I’ll demonstrate why there is a confluence of factors that make this a “perfect storm” of opportunity if you implement a countercyclical hiring strategy.

I’ll start out with three analogies that show how this current economic lull is an outstanding opportunity to fill your forecasted senior management vacancies that will result from baby boom retirements.

Analogy #1 — Understanding the Perfect Time to Buy

Any manager who has participated in a significant volume of corporate purchasing negotiations realizes that there are economic and competitive factors that make a particular period the “perfect time” to get the best deal. The “best deal” means a procurement opportunity where, with little effort, you are likely to get the best quality, the broadest selection, and at the lowest price.

The five factors that provide a “perfect deal” opportunity include:

• No competition — when your competitors aren’t buying.
• High availability — when the available quantity or volume of the product is high so that sellers have a surplus.
• High-quality — when the quality of the product is high.
• Low cost — when the cost is low (because of the high supply and the low demand).
• Low supplier power — when the weakened bargaining power of the seller has made them more open to concession in terms.

For many markets, it’s a “once in a generation” perfect-storm opportunity when these five factors occur simultaneously. While many nations do not have a labor shortage, many including the United States do have a talent shortage.

If your organization has struggled in the past two decades to find top talent to fuel growth initiatives, this temporary respite in competition for labor should be leveraged to the hilt.

Procuring high-quality talent at low cost and with minimal effort would certainly make you a hero among senior managers with mounting volume of work to be completed.

Analogy #2 — Understanding the Perfect Time to Acquire Exceptional Sports Players

Let’s assume for a few minutes that you run a professional sports team. You would quickly realize that the best time to build a sports franchise by recruiting enough star players to give you the capability of winning the championship would be when most of the following “five factors” are present:

• No competition — the other top teams aren’t recruiting, so no one else even bids on top talent.
• Talent costs were low — because no one is actively bidding, the costs of acquiring any available talent would be low.
• High-quality talent available — an opportune time to recruit would be when there were a number of genuine superstars available and in addition, there was also a large volume of high-quality talent available across all of your key positions.
• The players lack power — whenever there is a lack of competition and few open positions, even exceptional players become amenable to considering and accepting job offers that they would not have previously been considered.
• Everyone is recruitable — and most important, all in the case where all no trade clauses have been made null and void, you could literally “take” any player from any team without any remuneration or legal restrictions.

Actions that you would take when most or all of these factors occurred would include:

• You would over-hire players — should this “perfect storm” confluence occur, the opportunity would undoubtedly excite both you and your managers. It would probably also cause you to expand your recruiting, so that you would “load up” with talent, even in positions where you were already satisfied with the talent you currently had.
• You would designate “evergreen jobs” to ensure you never have a shortage of great players. For these few roles, you would continually recruit and hire exceptional talent whenever it was available at a reasonable price. The logic would be simple. In the sport of baseball, you could never have “enough” pitchers with an ERA of under 3.0. If you “own” all the talent, your competitors can’t. If you had “surplus talent” in key positions, you could just adopt new approaches to take advantage of the available talent.
• You would make immediate “opportunity hires” — if the team that you managed was a professional golf team, you would have previously assessed all of the top talent in your league. As a result, you would not need a lot of time to decide who you wanted to hire and who you didn’t.
• You would directly “raid” other firms when they are weak — unlike in professional sports, there are no restrictions on recruiting away top talent from competitors, so you would develop an active poaching process to take their best players when their team was at its weakest.

Analogy #3 — The “illogical” current corporate recruiting strategy

In 99.9% of all corporations, if Tiger Woods (or his equivalent in business talent) walked into your recruiting office and you did not have an open requisition for his specific position, you would literally send him away. Because the economy is down, corporate recruiting is stuck in cost-cutting mode. It isn’t doing any significant sourcing or hiring and the CFO may in fact have already decimated the recruiting team.

Most would classify this current time period as “bad times” when you lay low to avoid getting the recruiting budget cut even further. You certainly wouldn’t view this as the best time for recruiting in a generation.

All the Factors Point to a Great Time to Recruit

The purpose of these three related analogies is to demonstrate the identifiable factors that make it a perfect time to buy. You might be surprised to learn that whether you’re buying products or sports stars, the factors that make it “an ideal time to buy” are strikingly similar.

Currently, top talent is abundantly available; at no other time in recent economic history has the pendulum swung so far toward the advantage of the employer.

Unfortunately, most corporate recruiting leaders haven’t taken advantage of this opportunity. Perhaps the leaders in corporate recruiting are too close to the situation to actually see the tremendous opportunity that is facing us today.

