One of the challenges in the fast-moving profession of recruiting is how to keep up with the latest evolutions in best practices at the best firms. Fortunately, it’s a little easier to learn about the emerging benchmark best practices as a result of ERE Media’s Recruiting Excellence Awards, which honor the most strategic and innovative global recruiting practices developed throughout the year.
The awards banquet, which usually kicks off the Spring Expo, was an excellent start to the event that has become the pinnacle meeting point for the best and brightest in the profession. This year, more than 1,100 recruiting professionals and vendors descended upon San Diego, California to learn about organizations that are breaking new ground by becoming more businesslike and analytical.
This year’s Expo added even more opportunities to learn from those organizations honored, as the agenda included a new panel discussion featuring selected honorees discussing their organizations’ award-winnings efforts. In addition, previous award winners, such as Michael McNeal, Dan Hilbert, Michael Homula, and Expo chair Trudy Knoepke-Campbell (all of whom have since become icons in the recruiting profession), were on-hand to chat with attendees.
As someone who tracks HR best practices (as well as serves as a judge in the awards process), I am privileged to be able to share my assessment of their innovative approaches and groundbreaking results.
Best Diversity Program: Sodexo
A leading provider of food and facilities management services, Sodexo has worked hard over the past few years to excel in all areas of recruiting and talent management, and its work with regards to attracting, developing, and retaining diverse talent is the best I’ve ever seen anywhere in the world. Whatever you are doing to promote diversity pales in comparison to the Sodexo approach, which combines extensive metrics with significant rewards for managers and executives in order to produce results.
Some highlights that led Sodexo to win the diversity award this year include:
- Sodexo developed the Diversity Index Scorecard.
- The scorecard contains both quantitative and qualitative measures (qualitative measures look at behaviors that lead to building diversity, while quantitative measures focus on enumerating talent acquisition, development, and retention activities that drive diversity, including promotions).
- Ninety-one percent of candidate slates included interviews with diverse individuals.
- The scorecard tied 10-15% of the manager bonus to diversity scorecard outcomes, and it embedded diversity in the performance appraisal, which determines merit increases.
- The scorecard tied 25% of the executive bonus to diversity scorecard outcomes.
- It set diversity and inclusion as one of the company’s six strategic goals.
- Sodexo coordinated diversity initiatives across hiring, development, promotion, and retention.
- It created a recruiter incentive system that provides rewards for diversity results.
- Sodexo established a separate diversity sourcing strategy.
The results include a 38% increase in qualified ethnically/racially diverse candidates and a 32% increase in qualified female candidates.
Best Retention Program: AIMCO
The work done by the recruiting team at AIMCO can only be described as breathtaking. Its “dollarization” of HR results, forward-looking predictive metrics, and general businesslike approach make even the iconic Google look like a has-been. I have researched AIMCO’s approach to HR, and I find it to be the one that everyone should emulate.
Some elements of its approach to retention that demonstrate its advanced thinking are:
- The company implemented a “chargeback” model, in which internal HR services must be competitive and effective in order to be utilized by managers.
- It established an extensive analytical framework to identify and predict turnover trends.
- AIMCO correlated turnover to Controllable Operating Net Income (CNOI) in order to demonstrate to managers that managing turnover is a significant contributor to meeting budget goals. Related findings include:
- Properties could expect to gain an average of over $16,000 in CNOI improvement per retained employee.
- Properties with less than 25% annualized turnover could expect 60% higher CNOI performance versus those with greater turnover.
- Salary waste alone can account for up to 3% of a property’s annual CNOI.
- On average, for every Community Manager who exits the company, eight additional employees will leave that property before it normalizes its operations.
- Every 1% increase in retention is equivalent to over $403,000 in recruiting and training costs, salary waste, and operational performance.
- It launched EE surveys at all stages of the employee lifecycle in order to collect information on turnover drivers and to drive predictive modeling efforts.
