The Recruitment Outsourcing Evolution: Are you keeping up?

Evolution: n.: A gradual process in which something changes into a different and usually more complex or better form. *Source: dictionary.com

Where it All Started

While outsourcing in the U.S. in general dates back to the 1800s, when wagon and ship sail production was outsourced to Scotland, the outsourcing of business services, such as staffing, really started in the 70’s and 80’s as IT companies began to grow rapidly. This initial outsourcing of services such as payroll processing quickly led to the outsourcing of accounting services, billing, payroll, collections, word processing, and finally staffing.

While IT companies blazed the trail, other companies quickly jumped on the bandwagon as the growth of the economy quickly outpaced the capacity and scalability of corporate recruiting teams. In addition, as the professional labor market tightened, it became increasingly difficult to find highly qualified candidates in the time frame that was demanded by business managers.

Before the development of the Internet and the subsequent boom in E-connectivity, the outsourced staffing industry was mostly a universe of order and uniform standards. There were contingency firms, retained search firms, temporary staffing firms, and contractor management agencies. While there was some crossover between these services within the staffing firm community, there was very little differentiation. The fees were fairly well fixed, the markups were fairly standard, and in the end, it usually came down to which vendor would be selected rather than which type of service was the best fit for the client.

Enter The Internet

In the mid to late 90’s, as Internet access exploded into people’s homes on a wide scale, services like Online Career Center (now Monster), Career Path (now CareerBuilder), Career Mosaic (later Headhunter, now CareerBuilder) and HotJobs (now Yahoo! HotJobs) emerged along with systems for sorting, tracking and searching for candidate profiles. When this happened, staffing companies began to thrive.

At this time, companies had not yet started to embrace the Internet as a recruiting tool. As a result, staffing firms were able to maintain their business models, while recognizing huge increases in efficiencies gained by having easier/less costly access to candidates. During that time, client corporations continued to pay traditional fees while the staffing firm’s cost to serve plummeted. As a result, margins soared and the staffing industry became an extremely profitable business.

Like so many other area of business, the widespread use of the Internet turned what was once order and standardization into a very complex arena. This hyper-transformation shattered all prior paradigms about when, where, and how outsourced recruiting could be used to assist in supplementing corporate recruiting efforts.

More Evolved Solutions

What used to be essentially four types of outsourcing has now spun off a slew of variations from the traditional staffing models. The end result is that companies now have a great number of options available to them. While the traditional models are still the primary models offered by most of the large, well-known staffing firms, the increased competition has been a windfall for companies looking for more scalable solutions for meeting their staffing objectives.

Though the traditional models of retained search and contingency staffing still make sense in some instances, more often than not, there are alternatives which are more tailored to the specific needs of an individual corporation or even an individual position. In addition, increased competition and increased options have helped to significantly drive down costs.

Like any other business, when new programs, products, or services are released into the market, the initial price point is very high. Then, as the market grows more saturated, and production techniques are stream-lined, the cost to produce drops and consumers realize the benefit of plummeting prices. A VCR in the mid-90’s cost $500 and up, and you can now get a combination VCR/DVD Player for less than $75.

In the same vein, where outsourced staffing for a position used to cost 25 – 30% of first year salary, you can now get a search (depending on how comprehensive the sourcing efforts) starting at under $1,000. And while cheaper isn’t always better, there are now extremely flexible and scalable solutions on the market that provide clients with a tremendous value at a fraction of the historical price points.

How to Stay Ahead

So, whether you are currently utilizing staffing firms and are trying to get away from them, are currently considering supplemental recruiting use, or are simply ensuring that you will be prepared as needs increase and capacity is stretched, make sure that you have a thorough understanding of your needs and the options that are available to you.

If your cycle time is much higher than you would prefer, or your recruiters are juggling more requisitions than they can keep up with, there are cost-effective solutions in the marketplace that can help. You no longer have to do a quick mental calculation of 1st year compensation multiplied by the number of positions multiplied by 25% when looking to outsource your recruiting needs. There are offerings that can provide the level of service that is right for you, at a price you can afford.