Because revenues are down, today isn’t the perfect time to do large-scale hiring, so implement select “surgical hiring” where you selectively build your organization by hiring a relatively small number of exceptionally talented individuals for your key positions.

In the following section I’ve provided the most important factors that should cause you to begin countercyclical hiring.

The Perfect Time for Recruiting

• Competitors are out of the market — almost no one is in the talent market right now. Most firms have instituted a hiring and/or a budget freeze, which means the competition for talent is ridiculously low. They won’t need to enter into a single bidding war for top candidates when the talent competition is out of the marketplace. In addition, you might feel relatively alone among corporate recruiters, if you choose to visit college career centers.
• High-quality talent is available — in some downturns, only low-quality talent is laid off by corporations. However, during the current downturn, because of a large number of recent mergers, facility closings, and the complete elimination of some major firms, the amount of extremely high-quality unemployed or underemployed talent available around the world is at an all-time high. Even currently employed top talent who have jobs haven’t been treated very well during the downturn, and a record number of over 60% of these fully employed individuals are open to new opportunities.
• Costs are low — the lack of competition and the down economy have forced the price of available talent in almost all positions back down to reasonable levels. New referral approaches and Internet and social networking recruiting tools have also reduced the cost of recruiting talent. Taken together they have dramatically decreased the cost of adding talent.
• Talent is amenable — the lack of available job opportunities has “shifted the power” away from talent and toward corporations to the point where top talent will consider job opportunities and options today that they would have rejected as little as two years ago.
• The coming retirement wave — the dramatic reduction in stock prices and 401(k) values has temporarily postponed the upcoming wave of retirements. Despite this delay, these retirements will come eventually and if the economy turns around suddenly, firms may very soon be faced with a tidal wave of retirements. Because large-scale retirements may begin in as little as a year or two, now’s the perfect time to “stockpile” and develop possible replacements for your most experienced managers and technical talent.
• The coming retention problem — if your organization is among the many that have undergone layoffs, frozen hiring, reduced budgets, and maybe even cut salaries through the use of furloughs, the odds are that your current employees are overworked and stressed. This less-than-perfect treatment coupled with the fact that many of the “new generation” of employees have little to no loyalty to a single firm will result in a dramatic increase in turnover as soon as more external opportunities begin appearing. Obviously, you should begin retention efforts immediately but it may not be possible to remove the “bad taste” that your current employees experienced. Expand your recruiting efforts to find replacements and realize that new hires are likely to be more loyal than most employees because they are now seeking security and they would certainly remember the fact that you “saved them” during a period when no one else would even look at their resume.
• Remote work is more feasible — the unwillingness of some talent to relocate has limited a firm’s talent options, but the increase in knowledge work coupled with the currently available technology makes it possible to allow top recruits to work at home with no loss in productivity.

Other advantages to countercyclical recruiting include:

• There are benefits if you “begin looking early” — the competition in the market for products and services has not slowed down in the slightest. As a result, companies are now planning numerous new technologies and processes to increase their productivity. By hiring now you provide new hires with enough training and development time to be up-to-speed as these new technologies come online. Hiring individuals before you need them also gives them a chance to adjust to your corporate culture. Hiring a surplus of talent will provide you with an opportunity to “release” employees or new hires who can’t meet productivity goals. A final advantage of beginning your recruiting search early is that even if you merely stretch out the time period over which you are actively looking for talent, you automatically increase the odds that one or more top individuals will become available during the extended search time.
• So what if you hire too many? — can you imagine a sports team having too many stars of the caliber of Tiger Woods, Kobe Bryant, or A-Rod? With this exceptional talent, you could more easily beat your competitors. I once saw a general manager at Agilent Technologies respond with astonishment when an HR manager suggested that it would be a problem to have a “surplus” talent in our number-one, high-impact position. The GM responded without hesitation that “would be a nice problem to have.” If we had too much talent in that position, “we would just try new things because of our increased capability.” I hope that you can see that, yes, there would be some added costs in “over hiring” but the opportunities and benefits would far outweigh those costs.

Update Your Recruiting Strategy with These Seven Elements

Hopefully the analogies and the eight factors listed above have convinced you that now is the time to rethink your approach to recruiting.

