Recruiting vs Talent Management

Recruiting vs Talent Management

Recruiting vs Talent Management

By Mike Myatt, Chief Executive Officer, N2growth 

I recently participated in a panel discussion about the future of the recruiting industry, and quite frankly, I was surprised with many of the prevailing attitudes and thoughts surrounding the topic at hand. As is often the case, I was the contrarian on the panel, and while I probably shouldn’t have been shocked, it was the fact most recruiters seemed to believe the status quo was fine, the future was bright, and they didn’t see the need for change that perplexed me. In today’s post I’ll examine the future of recruiting from a bit of a different perspective than many in the executive search business…

Those of you who read my work with any amount of frequency know how strongly I believe business is fluid, dynamic, and ever evolving. Furthermore, you are likely just as familiar with my position that a static business, which doesn’t constantly innovate around the changing needs of the marketplace is the same thing as a dying business. While many recruiters and executive search firms may think they’re exempt from the aforementioned business principles governing sustainability, they would be sorely mistaken to be so brazen in their attitude and approach.

The fact of the matter is both employers and job seekers continue to become more demanding in their requirements of one another. This phenomenon is occurring during a time where employment markets worldwide have never been more competitive. My question is this; Does this sound like an environment where service providers (namely recruiters) can stand idly with a business as usual attitude?  I think not.

The reality is in maturing and complex market environments clients’ demand more from their service providers. Executive search firms desiring to remain competitive must focus on increasing their value added benefits in order to stay in the game. Those recruiters who have incomplete service offerings, and who don’t completely immerse themselves in understanding the culture and environment at their client companies will find it difficult to eek out a living moving forward.

While my personal practice is focused on providing leadership advice and counsel to Fortune 500 CEOs, as the senior operating executive at our firm I also have oversight responsibility for our talent management practice.  From my perspective, I can’t imagine not integrating services throughout the talent management lifecycle. The identification, recruitment, deployment, development, retention, and succession of talent are clearly issues best addressed in an integrated service offering. Approaching talent management in a fractionalized approach is an inefficient and flawed process.

I am so committed to the beliefs espoused above that our firm engineered its talent management practice in a fashion which offers clients a broad array of service offerings. The simple truth of the matter is that it aligns our agenda with that of our clients, and makes for solid long-term relationships driven by much more than placement fees.

Here’s the thing – “recruiters” while filling an important role, simply don’t add the value a sophisticated client will desire in the future. Those recruiters looking to grow their business must transition from candidate sourcing to embracing a comprehensive approach to talent management aligning their interests with the long-term objectives of their clients. Executive search firms not working with their clients pre and post placement have failed to understand recruiting is no longer a business, but simply one component of a much greater process. Anybody can make a hire, but that’s not the end game – rather it’s just the beginning.

Thoughts?

10 Steps to Creating a Talent Advantage

By Mike Myatt, Chief Strategy Officer, N2growth

Creating a talent advantage begins with smart hiring. That said, it never ceases to amaze me at the number of people who are charged with hiring who possess absolutely no skill at doing so. While I rarely meet a CEO who is completely comfortable with the administration of the hiring process, most of them still seem to accept the status quo…”Who should do the hiring?” is a question more CEOs should spend time pondering. Here’s the thing; Anyone can make a hire, but not all hires are good hires. Smart leaders do more than just hire smart people – they have a smart hiring process and/or methodology. In today’s post I’ll share my philosophy on the best way to insure you hire tier-one talent.

Put simply; talent matters. The problem is that very few people actually possess the talent to identify talent. Identifying and recruiting talent requires much more than screening a resume and having a set of standard interviewing questions to guide you. There are issues of values, vision, culture, context etc., which need to be creatively and intuitively addressed in the hiring process. Sadly, it’s these areas that often go overlooked because the wrong person is evaluating talent.

Further complicating matters, is just because someone has succeeded in the past doesn’t mean they’ll be a success for your company. Likewise, just because someone has failed in a previous position doesn’t mean they might not end-up being a top performer for your company. Assessing talent is in fact a talent… Adding even more complexity to the hiring process is that not all those capable of identifying talent are capable of recruiting the talent by sealing the deal…Think about it, does the person in charge of your hiring process have the experience and charisma to convince a top performer at another company to take a pay cut to work for your company?

