On Wednesday, November 12, 2008, more than 900 members of the ERE community converged online for a webinar led by ERE author, Dr. John Sullivan. The webinar focused on updating your employee referral program. The popularity of the topic during a time when many staffing organizations are facing tough situations speaks to the immense role employee referral programs now play in the modern staffing function.

While several questions were fielded throughout the interactive webinar, participants submitted more than 70 questions on issues relating to program design, program operations, reward trends, and impact on organizational diversity.

To drive better understanding of world-class employee referral program practices and support continuous improvement of a sourcing channel that has become the dominant source of quality hires for many organizations, our response to the questions submitted throughout the webinar will be featured in five separate articles this week. (Where possible, similar questions were combined to reduce duplication.) The first five questions are included below, and there are 38 questions total.

Our responses to the questions proposed draw upon our advisory experience with more than 200 global organizations, an in-depth research study detailing the practices of more than 240 organizations, and an end-user research study that examined the experience of more than 7,400 employees and their respective referrals from 28 different organizations. More detailed guidance on program design can be found in a Design Workbook written by Dr. John Sullivan and available at drjohnsullivan.com.

Those interested in truly developing a world-class program may also want to check out these past ERE articles:
Operating Referral Programs on a Limited Budget
Upgrading or Reenergizing Your Employee Referral Program
Employee Referral Program Killers
Budgeting for a World-Class Employee Referral Program
Metrics for Improving Employee Referral Program Effectiveness

ERE Community Q&A

The questions proposed during the webinar covered a great many aspects of operating an employee referral program including:

• World-Class Program Design and Features
• Program Reward/Bonus Trends
• Diversity Impact
• Using Technology to Support the Employee Referral Program
• Specific Program Mentioned During the Webinar

Questions on Program Design and Features

1. What is your suggestion for dealing with a company that may not be open to radical changes to the referral program, but obviously needs something to be done?
   Most HR departments are quite conservative, so resistance to change isn’t unusual! The one approach that seems to work everywhere is working with the CFO to build a strong business case for improving referrals. Top-performing programs produce tens of millions of dollars in positive business impact by filling key jobs faster, bringing in higher-quality hires, and producing hires who are statistically proven to stay longer. To make the business case for change, start by building out a comparison of on-the job performance using key jobs where the output of the position is already quantified and measured on a regular basis (sales and call center roles are often easy places to start). Then working with the CFO, do a side-by-side comparison demonstrating the average output of new hires after one year from employee referrals versus other external sources. If you have a well-designed program, the performance differential, when converted to dollar impact will be so significant that it will silence any critic. Review offer acceptance rates, new hire turnover, involuntary turnover rates, and the applicant:hire ratio by source to produce other compelling statistics to support your case for investing in strategically managing the ERP. I know of one firm where the estimated impact was $46 million in one year. In short, don’t expect anyone to welcome change unless you can “show them the money.”
2. What about the life span of employee referral programs? Don’t they typically become less effective over time? The answer is yes and no! Our research revealed that in many organizations the employee referral program was implemented with a “build it and they will come” assumption. Unfortunately, for the average company, that isn’t always true. World-class employee referral programs rely heavily on encouraging employees to act when you need them to using effective communications and rewards. From that perspective, ERPs are essentially marketing efforts, and like all marketing efforts, they can become less effective over time if not managed. Organizations often launch their programs with a flurry of communications, then sit back and do nothing for a number of years; yes we said “years.” Our research found that the average employee referral program gets reviewed and refreshed on an average cycle of 32 months. Using average growth and turnover statistics for the United States, one can assume that during that 32-month period, 48.2% of the employees who were present during the initial program launch are no longer with the organization and have been replaced by new employees. Add to those new hires employees hired during that time for growth initiatives and it is relatively easy to see how a majority of the employees in the average organization may not be that familiar with the program. To further complicate the issue, 41% of employees who have participated in their organizations program indicate that they are either “not sure” or unwilling to participate again based on the poor experience they encountered previously. When you start to stack all of the statistics and practices together, it becomes very clear that most organizations manage their programs to produce mediocre results over time. Top-performing programs re-invigorate their programs quarterly and have very strict user experience quality standards in place to ensure that employees and their referrals are treated as they should be, with respect and priority! If communications and reward methodologies are not being used effectively to drive program engagement, then you could expect to see program participation start to decline within six months of a program’s launch. Left alone, the participation rate and percentage of hires generated via the ERP will migrate back to natural referral levels (where they would be with no formal program) within 18 months. If your program is producing between 12-18% of hires via employee referral, you are operating in the natural referral range. Programs producing 18-28% would place you in the ad-hoc managed range, 29-45% indicates formal program management, and programs producing more than 45% of hires via employee referral represent the strategically managed program range.
3. How are other companies managing a referral program for alumni and retirees? Organizations have long understood that a great many “non-employees” have a vested interest in the success of the organization, including alumni, shareholders, top customers, vendors, consultants, etc. Unfortunately, many program managers and coordinators assume that participation in employee referral programs is driven by monetary rewards, so the idea of letting non-employees participate in the program becomes complicated with tax-related issues. What they say about assumptions is true, and you shouldn’t make them! Our end-user research, which polled the primary motivations of more than 7,400 employees who had made referrals in their organizations during 2007 revealed that only 11.3% were primarily motivated by the opportunity to earn bonus income. The primary motivation for more than 51% of those who had made a referral was the “opportunity to help out a friend.” More and more top-performing programs are moving forward with plans to open up their programs to non-employees. Instead of monetary rewards, they are going “old school,” with personalized thank-you notes, preferential treatment, discounts on company products, etc., none of which involve nasty tax issues! Maintaining the relationship with alumni via the employee referral program has another benefit. By communicating with former employees on a regular basis about what is going on in the organization and disclosing your critical talent needs, you may earn the change to “rehire” past top performers (known as boomerangs). These “alumni programs” are quite common in major professional service firms. Rather than approaching all alumni, target high-performers and individuals who formerly worked in hard-to-hire positions. These individuals know your firm and its needs and have the capability of making high-quality referrals even if they don’t return.
4. Any advice for high-volume referral programs?
   Like all systems, employee referral programs can be designed to produce whatever results you want within reason. While we typically advise organizations to refine their programs to reduce overall volume and produce higher-quality hires in a small number of key jobs, many of the same concepts can be leveraged to produce a high volume of applications for high-volume roles. Professional service firms, banks, transportation companies, and other labor-intensive industries where revenue production is limited by the number of deployable human resources are all in need of high-volume referral programs. There are several program design elements needed to support high-volume referral programs, including:
   • A highly scalable infrastructure. High-volume referral programs must be supported by an administrative infrastructure capable of delivering a world-class program experience to all referees and referrals during huge shifts in inbound volume.
   • A strong communications function. High-volume programs must be able to communicate specific need/business case messages to distinct employee populations to drive participation in specific regions, roles, etc. when needed.
   • Role specific reward schema. Employees in high-volume roles often know exactly the impact they have on their organizations’ ability to meet financial and quality performance targets. For that reason, the reward schema in such organizations must be role-specific, and the business case must be strong for ee’s to participate.
   • Leverage technology. Processing several thousand inbound referrals and ensuring that each receives a consistent quality experience is a monstrous task. As referrals are not yet applicants, dumping them into the ATS is probably not the best way to manage them as a highly cherished population (applicant databases truly are huge pools of people, the vast majority of which your organization will never hire.) High-volume referral program managers should consider investing in CRM technologies to capture referrals as leads, segment referrals using multiple criteria, drive specific messaging to referrals based on criteria, and manage referral program workflow until the referral technically becomes an applicant.
5. Advertising a raffle with a large gift (i.e., college tuition, car, vacation) sounds great, but won’t that encourage employees to refer people who aren’t necessarily top performers? Any reward schema that awards the chance of getting a highly valued reward will incent some degree of undesired behavior; the key is to balance the reward with process elements that dissuade such behavior! You want employees to actively be looking for great talent, to approach that talent, to pre-sell it on your organization, and to refer it, but for most organizations that doesn’t happen largely because the program design doesn’t drive that behavior. In the average organization, 37% of all referrals are virtual strangers to the employee making the referral. They may have been approached by someone they know to refer a friend of theirs, or they may have been approached by a total stranger online asking to be referred. In the average program, the ee’s only role is to fill out a small form that send a hyperlink to the applicant, who then fills out the same application anyone else would online. There are four key design elements needed to ensure quality referrals, elements many programs overlook:
   • Employee education. Organizations need to become much more specific when communicating with employees about what they need, and what they don’t want! Believe it or not, 87% of the employees that participated in our end-user experience research indicated that they are not satisfied with the amount of training with regards to making referrals that their organization provides. They want to know more about how to approach great talent within their networks, how to build a relationship with top industry talent they would like to add to their network, and how to better sell their organization.
   • Expanded employee role. How the typical employer leverages its employees in the typical employee referral program is truly almost criminal. Employers need to leverage the employee to pre-assess referrals prior to submitting them. The submission process must be revised to capture information on how the employee knows the referral, what about them makes them a good fit for the organization, what about their skill set makes them a good fit for the role they are being referred for, and last but certainly not least, where the employee would rank the referral’s ability to perform on a five-/10-point scale if hired.
   • Feedback. We know that labor attorneys often advise organizations to say very little about why someone doesn’t get hired, but if you did everything labor attorneys advised, chances are you would never hire anyone! World-class referral programs are all about leveraging personal relationships, relationships that need to survive even if a hire is not generated. Ensuring that the employee remains willing to participate again, and that they can better screen talent in the future requires that you provide feedback to them on why their referral doesn’t get hired. (If you think they are not already making excuses that could or could not be factual, guess again.)
   • Consequences. Everything you do in life comes with them, but for some reason most organizations left them out when it comes to flooding the referral program with crap. While we are against implementing an encyclopedia of rules, we are all for making it clear that participating in the employee referral program is a privilege, one that can very easily be revoked for employees incapable of acting like a mature adult committed to the success of the organization.

