Toby’s 3R Rant

About thirty years ago the western world passed laws to stop discrimination in recruitment against older workers, migrants, women, etc. Advertisers are not allowed to put age or gender preferences on ads. They can‘t even do it in a long-winded way by saying, ‘we are seeking a graduate with three or four years of experience’.

So, many people go to a lot of trouble replying, believing they have a chance. Their age is guessed (often wrongly) and they are tossed on the reject pile. Or the employer has to waste 30 minutes going through the rejection process.

What’s wrong with this? We’ve ended up with the worst of all worlds. Discrimination and a huge waste of time and resources.

We just drove the problem underground, we kept it hidden by attacking the symptom (the advertisement) and not the problem (ignorance and fear).

We fail to confront the ignorant and shine a light on their stupidity. They get away with it. Today, tomorrow ….

This should worry all of us,

Cheers, Toby

Imagine a giant fruit and veg market supplying a major city. One that works really badly. Totally sucks.

This market only opens at night and there are no lights to guide the thousands trying to find what they need. It has many hundreds of separate halls, each selling only a few things – some only sell root vegetables, others just stone fruit. And maybe 10 have apples.

Now, you’re trying to find small green cooking apples. One hall, somewhere, has these.

Each of the hundreds of halls is completely separate from all the others and when you go to one, the wholesalers only tell you about what they have to sell.

The people stumbling around in the dark have no idea what they’ll find in each sealed hall until they open the door and walk inside – what a waste of time.

Who owns these ‘halls’ in perhaps the most important market place in any country, the jobs market? Three types exist:

1. Recruitment agencies, there are thousands and each has a few jobs and a few candidates for sale – usually not exclusive to just their agency.
2. The many different newspapers with job ads in particular industries or sectors.
3. Finally, lots of job boards and many community sites that host jobs.

Total chaos.

There is a better market place and it’s here today – one that is brightly lit, fast and user friendly. It’s job boards – monster.com and seek.com.au. They will work if we stop sabotaging them with the thousands of other ‘halls’ that just get in the way.

Without all the clutter of newspaper ads and too many recruiters, you will find the ‘green apple suppliers’ in a few seconds: and then start the real job – spending time finding the best at a good price.

200 Australians have it in their power to make it happen now: the senior people in HR. Maybe a thousand in the United States and the UK, but still a small number of people. Forward this article to them, start making a difference.

Worth it? You do the maths – millions are in the wrong jobs and companies are screaming for skills.

Cheers, Toby

If someone had an insight to make our economy significantly more productive. And our people a lot happier. And would cost nothing and could happen virtually immediately, of course he would be listened to.

Not.

Instead it’s ‘business as usual’. While one of our most important market places, the market that drives the entire economy, the market for jobs, is a mess.

The internet could fix it NOW. As I’ve shown.

It’s being blocked. For reasons I’ve explained ad-nauseum.

It COULD start next week. With major benefits in just a few months.

Important? Unbelievably so.

Why doesn’t it happen? You tell me,

Toby

P.S. Some possible ‘reasons’ why:

1. People rarely see the bleeding
obvious when it is first pointed out.

2. “These ideas persist not by inertia alone
but also because they are convenient to
powerful vested interests.” J.K. Galbraith

3. Toby is just a blogger. The only people
who publish him are the recruitment
industry press - not the mass media.

4. People get confused as the
issues seem complex.

5. That basic economics is beyond
many business people.

Corruption hunters follow the money trail. They learn who benefits. They explore how far the corrupt will go to protect their scams.

It’s the same with unprofessional behaviour and secret commissions ….

Bob’s story

Bob runs a great manufacturing and exporting business but his accounting affairs got a bit complicated recently, so he decided to get a top flight accountant to sort out the mess – he went to Simon, a partner of a Big 4 Firm. Simon charges like a wounded bull but it’s a big prestigious firm so Bob decided he must be worth it.

Simon recommended some software as essential to solving Bob’s problems, and while it’s WAY more expensive than all the competing products, Simon said it’s the best. It added $12,000, about 40% to Simon’s quote which didn’t thrill him. But what Bob knows about accounting is not worth knowing – Simon’s the expert so he signed the cheque.

Would Simon’s advice have been accepted if Bob knew Mega Firm was trousering 25% of the $12,000? And Simon was personally putting an extra thousand in his own pocket?

Might Bob have explored the alternative products, most costing less than 10% of Simon’s?

