Are Recruiters Really Necessary?

Peter was a great candidate: Fine background, good skills, terrific references. So I decided to spin the dial and see if I could place him.

After a little research, I found a company that seemed a perfect match for Peter’s talents. So, I placed a call to the vice president.

The VP agreed that my candidate was indeed perfect, and could immediately help his company grow. However, there was a catch: Under no circumstances would they pay a recruiter’s fee.

“So, you see no value whatsoever in working with a recruiter,” I said.

“You got it,” he said, cutting me off. “We get 50 resumes a week from posting on Craigslist. So, if your candidate really wants to work for our company, I’m sure he’ll find us.”

“Sorry I wasted your time,” I told the VP. I could tell from his tone of voice that any attempt to convince him otherwise was a waste of my time as well.

Things Get Complicated
Just as the VP predicted, Peter eventually found the company online, and after an exchange of emails, the VP flew him out to interview. Not once, but twice.

Soon after the second interview, Peter received an email from the VP, and it had the look and feel of an offer—almost. “We’d like you to come to work for us,” The VP wrote. “All we need to do is find out what sort of salary you’re looking for.”

I know all about the email, because Peter had forwarded it to me and asked for advice.

Now, I’m not one to hold a grudge; nor am I about to keep two interested parties apart, especially in light of the fact that the candidate was unemployed. So I advised the candidate to strongly state his interest and request a formal offer, with the understanding that if the offer was reasonable, he would accept the offer and set a start date.

But instead of taking my advice, the candidate took a detour, which proved fateful. In the email message to Peter, the VP went on to say that their salary range was $100k to $150k. Since Peter’s last job had paid $100k, he figured there was some room to negotiate.

So Peter emailed the VP that he needed more money to: [a] compensate for the higher cost of living where the job was located; [b] bring his salary up to “market” value, according to an online survey; and [c] provide him with a 6-percent increase to adjust for inflation during the two years he’d been unemployed.

Want to guess how the VP reacted? He pulled the offer.

I don’t blame the VP for being put off. But instead of saying, “Whoa, can we talk about it?” he took the sleazy way out. He wrote back that after careful consideration, his company actually didn’t have an appropriate position at this time. Which, of course, was a total lie.

Maybe Next Time
Had I been in a position to broker the deal, I’m certain the outcome would have been very different. Ambiguities, concerns and expectations would have been dealt with confidentially, and a smooth and orderly consensus would have been reached. Instead, Peter and the VP communicated in the manner or two dry sponges rubbing against each other; and as a result, our little drama morphed into a triple tragedy.

First, a talented and deserving candidate still has a family to feed and a creative mind that’s going to waste. True, he overplayed his hand. But that was more a reflection of inexperience than greed or malicious intent.

Second, a perfectly good company that could have reaped untold financial benefit by expanding its capacity is still turning away business.

And third, the VP who regarded my services as worthless not only let his penny wisdom and pound foolishness cost his company ten times the money he would have paid me; he also stuck a sharp stick in the eye of our country’s economic recovery.

So, the next time a company tells you they can’t afford a recruiter, you may or may not win the war of ideas. But at least you can state your point of view—that in fact, they can’t afford NOT to use you—with utter and total conviction.

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Replies to This Discussion

Permalink Reply by Sean O'Donoghue on August 11, 2011 at 10:53am

Excellent points you made there Bill. I whole heartedly agree...

It doesn't matter how many social media trainers show companies how to recruiter effectively by themselves, or how many RPO's try to offer on site services, or how many companies think they can recruit purely on their own... At the end of the day, the candidates will never be able to get the VERY helpful advice, insight and assistance on making their next career move without using an agency.

Going forward, I really do feel that the only way we'll be able to prove that companies need to use us, is to show them outright that candidates feel FAR more comfortable having a dedicate 3rd party advisor handle their next career move, rather than going direct to a company. Of course, there are many candidates who've had bad experiences with agencies, and that's certainly why they feel the need to go direct to employers. It's thus very imperative that we educate both clients and candidates on the REAL values behind both of them using an agency to make their next hire / job move.

If we can form very close relationships with our candidates (not just our clients) - then it will be us left holding all the aces... and companies will have no choice but to use our services. Also, lets not forget that no one is better placed to build a strong passive pool of candidates than agencies - as that's what we're best at. A client only has one company to offer them - and thus there's no way candidates will stay loyal to that company whilst they are passive - they want to see the entire market, exploring all the best opportunities available to them in the future... and that's where they will always need us.

Companies right now just need to justify our fees - and it's up to us to justify ourselves. Those who are good at that will most certainly come out of this recession stronger than when they went into it. The poor agencies who have gotten by on over charging clients whilst providing a very average service will most certainly find the climate right now very tough indeed.

Good luck to us all!

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Permalink Reply by Tim Spagnola on August 11, 2011 at 10:53am

Bill - thanks for sharing this story. It is great to hear your voice in the RBC (as always), but I agree with you fully. You might not always win the war of ideas, but it is worth standing your ground and trying to present the reasons on how you can bring value to the organization. I was also encouraged to see that you were willing to continue to offer advice to the candidate even though the client closed the door. We are after all in the people business and it is important to not lose sight of that either. Great read!

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Permalink Reply by Steven G. Davis on August 11, 2011 at 10:58am

Bill,

Thanks for sharing, how true, how true. You are correct we will not always win every battle, but sooner or later they do come looking. What a shame in this situation. I am sure you wanted to jump right back and say..."hmm and you don't need me..how'd that work out for ya!!!" Onward and upward..

Thanks again

Steve

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Permalink Reply by Brian K. Johnston on August 11, 2011 at 11:13am

BINGO! Note to self: ONLY work with people who respect my line of work, and there are plenty of them!!!

