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Do We Need Internal Recruiting at All?

by
Kevin Wheeler
Jan 26, 2011, 5:08 am ET

As the years have rolled by I have become increasingly aware of how poorly internal recruiting functions perform when compared to recruitment process outsourcing organizations or agencies. These have to make a profit or go out of business. They have to operate efficiently and continue to innovate and stay ahead of the demands or questions that clients will have.

Internal functions don’t have to do any of these things. They are entrenched in almost all organizations, and because their function is perceived as incidental to overall organizational performance or success, not much in the way of efficiency is really expected or, unfortunately, rewarded. This means that few recruiting leaders have any incentive to improve their function. In fact, doing so may mean a smaller budget, less headcount, and even less status.

So this leads to the headline question: Do we need an internal function at all? Does it do something that an external provider cannot do? Can it do it at least as cheap or as fast? Can it provide a higher-caliber candidate?

Some thoughts:

  1. Internal recruiters who are employees should have one major advantage over any external provider. That is a deep knowledge of the corporate culture and what success criteria are, and also what individual managers are looking for in candidates. The deeper and more scientific this knowledge is, the more it can be repeated, refined, and taught to others. A really outstanding internal function would nurture and develop a core of highly knowledgeable and trained recruiters who would have this knowledge. HP, in the old days, and IBM today, have this kind of built-in DNA that is very hard to replicate. External functions will always have difficulty achieving this level of intimacy with their clients, even when co-located, primarily because their employees have less motivation to invest in gathering this information and may be interchanged frequently. This is one area where length of service and commitment to the culture can pay dividends.
  2. To remain competitive with outside providers, an internal function has to be as efficient as or more efficient than an outside provider. This means constantly improving operational excellence, adding appropriate technology, providing detailed market information and coaching to hiring managers, and building a reputation for adding real value through the quality of talent it provides. I have never seen this in any client or organization I have worked in, and I think this is the area of greatest potential return. Internal functions are never very efficient, primarily because leadership is transitory: I am not sure of the average tenure of a recruiting leader, but I would guess it is less than three years. This means there is little to no continuity of planning, no oversight of process improvements, and little opportunity to choose, install, learn and refine technology. Most organizations I have worked with change processes, procedures, and technology with each leader who arrives. Plans that have taken months to create are thrown away overnight. Recruiters know that they can do what they want, for the most part, because there will be no accountability or continuity. This is the area where an external provider, with a profit motive and an efficiency goal, can beat an internal function hands down.
  3. Recruiters also need to be retained, trained, and incentivized to perform. External agencies can offer commissions, bonuses, and other rewards for outstanding performance. They can fire inefficient or incapable recruiters quickly. Internal functions are usually tied to traditional reward structures that do not provide the shorter term, efficiency-based rewards that would be more effective. A recruiter can barely perform at all and survive (and even thrive) by courting a few hiring managers or by being a good bureaucrat. And employment laws and internal practices limit when and how a recruiter can be fired, and the process is lengthy. Again, it is essential that internal recruiters be selected carefully based in skills and motivation and offered whatever incentives are available to encourage short and long term performance as well as retention.
  4. The emerging prominence of social media should offer internal functions hope. Social media inherently dependent on intimate knowledge about the firm, candid communication, and the ability to take advantage of the networks of current employees. All of these give internal functions an edge.

Yet I am not convinced that this will make much difference. The RPOs and agencies are rapidly adopting social media and are even offering to manage the talent communities of individual firms. Many medium or small firms are not even looking at social media as a recruiting channel, and larger firms have widely divergent opinions and practices.

Effective social media use requires time and dedicated people who can interact with candidates, generate content, provide advice, and screen candidates for individual jobs. These are all strengths that internal recruiters have if they are given the time and charter to do so. Unfortunately again, corporate policy, management’s inability to see the benefits of social media, the fear of litigation, and lack of staff depth usually means this does not happen.

Given the state of recruiting functions today there are few compelling factors to recommend retaining an internal function. I have outlined where they could gain advantage, and a handful are doing these things, but by and large they offer little that would make them indispensible. By negotiating tough performance-based outsourcing agreements and allowing outside recruiters access to hiring managers, firms could eliminate the administrative and benefits costs of retaining employee-recruiters and the function could be reduced to a few liaison folks and vendor managers.