Undisclosed commissions are considered dodgy in the accounting profession – but are everyday practice in recruitment.

When a recruitment consultant from a big firm says that solving your problem will need an advertisement at the front of the newspaper that costs $12,000, the reaction of most employers is like Bob’s: It’s a lot of money but he’s the expert and good people are hard to find. Better write a cheque.

And yes Josephine, recruiters do take commissions for selling ads – they buy wholesale and sell at retail. And some have used dummy invoices to conceal the practice from their clients. And some firms have paid their ‘consultants’ up to a $1000 for selling them.

Does that motivate the ‘consultant’ to hard sell an ad? Maybe a little.

What about if their commission structure was linked to selling 3 ads every quarter – and they stood to make an extra $10,000 or even $20,000 a year if they sell them?

How much pressure will the ‘consultant’ put on their client to buy an ad when they are one ad short of their quarterly quota? With THOUSANDS riding on it? The client will feel some heat. Lots. (To feel the pressure, read all about Friday Night Specials - go to the end of the article that opens)

In the big firms, nearly ALL their strategic focus is on selling the giant ads which gives millions a year in free publicity.

But hey, it’s not free publicity! They make a cash profit!

So you’d better believe they care. Reminds me of a pride of lions - with the dominant firms holding the front of the paper (the high ground). The young males constantly challenge them for the prize, inching closer to the front of the paper (the front is better than sex for these lions!).

It’s full on warfare - has been for about 30 years. Winners: large recruiters. Losers: employers!

Their position at the front of the paper underpins everything the big firms do. It gets them huge profile and market position. All paid for by naive clients who believe the ads are useful as an expert told them.

No. Just a salesman.

WHY ARE THE GIANT ADS THE SAME AS THE CANE TOADS that have invaded Australia? They are ….

Bloated, ugly, destructive and shouldn’t blo.dy well exist!

My argument against Cane Toad Ads?

They don’t work; they only benefit the big recruitment firms; they damage our economy; ruin careers and damage lives; and they promote unprofessional behaviour due to the secret commissions paid.

Why don’t they work? We’ll cover that in the next Rant, just assume they don’t for the moment - but if you really need to know, the reasons are here.

Why do they cause so much damage? Well, newspaper ads fragment the market in an area where the internet is perfect for the INITIAL matching of people to jobs. Fragmenting makes it more inefficient so companies find it harder to find people. And people find it harder to find better jobs.

IT’S ALL ABOUT THE THEORY OF MARKET PLACES. An efficient one always has lots of buyers and sellers in one place.

Now this is complicated to explain in a Rant (for a fuller but still simple explanation), but here’s the Very Simple Guide: Think about a boat show – like the one in Sydney at the moment. Not surprisingly, they put all the boats in one place, Darling Harbour.

Imagine the chaos if we scattered them over 10 different locations, with a random mixture of different boats at each?

Well, that’s recruitment. Twenty or more different ‘market places’ for each type of job including: newspapers, large recruitment firms and the internet. The only place ads should be is the internet – and Cane Toads are the main blockage to this efficient market.

Do you think big recruiting firms would spend so much time and money pushing Cane Toads if their rewards weren’t huge?

Come on HR! There are better uses for your company’s money. Stopping the Cane Toad Gravy Train is a giant stride towards making the recruitment industry more effective.

So far there is no magic bullet for real Cane Toads – but their is for the recruiting equivalent. A bullet a mere 200 people have and can fire at will.

Who? The 200 HR managers in the organisations who buy Cane Toad Ads.

Just say no. Today.

It’s worth billions to our economy. And a huge growth in happiness.

Cane Toad Ads are a naked, very ugly emperor with no reason to keep living.

Do large newspaper ads work and are they value for money? In the days before My Career, Seek and Monster the answer was sometimes. Today it’s NEVER.

Australia is unusual in having large numbers of expensive recruitment ads at the front of the papers. Some countries have a few but nothing to the extent that we do. We have a mass of recruitment agency-controlled ads and all are large and expensive. And these ads are bought in blocks by the recruiter ahead of time - and at wholesale prices.

