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In the global war for talent, the United States has always been able to rely on our strong appeal as a land of opportunity to attract the best and brightest talent from around the world. With the rise of other economies like China, India, and Singapore, we are seeing increased competition for these resources, and in many ways we may be at a disadvantage. It’s time to start thinking about America’s employer brand and the effect it has on our ability to recruit quality talent.

Whether you recruit in San Diego, California, or Lima, Ohio, you know how important location is in recruiting. It has the potential to be your greatest asset or present your greatest challenges. In order to make a potentially life-changing decision like changing locations, candidates will look at quality of life, cost of living, and the base of other companies and future opportunities available in your area. Where you live has a huge impact on who you can recruit. In the global talent marketplace, the United States has always been seen as the land of opportunity. U.S.-based companies have been able to ride this wave to recruit the best and brightest from around the world. Our leadership position has been particularly strong in math and the sciences: With 5 percent of the world’s population, the United States employs nearly one-third of all scientists and engineers. Half of the Ph.D.’s in the United States are foreign-born. Half of Americans who have won Nobel Prizes in physics and chemistry were born abroad. We are therefore highly reliant on immigration to produce our best and brightest. Yet there is strong evidence that we are losing our lead and that global recruiting is about to get more difficult.

Is America’s Edge Slipping?

If you want a glimpse into the possible future of global recruiting, I would suggest you read two books with somewhat similar sounding names: Flight Capital: The Alarming Exodus of America’s Best and Brightest and The Flight of the Creative Class: The New Global Competition for Talent. These books are great supplements to the equally excellent The World is Flat, by Thomas Friedman, which focuses primarily on the global outsourcing trend and how technology is leveling the playing field in the global marketplace. In the first (and most recent) book, Flight Capital, author David Heenan explores how rising economies in places like China and India are resulting in “boomerang migrations,” or expatriate workers who are returning to their home countries. It stands to reason that workers would prefer to do work in their homelands, close to their families, and within more familiar environments and cultures.

Our increasing globalization and new opportunities in their native lands make this possible. According to Heenan, “on its present course, America’s nation of immigrants will become a nation of emigrants.” In particular, the book focuses on knowledge workers in math and the sciences. If we lost our edge in math and sciences, one might reason that our advantage will always be in American ingenuity and creative thinking. But even this “creative class” is at risk, as author Richard Florida argues in The Flight of the Creative Class. Somewhat controversially, he argues that other governments like Canada, Scandinavia, and New Zealand provide less repressive environments that might be more attractive to creative thinkers — and shows how the loss of even a few creative geniuses could have a significant impact.

Immigration, Emigration, and the Skills Gap

Many of us in the recruiting industry are rightly concerned about the Baby Boomers retiring and the potential for large skills shortages. For decades, immigration has not just been a source of very specialized talent; it has been a magic bullet of sorts for any skills gaps. Without serious shifts in U.S. government strategy and policy, immigration actually has the potential to be more of a problem than a solution over the next several years. Due to security concerns following 9/11, the United States has enacted the tightest immigration laws in recent times, reducing the number of H1-B visas from almost 800,000 in 2000 to approximately 80,000 in 2005. Emigration is also a very real threat, and not just with math and science experts or creative talent. The brain drain of U.S. citizens might reach all the way up to the executive suite. According to a study by the Association of Executive Search Consultants, over 50 percent of U.S. executives surveyed would relocate to China, and approximately 35 percent would go to countries like India or Russia, all of whom would be hungry for the experience these executives have building and operating successful companies here in the United States.

The Government Responds

In the President’s most recent State of the Union address, we heard about an interesting program that lays out a new workforce plan for the United States: the American Competitiveness Initiative. The proposed initiative lays a foundation for increased spending in R&D and education plans designed to help us build rather than continue to acquire our math and science workforce. The program includes:

• Increased spending and tax credits for R&D.

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In a recent article, I made the contention that perfect candidates for your open positions might not have exactly the same background listed in your job descriptions. Furthermore, some of these best people, even if you can find them, might come across as disinterested or less effervescent during the interview then managers would like. This is a big Catch-22 — we inadvertently eliminate the best people because their skills don’t meet some invalid standards or because they won’t fake interest in a job they know little about. This is idiotic. If you want to find and hire more perfect candidates — including more passive and diverse candidates — you need to make three big structural changes. From what I can tell, unless you’re an employer of choice or have an excess of top candidates knocking on your door, these are not optional.

First: Redefine perfection. Focus on what a person needs to do to be considered perfect, rather than what the person must have in terms of skills, experience, and academic background. The technique for doing this was described in Part I of this series. Replacing the traditional job description in this approach is a list of the top six to eight critical tasks, in priority order, that the candidate taking the job is required to perform to be considered successful. This document is referred to as a performance profile.

Second: Use a consultative interviewing process rather than an inquisitorial one. Most managers use some form of behavioral interviewing or technical inquisition to assess competency. From this, they select those candidates who seem to fit the bill. Once the super short list is established, the recruiting process begins. The underlying assumption in all of this is that all candidates want the job and they’ll endure some level of disrespect to get it. “If the person doesn’t want the job, we don’t want them,” is the standard fallback retort of the na?ve manager when it’s suggested there are better ways to interview and recruit candidates. We’ll describe specific techniques in more depth in Part 3 of this article series, but here are a few ideas to consider now:

• The best people want to earn the job, rather than having it handed to them. They don’t mind competition; in fact, they prefer it. But don’t start the interview with this mindset. Save this for later.

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article and research by Charles Handler and Mark C. Healy

This revolution in the way companies recruit and hire people is moving quickly. So for the third straight year, I’ve asked users of online screening and assessment technology about their current and future use of web-based hiring systems. This year we were able to collect data from 90 hiring professionals. The data offers us an excellent snapshot of current organizational strategies, concerns, and insights around the use of technology-based screening and assessment tools.

