Is RECRUITING getting the attention it deserves?

If you’re a small to mid sized company who has decided for any number of reasons to handle the recruiting side of your business in house, there are a few things we’d like you to think about as you make plans for the  future. We say this in the context of how tough it has been for most smaller organizations to navigate the complex candidate landscape that has been in play for the last couple of years. (SPOILER ALERT – it is not projected to get better.)   

Obviously, we’re biased, but compared to what recruiting was like just a few short years ago, its clear that to win the “race for talent” companies need a much higher level of recruiting expertise, resources, and tools to compete for talent. This is particularly true for small to mid sized companies where missteps on the people side of the business can be costly.   

As we think about what has happened to the recruiting function over th last 10 years, we’re simply not sure that it makes sense for most companies to try to beef up their recruiting resources internally, when its so easy to outsource this function to the right recruiting agency partner.   With your larger competitors getting access to new AI driven recruiting tools, leveraging their recruiting outreach by tapping into an expanding list of recruiting “best practices”, and with your own jobs constantly changing in ways that puts most of your job descriptions in various stages in “misinformation”, it’s getting more and more challenging for companies to win in the candidate marketplace without making substantial investments in the recruiting process.  We know first hand that the costs of the full blown recruiting expertise you need (staff and technologies) just to get in the game, have skyrocketed.       

The purpose of this blog is to give you some things to think about when deciding about best ways to manage the recruiting side of your business. We’d like to make the case that for a small to mid sized company who don’t do enough hiring to support the costs of developing a professional recruiting function in house, now is not the time to hand off recruiting to an executive assistant or even a senior manager who lack the specialized expertise it takes to win in today’s candidate competitive marketplace. In fact, we believe that finding the right recruiting agency/partner is like finding the right attorney or CPA – giving you access to a special level of expertise it would be tough to develop internally without compromising the investments you have to make in your core business.   

Here’s some things to ask yourself about how your current recruiting practices are working….

  

How quickly are you able to hire?    

The time it takes to hire a new employee is considered one of the most important metrics in recruiting performance. And oddly enough for as fast as it seems, the digital marketplace has done very little to actually speed up that metric. Given how easy it is for candidate wannabes to click their way thru the first stages of your recruiting process, we suspect that some of your job postings will produce anywhere from 100-200 submissions, others might produce only 5 or 6, depending on the kind of employee you’re looking for, how you write your job posting, and the availability of the candidate you  need to hire in the open market.  

And while 100+ resumes from one job posting may sound like good news, with less than 10% of those submissions coming from candidates who have the basic skills or experience to do the job, you can see how easy it is for the digital marketplace to create a recruiting “can of worms”. That’s a lot of resumes to review, a lot of phone screens to conduct, a lot of candidate chasing just to get a chance to say hello.   

When the time it takes to hire increases, as the data suggests it has over the last couple of years, so do the costs associated with the hire. An unfilled position is never good for an organization and is often the cause of frustration by team members and leaders in other groups that count on yours to perform.  We call it the costs of “lost opportunities.  

The recruiting data we read suggests that “time to hire” metrics for all employers who are hiring on their own, are at an all time high, ranging from 35-65 days from point of job posting to job offer. And that doesn’t count the time it takes to do the pre-recruit homework or the post hire compliance. That’s a whole lot of time that companies are having to spend dealing with “lost opportunities” with no guarantee that their new hire will be successful. The time it takes to hire is problematic for all companies but particularly for small to midsized companies who can’t afford delays when opportunities strike.     

One of the most important values we know a recruiting agency partner can deliver for your company is to help you reduce the time it takes to hire. Cutting your current “time to hire” in half, would be a reasonable goal for you to set with your outsourced staffing partner.   

 

Are you hiring the “right” people?     

A common sign that your recruiting function needs a second look is when you look around and see your company’s performance or its culture moving in ways you never intended. If you start to see employees hired because they’re “likeable” rather than really good at what they do;  employees who really don’t like their job and don’t mind telling anyone who will listen; employees who don’t never quite get on board with your mission – these are signs your recruiting and hiring process needs a tweek.     

A great recruiter is really good at finding candidates who not only have the skills or experience to do the job, but knows how to select candidates who can and want to do the job well, people who,  once hired,  will exemplify the organizational values, goals, and culture you want to create. And those are skills that are not easy to develop unless recruiting becomes someone’s full time job, a full time career for someone in your organization.  

Whenever performance and culture starts to fade it won’t be long before you start to see negative bottom line impacts, and the fix often lies with who and how you hire. 

By partnering with the right outside recruiting agency you suddenly have access to a team of recruiters who have made recruiting their career choice.  Thru the years of experience they have devoted to their craft, they have developed the professional expertise it takes to turn your casual hiring process into a business process with a defined purpose.   And while this type of expertise doesn’t come with small price tags, the benefit for you is that you will no longer be hiring people who have the right AI generated resumes, but candidates who have been professionally vetted to be the right “match” for the kind of company culture you are trying to create.   

 

Has unwanted or unnecessary turnover taken a toll on your business?  

The average cost of replacing an employee has been estimated to be upwards of 150% of the employees salary.  And that’s not including the impact on productivity and morale that occurs when a team is stretched too thin because someone they just hired was either unable or unwilling to do the job.  The data we read suggests that somewhere around 50% of the job postings in the public marketplace reflect are needed to replace employees who were hiring mistakes.  This gives you a sense of how costly it is for an organization to treat the recruiting function too casually.  With 35-50% of all hiring decisions turning into hiring errors within 12 months of hire – if you’re having more early after hire turnover than you think you deserve, chances are the recruiting side of your house is in trouble. 

