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.
Employees of Coca-Cola learn to disdain PepsiCo employees and vice versa. Most “Googlers” learn to disdain Yahoo! and Microsoft not just for what they do, but how they do it. This mentality can be found in every industry, in every size company, and in every country around the globe; it’s universally accepted that business is a competitive activity.
Advertisements that position one company’s product against another’s are common. Websites that go into detail about the strengths of a product compared to its competition are also common. Throughout the business world there exists an endless supply of examples that demonstrate sales strategies that directly position one entity against another and attempt to persuade customers to switch loyalty.
As the world becomes more and more flat it is abundantly clear that nations and states and municipalities also compete against one another everyday to secure a finite supply of resources. There is, however, one hold within the business world that has yet to accept the realities of business and adopt strategies that reflect it. This holdout is the talent-acquisition function.
Almost without exception, recruiting organizations live in a “bubble” of isolation. Yes, they accept that their company competes for candidates in the labor marketplace, but 95% live in a world of their own, devoid of a competitive spirit and without a plan to make recruiting a competitive advantage for their firm.
Because recruiters don’t view what they do as a zero-sum game, they are frequently shocked when new leadership requests they do a competitive analysis of the recruiting functions at each of the major competitor firms. Once they get over the initial trepidation, most recruiters realize that in order to “beat” an enemy you have to know what they are doing and what they’re planning for the future.
Competitive-advantage recruiting is a process of gathering information about the strengths and weaknesses of the competition and leveraging that knowledge to devise strategies and action plans that enable you to leapfrog their efforts.
A Lack of Concern For the Enemy
I look at business as being very similar to baseball. When a team announces its starting pitcher, you counter with a pitcher who matches or exceeds their skills. Managers put in left-handed hitters to get an advantage over a right-handed pitcher. It’s a continuous process of understanding their approach and then countering it to gain a competitive advantage.
The typical approach of recruiting managers is quite different. They seldom know the players on the opposing team, their strategy, or approaches. If you don’t believe me, see whether you can answer these questions about your direct talent competitor’s recruiting function:
- What is the name of their recruiting strategy?
- Who is their head of recruiting?
- Who is their very best recruiter?
- What is their most effective recruiting or sourcing tool?
- What is their biggest weakness? Strength?
- Which of their key jobs do they have difficulty filling?
- What times during the year do they do little or no hiring?
- When they beat you in a “head-to-head” competition for a top candidate, what is the primary reason that they win?
In baseball for example, this would be a no-brainer. Everyone on the team would know who their counterpart was, as well as what their strengths and weaknesses were. The same should be true for recruiting, but it isn’t.
The fact is, most recruiting functions do what they do without paying much attention to their talent competitors or the labor market in general. There is little attempt to identify and counter what the competitor is doing. I call this approach “living in a bubble.” Yes, recruiting the way you have always done it is easy and quite common, but it still hurts your firm and is probably one of the prime reasons why you can’t find and land top talent.
Competitive Analysis V. Benchmarking
Many recruiting functions participate in benchmarking studies, where researchers seek out best practices from other firms. Although benchmarking is important, it’s not the same as the competitive analysis required to build a competitive advantage. This is because benchmarking finds out what the “best” firms are doing, but does not necessarily find out what your direct competitors are doing.
Because a firm might only compete in a limited geographic area or in specialized jobs, it might be more beneficial to know precisely what your direct talent competitors are doing.
Competitive analysis is a side-by-side comparison between your firm and your direct talent competition in each of the critical talent-management areas. Competitive analysis focuses on both comparing recruiting and talent-management performance results as well as identifying best practices, strategies, and weaknesses.
Best practices information might indeed help your firm improve your performance at some point, but first you must identify whether there are any performance differences between your firm and its competition.
The Art of War
The best recruiter I know has achieved his level of excellence by viewing recruiting as a competitive battle. Not only does he track what the competitors are doing but he has also held quarterly recruiting roundtables where he invites all of the best recruiters in the geographic area to share ideas and best practices.
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Why does he do this? He does this because he thinks one of the best ways to beat an enemy is to know them and keep them close. By talking to them on a regular basis, he is able to judge what the best are doing and then use that information to keep one step ahead.
Learn From Other Competitors
It’s hard to learn about competition from HR people because, almost without exception, they don’t view HR as a competitive function. However, within every company there are fierce competitors that you can learn from.
The best place to start is in sales. Talk to sales managers and you’ll learn very quickly how to develop and maintain a competitive advantage. The sales departments’ approaches will invariably seem too aggressive at first, but over time, you learn that you have to be aggressive to win a “head-to-head” competition.
Other highly competitive types that you might learn from include advertising, product development, and product branding professionals. In my experience, the tools, strategies, and approaches are almost always directly transferable to the talent-management function.
The War For Talent: Counter Your Enemy’s Actions
If you’re a fierce competitor and you want to practice competitive advantage recruiting, here are some action steps you can take to identify and then counter your competitors’ recruiting actions:
1. Countercyclical hiring. The key here is to hire right before the competition begins a major hiring cycle. For example, if they do most of their recruiting on campus in February, do your recruiting in January, during the fall, or even during the summer.
If they do the bulk of their hiring right after their new budget cycle, you should begin hiring right before it or right after it. If they don’t hire during a recession or downturn, beef up your hiring to take advantage of this “off-market” time.
2. Hire when they’re not hiring. Identify when your competitor is not hiring and focus your hiring when the competition is minimal. Start by identifying from their website when they have gaps with few or no jobs listed. This might be just before their new budget cycle, during the holidays, or when they’re shut down between Christmas and New Year’s.
If they’ve just gone through a major merger or acquisition, take advantage of their inevitable confusion to ramp up your hiring before they get their act together. And of course, whenever they put on a hiring freeze, go to town.
3. Job descriptions. Most job descriptions are written in isolation and, as a result, they don’t provide competitive advantage. Most hiring managers make them up in isolation and then see them watered down by the job-analysis people in compensation.
As a result, I suggest that before you begin hiring for a position, visit your competitor’s website and see how your job description is superior or inferior. Talk to the hiring manager and show them how the content of jobs could be improved, so that when a candidate compares the two, they’ll see how your jobs are obviously more exciting and challenging. This also means doing some wordsmithing and testing so that in a side-by-side comparison, your jobs win out each time.
Next week: Part 2 in this series will introduce 14 more action steps for building a competitive advantage in recruiting.