Sunday, October 18, 2009

And now for something completely (?) different

I'm diverting from Risk per se the deal with another decision-automation question I'm wondering about.
High-tech fluctuates. It boomed on the verge of the new millennium, and did so (albeit differently) before the latest downturn. And when booming, help is required. High-tech companies don't usually post a "help wanted" sign on their office wall (though some in Israel did), and getting to a good position requires some work beyond coming from a good school. In the days of the "bubble", just knowing a few people would secure you a position somewhere in the space, but nowadays it takes a lot more than that - employers demand good grades, subject matter expertise and experience - all of which are no mere feat for new graduates.

Enough about job seekers, though. What about the poor hiring manager? I wrote a bit in the past about what we're looking for and how we balance experience with skills, but haven't discussed how HARD it is to find candidates. People, the right people, don't just come waltzing through your door when you need them. It requires some preparation, a lot of "scouting" and a good pipeline of interviewers ready to embark on a blitz. And since we don't just know everyone, it requires an HR agency. This is where things become even more interesting, and raise one big, interesting, repeated question.
Why, in the year 2009, are HR agencies still highly human intensive operations?
I see it everywhere. Dozens of companies, in a highly commoditized space, competing on three factors: price (what percentage of the candidate's salary will they receive upon hiring), speed and mass (of sent CVs) - two factors enforced on them since the only way to beat the competition is to get to the hiring company before them. This means literally hundreds of workers arriving to work as early as possible (before everyone else wakes up), scanning through hundreds of CVs (in Israel, all HR agencies even feed from the same source -, sending them in an almost unconcious process to every position with even a slight keyword match between the job description and the CV (god forbid any real professional scanning).
Sounds familiar? Yeah, in some lingos this is called SPAM. And this is exactly how this feels.
The other extreme, by the way, is specialized companies hanging their unique value proposition on the team's (usually the CEO's) ability to attract high talent candidates for high ranking positions. In these cases you don't get spam - you just pay ultra high retention fees to get someone from the CEO's close network of former and current executives. It's like a carousel, but one where everyone grabs the brass ring.
So companies pay top dollar for something their staff could do themselves, but instead they outsource. But because of the incentive structure, they fail in outsourcing the mass waste of time, since someone inside the company still needs to sort through all the CVs that keep pouring in.
Here's an alternative: hire a few real resume experts, or train them - if you have the skill and experience needed. Learn how to classify and categorize (how do you know that this is the right person for the job at this company?). Automate - you'll get your feedback from your clients, when they call on people for an interview. Then, when you start to gain credibility, package your new ability with a better incentive program. Change the measurement - maybe higher 1st interviews per number of CVs? - and make a bundle agreement to give yourself exclusivity for some of these positions, and buy more time to get better at matching candidates to a company. Reiterate.
Sounds simple, but it isn't. Forget the development of this operation; one of the main obstacles is, simply put, hiring risk. The chances of someone mis-reporting or just outright lying about what they did or why they left a company. I hear hiring agencies started to hire ex-law enforcement people to improve this aspect of their processes. Maybe we're about to see a new area of Risk Management. But my point in that this is doable, though not extremely easy, and I'm not sure why this wasn't ever done. Let me know what you think!

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