Cost containment is easy and is by no means strategic, but leveraging limited resources and restructuring activities to accomplish things you couldn’t do previously can be. Unfortunately, most corporate recruiting managers and many line recruiters are more reactive and incapable of looking at staffing more holistically.

Managing strategically requires recruiters to think beyond immediate requisition loads and transactional sourcing; it requires that recruiters think more proactively, and identify strategic talent opportunities.

One opportunity that routinely presents itself during economic contractions is the opportunity to trade up the caliber of talent in the organization by swapping in top talent into roles currently occupied by average or below-average talent. For socialists and poor performers this strategy seems harsh, but for anyone who has ever played a competitive sport, it makes perfect sense.

As global markets open up, competition on every front in business is becoming more cutthroat. In an era where an organization’s sustainability and innovation capability are largely tied to acquiring, developing, deploying, and motivating talent, a talent-swapping strategy could mean the difference between mediocre business performance and explosive business performance.

What Is A Talent Swapping Strategy?

The concept of talent swapping is borrowed from the professional sports industry. In sports, winning is everything, and it is a common practice for team management to externally seek out a “superior” player in a key position to replace a struggling player. When the team finds an available star, they “SWAP” or replace their struggling player. After the swap, the team still has the same number of players (no additional headcount), but has also dramatically improved its chances of winning.

When applied to the corporate world, a SWAP (Strategically Waving Average Performers) initiative proactively replaces poor performers in a key job only when an arguably/measurably better candidate has been identified and successfully recruited by the talent management function.

Factors Making Talent Swapping Possible

Talent swapping is a strategy that can be employed anytime, but it is much easier for organizations during times of economic contraction for a number of reasons, including:

• Talent Availability – When unemployment is low, chances of landing a true top performer without a fight are low, but as unemployment rises, so do your chances. During economic contractions even top-talent magnet firms face challenges. As they shutter growth initiatives, cut development budgets, restrict internal movement, etc., the ties that once held top talent firmly in place loosen, enabling firms that couldn’t compete before to make a compelling offer.
• A focus on headcount – These days more and more CFOs have a background in accounting as opposed to finance, so cost-containment is in vogue. Across the board cost-containment strategies frustrate top talent, and theoretically cut recruiting functions off at the knees as requisitions dry up. A talent swapping strategy restores the need for recruiting and sends a message to top performers within the organization that despite cost containment the organization is working hard to advance working conditions and remove below-average performers that hold top performers back.
• A focus on productivity – In years past, the pressure from consumers for new products and innovations waned during economic contractions, but that is no longer the case. Product lifecycles have gotten shorter and shorter as demand for innovation has skyrocketed. As a result, organizations are under tremendous pressure to increase workforce productivity and innovation despite a contraction in their revenue streams.

The Advantages of Talent Swapping

The first obvious advantage of talent swapping is that it is a performance improvement strategy with a very clear objective, improving the organization’s overall ability to perform. However, there are a multitude of other advantages, including:

• It provides recruiting leaders with a rare opportunity during low hiring times to demonstrate positive business impact.
• It provides individual managers with a means to manipulate their team structure and capability without impacting headcount during a time when most changes are frozen. (During economic contractions underperformers are often kept on much longer than they normally would be because many managers believe that even a poor worker is better than no worker at all (i.e. a vacant position).
• It sends a clear message to all employees that continuous improvement of skills and ability to perform is as much an individual’s responsibility as it is the organization’s, and provides real consequences for those who ignore the mandate.
• It challenges managers’ reluctance to fire even the worst-performing employee by allowing them to postpone the hard decision to terminate a team member until a clearly superior replacement has been found and hired.

Swapping Must Be a Data-Based Activity

Not all managers have their organizations’ best interests in mind all of the time (some might argue that the vast majority of managers never have their organization’s best interests in mind, but that is another issue).

As a result, it is important that organizations employing a talent-swapping strategy rely heavily upon data when making decisions about where to apply talent swaps. Recruiting leaders need to work closely with hiring managers and the performance management function to identify key jobs that have incumbents in them, that after numerous attempts to improve their performance have proven incapable of becoming top performers. A business case must be developed with the full involvement of the manager, the performance management function, the recruiting function, an executive program sponsor (CFO/CEO/COO) and legal counsel for each swap proposed.

What About Legal Issues?

Whenever you release or terminate workers, there is some risk that they will become disgruntled and sue the organization arguing one thing or another. The key here is to make the mandate for the program known to everyone, keep the process free of bias, build a documented case for each transaction, and treat the outgoing employee with respect and dignity throughout the process.

Should your legal counsel or other in HR pose objections, it is important that senior leaders remind everyone that “it is not anyone’s job to tell the organization what it cannot do, but rather to find a way to do it!” While people are not machines, they are vendors and organizations routinely “swap” vendors and suppliers based on newly available prices, competencies, and services.

Action Steps

Talent swapping is relatively easy to understand and to implement. Some key action steps might include:

1. Begin by calculating the long-term economic consequences of keeping a below-average performer, compared to the increased performance level of an above-average performer (the difference is known as the performance differential). If you carefully calculate the dollar value of the performance differential between a top performer and the “targeted” below-average performer, you will often find that it’s two or three times greater, resulting in over $100,000 annual difference in output. Next, multiply the costs of keeping a weak employee over the number of years that the bottom performer is likely to remain at your firm to get the total dollar value of swapping an employee.
2. Develop a formal plan and get the necessary buy-in from HR, performance management, and your recruiters. Be sure and run it by a few operating managers to identify any potential issues or concerns they might have.
3. Get the CFO’s buy in for the talent-swapping strategy.
4. If possible, get a business unit head to conduct a pilot and to “champion” the program among their colleagues.
5. Develop a process for identifying the key business units and the jobs within them where replacing below-average talent with top talent can make a significant impact upon the business. Talent swapping is not appropriate for every position.
6. Within those jobs, work with performance management and individual managers to identify the weak performers to target. Work with “legal” to see if there are any further actions that need to be taken before the employee is deemed eligible for a SWAP. Include a diversity component to ensure that diversity levels are maintained.
7. Define the minimum skill set (skills, capabilities, and experience) that the potential new hire must have to become “eligible” for a SWAP.
8. Develop a continuous sourcing strategy for the targeted positions. Also be aware that using traditional employee referrals to identify candidates might cause problems if employees realize that by making referrals, they are helping to replace an employee who might be a friend.
9. Begin building a “who’s-who” list of the names of the top talent in your industry who might be amenable to taking one of your targeted jobs.
10. Conduct “relationship recruiting” with these key individuals from the list. This might mean calling them occasionally, periodically sending them an e-mail newsletter, or inviting them to your company’s events.
11. When you become aware that one of your targeted candidates is now available, recruit them and offer them a position. If they accept your offer, you then notify the performance management function to begin the release process of the current poor performer. When appropriate, and especially in certain international locations, consider offering the released worker a financial severance package for signing a legal release.
12. Bring the new candidate on board.
13. Continue the process until you have substituted top hires for each of your targeted positions.
14. Remember that you can also swap talent “internally” by moving top performers from low-impact to high-impact jobs.
15. Another option to consider is rather than waiting to release workers who are clearly bottom performers, instead shift them to a contract or contingency basis. This “temporary” status allows you to more easily release them if there is a need for a layoff, a performance termination, or a talent SWAP. If their performance improves, you can obviously shift them back to a more permanent status.
16. Run the metrics and then calculate the overall performance improvement and the dollar impact as a result of the improved performance of your new hires, compared to the released employee.

Conclusion

I often encourage managers to look at the best practices in sports management because there are few other fields where the value of having top talent is so easily seen and appreciated. In sports, the intense competition and publicity causes managers and directors of player personnel to identify and implement some extraordinarily powerful talent-management practices that can also be applied to the business world.

The talent SWAP approach is a prime example of one of those best practices. In sports if you have a losing team and you want to become a winner fast (because there are limits on roster size), often your first step is to change the players through talent swapping.

It’s no secret that managers are reluctant (to say the least) to fire workers (even bottom performers). Talent swapping makes firing more palatable to managers because they don’t have to act until a quality replacement is available. CFOs see the value of the program because it increases performance, without increasing headcount. Recruiting managers should support it because it provides them with an important and visible role during economic downturns, when recruiting can be seen as unimportant or unnecessary.

I urge you to consider adding it to your repertoire of recruiting strategies. Only socialist HR types are likely to be afraid of it, and you should never let them run your business. Instead of being reactive and waiting for requisitions to come across your desk, now’s the time to be strategic and proactive. Think about it, what could be more obviously beneficial to a firm then replacing a group of “Turkeys with Eagles!”

Unfortunately, most onboarding programs are poorly designed and even more poorly executed. After years of researching and advising firms on developing best-practice programs, I have found that there are 15 key factors that can literally kill any chances of onboarding programs demonstrating a positive impact.

The Root of the Problem

Most corporate onboarding programs are designed from the HR administrator’s perspective. The goal and focus is to ease the administrative burden on HR and to drive compliance activities, not to ensure that new hires can reach expected levels of productivity in the shortest time frame possible.

As a result, most programs have boiled onboarding activities down to all but the bare bones of administration. Every new hire, transfer, or merged/acquired employee gets the same information, on the same timeline, via the same channel.

Doing so has made administering onboarding easy, cheap, generic, consistent, and utterly useless. The result is that most onboarding programs frustrate new hires and hiring managers.

