There is a lot of discussion around fees in the recruitment world at the moment. Rightly so, there is more competition than ever in many quarters and often the divine and god-like client organisations know they can squeeze a little to try and get a little more.
Why wouldn’t they, ultimately that’s commerce, or is it?
A famous art critic, philosopher and social thinker of the 1800s, allegedly said:
“It’s unwise to pay too much, but it’s worse to pay too little. When you pay too much, you lose a little money – that’s all. When you pay too little, you sometimes lose everything, because the thing you bought was incapable of doing the thing it was bought to do.
The common law of business balance prohibits paying a little and getting a lot – it can’t be done. If you deal with the lowest bidder, it is well to add something for the risk you run, and if you do that you will have enough to pay for something better.” John Ruskin – Common law of business balance
Alternatively consider this sentiment:
“There is hardly anything in the world that someone cannot make a little worse and sell a little cheaper, and the people who consider price alone are that person’s lawful prey.” also by John Ruskin.
If you work in recruitment or are the end-user of recruitment services I’m certain that both of those statements will resonate accordingly. So they should.
Together our collaborative selves have successfully managed to upset the Common law of business balance. Often with a little assistance from Procurement teams along the way. Sometimes it appears as if a large part of the recruitment industry in cahoots with their clients have skipped merrily down the road of self or even mutual flagellation (that’s a sadistic form of flogging oneself with some harsh implement such as a stick wrapped in barbed wire, apparently).
So what has prompted this observation and why am I writing an article about something that should be patently obvious but which we have so adamantly ignored. Simple, because deep down there has been no winner from this collective compromise.
There are many clients who think they are clawing back some hard-fought no man’s land and won a loyal army in the form of their Preferred Supplier List replete with eager and hungry recruiters who welcome the meagre rations.
Unfortunately, many recruiters probably feel like they have spent time under bombardment in the trenches, hemmed in on all sides and forever forced into a compromise between professional excellence and survival, agree to our (Non) Preferential Terms or die.
The truth is rather less awe-inspiring. John Ruskin was right in every way. There has to be a balance of reward in business for both sides. Let us be very honest and consider the standard recruitment process which probably applies to the vast majority of client requirements and agency placements today:
The Automated Vacancy Dispersal System (ATS)
The client fires out a vacancy through an automated recruitment system to their PSL. In this instance let us say the vacancy is for a Sales Rep and let us assume that they send it to 7 recruiters.
Hungry and eager to service the recruiters upon hearing the ping of an email masquerading as a potential lunch, dash to open the link to a concise description of the job and basic details such as salary. Very little else in any context.
The only thing which separates these 7 recruiters at this stage is their level of motivation and tenacity and perhaps desperation to pay the mortgage.
The race has begun.
7 recruiters post the same job to 5 job boards each = 35 job postings for one job – pity the poor job seekers. The duplication begins…
Recruiters search their databases for matches of candidates that meet the parameters of the job description. Many of the candidates will be on multiple databases and probably in many cases already on the client’s ATS!
Recruiters then begin the race to call their database matches and check the availability and suitability of the job, the package and the location. Note that they rarely interview the candidate against the job, they simply don’t have time in this mad metrics-driven world. Besides they need to secure as many potential candidates as possible as quickly as possible before their competitors on the same PSL.
Candidates begin applying for the advertised position, many will unwittingly apply to the same job multiple times, often oblivious to the fact that they have already been submitted following a couple of brief calls to ascertain if they are still available. More duplication.
Quality approach don’t you think?
Recruiters, all 7 of them begin firing across to the client all the CV matches. No surprises here that some more duplication occurs. Some of the poor candidates are automatically rejected because they’re already in the system.
Need I go through the entire process? Thus far there has been virtually no communication, collaboration or consultation between anyone. It generally doesn’t improve as the process proceeds. There isn’t time for quality of delivery and consultative recruitment in this kind of process, and besides everyone knows precisely what is expected of them.
Not very much in reality.
So where exactly is the professionalism in this process? There isn’t any. At fees of circa 15%, hard-working recruiters have an expectation of filling 3 out 10 vacancies and they are targeted on volume placements. This is all about churn and burn. This isn’t about consultative recruitment, focused delivery and exceptional service. Expectations are low as is quality and delivery.
What we actually have is recruiters trying their very best under difficult circumstances, a whole bunch of disillusioned candidates and a client sat there scratching their head with circa 20+ CVs to screen and very little insight to help them in that process.
Who’s the winner in this scenario?
The Alternatives
If you are a client why not try engaging with a recruiter properly and giving them some real motivation. Select your recruiter like you’d select a heart or cosmetic surgeon with precision and solid insight.
Giving them a requirement exclusively is a good start. Giving it to them with some skin in the game (retained) is even better. Agree on some hard and fast timelines with them, ask for an update on progress every 2-3 days and tell them what you want and how you want it.
Tell them what would really blow your mind and exceed your expectations.
I have no doubt that you will be pleasantly surprised, you may win over a major ally who as a result gives you a whole raft of added value services such as market and competitor intelligence, priority on exceptional candidates and also markets and enhances your EVP.
I don’t know about you, but I would rather pay a little more and be treated like the most important customer in the world. To know that there was a recruiter out there fighting my corner, promoting my company, working weekends and burning the candle at both ends to get me the result I need when I need it.
PSLs are great for constant high volume recruitment such as warehousing and call-centre staffing, perhaps. But when it comes to key positions that are vital to your business and the capability of teams and departments shouldn’t you treat these requirements as opportunities to add definition, value, capability and prowess to the business.
If you went shopping to find a brilliant Business Analyst for your Finance Director would you expect to find one in the value range’ at Asda? No, you would probably look at the ‘Taste the Difference Range’. I know I would. I want exactly what it says on the tin and I want the very best Business Analyst my budget will buy.
If you are a recruiter, try asking for specific vacancies on an exclusive basis. Be even bolder, begin with a request for a retainer and negotiate from there if you have to. Put your money where your mouth is and offer some real consultative, client-focused expectation exceeding service.
Try (and I know that many of you do. I certainly do) and offer a true taste experience. Give them gourmet cuisine and a Michelin * service and trust me, they will come back drooling for more.
Ask them what kind of service delivery would really blow their mind and exceed their expectations?
As a recruiter, stretch yourself, do things differently and go above and beyond if you’re exclusive or retained. Whatever you do, don’t treat those opportunities like contingency, that’s the mistake most recruiters make and it’s bad for you and your reputation and bad for the industry.
I’m not sure why Glengarry Glen Ross is or at least was such an iconic movie to the recruitment industry, but who cares.
Coffee is for Closers – discounting your fees is for losers – who wants a set of steak knives?