What future for recruiting? (Guest blog from Bill Boorman)

For a while now I’ve been changing my views on the future of recruiting. I have a feeling that the market is going to look quite different once we have shaken off the shackles of recession. I didn’t always think this way, but over the last year I have been building a fantastic network via social media channels. My network consists of an eclectic mix of HR professionals, Recruiters, Vendors, technologists and others that live around the talent area globally. This combined input which has come via twitter, my 3 radio shows on blog talk radio, various blogs, linked in, latterly the wave and other channels have led me to these conclusions. This is how I see recruiting evolving over the next 3 years in a nutshell.

1: Corporate companies that have looked to cut cost during tough times will continue to do so in the boom times. I see this taking over much of the generalist market with HR teams taking on much of the lower end recruiting and traditional recruiters retreating further in to specialist niches where they can show real expertise.

2: The upshot of this will be more generalist recruiters opting for a very low cost option based on the job boards. The latest figures out of Australia demonstrate that the post and pray method still dominates the sector. This was very much the standard delivery model during the boom year’s post 94, where speed was valued ahead of quality of service to either the candidates or the clients. I don’t blame recruiters for this; both the clients and candidates drove the market this way by creating intense competition for limited resource. Post recession, the corporate recruiters have wised up to this and realised that they might as well do this themselves at a greatly reduced cost. Those recruiters that are unable or unwilling to change what they have always done have increasingly resorted to low fee or flat fee charging relying on volume. I believe this model combined with direct recruiting will dominate this end of the market.

3: Recruiters will continue to find new ways of offering the same service. Packaged and priced differently. An over populated market means more need to change their offering to differentiate. Over the last months I’ve seen models that pay large bounties for referrals from the network, that charge a fee based on time spent regardless of result or volume of recruiting, recruiters who have switched to providing a managed consultancy service charging for outputs in work over hourly charges and even Aquent have moved to a purely exclusive or retained basis, changing the way they interact with clients in the process. I applaud this creativity but equally believe it will change the recruiting landscape. Essentially the job we do will be the same, but we will package it very differently.

4: Recruiters will continue not to get social media. Despite the outraged posturing of the many bloggers and commentators this is actually o.k. I say this because the majority of the global population are much the same. Forget the stats you see, if you conduct a poll on LinkedIn asking how many recruiters have recruited via LinkedIn, unsurprisingly the results look favourably on the channel from where the opinion was elicited. Rather controversially I also believe that those recruiters that don’t get it won’t disappear. Personally I’m rather glad not many do, because it leaves the field open and unpolluted for those of us that understand the best way to network. The volume of recruiters that do nothing in LinkedIn groups other than posting jobs demonstrates the risk of damage to recruiter’s reputation as a whole by not contributing.

5: Relationships between clients and candidates will become the currency of the market. Increasingly, wise recruiters will return to managing fewer candidates that they understand properly (as a result of interview over registration) will change the way candidates choose who they want to represent them. Candidates in skill short markets will know they hold the balance of power and will be looking for real partners in their job search over those that do little for them. Equally, clients will choose to work with fewer recruiters and will expect regular contact, feedback and help. They will also look to their suppliers to be subject experts that can advise and help rather than purely process.

These are my thoughts for the coming year. I’d love to hear if you disagree! Be ambassadors for the business!