Be sure to do your research. Find a recruiting partner whose approach and capabilities were designed to meet your needs – instead of a prepackaged, one size fits all solution. You will most likely be pleasantly surprised.

Evolution: n.: A gradual process in which something changes into a different and usually more complex or better form. *Source: dictionary.com

In Conclusion

Market changes over the past 10 years have been anything but gradual, and the process has certainly become more complex. Fortunately for corporations, the complexity has created a better market with strong, focused solutions to meet any given recruiting challenge.

A Telescopic View of Online Recruiting

In many ways, it seems as though we have always had the Internet. Even for most of those who swore they would never get caught up in it, the memories of going to the study to grab an encyclopedia for a quick research question are distant. Everywhere you look and every thing you see is highlighting some sort of Website address. Virtually every aspect of life is being driven to one Internet destination or another. Whether you are ordering food, looking for a good book, banking, or buying insurance, everything can be done from the comfort of home via the World Wide Web. It is certainly no secret that people have been and are continuing to flock to the Internet by the droves. According to Pew Internet, 70% of the U.S. population is now on line, 50% of which have high-speed Internet access.

What does this mean to on-line recruitment? It means that you can get your job advertisement recruitment message in front of qualified potential candidates faster and easier than ever before. There are various ways of accomplishing this objective.

The first and most obvious way to use the Internet as a recruitment vehicle, is to make sure that you have an effective job board strategy in place. Job Boards such as Monster, HotJobs, and CareerBuilder along with niche and local sites are still and will continue to be the primary on line recruitment vehicle for most positions. With focus and singularity of purpose, job boards provide the most inexpensive method of getting your jobs in front of “job seekers”.

Before leaping out of the box to launch an assault on the passive candidates, it is important that an effective job board strategy first be employed. However, while job boards are the best vehicle for reaching “job seekers”, they are not going to help reach those ideal qualified people who are the perfect candidates, but are gainfully and happily employed. Loyal, hardworking, effective people often have great job security and don’t have the time or the desire to browse job boards.

Attracting these types of people is where it takes the same creativity and targeted profiling that have been used by corporate giants in America for years in marketing their products or services to potential customers. There are various methods for utilizing the Internet to reach potential candidates: targeted email campaigns, buttons, banners, tiles, skyscrapers, “pop-unders”, etc., and those are just the basics. A great thing about the Internet, is that as it has developed and grown in functionality and popularity, so has the sophistication of the tracking and profiling capabilities used by the various Websites. What this allows for, is getting your message in front of only the candidates you are wanting to target.

There are various techniques for establishing exactly what that profile is, but a few have proven to be more effective than others. One of the best of these techniques, is through the construction of profiles based on the most successful individuals within your organization. This is far from a new concept, but exactly what type of profile you are building is very important. For the targeted reach that the Internet can provide, it is important that you talk extensively to your “A players”" as to how they use the Internet. Are they all utilizing on-line banking services? Do they all regularly visit Weather.com? Are they playing games on-line? Do they check their stocks on a particular site? Do they tune in daily to Dilbert.com for the cartoon of the day? You might be surprised.

By determining where and when your top performers are spending their “on-line time”, along with how often they frequent these destinations, you can start crafting your strategy for reaching out to individuals who share this profile.

The Internet is not a fad. It is here and it is here to stay. The challenge is in how you harness the full capabilities of the web to get your message in front of your target audience, in this case, potential employment candidates. While print is still a viable marketing outlet in some cases, it is quickly becoming to advertising what the Encyclopedia has become to research. As the markets rebound and hiring growth returns to normal levels, it will become increasingly important to have a strategy in place to reach out to both active “job seekers” and passive ideal candidates. The good news is that thanks to the reach made possible by the Internet, you can now get your job advertisement recruitment message in front of qualified potential candidates faster and easier than ever before.