In Part 1 of this article series on our findings, we detailed current usage rates and feelings about screening systems such as online job applications, applicant tracking systems, qualifications screening, and resume scanning. We also investigated trends in tracking the effectiveness of these tools, and how organizations could do a better job of understanding the systems they have in place.

In Part 2 of this series, we dove deeper into automated hiring processes by taking a thorough look at the current and future uses of online assessment tools. In this installment we take a higher level look at our results, drawing some conclusions and identifying trends that we feel will continue to develop in 2006. The most important findings from our recent survey:

• The use of applicant tracking systems is ubiquitous, with a very high percentage of organizations adopting or soon-to-adopt a system.

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*Note: The free global recruiting trends survey report is now available. This report was mentioned in Kevin’s previous articles.

We all have our routines and habits. For years I drove the same route to work, parked in the same spot, and ate lunch at around the same time every day. Routine is good because it keeps us from wasting time thinking about mundane and unimportant things. It is a necessary component of our lives, yet too much routine for too long can limit productivity and even end our ability to think creatively. Recruiters and hiring managers have fallen into a sourcing routine that is slowly strangling them. Most recruiters and hiring managers cluster their search for top talent around those people who are between 30 and 45 years old.

On the surface this seems like a logical practice; these are the people who have some experience, are not too expensive, and are healthy and energetic. They also are likely to be closer in age to the hiring manager and recruiter, and they probably have family, cultural, and other interests that are similar. In other words, they fit into our stereotypes of what an employee should be. Hiring managers routinely focus on experience and title as key hiring criteria. Too much and an applicant is deemed overqualified, too high a previous title and they won’t be happy. Rarely does a manager ask for someone with extensive experience for a job that he or she would regard as mid-level, or for an entry-level person who could be developed. Everyone is after this middle group of candidates. Most hiring managers and recruiters never question any of this. They assume, because it has become a routine, that this is both normal and good. They assume that someone with lots of experience won’t want or won’t be happy in a mid-level position and they assume that entry-level people will require lots of training. Because of the assumptions and strong beliefs that both recruiters and hiring managers have, recruiters are frantically tapping into all sorts of tools to get at them. The most popular tools, touted by most experts as the best way to source people, include employee referral programs, online search, competitive analysis, targeted marketing, blogging (again aimed at this candidates with a certain level of experience), carefully “tuned” websites that are written to appeal to this group, and job boards.

Many of the assumptions recruiters and managers make, however, turn out to not be all that valid. There is growing evidence from some excellent organizations that hiring people outside this stereotype not only brings in diversity and new ideas, but also costs less in the end because of lower turnover and high engagement. To compound the sourcing problem, the age group from 30 to 45 years old is also the smallest one to be in the workforce for a long time. There are only approximately 40 million of these Gen-Xers, as those in this age bracket are called, compared to 90 million Baby Boomers and 70 million Gen-Yers — those aged under 30. Despite the tools and techniques that are being used to find these people, the limited supply will always make it difficult. There is no magic bullet to get more of this group, and most programs are just recycling programs that move talent from one spot to another with little benefit to either party. Some of these practices may have significantly negative downsides, as well. Referral programs, for example, tend to supply candidates who are exactly like the ones you already have as employees. This lessens diversity of all types and increases the danger of “group-think,” which can occur when everyone is more or less similar in background, education, and experience. It is a rare referral program that introduces diversity into the workplace. What are the alternatives? Organizations like IBM, DuPont, General Electric, and many smaller ones are looking at the ends of the curve for their people. The ends are made up of three groups: new graduates, those over 50, and recent retirees. Each has unique traits that make them highly valuable.

Recent Retirees

This group can be a prime source of candidates. They are still very healthy and very much up-to-date in their fields. They may want to work fewer hours or have a more flexible schedule than less-experienced workers, but they are also not likely to be looking for promotions and are not going to get caught up in corporate politics and power plays. This frees them up to be more productive. IBM has been re-hiring retirees for many years to lead critical projects and act as technical leads on projects. Their experience makes them highly valued and heavily sought after. This is also happening at DuPont, Dow Chemical, and many other firms that have retirees and appreciate their value. These same people can be hired by other organizations that are smart and forward-thinking and can break out of the paradigms I have described above.

Over-50 Age Group

These people are most likely still working, but may be ready for a new challenge. Startup companies are finding this group of people key to success and half-a-dozen small firms I work with are actively seeking these people. They are not only relatively easy to recruit; they bring the maturity and experience that younger employees lack and add balance to teams that are very young. Their generational attitudes and loyalty are models for younger employees and add diversity of ideas. Think-tanks and innovation centers often hire them to bring a divergent view. They are relatively easy to find. After all, the workforce is over 40 percent Baby Boomers and a significant number of them are over 50 and ready for opportunities they thought were only available to young people. They are also looking for different things than Gen-Xers are. They are most likely focused on challenge and a stimulating projects than on the potential for career advancement or travel. This gives you more options when you put together an offer package.

New College Graduates

Vastly under-recruited and underused, they make up close to 35 percent of the emerging workforce and will be the most dominant group numerically within a decade. Whoever realizes this and starts to tap into them will have a competitive advantage by building a “young-person-friendly” brand. They are seeking variety, opportunity, project-based work, and organizations with less hierarchy than is traditional. They are much less expensive and learn very quickly — often with little formal training. A team of employees made up of mostly those over 50 and new graduates is powerful. By combining wisdom and experience with the latest knowledge and huge energy, these teams can be more productive than any other. The older employees act as mentors to the younger ones and the younger ones tend to keep the older ones up-to-date.

These three groups are on the fringe of most recruiters’ radar screens, but should be at the bull’s eye. The Gen-Xers are a small and tough-to-recruit bunch, while these other groups are abundant and looking for new opportunities. Instead of spending time trying to source more Gen-X folks, spend it convincing hiring managers to take a chance on some of these other groups. I believe that seniors and new graduates will be the most heavily recruited segments within the next five years. You are getting the word early enough to do something exciting in your organization.