Why is there incredible pressure to sell mass media ads at the big firms? There are at least five reasons:

1. It’s great free advertising - the ads raise the ‘profile’ of the firm, making them top of mind with clients and applicants. Their clients are unknowingly paying for their corporate positioning - or perhaps they do know but just feel they have no choice.
2. Applicants who are not suitable for the advertised role (that the client paid for) are sold to other companies. If he can’t get a quick sale, the recruiter gets new resumes that he can ‘reverse market’ to lots of other employers at the same time.
3. Many firms buy the ads wholesale, and sell retail. Some even put hidden ‘production costs’ on top of the retail price - they get two hidden fees. One firm I know adds 15% for ‘production costs’ as part of their normal business practice. This brings in a lot of $$s their clients are never told about.
4. All space is pre-booked. What page your agency’s ads run on is decided by how many you sell each week. On a regular basis, the newspaper assesses each group’s usage. If yours has fallen, another recruitment firm may be allocated some of your space. Or, even worse, you swap places in the paper - they come forward and you slide back to the pages few readers reach. Talk about strategic pressure to keep selling.
5. At least one of the major firms in Australia pays a hidden commission to their recruiters for each ad sold. As at mid 2005, this was $900 pretax. Quite an incentive for them to persuade their clients that an ad is the best solution. An even bigger incentive are the bonuses for reaching their ad sales quota for the quarter – which can earn them $10,000 or $20,000 extra.

Try this question on ‘consultants’ who are pushing a mega ad onto you:

“Ok, you clearly believe this expensive ad will find us good people. Are you happy for a panel of recruitment experts to evaluate it’s effectiveness at the end of the campaign, and then allow them to publish their conclusions? And if those are negative, will you rebate me some of the cost of the ad?”

Tough question! Should sort out the women from the girls!

Who would be on the Panel? Me for one and happy to find some more volunteers.

The panel’s brief? Assess the costs versus the salesman’s claims, and identify where good applicants were actually sourced.

For example, how many came from Search if the role is a senior one - and ask for their research files to see if they actually did any Search. Easy for them to claim they did, so asking for proof will keep the basta.ds honest.

The panel would then publish their conclusions in the mass media (or after August 16th at www.recruitershamefile.com) - in most cases this would be deeply embarrassing. Of course just asking the question makes it unlikely you will have wasted your money. Only a very brave or foolish ‘consultant’ would persist with selling you an ad on these terms - or one who was totally convinced that in this particular case it would work.

The pressure on the ‘consultants’ to sell these ads is intense, and the main focus of their internal weekly sales meetings. Directors often prowl these meetings intimidating ‘consultants’ - where I used to work, they walked around the table where we all sat waiting for our turn to be picked on! When I started my career over 19 years ago this was the practice - from talking to people who have recently left the large firms, the not-so-subtle intimidation may have become even worse. At least in my day my commission cheques weren’t linked to having to sell ads and no-one slipped $500 into my pocket when I did.

So, the large ads benefit the agencies and the media. Not the sucker that paid the bill.

How do they get away with selling so many expensive, wasteful ads?

There are four reasons why this incredible con continues:

1. Their sales pitch is built around the plausible sounding ‘attract the browser’ argument – the absurdity of this argument is shown below.

2. “They are a big, successful firm who are experts in recruiting - they know about these things, and if they tell us we need to spend $12,000, then we had better do it.” Remember, most managers or professionals only recruit once or twice a year and few know much about the secretive recruitment industry.

3. Some ads actually do work. They do catch some browsers - it is just that they are atrociously wasteful in terms of the ‘cost per appropriate applicant’ - surely the only valid measure of value. And given the Mega recruitment firms obsession with tracking and reporting on activity and results, it might surprise some people that they don’t track this. If they do, no surprise that they don’t share it.

4. Finally, who is to know whether the ad worked anyway? The applicant who finally got the job could have come from anywhere, and rarely is any tracking done. Remember that big firms have a high profile because they sell so many ads with their logo and other branding taking up a huge chunk of the expensive space. So applicants come to them directly, even if they didn’t see the ad (and that would be fine if they were blo.dy well paying for it).

The ‘browser’ sales pitch

I learnt this pitch 19 years ago when I worked at a giant recruiter with hundreds of ‘consultants’: it was drummed into us at the weekly sales meetings. We were made to practice it on each other and in front of the mirror. You had better believe that this pitch is the foundation stone of Australia’s major recruitment firms.

The pitch is simple, plausible and seemingly valid: people read the front of the newspaper, and their eye is caught by an advertisement so they become interested in it and apply. They are argued to be better applicants because they are more likely to be happy in their current job and therefore likely to be good at what they do. And of course, would not see jobs where active job seekers go to look - online or in classifieds.

