U.S. Perceptions Exist in a Vacuum
Two weeks ago, I spoke at ERE's first European conference, to a crowd of recruiters representing some of Europe's most recognized companies and a handful of U.S. companies with a strong global footprint. I opted to speak on what I consider the most aggressive recruiting tactic available to corporate recruiters: targeted talent poaching.
Prior to arriving in Brussels, Belgium, I prepared for a negative reaction, based on previous experiences with this topic in the U.S. But to my surprise, the reaction wasn't negative. In fact, one member of the audience spoke up and indicated that poaching had become par for the course, a comment that drew affirmation from the rest of the audience. This caught me by surprise, only because over the years I have worked with a number of European firms, and when compared to firms headquartered elsewhere, their hesitation to adopt aggressive approaches was by far the most resolute I've experienced anywhere in the world.
Reflecting on that experience, I realized that it wasn't out of line with other global experiences I've had this year. Throughout 2005, I touched down in eleven countries, mostly in Southeast Asia and Central and Eastern Europe. The perceptions around poaching encountered in Europe could be seen in Australia and New Zealand, where the shortage of skilled talent has threatened the survival of dominant industries. One banking organization was so aggressive that it approached the spouses of targeted candidates while their respective partners were at work to recruit the spouse as a decision influencer.
It seems as though the dominant position the U.S. has enjoyed for years in the political/economic landscape has perhaps made our recruiting organizations complacent. As migration to the global economy causes rapid wage inflation in underdeveloped nations such as India, China, and Eastern Europe alongside steady wage deflation in hyper-developed nations like the U.S. and Great Britain, it is clear that such complacency may tip the scales in favor of the developing nations as the war for talent escalates.
A Primer on Poaching
Poaching talent is the practice of proactively targeting and hiring top talent away from a competitor or top firm, with the specific intention of:
- Securing skills or capabilities faster than if you were to attempt to develop talent internally through training and development efforts
- Securing expanded capacity (i.e. more bodies) that will require less ramp up time
- Mitigating high-level talent losses due to attrition
- Damaging your competitors' ability to achieve their strategic objectives
The approach is not new and has been deployed around the world for ages, particularly in sports. Take a World Cup soccer (football) team for example. Can you think of a single team that is made up entirely of players from the country that team represents? The truth is that when winning matters, the best teams seek out the best talent wherever it resides, be it their backyard or a tiny undeveloped country nestled between two warring nations.
An Unstoppable Global Trend
The migration to a truly global economy is impacting every nation large and small in both positive and negative ways. One of the most apparent impacts is that it has increased demand for labor in nations that once supplied a surplus to developing nations, causing dramatic increases in local wages, in turn making it more difficult to recruit talent abroad. In addition, the rampant growth of offshore outsourcing has imbued developing nations with disposable income, making possible their investment into higher value work.
Combined, these two external forces are complicating the pillage model that for so many years have filled hospitals with nurses and hardware/software firms with engineers. It has also turned the tables, such that developing nations must now devise ways to steal talent back from hyper-developed nations, i.e. poach!
Aggressive firms in such nations are following the leaders, they are:
- Putting work where the talent resides
- Subcontracting outsource contracts for low value activities to other developing nations
- Opening offices in locations that compete directly with their clients
- Offering very lucrative compensation packages for key players who return or are willing to relocate to a developing nation
In short, the war for talent is no longer a local war, but rather a global one that will drive the evolution and practice of talent poaching.
Three Dominant Poaching Strategies
Poaching activities largely fall into one of three categories:
- Direct sourcing. Firms use new data-mining techniques and tools, combined with age-old recruiter phone techniques, to mine the organizational structure, employee identities, and employee performance indicators of talent and product competitors. This competitive intelligence is later used to determine whom specifically should be targeted for poaching. All work is carried out internally.
- Third-party poaching. This strategy relies on using a vendor or series of vendors to identify everything from which firms to target to what individuals to go after based on your strategic objectives. (It is also by far the most common way organizations that find poaching unethical actually practice it themselves. In their minds, poaching is perceived as unethical only if you do it yourself.)
- Attract them with "honey." The third strategy is likely the one that few organizations would associate with poaching, what we call the "attract them with honey" strategy. This approach utilizes six different channels to drive candidates to your organization from other specific organizations, much like product firms steer you to their products in grocery stores.
All three strategies have the same impact in the long run, but offer firms a varied level of "ethical exposure," timeline, and cost. The three strategies outlined above are rank ordered in terms of their time to productivity and cost, from least expensive with quickest impact to most expensive with slowest impact.