This article is provided for informational purposes only and is not intended to offer specific legal advice. You should consult your legal counsel regarding any threatened or pending litigation.

  1. Ginger Graham

    I’m not sure if I should be offended as the head of an internal Talent Acquisition team, or if I should be proud that we do not relate to your article at all.

    I have spent the last few years leveraging my blood, sweat, and tears to prove ROI of an internal recruitment function for our global company. The idea that we would be ‘just fine’ if we did not deliver quality, efficiency, and innovation is way off of the mark. Our leadership questioned all departments as we moved through a very stressful economic time and if you do not believe that is motivating, I invite you to sit in my chair.

    I would also state that an internal function has more than cultural knowledge of our environment, it has influence. In order to drive a company to the leading edge to become competitive, you must know how to move the roadblocks of executive leadership and budget holders. We have this intimate knowledge that cannot be bought.

    I also struggle with the idea that outsourcing an area equals efficiency. Just the proximity to the decision makers leads to quicker, streamlined results. For example, we outsource our relocation function, however, there is nothing efficient about this process. I am still being hounded on an hourly basis to answer questions and manage internal approvals and documentation and on occasion attend a ‘quarterly review’. This is so inefficient, that we’ve had to hire someone to assist in administrating the impact internally.

    I would also argue that Social Media is not the beginning of the end of the internal function. This is yet another tool in the box of our recruiters that we find can be quicker and easier to communicate with potential slates than cold calling into a competitor. By partnering with our Marketing department, we are able to build both employment and consumer brand simultaneously. (something we may not be able to do with outsourced assistance)

    Finally, our recruiters are not bonused or have giant dangling golden carrots in front of them in order to drive the hunter. Maybe I’m unique, but my team of recruiters are proud, and self-driven by the camaraderie that makes the workplace fun and inspiring. Our motivation comes from career development and roundtable strategy building. They are a part of the solution and the feedback I’ve received is that they are proud of our successes.

    I will give you this, I’ve only been in this seat for three years :)

  2. Sarang Brahme

    I think I’ve read a similar post sometime back saying – do we need recruitment agencies? I guess – both these posts are very extreme and written with intent of generating blowing discussions. It is somewhat disappointing coming this from someone like Kevin.

    Everyone here in recruitment – either in agency OR in-house has our own part to play. It is OR should never been Agency VS In-House recruiter. I’ve worked in offshore RPO (OS2i) for over 5 years and now currently in domestic sourcing for Big5 IT consultancy for 1.5 years. Been both side of the fence.

    Firstly – an internal recruitment function is always an inbuilt functionality and a much needed body part for any company. Do you really want to depend upon outsiders to bring in the talent which will build your company? Companies have much better control over internal function than outsider.

    It is a sad statement that there are no companies which have achieved an internal excellence about recruitment. There are and will be internal functions who have achieved that level. I know for the fact that some companies – including mine has achieved more than 90% direct hires. We used to be vendor driven but building our own internal recruitment / sourcing function has saved us a lot. It is extremely difficult to build such function by external element. I will not say there aren’t any such companies – there will be few. No extremes.

    Just because external companies will work towards profits and their recruiters will see incentives – does not give any surety about results. Is this taken for granted that recruiters only work for money? What about passion, drive in achieving excellence, transformation, career development? Interestingly – recruiters and third party will be motivated to earn their own bucks; again – external body part…. isn’t’ it?

    Most of my candidates ask before starting conversation that are you from agency OR company? They feel more trusted, secure and faithful with company recruiters. Why? Because they have a direct connect to hiring process and people. It is beyond my imagination as to how an external agency will drive internal function much better – as they do not have access to internal strategies, company fabric, culture, people and processes? Same goes with Social Media. This is a great channel for companies to engage people with their own values, brand, ethics, products and processes – would people feel same about agency running this? SM has provided a greater weapon to agencies today.

    In today’s world – everyone has their own right places in market. We still require vendors for hard-to-find roles, headhunting OR any specialty requirements. They have their own place but do not mean that they will overtake internal function. It’s a very extreme statement. Also – rather than internal VS external; we should be thinking about internal + external. We need both – right time, right place.

    I believe this post will certainly provide someone an initiative to write about do we really need agencies/RPOs? Let’s not devalue each other. Let’s respect each others strengths, weaknesses and shortcomings. We all should be working together to stand together as one unit – helping each others to find ways….

    Sarang

  3. Martin Snyder

    The answer is: Yes.

