It’s The Sales Model, Stupid!!
Whatever the industry cheerleaders will have you believe, there can be little doubt that the recruitment sector is facing critical problems that whilst not terminal, could be very damaging. Threats from direct sourcing, downward pressure on fees and timescales, upward pressure on candidate and regulatory volumes, increasing service demands and expectations from clients and candidates, and the advocacy that social media brings enabling poor practice and experience to be communicated widely and quickly, will inevitably create burdens that many underfunded, complacent, inflexible recruiters will struggle to see off.
The debate has raged again in the blogosphere this week with a quite stark view from @theHRD on this blog. Needless to say, it attracted opinion on both sides, and the debate immediately moved to figures and semantics…always a stifler to any argument of ideas, ideals and passion.
Only a few commentators picked up on the obvious fact…this piece was written by a client. The HR Director of a fairly major (so we believe) business who would almost certainly a ‘sales’ target for pretty much every 3rd party recruiter in the UK and here he was telling the industry that the party was over, the days of high volumes and big bonus cheques were probably disappearing fast…and what was the initial reaction?
To disagree with him!
Can you think of any other industry in which a customer telling you that your offering is poor, outdated and no longer does what is wanted would be told that he was wrong??
I wouldn’t mind but the industry prides itself on being a sales led industry…and what is one of the first things a trainee salesman learns? Don’t say ‘yes, but’! You don’t win business from someone by disagreeing with them and telling them they’re wrong.
But then optimism, whether unfounded or real, is a key driver for a sales business.
So what’s the main thing wrong with recruitment industry in my opinion?
It’s the transactional sales model!!
It’s been unchanged for 50 years and there seems no appetite to change it now. Not when it’s made many people wealthy in the past. I can’t think of another business sector that has a standard operating model that has been unchanged for so long.
Before I go on, let me try and establish a case for having such a strong opinion on this. It’s not just thrown together! I have been a billing recruiter, month after month, for over 20 years. I spent a number of those years placing recruiters, during which time I must have interviewed at least 3000 experienced and trainee recruiters and sat in well over 500 client meetings where I have been briefed by directors/managers of agencies on their requirements, culture, values and goals.
When you look at the recruiter behaviours that most annoy candidates and clients I believe they can all be traced back to the transactional sales model. So let’s consider a few inconvenient truths about the sales model. For starters…
It makes the recruitment process all about the fee and not about the person.
Yep, it sure does. Number one target for any recruiter is fees. Don’t bring in the fees; you don’t keep your job. In fact I can think of few business sectors in which an employee can have a clause in their employment contract which states that failure to meet targets for 2 consecutive months will lead to a written warning. I have seen these contracts and people sign them. Unbelievable short-termism. Similarly I cannot think of another industry in which an employee can be told that they are now on a commission only deal, and if they don’t like it they can leave. Yep, I’ve seen that too. In fact I’ve heard directors talk of having done it. In a tough market, with pressures on all sides, those fees have to be made…and when your job could be at stake, that’s quite a pressure.
There’s no money in candidate experience.
Damn right there’s not! (Irony alert) Well, there’s not if you’re measured on fees, jobs bought in, interviews, CVs submitted, and interviews gained with client. Why spend an hour interviewing someone you can’t place in a job this month? Why spend a few minutes ringing back candidates who have applied but aren’t relevant? Get on the phone…find a new vacancy or find a candidate you can place. This isn’t a guess on my part…it’s something I have been told many times by recruiters.
As I’ve blogged before, in my company we have a team who speak to every single candidate who applies for a role. They don’t have targets. A year on I have still to find another recruitment business that understands the value in a candidate facing team that have no fee or activity targets.**
No time for feedback.
I blogged about this last year…inspired mainly by a comment from a recruiter in another business who told a candidate chasing feedback “To be fair if we spent all day phoning people who were ‘no’, which we’d like to do because it’s the ‘experience’ as much as anything that counts, we simply would go bust”. So there you have it from the horse’s mouth. No money in feedback…get back on that phone and cold call. If you spend time talking to unsuccessful candidates you’ll go out of business.
Inappropriate and poorly matched CVs sent to clients.
Another metric favoured by agencies is number of send outs. It also pays to send as many CVs as possible, in case a competitor sends the candidate over. More CVs may also get you more chance of interviews…it’s all a numbers game. And it’s sticking to the numbers that will keep you in your job.
I could go on, but that’s enough for now.
None of this should come as a surprise to regular readers. My first ever blog was about how I believed that tomorrow’s recruiter should be incentivised on feedback not fees. I’ve recently blogged on how business communication is changing and how business to business sales is changing.
This isn’t an anti recruitment industry rant. Anyone who was at the last Recruiters Networking evening would have heard me debate passionately in support of the industry. It’s the way we operate that needs to change. The transactional sales model rewards behaviours that have gradually dragged us in to disrepute…which is probably the biggest inconvenient truth of all.
I am also lucky enough to work within a business that rewards on client and candidate feedback and is prepared to invest in areas that do not lead to immediate fees, but provide a service and experience to the candidates and clients who use us.
At least the recruitment industry apologists all seem to agree that behaviours have to change…but my question would be how…without changing the operating model? You can’t change the way people behave without changing the way they are rewarded and motivated, and they way that their performance is measured.
I just scanned some online ads for recruiters and picked up these essential qualities:
‘Successful candidates will have a good academic background, but most importantly will be focused on entering a target driven environment where there is the opportunity for rapid career progression as well as significant earning potential within the first 12 months’
‘You must be hardworking, driven and determined with a strong aspiration to make a lot of money and a desire for success’
‘The role is a traditional recruitment position involving, winning, maintaining and developing business. You will do this in a mature environment and have the ability to work both autonomously and also as part of a team’
‘You will not be afraid to pick up the phone and enjoy business development as this is a key part of the role’
‘You will be a graduate with some sales experience’
These people will be looking after your careers and recruitment processes.
Reading that lot, I can’t see behaviours changing anytime soon…can you?
** Previous posts mentioned are: