Recruiting is just like fishing. You may think that there is a shortage of fish, when the real problem is where you fish and what bait you use!
I simply have to laugh when I hear CEOs and executives complain about the talent or skill shortages that their firm faces. I laugh because I find that this so-called “talent shortage” applies exclusively to firms with weak recruiting and employer branding.
If you work in the tech field, for example, you will hear many executives complain about a shortage of talent.
But how do you explain the fact that one firm, Google, faces no talent shortage because it gets nearly 3 million applications each year? For 5,000 hires per year, that is over 600 applications for each opening. When most of the firms in its industry are suffering from a talent shortage, Google, because it’s the No. 1 employer brand, has only a “talent sorting problem.”
“There is a dire talent shortage … unless you are a great place to work” — Tom Peters
If you are a fisherman, you already know about the well-prepared fisherman’s paradox; this is when dozens of anglers on a lake are complaining about the lack of fish, while at the same time, the best skilled fisherman/woman is continually reeling in the fish and views the disparity in results as simply “a bait problem.”
Shifting back to business, if your firm’s head of sales was audacious enough to state that your firm was facing “a shortage of customers,” any good CEO would likely immediately respond in anger by pointing out that the leading firms with the best marketing, sales staff, and products certainly don’t seem to also be experiencing the same “customer shortage.”
You can’t as a corporate leader blame any shortage of fish, customers, or top candidates at your firm or the marketplace. It is a recruiting problem, pure and simple, and recruiting leaders who try to tell you that there is a labor supply or talent shortage facing your individual firm are in reality guilty of trying to deflect the blame away from themselves.
The Talent Shortage Myth Explained — for Any Single Firm, There Is a Huge Talent Pool
The myth of the talent shortage begins when you focus on the needs of an entire industry, rather than the needs of your own firm. If there was a real shortage of, for example, nurses, then you should ask yourself this question, “How many qualified nurses live or work within 50 miles of your facility?”
If there was a real shortage, the answer would be zero, or a number lower than your current job openings. But the actual and accurate answer is almost universally, “There are thousands of them, but they all currently work at our competitors.”
Now, continuing with the fishing analogy: One of the reasons that great anglers continually catch the most desirable fish is that they know the best location where they should cast their bait. In the same light, firms can eliminate any shortage of qualified prospects if they change their location to where the most desirable talent can be found. And that is “working across the street at your competitors.” Any single firm needs to recruit less than 1 percent of the talent currently working in their industry. So if your firm wants to have a talent surplus, it must consider the other 99 percent of the industry’s workforce as your talent pool and your talent farm team.
Recruit at Your Competitors and There Will Be a Surplus of Talent
So in the end, the real problem for a single firm is not an actual shortage but the inability of your firm to attract currently employed and skilled individuals away from their present employer and over to your firm. In other words, there is plenty of talent that could be recruited. You are just fishing in the wrong place, with the wrong equipment, and with unattractive bait. For a single firm, it’s not a supply problem, it’s an attraction problem. The recruiting principle to remember is “Those firms with the most effective attraction bait” (one which is powerful enough to draw talent away from your competitors) will never suffer a talent shortage, even when the majority of industry firms do.”
With Outdated Bait and Fishing Gear, You Won’t Attract Your Share of the Fish
What also makes me chuckle is the fact that the same leaders who are complaining about a shortage now, as few as two years ago in a down economy had a talent surplus and hundreds of applicants for each job opening. Since there have been no news reports of aliens abducting a huge number of talented individuals, it makes sense to look for another answer. All that has really happened is that there are many fewer easy-to-attract unemployed people, and that the “active” recruiting tools that worked well for your firm during high unemployment times are simply ineffective today.
So the 100 percent accurate answer as to why your firm faces a shortage, and the top firms in your industry do not, is that your firm is recruiting the wrong target audience with weak bait. Weak bait in the recruiting field generally means that your firm can’t attract top talent because it
- Has a weak employer brand image
- Uses ineffective or outdated recruiting tools or
- Offers jobs and a work environment that are simply less exciting than your competitor’s
Action Steps to Overcome any Talent Shortage at Your Firm
As the economy continues to improve, any current shortage at your firm will only get worse, at least until you upgrade your recruiting and employer branding strategy to the point where it is near the top in your industry. Some of the recruiting action steps that I recommend to eliminate talent shortages at your firm include:
- Build the business case — very few things in business can be dramatically improved without an increase in resources, and recruiting is no different. So start your talent shortage reduction effort like other firms have, with a strong business case. As a result of making a strong business case, Google has a recruiting budget that is double that of the average firm in their industry. Even less-glamorous firms like The Container Store have created a powerful business case, including in its case the calculation that one great performer produces as much as three good employees. So work with the CFO’s office to prove the bottom-line impact of upgrading your recruiting function and its results. And incidentally, even the most expensive recruiting function on the planet requires less than 1 percent of the total company budget, so relatively speaking, it doesn’t take very much of the firm’s money to develop an industry-leading recruiting function that can permanently end any talent or skills shortage at your firm.