Who could argue with something so self-evident??

No surprises that I’ll have a go. There are 3 counter arguments that rubbish the whole sales pitch:

Firstly one that came to me at 4.30 a.m. on a recent Cold August Night, the hour when all good ideas roam in a fevered brain. In the 3 years since I wrote a version of this Rant in my book, Get Great People, I had thought there were only 2 main counter arguments. This final one is the Big Momma - the last and very large nail in what is now virtually a metal coffin:

That we have moved to a world of Free Agents and the Internet. Where people manage and assess their careers constantly (even if usually not particularly well!). A world where people under 40 (Gen x and Gen Y) consider themselves independent of their employers, even if they enjoy their jobs. That they have a life outside work, or in more extreme cases, that they have a life, and work is just a small component of that. Something that many of us Boomers have also come to believe and live our lives by.

In this world, the Free Agents browse 10 or 20 or a 100 websites a week (even I, a geriatric, am on at least 20 different sites every week). And one of the sites they go to is MyCareer, Seek or Monster. Just for a look. To keep in touch. Because you never know. And what about all those niche job boards attached to professional forum sites: LOTS of browsers on those. And what about the snowballing LinkedIn and Facebook and all the other social networking sites. Full of browsers. Full of recruiters.

And because it is so easy to apply for jobs with just a few clicks they are more likely to make an enquiry than that browser reading the paper in a cafe or their garden.

Now, if the price was about the same, the ad salesman just might have a point. But we are talking chalk and cheese on cost. Not in the same ball park. A $100 versus many thousands.

So, you tell me:

Who are the browsers? Where are the browsers? And, in particular, where do the browsers go who in this ageist world are the most sought after by employers? Reckon there are way more of these valuable young applicants on the job boards and social network sites than there are reading the Early General News in the Saturday papers.

Maybe the ad salesman is looking a bit like a seller of dodgy cars - even before we get to the other two reasons ….

Secondly, we read the Saturday pages ‘eyes up’.

If there were only 2 or 3 job ads on a page, and they were designed to attract the eye, no problem attracting eyeballs. That’s the argument of all advertising agencies and media sales people and it’s completely valid.

With recruitment, all the ads are in a block at the bottom of the page. Or, even worse, they are on a whole page by themselves when you get towards the back! Great for browsers!

I can remember the incredible hubris one Friday when I was at a Mega Firm and we had sold a whole broadsheet page of ads - it was all us! We were so proud! We were the champions! But hey, didn’t we forget something: what sort of insane browser browses a whole page of ads!? Maybe a desperate job seeker?

The ads are all the same size and all look pretty much the same - even better they are now in color so stand out like the proverbial dog ba.ls. They are also conveniently located in the bottom half of the paper - so handy for folding the broadsheet in half as I lie in my deckchair on Saturday morning!

So after 30 years of such ads, those browsers know where the ads are - they know to keep their eyes focused on the top of the page. That is where they find what they are looking for: something interesting to read.

I don’t have any major research to quote, but I have talked to a lot of people - it is quite common to read the Saturday papers ‘eyes up’. Don’t you?

Thirdly, the Saturday papers are now conveniently divided into sections.

The sections help readers find the bits they want to read. And in what order they want to read. And of course it helps in selling ads to particular demographics (now there’s a thought: recruiters could place ads in sections that attract who they are trying to employ?!)

With the sections, many of us have developed very idiosyncratic ways of reading. Take how I read the Saturday SMH (apologies for those who don’t live in Sydney):

I start with the front page; quick glance at the back page for some scurrilous gossip; Mike Carlton and Peter Fitzsimons for a laugh; rugby news; the rest of News Review; Spectrum; and sometimes the Good Weekend. And finally, if I get through all that, I turn to the news bits where the recruitment ads are - pages 2 to about 20 - and religiously keep my eyes up. But most weekends I don’t get to it.

Again, no research on readership that I can quote, just an informal survey of professionals; but it is common practice to read selectively. Of course the newspapers do lots of market research, which lead them to create sections in the first place.

So, three strong reasons that rubbish the browser sales pitch - just tell the advertising salesman masquerading as a consultant to go and spin his B.S. to someone else.

Love to hear your stories of ‘consultants’ trying to sell you ads. Or, even better, a recruiter defending them!