Twitter: @BillBoorman

Blog: http://recruitingunblog.wordpress.com/

Website: http://www.billboorman.co.uk

Email: bill@billboorman.co.uk

  • Posted by Greg Savage
  • On December 8, 2009
  • 5 Comments

5 Comments

Alan Whitford
Well, Bill hasn't left much more to be said. Great post Bill!
Gareth Jones
Welcome over to the dark side Bill! Glad to see your views have changed over the last year. Some interesting thoughts and i would obviously concur with many. 1. companies will indeed continue to keep costs down as we emerge from the recession, principally because the market, and therefore profits, will not grow substantially for some time - years, not months. 2. Job boards will indeed see increased usage from direct organisations. In fact, many job boards, especially the publisher based ones are potentially betting their success on it given that the rate card for corporates is way higher for them at the moment than it is for recruitment agencies - take note inhouse recruiters! Of course, in some areas this is influenced by volume. but if more companies do use boards then i don't see this price differential holding as corporates wont stand for it, volume arguments or not. If job boards lose further revenues they had planned to receive from corporates this could be a real challenge for them. 3. Clients will always need to hire and candidates will always need to find a job in a client organisation. That dynamic will never go away. And as with most markets, there is room for a value added 3rd party. But it wont be the standard recruitment agency business model we have today, which is what i was trying to make clear in my blog posts and tweets with you in the past. It is being marginalised, and even berated as a charging/delivery model and unless we embrace that need for change we will, over time, disappear. Which leads me onto.. 4. You are right, most do and will not get social media. If, as you say, clients and candidates will want fewer, richer relationships with recruitment agencies, however they may look in the future, then the recruiters who dont get SM or the need to change will indeed die simply because most will not have the volume of business or the required fill rate to sustain them over the longer term. And getting back to point number 1 - volume is not going to return in the way that provided such volumes for many years. 5. The candidate has always been the currency. Unfortunately, for many years recruiters missed this completely, bleating on about being 'client driven' all the time (But even that was pure cobblers for most of them) Moving forward, the legacy of social media will mean that the 'community' will be the currency. Regarding job seeker behaviour im not sure why candidates will shift to 'looking for real partners in their job search' - where is their incentive to do this? As @mervyndinnen pointed out in his post, there are a lot of job seekers out there that have never really had a good experience with recruiters and are unlikely, unless there is some seismic change, to change their opinion. Also, i can tell you from real front line experience that the large blue chip organisations will not, and have not in the last 5 years, been strategically positioning third party recruiters to be 'subject experts that can advise rather than purely process'. It's process all the way im afraid in many of these large businesses. Ask @Mervyndinnen - he is at the coal face every day and if you talk to his candidates and clients - which we do for his annual appraisal ;) - they will be hard pushed to find a more committed, honest and value added recruiter. Yet he will be able to share his frustration at how distant and process driven the larger clients are becoming despite his best efforts. The recruitment agencies face big changes but many, as you say, cannot and will not make the kind of change necessary because it means investing in things that go against their DNA. Currently 91% of job seekers see job boards as the most effective tool, followed by search engines at 51% and coming in third are recruitment agencies at 30%. (Source: Stepstone) Compared to 10 years ago, that shift us huge. I remember when job boards entered the market, usage of agencies was probably the number 1 criteria and many said job boards would not make an impression longer term. Another thought provoking post - what a rich subject this is!
Rob Davidson
Interesting comments, many of which I agree with. I am CEO of Davidson Recruitment, a mid sized recruitment firm employing 40 consultants in Brisbane, Australia. Undoubtedly social networking will change the way we recruit to some extent but I feel it is too early to accurately predict what the impact will be on the 3rd party recruiters. We have been investing heavily in training our staff in these areas. We are yet to see significant results but I am convinced it is a great medium term investment. In the immediate future, job boards and tradtional sourcing channels will still dominate. When faced with any area of uncertainty such as this, I always look my own business as a case study of one. This shows me how trends are impacting the way in which we operate and provides an indicator of what may be happening with our clients. We have recently employed six new consultants. Of those, one was a former staff member, one we sourced ourselves and four came through rec to recs. Modesty aside, we are regarded as one the top employers in our city and a number of those who applied to us through agencies openly told us we were the only firm they would consider moving to and yet they ignored our internet ads and chose to use an intermediary. This points to another factor at play which I think is overlooked in the discussions to date - human nature!! We are still dealing with human behavior and while technology will impact there still seems to be a preference for many people to apply through an intermediary where possible. We can speculate about the reasons. Clearly a small number of 3rd party recruiters do provide valuable career advice and deserve to be paid for their role. That does not explain why some candidates still prefer to apply through some pretty average recruiters - I wonder if it has something to do with an innate fear of rejection and many people like to have a 'buffer' between them and the client to ease the pain if they are not successful. Whatever the reason, our own experience tells us that at least for the foreseeable future there will still be a role for agencies. I fully agree with your comments Gareth about the larger clients - they will continue to build more sophisticated internal hiring teams and will come to rely on external recruiters less and less. Most economies however are driven by the SME sector - this is where i see the real future for specialist recruiters who can add value to candidates and clients. Regardless of the sourcing channels, between the twin factors of a lack of time and resources combined with the quirks of human nature, there will always be a role for recruiters in this field, and I think a growing one. As a final thought for both internal and external recruiters, it is interesting to read the comments of James Canton, one of the worlds leading futurists. He predicts that by 2020, global headhunter will be one of the top five jobs on the planet