Whether you realize it or not, we’re all in sales — that’s how we get what we need to make it through the day. We push, we pull, and we make things happen. Recruiters know this and have long ago come to the conclusion that the better we sell, the more successful we will become and the more hires we will put together. If you’re a recruiter who wants to build your organization by hiring more and better employees, you are going to have to remember the sales part of your job during the interview. (See How to Develop a Capture Strategy.)

The reason for this is because you are not just evaluating and buying talent but you are selling your company, the opportunity, and the vision of future success all at the same time. The logic for selling the company is simple: Most organizations are trying to hire the best possible employees, so when you get one in front of you, the time to make the candidate understand that this is both the position and the company they need to be hooked up with is now. Every candidate must walk out of your organization believing they just had the best interviewing experience of their entire careers. If this indeed happens, you are well on your way because if the hiring manager decides to move in the direction of an offer, you will have an easier time putting the deal together and making a great hire because there is no backpedaling required. Selling the company is a subtlety but is far easier than most people realize. If you’re enthusiastic about all of the things that make your company a great place in which to work, you are well on your way to making the sale happen. Let’s look at a few examples of how recruiters can make more hires by selling the company:

1. Provide a world-class interviewing experience. First things first: The candidate’s interviewing experience must be world class. They will never think good things about your organization if their first impression is bad. It’s not all that hard to create a great interviewing experience. All you really need is to be prepared for the candidate; be polite; be respectful of their time; be on your best behavior; and always make the candidate feel welcome. By the way, this applies to hiring managers, big time! If you don’t coach your hiring managers, I suggest that you do so. (See Make Believe They’re Coming to Your House. It was written by a genius and deals with how people skills alone can set your organization apart from others and be first choice in the candidate’s mind.)

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Everybody wants to hire the perfect candidate. And why not? These are the people who have great track records, great academic backgrounds, great personalities, great experience, and have worked at companies doing just what you want done. Even better, these great people are just like you — smart, savvy, and ready to move ahead. To make it even better (or worse), line managers from first-level supervisor to CEO can look you straight in the eye and tell you without hesitation that they can spot this perfect person in just a few minutes. So they blame the recruiting department for not finding more of them.

If the truth be told, though, anyone can spot the perfect candidate. They stand out like bright shining orbs in a desert of mediocrity. The problem, however, is they are so few in number that the cost to find them is often not worth the effort. But there is good news here — perfect candidates exist in high enough quantity to make it worth your while to seek them out. To find them, all you need to do is redefine perfection. But first, look at the following two-by-two matrix. It shows the four possible outcomes when comparing a candidate’s interviewing presentation skills to the person’s on-the-job performance.

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Want to add $10 million to the bottom line? How about $25 million? Experts say this is a rough estimate of how much a 1,000-person company loses annually from poor employee performance. The losses come from mistakes, rework, excessive head count, turnover, low motivation, poor coaching, low sales, poor quality, absenteeism, and so forth?most of which can be tracked to poor hiring practices. Executives often say that their organization “only hires the best.” After all, posters on the wall say so; but, facts show otherwise. For example, any honest hiring manager will admit that hiring decisions based on interviews are “iffy.” Why? Personal impressions gathered from interviews and applied job skills are often two different things.

Let’s look at this from another perspective. Supposed executives managed a sports franchise instead of a company. Now imagine them sitting in the owner’s box high above the field watching the team play. The players are so far away and the visibility so low that players look alike. Owners can clearly see the scoreboard after each play, but, other than that, individual player skills are obscured. At least that was what it’s like in some organizations. Subordinates “filter” critical information needed to make decisions, individual performance is often unclear, and feedback is often limited to examining reports at the end of each period. They know the results, but never really knew who or how they got there. They control money and resources, but individual employee performance is a shadow on the wall. Shadow management has some consequences: Whenever these companies institute a change in direction, employees and managers either resist or push-back; when they promote people to management, half of them fail within a year; when they reorganize employees into teams, the teams either stumbled or made bad decisions; and, the list goes on. Many years later they discover why they have so much trouble:

• Assumption: Employees can adapt to any job role we needed. Fact: employees are “pre-wired” with certain job skills; changing these skills is like changing the weather.

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Last week I began highlighting some findings from our recent survey of global recruiting trends. We found that many of you consider being able to recruit globally important, but not very many do it or do it well. It is the largest and most global organizations that have the most experience and capability in reaching out to bring candidates to the United States (or other countries) and in recruiting remotely for positions in foreign countries. But whether recruiters are trying to bring people to their home country or just to recruit for a local position, their efforts are complicated by the remoteness of candidates and the reluctance most people have in hiring people they have not met face-to-face. No technology has overcome this issue (yet), although the emerging video capabilities of some of the VoiP providers such as Skype promise to somewhat close the gap.

Language

Another concern is what language to use in a recruiting website and for interviewing. If you represent an American company, is knowledge of English essential for all jobs? Can your applicant tracking system be provided in multiple languages? Should it be? While English has become the lingua franca for professionals around the world, it is not considered essential for hourly positions or for many positions that do not involve direct conversation or interface with those from other countries. Even so, very few organizations are offering or considering translating their current website or applicant tracking system into another language. It seems that there is a general, although unspoken, agreement that English is the language one needs to know to work with or for international firms. English may also serve as a screening tool for some organizations where English is required. As one respondent said, “I am in health care and [employees] need to be able to read and speak English [to] understand physician orders.”

A website and applicant tracking system in English are effective ways to test skill. Beyond language are other and often much subtler areas of difference. Some countries have very different methods of obtaining applicant data; some ask for material that is considered inappropriate or illegal in the United States (e.g. sex, age, and marital status), and many use more extensive testing and screening than is common in the United States. Even the way things are worded and how jobs are described have local twists that are frequently overlooked on global websites. We did not probe into this in our survey, but we may begin some analysis of global websites later this year. Only 32 percent of respondents have applicant tracking systems that are universal for both U.S. and global locations, while 34 percent have a system implemented in the states only.