If so, there are seven major elements related to countercyclical recruiting that you need to consider adding to your current recruiting strategy:

1. “Pre-need hiring” — this approach is where you build relationships and hire talent before you actually need it in order to provide ample time to develop and acclimate to your culture .
2. “Over hiring” — over hiring is where you purposely hire more talent than you immediately need in order to prepare for an “upturn” in demand. Alternatively, you can also use this as a stimulus to “swap” poor performing current employees with high-quality replacements.
3. Build a talent pool — a “talent pool” is a group of highly desirable talent that you identify, assess, and build relationships with over time, so that when an opening occurs, most of your sourcing and initial assessment is already done.
4. Opportunity hiring — this approach involves quickly “pull the trigger” and immediately hire superstars (that you have pre-identified and pre-assessed) immediately as they become available.
5. Most wanted list — this element is a combination of talent pool and opportunity hiring. Under this process, at the beginning of the year you select the top 25 (up to 100) most desirable individuals in your industry. You essentially “prequalify” them and you then spend the rest of the year trying to recruit them. As soon as one becomes available, you make a hiring decision.
6. Employer brand re-building — odds are that if your firm has undergone layoffs, furloughs, mergers, or bankruptcy that your external image as a “top place to work” has been severely damaged. Add to corporate actions the fact that numerous opportunities for employees (current and former) to share their perspective online have popped up in recent years and it becomes clear that nearly every organization needs an aggressive strategy to manage their brand perception online.
7. Approaches for identifying when your competitors are recruiting – “countercyclical” recruiting is where you recruit talent during times when other firms are out of the talent market. If you are not sure who is recruiting actively, have an intern check your competitor’s websites to see which jobs they are recruiting in high volume.

Final Thoughts

A handful of firms (Google, Slide, Microsoft, Principal, and HP) have to be recognized because they understood both the need and the opportunity to continue hiring during this downturn, even though they too may have been cutting their workforce.

However, the majority of recruiting directors haven’t taken advantage of this once-in-a-lifetime recruiting opportunity. I can only identify two major reasons for their lack of action.

The first is that they have just failed to be strategic and instead had a misdirected focus on cutting recruiting costs, rather than the more impactful strategic focus of increasing corporate revenues.

The second more palatable reason is that they understood the opportunity but they just didn’t have the capability of building an effective “business case” with senior management. That latter reason in one I’ll tackle in a future article.

Only first names were to be used, and nothing was to be put in writing. Even though I was the head of recruiting and staffing for a large, multi-national company, I was putting my team in serious jeopardy just by having this conversation. Fortunately, the liaison was successful — we were not caught that day, and so far no one has discovered that we met together.

What am I describing? An international spy ring? The sale of competitive intelligence?

No, it was something much more serious. I was talking with a vendor … without a representative from the Procurement department present.

This will doubtless be remembered as a bumpy year for those of us in this profession. While finding talent in a market that has been turned upside-down represents a major challenge, it’s the secondary effects of this economic downturn that will truly test those of us in Talent Acquisition. I recently wrote about the likely increase in “executive referrals” resulting from current economic conditions. Other secondary effects could include anything from a reduced talent pool in the coming years (as families struggle to justify the return-on-investment of a college education), to an almost certain delay in the migration of the Baby Boomers to the Happy Hunting Ground of retirement.

While these effects are years away, there is another implication that you’ve probably already encountered — the increased influence of Procurement and Purchasing departments in the Recruiting function. And with so much renewed emphasis on spending, I predict you’ll see Procurement play an even greater role in the coming months.

No matter which side of the recruiting aisle you sit on (corporate or vendor), you’ve doubtless encountered Procurement departments by now. They’re the group that coordinates RFPs, negotiates prices, and even gets involved in managing vendor “performance.” It’s becoming more and more difficult to spend a single dollar on a product or service without their involvement nowadays. How are people reacting? Some enjoy leaving the “negotiating” to the experts; others feel like involving strangers interferes with trust-based vendor relations that have in many cases been built over a period of years. Regardless of your opinion, however, this model is here to stay.

How did this happen? When companies decided to get “leaner” back in the 1980s, they started buying raw materials more strategically. As a result, they began seeing huge improvements in cost-of-goods-sold as trained professionals scanned the markets for price, managed supply-chains of goods, leveraged the trade-offs between volume and price, and generally took a long-term approach to raw materials purchase. With subsequent enhancements in technology, it became even easier for companies to begin purchasing from a global market.

Another interesting change then began to take place: in addition to purchasing bulk commodities like iron ore and precious metals, Procurement departments began getting involved with large national contracts to purchase office supplies, technology, rental car contracts, and even started establishing preferred airlines for their organizations.

This was nearly always great for the company. It increased efficiency, and drove costs down. The challenge that we’ve all started encountering is that such a cold and impersonal approach can have its limits, particularly when it comes to people. Let me first state that I am completely in favor of running businesses as efficiently as possible. I support the work Procurement does, and sleep better knowing companies are paying the true market price for steel and corn oil. However, a process that was developed to purchase bulk quantities of material, ship it in container vessels, and store it for months until needed has some rather interesting implications for the acquisition of top talent.

