It is hard to believe that it has been nearly 10 years to the day since Free Agent Nation was published, and nearly 14 years since the article by Daniel Pink graced the cover of Fast Company magazine. Since that time, a lot has changed, but given the inflection point we are experiencing with regard to the economy, the job market, accelerating recruitment challenges, as well as changes in recruitment and candidate behaviors, it’s useful to revisit the free agent discussion in light of what has changed (and what has not). keep reading…
We are in interesting times with regards to corporate recruiting. This is a Big Inflection Point in the business cycle (arguably the largest one many of us will experience in our lifetimes) and recruiting departments are really stretched.
Part of the challenge corporate recruiting departments face today are a result of not recognizing “False Economies.” A False Economy is when something seems like a great deal or a good idea, but the economics are not what they seem when viewed more holistically or from a different vantage point. This is usually a result of tension between short-term objectives and long-term objectives: value is typically traded between the two. Jack Welch famously remarked about two years ago that “On the face of it, shareholder value is the dumbest idea in the world …”
That is an interesting insight to reflect upon in light of managing a corporate recruiting operation.
There are a host of potential False Economies in corporate recruiting departments — things that seem like they save money or create value, but in reality the true net economic value is substantially less. Identifying and understanding these False Economies will be imperative for staffing leaders to navigate the rough waters ahead.
One timely example is recruiting team capacity … many organizations currently have an insufficient capacity model for the current demand plan. This typically results in overspending that is far greater than the cost of deploying a more sustainable resource model. At the center of the dilemma is the substantial difference between maximum capacity and optimal capacity. Many corporate recruiting departments have been cut so much that they would need to operate at maximum capacity to meet the needs of the business. This is unsustainable, like running your car at redline all the time: sure you can do it, but how long is it going to last? keep reading…
I’ve been thinking a lot about speed.
Things are starting to loosen up in the talent marketplace. Candidates are now comfortable changing jobs. Jobless claims are dropping, as is the unemployment rate, but there are not a huge amount of new jobs being created (yet). So The Great Churn of 2011 has begun, as employees (including recruiters) start to change companies after having hunkered down for the last three years. And this is putting increased pressure on corporate recruiting departments, most of which have been cut in ways we haven’t before seen. My prediction is that 2011 will be a tough year for most corporate recruiting departments.
Which brings us back to speed. keep reading…
This is the final piece in a 3-part series exploring the negative impacts that social media is having on recruiting departments across the world, and offering strategies and tactics to mitigate this downside exposure for corporate recruiting departments. As always, reading the first two articles is recommended before diving into this one.
In Part I, we explore the Social Gap … the gap in expectations created by the intersection of social media with what is a highly transactional process designed to be reasonably efficient and effective and scalable, at least at most companies. This is primarily a gap of expectations, because most corporate recruiting practices are currently incongruent with supporting the social graph. In part II, we discuss the issues related to Social Proof, and how social media is fueling the reputation economy which places far more pressure on organizations to create candidate marketing impressions that are true.
The third problem that social media creates for recruiting is The Back Door Problem: keep reading…
In Part 1 of this series, I introduce the argument that in addition to the obvious upsides, substantial negative consequences are also created through social media’s impact on recruiting. Social media is creating problems for recruiting, but few people are talking about this topic. keep reading…
Everyone is talking about Social Media and the utility it brings to talent acquisition. However, I don’t often hear dialogue about how social media negatively impacts recruiting. But it is creating (sometimes big) problems that warrant discussion, so I am going to talk about those problems here, and hope that you join in the discussion by commenting. I will also provide some solutions and action steps that smart recruiters and recruiting leaders should consider as we proceed along what is clearly a substantial inflection point in the talent marketplace. keep reading…
I read a lot, and one of my favorite books that I read in 2010 is Blue Ocean Strategy by W. Chan Kim and Renee Mauborgne. I have no relationship to the authors, and no vested interest in whether you buy the book or not, but I recommend that staffing leaders and recruiters read it as part of their New Year’s Resolution. This is one of those books that will make you smarter. It’s actually a few years old, but has become quite a phenomena, being translated into over 40 languages and winning a huge amount of accolades. Like being voted as one of the 40 most influential books in the history of the People’s Republic of China.
It’s worth reading.
The basic premise of the book is that many companies that win in the marketplace do so in ways that make their competition irrelevant. The name of the book comes from two concepts describing the competitive landscape in nearly all industries: Red Oceans represent the fiercely competitive arena where most companies compete. Blue Oceans are open and not filled with competitors — uncontested market space in other words, which help drive margins and market share while receding competitors remain in Red Oceans competing on price, value, and other replicable product or service traits.