Spurious Advertising research by Mr Ad Salesman

Ad salesmen have a standard pitch that goes like: “Mr client, only a tiny percentage of applicants who end up on the final shortlist are ever on a recruiter’s database. The best candidates are not actively searching for a job - we need to attract them to apply with an advertisement that catches the eye as they are browsing through the Saturday morning papers.”

A regular speaker to our industry runs a firm that sells giant ads. At a conference 3 years ago he asked the 110 recruiters in his audience: “What percentage of those who are ultimately short-listed were previously on ANY agency’s database?” I proffered a guess of “less than 10%” - obviously he wanted a low number and I wanted my ‘gold star’ for the right answer!

Now he is one of the doyens of our industry and has been financially very successful. Most of what he was telling us was great stuff about how to be a more productive as a recruiter - overall a great presentation which was well received.

He triumphantly and emphatically came back with “research shows it is less than 5%”

Extraordinary and a great sales tool if true so I wanted to track it down. But as I doubted it was true, it would have been aggressive to challenge him publicly (I was also on the speaking programme, though with a much smaller role) – after he finished I asked “could you tell me where to find this research?”

The answer and his body language were classic: He looked down, started to turn away and said “Oh, it’s old research, not sure where it is now”. And continued to turn away, and started speaking to someone else!

And no, he didn’t know me (it was before I published my book), and I had had a shower that morning.

Now, that got me thinking. Firstly, doing such research would be virtually impossible, as it would mean tracking each candidate’s job search. Very time-consuming and also candidates might not want to admit how hard they’ve been trying (and by definition, not successfully). Also, having just been rejected by an agency they may not be favourably inclined to help an agency do research. It would also be very expensive - who would care enough to spend maybe $50,000 with a research firm?

Easier to invent a figure that sounds plausible in front of an audience that wants to believe it.

Takes some chutzpah to create facts that are so easy to challenge, particularly when you are being paid a hefty fee to provide expert training. But …. maybe not. No-one else seemed to notice.

Secondly, on reflection, I believe the figure is actually much higher, more like 20 or 30% - remember it was any agencies books. But, as with the presenter, I have no evidence, just a feeling from years in the trenches – and I have no particular axe to grind. I don’t sell $12,000 ads that are virtually useless.

Thirdly, his usage of the words ‘old research’ is interesting. The world of advertising has changed a lot – if the research is so old that he and can’t find it, maybe that is another clue that it ain’t true, in the unlikely event it ever was.

If you want to sell expensive ads, and he and his company do, “less than 5%, proven by research” is a seductive sales pitch. Shame it’s a bald faced lie.

The Day the Victory Bell Wouldn’t Stop Ringing - The Completely Useless $35,000 Ad Campaign

I briefly worked at a Mega recruitment firm, back in the day when the internet was just for nerds.

We had a large brass bell hanging in the middle of the office - you rang it when you made a sale of an ad or a body. Crass I know, but lots of sales teams have them and we were in no doubt that that’s what we were - the bell kept the team focused on what really mattered to recruiters!

The bell started ringing one day. And kept ringing. And ringing.

The ‘consultant’ had just returned from visiting new clients - a restaurant chain was opening in Australia and needed 200 staff. The ‘consultant’ had sold the client the equivalent of 4 large ads in the front of the Herald, more than $35,000 in today’s money. He had sold 40% of the firm’s maximum pre-booked space for the week. He was only one of 15 recruiters in Sydney so it was quite a coup - our biggest ad sale in about 4 months.

That night we went off to celebrate with the Managing Director shouting the first drink. Later I asked the excited and merry ‘consultant’ about it, saying it seemed unlikely applicants would come from the front of the Herald - not the first reading choice of many kitchen staff.

His response with a huge smirk on his face? “Hey! My client also paid $2000 for lineage (classified) ads in the back of the Herald and Telegraph, that will fill the jobs.” And the cheap ads did, with barely one applicant from the quarter-page extravaganza.

His client, the poor restaurant chain, had made a sizeable and greatly appreciated donation to our firm’s profile and helped us hold onto our much valued position on pages 5 and 6.

Does it still happen? You bet.

Friday Night Specials - “Have we got a deal for you!”

I cringe remembering Friday Specials from my 12 months working at Mega Firm.

About every 3 weeks, usually late in the morning on a Friday, we were summoned to a quick stand up meeting around the Victory Bell and told “we have some discount ads to offer our clients”.