Take my secret meeting, for example. I was talking with a trusted vendor with whom I’d worked for years. Things were pretty simple in the past — a company would have an open position, I’d ask my vendor-partner to work on the job, and they’d fill it.

Now, my fairly-straightforward relationship suddenly becomes very complicated. For example, I must first get my trusted vendor on the Approved Vendor list. In the most common scenario, the Master Service Provider determines the bill rate or the mark-up that can be charged (which usually must also cover a 2%-3% fee for them). My trusted vendor might not be able or willing to work at those rates. As such, the “approved vendor list” I ultimately end up with might consist of untried and/or undifferentiated firms who were chosen based on price alone.

The second hurdle is how to efficiently communicate with the third-party vendors who are actually recruiting for my position. Third-party vendors are often prohibited from speaking directly to me by contract; instead I must enter my requirements in the Master Vendor’s system. Questions regarding my position are asked and answered in writing. Third-party vendor phone calls are made to vendor managers, who are then supposed to capture feedback and communicate it back.

My research leads me to conclude these processes often seem cumbersome and arbitrary to vendors. Measures that are important from a traditional procurement perspective (quick turnaround times, low fees, and long contract periods) are not necessarily the same measures that create an environment for finding top niche talent, but vendors are measured only on these key metrics.

Clever vendors know where to pay their tribute. I’ve had my Procurement department inform me that they’d had extensive meetings with a job board, and were about to sign a major contract. Not only did I know nothing of the conversations, but I had rejected this particular tool months before. So why was procurement so anxious to sign? Because they’d negotiated a great rate, of course.

Procurement as a corporate function is here to stay. However, there are a few things you can do to make your relationship thrive.

Figure out who they are: Find out who comprises your Procurement department. Schedule time to meet with key leaders, and engage them before the next RFP. You have more in common with this department than anyone else; after all, you’re responsible for procuring a raw material every bit as important as printer paper. You’re responsible for procuring Talent!

Establish yourself as the decision-maker: Like any service function, Procurement wants to help you. They really do. As we’ve already seen, though, the prime measure of success is cost. And in 10 years of recruiting, I’ve never met a single hiring manager who told me that cost was the most important thing to them, and you probably haven’t either. Ultimately, you own the relationships you have with your vendors. Make sure Procurement understands that you are the decision-maker.

Find a way to work together: With the current emphasis on cost, you’re likely to see Procurement involved in nearly anything that involves paying an invoice. This year they may oversee your temporary labor contract, but next year look for them to become involved with retained searches and career fair giveaways. The point is that they have a job to do, and you do too. Invest in whatever is necessary to ensure you’re sharing information and working together.

Advocate for your customers: While learning to work together will necessarily involve compromise, never forget who you are ultimately there to represent: the job-seeker. Contracts that may seem advantageous to your company because they’ve resulted in huge rate reductions may end up costing you in the long run as vendors choose to simply not work with you, or not to send along their best candidates. I spoke with several vendors as I researched this article who said that they have been in situations where they were “asked” to accept maximum bill rates that were a third less than the amount of some candidates’ actual pay rate! While this looks great on a “vendor scorecard,” it means those companies never even get to see top candidates.

Share successes publicly: Chances are, you can learn a lot from your Procurement colleagues. And they can learn from you. Once you have that first shared victory together, be sure to publicize it. Executives love hearing how the company attracted top talent, but they love hearing how money was saved even more! Setting a public example of how to engage Procurement effectively is a great way to build your own organization’s brand as well.

Some people say good times are just around the corner; others say more bad times are ahead. In either case, companies are sure to continue using Procurement professionals to keep costs down. Learn what these colleagues do, and learn to work with them. If you do, it will mean getting the right talent into your organization at the right price. And that beats secret meetings any day of the week!

It is not affecting employment across the board as many of the past ones have, but rather seems to be targeting specific sectors and types of work. Obviously banking and financial services, but also manufacturing and anyone in a semi-skilled job such as auto workers are especially affected. Needs are pocketed and specific. Talent shortages remain.

Yet, I have had calls from search firms looking for key sales and marketing people, and for R&D talent. Senior HR executives are in demand, especially if they have global experience. Sectors still largely unscathed by the recession – healthcare, gaming, entertainment, pharmaceuticals, and biotech – are still facing talent shortages and global competition.

The growth of global supply chains, increasing automation, and greater process efficiency means we can do more with fewer. New jobs are being created daily, but they all require education and skill beyond that of many current candidates.

This, combined with the different attitudes candidates and employees have about work and about how they live their lives, changes how we recruit and employ people.

