For fifteen years at OLIVER, a major part of my role was figuring out how to keep hiring good people.As Global COO, I travelled between 28 different countries, helping to build on-site creative teams for one Britain’s fastest-growing companies.Over time, three things became clear:
To me, this spelled a disruption opportunity.This spring marks the launch of Chapter 2, a business I’ve founded to help companies utilise their existing resources to reclaim ownership of their own talent operation, instead of paying recruiters to do it for them.Chapter 2 is the world’s first talent advertising company: empowering internal talent teams to attract the right people, and to reduce their dependence on recruitment agencies.The full details of what Chapter 2 does are on the website.For now, I want to share my own learnings from 15 years spent working on recruitment at one of Britain’s fastest growing firms, and help and inspire other businesses to achieve bigger and better things with their own talent teams.
The success we had at OLIVER was founded in proximity: creating better value from closer, longer-standing relationships.That was in marketing. So you’d have thought that talent, an industry founded on people, the relationship would be even more highly valued.The reality is the opposite.In every region, recruitment is characterised not by relationship-building, but by database miners and percentage fees.This has been a boon for recruitment agencies. In the US, the recruitment process outsourcing (RPO) market is set to double in size over the next 5 years.But is it good for firms?Apart from spiralling costs, the investment ends up on the wrong place. These transactional arrangements are effectively a pay-per-play model where the value is placed on a role being filled.The direct costs are high, and the opportunity cost even greater, as the company harnesses no recurring benefit or long-term gain.Firms are not to blame for the current state of affairs. At fast-growth organisations, hiring needs often spiral out of control. When this happens, recruiters provide quick access to pre-prepared talent databases.That need is never going to disappear. Nor will recruitment agencies. Generally, they find an employee who can do the job.But like many ‘good enough’ solutions, the relative ease of parachuting workers into roles risks distracting from its limitations.This is all the more frustrating because most large businesses have everything they need to operate self-sustaining recruitment operations: creative assets, digital infrastructure and – usually – in-house talent teams.But with the hegemony of recruitment agencies, in-house talent teams are broadly left disenfranchised, underfunded and under-skilled.
“…the battle for talent intensified—within and outside our industry. Many of the candidates we were pursuing were heading off to Silicon Valley, private equity, or start-ups… The wind had shifted from our backs to our faces, and we needed to respond.”[i]
Dane E Holmes, Global Head of Human Capital Management, Goldman Sachs.The challenge facing Mr Holmes will be familiar to most businesses: scrapping in an ever-more competitive market for employees.If a prestigious company such as Goldman Sachs is struggling to attract good people, it’s an indicator of just how challenging and competitive recruitment has become.This hasn’t always been the case. Until the 1980s, firms hired 90% of their roles internally, and before the gig economy, permanent employment used to be more of a draw.Being a big, prestigious company was enough.Now, however, job mobility is at record lows. The Economist reported at the end of the last year that, of those people who still want a full-time role, far fewer are likely to desire a switch.With fewer inbound applications, companies now hunt down ‘passive jobseekers’ – people who already like their current jobs - and offer them enough money to quit.
Source: LinkedIn.In consumer marketing, this would be called a ‘race to the bottom’. It’s a tactic deployed by industries such as supermarkets, where the proposition is so poorly differentiated, the only recourse they have left to dangle cash.This is madness.Companies are highly differentiated. They are places to socialise, learn and grow. Each has a unique culture and a unique set of opportunities to offer.Revealingly, a LinkedIn survey showed that there are plenty of ‘active jobseekers’ out there who are ‘passionate about their work’ and ‘engaged in improving their skills’ – but also ‘reasonably satisfied with their current jobs’.No ‘reasonably satisfied’ jobseeker will come looking for you, when recruitment agencies are handing them new roles on a plate.To attract the right people directly to your business, you need a marketing approach.