Our Director would ask each of us for the names of 2 or 3 clients to call - if we were reticent, he would suggest a few names.

We then trotted off to ring them and offer them a discount on ads in Saturday’s newspapers. The discount often started at 25%, getting rid of our wholesaler’s profit. By 2 p.m. it would fall to half price. Occasionally, if it was still not sold, we would have to run a filler ad for ourselves – a big loss so the company hated this.

One Friday I rang a good client with the special offer and got a very aggressive response

“Why do you have all these ads to sell?? Why is there such a panic? You don’t even know what I need! What’s in it for you?”

He was simultaneously both angry and confused - unusually he had been rung 3 times in just 6 weeks. As a good ad salesman who still half believed they worked, I gave him the company line: That we had had a last minute cancellation so are offering our good clients “the opportunity to be at the front of the paper at a great price”. But it got me thinking about these constant specials, and what this new industry I had joined was really up to.

The real reason why Friday Night Specials happened so often? Because on Tuesday we had to commit to how much space in Saturday’s paper we could sell to our clients. And there was always pressure on management to take a couple of extra ads to ensure we maintained our spot at the front of the paper (your position is based on how many you sell over the quarter versus the other firms). So we often had trouble selling the last few spots that our optimistic and hopeful managers believed we could achieve so they would get their bonus (remember, the entire strategy of these firms is based on their position in the paper and the free publicity from the ads.)

The loss to the firm if they couldn’t sell the ads, given the exorbitant prices, was significant. So the kudos you got for flogging these specials to a gullible client was huge - and lasted until the next time it happened. When you had to prove you had cojones once again.

Still happens? Of course.

Now, I can hear some of you say: Ok, guess we got the message that you don’t like the big ads at the front. What do you say about those at the back of the newspapers? The Classifieds.

Not one redeeming feature. Nothing. Zip. A complete waste of money. They just clutter up the job market and make it more inefficient.

Random words that spring to mind: Trees; Stumbling through a dense fog; Slow; Time waste; Dumb

Cheers, Toby

It’s a hot February night in 1994 and a bunch of recruiters are drowning their sorrows in a bar overlooking the Sydney Opera House.

It had been a long day at a Human Resources conference where the last session was on ‘Working with Recruiters’. This had morphed into ‘Let’s bash Recruiters’ – 3 senior HR managers politely but bluntly dumping on the industry.

One sorrow drowner was an industry veteran and Peter said something 14 years ago that stayed with me:

“Most employers see our role as just finding people – simply sending in resumes. The real value we could provide is reducing the RISK of making a wrong hire.
But in our industry 95% of recruiters offer their services for free so employers don’t know this is an option. That this is a service that could be included for the same price they ultimately pay.
It’s very hard to sell our services and seek a commitment when employers can just ring these contingent recruiters, pay them nothing and they start work. But as we know, such recruiters work for themselves and not in partnership with their clients - it’s all about the fees.
The big firms attract a lot of candidates because of those giant advertisements their clients pay for. So they are good at getting candidates and sending them out to many clients at once.
No wonder recruiting has such a bad reputation!”

We returned to our drinks and frustration, but those words stuck as they explained the problem so neatly.

Size mattered 14 years ago but here’s the thing …..

Online a small recruitment firm is now as big as it wants to be. If you can work the search engines and networking sites and specialise in a field, you can compete with the big firms. Boutiques can just as easily find candidates.

In this brave new world, what do employers REALLY need from recruiters?

They need a warts and all discussion of the shortlist and advice on who is really the best candidate. But employers get unbiased advice only if their recruiter gets paid something regardless of who gets hired or even if no-one does.

You don’t pay your accountant or architect contingently, why is a recruiter so different?

Well there is often a good reason - many are just sales people and expert advice is beyond them. How to find those who don’t just sell bodies is next week’s Rant. It’s certainly not the ‘English backpacker’ who is so pervasive and damaging in our industry: their motto is “sell hard, not here next year to clean up the mess!”

The world has changed and there are more recruiters who work in partnership with their clients. There are MANY more who would like to help their clients reduce the risks of hiring the wrong person – they know hiring is hard and teamwork is critical.

Employers now have the choice to work this way. To decide not to brief multiple agencies for a single job (we’ll look at how that destroys your Employment Brand in a future Rant).

Why pay for a service and get less than half of it? In fact, why pay the entire fee when the person starts – what about the recruiter holding some back for retention? Abacus does this – why don’t more employers demand it?

