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Why Recruiters Are Worth What TheyCharge

04/09/2012 13:08:00

“When I need a heart by-pass, rest assured that I won’tselect my surgeon on the basis of what he charges.”

That’s what anailing executive recently opined when he was informed by his doctor about hisarterial blockage problems.

Why then arecorporate executives so tightfisted when dealing with what is so commonlythought of as the “heartbeat” of their companies . . . top-talent?

Companies thinkvery little about paying the often excessive fees charged by their outside accountingand legal firms . . . or even to the gaggle of consultants who promisecost-cutting and streamlining miracles in other areas of operations.

Yet, when facedwith brain drains, talent deficiencies or the need to replace one employee witha better one, their thoughts too often turn to parsimony. This K-mart mentalitybelies and contradicts their stated objectives to “hire the best,” especiallyat pecking order levels below the “big picture” executive suite inhabitants.

Of courserecruiting fees can vary from firm to firm but, when they do, you will almostalways find that those on the low side are sure to exclude some very keyingredients of the process, all of which are vital to providing theindispensable services necessary to satisfy the needs of the employer.

So why arerecruiters worth what they charge? Just a few of the often unspoken reasonsare:

Expertise – Nobody knowsthe employment marketplace better than a professional recruiter . . . nobody!In-house human resourcers, no matter how effective, view the marketplacethrough an imperfect or misrepresentative prism and tunnel vision is theiroccupational hazard.

Just asphysicians are cautioned against treating members of their own families, so toois it folly for an in-house H/R professional to believe that they have anundistorted and unbiased picture of the employment landscape. They arevulnerable to the pressures of internal politics and cultural dimensions whichdo not hinder the outsider.

Street-smartrecruiters already know the neighborhood, including the unlisted addresses sooften overlooked by the insiders.

Cast a wider net –A professional fisherman will always have more to show than a weekend angler.Recruiters are in the marketplace day in and day out. They know the unfishedcoves, reefs and inlets that are unknown to others. The job-hunter bookshelvesare filled with lore about the “hidden job market.” The same holds true forprofessional recruiters who have a detailed roadmap to the hidden talentsources which will never be accessed by newspaper ads, alumni associations,applicant databases, job boards or any of the other more familiar sources ofpeople.

There areoccasional pearls through these sources (and someone inevitably wins thePublisher’s Clearinghouse Sweepstakes too) but you have to shuck an awful lotof smelly oysters to find them. Recruiters only give you oysters proven tocontain pearls. Your only job is to determine which pearl is the best.

Want to catchwhat you’re fishing for? Hire a guide!

Cost – There is amisconception among employers that the cost of a hire equals the cost of theads or Internet postings run to attract the person hired. Nothing could befurther from reality.

Try addingthese to the true cost and you’ll see just how cost effective an outside recruitercan be:

Salaries andbenefits of the employment/recruiting staffs plus those of the line managersinvolved in the hiring activity (who are not productive in their normal jobpursuits when they’re out recruiting); travel, lodging and entertainment expensesof in-house recruiters; source development costs; overhead expenses includingbut not limited to telephone, office space, postage, PR literature, applicantdatabase maintenance, reference checking, clerical costs to correspond with thehundreds of unqualified respondents, etc.

Unbiased third party input– Contrary to what some believe, recruiters don’t try to put square pegs intoround holes. A recruiter’s stock-in-trade is their integrity and theirreputation for finding someone better than a company could have found forthemselves.

For a mid tosenior-level executive, the average recruiter may develop a “long list” of ahundred or more possibilities. Each must be called and evaluated against theposition specifications as well as the personality “fit” with the company andthe people with whom they will ultimately work. Once this is winnowed down tothe “short list,” an even more intensive interviewing process begins to narrowthe search to a panel of finalists for review by the client.

This process isnot, as some believe, simply romping through the file cabinets, harvesting fromthe Monster lookalikes or putting the job opening out to others on therecruiter’s network with crossed fingers that someone good will show up.

It is highlyunlikely that a professional recruiter will be plowing new ground with youropening. They deal within spheres of influence far more familiar with yourneeds than any internal recruiter and, more often than not, view the finalistsas people who are competent to solve client problems rather than just fill anopen slot in the organizational chart.

Because theywant to do business with you again and again, they are looking for (andchallenging you to excellence by hiring) the “truly exceptional” rather thanthe “just satisfactory” so often settled for by in-house hirers.

Confidentiality –Advertising or otherwise publicly proclaiming an opening, aside from its costand demonstrated ineffectiveness for sensitive senior level openings, oftencreates anxiety and apprehension among the advertiser’s current employees whowonder why they aren’t being considered or worry about newcomer transitionproblems. Just as often it alerts competitors to a current weakness or voidwithin the company.