- For some jobs, it has reduced the time-to-fill by 10 days down to an amazing 20-day period by anticipating future needs and starting the recruitment process before an actual requisition is issued.
- AIMCO created an online card game for employees that assesses what is important to them individually and determines whether or not those preferences are strengths or weaknesses of their current jobs. A report is provided at the end of the game that provides each employee with an individualized action plan to drive engagement, productivity, and retention. (This innovative approach for identifying what motivates each individual employee in order to improve his or her productivity and retention is the best that I’ve seen anywhere in the world.)
- It developed a retention toolkit for managers.
- The company integrated retention-goal planning into each manager’s performance goals.
- AIMCO measures turnover eight different ways, including:
- Pre-productive turnover (its concept of demonstrating salary waste when losing an employee is an excellent example of dollarization). Working with the COO, it helps determine the point in an employee’s career when he or she begins to make a positive ROI. Individuals who leave before that point cost the firm and cause salary waste.
- Short-term turnover probability (predicting who’s at risk and where turnover is likely to occur is something that few firms have even attempted).
Most Innovative Employee Referral Program: AmTrust Bank
Clearly AmTrust Bank has demonstrated that a relatively small financial institution headquartered in Ohio can do some world-class work. Up to 78% of its hires come from employee referrals, which has allowed the bank to both reduce agency fees from 21% of budgeted recruiting expense down to about 3% and to avoid spending money on newspaper ads. The bank has found that these referral hires have no negative impact on diversity while excelling in on-the-job performance and retention.
Some compelling program features and results include:
- AmTrust Bank created the LINX referral program in 2006, which deputizes all employees to play key roles in recruiting.
- Its service level agreements guarantee response to all referrals within three business days. (I have found that responsiveness is the number one factor in successful employer referral programs.)
- It correlated turnover by department to staffing concentration by source. When ERP was revealed to produce lower turnover, it focused the sourcing strategy on referrals, which not only saved money, but drove company-wide turnover down by 18%. (It’s also important to correlate hiring sources with on-the-job performance in order to make your workforce more productive.)
- The company created an Employee Referral Advocate position solely dedicated to managing the program, which serves as the central point of contact for all employees and referrals.
- Referrals and referring employees are updated with quality feedback following each stage of the process. (Individual feedback to individual employees who make weak referrals is far superior to implementing onerous program rules.)
- Every company employee is provided with employer referral cards. But its program has an innovative element that randomly stops employees and asks them to produce a referral card. If they do, they are given a $50 reward for carrying them around.
- Leveraged monthly prize contests drive program participation.
- Total recruiting program savings total more than $500,000.
- AmTrust Bank established referral relationships with local diversity organizations to drive uptick in bilingual candidates.
- Program introduction is embedded in new-hire orientation.
- Referral bonuses are paid within 30 days of a candidate starting. The standard bonus is $500, although some hot jobs can receive up to $2,000.
Recruiting Department of the Year: Intuit
Once again, Michael McNeal has put together an outstanding team that continues to innovate, especially in the areas of workforce planning and statistical modeling.
Highlights of his team’s recent efforts include:
- It created an analyst position to develop predictive models that have been up to 98% accurate.
- The company centralized the sourcing function with its business unit, which aligned recruiters and program management teams with employment branding, employee referral, diversity, early-career talent pool, internal and external networking, candidate experience, and Internet sourcing.
- The separate Talent Acquisition Logistics team owns the post-hire, pre-start timeline to ensure new hires transition from candidates to employees smoothly. (Its broad view of the candidate experience lifecycle is the model to follow.)
- It established a talent acquisition planning model in which unit-aligned recruiters help managers determine what type of talent will best meet their operational needs. During this process, managers have access to workforce information regarding compensation, talent pools, diversity, alumni rehiring, referrals, and internal mobility.