    Recruiting is a basic economic function, so at some level, every economic entity has to peform some aspects of it.

    This thread from just a few days ago goes into great detail on the same subject, if anyone cares to read it.

    be warned: it involves naked selling, but it is safe for work.

    http://www.ere.net/2011/01/21/stop-making-bad-tacos-or-how-to-establish-an-internal-executive-search-function/

  4. Brian Kevin Johnston

    Great article… I do know a few internal recruiting dept’s (NTAP for example) that do a great job, BECAUSE they “behave” like a TOP Agency… (Yes, “Recruiters also need to be retained, trained, and incentive’s to perform”)

    I don’t understand why if you are top 1% recruiter (results), you would settle for 100k (maybe) salary vs. 250k-1M+ with Agency or Independent…

    Perhaps someone could enlighten me?

    Thanks for the subjective article…

    Best to ALL, Brian-

  5. Martin Snyder

    Brian, Lou Adlers thread digs deep into that question, but the main answer is that million dollar earners (multi-million dollar billers) typically do a lot of business development to earn those bucks- so they are not only great recruiters, they are also outstanding rainmakers.

  6. Barbara Sarris

    Completely agree with Ginger’s comments regarding the internal recruitment function as adding more value, having more influence with managers, being viewed as partners and definitely understanding the business drivers both operationally and strategically. Looking in from the outside, is far removed from being internally inherent to the business as long as the recruiters in place are savvy, knowledgeable, quality performing talent acquisition professionals delivering quality HR recruitment performance!
    Barbara

  7. J Rorick

    Any argument that deals in absolutes is failed from the start. I can only presume (absolutely?) that this is some veiled infomercial for the author’s “services”. ERE can do better. This was articulated to some degree in Ginger’s comments above but a few points.

    Improving performance diminishes an internal recruiting leaders status? That is a ridiculous statement on its face. It implies that companies do not conduct merit reviews, provide bonuses (or continued employment for that matter) to the recruiting professionals on the team based on performance. I suppose they are put into a different assessment bucket than the rest of the organization? This is excluding the fact that many in-house firms do have metrics driven rewards apart from these items. Even sillier is the counter-notion that performing inefficiently would somehow build a recruiting leaders esteem in a company. Incompetence = improved status in the org?

    The other notions regarding stability are perplexing. In point #2 the stability of corporate leadership is brought up as an issue when anyone with half a brain in this field watches the sea of external recruiting professionals turnover at RPO’s, agencies and retained firms on a weekly basis (even if they are a fully out-sourced on-site function). External vendors have (right or wrong) a very bumpy reputation as a place where used car salesmen go to die. There are excellent vendor partners I have worked with over the years but the negative reputation prevails in the external recruiting world. And turnover is a well understood challenge of the external recruiting world.

    Last, the social media adaptability that is lauded on behalf of external functions is completely off-target. The first firms to embrace and successfully execute (to this day) on the social recruiting front were Big 4 shops who recruit like animals, internally. To claim that third party vendors who are seen by candidates as a full degree separated from the company they are trying get a job with are somehow a better at social media ignores two things: that social media/recruiting is only as effective as the conversation that is cultivated through these outlets and that conversation holds far greater weight if it is with somebody who works directly for the company; and second, third party vendors have been using the same approach to filling jobs for the past 30 years. To claim they are on the cutting edge because they have a “database” that purportedly plugs into social media is a lousy argument. There is nothing in an out-sourced firms toolbox that is not available to an in-house team.

    In the end articles like this highlight the real issue with recruiting/staffing: there is not enough professional preparation and true vocational support, starting in the college arena. Especially for a function that is such an integral part of how people obtain their livelihood and in many cases put food on the table and clothes on their back. This author only highlights that issue more with this poorly written piece.

  8. Steve Crumley

    Based on what factual data do you make the assumption that RPO providers are more successful, or even profitable?

  9. Martin Snyder

    The plural of anecdote is not data, but we have dozens customers doing RPO on various levels, and that appears to a top driver of market interest and movement for third-party firms, esp. outside the USA. It also appears (to us anyway) that the boundry of RPO work now tends to stop at the sourcing/presentation step, with organizations not turning over selection, forecasting, succession decisions etc. to outside vendors.