There’s many reasons why the right recruiting partner can help you avoid the most common hiring mistakes. First of all recruiting agencies typically have access to sophisticated candidate vetting tools and have the specialized expertise you need to guide you thru a structured hiring process that focuses on the kind of candidate who is most likely going to be successful on the job.  At PACE we use what we call a Results Focused Hiring process and have countless examples of where this process has allowed us to dig deep into a candidate’s talents and motivations to either avoid a hiring mistake, or identify a true winner.   

 

What is it actually costing us to hire if we are only using internal resources?  

Yes, using a professional recruiting agency involves paying a fee for each person they find and you hire.  It does appear from time to time that you are saving money by handling all the recruiting in house.  But by the time you factor in all the costs you incur by having your people divert from your core business to spend time on the hiring process, that just may not be the case.  Do you really want a hiring manager spending time reviewing resumes, chasing down candidates who aren’t returning their calls ,or scrolling through LinkedIn trying to find talent? Do you really want your admin assistant spending days reading through resumes, doing phone screens, or arranging interviews for candidates who never show up?   

Contrary to popular opinion, our clients who use us as their recruiting partner on an ongoing basis,  tell us that their primary driver is to save, not spend, money.   And keep in mind that not all recruiting agencies price or deliver their services in the same way.  At PACE, for example, we’ve created very affordable pricing models quoted as flat fees up front and include built in guarantees and payment plans.  We think you’ll be surprised at just how affordable it might be to get access to the kind of expertise and tools it takes to make a difference in who and how you hire.         

 

What can a third party recruiting agency do for us that we can’t do for ourselves?  

That’s a great question as it allows us to talk about the hidden benefits of choosing to outsource a business critical process service. You typically get a lot more than the specific set of deliverables you signed up for.  You get a set of expertise and resources that would be incredibly costly (if not impossible) to develop internally.     
 
Here’s just a short list of some of things that we bring to the table makes such a big difference to what our clients get by choosing to call PACE rather than trying to hire on their own….
 
We’re in the candidate marketplace 24/7.  We’re not a start and stop recruiting operation like most of our clients cobble together when recruiting and hiring on their own.  Our networks of candidates and referral resources date back decades. We know our clients have access to candidates who are clearly part of the “hidden” market that they can’t tap into on their own.       
 
We play a huge role in facilitating communications between candidates and employers. We know our employer clients well – what boundaries they have to work with when making a job offer, what opportunities they can really offer candidates long term. We also know what motivates our candidates to accept some offers and not others – things they are not likely to share with a prospective employer if working with them directly.  Our third party/ neutral role in the process allows communications to flow between candidates and employers accurately.  We won’t let a hiring process go sideways simply because there of a misunderstanding, delay, or even a misstep by either a hiring manager or a candidate somewhere along the way.          
 
We are great consultants – not because we are smarter than our clients  – but because we are exposed to so many different types of business scenarios and staffing challenges. We have a wealth of information and data to pull from to advise our clients about the availability of candidates with certain level of skill or experience, and what they might cost to employee them. We also offer optional ways for employers to get work done – knowing that hiring direct is but one of several ways to navigate complicated labor markets.
 
We get our clients prepared to hire right. We walk them through the necessary homework to land on the right candidate profile for the job. We help them write job descriptions that are focused on performance and results not a long list of must haves that makes it so difficult to hire in a tight candidate market. We don’t just know how to craft the right job postings to capture the right candidate’s attention, but we know where the right candidates hang out that are not actively looking for work.   We also know how to present each client’s job opportunity in ways that is both accurate and compelling – that creates a win for both the candidate and their employer down the road, not just on day one.
 

What do I need to be thinking about if I truely want to keep the recruiting function in house?      

The costs of keeping your recruiting function in house depends on what lies ahead for you and the people side of your business. How many and what kind of people will you need to hire over the next 12-24 months? If you anticipate having to hire and develop professional recruiting function in house, what staff, equipment, and tools will you need to be competitive in the race for talent?   How might you want to augment the work you can do in house by outsourcing some of the more tedious and time consuming components of the recruiting process?  Are you job postings delivering the kind of talent you need or is it time to target some jobs for more strategic recruiting support – finding candidates who aren’t actually checking the job postings?   

 

How Can PACE help?

Of course, the answer to this question is a long list of things we can do to help you make good decisions how best to develop and manage the recruiting function.  We have many clients who have spent the time and money to develop small recruiting teams who need help from time to time with higher level jobs that are mission critical.  We also provide “hiring help” for companies who want to outsource certain components of the hiring process – such as writing job descriptions, vetting candidates for particular skills, creating structured interviews, etc.  Our full service recruiting packages are priced to make them affordable for small to mid sized businesses who can’t afford to pay fees based on a high percentage of the employee’s annual pay.   We can train your hiring managers on how to conduct interviews that will actually reveal differences between candidates on the factors that matter to on the job performance.  In other words, our “help” can be as varied as you need it to be.    

And if you decide to opt out of the recruiting process altogether and outsource that function to a recruiting partner, we’d love you to consider PACE as that potential partner.  We’d love an opportunity to walk you thru our network approach to recruiting and the many ways we’ve made a difference to Northwest employers in who and how they hire.    


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