Next Week: Recruiters who don’t just throw bodies – how do you find them?

Well, what we all want from jobs, but they actually expect it and walk without it.

Accused by Boomers with being demanding and fragile, it’s more that they value feedback and input. It’s not that they are slackers or easily distracted as much as they want to enjoy work, and they value lifestyle and balance. Also, they are on-line a lot. There is a real blur between their social and work lives, both online and offline.

Now, you can’t give them everything that we discuss below: some of these are privileges to be earned, they are not a right. A critical part of managing the young is about controlling their expectations. And managing them well and keeping them with you and productive is rarely about the money.

The specifics:

• They want a workplace where they can belong, which is stress-free and social. One which values the triple bottom line - not just profits, but also the environment and people (socio-economic concerns).
• Make the workplace fun: perhaps a relaxed dress code, fun photo boards/noticeboards, regular celebrations (birthdays, achievements, new clients), supporting their favourite charities etc.
• They don’t respond well to a lot of rules, managers who say “because I said so” or “that’s how we do it here”, who don’t say thank you enough, or sterile, lifeless offices.
• Training that helps their career not just the work they are doing for you; meetings where they can participate, interact - and have some food.
• They value feedback: from handwritten notes or cards (unusual, so it stands out), non-cash rewards (movie tickets, itunes vouchers etc) to formal recognition (certificates, references). Negative feedback? Absolutely; but always constructive, ask permission to give it and do it immediately so it’s relevant.

The reality: There will always be lower retention rates for this generation but it can be improved.

Some tips for improving retention and keeping them for the long haul:

Accessibility: take the mystery out of how you make decisions – the young grew up in smaller families where they were involved in family decisions. They expect it.

Variety: give junior staff greater responsibility and more variety in their work. For example, let them manage a project such introducing a new piece of software; give presentations; and organise staff events (they’ll do stuff they enjoy – get used to it!).

Understand the revolving door: if they leave for a new job, or further study: keep in touch - they may want to return. They rejoin you with new experience plus both sides know each other – great for your productivity. Always allow for the big overseas trip: applies to Australians as well as most European countries: let them go, welcome them back with a gift. The ones that travel are often the very best.

A final comment: young people now travel in packs, with highly developed networks and a strong sense of individual and group identity. They have a strong personal brand. Your employer brand must recognize, accept and embrace this.

It’s amazing.

Graduate from university and you are paid $50,000 or more, have a big training budget and lots of expensive management attention.

12 months earlier and all you could do was flip burgers.

How does this miracle happen? It’s the same ‘miracle’ parents perform in the 4 years when their stroppy teenagers go from 16 to 20. The children turn 20 and are surprised how much their parents learned in just a couple of years!

The students were always capable of more than burgers or pulling beers. Capable of making much greater contributions to employers.

So what does western society do with the best qualified generation ever with their great ability to learn complex technology? Well, lets give them repetitive and menial jobs. Hire them casually. No responsibility. Tolerate other employees treating the students badly as they are only temporary. And often sack them with a week’s notice or less.

Amazing!

This is just one of the large pools of talent that we ignore in white collar work. If 100,000 to 150,000 of our better students in Australia (and comparable numbers in other countries) were doing higher skilled, more responsible part-time jobs, it would have a big impact on Australia’s overall productivity.

Who would do the jobs the students were doing previously? Leave the detailed analysis to the economics guru, Ross Gittens. However, about 5 forces get triggered. For example, more of these low level jobs head off to India; the price of labour for making burgers goes up, so more automated equipment is bought; the price of burgers goes up, so some people buy less, etc.

One thing is guaranteed: there is no permanent skills shortage. That’s an impossibility despite the thousands of ‘chicken little, sky is falling’ articles by recruitment firms, HR consultants, etc.

At Abacus we are very active in the specialised area of part time under-graduate recruitment – it is a much better, lower risk way of hiring graduates. And a great low cost, productive resource for your team. We call them SMARTS.

Einstein says insanity is doing the same thing over and over expecting a different result. Given the HUGE failure rate in graduate recruitment, with each costing OVER a year’s salary when they walk out the door within 2 years, it is time to Think Different.

To learn more about SMARTS, visit our website: http://www.abacusrecruit.com.au/smarts.pdf

NEXT WEEK: Why Gen Y are no different in what they want from work but how do you get them to stay with you?!

