In praise of the recruitment sector
Earlier this month I was invited by Staffing Industry Analysts to record a fascinating TED style panel discussion. The brief was simple, I would share the stage (OK, Zoom meeting…) with two other business heads, one representing in-house recruiters, one representing AI/automated recruiters and me representing agencies. And we were there to present the case why our form of recruitment was best within 10 minutes.
It’s not often you are asked to argue the case for your entire industry to an international audience, but in preparation for the event it really did make me sit back and admire what a wonderful sector we are part of.
We’re in a place where we can positively touch the lives of so many people, and where through talent and technology we can help our clients become more successful – things that have become much, much more important during the Covid crisis.
The preparation also reminded me why agencies have such an important role to play in the talent sector, and why they provide incredible value to so many clients and candidates, over above what can be provided by in-house recruitment or robots. Sometimes, in our busy world of change, it’s easy to forget that.
I have included a summary of my speech below. The event is being broadcast, with live involvement from me other others, on 2nd December. You can find out more here.
As ever, if you have any comments, or – even better – something to add to my argument below, please do feel free to drop me a note, or add your views in the comments section.
Five Reasons Why Recruitment Agencies Deliver Amazing Value
Let me start with the most basic reason: the value of outsourcing. It’s not often seen this way, but agency recruitment is actually an act of outsourcing, or what I prefer to call ‘smartsourcing’ - reflecting how important it is to be work in partnership between agency and client.
And like any outsourcing activity there are many benefits in doing it. It allows the client to concentrate on their day job, rather than being submersed in CVs. It can also be more cost effective; the agency is paying for the salaries of recruiters, the PC, the job board adverts, the LinkedIn licenses, the CRM – the list goes on. Many clients simply find it cheaper to use an agency than to build up a recruitment team themselves.
There’s also agility; outsourcing allows a client to scale up and down their recruitment activities with the minimum of risk. If you go through a hiring freeze – like many have this year – there are no ongoing costs with using agencies, and when hiring returns, which it looks like it is doing – ramping up is easy too.
In short, even if we ignore the four more important reasons I’m about to share with you, agencies deliver incredible value to their clients simply by taking the strain out of their recruitment activity.
2/ Access to expert skills
So let’s move onto the second reason agencies provide unique value - our expertise.
Reed Hastings, CEO of Netflix and someone who knows a thing or two about the power of technology, estimated that the difference in productivity between an excellent software developer and an average one was 10,000%. Other commentators have put it much higher, there were rumours Google estimated it as 30,000%!
But whether you are talking about software developers, or reception staff, or marketing experts or nurses– the point here is that good people can make a real difference.
And to find good people, knowing what good looks like, knowing what drives great candidates, understanding what skills are transferable and which ones aren’t, actually requires an incredible amount of experience.
For instance we had one client who was absolutely convinced they needed deep experience in one type of technology, but was frustrated because there were simply too few people available. Through our experience we knew that it was easy for people to cross train from another, similar technology, and we had examples and case studies to share. It suddenly opened out the field, and they were able to place their rock star candidate.
Few jobs are perfect combination of salary, location, brand and opportunity, and an expert recruiter – someone who has had time to focus on their market - will really understand how to get that balance right for the candidate and client, and along the way gain that most important and rare of things - trust.
Agencies can specialise in ways other recruiters can’t. And our inch wide, mile deep approach can, and does, make all the difference.
3/ Get the job done
The third way agencies deliver incredible value is simply this: they get the job done.
Recruiters in agencies have two jobs. They are part management consultant, but also – unashamedly – part salesperson. And having those skills of a salesperson; the empathy, the creativity, the willingness to go that extra mile, the ‘let’s just do it’ attitude makes a massive difference to their impact.
Whether that’s putting in a call on Sunday night, or – as one of our consultants did – actually doing the commute themselves to show the candidate the job location was well within their range – it is that extra 20% that can make the 100% difference.
Recruitment agencies provide a home to these sales and business development skills, it values them and rewards them and surrounds recruiters with similar minded people.
Yes recruiters are incentivised by bonuses, but actually they are most incentivised by success, in the eyes of their clients, their colleagues and their industry peers
It is this focus, this sense of getting the job done, that gives agencies the edge.
Fourthly good recruitment agencies are here to solve problems, not just simply recruit.
‘Solutions’ is an over-used term, a phrase you will often see lazily added onto marketing literature, but certainly from my experience it is when an agency is truly solving problems for clients that you can see their real value.
For instance 20 years ago a client of Harvey Nash’s in Belgium who we had worked for many years recruiting contractors asked us: could we run the team for them? We thought about it, said yes, and from their our NashTech outsourcing business was born. Another client was concerned about how government employment legislation may affect them and were being tied up in knots by lawyers. We helped simplify the process and helped them manage their risk.
The list goes on, but what unites all these examples is a desire, and ability, to solve wider problems around resourcing. Agencies – both big and small - are amazingly innovative, willing to adapt and evolve.
Our entrepreneurial instinct means that where others may see all problems as a nail requiring a hammer, for us we have many, many more tools up our sleeves.
5/ We are a people business
Finally, my fifth point.
In a world of data, AI and automation, calling yourself a people business might be considered a little unfashionable, but let me say it loud and proud – we are a people business.
Yes absolutely we want to maximise what we can get from automation and AI, in fact Harvey Nash are at the beginning of the biggest investment we have ever made in this. But at the end of this transformation we’re not expecting our 40 office network to become a network of empty ghost ships, filled only by the hum of servers. We’re actually expecting to employ more people. They will just be faster, more productive, paid more and more influential - all enhanced by the power of technology.
That’s because when it comes to dealing with people, Technology alone isn’t the answer.
People are complex, surprising and unpredictable. What was excellent five years ago, might just be average now. What was popular yesterday, becomes overused today, and unused tomorrow. A good example is when Covid forced school exams to be cancelled in the UK, and the government developed an algorithm for predicting and allocating for children’s grades. Here they were working with the data set of tens of millions of previous grades, the most comprehensive and clean data set you could hope for. But the algorithm itself flunked its exam, and eventually they needed to relied on teacher (i.e. human) assessment.
We also need to be very careful to assume algorithms are objective. Many are programmed by male twenty-something software developers in Silicon Valley, working to data sets and knowledge bases captured from mostly Western countries.
Don’t get me wrong, I am certain that algorithms and AI are revolutionising our sector, in fact Harvey Nash are placing many of the people who are doing this very thing.
But if we want to build a fair, diverse, skilled workforce we need great algorithms to work alongside great people.
So there’s my argument. Whilst many have predicted the demise of recruitment agencies, either to the hands of internal recruiters or algorithms, the reality has proved very different. And that’s not through chance, it’s because recruitment agencies – great ones at least – add incredible value, saving clients time, going that extra mile, offering genuine advice and guidance and - above all getting the job done.
It's the reason I love working in this sector, and why the sector continues to attract some amazing talent.
So, as always, please take time to rest and relax over the weekend ahead and keep safe and well.