The highly skilled, experienced, and educated will have an increasing edge in employment. And this recession should be a clarion call for an increased focus on education, training, and employment development. Everyone involved with talent will need to look at both development and acquisition as channels to meet their needs, rather than focus entirely on recruiting.

There are a number of permanent changes we will see.

Candidates Become Smarter, Warier

The first change is that many candidates will be reluctant to work under the same conditions as usual. Candidates have access to unparalleled information about a prospective employer through the Internet and its many sources. Reliance on a single firm for security has already eroded, and this recession will strengthen employees’ wariness about promises and deferred compensation. More top employees will seek employment contracts that include clauses that spell out layoff pay and benefits.

Candidates will probe positions more deeply and they will want more influence over the type of work they do. Prepare for candidates to negotiate what they will and won’t do.

Free Agency

Recessions have, in the past, increased the pool of people who decide to become free agents – contractors, consultants, and part-time workers. More people than ever are trying out life as independent workers. Many will not make it and return to the corporate fold, but they will be wiser and better prepared to abandon ship than they were before.

Many others will find they would rather work on their own than go back under the very insecure and fragile corporate umbrella. Companies will have to identify and take care of their key producers better than ever. While many firms do work hard to keep key talent, they will have to increase this effort and explore more creative ways to engage those people.

Charles Handy, a management writer and educator who has written numerous books on the organizations of the future, predicted that up to half of some company’s talent may eventually work as free agent, contracting to those firms as temporary staff, contractors, or part-timers. This will be a lasting change that is accelerated because of the recession.

Recruiters and HR staff will have to accommodate these free agents. Our internal regulations will have to be modified to make the use of contractors legal and compliant with IRS regulations and it may be necessary to lease employees, employ more employment contracts, and learn to share talent between organizations.

These changes will be fought by the legal department and more HR leaders, yet I believe companies will eventually have to embrace these ideas to be competitive.

Values Rule

Gen Y candidates, in particular, but all employees to a growing degree, are seeking companies that hold values high and make and keep commitments to their employees and their families. They seek environmentally sensitive, charitable, and ethical firms.

Gen Y is the tip of a spear followed by the even more morally and environmentally committed Gen M. They will have even higher expectations than the Baby Boomers ever did. While shareholder value will always be a core concern of the management team, they will also have to understand how important employees feel that values are and how close a scrutiny they will give every corporate action and statement.

Recruiters have to understand the values of the firms they work for and find better ways to match people to those values. They will have to also convince the management of firms that what they DO is just as important as what they say and that this emerging candidate pool focuses on actions almost entirely.

Flexible Work Arrangements

Employees now want to work where they want. The Internet has made it possible for most services and knowledge workers to be located far away from the physical center of their company.

Designers, call-center staff, sales people, some HR folks, and most anyone who works with information, writing, or data can effectively work wherever they wish. Only a handful of people – those whose work requires their hands or eyes on the work being produced – will need to physically be present. Even jobs we cannot yet imagine being remote, such as that of a diagnostic physician, may soon be possible using instruments and video from anywhere.

Recruiters will need to encourage flexible work arrangements and lobby with hiring managers to make these arrangements normal.

Recruiting will be more challenging and those recruiters who like to “fill positions” will find themselves looking for other kinds of work. Recruiters will need to be proactive, great influences, technically savvy, and adaptable to emerging work trends.

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!

His company, ABC, needed some very specialized people and he couldn’t find them. For over two years, Paul had tried to fill some very specialized and always open positions by using Internet search and revamping the career site. He had even put his reputation on the line a few months back when he insisted that a central sourcing team would solve the perpetual lack of qualified candidates.

He had just finished a tough meeting with his sourcing team trying to figure out why there were no candidates in their talent pool. He had been certain that there would be several potential people from that pool; when the hiring managers had told him about their openings, he had assured them it wouldn’t take very long.

After all, the team had known about the competencies these positions required for months. Now it looked bleak.

What had gone wrong?

When he took his current position, he was aware that finding the highly specialized robotic engineers and technicians the firm needed was his number-one challenge.

Even though the organization was located in the heart of the academic world, with major research schools and labs everywhere, these robotics people remained a scare commodity and the few that he did find were happier remaining in academia.

He had worked with compensation to sweeten the incentives and he had spent time with a big-name advertising agency honing the recruiting messages and redoing the career site. They had won awards and been written about in ERE and in recruiting blogs. Paul had been given several awards. But he was failing.

The company was quite unique. It developed robots that mimicked the human hand. These mechanical hands were incredible. They could pick up an egg without breaking it and yet they could slice through a piece of steel like scissors through paper. They could manipulate, sew, pick up tiny parts, and insert them into circuit boards and they could perform some types of surgery, with assistance from a human doctor.