While the concept behind onboarding is truly simple, delivering world-class onboarding is anything but easy and generic. If your current approach demonstrates any of the 15 onboarding program killers described below, you’re missing the mark and need to start over:

1. The wrong definition and limited goals. The first and most impactful error is to define the program as orientation as opposed to onboarding. The term orientation has for years been applied to the narrower range of corporate activities related to “sign up’s” and providing basic information. The goals of traditional orientation are relatively narrow: to get new hires on the payroll, signed up for benefits, and to provide a brief overview of the company’s culture, products, and values. Onboarding, however, has a much broader perspective and goal: to decrease the time it takes for a new hire to reach the minimum expected productivity level on the job. Onboarding (also known as assimilation) lasts longer, occurs at several organizational levels, is metric-driven, and has a greater business impact.
2. Overloading new hires. The most common program killer is overloading new hires on the first day with a volume of information and questions that result in sensory overload. Because new hires are apprehensive, putting them under this kind of pressure makes it unlikely that they will ask tough questions, make good decisions, or remember a majority of the information they are provided with. The best programs limit the amount of information provided and the number of forms and sign-ups required so that they encompass less than two hours on the first day.
3. Failing to extend the timeframe. Viewing onboarding as something that happens only on the first day of employment is a major program killer. The best programs start before the employee’s first day (pre-boarding) and continues for up to six to 12 months. By stretching out the process, you help to ensure that the new hire is not overwhelmed on their first day.
4. Not offering onboarding at multiple organizational levels. Failing to provide information at each organizational level guarantees that the new hire will spend a great deal of time operating blind. The five organizational “levels” of onboarding include:
   • Corporate level. Covering signups and corporate-wide values.
   • Location level. Covering information and issues related to the country/region and the plant/facility where the new hire will be working.
   • Departmental level. This level covers things related to the department the new hire is joining.
   • Team/Job level. Covers things related to this person’s work team and job.
   • Individual level. Covers things at the team level that relate to the unique and diverse needs of this individual.
5. Unidirectional information. Most programs focus entirely on providing the information that the corporation wants the new hire to possess through presentations and videos. Unfortunately, this unidirectional approach lacks interaction and it can make the new hire feel like little more than a “hard drive” for receiving information. In addition, it restricts the firm’s ability to understand the new hire’s needs/concerns. The best programs directly ask new hires about their concerns, who they wish to meet, what they wish to learn, and how to best motivate and manage them. They also ask new hires for referrals and they gather feedback from them on how to improve both the recruiting and the onboarding processes.
6. No metrics or accountability. Most orientation and onboarding programs are not designed and run like standard business processes. Few have any objective results metrics that make a specific individual accountable for producing measurable business impacts. The best programs include metrics that cover time to productivity, new hire retention/termination rates, new hire error rates, new-hire referrals, and program ROI. Hiring managers also need to be held accountable by including their onboarding success rates in their performance appraisals and their bonus formula.
7. Ignoring diverse needs. Although nearly every corporation makes a special effort to hire diverse individuals, few onboarding programs provide alternative approaches to meet the needs of diverse hires. This is critical because diverse individuals, by definition, have different needs and ways of processing information. As a result, there must be variations in the onboarding process (either different information or the same information presented in a different way). By varying the information to meet individual needs you can dramatically reduce diversity frustration and eventually diversity turnover.
8. A face-to-face approach. Although this is gradually changing, a majority of onboarding activities are still provided in a live meeting. Not only is this time-consuming and expensive, it also limits the new-hire’s ability to access this information later on, when they might actually need it. For “remote workers,” not having online access can dramatically slow time to productivity. A superior approach focuses on providing most, if not all of the necessary onboarding information online where it is more easily accessed and searched before and after they start their new job. Online information can include the standard information provided to new hires as well as interactive forums for asking questions, buzzword and acronym dictionaries, as well as photos and bios of team members. In truly global corporations, the need for online information is even more critical.
9. A lack of integration. The very best onboarding programs make a special effort to integrate and coordinate what are traditionally independent activities. The program needs a process that integrates and coordinates benefits enrollment, payroll registration, technology set-up, security registration, business supply delivery, office assignments, new hire training, and “local” onboarding activities at the departmental level.
10. Failing to make the manager’s expectations clear. Information should be provided on corporate success measures, departmental plans, strategies and goals, how this individual’s performance will be assessed, their bonus and promotion criteria, and specifically, what is expected from them during their first week and month on-the-job.
11. Their manager is not present. The most common fault that occurs at “departmental level” onboarding (and the one with the most negative impact) is not having the employee’s direct manager present on the first day. With the manager absent, often the new hire feels unimportant and frustrated. Invariably, in the absence of the manager, new hires are shown their cubical, given “a manual” to read, and told to be patient until their manager returns. The best programs do not allow a new hire to start without their manager present and a plan of action for the first month of the new hire’s employment.
12. No compelling business case. Support for great onboarding programs is unfortunately very cyclical. Programs typically receive a great deal of support when competition for talent is high but they are often cut back or eliminated during tough economic times or whenever the program’s manager moves on. If you want to avoid this painful cycle, it is essential that the onboarding program be covered by a formal “business case.”
13. Run by benefits. Generally, benefits people have a narrow and tactical view of both HR and onboarding. Their view of the process is focused on “sign-ups” and having everything done quickly the first day. In order to be strategic, the program must be “owned” by hiring managers and run by recruiting or employment brand managers.
14. Failing to reinforce the employment brand. Colleagues and friends will contact the new hire during their first week, and if the onboarding program doesn’t provide a great “new hire experience,” they might provide limited or even negative information.
15. Delays in offering onboarding. Organizations frequently postpone most onboarding components until a large group of new hires can participate in a single session. Any delay can negatively impact new-hire productivity and provide an opportunity to make mistakes that will later be difficult to erase. As a result, effective programs offer online onboarding or do not delay onboarding beyond the first week after the employee is hired.

Weaknesses and Problems in Program Administration

There are several common omissions or failures related to the administration of the onboarding program that, although not program killers, can negatively impact the results:

• No written plan. Most onboarding programs have no formal written plan that is integrated with the overall business plan, the HR plan, and the recruiting plan.
• Owned by HR. Rather than being owned by HR, the onboarding program design should make it clear that onboarding problems and processes are “owned” by hiring managers. Managers must realize that they suffer the most when poor onboarding takes place.
• Jobs are not prioritized. Because there is never enough budget, world-class onboarding programs rarely excel unless they prioritize and focus their talent, time, and resources toward onboarding individuals in mission-critical jobs, critical business units, and in jobs with a significant revenue impact.
• No continuous improvement component. Few onboarding programs have a component that allows them to continually improve. In direct contrast, the very best have a formal process for continuously assessing and improving processes and output results by assessing each on-boarding success and failure. Exceptional programs periodically use “mystery shoppers” to identify system problems.
• No best practice sharing. The onboarding program must have a formal design component for the rapid identification, sharing between business units, and the adoption of best practices related to onboarding.
• No data-based decision-making. Major onboarding program design and resource decisions must be made based primarily on data, rather than emotion or historical practice.

Final Thoughts

It’s a critical mistake to build a high-impact process based solely on intuition. A superior approach requires that you examine the “root causes” that drive success and failure. Part of that process includes identifying “critical success factors” which cause programs to succeed and “program killers” that can doom an otherwise well-designed program.

If you want to raise your game, it’s critical that you periodically assess your program design to ensure that it is rich with critical success factors and that it steers clear of program killers.

Editor’s note: Those interested in learning more about leveraging onboarding and orientation to improve new-hire productivity can read Dr. Sullivan’s new book, entitled The Onboarding & Orientation Toolkit, available at www.drjohnsullivan.com.

It defined succession planning and why recruiters can and should play a role in a modern, world-class succession planning program. Part one also concluded by listing a series of metrics to evaluate existing programs based on their usage and design.

In part two, the focus will shift away from discussing what makes a great program to covering metrics that demonstrate what a great program accomplishes.

Part B: Plan Output or Success Measures

Group 3 – Output measures of plan success

The best plans have goals (and measures) that cover each of these areas:

1. Percentage of all management positions filled by internal candidates (this is the broadest measure of development success because it covers all management and leadership positions). A high rate of internal placement (vs. external hires) can be considered as an indication that development efforts have been successful.
2. The success rate of external hires over internal moves for plan jobs. Good development should result in a higher success rate (performance and retention) for internal moves.
3. Percentage of interviewees for plan positions whose positions are designated as ideal jobs for stretch assignments. Ideally, 100% of the interviewees for open plan positions will be “on” the succession plan.
4. Percentage of actual movers on the plan, where “movers” are the individuals who were actually transferred to or promoted into any designated plan position. Ideally, 100% of those actually selected from the interviews will come from the plan.
5. Percentage of movers without the most tenure in the job. Natural movement generally means the candidate with the most tenure will receive the nod. Effective succession planning periodically selects a “not so obvious” candidate from those being interviewed.
6. Percentage of movers from another department/business unit (again, “natural” movement generally means most positions are filled from within a department).
7. Percentage of movers who jumped a level (natural movement generally means promoting individuals “up” one level). Successful succession planning occasionally promotes individuals more than one level up.
8. Percentage of “on plan” movers who get promoted again (if a promoted individual is promoted again within three years, that can be considered as an indication that the first promotion was successful).
9. Percentage of movers placed in their targeted business cycle. Innovators are placed in departments or business units that require innovation (i.e., start up business units). On the other end of a business cycle, efficiency experts are placed in cost-cutting or commodity business units, where their skills are a better fit to the business cycle that the unit is in.
10. Percentage of job openings predicted accurately (successful plans prepare the individuals for movement at a designated time. Plans that successfully forecast openings within six months of their “projected time” are more effective than those that prepare individuals well before or way after they are needed).
11. Percentage of jobs with a defined back-fill person for sudden openings. In some plans, having “backfill” replacements are considered to be a separate plan element. Effective plans have pre-identified qualified and tested individuals that can immediately fill a sudden “unplanned” opening, without a loss in productivity.