  10. Tom Fosgard

    Food for thought for sure! There are some great ideas on where our corporate departments may be lacking. I’ll be going through this article with a fine-toothed comb to ask ourselves in my department if we match up well to the RPO model.

  11. Dany Bourjolly

    I logged in specifically to leave a comment but my colleagues have my thoughts well covered especially Ginger Graham.

    I would add that at my former company (I just left 7 months ago) had a very strong promote from within culture. Given the volume and strategy of our environment, many of my recruiters went onto top sales positions, sales operations and research/consultant positions within the firm.

    We were proud of the ability to show that an internal recruiting function is necessary not only to the mission of HR and Recruiting but also our people went on to provide even greater business impact.

  12. Dr. Tom Janz

    Kevin: Why don’t you tell us what you really think? WHEW– that article certainly woke up the dozers! I sympathize with those recruiting professionals, and I have met several over the years, that strive daily to be the best they can be. The Lou Rabino’s at Compaq, the Jan Barr and Warren Moon’s at Chilis, the Lee Slater, Eden Britt and Henry Chamberlain’s at Standard Chartered Bank and the Chuck Neilsen’s at Texas Instruments. And there are many others I didn’t mention and haven’t met.

    However, I also appreciate the gist of Kevin’s point. Understanding behavior often means following the money (or other rewards, but mostly the money). Internal recruiting functions sometimes face cost discipline but almost never face the discipline of “doing the math” in any credible way on actual return (ROI, internal rate of return or Net Present Value), even when recruiting for P&L accountable positions where it’s not that hard to do. (We do it for free at PeopleAssessments.com!) RPO and external search regularly need to justify cost, (and thus show process efficiency) though mostly using market forces of competitive bids vs. a true understanding of actual return. Well, as Kevin points out, that is better than the presumption of value.

    The common problem facing both internal and external recruiting functions lies in how they are measured. They are measured for the ‘hireability’ of the talent they present to hiring managers, NOT the ultimate value of the job performance delivered by that talent.

    Valid assessment, as called for by Drs. Wendell Williams, Charles Handler, and myself (among others), will continue to be under-used until C-Level execs learn the difference between ‘hireability’– the probability that a hire is made from among the short listed talent presented– and the value of new hire job performance. Ah– tougher to measure you say. And it is so. So let’ just keep looking for that lost key under the street lamp here, even though we know we dropped it over there in the dark by the bushes– because, you can’t see anything over there in the dark! It’s high time to roll up our sleeves and ‘do the math’ on Quality of Hire, as in financial value per hire (a favorite tub thumper of Lou Adler’s over the pas year).

  13. J Rorick

    @ Dr. Tom Janz – while there is plenty of room for debate regarding proper incentives for a recruiting function (following the money as you state) little in the article is accurate (IMHO) outside of the presumptions of the author. External vendors rarely brings to mind “stability”. Internal recruiting leaders do not see improving their performance as a risk to their “status” nor as a risk to their budget. Showing the same or improved staffing performance at a lower cost basis is actually a feather in the cap of an internal recruiting professional. So little if any in the article has credence.

    Quality of Hire, as deemed by company leadership is a nice place to start, but that requires a long-standing relationship between recruiting/ER and management to agree on what are the effective measures of a contributor in their firm and how will it be measured. Supplanting internal recruiting with an entirely out-sourced approach, an entity driven by profit motive which I would argue muddies their concern for quality of hire, only makes this valid assessment more difficult. Unless you agree with the author that internal recruiting is transitory compared to external firms where the 20-somethings that do a good deal of the heavy lifting transition on an almost weekly basis. Just my two cents.

  14. Stephanie Willis

    Well said Ginger . . . Having spent the last 12+ yrs in recruiting (both agency and in-house), I would ask that the term “internal recruiting” be clearly defined in this discussion. I’ve seen many companies that say they have an internal recruiting function, but recruiting is simply a task that their HR generalists are required to manage (in additional to their benefits, ER, training, and other responsibilities). It is not fair to those of us that work in a true, organized and dedicated recruiting department to be lumped in this general term. Those of us that operate within a dedicate recruiting group tend to have very similar goals and metrics as our agency peers without the constant push to meet our sales targets. As part of the in-house team, our goals are to make quality hires that will become long-term employees of the organization adding to our overall talent pool. In-house recruiters also have the advantage to becoming true business partners and expert in their organization’s needs. How many agency recruiters are really interested in making a long-term fit for their client, rather than making certain to retain the candidate’s info so that you can reach out to them again in a couple of years for a new job and another fee? (I realize that this was a broad assumption, but it’s that would we are discussing here.) A quality recruiter will use the same arsenal of tools, regardless of their employer. It comes down to having a corporate environment that values the recruiting function and advocates its appropriate use. Both in-house and agency recruiting functions have a place in the staffing area. We are partners, not competitors.