The demand was growing rapidly, yet the supply of people to design, improve, and manufacture them remained small. Not many schools turned out robotics engineers and not many students choose that as a career.

The engineering team had also placed tight competency requirements on candidates. Every candidate had to have degrees in at least two related disciplines, such as mechanical and electrical engineering, or computer science and mechanical engineering. Or, they had to have 5 or more years of experience and a single degree.

Hiring managers wanted prior experience in robotics, if possible, or experience in manufacturing or designing miniature components or nanotechnology. They wanted engineers capable of demonstrating these products to a global customer base. And each robot had to be installed and “tuned” for each customer, which frequently required foreign travel for a long period of time.

Even though Paul had pushed back on these tough requirements, he had not been able to change their opinions. And his sourcing team couldn’t find the right people.

So here he sat on a lovely afternoon, befuddled and at a loss. Should he quit? Did he admit defeat? Was there a way out? What strategies or tactics could he apply to this situation that might rescue him, and the organization?

I am hoping you can help Paul. What are your ideas and suggestions? I will summarize them and add my thoughts in a future column.

To compound this situation, we do this in an environment of constant change (shifting priorities, new requisitions, etc.).

If not managed properly, it is easy to lose focus, get de-motivated, and become non-productive.

To avoid this situation, most top sales organizations have a weekly “sales” meeting. Objectives of these meetings include:

• Make sure each salesperson has a focused plan of action for the week.
• Make sure each salesperson’s plan includes an adequate amount of measurable “outbound” activity.
• Set team/individual priorities.
• Discuss any administrative loose ends.

If, for some reason, you are not having a weekly “recruiting” meeting, start now. Based on the challenges outlined above, I can’t think of a logical reason why you wouldn’t.

In our research efforts, we have learned that the best sales organizations not only have meetings, but the salespeople enjoy attending them!

While the clear intent of these meetings is to get focused for a productive week, unfortunately, the majority of companies’ sales meetings are mundane, boring, and unproductive.

Most sales professionals view these meetings as a “necessary evil” to provide management with a status on progress toward their goals.

Indeed, during my 19 years in recruiting, I have attended my fair share of boring, mundane meetings!

To avoid falling into this trap, try the following meeting agenda/format. It provides structure and sets the tone for a productive, positive week:

Meeting particulars:

• Hold this meeting first thing Monday morning starting at 7 or 8 a.m. (depending on company culture, attendee’s personal schedules, etc.)

• Limit the meeting to no more than 15 participants. If you have a larger team, I assume there is some logical way to break the team into groups of 10-15 people based on line of business you support, geography, etc. There is no minimum required. If you have two people on your team — meet. If it is only you, meet with yourself.

• With today’s technology (conferencing, web meetings, video meetings), you can’t use “geography” as an excuse for not getting together.

• Keep the meeting to one hour. To keep the meeting on schedule, remember these tips:

1. The moderator is responsible for keeping the meeting positive and lively, but also on time! Every minute the meeting runs over, the moderator owes $1 (or some other form of motivation).
2. In addition, all late participants must donate $1 for each minute they are late (it is amazing how people become respectful of being on time when you adopt this policy).
3. This money can be used for a teambuilding event, given to charity, etc.

Meeting agenda:

Let’s start the week off right!

• Share a great, positive story from last week/weekend. Stories don’t have to be work-related. Personal, positive stories are the best.

• Business review. Review your current open positions. Discuss status, pending action items, next steps, etc.

• Discuss last week’s achievements. Each week, we recommend each person develop a Perfect Week. This is a list of billable/non-billable activities you would like to get done during the week. These action items can then get scheduled into your Perfect Day routine. At this time, have each person discuss the past week, including:

1. Overall week; how did things go based on what they set out to get done?
2. Top two or three most critical things they accomplished last week.
3. Maybe the two or three things that did not get done last week that will either become this week’s priorities, or, possibly removed from this week’s “to-do” list.

• Biggest frustration(s) last week. Let it out! We all have had weeks when things don’t go the way they were supposed to go. If your frustration is dragging into this week, ask your teammates for solutions to make it better/solve the problem.

• Visualize this week’s “Perfect Week” and post goals in a public location. Discuss the critical things you have to get done (billable/non-billable) to make this week a “Perfect Week.” If possible, have each team member post them in a central location (whiteboard in your office?) so everyone can see. As you go through the week, cross off the activities as they get accomplished. Crossing off tasks on a to-do list feels good and can motivate others around you.

• Visualize your “Perfect Monday.” Discuss the critical activities you have to get done today (Monday) to have a “Perfect Monday.” Being motivated and productive early on Monday can set the tone for the rest of the week.

