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You would have to be clueless to not be aware of the turmoil on Wall Street these days. Banks, investment firms, insurance companies, and nearly every type of financial services institution is facing severe budget cuts, layoffs, and bankruptcy. This kind of turmoil makes even the very best employees rethink their current employment situation. When people question their future with a firm, it provides an opening for corporate recruiters at stable firms to proactively raid Wall Street and to “cherry pick” the very best away from firms that in the past were literally impossible for most recruiters to crack.

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.

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Microsoft has a clever strategy to recruit away Yahoo! employees. For the most part, Microsoft has successfully relied on its strong employment brand and near-boundless opportunities to attract the best and brightest as opposed to seeking them out.

That is, until recently, when Microsoft raised the level of its recruiting aggressiveness to the point where it would have to be rated an “A” on the aggressiveness scale.

The first indication came prior to the initial merger offer to Yahoo, when its central sourcing team directly emailed recruiting messages to Yahoo engineers, playing on their concerns about Yahoo’s future. Just last week, they ran a full-page color ad in the paper announcing in bold type…“Microsoft has search jobs in the valley”.

There is no secret who the ad was intended for, despite daily defections from Yahoo there is still some top-notch talent inside the company that the competition would love to poach. No subtlety here!

Develop Talent, Hire Talent, or Buy the Competition

In nearly every industry, talent is the primary driver of both a firm’s capability and its capacity to perform. For firms that are growing, either holistically or through industry consolidation/expansion, there are really only three options to ensure access to talent.

Some companies opt to build or develop talent; unfortunately, development is often a “slow” option that provides mediocre results in a fast-changing world.

A second option, growth through mergers and acquisitions, allows the firm to increase its capabilities relatively rapidly as a result of “buying” or merging with a major competitor. It is one of the most common and fundamentally sound business strategies available, and one in constant use around the world. However, M&A is expensive, and often leads to defections of the very key talent you have liked to have retained. Mergers and acquisitions can be hostile or tame, something we have witnessed with Microsoft’s attempt to acquire in recent months.

When M&A doesn’t work, companies have yet another option, one that is less complex, less time-consuming, and much less expensive. This option is to poach away most, if not all, of the talent that provides the competition with its capacity to exist, something Microsoft is obviously doing in a very public way.

The “Neutron Bomb” Recruiting Approach as an Alternative to Mergers

The “Plan B” poaching strategy that firms should consider a feasible alternative to mergers and acquisitions focuses on using strong recruiting approaches to directly “poach away” the target firm’s key employees. This effectively gives you access to all of the capability that produced their intellectual capital without the internal drama that led to the competitor’s chaotic state.

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By Dr. John Sullivan and Master Burnett

As the global war for talent continues to manifest itself in an ever-increasing manner of ways, a nasty practice left over from an era long ago continues to handcuff recruiting organizations around the world. The practice we speak of is the gentlemen’s agreement made between two organizations not to poach one another’s employees.

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Ever since the unsolicited offer by Microsoft to buy Yahoo, recruiters have been literally “circling” Yahoo in a manner that would have to be labeled as aggressive even by Silicon Valley standards. The tactics vary from the relatively tame practice of “cold calling” into Yahoo in order to find nervous employees to the more aggressive “trolling” by recruiters outside Yahoo’s parking lot and in local spots where Yahoo employees hang out.

Even though Microsoft hopes to gain a significant amount of Yahoo’s talent through acquisition, a number of groups at Microsoft are not waiting. Already on the Internet you can find copies of emails sent by Microsoft recruiters to known top talent at Yahoo, offering them an opportunity to explore a Microsoft career in this time of uncertainty. Those interested in reading one such email can check out this blog posting.

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If you are a fierce competitor who wants to practice competitive advantage recruiting, this second part of the article will continue to discuss action steps to take to identify and then counter your competitors’ recruiting actions.

Part 1 in this series introduced the initial three steps for building a competitive advantage in recruiting, which included applying counterycyclical hiring, learning to hire when they’re not hiring, and providing competitive job descriptions. This week, here are 14 more steps to take when building your competitive advantage:

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Business is all about head-to-head competition. Firms regularly compete for a limited supply of customers by designing products to outstage the competition, pricing products to undercut the competition, distributing products as close as possible to the customer, and branding them to drive loyalty over time.