  15. Keith Halperin

    @ Everybody: as many of you said, this seems to be “an old wine in a new bottle” or the restatement of a familiar position. IMHO, we need ALL kinds of recruiting functions: corporate, contract, RPO, contingency retained.
    They each have their places and prices:
    1) Most things that you would pay someone less than $100k/yr to do onsite can and should usually be eliminated, automated, or outsourced for $11/hr or less.
    A company paying people $60-80k/yr to work onsite to look on job boards or phone/internet source most positions, is wasting money, as they do when they pay $40-$50k/yr for someone onsite to schedule/coordinate interviews.
    What’s left for onsite FT recruiters to do: build the high-touch, high value-add knowledge, trust, and relationships mentioned, as well as move toward a Solutions Recruiting (We’ll help you get the work done!) model.

    2) If your internal people can’t provide a given service effectively, then you should be willing to pay for quality:
    $40+/name for sourced purple squirrels, 30%+ fees to get otherwise unobtainable candidates hired. If you’re trying to scrimp on paying for quality when it’s truly needed, then accept the consequences.

    Cheers,

    Keith

  16. Chuck Lotz

    Kevin,

    Thank you for the article. An outstanding job keeping all of us internal Talent Acquisition leaders from being asleep at the switch! And, Ginger, thank you for being the first to our defense. I share many of your thoughts having been in my seat here at First Citizens Bank for over seven years.

    While we continue to work on improving in many areas (social media, branding, process, financial ROI) our recruiters do an outstanding job of demonstrating their value each day with every hiring manager and candidate (customer) interaction. Given the uniqueness of our culture, values, and business approach, our recruiters are clearly in the best position to communicate the First Citizens Bank employment proposition. I would stack our team up against any other internal or external recruiting function in that regard. However, there are some terrific nuggets in the article for me and our team to discuss.

    Thank you for keeping us all “awake” and striving to be a value add function for our business.

  17. Wade Pierson

    Great topic/points for discussion. As the owner of an “On Demand” talent solutions firm, my experiences over the years with client engagements is that structurally, the most efficient/effective/results producing organizations are set up whereas it is a 60% (+/-) internal talent organization and a 40% (+/-) outsourced partner. Within the 60% internal group, that is where the “intimate relationships” are held, as well as the in depth cultural knowledge of the organization. The outsourced portion should always be in areas where the cost is cheaper (may be cheaper to outsource sourcing vs. building internal bandwidth), the skills are unique (may make sense to outsource tough to fill roles, or “unique” skill set roles), or the demand is finite and acute (you need to hire 50 sales people in 3 months because of some acute business dynamic, and then you will go back to a more typical demand for sales people of maybe 3-4 hires per month).

  18. Michelle R

    This silly question has been tossed out there so many times over the years it deserves a yawn now. Answer is simply yes. A company will always need an internal staffing organization even if it is small. For there are others things to consider within a company that needs to be taken care of beyond recruitment or sourcing: branding, compliance, tracking, metrics, talent and client group management, and on boarding to name just a few. Of course outside agencies have the time and resources to find that hard to fill position, they don’t have to deal with all those little details that gets someone in the door, nor the politics or diplomacy often required within internal teams. And no social media will not replace this function either – who is going to do the SM/posting/branding? Marketing, HR or someone will. It should be staffing as they are involved in the “sell”.

    I have worked as a corporate recruiter, contractor and had my own agency and I can tell you each side always complains about the other side and how “they don’t know what they’re doing”. Give it up already. The question you should be asking instead is, why don’t companies hire better internal recruiters and why don’t agencies train better? For there are incompetent people on both sides.

  19. Scott Boren

    I just multiplied the number of recruiters in our company by an average salary + bonus, added what we tell candidates our benefits are worth then added another $250,000 for fun.
    Then I multiplied the number of hires we have had 3/4 of the way through our fiscal year times a 20% fee (based on an average salary that is probably much higher than I used) and that number was 2 1/2 times higher than the first. And we still have most of a quarter to go. Hmmm. Where is the value in outsourcing all our recruiters?