The concept is the result of a decade-long study of 150 strategic moves spanning more than 30 industries over 100 years (1880-2000). In simple terms, the goal of Blue Ocean strategy is to not outperform your competition in a particular industry, but to create a new market: a Blue Ocean.
There are a lot of predictions flying around about what will come in 2011 as it relates to recruitment. And I recommend that we all heed the probable changes that are likely to arrive as 2011 will surely mark an inflection point on what has been a relatively stagnant period in terms of human capital management and recruitment. But it’s not just ‘getting ready to do more of the same that will allow your company to win in the marketplace for talent. The truly game-changing strategies are the ones that will lead your company out of the spaces where most companies compete for talent and into the Blue Ocean of less (or un) contested market spaces for talent.
Here are some thoughts on how smart companies will arrive at a Blue Ocean with regard to the talent for which they compete. keep reading…
I was talking last week with Melissa Mounce, the senior vice president of talent acquisition at PNC who I’m interviewing for a session at the Spring ERE conference, and it reminded me of a topic that is worth revisiting: The Law of Compensating Behavior and how it has changed talent acquisition. I will get to Melissa’s insights in a moment.
Now, most don’t refer to compensating behavior as “a law,” but since it’s rooted in human behavior related to incentives, and incentive drives behavior, I submit it’s far more of a truth than a theory and plays out in broad-based ways in many areas of life (including recruiting) beyond just those that have been studied or measured.
Regardless, it is far more useful to consider it a law than a theory when making decisions. That aside, in simple terms the theory goes like this: when variables are changed, human beings often unconsciously alter their behavior in order to compensate for the change. Hiring managers have done this as a result of changes in the way most companies recruit. keep reading…
In Part One and Part Two of this series, I discussed the importance of taking a systems approach to developing a recruiting team through training initiatives in order to avoid suboptimal training results. I reviewed the five key areas that staffing leaders should evaluate and consider before implementing training initiatives:
- Evaluating Recruiting Department Capacity
- Implementing Effective Incentives
- Understanding Motivational Factors
- Optimizing Feedback and Communication Systems
- Evaluating Environmental Factors
These factors underpin the theory most commonly associated with Human Performance Technology; taking a systems approach to organizational performance is always required if the business outputs are likely to be materially changed. Yet very few recruiting organizations approach training this way … most often training is delivered as a “we have to do something to develop the team” without a lot of thought or true understanding of how to engage the system that is the recruiting supply chain to create improved outputs such as faster cycle time, lower cost, or improved quality. Every recruiting leader should read Lean Thinking by Womack to challenge what is widespread conventional wisdom on batch processing and workflows as further evidence supporting the need for a systems-based solution.
So, assuming that the five factors described above are duly evaluated and are optimized at least to a modest degree, here are some considerations related to delivering training and developing a recruiting team to improve results. keep reading…
Given the demands to do more with less that are prevalent in HR and recruiting departments, in Part 1 I discuss how imperative it is to take a systems approach when implementing changes to improve recruiting team yields or other key performance indicators, and discussed two recommendations related to investing recruiter training initiatives: Evaluating both capacity and also incentives, before pulling the trigger on a training initiative.
A common problem is that many organizations make the decision to train their recruiters (and other staff) without evaluating other components that correlate to optimized outcomes. This is a common training error: “we aren’t getting the results we need … therefore let’s train the staff … (and fast).”
There are three more areas that should be considered before implementing recruiter training initiatives: keep reading…
Part 1 of a Series Related to Optimizing Recruiting Team Results
Let me start by saying I am biased with regard to recruiter training. Beyond that bias, though, it is clear that providing development opportunities for people to improve their skills is certainly worthwhile, but in most cases it only holds true provided the training is implemented correctly. But there are countless occasions when I observe recruiter training initiatives deployed incorrectly, so the topic warrants discussion, particularly given that one of the common themes prevalent in today’s workplace environment is cost-containment, and the goal of doing more with less. Indeed, “doing more with less” has probably never been more pressing than in today’s economic climate and is particularly true of human resources and talent acquisition departments across most companies. keep reading…
One of the key structural changes in the talent economy is directly tied one of the key structural changes in the American economy: the mobility of candidates, which has been encumbered in two ways.
One, the most obvious, is that with more than 11 million homeowners in America owing more than their home is worth, that portion of the workforce is simply not mobile. When combined with homeowners who have near zero equity, that equates to roughly 29% of all mortgage debt being underwater; in rough numbers, 29% of potential candidates will find it very difficult to move in order to change jobs.