Group 4 — Indications of plan failure

In addition to the factors that make a plan successful, there are some events that demonstrate the plan has, at least in part, failed. Indications of obvious failure include:

1. Percentage of “on plan” movers who fail during their first movement after being put on the plan (an individual who must be removed from their first placement because of a bad “fit” or performance must be considered a failure).
2. Percentage of movers who fail to stay in the “moved” position for at least two years (if someone must be removed or they voluntarily leave a position that they’ve been placed in, the placement can be considered a failure because of the obvious negative impact that it will have on business performance).
3. Percentage of individuals on the plan who fail to stay with the firm at least four years (retention rates are important, so you must consider it a failure whenever someone on the succession plan is forced out or voluntarily leaves the firm).
4. Positions filled by external hires who were not “on the plan” (if a plan has a provision for including external candidates in your succession hierarchy, consider it a major failure each time an “off plan” external hire is made).
5. Percentage of individuals who are removed from the plan. It is essential to keep the plan vibrant by periodically “dropping” those who have failed to meet their development or performance targets. However, too high of a percentage being removed each year must be considered as either a failure in selection or a failure in development.
6. Percentage of plan jobs vacant for more than 30 days. Effective succession processes fill plan openings rapidly, because the ideal candidate was successfully developed and prepared in advance. As a result, whenever a plan position remains vacant for more than 30 days or when it must be filled with an unplanned “interim” individual, it must be considered as a failure.
7. Percentage of “not promoted” finalists who leave in frustration within one year. Whenever someone on the plan is moved into a plan position, obviously you have been successful. However, if any of the other “finalists” who were “interviewed” but later rejected for a particular position leave the firm within a year, consider that promotion at least a partial failure. Turnover among second or third choices is not unusual, but it should be prevented whenever possible because of the high costs associated with losing any individual with sufficient qualifications to be considered a finalist.

Group 5 — Measures of direct business impacts

The most powerful measures are those that demonstrate a measurable impact both on leadership development and business results. The three most direct measures of business impact are:

1. Dollars saved by avoiding the added cost of outside hires. On average, external candidates for leadership positions and mission-critical roles receive a significantly higher salary than internal hires (some studies show the variance as high as 165%). Because of this cost differential, one of the most obvious advantages of effective succession planning is the cost-savings resulting from selecting a larger percentage of internal candidates.
2. Percentage increase in team performance six to 12 months after a plan employee is moved into a leadership position. Less-direct measures of successful placements might include the percentage of bonus the mover receives (compared to the average), their performance appraisal score while in the job, or their relative ranking in forced-ranking exercises.
3. The cost of avoided errors. The total dollar costs of errors that would have occurred if leadership positions were vacant too long or if they were filled by below-average leadership talent.
4. Program ROI exceeds that of other HR programs (successful plans demonstrate to cynical CFOs that their benefits and dollar impact well exceed their costs).

Final Thoughts

When times are tough, a common characteristic of “survivors” is often their ability to shift their focus toward new and developing business needs. Obviously, when budgets are tight, headcounts aren’t likely to grow, but the need for great leadership talent will actually increase (because it takes great leadership to manage under severe budget constraints).

If you want to increase your visibility and business impact, now’s the time to get involved in succession planning. Given the upcoming baby boom retirements, and limits on recruiting actual talent, the shortage of internal leadership and mission-critical talent will soon become the top HR issue.

Most firms strike a balance between buying and growing, although little if any strategic planning guides their decision. However, during tight economic times when recruiting budgets are severely restricted or even frozen, the emphasis almost always shifts dramatically toward “growing talent.”

If you are a recruiter or recruiting manager and you want to increase your impact on the business, a downturn is a signal that you should begin to focus on succession planning.

Why?

Tight economic times do not change the management demands for most organizations; in fact, decisions made during such periods will have a dramatic effect on how organizations can recover when the economy turns. So ensuring that the organization doesn’t have any critical holes in their bench for both leadership and mission-critical roles is a vital concern.

It is not uncommon for every employee to be asked to “do a little more” during hard times, which makes this a great time to develop talent using on-the-job projects. By speeding up “internal movement” and leveraging stretch assignments, managers can ensure that the right leadership and mission-critical talent is developed and ready to assume key roles that either open up as a result of turnover, retirement, or business growth.

If you see a slowdown coming in hiring volume, now’s the time to shift your focus toward succession planning.

What is Succession Planning?

Organizations use succession planning to help mitigate the risk of a vacancy occurring in key management and leadership roles that could impact the organization’s ability to perform.

In more strategic organizations, the scope of succession planning is expanded to include high-impact and mission-critical roles throughout the organization.

The activity looks at talent within (and in a few rare cases outside the organization) that can be developed to step into key roles on a timeline consistent with an anticipated vacancy. In essence, it looks to develop key players who can sit on the bench until needed. Positions with two or more possible replacements in development are considered to have a strong “bench strength,” while those with only one or none have little or no bench strength.

Why Tap Recruiters for Succession Planning?

While development for roles covered by the succession plan can include traditional training, more and more organizations are adopting a development approach that relies heavily on coordinating the acquisition of new skills or capabilities via rotations through roles that enable on-the-job learning and mastery of those key skills.

As product lifecycles have gotten shorter, so too has the timeframe with which organizations can develop talent. A few years ago, a manager in development may have had to sit in a role for 48 months in order to experience a full product cycle, but today that experience may only require a 10-14 month stint.

Given the changes in workforce demographics, global competition, mergers and acquisition volume, and technology, the act of developing through rapid redeployment has become a profoundly popular topic among senior leaders.

Recruiters spend their days identifying talent ready to assume roles that provide similar or greater responsibility, often finding talent overlooked or neglected by their own organizations.

Because many organizations have managers who fail to develop their talent, or hold back employees ready for more, it makes sense to let recruiters turn their attention inwards, identifying people who can and will assume greater roles externally if not tapped internally soon. (Before you dismiss this case as not applying to your firm, remember that study after study identifies bad managers and lack of challenge/opportunity as the number one and number two reason people leave a job.)

The Critical Goals of Succession Planning

No program can be successful unless everyone involved clearly understands the desired goals and outputs of the program. The six strategic goals of succession planning include:

1. No business problems caused by a lack of leadership/mission critical talent. The goal is to assure the attainment of business goals because the right talent has been identified, rapidly developed and placed in the right job exactly when needed.
2. To identify talent gaps. To identify possible future talent shortages and gaps by comparing “what we have now” to “what we will need.”
3. Identify individuals with potential. To identify the individuals within the organization that have the highest probability of successfully becoming future leaders or key contributors in mission critical roles within the firm. The best plans identify individuals that would not fall in the “immediate vicinity” of the targeted leadership job when viewing the firm’s organizational chart.
4. Speed up development. To define the best series of jobs or “development paths” through the organization that results in the maximum learning and development speed for each of the targeted potential leaders.
5. Minimize leader turnover and frustration. To increase performance and retention rates among developing leaders because of the way they are treated as part of the succession plan.
6. Discourage the hoarding of leadership talent. To set up a series of metrics and rewards that discourage managers from hoarding top talent and instead, speed its development.

Unfortunately Most Succession Plans Are Weak

Succession planning in most organizations is a joke, existing as little more than an organizational chart identifying potential vertical moves into leadership roles. (More often than not, when actual moves do occur, rarely is the plan even consulted.)

People noted on the plan will almost always go through a leadership development program designed and delivered by corporate trainers that may or may not involve some simulation or case study work. This type of program is common, often coordinated in an ad-hoc way, rarely produces world-class results, and most certainly does not live up to the evolving expectations of senior leaders in leading-edge companies.

Succession planning programs under-perform because they are not designed or managed as systems. A system takes inputs, runs them through a series of processes, and produces a predicted output.

One of the best ways to design a succession plan (or any strategic HR process) is to begin the design process starting at the backend, identifying each of the desirable outputs of the process. Generally, there is an output or success measure for each of the stated program goals. The logic behind this “backward” process is simple: you need to design your succession planning program and its key elements not in isolation, but instead by tying program features directly to the desired program outputs.

By clearly defining the desirable outputs, you let everyone know the key purposes of the process, as well as how success will be measured.

Checklist for Assessing Your Succession Plan Using Metrics

Succession plan effectiveness measures can be broken into two basic parts and five groups. The first part covers usage and design, while the second part covers output or success measures.

Part A Operational Measures

Group 1 — Usage factors:
The target audiences for a succession plan are those managers who are responsible for making promotion and lateral transfer decisions for leadership jobs that are covered by the plan. A succession plan can’t be successful if it’s not distributed, read, and actually utilized by managers who make such decisions. Some manager-usage metrics to consider include:

• It is a written plan (if a plan isn’t written, it can’t be distributed).
• Percentage of the target managers who have received a copy of the plan.
• Percentage of targeted managers who have actually read the plan.
• Average satisfaction rate among users. (Low satisfaction rates can lead to low usage among hiring managers. Low satisfaction among plan employees can lead to having other employees be reluctant to be placed on the plan.)
• Percentage of managers actually using the plan for “movement” decisions (the plan cannot be considered successful unless it is actually used by most managers to determine which individual should be promoted or transferred into a particular leadership position).
• Percentage of all movement decisions in which the plan was utilized (this is similar to the last measure, except it covers the percentage of movement decisions in which the plan was used as a guide).