  20. J Rorick

    @ Keith – if a talented experienced corporate recruiter (sub 100k to boot) sources at least three purple squirrels in an industry per year (and we all know it should be more than that) I have more than covered the excesses of a 30%+ fee. An effective internal recruitment function’s main achievement is often to have deflated the excessive spend on external recruiters -professionals who are doing nothing more than an effective in-house team should be accomplishing. There is a time and a place for partnering with external firms on particular projects and strategic search, but the bulk of external vendors make their success on the ineffectiveness or absence of a corporate recruiting function. Something that could be solved much cheaper internally if appropriately addressed and led. I agree with the sentiment though that a diversity of sources should and do come into play depending upon the staffing need, project and deadlines.

  21. Kevin Wheeler

    This article was intended to provoke comments, and at that it succeeded! There would not have been this level of response if there were no concern or fear on the part of recruiters.

    I can’t tell you how often I am asked by a CEO or CFO or COO why they should NOT outsource the function. Obviously, many of us are not influencing, explaining or providing the level of service that would preclude these questions.

    Of course, I have worked with several excellent, efficient internal recruiting functions. And I agree that a variety of choices, depending on needs and circumstances, makes sense.

    I did not wish to offend anyone, but to get all internal recruiters thinking deeply about what they have to offer and why it is worth more than going outside.

    And, in many cases, going outside despite the higher costs may be the better choice for reasons of quality and speed, but this is circumstance dependent.

  22. Joe Goss

    @Brian — If someone is top 1%, then perhaps he or she doesn’t belong in a corporate setting if money is a huge motivator, but ultimately, the two jobs are different. Many internal folks wouldn’t be happy working in an agency setting and vice versa.

  23. Keith Halperin

    @J:
    @ Keith – if a talented experienced corporate recruiter (sub 100k to boot) sources at least three purple squirrels in an industry per year (and we all know it should be more than that) I have more than covered the excesses of a 30%+ fee.

    This is true. However, if you truly were looking for purple squirrels who couldn’t be sourced for $11/hr, then you should hire someone like Maureen, Shally, Irina, or Glenn to get you good, quality names and contact information for $40+/name. If you got 50 names each of high-quality purple squirrel candidates for the three positions at $44/name (for example), it would cost you $6,600, less than one month salary for an intermediate-level internal recruiter, who would most likely lack the bandwidth and would almost certainly lack the expertise of our senior sourcing colleagues.
    My argument for using external firms for full fee is when you need them to accomplish things that can’t be effectively done through other means. An example of NOT doing this through other means would be to call an agency which charges 20% fee for a position which can easily be found with a search on major job boards, which you can get done for around $90/search/week.

    Cheers,

    Keith

  24. John Coelho

    Blah, blah, blah, and Blah!!!

  25. Tarek Pertew

    In my experience as an internal recruiter past and currently designing technologies for them, this article is unfortunately dead on. Humans in any field act quite predictably based on their rewards & punishments. As far as external vs. internal recruiters are concerned, the rewards and punishments (both of which materialize in the short-term for external and long-term for internal) are quite different, and thus their respective behaviors towards placing talent is different.

    So the urgency is different, the invectives are different, the pain points are different and thus the behaviors are different.

    We work daily to encourage internal corporate recruiters to pursue novel technologies, and unfortunately their perceived indifference is compounded so greatly by the opposite reaction of external recruiters, desperate to try any technology with promise…

  26. Keith Halperin

    @Tarek: Well said.

    I have rarely been solicited by either an ATS vendor or a client for my input on how to design things for the way recruiters and companies really are, as opposed to the way engineers, salespeople, and high-level staffing executives (who haven’t had to deal with a complicated, over-engineered, counter-intuitive system for years if ever) think they thould be.

    As I have often mentioned, I believe that beneath a thin veneer of rationality and pragmatism, recruiting (and much else) is actually strongly controlled by the GAFI Principles:
    Greed, Arrogance, Fear, and Ignorance/Incompetence.

    Happy Friday, Everybody!

    Keith

  27. Tarek Pertew

    @Keith

    Perfect

  28. dan albani

    In general, I have noticed internal recruiting departments in larger companies, typically get leaders rotated in, who were not cut from the recruiting cloth…which sometimes can be a primary reason why their recruiting departments are not as effective as they could be.