While CEO’s can’t personally be in charge of recruiting, it’s important to realize CEOs still own responsibility for the outcome – the buck always stops at the desk of the chief executive. No matter the size of your enterprise, I don’t believe recruiting should be the sole domain of HR (other than for lower level positions). Rather in most instances, I believe HR should be a part of the hiring team. The following commentary came from Steve Ballmer, CEO of Microsoft when he was asked about his philosophy on hiring:

“I did all the hiring myself for a long time. No one joined Microsoft without my interviewing them and liking them. I made every offer, decided how much to pay them and closed the deals. I can’t do that anymore, but I still invest a significant amount of time in insuring that we’re recruiting the best people. You may have technology or a product that gives you an edge, but your people determine whether you develop the next winning technology or product.”

I tend to be similar in positioning to Steve in that I believe one of the highest and best uses of time is to make sure we attract the best talent for our company and our client companies. I believe C-level executives can’t afford not to keep their hands in the talent function at some level. In order to ensure you make the best hiring decisions possible, I would strongly recommend you follow the practices listed below:

  1. Definition: Make sure you know exactly what you are looking for, both in terms of the job description, and the profile of the individual most likely to be successful in that role. If you can’t define what you’re looking for, you shouldn’t be looking.
  2. Timing: There is wisdom in the old axiom “hire slow and fire fast.” Don’t panic and end-up making a regrettable hire out of perceived desperation. Give yourself plenty of runway. You’ll be much better-off taking your time and making a good hire rather than using the ready, fire, aim methodology and end-up terming the new hire before they eclipse their probationary period.
  3. ABH: Always Be Hiring…Never let your organization be put behind the talent 8-ball, as great talent is rarely available on a moment’s notice. In the world of professional sports the search for talent often starts during the middle-school years, which is long before the potential talent being tracked by the scouts has matured. Your organization should always be on the look-out for great talent whether that talent is still in graduate school, in the military, working for competitors, or working outside the industry. Some of the best hires I’ve made over the years were executives that I spent months, and in some cases, years developing relationships with.
  4. Identify Your Talent Scout: Look for and identify the person within your organization that has the best nose for talent. Regardless of what position this person holds, get them involved in the process. If you don’t have a natural talent scout internally, seek outside assistance in the form of a consultant. Don’t turn your talent scout into just another corporate bottleneck, rather give them leverage by having them collaborate with outside recruiters. Outsourced recruiting is very effective and affordable if managed properly.
  5. Team Based Hiring: While I’m not generally in favor of management by committee, hiring based upon a team approach works very well. In a perfect world, a hiring team would consist of your HR manager (compliance), your internal and external talent scout (the gut-check), the direct supervisor over the position being hired for (competency, capability, and compatibility) and the senior executive who is the best at selling your organization (the closer). Hiring in a team based fashion eliminates many of the typical mistakes that can be made in the hiring process.
  6. Values Based Hiring: You can either spend time finding employees who share your organization’s values, or deal with the brain damage of managing conflicts that arise due to opposing values. Smart companies focus on the former and not the latter. It simply isn’t necessary to compromise on core values to get talent. A new hire should desire to be part of your company for more than the ability to maximize immediate earning potential…they should be interested in your company because there is a sincere alignment of values and vision. Trust me when I tell you that compromises in this area which seem insignificant during the interview process will become visibly and materially significant down the road.
  7. Hire Leaders: I have a basic premise when it comes to hiring – most companies get exactly what they deserve. When companies complain about a lack of leadership, or how difficult it is to identify leaders, my question is simply this: Why didn’t you hire a leader to begin with? Sure, leadership can be learned, but not everyone is willing to learn, and even if they are, education takes time and has a very real cost. Let me be clear, I’m not knocking leadership development initiatives – there is no perfect leader, and all leaders need to focus on development. What I am saying is that development of an existing leader is faster, easier, and more effective than creating a leader.
  8. Cultural Fit: Culture matters – forget this and all other efforts with regard to talent initiatives will be dysfunctional, if not lost altogether. Don’t allow your culture to evolve be default, create it by design. The first step in cultural design is to be very, very careful who you let through the front door. People, their traits, attitudes, and work ethic (or lack thereof) are contagions. This can be positive or negative – the choice is yours. The old saying, “talent begets talent” is true.
  9. Pay for Talent: I cannot even begin to count the number of times I’ve witnessed companies pass over the right hire, or worse yet, not even look for the right hire because they let self-imposed financial constraints serve as a barrier precluding sound decisioning. I’ve actually personally observed HR managers filter better qualified candidates because they were a few thousand dollars outside the “top-end” of the salary range. It is precisely this type of thinking that will keep a company from being competitive in the market. To put it bluntly, you get what you pay for…Real talent produces real results, and is worth the investment. Always hire up where possible…find the right talent and then do what it takes to secure the services of said talent. You cannot afford not to invest in talent.
  10. Constantly Upgrade: You can hire the best talent in the world, but remember that “best” is a subjective evaluation largely measured within the context of a snapshot in time. Obsolescence can take root in anyone if growth and development are not focus points. Development needs to occur at every echelon of the workforce  - the top, middle, and bottom performance tiers. Top performers need to be stretched, mid-tier performers need to be challenged to up their game, and you should always look to upgrade the bottom 20% of your workforce. This can be done through training and development or via new hires. You need to ask yourself the following question: Who are the least productive members of your team? Why? Coach them to productivity or replace them – there is no third option.

