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Once upon a time, companies lost money on their contingent IT workforce. Huge consulting expenditures were creatively hidden in the books. IT managers were riddled with unproductive sales calls. Single companies engaged hundreds of vendors, largely based on favoritism rather than a true assessment of value-add.
As a result, no one knew how many contract employees ran through the halls every day. Furthermore, no one ensured the processes by which these contractors were hired and managed was appropriate, let alone optimized.
Eventually, C-level powers caught wind of this problematic situation. They demanded improvement.
Companies needed real-time visibility into expenditures and vendor performance so better decisions could be made. Thus began the rise of automated vendor management systems (VMS) and stringent hiring processes for contract labor.
Overall, I view the formalization of vendor management operations as a positive trend. Companies are right to take a serious and strategic approach to talent management and services spend. However, there are a few detrimental — albeit unintended — consequences that can result from controlling the human-contact sport of recruiting too rigidly.
A commodity is something that is mass produced. One commodity unit is therefore of low relative value. By definition, it can easily be replaced by another of its kind.
While it’s simpler to manage your pipeline of contingent workers as though they are commodities — funneling slews of resumes into an automated system, avoiding direct contact with vendors to discuss openings or give candidate feedback, and standardizing rates across general skill categories — doing so can harm your ability to attract the best candidates to your organization.
I’m a firm believer that talent is not a commodity; it’s a valuable rarity organizations can leverage to obtain an inimitable, sustainable competitive advantage. Quite plainly, to operate as a great company, rather than just a good company, you need A-players. However, A-players, are already employed. They are also in demand. (TEKsystems segmentation study reveals that the average IT consultant receives 23 recruiting solicitations a week!) Thus, to attract the best to your organization, it’s critical to find a way to stand out.
Talent providers must have insight to opportunity details to communicate employee value propositions (EVPs) and compel high-quality professionals to literally want to work for your organization.
This truth grows abundantly clear if you consider the recruiting situation from the candidate’s perspective: If you were a hot-shot A-player, which recruiting call would you be more likely to return? (a) One in which the recruiter knew little more than was communicated in the electronic job description, or (b) One in which the recruiter could share position details around the culture, the team, the project’s objectives or opportunities for visibility and advancement?
I am shocked and disappointed by the trend toward “bar lowering” I witness in the industry. A primary reason organizations should leverage talent acquisition firms is to not only source high-quality candidates, but also to screen down a pool of many to a select few who can truly do the job outstandingly. Why then are more companies today insisting their staffing providers just dump hundreds of resumes into an automated system? Why aren’t they forcing their vendors to submit reference information or other such evaluation results that would help to ensure a vendor’s due diligence in the screening process? Why do they just trust vendors will go this extra mile as opposed to making them prove it?
Two reasons come to mind. First, functions beyond the hiring manager and HR are assuming control of the talent acquisition process. These other functions are not always going to “feel the pain” of an inefficient hiring process or staffing the wrong hire into a critical role. Second, there is an increasing trend toward implementing limited to-no-contact policies that cater to management simplicity, at the price of enterprise results and competitive advantage.
Sure, under a no-contact model hiring managers can go about their days uninterrupted by vendor calls. And, sure, any vendor worth its salt can certainly recruit off of electronic job descriptions. But, the consequences of a no-contact process inevitably culminate into a plight I call the “resumemess,” tons of buzz-word-laden resumes (over half of which include lies or exaggerations tailor-built to the job description), delivered as fast as possible, into a giant black hole. When the “resumemess” rears its ugly head, candidates fail to receive adequate feedback on their applications due to the sheer volume of applicants involved in the process. Moreover, hiring managers — who are already overwhelmed due to the fact that they are in need of personnel — assume the additional responsibility of sifting the wheat from acre upon acre of chaff.
By investing just a little more time upfront to educate your talent providers about your opportunities and what’s most important to look for in your ideal candidates, companies can set themselves up for a far better scenario: fewer candidates submitted, each of whom are already screened and vetted according to objective and subjective job requirements. In other words, by engaging your providers as partners, and communicating important job details to them, organizations can start to demand their providers raise the bar on screening their candidates, thus adding greater value to the talent acquisition process.
I understand that there are hundreds of staffing vendors out there that waste hiring manager time through low-value calls, unproductive meetings and irrelevant social outings. Organizations are right to limit such interactions. Yet, by addressing this problem through a fully-automated, limited-to-no-contact model, organizations create another problem for themselves. They force talent providers to operate off of limited intelligence, and thereby limit the value those providers can add back to the client organization.
Interestingly, according to multiple sources I’ve researched, the number one complaint IT leaders have about the IT staffing industry is, “you don’t understand my business.” Touché. This is a problem! To address it, however, organizations must enable their talent providers to understand their strategy, business objectives, cultural norms and upcoming goals. As many providers do not go about acquiring this information in a productive way, if at all, I am not surprised organizations are giving the industry a forceful heisman. By this I mean, for sake of “vendor neutrality” many well-intentioned organizations refuse to supply talent providers with valuable intelligence about their company or about a specific job opening. However, given the criticality of human capital, organizations must take care not to respond to their frustration by taking actions that worsen their situation. The thought is that detailed information could give one provider an unfair advantage over the others — and it certainly would! But what’s the end game? Should an organization refuse to supply details about an upcoming project to a supplier that has the acumen to seek out proactive intel? Who does refusing to give this organization information ultimately benefit? It certainly doesn’t benefit the hiring manager seeking a partner to find him/her qualified talent quickly. It also doesn’t benefit the candidate (as I previously discussed) seeking good information about an opportunity. It only really benefits those providers too lazy or uninterested to ask for the information. If they don’t get the information, then no one does. Under this type of vendor neutral model, the playing field is kept fair, but organizations will ultimately lose the game as providers lack incentive to go above and beyond.
It is my sincere desire, and mission, to educate talent providers about how they can add greater levels of value to their customer base. At the same time, as the trend toward formalizing vendor management continues, I see it as equally critical to educate customers about how they can avoid some devastating pitfalls and optimize their talent acquisition strategies.
Author: Mike McSally, Vice President of Enterprise Operations at Allegis Group