    There are also internal recruiting departments led by strong recruiting leaders that truly make thier team equal to or better than your standard agency.

    I also see a trend of larger companies building thier own in house ragency ecruiting teams, to cut down on fees. This can be a huge, if these in house agencys are run by people who understand how to run an agency. It seems, most in house recruiting departments are being built by leaders who do not have a solid background with agency work…which brings us back to my intial point…it is all a function of how good the leader is!!

  29. David Sadler

    I’ll keep it short as I don’t have much time or energy for postings.

    This article is probably very true in the context of the recruiters you know.

    I would recommend upgrading your contact base to upgrade your knowledge-base. The best recruiters I have ever met are “Internal” and I don’t think you can make a “whole-sale” statement like this – at-least not a credible one.

  30. Andrew Gadomski

    Tough to ignore this one. Given what our firm does (shameless plug) of course there are awesome internal recruiting organizations that perform in a fashion better, cheaper, and faster than external ones.

    So lets talk about efficiency and its importance. We service both commercial (RPO, agency, etc) and corporate recruiting organization, so we have seen it on both sides, and I can tell you this – what is efficient in one is NOT efficient in the other.

    If you need to lose 100 pounds, and you lose 80, you look better than you did, right? That concept is the primary difference between corporate recruiting and commercial recruiting. Corporations get efficient enough usually to get the service to be good or great, and commercial recruiting (agencies, RPOs, researchers, etc) have to be good enough to turn a profit. Put simply, the level of efficiency it takes to be effective is different than it is to be highly profitable.

    This has equated into an dichotomy in the market, where agencies/RPOs/etc have had to be really good at some things to survive and earn, and corporate recruiting has learned OTHER things in order to service the business effectively. Obviously there are tasks that are shared, and in some cases have become a commodity. I am sure both groups can see if someone passed a background check with the same efficiency.

    @Kevin W – I don’t think your point is actually so far off, but I think the wording is. I would question whether if we need internal STAFFING, not recruiting. Well before the “war on talent” was here we had administrators, HR managers, and managers themselves processing applicants, posting jobs, setting up interviews, and getting I9 forms done. Of course the ATS made this much easier in the past several years. Before we throw any babies out with bath water, I am believer that when it comes to talking about the brand, convincing people to apply, talking about what its like to work here, and presenting the promise – hearing it from internal people is best. Helps of course if those internal folks know how to talk that way, which I think is stated well in your article.

    @wade – agree, flexible staffing makeup is critical in today’s economy.

    @ginger – nicely put – keep it up.

    @keith – I agree with using agencies too – when its warranted. You talk about purple squirrels, I prefer to talk about brown bears. Most squirrel hunters are not brown bear hunters. You can find purple squirrels versus grey ones with research, networking, etc and use the same equipment to shoot as you would a grey one. Brown Bears (300k plus salary, board members, etc) are easy to spot – get a hoovers account. But trapping them and getting them takes a set of tools that some internal corporations don’t have, and IMHO don’t always need based on volume.

    @stephanie – like your style – you are dead on about partnership.

    @Dr Tom Janz – like the quality of hire argument, and getting a recruiting organization to run like business is really tough. But I am not convinced that Quality of Hire is actually something you want to measure at the individual level. I have heard and read plenty writtne by others about this, and I think job transience, social networking and technology have just changed the game too much.

    HR/Talent/Recruiting will likely continue to be a service organization, and will likely always struggle with “your only as good as your last search”. Which is why you have to measure quality of HIRES (with an S), not quality of HIRE. Its about measuring how the 100 engineers that were hired over the last 2 years innovated as a group and introduced better technology than the competition which yielded a spike in downloads for the past 12 months.

    Or how the sales group that went from 40% turnover to 15% turnover now sells 15% more per person.

    Or how by changing the job descriptions, competencies, interviewing questions, and training requirements in safety reduced OSHA recordables.

    The team is always worth more than the sum of the individuals, so I propose measuring QoHs (Quality of Hires) that way.

  31. Joseph Murphy

    The dialogue is all good. Kevin’s main point may really be rooted in economics. When an internal team has the same mandate to measure, track and report economic impact that an external provider does, there is most likely performance parody.