Speed – The recruitingprocess is always faster through a search professional who is continuallytapped into the talent marketplace than one having to start the process fromscratch. For every day that a key opening remains unfilled, a company’s otheremployees must grudgingly do double duty. And this doesn’t factor in the profitopportunities or competitive advantages lost to a company because a positionremains unfilled or is done on a part-time basis by others less qualified.

Post-Hire Downtime –Not only is speed an essential part of the professional recruiter’s process,the ability to locate a person who can immediately “hit the ground running”with a minimum of “ramp-up time” saves time after the hire. All too often, ahire selected through less effective sources offering a smaller talent poolrequires several months of expensive training and orientation.

Reality – Professionalrecruiters often recognize and have a duty to inform clients that they may bemistaken as to the type of person sought, the salary required to attract themor the possibilities that the solution might just lie in areas outside thetraditional target industries . . . something an internal recruiter ispolitically disinclined to do. Too many hirers fail to understand that aprofessional recruiter’s primary function is not necessary to fill a slot butto provide the right candidate to solve a problem.

Negotiation –Master negotiator Herb Cohen says that, “negotiation is the analysis ofinformation, time and power to affect behavior . . . the meeting of needs(yours and others’) to make things happen the way you want them to.” As abuffer and informed intermediary, the professional recruiter is better able toblend the needs and wants of both parties to arrive at a mutually beneficialarrangement without the polarizing roadblocks which too frequently materializein face-to-face dealings.

Prioritizing company resources – It is often amazing to see how much of a company’srevenues are squandered on non-productive perks for existing high-levelemployees while they penny-pinch on what is every company’s lifeblood . . .talent acquisition.

Clubmemberships and the like may be fine, but no one with an IQ higher than ForrestGump’s believes that these expenditures substantially contribute to a company’sprofit margin. But one well-placed employee can be the cause of a company’sprofits skyrocketing. And the fee for having hired these people pales toinsignificance when compared to the contributions they make to the bottom line.

The next timeyou think a recruiter’s fees are too high, put them in the proper perspectivebefore asking for that Blue Light special or spinning your wheels thrashingabout trying to fill vital openings with less effective (but not necessarilyless expensive) pedestrian methods. Savvy executives learned long ago that thefee paid to a recruiter is a shrewd strategic investment, not an extraneousexpense. They also know that the “best” is far different from the “best available.

10 Commandments of Supply Chain Management

03/25/2012 00:13:00

We are taking a survey and want to know what you think.

Please comment - what do you consider to be the 10 Commandments of Supply Chain Management. When responding, please identify your focus (i.e. strategic, indirecct, MRO, CAPEX, etc.)

We'll gather all your comments and provide lists by category of all responses received.

Thanks for your input!

Untapped Value

02/09/2012 14:48:00

I was in a meeting the other day with several peers from a large corporation and one of the topics discussed was tapping in to smaller suppliers. Past research data has shown that large companies stick with large suppliers and small companies utilize smaller suppliers.

As we talked, we identified a number of reasons why this happens, the most prevalent of which is the obvious - size compatibility. It seems that like-sized company counterparts feel more comfortable (and productive) in day-to-day business relationships because of sophistication synchronization, similar financial structure and finally, policy/procedure guideline issues.

In a large company environment, as it turns out, a surprisingly high number of cost savings are never realized because of existing agreements with pre-determined pricing and discount structures. This is not a bad situation if you look at a "global" view of an entire organization, however the inevitable trickle-down is that a department with a limited budget often has no choice in the matter and after several notable purchases, someone has to walk the red carpet and petition for more money. Never a pleasant task.

How do you get around this? Well, that's not an easy task but it is definitely not an insurmountable goal. One way that we are all familiar with is the use of the almighty "P-Card". Lately though, I've heard that spending limits are being reduced so the incentive for spending outside traditional approved supplier base is vanishing.

Another, more innovative way - do the research needed to identify small cottage-industry companies offering goods or services that can provide the favorable cost/benefit to your organization. Lets face it, today is still a Buyer's Market and there are a significant number of resourceful small companies just waiting for the opportunity to unseat an incumbent supplier. These companies tend to have less of an overhead and can be more competitive on a one-off purchase or even a long-term deal. There is a short-term down side - that is training a new company. Sometimes painful but the upside is you have the opportunity to mold a company into exactly what you need them to be.

Like I say to my clients - "An RFP doesn't cost anything, but value proposals can save you money!

Help support small businesses. After all, our great country was founded on small business owners!

Reinvent

01/21/2012 15:09:00

About 10 years ago, I was gainfully employed by a nationally recognizable and prestigious Construction Management company. The division I was affiliated with consisted of mostly alpha-males who were all highly-intelligent, highly-skilled in their respective specialties and all very highly-strung. How I got there is anybody’s guess but that’s a story for another time.