The overwhelming majority of respondents reported that there entire recruiting site is in English. Besides English, the most popular languages for an organization’s recruiting website, applicant tracking system, or both include: Chinese (16 percent), German (16 percent), Spanish (14 percent), French (14 percent), and Japanese (13 percent). Most respondents (55 percent) are not planning to change their websites or move to other languages. For respondents whose recruiting website is currently in English only, 15 percent said that 2006 will see their site available in another language. Even fewer are planning to move their applicant tracking system to another language. Only 9 percent said that 2006 will see their site available in another language. The two biggest obstacles that respondents reported to implementing a global website or applicant tracking system include the lack of the perceived benefit or need (30 percent website, 29 percent applicant tracking system) and the cost (24 percent, 26 percent).

Screening

Recruiters are truly locked into an interview paradigm. Perhaps over time we will begin to see more value in testing and in other forms of screening and assessment, but for now the interview rules globally. While interviews do provide the human contact and social experience we all need, they are expensive and time consuming to conduct and have a varying degree of validity, depending on who does them and how they’re done. Even skilled interviewers using the best methods cannot predict performance as well as tools such as skills and cognitive ability testing. The top three most commonly used screening tools globally are one-on-one interviews (81 percent); reference checking (70 percent); and educational background checking (56 percent). Skills testing is also done in many cases (34 percent), and almost 25 percent of respondents use an assessment center. A handful of firms reported using IQ and personality testing and a few even use handwriting analysis (3.4 percent). Many use a combination of tools; this increases predictability and is a recommended practice. As one respondent says, sourcing and screening globally often is an informal process. “Access to quality candidates is an issue as I recruit from the corporate head office in Sydney, Australia, and need to hire quality candidates to our regional locations, including UK, Singapore, and the U.S. We tend to rely heavily on word of mouth and referrals, which can lead to nepotism.”

Metrics

Measuring success of global recruiting requires the capability to collect and analyze data, usually by using an applicant tracking system. A majority (55 percent) of respondents tracks global recruiting metrics through the central corporate location, while 38 percent track international recruiting metrics locally. Barriers to effectively tracking metrics for global efforts are similar to the barriers for global efforts. One respondent said that her barriers included “reconciling the need for global standardization (and resulting metrics/efficiencies) with local customization to accommodate cultural and legal differences.” Global recruiting is a growing business, and for many organizations the distinction between local, regional, and global recruiting are blurring. Talent is increasingly global and our success in seeking out the best, screening for the best, and hiring them depends on being able to put together strategic talent plans, build or buy tools and services that can be used globally, and on developing a standard set of metrics to track success. We still have a way to go. The final complete report, available free to ERE readers, will be ready next week. We are putting the final touches on it and will have a link to the report in next week’s column on ERE. My thanks to everyone who responded.

Small- and medium-size enterprises have both differences and similarities to the operations of large companies. Although small- and medium-size enterprises do not manage their operations on the same scale as big companies, they share all of the same basic structures and business processes. The organization charts for all companies include departments for sales and marketing, administration, production, accounting and finance, human resources, and more. Large companies, however, have historically held the advantage in hiring. Their size provided larger budgets to afford big recruiting advertisements. Large organizations had the advantage of dedicated and substantial resources for their corporate websites, which included careers sections. They also allocated IT funding for acquisition and implementation of sophisticated back-end hiring management systems.

Times have changed. The good news for small- and medium-size enterprises today is the opportunity to gain the same advantages from many of the business process and technology improvements that were designed for large companies, and until recently, have only been available to large companies. With the combination of on demand availability, best practice processes, software-as-a service technology, and Internet connectivity, all companies are now only one click away from the same capabilities. In the area of human resources, small- and medium-size enterprises now can leverage technology and process improvements that can transform their talent management operations to be more effective and efficient. Two areas with low-hanging fruit for small- and medium-size enterprises are sourcing strategies and hiring management systems. The playing field is leveling.

Sourcing Strategies

The evolution from expensive newspaper recruitment advertising to online job boards represented a major shift in reach for candidate sourcing. For small- and medium-size enterprises, job board advertising rates were often too steep — and the geographic reach was broader than they needed. Hiring for small- and medium-size enterprises requires identifying external candidates, yet may not involve high-volume recruiting. Staffing is typically geographically limited. Sourcing strategies are often reactive: The need for a new hire occurs and advertising for that job opening is placed. Once the hire is made, sourcing for candidates halts. That method of candidate sourcing is expensive and misses out on the low-cost/high-yield opportunities presented on the Internet today.

Your Message Must Be True

To drive recruiting success in the future, small- and medium-size enterprises need to develop a good message and employment brand, and be poised to react to quality candidates quickly. The employee value proposition must ring true and be communicated in all media, including the corporate website and recruitment advertising. Low cost, local resources can help transmit the message and build a candidate pool. One example is using Craigslist, an online community with a wide range of classifieds and forums. Craigslist has sites covering 190 U.S. cities as well as 35 country sites. Job postings are easy and free at all sites except the San Francisco, Los Angeles, and New York City sites. Rates for job postings at those sites are substantially less than major job boards. Craigslist was the number-one classified site according to comScore Media Metrix, with 8,236,000 unique visitors during October 2005. Also, watch for opportunities for job posting and candidate sourcing with Google Base, a massive classifieds database combining listings aggregated from other sites, along with postings which are currently free. DirectEmployers Association, a consortium of U.S. companies, has announced a partnership with Google. All member company jobs currently available through the DirectEmployers search engine and those located at JobCentral.com will be included in a new Google database. In addition, new online referral networks such as LinkedIn, Jobster and H3 provide opportunities for any web-savvy recruiter to engage in a “six degrees of separation” exercise and access a much larger network than a small or medium-size organization’s own employee referral program could deliver.

