Ever since 2012 when I embarked on a project with a team of enthusiastic individuals to reinvent the way our business recruited people I have wondered one thing. Why don’t more businesses do the same thing? Over the course of the year, we completely removed our reliance on recruitment agencies, sped up the recruitment function by over 60% and save a huge amount of unnecessary cost. Granted we were operating in the O&G industry when oil was at its peak, so there was lots of activity and so lots of costs to save.

Our single largest cost globally was engaging recruitment agencies to find the people we needed. We were stuck in a cycle of paying large % of salary fees and in return it was taking us roughly 90 days to recruit people and we were being sent a huge number of irrelevant CVs. The surprising thing was it wasn’t even the agencies fault, it was ours. In many cases, agencies were operating through a PSL with seriously reduced rates and communicating with recruiters through enterprise systems like Taleo. All of this created a group of agencies competing with each other for reduced rate fees and in many cases, they could place the same people elsewhere at a better % thus making them more money. You can see why we needed to change.

Our team set about a project to completely reinvent how were recruited. Right from how we targeted ourselves, how we received vacancies, how we attracted people, where we advertised, how we received applications and how we engaged candidates right up until they were hired.

Having considered the project we embarked upon recently I now realise why some companies are reluctant to do the same. I am going to call this the Great Recruitment Chasm and the Strategic Recruitment Curve. In my experience, all businesses have the common goal to make money and the smart ones also aim to provide the best service possible to their clients. The idea of significantly reducing your recruitment cost and thus making more profit sounds attractive. Add to this the ability to attract a person that is more likely to stay with you business for longer allowing you to retain skills and knowledge, which in turn enables you to provide better more consistent service would appeal to most. So what stops most businesses from doing this?

The Great Recruitment Chasm

Over the past few months, I have been starting a business, developing our services. As part of this I have considered the theory of the Innovation Adoption Curve

The idea behind this adoption curve is that it can be relatively easy to gain your first adopter customers but the challenge comes with crossing the chasm and inspiring mainstream customers to use your services on mass. To do this you need enough traction to cross the chasm.

This brings me to the Strategic Recruitment Curve which was developed in collaboration with the members of the LinkedIn Inbound Recruiter group, a group of future focused recruiters leading the way in inbound recruitment. The Strategic Recruitment Curve compares the advancement of a companies recruitment function/strategy with the cost of recruiting people.

Stage 1 - The least strategic stage where agencies are used for most roles and the company also tends to employ recruitment administrators to manage the process.

Stage 2 - The recruitment function is becoming more strategic and many things can drive this first stage of strategic advancement. The cost saving can often be driven by reducing agency usage or better understand which recruitment channels are providing great value and focusing on these channels.

Stage 3 - The recruitment function has advanced to a stage where they are already providing significant cost savings but are still using agencies as they cannot seem to attract enough good quality candidates to take full ownership of the process. An RPO model is often involved in this stage where they manage the recruitment process and may engage external agencies when required, passing the additional cost to the client.

The Chasm - The chasm exists and sometimes acts a justification to not further develop a recruitment function as what happens if you fall short?

After all, there is already significant savings and the function has already come a long way. To cross the chasm a company needs a fully developed recruitment strategy which aligns to the organisations overall current and future strategy.

Often the biggest challenge to crossing the chasm is gaining the buy-in of your companies leaders.

Stage 4 - Having crossed the chasm the recruitment function has taken full accountability to deliver recruitment services. They have partnered with various other functions along the way including HR, Marketing, Communications, BD and Leadership amongst others. The function is now a true partner to the business. This can be delivered through outsourcing the recruitment process or through an in-house recruitment team.

Stage 5 - After crossing the chasm and as a partner to their business the function will now, over time, gain the benefit of being at the forefront of business as it changes and develops. Your colleagues will actively engage you ahead of time as they will understand how your function works and the information it needs to be able to deliver. As your strategy advances, through experience and learning, you will be able to deliver further cost reductions. To progress through this stage requires a strategic partnership and so outsourcing models will struggle. This is where an insourcing model can deliver added benefits.

Stage 6 - The utopia of recruitment strategy. All recruitment is done through the in-sourced or in-house recruitment teams who are trusted partners to the business. 

Do you agree with this theory or have you been a part of crossing the Chasm? Connect with me on LinkedIn and let's chat.

Iain Hamilton 

I have had the privilege of gaining a diverse array of experience in both in-house FTSE100 and recruitment agency style positions. More recently I launched People Traction. Check out our services here.

Throughout my career I have been passionate about providing a seamless and enjoyable application process and have lead projects to design company websites, careers sites and job boards.

I have been instrumental in creating and delivering global proactive recruitment strategies and training recruitment teams in how to pro-actively resource passive and active talent. The results of delivering a pro-active recruitment strategy have shown a significant reduction in time to fill, improved candidate quality and significant cost savings.

www.peopletraction.co.uk