- Talent Acquisition (TA) created a customized database that they call the “Bat Computer.” Just as the Batmobile allows Batman to respond quickly and save the day, the TA “Bat Computer” has drastically increased their productivity and efficiency. The tool takes information from their Applicant Tracking System (ATS), budget forecasts and actuals, hiring forecast and trend data, and other information to address business goals. This tool allows them to monitor TA performance, recruiter productivity, and candidate generation strategy performance, and highlight best practices immediately.
The results are reflected in its recent employee survey, which shows that overall employee satisfaction at Intuit is 4% higher than Sirota’s best-in-class rankings. For the seventh consecutive year, Intuit has ranked on Fortune magazine’s list of “100 Best Companies to Work For” in the U.S. Since 2005, its revenue per employee has increased. It is also spending less money to fill vacancies from voluntary and involuntary attrition.
Best College Recruiting Program: Ernst & Young
Ernst & Young (E&Y) once again demonstrates its leadership within its industry by updating one of the largest college recruiting programs (over 5,000 hires per year). By treating campuses like business clients, it has produced significant results.
Highlights of recent innovations include:
- Its program now touches over 300 business-school campuses in North America.
- It leverages former interns in their senior year as campus ambassadors. (This is a best practice that everyone should copy.)
- Ernst & Young used an online video development contest to get current students to write and produce videos starring themselves and talking about what was important to them in a career in professional services. The winning video team won a trip with E&Y’s CEO.
- The company leverages a campus-centric team approach to ensure strong relationship standards are fostered and maintained. Each campus team is comprised of:
- A campus coordinating partner, campus recruiter, campus champion (senior manager), and a diversity champion.
- Each team is also supported by additional professionals representing lines of service, geographies, etc.
- On average, large schools have teams ranging between 15-20 core members.
- E&Y chairman, executive board, and all vice chairs lead campus recruiting efforts by attending faculty conferences and speaking to student groups on site.
- Each business unit has five strategic goals related to campus recruiting in their balanced scorecards; many business units have now added campus recruiting goals into managers’ personal development plans.
- It established a recruiting strategy that embeds brand building into all student touchpoints throughout the academic lifecycle.
- E&Y is the most thorough corporate user of Facebook to enable delivery of targeted messaging to students and student groups using a channel/forum that students prefer. Its policy requires that all posts made by students on Facebook are responded to within 5 business days.
- It holds numerous conferences aimed at attracting diverse college students.
- Intern to full-time hire conversion rate is more than 90%.
- E&Y ranked as the #3 most desirable employer among business students according to Universum and #3 on Business Week‘s “Best Places to Launch a Career” list. It has also been named to Fortune‘s “Best Companies to Work For” list 10 years in a row.
- It reengineered its campus careers website to support a segmented-by-invitation application model (students who receive an invitation to apply are redirected to a customized online application). Highlights of its careers site include:
- It has vanity URLs for each major campus.
- There is a “Picture Yourself” tool that lets students see where in E&Y their majors and personal interests could take them, complete with real video interviews of people in those roles.
- The “E&Y 360″ lets students see day-in-the-life scenarios of actual employees.
- The website was rated #8 on Universum’s “Most Impressive Overall” ranking of employment websites among undergraduate students.
- Its careers site now accounts for 60% of all EY.com traffic.
Best Employer Brand: Ernst & Young
E&Y also won the award for the best employer brand, demonstrating once again that organizations with a strong heritage and conservative business standards can excel at innovation when the business demands it.
Highlights of its approach to employment branding include:
- Its brand is based on three pillars: inclusiveness, flexibility, and continuous learning/development.
- There are monthly e-mail opt-in news blasts.
- Its extensive Facebook profile, group, and messaging allow students to dialogue with one another and current E&Y employees about careers in professional services.
- The Facebook profile is refreshed weekly with new content.
- There is extensive leveraging of the business press and PR to position E&Y as a progressive employer capable of launching a phenomenal career.
- It built a culture campaign featuring stories of E&Y employees that replaced stale corporate policies. The stories were chosen to emphasize the “people first” culture elements once defined by policies.