Software as a Service

A strong sourcing strategy produces numerous candidate applications and information, and requires filtering and assessing candidates to make the right hire. Up until now, managing the hiring process has created an administrative burden for small- and medium-size enterprises. Today, small- and medium-size enterprises can improve business performance by streamlining hiring processes with self-service talent management applications delivered on demand, known as “software as a service.” This software solution is designed specifically for web delivery and supported by a vendor as a service, only requires a standard browser and an Internet connection. It is subscription-based and easy to configure and deploy. This can be the platform for:

• Requisition management

keep reading…

article by Dr. John Sullivan and Master Burnett

As one of the most — if not the most — vocal proponents of employee referral programs, we are constantly monitoring what’s going on in leading organizations, what characteristics drive program success, what barriers limit excellence, and what various programs are achieving. Our vantage point is a privileged one, one we didn’t fully understand until we started to look into what benchmarking research actually existed on the topic. Short of whether or not an organization has a program that offers cash incentives and the value of those incentives, very little research exists.

Lots of Questions

While we have written on this topic extensively, sharing what best practices have been observed, documenting what concepts from other functions can be borrowed to drive a program, and highlighting the firms that for lack of a better phrase kick butt, we are aware that program managers have questions. In 2005 alone, concerned recruiting professionals submitted more than 179 questions to us via email or through our website. Questions ranged from how to go about countering objections that employee referrals are unethical to figuring out which program marketing approaches were most effective. Not a single question was one that other organizations could not benefit from knowing the answer.

The Role of Benchmarking

Benchmarking can be time consuming, costly, and in the end tell you nothing more than what the average firm is up to, but it can be much more. Most of the organizations that “get it” — it being the “new DNA of HR” — look at benchmarking as a tool to force an audit of their own practices. Incidentally, they approach external awards and competitions from the same perspective. Such efforts force practitioners to ask questions and to analyze their efforts a different way. They also provide a comparison point in that most benchmarking programs not only look at results, but also what characteristics drive results. While most report averages, almost all document the outlying data as well; this, without a doubt, is the most valuable information. If your organization isn’t benchmarking, then you are not leveraging a key tool in becoming world-class.

What To Focus On

The questions received made it clear that there isn’t any one focus area that employee referral program managers are struggling with; it seems that nearly everything under the sun can be a valid issue. That said, in preparing to help fill the void for lack of information on this topic, we did sort out the questions into six logical categories including:

• Creating a program strategy and business case

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There is a conspiracy preventing companies from hiring top people. The bureaucrats are behind it. We’ve been fighting the war for talent for a long time and nobody has won. Odd. Despite all the talk about “Hiring is #1″ and the desire to win the war for talent, from what I can see it’s just lip service. The bureaucrats are the enemy, and they have won. If you want to hire top people and win the talent war, the bureaucrats must be defeated at all costs. To start, a face needs to be put on the enemy. Look in the mirror first. It could be you. If not… Here is my top 10 list of the bureaucrats and bureaucratic things preventing companies from hiring top people:

1. Most lawyers. Lawyers aren’t too creative. If they’re honest, they try to keep their clients out of trouble by telling them how to best follow the rules. If they’re not so honest, they do things to increase their billings. If they’re very good, they understand their clients’ business objectives and make sure that they don’t just follow the rules without considering every possible alternative. Some lawyers are crooks, too ó but that’s not what we’re discussing here.

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In the face of growing worldwide skills shortages, organizations will increasingly attempt to activate their employee base as the main engine of their recruiting efforts. This will eventually blur the line between where the recruiting department ends and employee referral programs begin. Furthermore, our traditional notion of what makes a great employee referral program is poised to change dramatically.

Recruiting in the Year 2015

Imagine the year is 2015. The first wave of 78 million baby boomers started turning 65 four years ago. Headlines and lead news stories reference skills shortages in IT, engineering, nursing, and consulting, among other fields. Help-wanted signs begin to pop up everywhere. Productivity growth slows and potentially declines as valuable intellectual capital and productive workers are lost to retirement. The U.S. economy has shifted even further into a knowledge-driven economy — less capital- and more human-intensive than ever before — expanding the competitive set for talent in many industries. In past skills shortages, America has been able to turn to immigration to solve our challenges. This time is different. The United States is no longer seen as the land of opportunity, having been recently supplanted by countries like China and India. As suggested in the new, must-read book, Flight Capital: The Alarming Exodus of America’s Best and Brightest, tight immigration laws designed to fight terrorism and rising economies in places like China and India restrict our ability to import highly skilled workers away from their homelands. Many companies will turn to employee referrals to fill the void. This will not just be based on the fact that referred employees stay longer and perform better once hired, but based on desperation to find someone ó anyone ? who can do the job.

“We’re All Recruiters”

As Cisco demonstrated in the tight IT labor market in the late 1990s, it’s possible to turn your entire company into a recruiting force for you that generates up to 50 to 60 percent of new hires, increases productivity, and lowers time to fill. With larger volumes of active candidates and the ubiquity of the Internet driving large volumes of resumes, the Cisco Friends approach (where candidates could connect with a Cisco employee in their field instead of applying) would be a difficult strategy to undertake today without a tight screening process in place. Yet considering the time, when Internet usage was not as prevalent as it is now, labor markets were tighter, and Cisco was still establishing a name for itself, the Friends program was nothing short of brilliant. Cisco employees acted as an extended sales force, helping convince on-the-fence and passive candidates that the company was a viable (and friendly) employer. John Chambers, its CEO, measured referrals as a key performance indicator and kept employees on track with the program when numbers slipped. And the mountain of press generated about the innovative program helped turn it into a magnet employer. Today, most employees see recruiting as the job of one department. In the future, this will need to be seen as a company-wide initiative. Every employee will need to know that they are responsible for recruiting great people into the company, and how their activities will benefit them and the organization.