Remember, selling a house costs nearly 10% of its value, when you add tax, real estate fees, and other related expenses. Owning with no equity is like renting with no mobility. This drag on candidate mobility up to now has been at least partially masked by continued elevated unemployment and low demand for talent, but the issue is in large part structural until the housing market works through what will prove to be a long recovery process. Importantly, long before housing prices recover, companies will be hiring again, yet nearly a third of the talent pool will be mired with a home they are unable to sell without substantial financial assistance. As a result, candidate relocations are at an all-time low.
Negotiating Yourself Out of the Corner You Talked Yourself Into. Part III of III (Living "La Vita Negotiator")
I hope in reading this final section on negotiations I can assist you in achieving a better understanding of the steps and processes needed to become a truly effective negotiator. More importantly, through the application of these steps, I hope to assist you in becoming more successful in your business dealings, and as a result, assist you in making more money. (Hah - you've been negotiated!). A bad negotiator would have would have begun the article by stating, "If you do not read this you are nuts!" Now, that might well be true, but that will no longer matter now that I have challenged you to prove me wrong. A good negotiator always leads people to their way of thinking, not dragging them there. So, how do you become a better negotiator? Step #1: Establish trust and respect on the first contact. It is too late by the second contact. If the first impression you make is a bad one, then you have to work on that before you bother with any of the other steps. If you come on "strong" (a la used car salesman), tone it down. I recommend you practice simple politeness and courtesy in your everyday life to "train" yourself to have empathy. Open doors for other people, nod your head and smile at people as they walk by your office or cube. When driving, let other cars in traffic, slow down and wave people into the spot in front of you. If you are going to your car in a crowded parking lot, wave a car over to you before you get in your own car. Why? Because empathy is the best tool you have as a negotiator. The ability to sense need in others and developing a natural and flowing response to that need. That is not a switch you flick on and off. It is a very real part of your everyday life. Can you negotiate without empathy - sure. Will you ever be a great negotiator without empathy - no. People sense empathy, they sense genuine concern. We all say we can spot a "jerk" a mile away. So can candidates. If you find this tough to swallow, think of the rudest person you know and the politest person you know. Who would you rather have as a negotiator for something you truly wanted? If you still do not equate successful negotiations with politeness consider this, would you rather cut off the next car you see, or increase your income by 25%. Believe me, if your answer was the former, you are a bad negotiator. Because there is no money to be made in professional sales through rudeness. Besides, in a world of better negotiators, driving would be less stressful for all of us and I could finally find a parking space Step #2: To negotiate effectively, never be "them," always be apart. Whether you are an agency recruiter, a company human resources representative or a consultant, always refer to the hiring authority as "them." Maintain your status as the third party in the process. Even if you have final authority in the offer process, do not boast or brag about it. This allows you to create delays and pauses in the process to rethink or seek guidance. It also permits you to give "another point of view" without being seen as a person with a "stake" in the outcome. Agency recruiters can diffuse their vested interest by saying, "You may think all I care about is my fee, but I also care about my reputation with this client. I do not profit from a bad hire." A company representative can also separate themselves by saying, "I do not get paid by the hire. But, I am judged by my retention record. I have no interest in making a bad hire." By the way, refer to Step #1, if you say this, you better mean this, and you better be convincing. This only works if it is the truth, and believed. (How's that polite driving coming along?) Step #3: Plan, plan, plan and then plan some more. You should have been taking notes on every positive and negative comment the candidate has made about their current job and every positive and negative comment they have made about the opportunity you represent. In the negotiations, they will only mention the negatives in your opportunity and the positives in their current job. You, therefore, must be prepared to remind them of the negatives in their current job and the positives in the opportunity you represent. (Note: The candidate currently has a "job," you represent an "opportunity." Good negotiators are good subliminal "word-smiths." (Every word is "chosen" for a reason.) In the first installment I mention the car salesman trying to close a deal. Is the new car buyer driving an old car, or merely buying up in response to a recent promotion. To a negotiator this means when they are closing the deal with an old car owner they should mention, "I would hate to have the engine finally go in the middle of nowhere!" If the buyer is "upgrading" then a good negotiator would say, "I know what you mean, you have earned a car like this." In both instances the negotiator reminded the buyer of their own motivations. The negotiator did so by placing themselves in the moment ("I would hate?", "I know what you mean?"). If the buyer's previous comment had been concern over cost, you could have "argued dollars" and lost, or "reminded" the buyer of other issues to balance the cost. In salary negotiations you cannot always count on finding extra budget money, so