• Education. Each week, have a person on the team (rotate this duty each week) discuss something we didn’t know about our clients, recruiting, and our industry. Make sure this discussion is no more than five minutes. Providing a “short” handout (don’t pass out War & Peace) people can take away and read is great.

• End with a positive thought (or two or three) for the day.

In order to accomplish these agenda items (on time), everyone must embrace and practice the Milo Frank habits about getting your point across in 30 seconds or less.

Have fun with this process. Each week, have a different person moderate the meeting. This is a chance for us all to come together and get motivated, focused, and ready for the week.

Your thoughts/comments on this subject are welcome. I hope your next weekly meeting is a great one.

Last week we introduced the concept of an employment product manager, an individual who would oversee the development and positioning of employment opportunities using approaches similar to those used by product managers in a products company.

This week we will turn our attention to the development of a prototype job description for such a role and explore where the role should be positioned in the modern organization.

However, before we begin, we would like to take a quick opportunity to respond to several questions that arose following last week’s introduction of the concept.

Question One: Do you think the time will come when employees will ever be willing to “pay” for the opportunity to work for a specific company? Or are they doing that already?(Submitted by Maureen Sharib of the ERE community.)

This is a great question, and one that gets to the very distinction our previous article was trying to make. The answer is that we believe employees are already paying for the opportunity to work for a specific company, they are just doing so using a currency we often do not consider. If you look at employment opportunities as products, each with a unique set of features and you look at talent as consumers, it becomes clear that talent buys employment opportunities using a combination of currencies that include time, motivation/commitment, skill/knowledge application, etc.

Many organizations already demonstrate the flip-side of this mentality, viewing talent as the asset being acquired primarily because organizations use a more traditional currency to pay for it. In reality, a true barter system is a play. To make the most of such a system, we have to become as adept at marketing unique opportunities as talent does at packaging a unique combination of skills, knowledge, and abilities.

Prior to asking this question, Sharib indicated concern that the vast majority of the talent population do not have what it takes to respond to an employment opportunity and that until the masses stop manifesting the “soup to nuts” expectations they have of employers, they will not respond to the concept of product marketing.

While not phrased as a question, this point is a critical one. While product marketing would most certainly become an output of implementing a formal employment product management role, product management and product marketing is not the same thing. The role of the product manager would not be to position an existing set of employment products, but rather manage the development of new ones and the revision of existing ones using a defined methodology.

With regards to talent not being capable of responding to employment opportunities, our response is simply that the inability of them to do so is our fault. When a product fails to generate the demand and consumption by a target customer group, it is because:

• The product did not meet the perceived needs of the consumers.
• The product was not positioned appropriately.
• The product was not visible to consumers.
• The product was not priced so as to contribute to the perception of best value.
• The product sucked.

Sales professionals have long understood that to make a successful sale you must be able to align expectations. The HR profession has long practiced the art of inflating expectations, not setting realistic ones that can be delivered on. Nearly every piece of recruitment marketing that exists today communicates a bland, non-descript employment opportunity that does little to establish expectations among the talent population you hope will respond. We use terms like “employer of choice,” that lack a consistent definition, which enables the talent to develop their own definition, one rarely if ever communicated to the employer. When customers are permitted to establish their own expectations in secret, your chances of meeting them as an employer are slim to none.

Question Two: I can easily see how companies that can execute this concept would develop a true competitive advantage in the labor market, but how realistic do you think it is that HR would ever be given enough authority to formally manage employment opportunities given that a large portion of what defines an opportunity is controlled by line managers? (Submitted by Todd Kaufmann via e-mail)

This is, for lack of a better word, a phenomenal question. The human resource profession has historically (and continues to) position itself as an administrative function. While many human resource leaders were granted a seat at the table under the auspices that their functions could contribute strategically, in reality, few functions ever transitioned beyond the realm of transactions. Our current position can also partially be attributed to the lack of a standards organization to provide leadership to the function, but that is another topic. Luckily, organizations may be more ready for the employment product manager than many current HR professionals perceive.

Around the globe, traditional HR leaders are being tossed aside, replaced with professionals from operations, finance, marketing, and in some rare cases, engineering. This trend signifies that corporate leaders not only expect the development of business infrastructure within the human resource profession, they demand it and will supplant any human barrier that stands in the way. Could the role of an employment product manager be established in a traditional HR organization? Maybe. But it is much more likely to be established in a category-killing organization that demonstrates they value top talent as opposed to merely talking about it!

To everyone who commented online or via e-mail, we thank you for contributing to a concept that could change the profession. Now on to that prototype job description.