The New Employee Referral Program

What will it take to boost employee referral hires to 50 to 60 percent in 2015? How will employees be engaged in your recruiting efforts to help you get an edge over the competition? Here are five key employee referral initiatives that will help you achieve employee referral success in 2015 and beyond:

1. Extend employee referral programs to passive job seekers. Your target hires in 2015 will be even more likely to be employed than they are today. In the future, employees will be encouraged to drive leads and prospects vs. resumes and applicants, and recruiting processes will be better prepared to support this. They will also be your best networkers, opening up their rolodexes or actively building relationships that will lead you to great talent. Extended or multi-level referral programs that reward indirect referrals (for instance, a friend of a friend of a hire) will become very common.

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The idea of a global workforce is just emerging. Most of us still believe and practice the maxim that “all recruiting is local.” For some firms, even recruiting outside their state or county is a rare occurrence, while some of the world’s largest companies have recruited internationally for decades. Over the next decade, most organizations will face the need to look for people beyond their local environments. This is partially because people locally may lack the needed skills or experience, but also just because they can. It is very enticing to hiring managers to think that they can tap into the world’s best talent — no matter where it lives. With the tools we have today — the Internet, referral technologies, email, and so forth, seeking out talent in other places is easier and faster than ever. The Internet has changed most of what we do and it has allowed work to move anywhere. Just a few years ago, the thought of having someone in another country design our products, talk to our customers, provide technical help, read X-rays, or diagnose a disease was unthinkable. Today it is happening regularly. This also means that recruiters usually find themselves facing one of two global recruiting situations:

1. Recruiting remotely from the home country to find people anywhere and recruit them to the parent organization.

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The candidate interview is a unique experience ó that strange dance between two strangers sitting across from another, one asking the other about their life and accomplishments, with an eye towards assessing if they are a fit for a particular role. I guess one of the great things about human nature is our unpredictability. You don’t know what’s going to come out of the other person’s mouth or how the experience will end up. How many of us have gone in with high expectations of an individual based on their experience on paper, only to be let down?

Conversely, who of us hasn’t had that rush of excitement when a candidate unexpectedly turns out to be a winner, surprising us at every turn with their responses, and reaffirming our belief in what we do as recruiters and staffing professionals? Regardless, it’s a setup that’s bound to produce interesting outcomes. I’m not an interviewing guru. I don’t sell my interviewing process in training sessions, books, or other products. The purpose of this is not to produce a best practices approach to interviewing. Rather, as someone who has done a lot of interviews (as a former corporate head of staffing and recruiting, and currently as a staffing and recruitment process optimization consultant), I’m in a position to share the following stories. Maybe you’ll laugh, maybe you’ll cry, maybe you’ll snicker, but maybe, like me, you’ll learn something as well. So consider this our inaugural “Strange but True Interviewing Stories” article. After you’ve read these, send me (jeremy@rivieraadvisors.com) your stories, as well as what you learned from them, so we can begin our collection for future articles.

“The Restaurant”

During my time in staffing for a consumer company, we had a search for a head of marketing. There was a woman who ran marketing for an entire restaurant chain whom my bosses (clients), the operational heads of the company, were particularly keen to recruit. This executive had attracted a lot of buzz because of her recent accomplishments and bold marketing initiatives. After several attempts to contact her, the woman finally agreed to meet with me but would not travel to our city to interview. Knowing how important this was to my internal clients, I flew to her city and interviewed her in one of her local restaurants. The interview seemed to go well and I remember thinking, “My bosses were right. She is solid.” We talked about next steps and I mentioned we would want her fly to our company to meet with my bosses/clients. That’s when the conversation took an interesting turn: “So we’d like to fly you out to meet with some additional executives in our company,” I said. “We’re very interested in proceeding.” “I’d be interested in that,” she replied. “Great!” “I’d be happy to meet with you and your company further,” she continued, “but it would have to only be in one of the local outlets of this restaurant chain.” “Excuse me?” “I said I can only meet you in one of our restaurants in your city.” “Why?” “Because the world is a dirty place,” she said. “There are germs everywhere and I don’t trust cleanliness, food, or service anywhere but in one of our restaurants.” “You can’t be serious,” I said. “I’m completely serious,” she replied. The problem was my bosses had already pre-judged her favorably and were sold on her!

Learning:

When I returned from my trip, I had to take a pretty hard stand with my business leaders. They had convinced themselves that they needed to hire this person before we even called her. Now I had to convince them (even though it was my job to snag her), that she was not going to be a culture fit. It was a tense situation but I stood my ground. Ultimately, they agreed. What I learned was that as a staffing professional and recruiter, taking a stand to protect our company’s business by not hiring someone is as important as trying to snag an elite person.

“The Hotel”

I once worked for a hotel company where we offered candidates the ability to fill out applications that had a short essay about why they wanted to work for the hotel. We had created an open, walk-in interview schedule whereby anyone could submit an application and we would interview anyone who had applied. A guy came in and filled out the application and was very earnest in his desire to work for the company. My colleague interviewed him and he seemed like a congenial, straightforward individual. It was a busy day for us all and we didn’t have time to thoroughly review every application before beginning the interview. During the interview, my colleague turned over the application to the back section, which included the short essay about why they were interested in working for the company. He read the following:

I have spent the last several years as a male escort/prostitute. I have recently turned my life around and “found God.” I am looking for a “real” job, something more stable and with a healthy future. When I was considering all the companies I might want to work for, I immediately thought of this hotel. I have done a substantial amount of business here — for which I hope you will accept my sincerest apologies — and always found it to be an incredibly nice place. It would be an honor to work here.

