InHouseRecruiters200x233HR has taken huge strides in the last 20 years to prove their worth, but the fact is that HR is an overhead. What HR professionals have achieved is to demonstrate the return they can make on investment with strategic contributions. Reducing recruitment spend is a quick, obvious win to create a sense of offering tangible value, and unsurprisingly many companies have adopted direct sourcing models to achieve this.

In picking this low hanging fruit, have companies become complacent in developing resourcing as a strategically focused function? Is short-term cost taking precedence over the strategic goals to attract the best people in the war for talent? With some interesting results from recent surveys to the in-house recruitment community, people seem to be questioning how recruiters are being used – tactically or strategically? Recruiters may have one view on what they’re there for, but is this how their employers see them, and is that how their expertise is being deployed?

To hire the best or keep down costs?

A survey by The Highfield Partnership aimed to explore the attitudes of in-house recruiters towards finding the best talent and how employers measure their performance was sent to a cross section of private sector in-house recruitment professionals across the UK. Some of the findings are also reinforced by The Forum for In-House Recruitment Managers’ (The FIRM) recent report on strategic talent acquisition.

It was no surprise that 85% of respondents said their companies measured and actively sought to reduce recruitment costs. This corresponds with recent research by The FIRM showing similar figures (79%) citing direct sourcing as their 2013 priority. What was perhaps surprising was only half that number in The FIRM’s report cited cost reduction as the priority, even though it could be argued direct sourcing is itself a by-product of the strategy to reduce cost. With three quarters of the recruiters questioned believing their primary purpose was to find the best people, not reduce recruitment costs, does that hint at diverging priorities between recruiter and employer in their expected outputs?

Incentivising for results?

Acknowledging the other benefits of direct sourcing (process control, best use of brand, time etc.), cost is obviously not its only virtue. Further survey results suggest a disparity between the recruiters’ perception of their strategic impact and the reality of their tactical focus. For instance, even if cost reduction holds a strategic priority, only 30% of those surveyed were incentivised financially to reduce costs. With growing numbers of in-house recruiters coming from agency/search backgrounds (and so accustomed to bonuses for results), could the majority of employers be missing a trick when trying to get the best from their teams?

Where is the measure of quality?

More pointedly though, were the results showing how few employers used qualitative measures to manage or motivate their recruiters. Given that 75% of recruiters felt they were there to get the best people for their employers, survey results did not suggest that employers are taking steps to properly drive performance in this area. Over half of respondents were not in receipt of a performance bonus based on customer satisfaction – a strong potential source of reference to the quality of the recruiters work. Only c.5% had most, or all, of their bonus measured against this rating.

More significantly, only a third of respondents said the recruitment function did not measure the progress of the new hire (The FIRM reported similar figures of 27%). Half of those monitored this within the first year, and 17.5% beyond 12 months. Considering it can often take at least 12 months for a new employee to really start demonstrating their value, this could also raise a question that recruitment teams are being measured on a skin deep analysis of their performance. If the remit is to truly recruit the best people, the question has to be asked: who’s judging the success of this?

Time to re-evaluate?

In the evolution of the in-house recruitment function, the meaning of life for many is perhaps more a tactical operation recruiters would like. Employer brand was reported as the greatest asset to recruiters in attracting top talent at 62%; should this be 2013’s priority? Is there an argument to appoint more senior level/better paid recruiters? “Price is what you pay, value is what you get,” as Warren Buffett says.

With the big focus on building future leadership and talent capability to drive organisational performance, is this the time that recruiters need to take a brave look at themselves and their organisational contribution to persuade their employers of their value in the challenge of talent acquisition in post-recession Britain? To transact for the short term, or to add long term value, that is the question!

Other notable findings from the The Highfield Partnerships survey:

  • 62.5% of recruiters felt employer brand was their greatest asset to hire top talent, followed in order by career opportunities, attractive packages, flexible working, referral programmes, and freedom to use any resource least
  • 77.5% of recruiters felt that cost restraint had some level of impact to restrict getting the best possible people for critical hires, although 17.5% said they felt if cost was no issue they still wouldn’t achieve stronger shortlists
  • 60% of recruiters who were paid a bonus, had it rated to some degree against cost savings achieved
  • 58% felt it was harder now to find the best people than during pre-recession times. The reasons given for this included: the impact of the economy still discouraging people from exploring new challenges, a flooded labour market, and more internal pressure with the misguided belief that talent is easy to find. 20% actually felt it was an easier task now, be it with stronger brand profile or greater visibility of talent in LinkedIn.
  • 40% felt agencies/search firms rarely or never offered value for money – food for thought for this industry with the advancing trend to hire in-house recruitment capability.

Written by Tom Godber, founder of The Highfield Partnership

Tom has worked as a recruitment professional for over 15 years, with experience partnering large multi-national clients as well as small start-ups. His particular expertise lies in the field of the HR recruitment market, working predominantly on mid to senior level appointments within the UK and internationally. Having worked in leadership roles with large recruitment consultancies and boutique search, he established The Highfield Partnership in 2012, a London based HR Search & Resourcing Consultancy.

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