The desire to become more strategic is one that has been espoused by recruiting leaders for more than a decade, and yet, year after year, newly introduced initiatives seem more tactical and administrative than ever. Recruiting processes have nearly doubled in size when you look at the steps involved, but no one seems to think or can prove that output has changed all that much. When you look at what the typical recruiting organization actually does, the plain truth of the matter is that 90 percent of the work is administrative or tactical at best. There’s nothing wrong with tactical work; it does for the most part generate a positive return in the short term.
But let there be no doubt that a truly strategic recruiting function would do a fraction of what typically gets done and a lot more of what hasn’t been getting done. Strategic actions have broader, long-term dollar impacts that manifest themselves by fundamentally altering an organization’s capability or capacity to compete. Little of what gets billed as being strategic these days is actually strategic. In fact, it seems that the word “strategic” in conjunction with recruiting is most often used by vendors selling goods and services that have absolutely no strategic impact. The next time you see an advertisement from a vendor that uses the word strategic, do yourself a favor and use it to get the kindling started in your next fire!
Most Recruiting Activities Are Not Strategic in Scope
Almost everything that an individual recruiter does is intended to resolve an immediate need and is therefore operational or tactical in nature. Because the scope of the outcome is so limited, it is nearly impossible for any single instance to rise to the level of being strategic. For example, the following activities are generally always focused on resolving short-term needs:
- Requisitions development
- Job analysis
- Employment advertising/job posting
- Career fair participation
- Candidate sourcing
- Candidate screening
- Candidate assessment
- Offer process coordination
Why Not Step Back and Do Something Strategic? The New Year is a great time for senior recruiting managers to take a step back and think about devoting a significant amount of their time to real strategic initiatives. Managers cannot be satisfied with improving upon last year’s activities and results if they’re going to be strategic. Instead, they must also anticipate and plan ahead for upcoming trends, such as a continued shift to global recruiting, an increase in turnover by as much as 50 percent, and increased pressure to be more “businesslike.” If you’re one of those managers who think that recruiting is going fine and doesn’t need to change, there is no need to read on. However, if you want to make dramatic improvements in your recruiting results and are willing to try some truly strategic things, here are some action-items that I recommend you take.
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Strategic Action Checklist: 10 Things You Can Do to Make Recruiting More Strategic
- Focus on your external employment brand. There’s only one long-term recruitment strategy, and that is using a strong external employment brand image to attract applicants. I’ve found that less than 10 percent of major corporations have a written employment brand strategy and a staff devoted exclusively to executing it. Building your image by being positively talked-about in the professional and business press provides for a flow of high-quality applicants that will continue for years without the need for paid recruitment advertising. Employment branding works much like restaurant reviews and word-of-mouth: Once you get great reviews and a buzz among the population about how good your food is, you’ll attract patrons for a long period time without the need expensive advertising. Benchmark firms in this area include Google, MGM Grand, Wegman’s Food Market, Starbucks, and Yahoo. As a result, the number one strategic action that I recommend is assessing and putting together a formal program to become “talked about” in the media as a “well-managed,” great place to work.
- Develop a retention plan. Like it or not, turnover is increasing and will soon “get out of hand.” Now is the time to prepare for the return of large-scale retention problems (remember 1999?). Be ready for a dramatic increase in turnover, especially among top performers and in key jobs. If you don’t currently “own” retention, seize it now. Remember that if retention is ignored or done poorly, it has a dramatic impact on recruiting. Without focusing on retention, the recruiting function will have to work twice as hard to fill the vacancies that result from high turnover rates. High turnover rates will also damage your external image and make recruiting new top performers much more difficult. Strategic actions include first identifying which source(s) have the lowest turnover rates (generally referrals) and developing a plan to identify mission-critical positions and key individuals where turnover would significantly hurt the firm. Next identify the reasons why top performers stay and leave your firm. Resolve those issues. The benchmark firms here are Deloitte and GE.
- Stop procrastinating and finally measure the on-the-job performance of your hires (quality of hire). The fact that the Titanic recruiting director became famous for filling “every job at the lowest possible cost” is no reason to follow in his footsteps. Cutting time to hire and the cost of hire is certainly a good tactical move, but it makes absolutely no sense if you’re hiring people that 1) quit right away, 2) are average or below-average performers, or 3) began at a starting salary that is so far above average that it overcomes any purported “savings” that occurred with a “low cost of hire.” A CIO, CFO, or head of manufacturing would be laughed out of their offices if they instituted new processes and considered them successful without measuring the “quality” of the processes and output. In recruiting, not measuring whether newly hired employees turned out to be an above or below average performer is, to be kind, “unbusinesslike,” and it certainly wouldn’t be considered strategic. All strategic measurement approaches include five measurement elements (quantity, quality, time, money, and customer satisfaction). Recruiting must learn to measure and report each of them. Identify which “sources” (generally employee referrals) produce the highest on-the-job performers and then focus your resources on those sources.
