Why on earth would an employer choose to use the services of a recruitment agency?
- To find the best person for a job (well d’uh)
- Because the employer has no idea where to look
- or where to advertise
- or how to identify suitable candidates
- or how to even approach a likely candidate.
- Because the employer doesn’t have the time to recruit
- or the inclination to go through the tedious process at all (can’t be arsed syndrome).
- Because the recruiter has intimate knowledge of their industry sector
- and an extensive network of contacts and hidden candidates
- and will represent the employer ethically and professionally.
Most agency recruiters would agree that an employer should recruit for at least some of their vacancies themselves, without needing to engage external expertise. The easy jobs, for example. As recruiters, we can’t help but wonder when we are given the easiest assignment, why the employer doesn’t simply do it themselves? “Money for old rope” is the phrase that comes to mind when arranging interviews for an overpaid job, with a popular employer, and an undemanding line manager. Full fees? No problem.
I think we can all agree that these particularly low-hanging fruit are far rarer these days, and getting much more so, as in-house recruitment teams are cherry-picking the plum tasks. (Aside: That’s three of my five a day sorted). There are of course many more reasons than the ten listed above, but we know that agencies are mostly given the really tough-to-fill vacancies, and usually after all other channels have been exhausted. Let’s face it, agency recruitment is often viewed as a costly last resort, and HR managers would prefer to chew off their own arm before paying a substantial fee – especially when their boss expects them to be good at this stuff.
This presents a serious problem for any recruitment firm. Their model has always been predicated upon a placing candidates in a mix of easy and hard to fill vacancies. In contingency recruitment, the fees for the successful assignments cover the cost of time, effort, and advertising for the vacancies which are never filled. If an agency only ever has tough jobs to fill, it had better be bloody good! Let’s face it, any amateur recruiter can land an assignment to find Purple Squirrels and Unicorns. If they even exist, they’ll be a bugger to find, and just as hard to pitch a new job to.
So how can any agency, and their recruiters do, if they plan on being in business for the foreseeable future? I believe the key components are these:
- Billing models
- Granular level market knowledge, and networks in niche sectors
- Recruiter and agency-level talent-pooling.
Firstly, the current billing model for contingency recruitment is ridiculously out of date and unfit for purpose. Any fee based on a percentage of salary is an arbitrary and illogical measure of value. Employers expect a whole range of services, but we insist on only billing for the core introduction of a candidate. Frankly, we stick to this because we are used to it and lack the imagination or bottle to challenge it. By doing so, we also back ourselves into a corner and have to make greater concessions on fee guarantees, and laughably absurd Service Level Agreements just to keep to that 20% fee. If a recruitment firm delivers any kind of service which the employer values, then it must be charged for. (I won’t list them here, as you’re smart enough to work them out).
Secondly, your recruiters should almost literally throb to the heartbeat of their individual market sectors. Every specific market sector has a finite number of employers and players. A niche sector is a living breathing thing, with limbs, organs and a pulse. Every recruiter must immerse him or herself entirely in their sector, and get close to every potential client, candidate, passive or hidden candidates, administrator and janitor in their area of expertise. It’s not easy, but it is essential. They must make it their business to be the go-to person for any piece of gossip, rumour, promotion, firing, and hiring in their realm. I can’t think of a single reason why they wouldn’t want to know this stuff. The more you know your market, the more your market knows you. This kind of recruiter is invaluable, and very attractive to both employers and candidates.
Lastly, we come to talent-pooling. This follows naturally on from the last point, in the ability to have the rich and unique knowledge-base that gives any recruiter a competitive advantage. Some employers have been doing this for years, and it can really work in certain circumstances. For recruitment agencies however, it is an absolute no-brainer. We now have access to huge swathes of information on individuals, companies, deals being made, industry events, professional bodies, online groups, and informal associations between people. Social media channels, industry databases, blogs, forums, directories, credit information etc etc, mean that we have all the tools we need, so long as we add a little imagination and a soupçon of brass neck. (Brass neck? Recruiters? Really?). Recruitment agencies, and even individual recruiters absolutely must take a leadership role in the sectors they service. Make noise, be known, learn from everyone, and soak up all of that information which will make you an invaluable resource. Attend every event you can, even arrange your own events, engage directly with your market, and it’ll engage right back. If candidates and clients don’t know who your recruiters are, then what use are they to anyone?
In next week’s truScotland event, on Thursday 17th September, I’ll be discussing this very topic, alongside a star line-up of recruitment industry experts at the Hard Rock Café in Glasgow.