Because the ethical concerns over poaching are so great in the United States, the remainder of this article will focus on the channels that power the "attract them with honey" strategy.
The "Honey" Strategy: Six Primary Channels
The "honey" strategy is powered by a number of channels that drive candidates into your recruiting process. While the list of actual channels is long, most of them fall into six categories:
- Employment branding
- Employee referrals
- Event recruiting
- Magnet hiring
- Boomerang hiring
Each of these channels is outlined below.
The Employment Branding Channel
Many firms that have made an attempt to manage their employer brand do so with no particular goals other than to develop either "Best Place to Work" or "Employer of Choice" status (note that both of those terms are registered trademarks!). Such efforts are, for lack of a better word, lame.
Employment branding is not an art, but rather a science. It focuses on identifying which employer attributes and characteristics are needed to recruit a highly defined target audience, aligning organizational structure and management practices with those attributes where possible, and communicating both directly and indirectly with the target audience to position the organization as a leading firm providing those attributes.
Employer branding relies on:
- External recognition as a leader in providing specific employer attributes, such as a value on diversity, innovation, or talent development
- Consistent messaging that continuously communicates who and what the firm is and what value it provides to prospective employees
- A story inventory that provides specific examples of how management programs and practices deliver value to employees
- A specific and differentiated theme (slogan) that competitors cannot easily mimic or assert
- Recognition for functional excellence
- Lots of lots of press coverage in very specific publications that reach into the targeted audience
The Employee Referral Channel
Just as most firms approach employment branding with no specific goal or outcome in mind, they often develop employee referral programs that meander and produce mediocre results at best. A targeted employee referral program, on the other hand, utilizes the employee population to do all of the competitive intelligence mining that enables targeted poaching, with an added benefit: It gets employees to utilize their personal networks to initiate the recruiting process.
A targeted poaching effort that utilizes the employee referral channel relies on:
- Active referrals: An approach that goes to employees with a specific set of questions that prime them to remember who they know in specific roles, organizations, etc.
- Top performer referral prioritization: An approach that acts on all referrals coming in from proven top performers before acting on those from other employees
- Reference referrals: An approach that contacts references of past hires that proved to be top performers and asks who else they know
- Stakeholder referrals: An approach that leverages non employees who have a vested interest in the success of the company to generate referrals, such as consultants, suppliers, stock holders, etc.
The Events Channel
Nearly every organization that recruits will attend at least one event a year, be it a recruiting event, an industry trade show, or a vendor exposition. But few select events to participate in based on their probability of attracting employees from specific competitors.
Utilizing events as a poaching channel relies on:
- Identifying and participating in specific industry trade shows or association events that have a proven attraction to employees of targeted competitors
- Hosting onsite seminars and certification courses that are attractive to the competition
- Participating in non-industry/non-professional events that attract a target audience, such as a beer and wine or arts festival.
The Magnet Hire Channel
The magnet hire channel is quite possibly the easiest one to understand. It simply relies on polling top performers to identify the most respected or most visible professional who they would be interested in working with, and then working to hire that person in hopes that they would attract others to your organization.
The Boomerang Channel
At some point in time, nearly every employee decides to make a change and severs an employment relationship. The boomerang channel is used in poaching by identifying former employees that are currently employed by a competitor and developing specific strategies to lure them back — which brings the added benefit of lots of competitive intelligence about organizational structure and management practices, but not trade secrets or product information!
The Internet Channel
The final major channel that is used to power the "honey" approach to poaching is the Internet channel. Unlike job posting and data mining, these approaches use the Internet to develop resources that employees of competing organizations are drawn to.
- Hosted information resource sites. These sites provide valuable information that is useful to the target audience in their current role. For instance, a hospital organization might launch an e-newsletter for nurses that provides summaries of the latest breakthrough and techniques.
- Moderated professional forums. These tools enable professionals from a multitude of organizations to share information and discuss issues in a safe environment, free from advertisers and spammers.
The battle lines in the war for talent are expanding, and those with the most to lose need to understand that aggressive tools and approaches will be used by the competition. There is no place for complacency on the battlefield, which causes unnecessary death. Developing firms in developing countries are desperate for talent, and they have no reservations about poaching your best people.
The evolution of poaching has begun, and there is no turning back. While the honey strategy will work in the short term, it is expensive and takes time. Eventually recruiters will have to learn to accept the role they play in their organizations' future and get past what concerns they may have with direct poaching.