- Focus on referrals. Not only are referrals great hires (one recent study completed by MIT’s Sloan School of Management conclusively proved that new hires generated via employee referral outperform all others), but they get produced via a process that frees up a great deal of recruiting time and resources for other strategic efforts. The benchmark firms here are Eli Lily, Google, Intel, Cisco, FirstMerit, and Booz Allen Hamilton.
- Prioritize your customers and your jobs. When budgets are tight, one of the smartest things any recruiting manager or recruiter can do to improve their performance is to prioritize their recruiting activities so that the most effort and resources are focused on the highest priority business units, jobs, and managers. Unfortunately, doing all recruiting at the same speed and resource allocation guarantees overworked and stressed-out recruiters as well as mediocre results. Action steps include first deciding that it’s okay to treat high priority customers “differently.” Next, identify the fastest growing and most profitable business units and reallocate budgets, recruiter time, and the very best staff to focus on the new priorities. The benchmark firms here are MGM Grand and FirstMerit Bank.
- Develop a talent management or workforce plan. Recruiting managers have “winged it” for too long. Literally everyone who is strategic in business (except HR and recruiting) produces and distributes multi-year forecasts and develops “if/then” scenarios for the most likely positive and negative situations. Although many recruiting managers say they have a workforce plan, rarely is it on paper or distributed. Recruiting leaders must begin to develop multiple scenarios and practice “what if” with their managers to ensure that they are ready for the most likely occurrences. The benchmark firms here are Microsoft and Shell.
- Test your systems with real inputs. CIOs and the managers of all customer service and business processes routinely “test” (at least once a year) their processes and systems to ensure that they produce satisfied users and outputs within acceptable quality/volume limits. Doing so requires using “mystery shoppers” to submit “perfect” resumes, utilize the website, and, yes, even go through interviews to ensure that systems are doing exactly what they are supposed to. One organization last year hired Bernard Hodes to do a “mystery shopper” study and found that the system worked as designed in only 12 percent of the cases. There are no benchmark firms because no one in recruiting has the courage to do more than just “assume” everything is working fine because “we have had no major complaints.” Recruiting managers should also consider a full “recruiting audit” in order to continually improve everything they do. Here, too, there are no benchmark firms because everyone is either naive or lacks the courage to face results they might find.
- Quantify the dollar impact of recruiting and talent management. Anyone who is strategic knows that the language of strategic people is dollars, specifically how much revenue and profit specific efforts produce. It’s time for recruiting managers to convert all of the metrics to business and dollar impacts so that everyone will know your impact on the corporate bottom line. Begin that process by building internal relationships with the CFO, and ask for help in converting metrics to dollars and in calculating the dollar differential in business impact of great versus average recruiting. I also guarantee that you will find that successfully making these calculations will exempt you from the mounting pressure to outsource the function. The benchmark firm here is FirstMerit Bank.
- Blow up the website. Recruiting managers must realize how ugly and dysfunctional their current corporate jobs/career websites have become and how they negate other branding and advertising efforts. A resume posting site with boring technology and generic information sends a clear message to top applicants that your firm just doesn’t get it. The benchmark websites that provide exciting information and convince people to apply are not found in recruiting, but in marketing and sales sites.
- Develop a written recruiting strategy. It seems so basic, but only 18 percent of recruiting departments actually have a written recruiting plan. It’s time to face up to the fact that you just can’t be strategic in business without a written and distributed strategic plan. Without a written strategy you can’t get everyone on the same page. In addition, research has shown that having a written strategy actually impacts business results. Benchmark firms include FirstMerit and MGM Grand.
Other strategic actions:
- Reward managers for great recruiting. Work with compensation to develop processes so that managers are measured and rewarded on how well they do recruiting and retention.
- Measure satisfaction. It’s no longer okay to assume that managers, applicants, and new hires are satisfied with what we do. Develop a process for periodically measuring satisfaction with all recruiting services.
- Develop a complete set of recruiting metrics. What you measure (and reward) in recruiting eliminates all doubt about what is important. Crucial steps in metric development must include measuring the performance of new hires and converting metric “numbers” to dollar impacts.
- Reward internal recruiters. It is a standard practice outside of corporate recruiting to reward results, but corporate recruiting managers seem to think rewarding “showing up and trying hard” with base pay is all that’s necessary. The reason that the average external recruiter is almost always better than the average corporate recruiter is at least partially due to the reward system.
Strategic things are hard to do, almost by definition. If something is easy, chances are it isn’t strategic. So if you want to be strategic, it takes the courage to “do the hard things first”! Any questions?