Group 2 — Assessing whether your plan contains key design features:

You automatically limit the capabilities of any succession plan when you omit some of the essential design features mentioned here:

• Focuses not only on promotions but also on progression and movement for development purposes (calling it a “progression plan” is more appropriate because some movement options in the plan should include stretch project assignments, lateral transfers, and job rotations).
• Each participant has a written individualized development, challenge, and learning plan. (Individual plans allow the employee to self-guide their own progress).
• Uses multiple sources in selecting individuals for inclusion in the plan. (This increases the likelihood that a “less obvious” candidate will be included in the plan).
• People on the plan are told they are on it. This transparency also allows excluded individuals to challenge their omission.
• The plan provides direct rewards and recognizes managers who support the plan. Rewards and promotions for managers should be based on their record of successfully developing individuals that are eventually included on the plan. Managers should also be rewarded for having their current direct reports placed on the plan, as well as for periodically releasing and not “hoarding” their employees on the plan.
• The plan includes an element to “retain” and improve individuals who remain on the plan but who have not been periodically moved or promoted.
• It includes a “Right Job” movement element. (Right Job movement means that the plan not only speeds up the movement into jobs but it also ensures that the position includes the appropriate or “right” elements that fit the candidates development needs (i.e., right manager, right motivators, right time, right team, etc.)
• It includes external candidates to spur competition (having external candidates included in the succession plan can put pressure on developing employees to improve beyond normal expectations).

This concludes part one of this series. In the next part, the focus will shift away from metrics relating to program operations to more strategic measures of succession planning output or success.

While you might have heard speculation to the contrary, they continue to innovate, particularly in the area of employment branding, where they maintain global dominance. Several years ago, I wrote a broad case study on Google recruiting that highlighted its overall approach, but I didn’t go into any depth about the company’s bold approaches in the area of college recruiting.

In this article, I’ll highlight some of the creative things that Google has tried in college recruiting, including its latest triumph, the amazing Google College Ambassador Program. (If you missed the original case study, or would like to revisit it, you can find it here.)

The King of Employment Branding

The recent collapse of the banking and financial markets has subdued much of the consulting and investment banking competition that Google once faced on campuses. Despite some turbulence, the high-tech industry is still a shining light in this economy, and Google is by far most students’ number-one choice of employers among high-tech firms.

Recent research reveals that 45% of engineering students would like to work at Google. Even outside of high-tech, Google’s employment brand still shines. It was recently selected as the number-one ideal employer among all undergraduate students by Universum. In their most recent study, 17% of the students participating selected Google, up from 13% last year. Those leads will undoubtedly be lengthened next year following the implementation of their new and innovative College Ambassador Program.

The Google College Ambassador Program

The number-one weakness of all college recruiting programs is their inability to maintain a “continuous presence” on campuses throughout the academic year. Every firm is forced by travel expenses and a finite supply of recruiters to limit the number of days they can have a recruiter on any particular campus.

Because of the cost, recruiters typically fly in, spend a few days, and then fly out. As a result of this “here today gone tomorrow” approach, some college recruiters have even been labeled “seagulls” because they are viewed as “flying in frequently, dropping a load of crap, and then leaving.”

Even Google has realized that it cannot afford to park its recruiting staff on every key campus for enough days during the year to really make a difference. As a result, they developed an “on-campus ambassador” program that I predict will soon be copied by many other major firms.

The premise is simple. Instead of periodically flying in representatives, why not recruit individuals who are already there (students) and convert them into ambassadors?

These on-campus ambassadors or representatives can then act on the firm’s behalf every day they are on campus. They can put together events and generally help spread the word about Google as a great place to work.

Some of the benefits of this “ambassador” approach include:

• Credibility. Because ambassadors are students themselves, what they say is more credible and believable to other students. This allows them to effectively spread both goodwill and recruiting- and product-related information.
• Knowledge of the campus. Because they have been enrolled at the school for years, they know the school’s culture and the best communication mechanisms.
• Enthusiasm. By recruiting enthusiastic students, the firm has an opportunity to take advantage of their energy, enthusiasm, and extensive social networks. Obviously, this enthusiasm could be picked up by other students and it would likely spill over to their work representing Google.
• Low-cost. Because the Google product and employment brand are so strong, students are willing to volunteer their time just for the opportunity to work with Google. Ambassadors will be given a small budget for expenses, communications, and events that they must operate within. They also get to share in the free food at Google events or what Google provides during exams. They also get free Google gear, numerous contacts at Google, and an opportunity to put “serving in a leadership role” for Google on their resume.
• Relationship building. Because they already regularly interact with faculty, presidents of student organizations, and other students, these “reps” can quickly build relationships and influence others far better than any time-crunched recruiter.
• Educating Googlers. These campus ambassadors also serve as a direct point of contact for Google teams. In their liaison role, ambassadors can advise Google employees and recruiters about their unique campus culture and the interests and needs of their fellow students, which are of course, different at every campus.

The program gives the firm an expanded campus presence and an immediate competitive advantage over Yahoo!, Microsoft, Facebook, and IBM (though QUALCOMM pioneered this concept).

I predict the program will get thousands of applicants and it will significantly further Google’s lead in building its college employment and product brands, but only time will tell.

16 Other Google College Recruiting Innovations

Google’s College Ambassador Program is just the latest in a string of what can only be called “bold and outside the box” approaches that Google has utilized over the years. College recruiting is a field that can be characterized as almost universally bland and one dominated by a “follow the leader” strategy.

Google stands out because it uses an array of tools and approaches, including:

1. Google games. Google is famous for holding competitions between noted schools (including Stanford, Berkeley, MIT, and Harvard). Often these competitions include Lego games because Google’s founders are fond of them because they once used Lego bricks as the external expandable casing for one of their early hard drives. Even today, they can be found all around the Googleplex.
2. Billboards. Google used highway billboards that included a math “brain teaser” to excite and eventually recruit math majors.
3. Contests. Google is clearly the #1 firm in using external contests to get ideas and to recruit and assess potential candidates. Their worldwide “CodeJams” are PR magnets as well as being extremely successful candidate and idea generators. Other Google contests have included Google Space, Android, and its famous “Summer of Code” which received over 7,000 applicants this year.
4. Focus on high school students. The best college recruiting starts early in order to capture the loyalty of young minds before other firms have a chance. Google’s “Highly Open Participation Contest” demonstrated Google’s support for the “open source” concept. It also received extensive PR and it successfully involved over 400 high school students this year.
5. Pizza during exams. Google championed the concept of giving free food and pizza at major universities during final exams. The message to students is clear: “we think like you and we understand your needs, so here is free food when you need it the most.”
6. Green recruiting. Google is committed to its green employer brand and demonstrates its deep commitment to sustainability (i.e., solar panels on its headquarter’s roof, its free WiFi shuttles, free bike repair, its subsidy of employee-purchased hybrids, its focus on electric cars).
7. A fun place to work. It’s easy to find stories on the Internet about Google’s “fun” practices. They include free food, pajama day, movie day, martini blowouts, bring your dog to work, and most important, its “20% free time.” Google even made fun of the ubiquitous “aptitude tests” that all college students have to endure when it developed GLAT. Which is a humorous takeoff on aptitude tests put together by Google Labs. Their “testing on the toilet” even makes on the job learning stand out from the traditional.
8. The value of top talent. Google leads the way in “Topgrading,” the practice of trying to hire 100% “A” players. This focus is partially driven by their bold move in quantifying the value of recruiting and retaining top talent (one top-notch engineer is worth “300 times or more” than the average).
9. CEO and founder talks at campus events. Google is among the handful of firms that have calculated the recruiting value of having senior executive speak on campus. Google also encourages employees to give talks at student professional organizations and to bring real Google problems into the classroom (a Google manager visits my management class each semester).
10. Practical training classes on-campus. Google has designed and supported actual courses related to “cloud computing” that become part of the curriculum offerings in order to educate as well as to attract and assess college students (Internet scale program).
11. Blogs. Google excels at encouraging its employees to blog. These blogs make learning and asking questions about Google products and recruiting much easier.
12. Videos for recruiting. Google has created some of the most powerful and most watched recruiting videos.
13. Faculty relationships. Google hires a large number of PhDs (on the premise that they enjoy exploring areas that no one else has explored). To accomplish this, they have developed a network of direct relationships with several hundred professors at major schools.
14. Campus buildings. Google placed buildings and staff on or near college campuses (i.e., Michigan and ASU) to improve their campus visibility. This “expensive to copy” practice also provides both students and faculty with the opportunity to work directly with Googlers and on Google projects during the regular school year.
15. Friends of Google. This tool creates an electronic email network of people who are interested in Google and its products (but not necessarily interested in working for the company). By signing up these individuals and then periodically sending them emails about the firm’s products and events, Google can build a relationship with thousands of people.
16. Internships. Google has an outstanding internship program that hires hundreds of interns each year. The program has an excellent conversion rate to permanent hires. Interns in Mountain View can hang around with Google co-founders Larry Page and Sergey Brin during the company’s regular Friday evening fireside chats. They can also participate in bowling nights, scavenger hunts in San Francisco, ice cream socials, and bay cruises. Interns also get to hear free on-site talks by various business and Internet icons.

Still Room for Improvement

Eventually, even Google’s vaunted recruiting machine will be challenged by Facebook or some other aspiring firm managed by individuals who are also passionate about recruiting. So, if Google is to maintain its dominance, it can’t be complacent.

Instead, it needs to work on some areas that are still weak within college recruiting. Those areas that need improvement include “remote” college recruiting, a formal student referral program, better college metrics, and a more focused approach on new technologies that can be applied to recruiting like social networking, texting, wikis, and video games as recruiting tools.