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While the benefits of implementing a well-designed employee referral program are practically endless, it is fairly common for even the best programs to become stale after some period of time. Best-practice firms routinely garner at least 40 percent of new hires via their employee referral programs, and they use this measure, combined with employee participation rates, as a barometer of program health. If you have never achieved such performance, or have seen this metric decline, chances are your program needs an infusion of innovation. Luckily, employee referral programs are dynamic — many things can be done to upgrade or reenergize your program. The average organization will generally begin to experience program performance declines within six months of the program’s initial launch. If not addressed, these declines can spiral into serious problems within one year.

Action Steps for Reenergizing Your Referral Program

1. Reinforce the employee’s role in building the team. Great referral programs are not about money; they’re about empowering employees to play an active role in building an all-star team for them to work with. Exceptional employees understand that working with the very best people helps them learn, reduces the time required to clean up other people’s sloppy work, and ultimately leads to a better chance at success. The major action to take is to change the perception of who benefits from the referral program. All promotional materials and communications must be redesigned to emphasize this program is “all about them.” The subliminal message is that if they don’t help by becoming 24/7 talent scouts, they might just end up working alongside a lot of pretty average people!

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In recent articles, I made the case that fundamental shifts in decision-making and perspective had to take place in order for a company to see any sustained improvement in its hiring results. Furthermore, it’s my contention that unless these changes are made, a company’s ability to consistently hire top people will not improve — regardless of what new tools or techniques it implements. To validate this, consider how well your own company has done in improving its ability to consistently hire top people over the past few years. With so much competition for top talent, unless your company is an employer of choice, it’s probably just as hard to hire top people now as it was a few years back. And this is despite all of the training and all of the investment in new tools and technology. The shifts I’m suggesting will allow all companies to compete for top talent even if they are not employers of choice.

Push Candidates to the Top

The first of these shifts has to do with rearranging the underlying hierarchical relationship that now exists among the recruiter, candidate, and hiring team. In most companies, the hiring team sits at the top, with recruiters a rung below and candidates at the bottom. Pushing candidates to the top and making recruiters partners is the first change needed if a company wants to hire more top people. The second shift requires the implementation of an evidence-based hiring decision-making process, replacing one based largely on emotions, biases, intuition or a too-narrow range of technical skills and competencies. Too many good people get excluded for the wrong reasons when evidence is not used to justify the selection. Too many average people with great interviewing skills get hired when feelings, prejudices, and intuition override judgment. Making these changes throughout an organization requires executive-level involvement. In most companies, this won’t happen.

But there are things that the individual recruiter can do to begin the process immediately. As a result, the recruiter will become more productive, become more satisfied with the job, and help his or her clients to hire better people. The key is to know how to defend your candidates from bad decision-making. It starts by becoming a partner with your hiring manager clients. Becoming a partner is the first step in rearranging the natural hierarchy. In most companies, the hiring manager and the hiring team believe they have the wisdom, insight, and judgment to accurately assess candidate competency and recruit top people.

As a result, most put their recruiters in a subordinate position. Rarely is the recruiter a true and respected member of a cross-functional team. His or her advice is not sought, time is not freely given, and the recruiter’s assessment of candidate competency is assigned little value. Even worse, for a variety of reasons, recruiters and managers — aggravated by company policy, the comp group, and common practice — put candidates in a role subordinate to both recruiters and managers. The observable result is a lack of respect throughout the process — until the person becomes a finalist. This is evidenced by jobs that are hard to find, an application process that requires too much upfront commitment, demeaning job descriptions written to exclude the worst, not attract the best, and a “don’t call us” mentality at all but the final stage. To counteract this, a market-driven “candidate as customer” mentality should be applied to every process and practice involved in hiring. How top people look and decide should drive this re-engineering process, not how less qualified or overly zealous applicants look for work. By becoming partners with their hiring-manager clients, recruiters can use their influence to better defend their candidates from dumb decisions and poorly designed practices and policies. The key to the defense requires intervening at each step of the assessment and selection process, fighting soft emotions with hard evidence. Here are some things you can do to get started:

1. Know the job. Before you start looking for candidates, ask the hiring manager what the person needs to do to be considered successful. Have the manager define the key projects and challenges the person is expected to handle. Then ask the manager to describe how better people handle these same tasks compared to average people. I call these types of documents performance profiles. Prepare a preliminary performance profile ahead of time by talking to the best people you’ve placed in similar positions and find out what they did differently than the average performer. This way, you can ask the hiring manager to modify your preliminary performance profile rather than starting from scratch. Doing most of the work to prepare a performance profile ahead of time demonstrates solid job knowledge and will earn you some partnership potential points.

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If you want a successful onboarding process, one that quickly engages new employees and helps them succeed — rather than leaving them with “new hire’s remorse” — there’s a mantra you must remember. More importantly, you need everyone on your management team to remember this mantra. It comes from a lesson that branding guru Scott Bedbury learned at Starbucks.

After joining the java juggernaut, he went on a coffee-hunting expedition with Dave Olsen, Starkbucks’ chief coffee buyer. Bedbury, author of A New Brand World: Eight Principles for Achieving Brand Leadership in the 21st Century, probed Olsen for the secret to Starbucks’ branding success. What was, to use anthropologist and philosopher Gregory Bateson’s famous term, the critical “difference that makes a difference”? What mattered the most to the company’s branding success? Was it all about the coffee beans; were they that different? Was it the ambience Starbucks has so assiduously created? Was it the employees they’ve hired? What particular part of their winning combination mattered most? After pondering Bedbury’s question and weighing the variables, Mr. Olsen responded: “Everything matters.” All world-class brand managers know that everything matters. They know that every communication and every interaction with the customer matters. Every decision and every choice matters, because they will either strengthen or weaken a brand. This same principle holds true when it comes to organizational and managerial practices and how they affect employee morale, engagement, and pride. Every decision, every moment of truth in which an employee bumps up against organizational policies, procedures, and processes matters.

