Groundhog Day

When Robbie Cowling was motorcycling to his Basingstoke workplace from his home in Essex and each day passed on the other side of the road a motorcyclist going the other way, the thought occurred to him that if the other guy was an IT contractor like himself and they swapped jobs they’d save themselves both the 3 hour commute!

Robbie goes on the found Jobserve and become one of the architects of the single most significant event in recruitment history; the introduction of the Job Board. Whilst the move from print to digital significantly reduced the cost of attracting candidates, it did not however change the agency process – Groundhog Day.

The basic process is the same whether you’re in executive search or recruiting temps: take a job description, source possible candidates, identify the best candidates and introduce to the client. It is usually transacted by a small group of recruiters and may involve a very large and far-flung group of potential candidates who need to be “identified” (relatively easy), “approached” (time-consuming) and persuaded or “engaged” (tricky).

The reason the recruitment sector reminds me of Groundhog Day is that (with some exceptions) each time an agency takes a brief it starts the process from scratch. This is arguably because the candidate market is in a state of constant change and the best available candidate 6 months ago may not be the best available candidate today. This is where the “consultancy” in Recruitment Consultancy comes.

However…

Collectively the estimated 100,000 recruitment firms in the world know virtually all the candidates in every market “personally”. They’ve all been contacted! Every SAP Consultant in Spain, every Lawyer in Israel, every Accountant in Australia, every Engineer in the UAE has been identified, approached and engaged! The gold’s not buried! It’s all been mined and is selling in the market. All you need to do is find the right Recruiter that’s already got the right Candidate.

In the same way as someone living in Essex and working in Basingstoke doing exactly the same job as someone living in Basingstoke and working in Essex makes no sense, so too does the concept that the traditional highly engineered approach to recruitment is the only way to use the agency sector. There’s a massive resource of existing relationships out there that you could tap into in a matter of hours.

http://vacancy-clearing.com

Now seeking business partners to act as Associates (sector experts) and Country Managers (distribution channel leaders). See website for details or email david@vacancy-clearing.com 

Work for us and build a new global recruitment model

The agency recruitment model has not changed much in 25 years. Employers choose agencies they feel confident will represent them correctly and can deliver the candidates they need. The process uses a small number of agencies (a PSL or preferred supplier list) to break down a large potential candidate market and deliver the best available hire.

The problem with this PSL model is:

1. There’s a chance a small number of agencies will not find every candidate,
2. It often takes a considerable amount of time to engage and deliver candidates,
3. It’s expensive compared to other options now available to Employers.
 

The PSL is the backbone of the market and is where the “Consultancy” in Recruitment Consultancy comes from BUT,  I believe we need to also offer Employers alternatives.

Vacancy-Clearing.com is a unique recruitment agency introductory service

We can introduce an Employer to the Recruiter that we know already has a relationship with the best available andidate for the Job. See website for the How!

1. It has great geographically reach because it’s online and is open to all agencies,
2. It’s fast because these Recruiters are not looking for candidates, they’ve already got them,
3. It’s low-cost because there's no cold-calling or candidate sourcing involved.

The Opportunity: Country Manager and Associate.

We’re now looking for Country Managers in all major recruitment regions (UK, Germany, Australia, Hong Kong, UAE, USA and others) to build and manage teams of Associates (sector experts) across all the major agency recruitment markets (IT, Finance, Legal etc).

Associates will take charge of a particular sector reflecting their expertise (eg Accountancy/UK) and be responsible for: promoting V-C through Social Media, selling to existing and new contacts, screening CV traffic on all advertised jobs and managing agency feedback.

The model anticipates 1 Country Manager and up to 30 Associates (1 sector expert for each market). You will receive a substantial monthly share of advertising revenues generated by your sector/country. Unfortunately we’re not able to offer a salary as we’re a start up.

If you’re interested in a new venture and you have the required agency recruitment background and would like further details please drop me an email to david@vacancy-clearing.com

How to overcome agency sector fragmantation

 

As I result of reading this interesting piece from NPA I thought the membership debate might enjoy another perspective.
http://www.npaworldwide.com/2012/05/24/3-key-diferences-npa-bountyjobs/#.T79HQlL-6qw

With 10,000 firms in the UK alone with an average size of 5 Consultants each (if you remove the big players that average number of Consultants is even lower) it’s not surprising that one of the first words used about the agency market is “fragmentation”.

The problem with the market being split into so many small suppliers is that it becomes inefficient: lots of firms cold-calling the same employers, pitching the same candidates, advertising the same jobs, tripping over themselves to secure revenue, being almost invisible when you want to find them and with virtually zero inter-agency communication.

From an employers perspective this fragmentation creates problems too. If they want to cover the markets from a geographical and sector basis and they want the best agencies on the job (arguably the niche independents) they’ll need to appoint quite a few of them. However this might only equate to 1 or 2 Consultants per job group (eg Finance roles in the UK or IT in Spain) , which in a tight global skills market be like trying to download video without broadband.

The independent recruiter is the backbone of the industry but we must find a way to reduce operating costs, improve efficiency and increase communications if we are to compete. One solution would be for agencies to form or join groups, which could coordinate the activities of its members more efficiently without threatening their independence. By joining a group you automatically raise your profile, build buying power, create a new business channel and open up a communications with other suppliers.

Apart from the obvious ones like the IOR, APSCo, REC etc I thought it might be useful to start a list. Please add any you can think of in the comments section

Why your recruitment business has zero resale value and what we can all do about it.

