspect of work is often more important to people than the other benefits. There is a place for what you mention and I am sure it can be very successful but it can’t be the norm. Comparing Uber is comparing Apples and Oranges.

    • Heidi Lancaster March 26, 2016 at 6:20 am #

      Here is the problem with this theory. Good recruiters have candidate control from their initial interview and then throughout the relationship process. If your candidate doesn’t see the value in meeting face to face, chances are they are going to be a pain in the butt at every turn. Skype/Facetime interviews are just like viewing products online VS in person. You don’t always get what you think you’re getting and the candidate thinks they’ve got the upper hand, because they didn’t have to expend any real energy to meet you.

      I’ve said it before and I’ll say it again: the real value of good recruiters is their personal connection and vested interest in each and every candidate and client. That starts with the initial conversation, follows with the face-to-face meeting, and is carried out in every communication going forward. You can’t replace this with en entirely work from home recruiting situation. And no, meeting in a Starbacks is not the same as a distraction free office or interview room.

      • Anthony Hesse - Property Personnel April 8, 2016 at 11:11 pm #

        Amen to all of that Heidi – excellent response!

  12. Tom March 16, 2016 at 3:54 am #

    i’ve heard some really exciting things around a US company called hired.com; on face value really could be a game changing model. Has anyone else come across these yet?

    • Adam Gordon, Social Media Search April 3, 2016 at 1:11 am #

      How is it any different to a job board database?

      • Glen April 23, 2016 at 10:55 am #

        In addition to organically drawing in talent, Hired.com uses “talent advisors” to recruit in-demand IT talent into their platform and companies access the platform to bid on the folks (approach with potential offers). The cost to make a hire on the platform is about half of what an average agency would charge.

        They claim they will achieve a run rate of $100M this year.

        • Greg Savage April 23, 2016 at 11:19 am #

          So Glen, they are basically a cheap recruitment agency? And revenue does not equal profit, so lets wait and see

          • Glen April 23, 2016 at 12:33 pm #

            In one sense, yes. They do largely eliminate the sales-side of agency recruitment, and clients self-serve from the platform. I believe they claim they will be profitable this year, although I am not sure where their significant costs are outside of the platform they’ve developed. They have very low human capital overhead relative to their volume of hires, and of course there are no commissions to pay out.

            They do pay healthy referral fees to people who refer others into their system who get hired.

          • Greg Savage April 23, 2016 at 12:38 pm #

            Its an interesting model and I will watch with interest. if they are hiring “talent advisors” and those people need to be relatively smart and have influencing skills, which if they are “recruiting in demand IT talent” they will need to have.. then their staff costs WILL include incentives or commissions one way or another.. no doubt of that.. but we will see when they call for funding, go IPO or sell… or go bust..:)

  13. David Willis - 33 Talent March 16, 2016 at 4:31 am #

    Great post Greg, thanks for sharing.
    Tools make the identification piece easier for everyone, but the real value add from good recruiters is totally in engagement, and ability to manage all the little nuances that make the difference between a successful and unsuccessful hiring process.

  14. James Galvin April 2, 2016 at 3:09 am #

    Uber for Recruitment would not be connecting companies with job seekers. Uber doesn’t exactly cut out the middle man, because you still need a driver. It takes the hassle out of it. It standardises the terms of engagement, moves the service to an on-demand model, sets dynamic pricing based on demand. I believe there are plenty of opportunities where these principles can work well in recruitment, e.g., engaging freelance sourcers or screeners on demand, particularly in industries that have a high proportion of active candidates, or for smaller companies that don’t have a small recruitment team and irregular hiring. Obviously it’s not just going to “end recruitment agencies”, but I wouldn’t be so swift to dismiss attempts at innovation in this space.

    Having said that, I do agree that people are overly focused on the match-making aspect of active candidates to open positions, while other parts of the recruitment life-cycle still have a lot of juicy problems to solve.

    • Greg Savage April 2, 2016 at 12:37 pm #

      Thanks James… good comments…. although I would point out very clearly that I have not been “Swift to dismiss attempts at innovation in this space”. I have been watching innovation in recruitment more closely than most for 35 years.. hardly ‘swift’.. I have been “pitched” and assessed several dozen HR tech start ups in the last three years alone. I have even invested in some! I have given it more thought than anyone I know… and what’s more my blog explicitly said this below.. which baldly states that innovation will affect this space.
      Don’t get me wrong, technology will change the face of recruitment, and wipe out many dinosaur recruitment agencies that do not adapt and evolve. Indeed there are some HR tech businesses who are building sophisticated talent communities and developing predictive analytics to address the issues I raise above.

  15. IMS April 2, 2016 at 1:29 pm #

    Thousands of recruiting companies operating from India as their offshore operations with US phone numbers.
    Geninue hiring companies in North America is hard to find especially in IT field.
    Question open to all, does the US constitutional law say, H1,L1,F1,K1,L2 & student visa are entitled for Green Card & Citizenship.
    Will the lucrative business of Visas by hiring agency overseas put to end by Homeland.