- E&Y participates in corporate recognition contests like Fortune magazine’s “100 Best Companies to Work For” ranking, in which E&Y is the only “Big Four” company and one of a tiny handful of companies overall to be ranked consecutively for 10 years.
- Notice its recruiting stats regarding boomerangs: 24% of all managers and senior managers; 40% return within one year and 29% within 1-3 years. Plus 27% of professional hires come from employee referrals.
- Its world-class alumni program features a dedicated website, monthly newsletter, and a series of national, regional, and local events.
Most Effective Use of Staffing Metrics: Wipro
Around the globe, Wipro is cementing its position as one of the largest and most successful IT service and business process outsourcing companies. Once again this year, Wipro demonstrated that when it comes to building world-class business processes, its own HR organization is not exempt. This past year, the Bangalore, India-headquartered company:
- Leveraged risk auditors to associate the benefit/risk of recruiting performance to its bottom line. (Risk analysis is absent from most recruiting departments’ analytics.)
- Leveraged in-house quality analysts proficient in Six Sigma, LEAN, and TRIZ to continuously monitor and establish business performance-oriented metrics.
- Implemented a performance-management model that evaluates staffing function performance both pre- and post-hire.
- Segmented staffing metrics to focus on actives, passives, seniors, and alumni.
- Migrated all HR/recruiting data to an enterprise data warehouse, enabling extensive data modeling (predictive, associative, sequential, etc.).
- Created visual dashboards for all key stakeholders, including third-party vendors.
Best Corporate Careers Site: KPMG
KPMG is another firm that is innovating in a traditionally conservative industry. This year, it focused on revamping its corporate careers site to allow anyone to explore how its education and personal interests relate to opportunities at KPMG.
Some highlights of its new approach include:
- Employee Career Architecture allows visitors to explore career options with an interactive “build your own career path” mapping tool. (Interactivity and personalization are critical factors in careers website development.)
- A “matching majors” function allows college students to see what careers at KPMG leverage their majors and vice versa in order to explore what types of courses are required to pursue a career path that interests them at the company.
- A quick poll with live results features a periodic question about candidate-job expectations. Visitors who participate can see the results immediately.
- Its Career Journey video series profiles real KPMG employees ranging in roles from interns to partners.
- Weekly Web design and content refresh meetings ensure that the site content is always fresh.
Most Strategic Use of Recruiting Technology: TruGreen
The design of this company’s process demonstrates deep insight into the future of recruiting, in which statistics and modeling will help firms predict business problems and opportunities utilizing people-related data. When it comes to organizations demonstrating that HR can not only partner but contribute directly to the business, this national landscaping arm of Service Master leads the way.
Groundbreaking efforts taken this past year include:
- It architected a Recruiting Decision Support System to enable the recruiting function to answer several key business strategy questions related to talent, such as: Does the talent actually exist in all markets? Within the allocated compensation levels, can the talent be acquired? Will recruiting resources be required to support regional operations?
- The system enables TruGreen to proactively and scientifically assess the probability, risks, and strategic impact that hiring will have on planned capital expansion and growth.
- The system leverages millions of records of procured data on occupations, skills, competencies, wages, and demographics to predict using a single numerical, indexed value for the availability/scarcity of talent pools to meet growth predictions in 229 defined expansion markets.
- The predictive model is used to drive all elements of a geographically-segmented recruiting strategy.
The award recipients highlighted here deserve to be congratulated, and I would like to thank them for pushing the envelope in recruiting and HR. It should be obvious from both the record attendance and the tone of this year’s Expo that the war for talent is still going strong.
Everyone should also take note that the rate of innovation in recruiting is increasing and that the one overriding trend is that recruiting is becoming more businesslike. More and more recruiting functions are leveraging statistical modeling and heuristics to anticipate and manage future events. This trend means that more and more decisions in recruiting will be made based on data and facts, rather than on intuition and tradition. If you’re behind in developing advanced metrics, you will soon be non-competitive.