    Unfortunately, the issue lies with the fact that many CFOs and CEOs do not hold internal recruiting teams accountable to document contribution. And without economic accountability, the accounting infrastructure to document contribution is often lacking. A vice president of sales or manufacturing would never be allowed to operate with the poor economic reporting and accounting infrastructure that is deployed for the business process of recruiting. As such, it is common for internal recruiting teams to use ATS based reporting, thus relying on activity based measures instead of economic measures.

    Henry David Thoreau gives us words to ponder for this situation: “It is not enough to be busy, so are the ants. The question is, what are we busy about?”

    One gauge we use to explore the economic accountability of a recruiting team is how literate they are about job-specific performance metrics and how quickly they can access data sets of performance metrics. Ask a staffing professional, internal or external, if they measure and report on the cost of time to proficiency (total investment from sourcing to self-sufficient performance) for the position with the highest hiring volume. Ask who owns the budget for staffing waste http://bit.ly/97KSXp

    The answers to those questions reveal a great deal about the accountability expectations set by the CFO and CEO for recruiting.

    Reporting on days to fill, requisitions open, requisitions per recruiter, and opinion-based quality of hire while good to know are a bit like busy ant metrics. Recruiters with economic accountability document and report reductions in staffing waste and rework, increased yield in new hire productivity, reduced time to proficiency, increases in job family average performance metrics and the like.

    From my experience, corporate resources flow to those who build a good business case and then document return on investment. Outside providers have to do this to earn repeat business. The best internal providers do so as well.

  32. Martin Snyder

    Joe, performance parody is SOP at Main Sequence !

  33. Joseph Murphy

    Ooops, performance PARITY…., as for parody is SOP at Main Sequence…. ;-)

  34. Keith Halperin

    I am a firm believer in performance metrics, as long as it takes no more than 5% of my time to compile.

    Keith “Dammit, Jim, I’m a recruiter, not a bean-counter!” Halperin

  35. I Hire People » Outsourcing and the Recruiting Function

    [...] Wheeler had an interesting post last week on ERE about internal recruiting teams vs. recruiting process outsourcing firms. It’s a good thought [...]

  36. Brenden Wright

    I guess it’s all about money, huh?

  37. Keith Halperin

    Not ALL about money:
    Greed, Arrogance, Fear, Ignorance/Incompetence- these are what runs recruiting (and many other things ,too)….

    :)

  38. Strategic Recruiting Issues and Trends — Fire Away with Kevin, Lou, and John - ERE.net

    [...] future of outsourcing — Kevin Wheeler recently wrote an article highlighting areas in which internal recruiting has stumbled and where outsourcing will grow. I am much more pessimistic, in that I have found little metric [...]

  39. Strategic Recruiting Issues and Trends — Fire Away with Kevin, Lou, and John

    [...] future of outsourcing — Kevin Wheeler recently wrote an article highlighting areas in which internal recruiting has stumbled and where outsourcing will grow. I am much more pessimistic, in that I have found little metric [...]

  40. Is er een toekomst voor in-house recruitment? | Recruiter | Recruitment Matters - Alles over online recruitment

    [...] of ……. ? Kevin Wheeler gooide onlangs de knuppel in het hoenderhok. Discussie uitlokkend schrijft hij te signaleren dat interne recruitment afdelingen “aanzienlijk” slechter presteren dan externe [...]

  41. Three To See – w/c 24-Jan-11 « TalentJunkie

    [...] Kevin Wheeler provoked quite a debate on ERE with his post: Do We Need Internal Recruiting at All? [...]

  42. Agencies or internal recruiters: who’s dying? | RecTec

    [...] and Kevin Wheeler, stated two total opposite things in their ERE articles. While Kevin asked if internal recruiters were usefull and came to the conclusion that outsourcing recruitment is the way of the future, Matthew made a [...]

  43. Bureaus of corporate recruitment: wie sterft uit? | RecTec

    [...] en die beide bijzonder vaak gelijk hebben gehad hebben een tegengestelde mening. Kevin Wheeler stelt dat bureaus de toekomst hebben, RPO het helemaal gaat worden en vraagt zich af of we in de toekomst [...]

  44. Blog EN HR solutions » Future of Talent Retreat (2) » Blog EN HR solutions

    [...] productiviteit en het kleine worden van de corporate organisaties. Wheeler is ervan overtuigd dat interne recruitment afdelingen niet de drive en de incentives hebben om succesvol en efficiënt het benodigde talent binnen te [...]

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