Does the Recruitment Industry suffer from short termism?

I read a blog post and the content got me thinking about the recruitment industry and how much of it appears to be very short term in its outlook. I don't mean to generalise and I know there a lot of good agencies who don' t take this approach, but a lot do.

Clearly recruitment businesses are there to make money - but I think the focus is too much on the generating fees rather than delivering a good quality service. For me its always been the case that if you deliver a quality service then the fee/income takes care of itself.

Focusing on fees over service, leads to a short-term approach which I think is an unsustainable way of running a recruitment business. Depending on the size of the recruitment business (i.e. with your larger recruitment organisations) it may be sustainable but will undoubtedly have an impact on your reputation.

So, why do recruitment businesses have such a short term view? Perhaps they don't actually set out to be short term but there are many factors which either directly or indirectly lead them to follow this
path.

Here are some of the things which I think lead to a short-term approach in recruitment:

Too much focus on sales/revenue targets - in their own right targets are no bad thing and do provide focus and a clear idea of where you want to get to as an individual and as a business. However recruitment businesses need to give more thought to what goes on in the process to achieve these targets. (i.e yeah its great to make a placement but if in the process you haven't actually done a very professional job, and its at the expenses of establishing a more valuable medium/longer term relationship then is it worth it?)
Lack of quality - there's a lot of focus on speed of response within recruitment. Yes its important but not at the expenses of doing a proper job. Throw cv's at a client hoping one candidate will hit the mark isn't a good long term strategy. It might get you a fee but how often will it work, and the client will soon go elsewhere for a better service, if all they receive is a cv forwarding service from you.
An inability to establish client commitment - I have seen many consultants (and have done the same in my earlier days within recruitment) speak to a company/manager who says they have a vacancy which other agencies are working, but are happy to receive some additional cv's. The consultants rushes off knowing they are already up against it, sends some cvs across and hopes for the best. Does the consultants really have the commitment of the recruiting organisation to use them? Is this time well spent? Have they cut corners to get cv's across because they are already behind their competition?
Clients - Yes clients need to look at how they deal with their agencies. You can't expect a good service if you don't give agencies enough information or time. Also by using multiple agencies you in effect create a cv race which ultimately diminishes quality. Clients also need to know how to deal with agencies; often HR professionals who aren't recruiters give the impression that they will use an agency when in fact they won't and they should just be honest and say so. (unless you are very clear with recruitment agencies they will assume there is a chance of business with you; which will most likely make things more difficult for you in the future)
Inexperienced consultants - to often recruitment businesses let inexperienced consultants loose on their clients or prospective clients. I think they can struggle to provide the quality of service
due to their lack of market knowledge and experience. This can be frustrating for businesses using the agency and therefore reduces the likelihood of a longer term relationship being established.
Anyone can work as a recruiter - currently it's too easy to be a recruiter. I'm not saying it should only be for certain people, but currently the industry falls short of some of the other professions
like accountants, surveyor, architects etc who need to meet much
greater levels of examination before they can operate within their
respective industries and under their professional bodies. This 'ease
to entry' attracts people for the money and creates massive competition
which I believe leads to lower standards.

So whilst I think many recruitment businesses can be very short term in their approach to recruitment with the focus being too much on fees; I also think there are other factors, as illustrated above, which
contribute to this short term approach.

Do you think the recruitment industry suffers from short termism?

Alex

NB. this article was originally posted on my blog: www.alexonrecruitment.co.uk

Comment by Leigh Cosgrove on January 4, 2011 at 10:00am: Brilliant blog post ALex! I have been saying this for years, there is far too much emphasis on driving sales and aquiring new clients and not enough on building relationships. This can leave clients (and candidates) feeling like yesterday's free newspaper. The real question is will it ever change?

Comment by Chris Hofstetter on January 4, 2011 at 10:25am: I do believe short termism exists but the clients promote this idea by not treating recruiting firms like professionals. Thus independent agencies feel "what's the point" and become a resume clearing house since they see other firms doing the same and grabbing a fee here and there. Client companies should realize that if they give the agency the time of day are respond in a timely fashion there will be a much higher level of serviceability. Search firms, like anyone else, need encouragement otherwise they will just work on a volume basis and hope for the best.

Regards, Chris Hofstetter/CTH Corp.

