Incentivising Tomorrow's Recruiters - it's Feedback not Fees

Historically we have always seen 3rd party recruitment as a sales business. We employ recruiters who are rewarded for their ability to open doors and sell to clients and to place as many people as they can…irrespective of how they do it, and of what experience they deliver to their clients and candidates.

Social media is beginning to change that…whether on LinkedIn, Facebook or Twitter, recruiters now have a relationship with their candidates and clients which is both visible and transparent.

New articles and blogs appear on a daily basis foreseeing the end of traditional recruitment as we know it. Certain themes about the future landscape are showing through, with the clear messages that, post recession, there will be a need to develop deeper, more collaborative relationships with clients, and to pay more attention to building and engaging your candidate community, specifically the ‘Talent Puddle’, the top 10%, if you like, of that community.

Certainly the HR and Recruiting directors that I speak to (and as an HR recruiter I speak to a lot of them, as clients and candidates) are looking for something different from 3rd party recruiters in future.

How do you nurture your ’talent puddle’ if you’re only remunerated on placements?

Well, I don’t know about you guys, but I hate being sold to. If my career, and possibly the future income and stability of myself and my family, were at stake I know that I wouldn’t want to be sold to. Nor would I want think that the person who was advising and helping me was thinking of their bonus cheque and how I could add to it.

I would be much more comfortable, much more trusting, if I knew that their main motivation was in developing a long term relationship with me, and not how much they could make out of me.

Can you develop deep relationships with a bonus model based purely on rewarding sales?

And if I was a hiring manager, looking to build my team and fill some key positions, with a tight recruitment budget, and knowing that my neck was on the block if I screwed up in the hiring, well I wouldn’t want to be sold to either. Certainly I wouldn’t want to be relying on a recruiter who was only looking at how many fees they could get out of me.

I would certainly be much happier, much more trusting, if I knew that their main motivation, again, was in developing a long term relationship with me, and not how much they could make out of me.

How do you incentivise relationship building and service?

Difficult, isn’t it.

After spending many years as a 3rd party recruiter, including nearly 10 placing recruiters, I’m not sure that we’ve ever found a successful way of rewarding RELATIONSHIPS and SERVICE. We still look at volumes and values of placements, and usually still measure activity by volume. Great recruiters are defined by how much they bill, not by how valued their service is.

So how about using feedback as a measure?

Instead of paying your top recruiter by how many placements they make next quarter, try taking feedback from their candidates and clients on how they performed, and on what kind of service they provided? Did it meet or exceed expectation? And did they add real value to the process?

I think you may find surprising results.

Firstly from candidates and clients, who will now have some real input in what will become a true two way relationship, it will bring them closer and give them the opportunity to reflect and comment on your service in a transparent way.

And secondly from your recruiters, who will now be able to invest time and energy in really developing the service to their candidates and clients, taking time to nurture relationships, build their communities, find out what they really want, and create ways to deliver a real value added service. One that they can be proud of.

Who’s up for that challenge??

Comment by Will Branning on December 9, 2009 at 1:24pm: Good article. As someone who has worked as an in-house Corporate Recruiter and a third-party Recruiter for a combined 25+ years, I have an appreciation for both sides. I do keep in touch with candidates that I place and make an attmept to provide feedback of some sort to all candidates who contact me. It is a challenge to keep up on this, but I believe its the best approach.

It would be interesting to see employers offering a two-tiered fee - one for the initial placement and a second based upon placed candidate's feedback, and perhaps feedback from candidate's interviewed but not hired by the employer.

Comment by Marni Hockenberg on December 10, 2009 at 8:31am: Mervyn, do you work contingent or retained? I have worked both models in my career. The retained model allows for a higher level of customer service and increased level of candidate trust because the recruiter can take the necessary time to develop a good relationship with both parties. Candidates know that as a retained recruiter, I will be compensated for my time spent with them regardless of whether or not I place them with my client. They know that my motivation is to find the best candidate, not to place them in a job and collect a paycheck, therefore the quality of our relationship is higher and lasts a long long time. The feedback that I get from candidates is that they appreciate being treated like a human, not a transaction because I'm not competing with other recruiters for a placement.

Retained and contingent search fees are the same. Companies are surprised to know this, as they think retained fees are higher. But what they don't realize is that with retained search the customer service level rises on both sides and it achieves the quality that you talk about in your posting. Relationships are nurtured for the long haul because candidates remember that they were treated with respect, not with dollar signs in the eyes of the recruiter.

I agree tha