 

Unless you’re a Michael Page your recruitment business is worth nothing should you decide to sell it: which is a great shame because you spend years of blood, sweat and tears to get it going and even if you hired a few Consultants it’s worth little more than a couple of Rec2Rec fees if you do manage to off-load it when it’s time to move on.

There’s a very simple solution that I would ask the IOR to consider picking up and running with.  Licensing!

I have long advocated limiting the number of agencies that can operate in the market at any one time. At the moment anyone can open an agency from their bedroom tomorrow. Some would argue that the market will decide who lives and dies. That’s true but for years it hasn’t stopped the random emergence of agencies of all kinds of quality. There is a way to manage this situation for the benefit of all current owners in a more decisive way.

Think Black Cabs v Unlicensed Cabs and you’ll quickly visualise the problems and solution.

Nearly all the problems that beset the recruitment sector can be traced back to over-supply: volume cold-calling, CV spamming, poor training, corner-cutting , contingency fees, PSLs etc. If there were 5,000 licensed agencies in the UK instead of the widely touted 10,000 unlicensed ones, the average agency income would rise by 100%, the balance of power between client and agency would shift towards the agency and your licence would be worth something when you decided to get out.

Think about it.

How we go about Licensing will follow in another Discussion.

Agency Recruiters need to appreciate the benefits of collaboration.

 

It’s not uncommon for agencies to refuse client work because it’s not quite in their area of expertise. Equally a recruiter can source 10 good candidates knowing only 1 can get the job the rest are discarded.

Imagine you had 2 people on the road: the first is thirsty and the second is hungry. A passerby offers the first a sandwich which he throws away and another passerby offers the second some water which he too discards. A small shift in attitude and communication and everyone would be a lot better off.

This is an area of recruitment that is crying out for change.

Recruitment Consultants are not in the business of serving the interests of other Recruiters. However they are presumably in the business of doing good business and in order the optimise profitability it does make sense to collaborate at some level as the travellers and their benefactors should have done.

This can be achieved quite easily by setting up an independent “clearing house”.

Jobs that come your way but don’t match your expertise should be steered towards the clearing house. Candidates you spent time and effort contacting and engaging could also be placed through the clearing house.

It’s difficult to estimate how big this market might be but let’s try.

If there are 50,000 recruitment consultants in the UK alone and each advised their clients to post 5 jobs per annum (ones you would otherwise discard) on to the clearing house that would equate to 250,000 jobs or on average 5 extra revenue earning opportunities per annum for each and every consultant in the UK.

Remember that these jobs would otherwise almost certainly be lost to the market. The value of this recycling: well you do the maths...£1 billion?

The key is whether Recruitment Consultants can work collaboratively?

Why recruitment is a sales job, why that’s wrong and what you can do about it.

I had a conversation about salesmen and commission/bonus recently. It was actually about Investment Bankers but the principle applies to all jobs where a significant proportion of your income depends on making a sale. The conclusion was that salesmen have an “unhealthy” interest in the outcome of the process.

In recruitment where the product is a person/career/livelihood this unhealthy interest in the outcome of a candidate introduction is universally recognised and simply wrong. Candidates don’t like it, Clients don’t like it and even many Recruitment Consultants don’t like it! So why do we put up with it?

The short answer is over-supply: Too many agencies, chasing too little business.

If there’s not enough to go around, suppliers start to compete on price and eventually you end up with firms “winning” commission-only contracts.

In addition whilst Clients moan about agency fees being too high they must remember that the current model forces agencies to take all the risk. The cost of hiring via agencies could be much lower and outcomes more satisfying if Clients paid well-chosen suppliers less on results and more on effort and expertise.

That’s where we need to get to.

Getting there will take more than reducing the number of suppliers but that’s the start point. To do this you’ll need to split the supply side into “them” and “us”. The “us” will be made up of agencies that start to evolve rapidly through diversification of products and services and up-skilling their consultants.

Those that make up “them” will wither away as Employers start to recognise the benefits of “us” and the dangers of “them”. Those that remain will embed their Consultancies deep within their clients’ structures, they will charge fees geared more to time spent, they will belong to a representative body, agree to a code of conduct and carry a badge showing how and why they are different.

Once there is balance between supply and demand and bearing in mind it’s likely to be the best that survive, agencies will still win new Clients by “selling” their services but will earn revenues that are less dependent on “selling” candidates to clients and clients to candidates.

As always it’s your opinion and observations I’m after.

Imperfect model.

There's a shortage of Talent and the current model used by both In-House and Agency Recruiters is a long way from perfect. Filling roles does not mean you’re getting the best candidates it sometimes reflects low expectations.

This recruitment model is not perfect (though little in life is) because you’re asking a small number of Recruiters to identify, engage and deliver the “best” candidate from a potentially large, shifting and sometimes evasive pool of candidates. Done properly this can take months of man hours or fees.

And what is “best” anyway? Many Recruiters (In-House and Agency) will not be able to connect with all possible candidates so “best” is inevitable “of the ones we could find and persuade to engage”.

There is however a potential solution! It works a bit like a search engine.

If you want to find a webpage that contains the information you’re looking for you use a search engine and it presents you with a list ranked in order of relevance.

What if you could do the same in a recruitment context and find Recruiters that already have the Candidates you’re looking for listed in order of relevance?

Uniquely only Agency Recruiters can offer this because unlike In-House Recruiters, who are tied to one Employer, Agency Recruiters can make their Candidates available to any Employers.

In the changing world of recruitment this unique selling point is worth debating particularly in the context of a possible shift away from a Client-led to a Candidate-led agency model (like Sports Agents).

Agencies need to modify their proposition retaining Consultancy where it has commercial value and embracing other propositions that offer a unique competitive Agency advantage.