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It’s Time to Take Another Look at Headhunters

The economy is recovering, but there are still millions of people desperately searching to find a job.  The irony is that many jobs are remaining unfilled.  Why?  The employers say that it is because they cannot find enough qualified applicants to fill them!  The recruitment vendors say it is because the good people are hard to find and they have responded by developing a wide assortment of cutting edge tools to help employers find the good people.  On the other hand, veterans from the old school of headhunting has proclaimed that the main reason employers cannot find enough qualified applicants is because the recruitment tools that they are using  are no longer effective in recruiting the good people. Now is the time put recruiting back into the hands of headhunters and employers need to take another look at headhunting as a talent acquisition solution!

THE PROBLEM

Is it that the good people are hard to find or is it that the present recruitment tools are no longer effective in recruiting the good people? 

A better question might be, is there a new modernized method for recruiting the good people in today’s environment?

The new headhunters of today are saying, hello-over here!

CURRENT RECRUITMENT TOOLS

Today there are boat loads of job boards, social media, and mobile recruitment tools available to help employers find the good people.  But when you peel back the layers, they all funneled into one of only four methods for recruiting talent.  The methods are free or paid advertisement and internal or external recruitment.

FREE ADVERTISEMENT

This is the cheapest method for recruiting the best talent.  The reason it is cheap is because it is done through word-of-mouth marketing.  So, it is employee referrals and the individuals that you know personally, who will do the hands-on recruiting.  They are the ones most likely know the person with the right skills because they have worked with, trained or competed against that individual.  But the reason why this method is ineffective in recruiting the good people is because of limited reach.  The buzz in the marketplace of your job opportunity will reach only the individuals that are inside of your circle.

PAID ADVERTISEMENT

How do you reach the other applicants that are outside of your circle?  You can advertise the job on the Internet, because it has a very wide reach.  But the reason why job boards are ineffective in recruiting the good people is because of over-reach.  The ad will be visible to too many people with the wrong skills that are needed. As a result, the ad will generate a huge quantity of resumes and very limited quality in terms of applicants. On top of that it will require a significant investment of time in mining those resumes in search of the few qualified applicants.   

INTERNAL RECRUITING

How do you find the qualified applicants from the huge mound of unqualified resumes without wasting valuable time?  Most employers will hire a full-time employee to perform this function.  The problem with this method is that if the employer does not have a nationally recognized brand that can attract enough qualified applicants based on its name, then finding qualified applicants’ will be in the hands of that full-time employee.  And if that employee is spending a lot of time searching for qualified applicants, this method can become very costly when taken into account the salary, benefits and the internal cost associated with employing a full-time employee.

EXTERNAL RECRUITING

This involves outsourcing the recruitment functions to professional headhunters.   This is the most strategic and targeted method for recruiting talent.  There are two reasons why:

  1. Headhunters recruit ahead of the need by focusing on developing relationships with the individuals that they would like to recruit before they actually needed to recruit them.    This is essential for building trust which is the most over-looked and the most powerful ingredient for recruiting the best talent.
  2. Headhunting is also very cost effective; it allows the employer to focus on the profitable functions of his business and relieves him of recruitment limitations, the time-intensive and the headache oriented functions of talent acquisition.  At their own expense, the headhunters provide screened qualified applicants that the employer can evaluate to determine if a fit exist.  This is a free service to the employer if no applicant is selected.  The employer will pay a finder’s fee only if the employer selects an applicant that is determined to be a value for the finder’s fee.   But even headhunting has become ineffective in recruiting the good people.  Why? Many employers have concluded that the finder’s fee is way too expensive.

SOLUTION

Take a good look at the recruitment tools on the market today; they are mostly designed for the paid advertising and the internal recruitment methods.  That is only because employers have become more focused on the cost of the finder’s fee and are less concerned about the cost of not using headhunters.  In addition, the free advertisement model is not as popular among recruitment vendors as they have not yet discovered a way to generate revenue from selling it as a solution.  That explains why so many jobs are remaining unfilled; the good people aren't moving and it’s not because of the economy. It is because they are not inspired to want something that they don’t know they really want.   The good people have to be inspired and become emotionally involved before they will take look at your job opportunity.  So the new modernized method that will enable you to recruit headhunted caliber talent in this environment is a combination of the free advertisement and the external recruitment models.  The challenge will be to strategically broaden the reach on one end to include a larger targeted talent network and creatively lower the price on the other end.  Easier said than done, but it is definitely an overlooked opportunity for headhunters.