you better have the "other" reasons ready. For example, "I realize you had hoped for a bigger increase, but you also wanted a better bonus program, and that's in this package. Aren't you better off in the long term?" You agree that something is lacking "in part," but you are also reminding the candidate of "the greater whole." You are posing the question, "aren't you better off?" in a question that you already know the answer to: "Yes!" But to use the "buyer's" own words, you had to be quiet and listen. Then, plan all the potential counter-points based on that knowledge. The candidate currently has to drive 45 minutes to their job and hates it. The new opportunity is only 30 minutes away. In real estate it is "location, location, location." In negotiations, it is "plan, plan, plan." Step #4: Good negotiators always leave a door open. We're natural fire marshals. Listen to the way you speak to people. I mean listen, not merely poised waiting for a gap to jump into like a family dinner. Good negotiators teach and explain as they speak. Do you? A good negotiator avoids sentences that do not allow you to change or alter direction. "I feel that the offer they are preparing to make is a fair and honest one." The negotiator "feels" it is a good offer, they are not insisting that it is. Therefore they have not declared a position from which they must stand or die. The negotiator has remained a third party by use of the word "they" and has left the door open for possible discussion by referring to the offer as "are preparing" and not "done." The negotiator has inferred that the offer is "fair and honest," they did not say "generous." The candidate can disagree with the latter, but, even if not happy with the offer, they would not be inclined to say it was not "fair and honest." If it is "fair and honest," on what grounds do they base their need for a bigger number? They will have one, but if you were listening, and if you planned, you are ready for their next point, with your counter point. If you notice, the sentence in the above example was polite, it educated and it pointed in a direction. It was not confrontational, and it did not insist. It is my opinion that true negotiators make an effort in, every communication, to practice the art and process of leading people to their way of thinking and not "pushing them" there. (See, I "negotiated" you again. Hah!) Step #5: Negotiators never take it personally. If things are not going well, you are concerned but never upset. "I am sorry you feel that the offer is lacking, I know they will be disappointed to hear that." This will evoke a response, you can always keep negotiations going as long as the other person "responds" to your comments. Your open comments. If you "hit them" with anger, they will close up, "This is not the kind of answer I was expecting." Well, they do not care what you were expecting, they were expecting something as well. Good negotiators have the heart of a champion "ping pong" player. They keep the ball bouncing, no matter what: Candidate: "I know, I am sorry too, but I cannot accept an offer less than 50K."
Negotiator: "May I ask why 50K is a goal, maybe I will understand your position better?" (Supportive, seeking guidance and understanding.)
Candidate: "My roommate in college is making 50K, and I am at least as bright as he is!"
Negotiator:"If my roommate told me that, I would ask for the pay stub. He used to lie like a rug." (Humor can be a diffusing tool. You create doubt without confrontation)
Candidate: "Yah, but I know they need this position filled, and I am only looking for X more."
Negotiator: "I see your point, but I would also hate to see you lose this over that slight an amount. (Use the candidate's own logic to support your counter-point)
Negotiator: "Plus, I cannot say that you are the only potential candidate. Like you say, this is a tough market. The client feels they have found their candidate in you, but they also have to be prepared in the event you decline." (Inject doubt, but not by diminishing the candidate, or the client's preference for them. This is presented and phrased as a "concern" on your part, based on your knowledge of "the client.")
The important thing is to always keep the dialogue going. But going in the direction you want through helpful and gentle nudges. Never shove. Step #6: Negotiators keep trying to "close the deal." Every time you make a counter-point, do not wait for the candidate to conclude the negotiations. That's your job, you?re the negotiator: "So, if the over-all package exceeds your original goal, that makes this a good deal for you. I suggest we call the client now and make their day, too." You are "recommending" and indicating a good deal for both parties at the end of the sentence by inferring "If the candidate objects, not a problem, the negotiations continue. The only time you fail in sales when you conclude the process without a closed deal. We do not keep count of how many previous times you failed to close the candidate, just the final time you failed. In sales, you can always go for the close as many times as it takes. To quote a baseball great, "It ain't over, till it's over." There is no "secret" to successful negotiations. But there are roadblocks. If you are not a good person in the way you deal with co-workers and candidates on a daily basis, you will fail as a negotiator. If you are prone to not listen to other people, you will fail to negotiate effectively because you lack the tools you need to negotiate. If you use closed sentences that do not allow you to re-channel and re-direct the flow of the conversation, you will never get to the point where you can try to close the candidate, the goal of negotiations. In essence, the steps in negotiations vary from situation to situation, from person to person. But the one principle that is a constant is that you will never succeed in dealing with people who do not like or trust you. So be nice, be honest, and get rich. So live "La Vita Negotiator" Have a great day recruiting!