This is not just about employer branding.Chapter 2 has a brand. We produced a nice PDF, and we have zero expectations of it earning us any clients on its own.Companies are ‘reasonably satisfied’ with recruitment agencies, after all.Where our brand will earn us business is in connection with every element in our marketing operation: strategy, creativity, advertising and reporting – all designed to build a relevant audience around our business and pull interested parties into a conversation about how they can improve.Internal talent teams are likely to have to do this with little internal support.Marketers generally ‘don’t do recruitment’ (find me one CMO or creative director who’s really passionate about talent acquisition).And most businesses are loath to allocate marketing resource to hiring, when it could be more directly tied to profitability. Measuring a return on people is complicated.But that’s no reason to be intimidated by the task ahead. Talent advertising doesn’t need to be an inordinate new expense, or additional operational demand.You already have social channels with pre-curated audiences. How many of those brand advocates in your existing followings could also be highly productive hires – if they knew the company had the right role for them?I’ve seen first-hand that every business of any significant size has a content management system, stuffed with creative assets that could be repurposed for talent with relatively little creative versioning.Business have all the raw materials – they just need someone to connect the dots.You can pump out as much content as you like but it won’t guarantee valuable people will join your firm.The best place to hide something is on the internet. You can build the most beautiful careers page, but it you don’t use content to drive people to it, hold them in the ecosystem, and use technology to identify and capture leads, it’s a waste of effort.The most productive change happens when you apply a marketing mindset, and a wider arsenal of marketing assets, to a coherent process that’s optimised for attracting, capturing and onboarding new colleagues.The efficiency savings at some firms could run into the millions.A Oxford University study found that the upfront costs of hiring the average new worker exceed £5k; a further £25k is lost waiting for that new employee to operate at peak efficiency.Both sums could be reduced by attracting the right people, and doing so under your own steam.
The elephant in the room right now is coronavirus.It would be easy to fixate on the short-term disruption that every business now faces, and try to prophesy at what comes next.This would be a distraction.However things play out, long-term business trends indicate an urgency for companies to reclaim ownership of their own recruitment.Say we’re all still working from home in 18 months. That will mean employees leaving many more social impressions as they socialise and further their careers online.Technology has already had major implications for the recruitment space, automating the process and building robust ATS platforms. Social and digital channels have already been cleverly adopted by consumer marketing operations; talent advertising will be next.Or, say we end up facing a significant economic downturn – where more employees are competing for fewer roles.The last time this happened, it massively benefitted recruitment agencies, as companies outsourced the effort of sifting through deluges of applications.Far better to create a talent advertising presence which inspires and motivates the right people to apply in the first place.Or, say coronavirus produces a second wave of the ‘labour market scarring effect’[ii]: whereby employees, who entered work during periods of scarce employment, remain disinclined to leave secure jobs for years to come.Agencies can’t counter that problem, by making your company seem like a safe bet: dependable, sympathetic, or likely to offer fulfilling employment, job security and career growth.Nobody has a crystal ball. The point is, whatever problems show up, nobody is better placed to tackle them than your own recruitment team.By being over-dependent on recruitment agencies, this fundamental business function has stood fairly static while the world has grown around it.This was always expensive and unfortunate; today, it’s just unnecessary.From working at OLIVER, I’ve seen how quickly and effectively it’s possible to build a productive marketing operation. You do this by applying know-how, tools and tested processes to an existing business function, making use of existing assets and channels, and making them work harder for the business and the brand.There’s no reason talent teams can’t do the same.
Chapter 2 is the first talent advertising agency: empowering in-house talent teams to attract the best people, without dependence on agencies.We:
With the right tools and strategy, we aim reduce your cost of talent to below 9.5%.And by keeping it within your business, you gain the skills, know-how and tools needed to keep attracting the best talent to your employer brand.Visit Chapter 2 to find out more.References[i] https://hbr.org/2019/05/recruiting#expanding-the-pool[ii] https://www.economist.com/britain/2020/01/23/why-young-people-in-britain-arent-moving-job