Noticing Minor Flaws

The principle “everything matters” is especially true in the first 60 to 90 days of an employee’s tenure with your company, because employees are the most impressionable during this period. When people are in unfamiliar territory, they are more alert for any clues that will help them navigate the terrain. In this state of uncertainty, they are also more likely to leap to conclusions when forming perceptions and opinions. This is because when we feel vulnerable and uncertain, we’re more prone to remove any uncertainty possible. To use a term from cognitive psychology, they are vulnerable to making “premature cognitive commitments.” When we make a premature cognitive commitment, we leap to a conclusion before having enough data to make a truly informed choice. Because new hires are more vigilant for clues, they’re likely to notice even the most minor examples of a poorly designed and executed orientation program and onboarding process. Because they are prone to premature cognitive commitments, they are more likely to see these as indicative of a poorly run organization that doesn’t care about employees. Thus, when it comes to onboarding, everything matters.

Everything You Do Sends a Message About Your Company

Every choice, every action, every communication has potential consequences. Every choice has a consequence in terms of how quickly an employee gets up to speed. Every choice communicates to the employee something about your organization. For instance, poorly organized, “fly by the seat of your pants” orientations communicate something very different about an organization than does a well-organized, professionally delivered program. Recognizing the importance of having new-hire orientation reflect and support the company’s culture of excellence, Eric Wood, president of EnviroSense, requested that his HR team conduct an “orientation makeover.” Because every action carries an implicit message, their new orientation program communicates to employees a message consistent with the company’s culture, mission, and values. “In our business,” says Wood, “high levels of performance and attention to detail are critical and expected of every employee. In order to ask for this level of performance, we want to make sure we show our employees the same commitment.”

Showing You Care Is One of the Strongest Drivers of Employee Engagement

The level of support provided to employees after leaving orientation also communicates an important message. Using a “sink or swim” approach to onboarding communicates a loud “we don’t care about or value you” message, while an onboarding process that provides new hires with a mentor and periodic check-ins sends employees the kind of message that leads to engagement and loyalty. At Community Living Association, a Maine non-profit organization that provides services to individuals with developmental disabilities, employees frequently complained about how awkward it was going into a new home when they were both new to the job and a stranger to their future client. To remedy this, new employees no longer have to “cold call” their new client. Instead, a staff member who already knows the clients makes the introduction. By demonstrating their concern for their new employees’ comfort, management obviously communicates a far different message than if the company had adopted a “that’s just how it is…deal with it” stance.

Is Your Orientation Program All Rules and Red Tape?

Another significant moment of truth that matters greatly is whether your orientation focuses on rules and regulations and neglects the inspirational component of being a new employee. Making orientation primarily about rules and regulations communicates something very different about an organization than an orientation that communicates these messages:

• “We’re happy you’re here.”

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Saying to myself “duh,” I read Monday’s Wall Street Journal’s article on employee pay with amusement. The article outlines how some companies are actually paying their best performers significantly more than other employees in an effort to retain them. How silly we have become as a nation. In the pursuit of “fairness,” we have somehow lost our ability to measure performance or to be willing to let people know how they are performing. Rather, we have chosen to give everyone a similar pay raise — perhaps only a 1 to 3 percent difference between a top performer and a real laggard — not much to inspire the best and not much to motivate the worst. This practice is common in small and large businesses and extends all the way to the top. Many compensation schemes give executives large bonuses when the company performs well — but not when they themselves do. All this is finally becoming an issue. CEOs, whose average annual compensation in 2004 was around $9.8 million, are being challenged to justify that compensation to shareholders at annual meetings. Regular employees, who lack the status and clout of executives, are choosing to move on.

I agree that salary is not the main determinant of turnover. Throwing money at people to keep them never works for long. And I’m not talking about how much money, per se. What I am talking about is creating an atmosphere where performance is respected and where excellence is not just a buzzword. I would find a system that gave everyone huge raises as bad as one that gave them all small ones. It is not the amount of raise; it is the differential that a firm places on performance. By making pay ranges small, organizations create an atmosphere of disrespect and perpetuate a culture of mediocrity. When there are no clear benefits of performing exceptionally well, many people find they are less motivated, less challenged, and much more likely to leave for some other opportunity. Take the case of a person I know who was working for a large, national organization with offices and physical locations in most U.S. cities. This person started at the firm with a charter to develop a world-class recruiting function. He had top-level support and had been sought after because of his previous accomplishments. He was challenged to bring disparate parts of the organization together, create common goals, improve candidate awareness of the organization, raise candidate quality, and lower costs.

Over a three-year period, he and his team met all of these goals. They received recognition both internally and externally. But each year, he received only a small raise, a few shares of stock, and a pat on the back. He soon learned that almost all his peers had received similar raises — even peers who had not met their goals or who were openly acknowledged as not performing at a high level. Stock was given by title and seniority, not performance. Salary raises were more or less determined by length of service, as well, with only a tiny percentage allotted for performance. At the end of the third year, after many conversations with his boss and even higher-up bosses about this situation, he opted to leave for a smaller organization where pay was based on achieving goals. Recruiters need to understand that how candidates perceive the reward system has an impact on recruiters’ ability to recruit and on the firms’ ability to keep good people. Here are a few specific things recruiters should lobby for internally and use as a yardstick of corporate integrity. (Interestingly, integrity was the most frequently looked up word in Merriam-Webster’s online dictionary last year. As a nation, we are more and more concerned about ethics and integrity. Candidates and employees are asking what the organization stands for and what values will win out in the event of a crisis. Too often employees are discovering that they are not valued as much as they might hope, and choose to move on.) Every organization should have:

1. A clear statement of how employee performance is measured. Does your organization provide guidelines to employees about how they will be assessed? Does your organization have a goal-based compensation scheme? Who decides how an employee performed? These need to be spelled out early in the hiring process. The best measures of performance are quantitative and reflect the work of the employee (or the employee’s entire project team) rather than the collective effort of a department.

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