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Permalink Reply by Leslie Wilcox Hughes on August 11, 2011 at 11:30am

Thanks for a great story to tell those who "Don't use Recruiters" thanks to Craig's List.

I wonder if the VP does his own colonoscopy? Used equipment is probably available on Craig's List along with instructions. A perforated colon, bleeding and infection or possibly death shouldn't dissuade him from saving all the money he'd pay a Gastroenterologist and hospital for their services. An intelligent and wise person knows that they have limits on their abilities and they seek help when needed. I wonder how many thousands or millions of dollars of new business the candidate would have brought the company with his talents? I'd have to call that VP back and finish the discussion - after I'd placed the Candidate. I'd either turn him around and get his business or I'd leave him with a gnawing headache.

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Permalink Reply by Bill Radin on August 11, 2011 at 11:37am

Dear Leslie:

You make a great point (with a powerful analogy). I've pretty much stopped doing missionary work, especially when it involves trying to teach a pig to sing: "Don't try to teach a pig to sing. It wastes your time and annoys the pig."

Take care,

Bill

Leslie Wilcox Hughes said:

Thanks for a great story to tell those who "Don't use Recruiters" thanks to Craig's List.

I wonder if the VP does his own colonoscopy? Used equipment is probably available on Craig's List along with instructions. A perforated colon, bleeding and infection or possibly death shouldn't dissuade him from saving all the money he'd pay a Gastroenterologist and hospital for their services. An intelligent and wise person knows that they have limits on their abilities and they seek help when needed. I wonder how many thousands or millions of dollars of new business the candidate would have brought the company with his talents? I'd have to call that VP back and finish the discussion - after I'd placed the Candidate. I'd either turn him around and get his business or I'd leave him with a gnawing headache.

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Permalink Reply by Irina G. on August 11, 2011 at 11:53am

I agree with you, Brian. Even thought we are in a service-oriented profession, we don't have to put up with disrespect. It always makes me wonder how some recruiters can put up with so much from their clients just to please them because "at the end of the day, I make money", they say. Yes, you have money in your bank but at what cost? I am strong believer that moral standards should not be compromised. .... just a thought.

Great article. I read it a couple of days earlier on Bill's website. Thank you for sharing.

Brian K. Johnston said:

BINGO! Note to self: ONLY work with people who respect my line of work, and there are plenty of them!!!

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Permalink Reply by Mat von Kroeker on August 11, 2011 at 11:55am

It isn't a coincidence that on this relatively small of a level, ego's destroy all the good that can come about--- and on the largest scale conceivable, US Congress and the President of the United States, ego's destroy all the good that can come about. Regardless of upbringing, education, "civilized behavior", moral & ethical stance-- when $$'s are added to the equation--- with man's unbridled propensity towards greed and avarice-- associative yang being "frugality to a fault", "you ain't gettin' mine" mentality, human being's continue to be just as stupid as if we walked out of a cave last week. I guess I should thank my lucky stars, I still have the motor skills to wipe my own as.s.

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Permalink Reply by Amy Ala Miller on August 11, 2011 at 12:29pm

Thanks Bill, I totally agree. It's no different internally. Even as a corporate recruiter I still have these conversations with my candidates to avoid exactly this situation. There's too much at stake between egos and misconceptions to leave salary discusions between hiring managers and candidates. I didn't check my recruiter brain at the door when I took an in-house position.

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Permalink Reply by Jeff Battinus on August 11, 2011 at 1:31pm

I left the staffing industry some time ago, weighing the cost/benefit of taking the massive pay cut to the long term benefits of going “corporate”. I was fed up with poor recruiters and unethical agencies giving me a bad rap although I only held myself to only the highest standards. Unfortunately, on the other side after several years in corporate recruiting my decision has been validated in a variety of ways. I have found that in almost every case, agencies tend to “throw it at the wall to see if it sticks”, over coach candidates, and poorly represent my company diminishing our reputation as an employer of choice.

I find value in outside good recruiters; however the industry as a whole has become putrefied by a majority of bad apples who have ruined the staffing industry as a whole. In most cases Staffing firms have tended to cost me more time and money than the return on investment warrants. Now one of my personal core competencies is “agency spend reduction”.

By hiring a strong internal recruiter, compensating them well, and encouraging their growth, there really is no longer a need for a company to expend resources on external staffing vendors for direct placements. For the cost of 10 placements, a company can hire a highly productive FTE to make 50-100 quality placements a year with the company’s best interests in mind while having an expert to train internal hiring managers on best hiring practices. This is a 500%-1000% ROI in year one for the company, not to mention the residual benefits of organizational development.

In short, recruiters are still necessary, just not the external vendor recruiters.

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Permalink Reply by Julie Link on August 11, 2011 at 2:01pm

Great example! So many companies just see recruiters as resume-forwarding services. However, we are instrumental in the screening, interviewing, negotiating, and placement process!

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Permalink Reply by Jeff Battinus on August 11, 2011 at 2:37pm

That is not what I stated, I am sure there are as many bad internal recruiters as there are external. What I am stating is that the majority of agencies and recruiters out there are not representing themselves appropriately, and out to get that "low hanging fruit". An external recruiter has a vested interest in making a placement fee, whereas the internal recruiter has a vested interest in their company. When I re-negociated all contracts to have a 120 day guarantee (which was my standard contract when I was an external recruiter), you would be amazed how many agencies cried foul, unwilling to stand by their product.

Bill Schultz said:

@Jeff- I find it odd that you are able to find such worthless external recruiters and such wonderful internal recruiters. After all, they are usually trained in the same place. My thought is that you are not taking the time to partner with the external recruiter.