- Directly target the talent at your competitors — if you want a high volume of already developed and proven talent, you have no choice but to focus your recruiting on luring out that most desirable talent away from your product and talent competitors. And finding the names of the talent who work at your competitors is now amazingly easy as a result of LinkedIn and other social media sites. Because their current boss will probably fight to keep them, in order to successfully recruit at your competitors, you will need great recruiters, a poaching strategy, advanced recruiting/selling tools, and a perceived better opportunity than their current job at their present firm.
- Require recruiting to be data-driven — because recruiting and the job market are constantly evolving, you can’t expect to remain effective by just copying the current practices of the top firms. Instead, you must use data to continually improve and to stay on top. Start by measuring the quality of hire, the dollar impact of top performers and innovators, the selection criteria that accurately predict top performers, and the most effective recruiting sources (usually employee referrals). The talent management function with the highest business impact is recruiting, so make your executives aware of that fact.
- Build a magnet employer brand image — in a social-media-driven world, no firm can hide the fact it provides a bad candidate experience or that it doesn’t offer exciting work. And with all the clutter, you must be both precise and proactive in virally spreading your own positive brand message. In order to build your image, both your executives and your employees must get involved in improving and then spreading the word about the practices that make your firm a top place to work. Incidentally, if you must also target university grads, you won’t capture even your fair share of them without a superior employer brand and an up-to-date college recruiting strategy.
- Stop offering paycheck jobs — top performers want two things: to do the best work of their life, and to have a major impact. If you merely offer a “paycheck job” that isn’t challenging and exciting, you certainly won’t convince the best to leave their current job. And yes, that probably means redesigning your hard-to-fill jobs and your work environment, so that employees have more freedom, challenge, learning, and excitement and that those features are visible to external prospects.
- Offer remote work — if you want to attract top talent from around the world, you simply can’t expect all of them to relocate. By converting your hard-to-fill jobs into remote work jobs, you can expand your recruiting target from the employees at the best firms in your location to the employees at the best firms everywhere in the world. If you’re facing a shortage of women recruits, remote work will dramatically increase the number that are interested in working at your firm. Remote work options can also eliminate any problems associated with your worksite’s location. When you implement remote work, you need to convince your managers to be bold and experiment. You also need to ensure that managers understand the tools for managing a remote worker. If they try to manage the remote worker with their current style, the experiment will fail, they will never try it again, and they will spread that negative message to other managers.
- Use better and unique recruiting tools — because other firms will also target the same talent as you, the recruiting tools that you use must provide your firm with a competitive advantage. You simply can’t win any recruiting competition if you continually use the same recruiting tools and strategies as your talent competitors.
- Hire or develop great managers — top talent only wants to work for great managers. So if you expect great recruiting and retention, you must focus on recruiting or developing great managers in large numbers.
- Courage and the willingness to take risks — even though it is listed last, courage may be the most important element of a targeting-your-competitors recruiting strategy. Since the answer to any firm’s talent shortage is luring away talent from your competitors, your executives and HR/recruiting leaders should have the courage to raid, poach, or draw away currently employed top talent. Unfortunately, most do not. If you’re worried that that might ignite a war with a competitor, get over it. You fight a war with your competitors every day over customers and no one in sales would ever argue that stealing customers is unethical. And finally, in order to be successful, you also need highly aggressive and well-trained recruiters that excel at direct sourcing.
Great Recruiting and Employer Branding Also Impact the Bottom Line
Having great recruiting not only solves the so-called “talent shortage problem” but it also has many positive bottom-line impacts.
In case you are not aware of it, the top three most valuable firms in the world Apple, Microsoft, and Google all excel at employer branding and recruiting. And Facebook, also a recruiting powerhouse, has moved up to No. 10 even though it has been only three years since its IPO. Executives should realize that attracting top talent from competitors has numerous bottom-line impacts. First, you acquire talent that has already proven experience on the job. Second, you can target current innovators, which may have five times the impact of a regular hire. Third, these individuals bring with them the best practices from their previous firm. And finally, attracting this talent makes your firm stronger, while weakening your competitors at the same time.
Unfortunately, many firms don’t realize this high ROI because their risk-adverse recruiting leaders often don’t have the will and weak recruiting functions don’t have the capability of effectively drawing top talent away from other firms.
Once you realize that there is an abundance of talent working at your competitors, the next step is to make recruiting an integrated effort that involves everyone. If you make a strong business case, every executive and hiring manager will almost overnight develop an interest in helping to develop the capability of drawing away top talent from competitive firms. But you should also get your employees involved, and you can do that by revitalizing your employee referral program and making every employee a 24/7 talent scout and an employer brand ambassador. Once everyone is involved, it’s recruiting’s job to use metrics and analytics to determine which recruiting and branding approaches work the best.
If you’re still not convinced, consider the case of Duke in college basketball and Alabama in college football. Most college teams with average images and recruiting approaches face a shortage of talent year in and year out. But no matter how weak the overall recruiting class is, these two recruiting powerhouses always end up with a surplus of talent. And that is because the answer to all talent surpluses … is simply great branding and recruiting!
As seen on ERE Media on JUNE 29, 2015