Dan Nuroo
I do have a simplistic view of the world, as I'm sure both BIll and Greg now know. Bottom line... people will go where the value is. PERIOD. Companies will want the talent, adn the talent will always be looking for interesting work, whether they are actively hunting for it or not. Funnily enough the method will differ from Recruiters (Agency and third party) to job seekers and their situation. Both have to be aware of what the others are doing or the search is doomed for failure. ie companies and candidates will use agencies whilst the value proposition is there. Therefore the challenge is to ensure you know your value proposition! Recruiters (internal and third party) will use social media whilst the value is deemed to be there, let's face it, if you can't find your talent there, why bother. Job Seekers will go to job boards, will google and network to get jobs. Effectively whatever it takes, which stream, depends on the person and what they know about job search. Job search is not something people really enjoy doing and therefore they don't know the ins and outs, hopefully it doesn't happen that ofter. Relying on just one area will not work. I agree that relationships will continue to be the key, and the methods of that happening, whether it be via social media, email, coffee etc will continue to be individually assessed.
Matthew Ross - Roskow
(For the record, I'm not a recruiter, I'm an independent financial adviser in Melbourne - hope my input is of value to this discussion). Our industry, the financial services industry is undergoing substantial change similar to the recruitment industry. The way we do business is being challenged with good reason too. Two of the hardest issues to deal with are also the two that are providing to be of most reward - reviewing how we price our services and understanding where the value is in what we do. Being on the inside, it's so easy to lose track of where the value is in what we do - I can see evidence of this above. I would love to hear feedback on my points below - am I right, wrong, is this a fresh way of looking at things or am I missing an important point...but here's where I see some issues and opportunities from what I've read so far: - Dan Nuroo, simple view of the world? You don't give yourself enough credit - your comments were very insightful. You mentioned that relationships were the key and I agree 100% and this is your currency. Someone earlier suggested that candidates, being client driven or the community is the currency; I have to disagree, the relationship recruiters establish and maintain is the currency. Social media to some degree is standing in the way of this...my next point discusses this. - Social medias are a strategic tool to have in your toolkit, to have a presence, to help establish yourself as an expert - but my fear is some people rely on it too much. Is sending a tweet as valuable as a phone call in establishing and maintaining a relationship? It ain't and it never will be. The more social media becomes popular, the more valuable picking up the phone and calling someone will be. The balance seems to be starting to get out of whack - it's a balance of both. In my limited experience on Twitter there seems to be a lot of one way traffic, relationships, if they are going to be built, need to be two way. - Recruiters becoming specialist niches - as an outsider, I thought that this is what you all did!!! If there are many that don't, then I'm not surprised so many are under pressure. I do think that this is an area that could be improved, using my own industry as an example. There are only 15 independent financial advisers in Australia out of 18,000 which has stunned many recruiters who specialise in financial planning. When I chat to recruiters who specialise in financial planning and ask them questions about our industry, they're not attached enough to us. Across all professions there is a high proportion of people that don't want to get 'too close' to their target market - keep it as just business; this is what separates the wheat from the chaff - having the courage to immerse yourself in your clients lives and become that expert. If you're being forced that way, then good, cause so are we, and it makes perfect sense, because then and only then will you be of high value and can charge high fees. - One last point - coaching candidates - it's been a while since I applied for a job through a recruitment firm, but I have had a lot of experience with it earlier in life having met with 20 recruitment firms whilst I was in the UK a few years ago (finding contract financial planning work wasn't easy - but I found it!). During that time I always felt like I was applying for the job, hoping that I'm the right candidate for them; not once did a recruiter give me a pep talk and say "what type of work do you want to do?", "what sort of firm do you want to work for". What did you hate about your last job, hate about your last firm, love about your last job, describe a job, which if you were to find it, you'd stay for life. Maybe this is a bit idealistic, but my point is, if a recruitment firm got a reputation for having well prepared candidates that were interviewing the firm as much as the firm was interviewing them, the company who is paying the fee would have more confidence that they were going to make a good decision employing that person if they knew that the candidates were of higher quality; so it requires the recruiters to have a deeper understanding of the values of the company and the candidate; recruiters would be semi-qualified psychologists because of the issues involved. I think it's an area that could be investigated more because not only does it make it easier to illustrate where the value is, it allows for premium pricing and results in raving fans who refer more work because the experience was so successful. Your role is to find people who are better quality than what we can find - having the right people in the company is as important as having the right full forward, five-eight, striker, point guard in a professional sporting team. People provide the ability to be successful and if you can deliver a higher probability of achieving this, then you'll be able to charge premium prices. The chances of finding those people through social media is low, because the good candidates are focusing on work, not facebook.

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