Dear Claudia,

I’ve made placements with a small company for years that didn’t have an HR function. Mid-last year they were bought by a much larger company with a recruiting department, and the rules for third party recruiters are changing. They’ve asked me to sign a new agreement that basically says before any candidate can be presented to a manager the resume must be submitted to a central HR administrator who will verify they aren’t already in the company ATS. We have no direct access to the database, so no way of verifying what is true and what isn’t; they say it is a non-negotiable clause for doing business together. Is it time to say goodbye to this client?

Getting the Shaft


Dear GTS,

I’m not so sure you really are getting the shaft, but here’s a suggestion: buy yourself some scuba gear because the water’s gonna get a whole lot deeper while you’re learning how to swim with the sharks. Clearly the company can state their terms of doing business together, and clearly you can choose not to play; but you built a great relationship of trust with the first company over time, and another way of looking at this is that you now have a chance to extend that relationship on a much bigger scale.

It’s not easy to work with big companies, and especially not during periods of transition when it seems like red tape and turf-building rules. But the truth is that after a point the nimble, wild-west behaviors of a start-up become counterproductive to continued business growth, and the age of operational efficiency arrives. Everyone learns the mantra, or moves on: do more, do it better, do it with less. From my perspective you’re sitting in the middle of this profound opportunity as a third party recruiter, and the only thing missing is a relationship of trust with the new sheriff in town. Maybe it’s time to brush off your Valentine’s Day skills and start treating this old friend like you’re dating with intention again.

Only you can decide if you need to say goodbye to this client. At the same time, only you can decide if you want their business badly enough to work harder and win it for a second time. Good luck with that.

**

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I know I sound like a broken record but what more/better reason do you need to telephone source? NOT ONLY will you reach the 90% of the candidate base that is not already tucked inside their ever increasingly powerful ATSs but you will run a huge flag up your own poles declaring your independence. Try it. You might like it. And if you don't like the actual challenge of phone sourcing find someone who does!
******
Looking for information on phone sourcing? Read through the T and TH Phone Sourcing Classroom Chats over on the MagicMethod network. They’re listed in the Blog Posts section and are identifiable by the yellow talk bubble that says “MagicTalk”.
You go, girl!

Maureen Sharib said:
I know I sound like a broken record but what more/better reason do you need to telephone source? NOT ONLY will you reach the 90% of the candidate base that is not already tucked inside their ever increasingly powerful ATSs but you will run a huge flag up your own poles declaring your independence. Try it. You might like it. And if you don't like the actual challenge of phone sourcing find someone who does!
I hope Jerry doesn't come in with the big finger. Or maybe not.
;)
You know Claudia, I've been thinking about this since I first saw your post this morning. These companies are really wielding some big sticks these days and I see this behavior over ATSs as abusive. It neeeds to be addressed. I asked what folks were doing about it over on MagicMethod but I'd like to ask the same question here. It's coming up more and more these days. I'd like to hear the viewpoints of HR.
Claudia, to your point...

"You built a great relationship of trust with the first company over time, and another way of looking at this is that you now have a chance to extend that relationship on a much bigger scale."

Unfortunately, this doesn't always translate in reality.

I can think of many instances where a relationship was built over time that had no significance when one of the parties scaled up. How about the local bank that was swallowed up by a super regional that itself saw the signage change as it too was acquired by a national conglomerate?

True the teller might be the same person you've dealt with all along but I've seen in exactly similar situations how employees themselves can become resentful, unable to adapt to an overhaul in systems, procedures and all that. Relationships change for everyone when an organization morphs.

But we still have choices. GTS should accept that the old relationship is now no more. If the terms being dictated now are not their liking, walk away. We are treated the way we allow ourselves to be treated. It seems to me that this is a case of self-shafting.

Maureen, two points...

First, I have it from a reliable source that Jerry is posting "the finger" on all posts that he deems to be spam and should be getting around to February 2009 at around 1:30ish PM ET tomorrow. Hopefully, you'll get a job order in the next 20-minutes so if he tries to finger you can remove the offending entry and still get ahead.

That said, I sent Jerry an email telling him that you've been in my system since August 2006 so there's nothing in it for him if he does nobble you. As it happens, I just double-checked and it looks like your information hasn't changed...

Maureen Sharib
Telephone Names Sourcer
TechTrak
513 899 9628

Next, the question of hands-off candidates and ATS databases. It should be a non-issue.

If a viable candidate exists in the database why hasn't HR identified them and started recruiting them themselves? It seems to me that is a good enough reason to use a third-party, when you're own systems fail or your internal people are overwhelmed.

The hands-off should be on the basis of the candidate being in play with HR or any recruiter has already submitted them -- SOP ain't it? -- not that the person in question also happens to be some poor lost soul in Peoplesoft purgatory. If the candidate is in play that should be easy enough to verify if you're in touch with them too, no?

Again, we have choices.

If an a partner wants to play "it's my ball whether you like it or not" find a partner that you can work with on the basis of mutual respect and understanding. It is not without reason than organizations gravitate toward organizations that are like they are. That's why we have global staffing firms that have contracts and clauses and "my database is bigger than your database" globe-trotting executives and, at the other end of the spectrum, mom-and-pop agencies that complain they just got shafted when dealing with "faceless" corporations.

Maureen Sharib
Telephone Names Sourcer
TechTrak
513 899 9628
That's an interesting point, Maureen -- my experience leading corporate recruiting makes me think that it's less about abuse than about setting down rules of engagement before paying a fee; internal recruiting departments often own the budget for hiring costs (including fees to TPRs), and have limited internal resources to police this activity. Additionally, if the company has invested the tens (or hundreds) of thousands of dollars on an applicant tracking system that is tied to an equally expensive career website, the pressure is on to make sure that every additional dollar spent is absolutely necessary.