Final Thoughts

If you think fancier posters, glossier brochures, or better pizza at information sessions will work, think again. These approaches are “so last year,” and only a few firms (E&Y, Enterprise, Qualcomm, and Intuit come to mind) have even attempted to move beyond the traditional into more exciting and productive strategies and approaches to college recruiting.

If you’re not among these elite firms in college recruiting, now is the opportune time to ramp up recruiting on campus because the economy has demoralized the competition. Don’t let the down economy distract you; instead, use Google’s boldness to inspire you to greatness!

A key question in every recruiting manager’s mind these days is “how will recruiting and talent management be impacted by the economic downturn?”

In fact, it will also be a major topic at next week’s ERE Expo in Hollywood Beach, Florida. If you can’t wait till then, this article will highlight some issues to anticipate and action steps you can take that will increase the probability of your survival and perhaps even prosperity during these tough economic times.

If you are a regular reader of my articles, you know that I warned of the upcoming downturn as early as August 2007. However, if you missed that “heads up” and have been in recruiting for more than a few years, you already realize that there are periodic economic downturns. These downturns quite often negatively impact the recruiting function through hiring freezes and dramatic budget cuts in recruiting as organizations seek to “contain costs.”

However, this economic downturn is different. Traditionally, when the economic cycle peaks and starts its cycle downwards, everything related to business and recruiting declines; events are consistent and relatively predictable.

Instead of recruiting heading straight down, it will be volatile. The demand for talent management services will go radically down, then back up again in short spurts, and then down again. This volatility will require more planning than ever before from the recruiting function.

Instead of planning for one consistent, long, downward spiral with associated layoffs and hiring freezes, organizations will need to prepare for spurts of growth and continuous hiring in some areas while layoffs occur in others. Some might call these actions “right-sizing” the workforce, but that would imply that organizations are much better at forecasting and workforce planning than most actually are.

There are several reasons why hiring will continue:

• The volatility in credit markets
• Globalization
• The need by organizations to continually innovate

The first and perhaps most important cause of volatility will be the chaotic availability of credit and capital. The continued uncertainty related to financial markets will cause oscillations or “spurts” during which capital will be easier and then harder to get. This volatility will cause firms to grow and to hire in spurts.

A second cause of volatility is globalization. In a truly global business world, there will almost always be some degree of economic growth in emerging economies scattered around the world. Because many major US companies now book a majority of their revenues abroad, pressure to keep corporate functions fully staffed will continue despite possible layoffs in production and client service groups.

A third reason volatility will plague the recruiting function is relentless consumer demand for new innovative products. Despite the downturn, consumer demand remains high. When negative news erupts, those in Western societies go shopping!

Because the rate of innovation among competitive firms is unlikely to slow down, firms will still need to rapidly innovate in their products and business processes.

The demand for relentless innovation will continuously alter the skills needed by a firm at any particular point in time. Firms will need to learn how to continuously hire workers with new skills, while simultaneously releasing workers with obsolete skills with surgical precision. Truly strategic firms see economic downturns as an opportunity, in part because it’s now faster and cheaper to “buy” talent rather than to “develop” existing talent.

The Top 10 Advantages of Recruiting During Tough Times

It’s quite common during periods of economic turmoil for CFOs to assume and declare that robust recruiting functions will not be necessary due to a surplus of talent becoming available as more and more firms engage in layoffs, consolidations, and the ceasing of operations.

Well-known and respected firms like Deloitte have already partially downsized recruiting using this failed logic. Despite this negative perspective, there are some positive things that routinely happen during bad economic times:

1. Less competition from other firms. If your firm isn’t well known or doesn’t have a strong employment brand, you will face less head-to-head competition for talent during this time. As other firms reduce recruiting budgets, the recruiting effectiveness of your competitors will decrease dramatically also, giving your firm a competitive advantage. Candidates will be easier to sell because they will have fewer options and counter offers to choose from.
2. More high quality candidates will be available. Not only are more candidates available during times of high unemployment, but higher-quality candidates are also available. Not only will laid off individuals be on the market but you should also target individuals that “survived” the layoffs and mergers because they will have reduced company loyalty as a result of all of the trauma. Taken together this means that innovators and top-performing individuals that could never be “drawn away” from their current jobs are now available and interested in lesser known firms. This surplus along with little competition makes “counter cycle” recruiting a great strategy for “loading up” with great talent, especially in the college market.
3. Weakened employment brands. As competitor firms make the mistake of conducting large-scale “public” layoffs, their employment brand and external image will be dramatically weakened. Thus providing increased opportunities for firms that have maintained or intelligently strengthened their employment brand during this period.
4. Turnover and retirement rates will decrease. As the downturn increases your employees desire for job security, fewer will even consider leaving their current jobs for firms where their lack of tenure will mean little security. This means that it’ll be easier to retain your top talent (and recruiting won’t have to work so hard to find replacements). Conversely, it will be more difficult to draw away top talent working at other firms. The downturn in the stock market and the dramatic reduction in the value of their 401(k)’s will also mean that fewer of your employees will opt to retire as soon as they are eligible, easing any baby boom retirement concerns.
5. Higher quality recruiters will be available. Tough times means that some excellent recruiters will be available for those firms planning for the long-term.
6. The dollar is stronger. The newly strengthened U.S. dollar makes recruiting international candidates much easier.
7. New recruiting technology is available. The availability of social networking and other web-based technologies now makes effective recruiting possible with little or no budget.
8. Capability to explode out of the box. If you successfully defend your recruiting budget, your firm will have the capability of “exploding out of the box” immediately after the downturn is over. This capability will put you far ahead of other firms that have decimated their recruiting capabilities during this time. In order to have that advantage, you will need to calculate and then report the negative impacts of “disassembling the recruiting function” to your executives. That includes costs related to the delays in being able to resume hiring, the increased risk of losing top applicants, the lower quality of hires and the increased startup costs related to reassembling the recruiting function.
9. Tight times make you stronger. A tight budget forces you to focus more on metrics and a strong business case. Both of these should allow you to better identify the most effective recruiting tools and approaches. By eliminating the deadwood, streamlining processes and focusing on the best approaches, you will eventually strengthen the function over-all.
10. Workforce planning will be encouraged. While it’s often a “fight” to convince executives to invest in workforce planning, economic volatility and the pain of laying off talent they fought so hard to acquire almost always convinces senior managers of the need for a strong workforce planning function. Use this “lull” to develop an effective forecasting capability and a “flexible” recruiting strategy that “shifts” during the different economic cycles. Both can help you prepare your firm for the next imminent up or down cycle.

Even if you successfully defend your recruiting budget during these volatile times, it’s critical that you focus your resources on talent-management approaches that are both low-cost and effective:

Using Other People’s Resources

• Employee referrals. The key practice for recruiting during economic volatility should be “recruit using other people’s money.” As a result, employee referrals need to be your number-one focus, because they shift a great deal of the recruiting “work” away from recruiters and on to your firm’s employees. Referrals produce high volume and high quality but during tight budget times, the cost of referral bonuses needs to be reduced. Shift to a drawing approach; instead of giving individual cash bonuses, employees get an opportunity to win trips, vacation time, lunch with the CEO, or other non-cash yet compelling prizes. Some firms like Edward Jones have produced over 50% of their hires from referrals without offering any cash incentives; granted, they have a great brand. You can also make customers, employees’ families, suppliers, and consultants who work with your firm eligible for the referral program. Finally, proactively approaching your firm’s top performers individually and asking them for “names” is another effective referral approach to re-emphasize.
• Recruiting at professional events. Recruiting at local and national professional events again “utilizes other people’s money” because the travel and expenses of the attending employee are covered by their business unit. Develop the expectation that each employee attending these events will bring back “three names” of individuals that would be outstanding recruits. Encourage your executives and superstars to speak at these events, because that exposure might result in some immediate candidates, as well as improving your overall employment brand.
• Social networks. There is a high probability that your employees currently utilize one or more social networks (i.e., Facebook, LinkedIn, MySpace) both on and off the job. So why not take advantage of that fact and use it to supplement your recruiting. Start by encouraging your employees to include in their profiles compelling facts and stories about the firm. Next, encourage them to proactively make group connections and to provide you with names of potential recruits.
• Blogs. Many of your top employees probably already write blogs in their technical field. If so, encourage them to talk about the positive aspects of your firm and to actively recruit on their blogs. Encourage other employees that read blogs to use them to also identify top talent.
• Videos. Videos are powerful recruiting tools because they allow you to more effectively “show the passion” at your firm. Consider holding a video contest where employees compete to put together short compelling videos about why your firm is a great place to work. Post the best ones on your own corporate website or on YouTube.

Low-Cost Approaches to Consider

• Boomerangs. The best way to ensure a high-quality hire that perfectly “fits” your culture is to focus on recruiting boomerangs (individuals that previously worked at your firm). During tough economic times, many of these individuals might regret their decision to leave. A simple phone call reassuring them that they would be welcomed back might be all it would take to land proven talent.
• Cut back on full service agency fees and utilize names research firms. It’s always wise to increase the percentage of contingent or contract workers during volatile times. Unfortunately, the agencies that generally provide contingent workers are expensive and their fees are certainly noticeable within a reduced budget. By bringing these services in-house, you can both keep your recruiters busy and maybe even generate a profit by externally “renting out” surplus talent to other firms. Incidentally, if your firm excels at “selling” candidates but needs help in identifying them, now is an excellent time to utilize “research firms” to provide you with the “names” of top talent at competitors. “Names research” firms (i.e., RW Stearns, Technames etc.) provide a relatively inexpensive service when compared to full-service third-party recruiting.
• Utilize interns. College interns are not counted as headcount and are easy to land and many will work for free during tough economic times. They excel at metrics, Internet research, research on best practices, assessing software, and beginning projects that few others are interested in. Focus on HR and management students from local business schools.
• Conduct Google searches. It’s almost impossible for anyone with any professional status to “hide” these days. Key people always have high visibility on the Internet, so utilize low-cost recruiters or interns to identify well-known individuals by running their “Google score.” Names can be found by searching using major technical terms or job titles, along with a firm name.
• Develop a flex plan. Research previous downturns in order to identify whether there are “precursors” within your firm which occur immediately before a growth or cut in recruiting. Also examine the broad industry to see if there are firms which routinely “lead the way” in recruiting related actions. By identifying and tracking these “early mover firms” in recruiting, managers can get a good idea of what will likely happen to you (because your firm has historically been a lagging or follower firm in the industry). Your recruiting plan should also include “labor arbitrage” options that might include geographically shifting the work to where labor is cheaper, outsourcing the work, or replacing work done by people with machines and technology.