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Tags: Agency Recruiting, fees., headhunter, placement

Comment by Mitch Sullivan on May 8, 2013 at 9:49am

How are you defining Headhunter here?

Comment by Ken Forrester on May 8, 2013 at 3:17pm

More contingency than retained.  Retained is probably more management consulting by nature.  Would you agree?

Comment by Bill Vick on May 13, 2013 at 9:15am

Good Points Neil and well put. My simple summarization is HeadHunters are still the best solution because the super star candidate a company is looking for is not looking for them, and often has to be found, and dragged kicking and screaming back to the client company. A good HeadHunter is just that - a head hunter. They are not an employment agency, they work for the client and their skills are more slanted to the human side of the hiring equation that the internet or technology side. I've be fortunate to know many Big Billers (the top 1%, often million dollar billers) and without exception they are HeadHunters who proactively identify, find and help a client company hire the right candidate.

Comment by Dave Nerz on May 13, 2013 at 4:14pm

Good point of view Ken.  Employers fail to realize the cost of open positions and tend to see the cost to fill open positions as their primary driver.  If an employer loses $100,000 of revenue for every 3 months a $75,000 job is open, wouldn't it be worth it to fill that job in 1 month for a 25% or 30% fee? 

I've always been a fan of the saying "It is difficult to save your way to prosperity."  Businesses need to invest and investing in people is a great place to start. 

Comment by Fred Elmore on May 16, 2013 at 10:20am

Thank you for sharing your thoughts, Ken.  I would add that HeadHunters niched in a specific industry will be more effective than those who recruit “soup to nuts”.  Wouldn’t you agree?   For example, would you buy Sushi at the 7-Eleven? 

 http://www.clinicalstaffingreviews.com/would-you-buy-sushi-at-the-7...

Comment by Ken Forrester on May 16, 2013 at 10:58am

Good question Fred and I see where you are heading on this particular subject. 

The problem is that some agencies present themselves as a Wal-Mart, but they only have enough goods to stock a 7-11. It damages their brand and the value of all agencies as well when they are not able to deliver the talent they are expected to deliver.  So, if you only have the capacity of a 7-11, it might make sense to carve out a niche and develop some expertise.  

The advantage is being able to speak the client’s language so you can present the opportunities of the job in the language that candidates learned their craft and are most comfortable.  In this case the headhunter is valued more than just another headhunter trying to fill a job-but a strategic advisor to the client and the candidate

Comment by PAUL FOREL on February 24, 2014 at 8:56am

Ken, Good Morning...

FWIW, 'Headhunters' are both contingency and retained search agents. There is no longer a distinction between the two when referring to 'Headhunters'. The 'qualifier' is whether such a person is either retained or contingency.

The reference to 'consulting' is most attributed to retained search agents since historically, they were the recruiters who took a comprehensive view of the recruitment process.  Since there are so many contingency recruiters who do not take a holistic view of recruitment and simply take a job order as issued and run with it and are often 'toss it to the wall and see if it sticks' type of recruiters, they can hardly be referred to as consultants.

Retained search recruiters are often assisting their client in the development of the Position Specification/Job Order and, how the newly hired person will fit into the organizational chart -determining with/for their client solid and dotted lines of relationships/communications- and also, for example, what a salary range for the position would be. These are 'added values' the retained search recruiter provides and is another reason retained search recruiters are viewed as 'consulting' [in addition to recruiting].

In the end, any recruiter can be seen by their client as a 'consultant' depending on how that recruiter portrays herself/himself and how s/he involves herself/himself in the in the entire recruitment process.

'Consulting' then, becomes a matter of perception.

Thanks.

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