The Employment Product Manager Job Profile

As you know, we hate job descriptions but accept that they play a role in our profession. What follows is an overview and list of major responsibilities for the role of employment product manager and a review of the basic skills, knowledge, and abilities needed to perform the role. (If you would like to add to the profile, we welcome your insights.)

Position Overview

The employment product manager plays a leadership role in the employment opportunity development process.

Strategically, this position partners with senior corporate leaders and the human resource function to craft employment opportunities throughout the enterprise that are seen as viable career opportunities by the world’s most elite talent.

Tactically, the employment product manager develops comprehensive employment product definitions that define the employee experience required and outlines the characteristics of all systems, processes, and organizational interactions required to deliver the requisite experience to a predetermined level of measurable quality.

This role owns the entire employment product development life cycle, from conducting market research and developing employment product definitions to delivering the products to market and troubleshooting/resolving any systemic issues that arise.

Employment Product Manager Responsibilities

The role of the employment product manager is one that involves both strategic and tactical deliverables. Approximately 40% of the managers’ time should be dedicated to strategic deliverables, while 60% should be allocated to tactical delivery. The major responsibilities in both categories are outlined here:

Strategic responsibilities include:

• Participating in workforce feasibility discussions regarding all new business concepts and initiatives, and strategic plans for existing operations.
• Consulting business managers during the development of business plans and work allocation models.
• Ensuring that optimal labor allocation plans demonstrate significant value for target labor segments, including full-time labor, part-time labor, temporary labor, outsourced labor, offshored labor, strategic partner labor, acquired component labor, and workforce automation; and that said labor can be secured at a total cost point that would deliver an acceptable benefit to the organization.
• Ensuring all resources needed and organizational experiences required to secure top talent are defined to the extent that requisite systems to ensure delivery can be developed through the human resource function in partnership with line and corporate management.
• Supporting and consulting in build vs. buy analysis for talent.
• Creating proof-of-concept documents that validate proposed employment products will deliver on labor requirements.

Tactical responsibilities include:

• Creating the employment product requirements definition (EPRD). This document outlines the specifications/requirements of employment opportunities needed to satisfy the expectations of pre-determined talent pools.
• Working with various human resource departments and functional leaders to ensure that human capital management systems developed conform to the requirements stated in the EPRD.
• Facilitating human capital management system design review meetings.
• Facilitating resolution of systemic employment issues.
• Working with line management to provide support.
• Working with organizational quality management staff to develop robust test plans and talent acceptance test plans.
• Creating employment product delivery plans, including work assignments, key milestones, timelines, deliverables, and product evaluation analytics.
• Facilitating employee/candidate perception testing (market research) when applicable.
• Working with other business functions to coordinate interdependencies and resolve issues.
• Reporting to the executive committee on the positioning of the enterprise and its component groups as an employer.
• Collaborating with product marketing professionals to outline the employment brand development strategy and ensure developed communications conform to messaging requirement outlined in the EPRD.

Employment Product Manager Requirements

The employment product manager role is a complex strategic-level role. To adequately perform all of the responsibilities defined above, organizations should look for individuals with the following combination of knowledge, skills, and abilities:

• Prior experience with product development or in-depth understanding of product development methodologies, combined with demonstrated project-management expertise.
• Ability to perform and oversee multiple complex projects.
• Ability to manage several timetables successfully in collaborative cross-functional environments.
• Demonstrated ability to quickly understand complex issues in human relations.
• Demonstrated ability to understand the business, and the core product/service development life cycles that the labor force must execute.
• Must be comfortable speaking in front of large groups that consist of a cross-functional group of management and line managers.
• Must understand abstraction layers between the “big picture” and the detail-orientated, and be comfortable working in both arenas.
• Good at troubleshooting, root-cause analysis, and remedy of systemic employment issues.
• Ability to effectively lead and influence cross-functional teams.
• Must be able to motivate others outside of direct reporting line.

Positioning the Employment Product Manager Role

Place this role within the enterprise such that it can wield a significant degree of organizational power and influence. Burying this role in the staffing department, or the human resource function, would all but kill the opportunity for this role to achieve its objectives.

It is clear based on past experience that for this role to succeed, it must exist as a leadership role within the executive operations rank. The optimal position for this role would be one directly reporting to a matrix of C-level executives including the CEO, CFO, and COO.

Conclusion

The time for change is now. The human resources function and the staffing departments cannot continue to exist as isolated, non-integrated units in service to the business. They must become part of the business. Look at employment opportunities as products, and formally manage their development and delivery across the enterprise using a methodology and infrastructure consistent with that which drives the development and delivery of the organization’s core products and services. Are you ready?