  16. Adam Gordon, Social Media Search April 2, 2016 at 7:49 pm #

    In summary of this article:

    – Click-bait title
    – Most rec-tech businesses don’t get recruitment
    – Some do and are going to change the industry
    – That’s all folks..

    In summary of many of the comments:

    – Clients don’t understand the value of good recruiters
    *Well actually, they do, which is why most have hired a load of them.

    • Greg Savage April 2, 2016 at 11:49 pm #

      In summary of this comment from “Adam Gordon”
      – Smart-arsey
      – ignorant
      -devoid of any value add, insight, or anything of assistance..at all
      -otherwise he sounds like a really top bloke
      -That’s all folks

      • Adam Gordon, Social Media Search April 3, 2016 at 12:44 am #

        I normally avoid your stuff as I disagree with much of it but read this because of the compelling title.

        – I didn’t however read about any specific tech that is claiming to be anything like Uber
        – All I read was, some rec-tech’s not going to change the industry and some is good
        – And I actually do know of various products which are very effectively solving the first two challenges you’ve mentioned – getting hard-to-reach passive candidates to move

        • Greg Savage April 3, 2016 at 1:11 pm #

          Its a pity Adam that you do not have the manners or self-control to actually use my blog as a forum for debate, discussion and learning, rather than being demeaning and dismissive. It looks possible that you have something interesting to say. I could learn from you if you would take the time to say it.. civilly and respectfully.. avoiding sarcasm, belittling and arrogance. Hard as it is for you to believe, (seeing as you “disagree with MUCH of what I say”), you could maybe learn something too.. if only your attitude were different, and your mind a little more open.

          I have published all your comments, and will continue to publish whatever you post hereafter, but I am done with this conversation, as there is clearly no room for real idea-sharing here, sadly.

  17. Adam Gordon, Social Media Search April 3, 2016 at 6:42 pm #

    Greg, I believe you are correct that a lot of recruitment technology girls and boys are making big statements that actually make insignificant, incremental differences to problems which barely exist. Now on to your three key issues that are important:

    – Passive talent for hard-to-fill roles
    – Enticing, seducing etc
    – Managing the hiring process, negotiating etc

    I don’t believe the latter can ever be automated.

    The first two however are being automated through a combination of nurture marketing and demand generation platforms. I’ve mentioned two in previous comments. I don’t think the earliest entrants will become mainstream as I don’t believe they are run by people with any recruitment experience. GetTalent from Dice however may well be the breakthrough platform which addresses them.

    I am personally not too dismissive of rec-tech’s ability to disintermediate recruitment agencies. Things are coming which the mainstream recruitment industry has never heard of.

  18. Fiona April 5, 2016 at 12:19 pm #

    Adam- pardon my ignorance to the in’s and out’s and terminology that social media gurus like yourself use – but my understanding of your comments would be classified as the following -wouldn’t they …???
    https://en.m.wikipedia.org/wiki/Internet_troll

    • Adam Gordon, Social Media Search April 14, 2016 at 8:50 pm #

      I wouldn’t personally say being critical of a blog is trolling Fiona, no.

      • Fiona April 15, 2016 at 2:14 pm #

        Fair call – appreciate your comments and views Adam… from my perspective it was just taking away from the discussion and topic; and maybe those contributions from others that I personally like to take away after reading one of Greg’s blogs.

  19. Tai April 9, 2016 at 7:54 am #

    I had an interesting call this week with a techie who had been working on his own startup…

    He asked if I had a look st his website which I sheepishly said no, when he hadn’t worked for 18 months I had already made up my mind on whether I was interested in meeting with him.

    Interestingly he told me that his startup was at funding stage and it was an application to connect clients with candidates through an advanced algorithm. It would screen the companies current team and then ask a series of questions to the candidate to check culture fit. Then they would go through technical tests etc… he actually said the recruitment needs a shake up and be Uberised. Greg, having already read your article and come up with my conclusion prior to this conversation I listened without tearing his dream apart and poking wholes through his 18 months of work.

    There are so many flaws in the program which I think in right deserves its own blog… so look out for a piece next week!

    • Tai April 9, 2016 at 7:56 am #

      P.s apologies for the typos, I am going to use the writing from my phone excuse!

  20. Scott April 22, 2016 at 8:47 pm #

    Recruitment is an art that takes real skill.

  21. Scott April 22, 2016 at 10:04 pm #

    great blog.

  22. Glandu May 6, 2016 at 6:44 pm #

    Hi.

    I’m on the meat side, here. I’ve been an IT consultant in France for 14 years, and now that I’m working for a software vendor, I’m occasionally in contact with your colleagues.

    And I agree with the idea. You can automate a search for standard, common talent, but for specific positions, you are going to need to adapt. Most very requiring tech jobs do not have a real match in the real world, but still, people who don’t match now can be easily trained. Or not. The only way to know if they will adapt is to know them.

    Most commercials in french IT consulting are plain crap, but I had a very clever one, at the end. He told me “most people just look at the ad, browse their database, and try to make keywords match. This approach never works. Each time I’ve done this, the contract did end badly. You’ve got to know people, what they can do, what they cannot do”.

    Amen.

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