10 Recruiting Problems You Might Face During Tough Economic Times

During volatile economic times, some things that used to be easy in recruiting and Talent Management become much more difficult. As a result, it’s important to identify and then focus on these new problem areas:

1. Hiring freezes. One of the first knee-jerk reactions during tough times are company-wide freezes. Although salary, promotion, and budget freezes negatively impact retention, hiring freezes can decimate a recruiting function. Some tips on fighting hiring freezes can be found in my recent article.
2. Stock options are no longer a major motivator. With the stock market constantly going up and down, stock options become less valuable as a motivator both for current employees and for candidates. As a result, you need to shift your sales approach to candidates to emphasize exciting work, flexible work, better benefits, more security, or to focus on cash performance bonuses.
3. Job security is king. Economic volatility makes both employees and candidates nervous about their future. This fear among potential candidates causes them to increase their emphasis on security, which will definitely make “drawing away” the currently employed top performer from their current firm much harder. Recruiting needs to re-examine the information that it provides on job security on its website, in position descriptions and in its offers in order to make it more compelling.
4. An increased volume of traffic. Normally, all great recruiters focus on the employed candidate (the so-called passive candidates). However, layoffs and high unemployment may mean that some high-quality people are now available among the ranks of the unemployed. Unfortunately, if you actively recruit during tough times, the volume of mediocre but enthusiastic unemployed people who will apply for your jobs will also increase dramatically. This high-volume, low-quality flow means that your screeners will be strained and that your selection process has to be more precise to ensure that you don’t mistakenly hire highly enthusiastic people who turn out to be low performers.
5. Relocation issues. Moving people between regions becomes nearly impossible when individuals can’t get new mortgages or sell their existing homes. This problem affects both internal transfers and new hires. Alternatives to consider include focusing on recent college grads who generally rent or consider “narrowing” your recruiting area to a reasonable commuting distance.
6. A loss of trust and confidence. Although your firm might not have been involved, the general mistrust of business that has resulted from the economic turmoil means that both your employees and your candidates will likely now have less trust and confidence in anything that you say. In recruiting, this means that your website must be more objective and believable, your interviews need to be more credible and your offers will need to be stronger, if you expect to convince the cynical.
7. Managers will focus less on recruiting. Few managers have ever really enjoyed recruiting. But their interest in it will likely even decrease further during tough times as the stress from their business workload increases, while their available staff decreases. Their interest in recruiting will decrease because they certainly won’t be doing it as often but also because of the increased frustration that invariably occurs when many of their “active searches” are never be completed because of frequent “surprise” hiring or budget freezes. Their lack of interest in reading resumes and interviews will invariably mean a dramatically slower average “time to fill” at your firm.
8. Layoffs. Although you probably can’t stop layoffs from happening, you should certainly fight to minimize their impact on your employment brand image. Work with PR to ensure that layoffs by your firm don’t become front-page news for potential applicants to see and worry over.
9. Technology budgets. Almost invariably during tight economic times, any budget resources available for buying new technology (ATS systems or new software) are likely to disappear. So either make your purchases immediately or be prepared to live with what you have for a while.
10. Recruiting budget cuts. Almost everyone gets their budget cut during business downturns but there’s no reason for recruiting’s budget to be cut any deeper than others. The key to maintaining your budget is to build a strong business case demonstrating that cutting recruiting has more negative business impacts than the limited cost savings that these cuts generate. Also utilize split samples to demonstrate your impact. When possible, work with powerful executives in growth businesses to get them to “champion” your cause or to directly fund recruiting initiatives that impact their business unit. Also, work with the CFO’s office to quantify the dollar impact of low quality and bad hires, as well as the revenues lost as a result of position vacancies in revenue-generating and revenue impact positions. In finally, focus on winning external recruiting and “Best Place To Work” awards to increase your visibility and credibility among executives.

Final Thoughts

Rather than letting “fear” rule the day, now is the time to anticipate problems and to prioritize your activities in order to maximize your impact.

Volatility in the business also means that recruiting must be flexible and expand its capabilities into areas that increase in importance during tough times. This might mean that recruiters now need to aid in the internal redeployment of employees, in retention, in employment branding, or even helping with layoffs and outplacements. Now is the time to plan ahead and to begin turning “lemons into lemonade.”

The effect of long-term hiring freezes is particularly damaging to the recruiting function, because “no hiring” generally means that a majority of recruiters will be laid off. Historically, budgets for recruiting have been cut so low that the function is literally decimated, making it rather difficult for companies to resurrect a decent function when the economy swings up.

Many executives think that the decision to institute some sort of resource freeze is one that helps the organization because it contains costs; however, the opposite is more often the case.

Poorly thought-out freezes that impact talent acquisition and other talent-management activities may actually harm the organization by:

• Driving increases or vacancies in revenue producing/impacting roles that decrease revenues beyond any cost savings.
• Driving increases in employee burnout/turnover.
• Missing out on new talent opportunities (i.e., not be able to hire a superstar that becomes available).
• Decreasing an organization’s capability/capacity to innovate.
• Damaging the employer brand making hiring more difficult when the economy returns.

Rather than waiting for the inevitable announcement of a freeze, recruiters need to be proactive and preempt any such silliness long before it occurs by making the business case for leveraging this time to re-architect the talent acquisition function, upgrade its strategic programs, and trade up the talent population while salaries and vendor costs can be negotiated down significantly.

(Incidentally, you can tell when a hiring freeze is imminent because they are almost always preceded by the infamous “paper clip memo” from the CFO, which limits the purchase of office supplies, magazine subscriptions, and travel).

Because every organization is unique, there is no one magic way to structure the business case, but I have put together a list of arguments that you can select from:

A) Negative impacts on revenue and costs
Obviously, not expanding your staff or keeping open positions vacant can save payroll dollars in the short term. However, such savings may actually present a false reality because freezes have many other unintended consequences that CFOs often fail to account for:

1. Lost revenue. Across-the-board hiring freezes mean that critical revenue-generating and revenue-impact positions go unfilled. Obviously, when there is no one in a revenue-generating position, there is a lost opportunity to generate revenue every day that the position remains vacant.
2. Customer impacts. Frozen budgets and understaffing can stretch your employees. This means that other employees must now do double duty because replacements can’t be hired. This may also impact quality and send a message to your customers that your firm is slipping as constrained employees sidestep process elements and cut corners. Both can negatively impact your product brand and future sales.
3. A limit on growth. Within most large firms, even during tough times some businesses units are growing, while others are shrinking. By freezing hiring “across the board,” you negatively impact your rapid growth and top revenue generating divisions. This limits their ability to continue to grow. In global firms, some regions are likely to be growing despite the downturn and an overall freeze will threaten your competitive position.
4. Headcount replacements are expensive. In the end, few hiring freezes actually end up saving money because budgeted headcount employees are often just replaced with consultants, temps, interns, and other “off the book” spending. In some cases, these alternative consultants and workers are actually more expensive than regular employees, leading to a situation where overall “labor costs” don’t go down at all. Facing employee shortages, some managers increase the use of overtime in order to get the work done, but at time and a half, this solution is relatively expensive.

B) Retention impacts

1. Frustrated employee turnover. Freezing resources means stagnation, and when opportunities are limited, they are likely to seek employment elsewhere. Freezing pay, promotions, travel, and/or training can also limit employee growth and learning, which will also increase turnover, if not immediately, at the first sign of opportunity.
2. It encourages your competitors. Hiring freezes are visible to outsiders on your website and the news of their existence spreads rapidly. These freezes send a message to your competitors that you are “weak” and struggling. This may cause them to increase their efforts to recruit away your employees and more often than not, your customers.
3. Freezing deadwood. Unfortunately, not being able to fill vacant positions causes managers to slow down or even cease their efforts to get rid of their deadwood employees. “Carrying” these low performers leads to lower productivity overall, but also weakens your managers by not forcing them to confront low performers. It gives managers an excuse not to make tough people decisions, which may also eventually weaken their decision making in product areas also.
4. Freezes frustrate “idle” recruiters. The best recruiters you are able to keep on your staff will invariably get rusty during hiring freezes. Having idle recruiters is a waste of money but it can also foster turnover among your recruiters who love action.

C) Missing out on talent opportunities

1. Exceptional talent. Across-the-board hiring freezes mean that when a few exceptional individuals like “Tiger Woods” enter the talent market, you will not be able to consider them. As a result, you’ll miss out on exceptional talent who could really make an impact. If your firm doesn’t capture this exceptional talent, other firms will.
2. Off-cycle recruiting. During tough economic times, both the amount and the quality of available talent will greatly exceed the available talent during boom times. Because during lean times, few firms are hiring, there is minimal competition. Together this means that a firm can now successfully attract experienced and college hires that their weak employment brand, pay rates or location wouldn’t normally allow.
3. Weakened recruiting capability. Extended hiring freezes invariably weaken the recruiting function. This loss of recruiting capability can impact the business because the remaining recruiting staff won’t have the ability to successfully recruit and land “in demand” candidates for the few positions that do become open.