That said, I also know companies that have put these kinds of rules in place to punish the bad behavior of one agency or recruiter, and it's painful to watch. It slows down the process to be sure, and tends to underscore the perception that internal recruiting/HR provides more administrative assistance than competitive differentiation.

Maureen Sharib said:
These companies are really wielding some big sticks these days and I see this behavior over ATSs as abusive. It neeeds to be addressed.
I like the 90 day rule -if you don't have them in play or talked to them in last 90 days they're in my play. On the extreme (and I 'd be a tough negotiator to let it push out this far) it might be pushed to 180 days but THAT'S IT!

You can spend all the money you want on the toys but if you're not workin' it girl it just don't matter.
;)
Ami, straight to the heart of it, as usual. I agree that GTS should make decisions based upon what is, and not what was, and if the terms are unacceptable you're right: the only sensible solution is to move on. The challenge lies in knowing when it is time fish or cut bait with a client; if it were me, I might be inclined to play by the rules while building and maintaining new and old relationships with hiring managers. At best I'll be on the vendor list and pick up an extra search or two; at worst, I won't make any placements but will build a network that I can tap into for placements elsewhere. After all, if they're not a client they're a source, right?

Amitai Givertz said:
GTS should accept that the old relationship is now no more. If the terms being dictated now are not their liking, walk away. We are treated the way we allow ourselves to be treated. It seems to me that this is a case of self-shafting
Maureen Sharib said:
You can spend all the money you want on the toys but if you're not workin' it girl it just don't matter.
;)

Ain't that the truth? :)) It's just bad form to engage a TPR before you've eliminated all other options, unless you're also willing to pay the fee for someone they present (how about that for checks and balances in the contract?); I actually fired a recruiter once in part because she consistently made an issue of vendors that were presenting candidates that were already in our ATS - only thing was, she never knew they were there until the HM wanted to interview them...
The ATS excuse is a poor one. There are lots of negotiating tactics you can try, but they won't get anywhere if you can't get a meeting with someone senior enough to make the difference.

Start like this.

1) How up to date is your database? If you have the resume of someone who applied 10 years ago for a job as a PC tech, but they are now an Oracle developer, do we get credit? Why or why not? Is it just the name in the database, or is it the resume? We can screen people by when they submitted their name, but since you can download resumes without ever talking to someone, you could have the entire US on that list. How about we say if the resume has been submitted in the last 6 months? 1 year? We can screen out candidates that way.

2) What about contact info? If you have someone's name, but not their current phone number, would we still get credit? If you have no way to contact them, how would you ever be able to recruit them?

3) If we submit a name to your company, and it's a really good fit, but you have it in your database, how will you react if we place that candidate elsewhere? What if he/she interviews, and we find ourselves with a competing offer? Will you have an issue with us taking that candidate away from you?

None of this is as good as pointing out that having a name in the database is not the same as recruiting them. You can try the old Fordyce Letter trick of bringing a phone book, and asking them if they've downloaded those names and numbers, but your point is to build a constructive dialogue with someone who can make a difference.

Sadly, most of these rules aren't in place out of fairness, and the companies aren't concerned with anything but squeezing their vendors. Every placement they get that you found is free money for them. The HR rep in this case would get a slap on the back and a good job, and the candidate wouldn't necessarily care. And if you balk, there are plenty of firms willing to do anything to get in the door.

I'd say ramp up your sales staff - and find clients that still need your help - but at least make the effort to see if the client is reasonable.
Jim, as usual - nothing but net. :)) Really valuable input for GTS.

Jim Durbin said:
The ATS excuse is a poor one. There are lots of negotiating tactics you can try, but they won't get anywhere if you can't get a meeting with someone senior enough to make the difference.
"But the truth is that after a point the nimble, wild-west behaviors of a start-up become counterproductive to continued business growth, and the age of operational efficiency arrives."

For a counterpoint, this is the 'trap' many organizations fall into; the point that they lose their path and forget how they became who they are today . . .

And for a period, the oft-singular, Keynesian focus becomes appeasing Wall Street (considering they, in fact IPO'd) . . . until they realize that making short-term decisions under the guise of 'efficiency' does more harm than good over the long haul.

This happens until growth becomes stagnant and investors no longer drool like they did during the early years . . . and the company then pays high-priced management gurus to come in and re-assert a culture of innovation and "Jack be nimble, Jack be quick . . . " We read press releases and see presentations of the original founder coming back to "return the company to its roots" (i.e. Steve Jobs). Or, at a given point, the CEO sees the real threat -- commoditization. Just ask Starbucks CEO, Howard Schultz.

And even with this knowledge, us TPRs can do little to buck this always usual & predictable evolution. We either get in where we fit in, or we are labeled 'non-conformers'.

We decide who we will dance with . . . and who we turn down to instead hit the bar for another drink ("because it's gonna be a long night" . . . )

P.S. Don't just take my word for it. Here is an excerpt from Howard Schultz's letter above:

"Over the past ten years, in order to achieve the growth, development, and scale necessary to go from less than 1,000 stores to 13,000 stores and beyond, we have had to make a series of decisions that, in retrospect, have lead to the watering down of the Starbucks experience, and, what some might call the commoditization of our brand.

Many of these decisions were probably right at the time, and on their own merit would not have created the dilution of the experience; but in this case, the sum is much greater and, unfortunately, much more damaging than the individual pieces."

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