Comment by Michelle Chan on January 4, 2011 at 11:02am: Alex, totally agree with you that many consultants focus on fees rather than quality service and it can be short term; having said that, I know of many of these consultants have made their many hundred thousands in recruitment business and they are in the business for more than 10 years. It makes me puzzle, whether fees or quality service is important to our client. To say this, I must admit that I am a new consultant and I am learning from everyone.

Comment by Alex Brock on January 4, 2011 at 11:20am: Thanks for your comments.

Leigh - Agree with your thoughts and yes I think it can change but needs to be driven as much by the client side of the relationship, which leads nicely onto Chris' comment

Chris - absolutely agree with you; this is the point I have made many times and therefore good to hear you and therefore others share the view that clients too need to change the way they operate.

Michelle - I agree you can be very successful in recruitment but the recruiting world is changing and therefore whilst histroically you could do well in the industry whilst not being focused on 'too' much on quality I think this will change. Social media, Direct attraction by clients will mean there is a greater emphasis on agencies/consultants standing out from the crowd and providing a value add & quality service. There will always be a need for recruitment businesses but i think quality will be a much greater focus. All the best to you.

Comment by Jerry Albright on January 4, 2011 at 11:41am: I'm not seeing why there has to be a distinction between focusing on quality and being concerned with the bottom line. I do both.

Comment by Thabo on January 4, 2011 at 12:05pm: The problem is across all industries in terms of short term thinking. I agree with your point though as you touch on professionalism in the industry being the problem. Engagements between recruiter and the client/ candidate tends to be very much like chewing gum which to me is not sustainable. Those that are in it for the long haul will look to build their personal brand by developing real relationships and servicing the client as required (well at least that is my approach and the rest of the team). Those that are just in it for the buck are always looking for the next better deal. We choose our clients carefully and work with people that believe in what we are doing rather than the commoditised approach where I have seen companies throw vacancies at a whole lot of recruiters and watch them wrestle like dogs to a bone! I have comfortably walked away from people who want to use me as a transactor rather than some form of sustainable partnership.

Comment by Alex Brock on January 4, 2011 at 12:24pm: Jerry - agree you can do both and for me that's how it should be done. However there are many recruitment agencies/consultants who just focus on bottom line and therefore forget the quality.

Comment by Slouch on January 4, 2011 at 12:40pm: I may be missing something but if you are a recruiter and you have a big bottom line, would that not mean the quality of the candidates you recruit are good?

Comment by Jerry Albright on January 4, 2011 at 12:54pm: I'm with you Slouch - I just can't see how any recruiter/agency can stay in business (or even survive a few months) without being concerned with quality.

I can't even picture sending an invoice without having performed some type of "satisfactory or better" service for my client. Throwing unqualified resumes to a client? Is anybody actually making a living
doing this?

In my experience the vast majority of recruiters simply provide "adequate" service. Few even go so far as to visit their clients regularly. Many just make the placement by somehow dragging up a
candidate who fits. They send the invoice. The invoice gets paid.
They may or may not ever do business again.

Are they dismissing "quality" in their service? Not necessarily. Can they bank on future business? Not necessarily......

Comment by Sandra McCartt on January 4, 2011 at 3:58pm: Here is the rub. What is a quality candidate/service? It has become obvious to me that what is quality to one company may not be to another.

ie; i place a lot of accountants with public firms. Even within a 200 mile radius a candidate who is quality to one firm, another would not touch with a ten foot pole.

ie: service..some clients think it's quality service if we find them a candidate and leave them alone. They are barraged by phone calls from recruiters who tell them, "we are different, we provide quality service".

The take is that this brand of client does not want to talk to you five times a day or even a week. They feel that you provide quality service if you find them three candidates, set up the interviews, prep the candidate, shut up sit down and speak when spoken to. I have several like this that have called me for years because i do what they want done, when they want it done and leave them alone. Others want to talk about every candidate for an hour before they even decide on a phone interview. They consider it quality service if i am available to speak with them three times a day and stay with the process through salary negotiations and keep them posted on employee feedback for 6 months.

Since candidates, clients and recruiters come in all different flavors each will seek their own level where the interaction is profitable and successful for all parties.

It's my take that the bottom line is what keep recruiters in business, how one gets to the bottom line depends on what the client wants and how they want it done.

Quality like beauty is perhaps in the eye of the beholder.