D) Reduced innovation and technological capability

1. Reduced innovation. Budget freezes in particular can rob your innovators of the resources that they need to innovate, just as hiring freezes prevent you from recruiting new innovators. As a result, the rate of process and product innovation may decrease significantly during hiring freeze. In addition, freezing promotions and pay increases may limit your innovators motivation and willingness to be creative.
2. Impacts on technology. Because technology is constantly evolving and improving, hiring and budget freezes will directly limit your ability to attract new technologists and the needed new technologies.

E) Additional negative impacts of freezes

1. Employment brand impact. It signals a stoppage in a firm’s growth, which can impact your firm’s employment brand as a great place to work. This can make future recruiting more difficult and expensive.
2. Stock price impact. A freeze sends a message to analysts, customers, suppliers, and employees that your firm is not in a growth mode. Long or frequent “pauses” in recruiting may also send a stronger message that the company is in trouble, which could further hurt the stock price, which is likely lower anyway as a result of the weak economy.
3. Recovery time. Hiring freezes often mean that the recruiting function will be decimated. The function cannot be rebuilt overnight after the freezes are lifted. Many managers wrongfully assume that recruiting is a pure production function, one which you can put money into today and get results out tomorrow. While recruiting truly is a production function, it often requires significant ramp-up time, which many organizations fail to plan for. Refilling the “talent pipeline” with candidates after a freeze might take months, which can end up making the freeze last even longer than intended. In addition, “exploding out of the box” when the economy improves will also be more difficult.
4. Excessive early spending. Anticipating freezes often encourages hiring managers to hire “a bunch” of people early (whether they are needed or not). They do this in order to avoid “losing” the positions later in the year when hiring and budget freezes are generally introduced. In the same light, rumors of possible freezes can make managers and HR paranoid and to do “immediate panic” hiring the moment they hear a rumor about an upcoming freeze. They might also make rush decisions during a current hiring process, in order to complete it prior to the institution of a forthcoming hiring freeze.
5. Lower referral rates. Freezes may cause employees to hesitate before making referrals. They are hesitant partly because budget, promotion and pay freezes make the organization a less desirable place to work but also because a freeze may make their efforts fruitless because it diminishes the chances that their referrals will soon be hired.
6. More time spent on administration. Most across-the-board freezes are really not true freezes. Top managers almost always leave “exceptions” open. As a result, they don’t really “stop” hiring, they just slow requisition approvals and make them more painful to get approved. A large amount of a managers (and HR’s) time is wasted “getting around” these freezes and justifying “exceptions.” It can also give managers a bad taste for hiring of any kind, which may result in managers not devoting much time to the hiring process once the regular hiring process returns.

Action Steps

Rather than instituting across-the-board freezes, educate managers about the different options they have for cutting costs and increasing revenues:

• Focus on budget dollars. When it is important to slow down expenditures, it is often better to do it through budget control (controlling dollars) rather than through a hiring freeze or headcount tracking. In addition, always look at the revenue impacts whenever costs are cut.
• Increase internal movement. Managers need to increase the impact of their current employees by developing plans to transfer people internally from low return areas to those with higher return.
• Use incentives. Managers should consider offering short-term incentives to employees for increasing productivity or for reducing costs. Employees are often better equipped to judge where costs can be cut with minimal impact on productivity.
• Prioritize positions. If a manager decides to use a hiring freeze, they should limit the freeze to pre-identified non-key positions. Otherwise, a vacancy in a critical job can cause a significant loss in revenue and negate the projected cost savings from the hiring freeze.
• Demand metrics. If freezes are used, track metrics to determine whether overall costs are actually reduced by the freeze.
• Performance management. Managers should be encouraged to periodically fire low performing employees first, before seeking replacements.
• Rapid growth divisions. These critical regions or business units should be exempt from across-the-board freezes.
• Continuous churn. The new realities of talent management and business are that the old pattern of resource freezes and then layoffs needs to be broken. In a global economy, where firms need to be fast and agile, the new model is for firms to simultaneously hire and release workers in different areas. Smart managers must learn to continually add workers in areas of growth and innovation, while continually redeploying or releasing workers in areas of low ROI.

Final Thoughts

Any review of history will reveal that the majority of wealth in modern civilizations is more often than not created during times of significant economic crisis.

Opportunities abound for those organizations that are truly strategic, but as we all know, lots of people talk about being strategic but few really are. Now is the time for talent management to step up and proactively re-engineer antiquated practices and programs, and to embed talent management activities throughout core business processes while the organization can accommodate change.

If you wait until things are moving fast once again, you won’t have time to be strategic; you’ll be too busy catching up!

For great recruiters, this is an historic opportunity that can’t be missed. The elite of the elite are teetering — firms that have for decades had their way with the best talent from around the globe. If you haven’t already developed a recruiting plan to poach the best individuals and yes, even intact teams, there is no time to waste.

Target Top Performer and Innovator “Survivors” Who Hate Stagnation

The obvious recruiting move would to be to target the thousands of financial professionals and MBAs who are about to lose their jobs. While that is OK, if you want to land a true “find,” my recommendation would be to instead target the “survivors.” Survivors are those top performers and innovators who are almost guaranteed to still have a job because they are so valuable. Normally these extremely high-value individuals would be untouchable by corporate recruiters outside the financial industry. However, for a brief period these top performers and innovators will be considering other opportunities because these individuals have difficulty coping with the frustration that comes with frozen budgets, cost containment, limited risk-taking, and the politics of mergers and acquisitions. These top performers and innovators are so good that they will almost certainly survive any buyout, merger, or even a bankruptcy.

This state of uncertainty and stagnation doesn’t bother most employees because they are just happy to have the security of a job, but top performers and innovators hate stagnation. They want to be “in the competitive game” constantly. They don’t want to take a break from the competition. Take Tiger Woods, as an example. If he was on your golf team but senior managers decided with little notice to play no matches for the next year, what would his reaction be? You could assure him till you were blue in the face that he would have a job and a paycheck, but it would matter little; Tiger wants to play against the best every day.

Great players and great employees want to be competing every day. They want to try new ideas and face new challenges. And that can’t happen in an organization where budgets are frozen and executives are laser-focused on trying to restore stability. Anytime an organization freezes hiring, pay, promotions, or budgets, the loyalty of top performers and innovators shrinks immediately.

Perhaps an example will help to illustrate the point. I know an exceptional top performer who had worked only at great high-tech firms from Intel to Cisco. Eventually, he moved to an emerging firm because it promised him fast decision-making and the opportunity to innovate on the “bleeding edge” of technology. He was energized and excited and he threw himself into the opportunity. But suddenly, with no warning, he abruptly quit one day. I was startled because he was so excited about the opportunities and challenges that he faced. So, I asked him: ‘Why the sudden turnaround in loyalty?’ He said, ‘I had no choice, because they froze all development budgets for the next year.’

Because I work at a university where budget decreases come on a weekly basis, I was puzzled. I asked him why the budget freeze was such a big deal; after all, it wasn’t a cut, only a freeze. He answered without hesitation, ‘I couldn’t stand the thought of not taking risks and innovating for an entire year. The stagnation would kill my spirit!’

He made a year with no budget increases sound like an eternity, but to him it was.

Corporate recruiters are always talking about becoming more strategic, but unfortunately few find the time or develop the courage to take advantage of strategic opportunities when they are presented with them. While the turmoil on Wall Street is a terrible thing, it has presented stable companies with cash in the bank a very rare opportunity. Not only is it a great time to recruit top talent away elite firms, it is also a great time to swoop up smaller- and medium-sized firms that rely on credit to fund operations because credit will be in short supply. Acquiring companies for their talent is not a rare occurrence; unfortunately, it is rarely one proposed by corporate recruiting functions. Truly strategic recruiters should understand the employer pecking order in the labor markets, the business models of talent competitors, and be able to build a short list of “labor investments” that offer great return.

Action Steps for Identifying Top Performers at Troubled Firms

Identifying who you should target to “poach” is easier than you think. Here are some tips on how to do it:

1. Remember: don’t look on layoff lists. Stars will still be employed.
2. Use social networks (Facebook, LinkedIn, Twitter, etc.) to identify individuals from these firms. Ask those who you do identify to help you out by naming others.
3. Search blogs written by employees at target firms for the names of top employees.
4. Ask your own employees and especially new hires if they know any top performers and innovators at your target firms.
5. Use “names” search firms (research firms have ways of identifying these individuals). There are numerous research firms that, for a relatively small fee, will provide you with the names and the contact information of anyone at a target firm if you know their title.
6. Identify famous or well-known individuals by running their “Google score.” Key people always have high Google scores. They can be found by searching for major technical terms or job titles, along with a firm name.
7. Search seminar, association events, and trade show brochures for speakers who come from these key firms. These survivors are likely to be authors and/or speakers.
8. Offer an increased referral bonus (bounty) for the next few months for top-performer referrals from these key firms.
9. Purposely include a representative from key competitors in your interview list for job openings. During the interview tell them that you assess top talent in part by their ability to “name other top talent.” If the same names appear across multiple interviews, you are getting close.
10. Contact former employees at these key firms and ask them for names.
11. Ask suppliers, customers, and consultants who work with your firm for names.
12. Use sites like Jigsaw (which collects business cards) to identify individuals with key job titles at these firms.
13. Use executive search firms that specialize in these industries.

Selling Them on Your Firm

Once you identify the individual, obviously you still have to convince them to make the switch from an unstable firm to a stable one. Some tips that might help you include:

• Put together a portfolio of arguments demonstrating that your firm has the resources