Cheers, Toby

In February, an interview with Toby Marshall was published in Shortlist on the Talent Scarcity Myth. This is an industry magazine, and it drew a lot of Comments as for many in the industry, the belief in scarcity is like a mantra (not surprising given all the conferences and articles.)

For example, Julie Mills - CEO, RCSA (the Australian industry body representing agency recruiters):

“Claims by [Abacus] that the real issue is underemployment, not skills shortages, is not what the RCSA is finding in its activities with recruiters, job boards, candidates and clients.

In dealing with recruiters of all levels, every day, and around the country, the message I am getting is clear: finding employees with the right skills set is getting harder.

[Our latest Research] found that 91 per cent of agencies are devoting more time and resources to finding candidates than they did a year ago.”

Which of course, is my point: they are fighting the wrong war (see below).

Julie then goes on to quote the usual demographic shifts that have been talked about for 10 years or more.

Another good response was from Stephen Hinch, the Chief Marketing Officer at Manpower. It draws on the excellent and detailed research that Manpower has done in this field of long term demographic shifts.

As with Julie, the problem is the conclusions he reaches. That somehow market forces are not automatically brought into play to mitigate temporary skills shortages. In fact there are about 6 linked forces that stop shortages being anything other than short term (though they can last a bit longer in remote, relatively isolated places like Western Australia as John Kirkby rightly points out.)

The many excellent articles by Ross Gittens in the Sydney Morning Herald explain better than I can how these forces work. Basic economics. Any scarcity is temporary.

My original article essentially argues that long term shortages are impossible. It was also an attack on McKinsey’s ‘War for Talent’. Catchy phrase, made them a lot of money, but wrong. It is not a war for talent, it’s a war for resources to get the job done. Subtle, but an important difference.

There are plenty of resources to get the job done amongst the under-employed and elsewhere. Employers just need to think different. Some are.

Now, I didn’t write the original article on Shortlist, and it only touches on issues explored in my books and articles.

Abacus is arguing for a fundamental shift in approach by employers who want to think differently about scarcity. And stop constantly proving Einstein’s definition of insanity.

To stop taking their lead from recruiters, 90% of whom have the same business models:

Transaction focused; upfront commission driven; and responding to, not leading their clients.

So I agree with Julie Mills:- transaction recruiters and their clients are experiencing scarcity. They soldier on in McKinsey’s phoney war for talent.

Mobilising the 5 groups of under-employed is not just a nice thing to do. With labour markets, even a small percentage increase in supply has a BIG impact.

However, our interest is not with all employers: Only those who want to lead the pack with different strategies.

Most business people believe there is a talent crisis.

Why? Because every professional conference in Human Resources or Retention or Recruiting, starts with a version of:

• Talent is scarce because the population is aging
• You must spend big dollars on … whatever the conference is about … to either recruit (or retain) people

And because there are thousands of articles published every year – published by six powerful groups – to learn who, see a recent article in ShortList magazine:

http://www.abacusrecruit.com.au/abacus-in-the-media go to article 8

I hadn’t realised just how many articles and press releases were written on the subject until I talked to the editors of a couple of recruitment and HR magazines!

Now, to believe that talent is scarce and will get worse pre-supposes other beliefs:

1. About what talent is – with the ideal, and scarce, talent being aged 25 to 35, working full time

2. About the processes that are effective at finding talent

3. About how recruitment firms need to operate

4. And that the economic laws of Supply and Demand don’t work (yes, Dorothy, really!)

My argument is that all these beliefs can be rethought. None is set in stone and we will challenge each over the next few weeks.

One thing we learnt once we started the debate on The Skills Shortage Myth: that there are lots of surveys done of recruiters and CEOs, who all say that there is a scarcity. But this presupposes 2 facts: that talent is defined very narrowly; and that they use existing recruitment methodologies - but they don’t know of the alternatives. So, they answer as they see it from existing knowledge.

For now it is enough to begin the debate: That McKinsey’s War for Talent is a phoney war. The real war, in some ways a tougher war, is the ‘War to get the Resources to get the Job Done’. To see the first skirmishes in this war.

It is not just semantics. It is a different war requiring a different focus, different skills and a different mindset.

Over the next few weeks we will examine the first of the 4 beliefs underpinning the Myth: The absurdly tight definition of the talent being fought over. We will start by looking at one unutilised, large and extraordinarily talented group of people: The best and the youngest of Gen Y – undergraduate university students.