In each competitive arena, leading companies strive to develop a competitive advantage. In the marketing and sales departments of major firms, the business environment is clearly understood: it’s a fierce competition of us against them, not just today but everyday.

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Few topics in the field of recruiting evoke such strong opinions as the subject of poaching talent, but it is a topic that must be explored further. In the United States, it is clear that a number of corporate recruiters shy away from poaching talent on the grounds that it is unethical to approach and offer possible employment to someone who is already gainfully employed by another organization, such as a direct competitor, despite the fact that the target employee could always just ignore the recruiter’s efforts or opt out at any stage in the process. Given that firms in the United States are typically the most aggressive recruiting organizations, having pillaged other countries for top talent in information technology, healthcare, and the sciences for years, you might assume that the dominant perceptions around poaching talent in the Unites States are similar to those of recruiters abroad. If you did do that, you’d be wrong!

U.S. Perceptions Exist in a Vacuum Two weeks ago, I spoke at ERE’s first European conference, to a crowd of recruiters representing some of Europe’s most recognized companies and a handful of U.S. companies with a strong global footprint. I opted to speak on what I consider the most aggressive recruiting tactic available to corporate recruiters: targeted talent poaching. Prior to arriving in Brussels, Belgium, I prepared for a negative reaction, based on previous experiences with this topic in the U.S. But to my surprise, the reaction wasn’t negative. In fact, one member of the audience spoke up and indicated that poaching had become par for the course, a comment that drew affirmation from the rest of the audience. This caught me by surprise, only because over the years I have worked with a number of European firms, and when compared to firms headquartered elsewhere, their hesitation to adopt aggressive approaches was by far the most resolute I’ve experienced anywhere in the world.

Reflecting on that experience, I realized that it wasn’t out of line with other global experiences I’ve had this year. Throughout 2005, I touched down in eleven countries, mostly in Southeast Asia and Central and Eastern Europe. The perceptions around poaching encountered in Europe could be seen in Australia and New Zealand, where the shortage of skilled talent has threatened the survival of dominant industries. One banking organization was so aggressive that it approached the spouses of targeted candidates while their respective partners were at work to recruit the spouse as a decision influencer. It seems as though the dominant position the U.S. has enjoyed for years in the political/economic landscape has perhaps made our recruiting organizations complacent. As migration to the global economy causes rapid wage inflation in underdeveloped nations such as India, China, and Eastern Europe alongside steady wage deflation in hyper-developed nations like the U.S. and Great Britain, it is clear that such complacency may tip the scales in favor of the developing nations as the war for talent escalates.

A Primer on Poaching

Poaching talent is the practice of proactively targeting and hiring top talent away from a competitor or top firm, with the specific intention of:

• Securing skills or capabilities faster than if you were to attempt to develop talent internally through training and development efforts

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Last week I reviewed some of the reasons it is so critical that recruiting directors focus on finding and hiring great recruiters. This week I’ll focus on the actual tools and techniques your firm should use to do just that. Obviously no firm will use every one of these tools, so the key is to scan through them and pick the ones that best fit your culture, your requisite timeframe, and your budget. Some approaches may seem to be too aggressive for your firm. But read on, because the toolkit also covers more conservative approaches. (Note: The tools and approaches with the greatest impact are generally listed first. While this checklist is designed for finding recruiters, it can be easily modified for any position.)

Poaching From Other Firms

The very best recruiters are employed at other firms where they keep their skills up-to-date. Those most relevant to your needs are most likely sitting behind a desk at one of your talent competitors. If you want great recruiters you need to become comfortable with hiring them away from other firms. If your recruiters are resistant to poach recruiters from other firms, fire them on the spot!

1. Ask candidate finalists you lose who the winning recruiter was. When you lose a candidate for a hard-to-hire position to a competitor, call them up and ask them the name of the winning recruiter. Do the same when you hire a recruiter from a competing firm (ask them on the first day who their former firm’s top recruiter was).

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