It’s Not Easy Building the Perfect Recruitment Company, But Your Future Depends On It

Apr 11, 2014
This article is part of a series called News & Trends.

Achievement cloud - freeA while ago, I wrote an article that was posted on (“Why Recruiters Will Be at the Heart of Our Corporate Future”) trying to explain my concept of what of “good recruitment” was and why recruiters will therefore be at the very heart of our corporate future. I received a lot of great feedback on the post but also some negative comments about how employers and candidates felt after interacting with recruiters. There were also some strong feelings about the impending demise of our industry due to technology improvements and in house recruiting teams.

Consequently, I thought I could extend my opinion yet further to outline another opinion of the structure of “the perfect recruitment company” in today’s world and highlight how recruiters can learn and improve using technology, learn lessons from Silicon Valley and out-compete in house teams for high margin business.

There are five key common principals to the mind-set and success of Silicon Valley companies:

  • Value People – They are all team players and should all be able to gain an equity ownership in the business.
  • Value Ideas – Ideas are the prized commodity in Silicon Valley.
  • Take Risks and Accept Failure – This is part of the human experience that makes you smarter.
  • Innovate – Let go of old ideas and reach out to your customers for feedback.
  • Think Of Yourself As A Startup – They are lean, hungry and open and have no legacy to tie them down.

In all honesty does the recruitment industry as a whole apply these principles? If it did would the perception of the industry and individual company performance be vastly different, and would this create the perfect recruitment company? Is it possible to run a profitable recruitment company this way?

Value People

It’s not uncommon for a lot of companies to say “people are our biggest asset,” but how many recruitment companies behave in a way that is consistent with this? I’ve interviewed recruiters from competitors in Asia, Europe and the USA and very few can clearly articulate how they are paid and how they can achieve progression in their current company. Both of these things seem to be very complex and have large amounts of management discretion involved.

The best brands to work for in the world, in any industry, tend to have very clear values that genuinely influence hiring and daily behaviors in the business. They have clear management structures, consistent compensation schemes, even across international geographies; good benefits (which I accept can be tricky in the U.S. for a start-up or small business because of the cost of healthcare); and provide a share scheme that everyone can participate in to encourage the right behaviors in line with the company values. Everyone should be able to articulate the goals of the business and know what their contribution is to it and be clear how their performance is measured.

Value Ideas

Every recruitment company encounters challenges every day. The ideal solution to them will not be found in a book or in a script. We are in a rapidly evolving industry and our service, how we charge for it, what we are offering, and what we need in order to excel, is also all rapidly evolving. The people that have the best ideas about how to “future proof” your business and stay ahead of this curve, are not sitting around a boardroom table; they are on the phones and shaking hands with the clients.

There needs to be an effective mechanism in the company of getting these ideas from the coal face to the board room, and then actually implementing change for the good of the whole company. This clarity and efficiency of upwards communication is traditionally very poor in recruitment businesses. Problems are normally identified only when someone has left.

Take Risks and Accept Failure

This is a difficult one to grasp as no one wants to fail, but you just have to accept that if you are going to gain market share and innovate, some things will work and some things won’t. There is no need to tinker with everything all the time but a great idea is worth trying as long as it runs concurrently with the successful business. The only way to change the game is to try and if a fear of failure strangles innovation someone else will beat you to the finish line.


I see a lot of companies that have deeply embedded flaws in their business models for the modern world of recruitment. They have organized their companies from a perspective of management convenience or on what was relevant 10 years ago but is now obsolete, rather than for what the candidate or client wants.

Recruitment has evolved. Generalist recruiters offering a poor service or who just focus on the 10 square blocks around their offices are a dying breed. You need to be able to offer clients and candidates deep industry knowledge, and also be a specialist in a vertical market. You not only need to use social media to source candidates, you need to use it to create communities of candidates and clients that you interact with and meet with regardless of whether they are hiring or looking for work

It is time for recruiters to be engaged, focused and committed. It is time to take a long-term view to build your firm’s reputation within each industry you focus on — not to simply chase the next dollar. It’s time to drop management based purely on KPIs and look at the technology available – technology that can give you analytics on which recruiter in your company is the most efficient rather than which recruiter is just pumping out stats. It’s time to train consultants on the subject matter for the sector in which they recruit not just “how to close a deal.” What is the point of differentiation that your company genuinely offers? Clients? Contacts? Employees? And why are they going to stick with you?

Think Of Yourself as a Start-Up

This is possibly the most important point of all. A start-up treats its first client like a king, they stay close to them; make sure they are happy and receiving an amazing service. They go the extra mile to make sure that anyone can use them as a reference as to the quality of the service and the people in the business. The first client is also a critical choice as a company needs to be 100% sure it will be paid fairly and promptly for their services or the company could be very short lived.

In a start-up recruitment company a great candidate is also a king because, irrespective of whether you place them, the experience they have dictates whether or not they will refer you to another great candidate or use you to recruit in their new role. A start-up team works harder and longer for less because they believe in what they are doing and in the vision of the business. The staff in a start-up is very close and the long term goal of success is what drives them and binds them. If you can bottle the feeling of the start-up and keep it within your business, then no matter what size it becomes you have a magic formula for success. The minute the business become bloated and lazy and cuts corners you will be losing business to a hungrier company, and you can’t afford that in the current climate.

Not an Easy Path

It is not easy building a recruitment company attempting to reach this utopia. Clients sometimes just want an ass in a seat and actually aren’t interested in their future talent. Some just want CVs sent through a portal and prefer to not even interact with a recruiter.

To put this into perspective, some people drive a beaten up old car; some drive a very well kept family sedan; and some drive a performance sports car. Companies choose their people and therefore their appropriate recruitment partnerships in the same way. Equally, it can get very challenging to constantly find recruiters who are both capable and passionate and will push through the pain barriers to build an amazing company.

We are in a quick fix generation where the vast majority of recruiters want to know what’s in it for them right now rather than “How do we build a great company.” This is where the world of recruitment and Silicon Valley diverge. In this generation, the brightest minds go off in search of the experiences that will make them the next tech billionaire. They are prepared for hardship along the way as they believe in the long term vision. Recruitment companies are fishing from the remaining pool of bright minds, trying to convince them that building a utopian vision of recruitment is the path to their fortune. That’s a tougher sell than the Facebook or Google path.

Those that take on the fight will get a lot closer to the vision than most because they are the ones that will get up every morning believing it’s possible. Is your company doing the same?

This article is part of a series called News & Trends.
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