Hiring is a blend of art and science. The reality is that those organizations that identify, recruit, deploy, develop and retain the best talent will be the companies who thrive in the market place. As always, I welcome your comments and feedback below…

Should I Use A Recruiter?

By Mike Myatt, Chief Strategy Officer, N2growth

I recently received an email from a CEO asking the following question: “My HR department isn’t producing the quality of applicants we need. Should I use outside recruiting firms?” Since N2growth has a talent management practice which includes a practice group that provides retained search services, in order to be transparent I must disclose my bias before answering today’s question. While I clearly have a strong bias favoring an outsourced recruiting model, the question merits a bit of exploration in order to provide a fair answer. In the text that follows I’ll do my best to manage my bias and provide a transparent and authentic answer to a question I’m sure most of our readers have asked themselves at some point in time.

Let me begin by providing some historical background on organizational behavior which might serve as a useful backdrop for today’s post. While I could go as far back as Aristotle’s lectures on the topic of persuasive communication and self-awareness, to Plato’s writings on the essence of leadership, or even refer to Machiavelli’s work on organizational power and politics, for the sake of brevity and relevancy I’ll fast forward the late 1800′s in America. It was during this period of time we can find the roots of modern HR. It was during the late 1800′s industry recognized people problems were a very real and rapidly growing concern in the workplace. It was also during this time the US Government stepped-in to provide the first real legislative protections for the workforce.

As time has continued to march forward America has moved from the concept of “personnel administration” to “human resources administration” to “human resources management” and now we are moving on to “talent management.”  Nomenclature aside, the biggest challenge that HR departments face today is that of multiple and often competing agendas, which in turn tends to cause staffing inefficiencies often resulting in lackluster performance. As with the evolution of most functional departments in the corporate world, with the passing of time has also come some empire building and title inflation. The HR department is no exception to this regrettable state of dysfunction.

Let me ask you to think about your HR department for a moment – How large is it, how big of a budget does it command, and most importantly how productive is it? Upon reflection you’ll find that much of your HR department is likely charged with defensive posturing associated with managing compliance and litigation risk. Other staff members are likely charged with training and administration activities, some have fallen into IT roles developing applicant tracking systems and other support infrastructure, while others perform marketing and research activities surrounding candidate development. How much of your staff is actually charged with recruiting, and how senior are these people?

It is not that HR departments are incapable of making high volumes of consistently great hires, it’s just that most or not organized to do so. If your executive level recruiting is being handled by staff level HR shame on you (see “Who Should Do The Hiring“). Following are just a few reasons why I believe in most cases a company is better off leveraging the services of an outside recruiting firm:

1. Outsourcing allows companies to focus on core business while leveraging a broader, deeper and more senior recruiting talent pool than they normally can manage organically. The real issue isn’t internal vs. external, but internal and external. Talent organizations which collaboratively partner with executive search firms produce better results than those who don’t’. It simply doesn’t matter who makes the hire – what matters is the right hire is made.

2. When payroll costs, ad budgets, job posting fees, research costs, IT costs, lost opportunity costs, etc. are considered it is more affordable to leverage search firms. Why dilute your internal budgets on redundant efforts when you can leverage the budget of a search firm?

3. There are many benefits associated with using an outside recruiting firm including realizing the benefits of a confidentiality buffer which keeps the employer in relative anonymity until they are ready to engage with a candidate. Managing the noise of a high profile search is better handled externally leading to fewer conflicts, political hi-jinks, and the potential for leaks.

4. Recruiting firms have existing  long-term relationships with passive job seekers not readily known to most HR departments. A broader talent pool simply results in better talent being acquired. 
Recruiting firms also have broader access to a wider range of candidates who may not have ever considered working in a particular industry or for a specific employer.

5. No charge replacement guarantees makes using an outside recruiter a very low risk proposition.

6. Recruiting firms normally have access to a broader array of tools and information which can often be useful to employers in terms of efficiency, benchmarking and analytics.

Bottom line – the best results come from combining the knowledge and skill possessed internally with the competencies of external resources. Think collaboration – not isolation. Good luck and good hiring!