We were focused on managing the company's portfolio of clients whose manufacturing operations required new capital expansions that were one-off type projects utilizing processes based on cutting-edge technology. In the initial phase of each project, we all saw the same goal, but from different vantage points. That in itself is a desirable business model, however consensus on execution strategies rarely came without a bout of jumping up and down, rolling around on the rug, stamping of feet, questioning each other's lineage and finally the realization that we had all just violently agreed on a solution. A few of those sessions and one is ready for the loony bin!

Being the astute and venerable father-figure of the group, our fearless leader decided it was time to channel all this wonderful energy (before we could cause great bodily harm to each other) and sought help from a Professional Development Coach, Mr. Brian Cooke, Founder and Senior Leader of Iris Learning. I specifically plugged him because I firmly believe every dynamic company can greatly benefit from his program.

After participating in a number of sessions with Brian, we started to understand each other’s perspective, to the point where we would finish each other’s sentences. As a team, we went on to accomplish a number of successful project deliveries; and as individuals have become ultimately more effective leaders in our business community.

A key element of the lesson plan was to focus on the bottom line, never to accept status-quo and to constantly re-invent ourselves!

Focusing on the bottom line and never accepting status-quo are relatively easy disciplines to master and maintain but learning the art of self-reinvention can be a challenge. If you’re anything like me, folicly-deficient and physique-challenged by gravity, you understand that each passing year brings on another slight degree of IDLC (I don’t like change).

I spoke with Brian the other day and we both agree the economic climate isn’t what it used to be and probably won’t ever get back to what we consider “normal” so I guess it’s time to plug in the “Re-inventamatron” again!

“Good times, bad times . . . you know I’ve had my share”

02/04/2011 14:46:00

That Led Zeppelin song keeps resonating in my head when I think about the economic conditions that drive a Buyer’s Market vs a Seller’s Market.

Being in the Procurement profession for a significant portion of my career, I’ve seen a number of both – relishing in the good times. Buy-downs, Savings and Value-Added Reports were relatively easy and the performance rewards, well . . . “Life was good”!

During the bad times, however, well we all know what that’s like – Tums, Ambien and/or the additional Martini at (not so) Happy Hour.

Conversely, I did a short stint as a Business Development professional – a rare and fortunate experience for a tried & true procurement guy, one that I have come to appreciate, having learned that Sales is not as easy as it looks from across the table. You see, a few years back, a good friend told me “Joe, you’re nothing more than a salesman trapped in a purchasing guy’s body”. I thought about that for a while and figured that I’d seen virtually every sales technique . . . “how hard could it be”?

Well, I’m here to tell you, my forehead is exactly plumb after having doors closed on it and from the occasional banging on the walls as a release from frustration. I am, however, proud to say that I did enjoy a good measure of success as well! Being allergic to pain, that career tangent was short-lived and I’m back on the reservation and in my comfort zone.

Now that I have returned to the Supply Management side of the business, the knowledge gained has become invaluable and not in the sense that may immediately come to mind. Sure, it’s useful to have a better insight in to the tactics, strategies and motivations of a sales professional, however I keep the presence of mind that while times may be good for me, he or she may be stopping by the local drugstore picking up the prescription for nighty-night pills.

Being fair with Suppliers in your good times goes a long way in your bad times, 9 times out of 10 your counterpart will reciprocate!

The Speed of Lightning

02/01/2011 13:36:00

Ever wonder how fast lightning travels? Did you ever care? The USA Department of Energy gives the speed of lightning as 93,000 miles per second, which maybe a 'rough guide' figure based on the 'half the speed of light' principle!

In business, we are all familiar with the term Efficiency Optimization. This is a non-stop effort aimed at continually improving performance of a given process, function or procedure. The general goal is to have things moving "lightning quick" thereby saving time, money or whatever other metric you are focused upon. Achieving the desired result usually means we have reached the pinnacle of success - or does it?

How much faster would lightning go if you took the "zig" and the "zag" out of the equasion? What would happen if we changed the atmospheric conditions? There are also a number of other factors that we could touch upon and there would be variations, tangents, etc. for each scenario.

The only constant in business (and life) is change. The only way to manage change is to stay ahead of the curve. The only way to stay ahead of the curve is to anticipate change.

Wind in the economic sails

01/23/2011 23:10:00

It seems that lately there really are signs of life for those of us involved in capital projects and hopefully this won't just be another short-lived spike. As capital funding is approved, the pressure will mount and with current bare-bones staff, now is the time to start the search to round out your project organization chart. There's still a lot of "A" team players on the market but as the economy starts to recover, available resources will dwindle. CSM can help you with your staffing needs, we maintain a database of resumes and we have an extensive network to help you with your needs.