Who takes the risk in recruitment?

The answer: Everybody!

The employer takes a risk as the new employee may not fit into the organisation, may not have the claimed skills, may simply be the wrong person; the candidate (new employee) takes a risk as the new job may not be what was described , may not provide the opportunity required and may simply be the wrong job; the recruiter tales a risk as the client may change the rules part way through the assignment, may fail to adequately describe the requirement, may not pay within terms (or at all), and candidates who appear very good at recruiter interview frequently fail to perform well at employer interview. In all of the above, at least one person takes a hit in either cost, time or lost opportunity.

If everybody is taking a risk, there should be a solution which will at worst minimise the risk to all, and, in a sense, this falls down to two things : a realistic business arrangement between client and recruiter and trust.

An effective and valid working relationship between client and recruiter is vital as the recruiter should really lead and determine the structure and process of the assignment. That statement will doubtless cause a few raised eyebrows but, think of it this way, the recruiter must have an understanding of the client requirements and, equally, must understand the candidates; further, the recruiter has to ‘sell’ the candidate to the company and the company to the candidate. Thus, the recruiter is focal and should establish the requirements, timeline, and the schedule for each party in the process – in other words, act as a project manager. Payment on a contingency basis (i.e. fee paid on success) is not valid at this level of involvement and, thus, the recruiter’s fees should be based on a fixed price, an hourly rate, or a retainer. The effect of this is to establish, from both points of view, the importance of the relationship between client and recruiter. One could argue- probably undeniably - that a relationship of this nature removes any risk from the recruiter and places additional risk on the client but relationships are built on trust and that trust has to be established . There is no reason why fee withholding, partial payments, or even the application of penalty clauses should not be written into a contract. However, if a recruiter is paid on a verifiable hourly basis the risk to the employer is limited.

With this business relationship established, the recruiter is in a position to determine the requirements for the role and is sufficiently placed to be able to ask (and receive answers to) more probing and difficult questions, all of which contribute to accurate requirements being established. Part of the project should be for the recruiter to write the job description (role requirements) and to achieve sign-off on this. This job description should include skill, experience and personality requirements but should also define the salary and benefits parameters plus any information which will enable the role and the company to be better presented to candidates. There is, in this writer’s mind, anyway, already a significant shift to head-hunting and direct search from the accepted ‘traditional’ route (i.e. advertising a role) of finding candidates and this will be increasingly emphasised once this recession ends . Thus, the importance of being able to present effectively, completely and truthfully to candidates will become even more important than it is at present.

The recruiter should establish milestones and who does what, when and to whom. The employer has to understand and commit to certain actions and, likewise, the candidate has to make an equal commitment. Basically, if a candidate is selected for presentation to the client and cannot commit to certain actions then that candidate has to be discounted.

There is a final risk and this one falls fairly and squarely on the employer and that is that the selected candidate, despite meeting all the specified criteria, is not the ‘right’ candidate. He/She may be correct but may not be the right choice. Sometimes, an oblong peg may bring more to a company than a square peg. In twenty-five years of recruiting staff for companies he worked for at director level, the writer always chose candidates who were not an exact fit for the job but those who could bring something additional to the role. None of these proved to be bad choices and some could be regarded as mavericks but all added significantly to the company they joined. A skill of the recruiter is spotting these people – a skill of the employer is being able to recognise something special when it is presented to them.

Unemployment Highest since 1995

Very interesting article by Mike Jones on the 'Recruitment Today' website. (http://tinyurl.com/rcyc5a) showing that unemployment is the highest since 1995, that 220,000 jobs were lost in the three months to June and that the situation will get considerably worse - all of this based on either official statistics or the opinion of experts.



These figures, however, are understating the true situation as several groups are excluded or, if you prefer, not included: any unemployed person on long-term sickness is unlikely to be included in these figures as is any self-employed person who has lost their business or whose business has simply dried up. These people either can't or won't draw job seekers allowance and so are not included in the figures. Conservatively, one can probably add at least 500,000 to the official figures.

Recent reports have shown France and Germany back into growth with Japan a very recent addition to this select group. Talking to a colleague who has just returned from an extended round the world trip it appears that China and India never went into recession, they just became concerned when growth dropped into single figures. There are signs of recovery in the US but it is still officially in recession. So, what about the UK? Some optimists predict that we will enter growth by the end of this year or, at latest, in the first quarter 2010; pessimists add a year to this.

But, where is this growth coming from and why, therefore, is it still predicted that unemployment will grow? The reason - at least to this simple observer - is that there is no prospect of growth in any area that will generate significant jobs. And, if the UK's economy does start to grow, each man, woman and child is saddled by massive debt, and the government in power will have no option other than to increase taxes (direct and indirect) with a simultaneous cut in public expenditure and neither of these is likely to engender growth and, hence, employment.

Returnng to the question of growth and, perhaps, more importantly the creation of genuine wealth, what will cause the growth and increase in wealth? The answer, very simply, is that it is necessary to sell something to a customer in another country at a level which enables a profit to be generated.

Here is a little story which on the face of its shows how the economy works but when you think about i.....:

"It is the month of April, on the shores of the Black Sea. It is raining,and the little town looks totally deserted. It is tough times, everybody is in debt, and everybody lives on credit. Suddenly, a rich tourist comes to town.He enters the only hotel, lays a 100 Euro note on the reception counter,and goes to inspect the rooms upstairs in order to pick one.

The hotel proprietor takes the 100 Euro note and runs to pay his debt tothe butcher.

The Butcher takes the 100 Euro note, and runs to pay his debt to the pig grower.

The pig grower takes the 100 Euro note, and runs to pay his debt to thesupplier of his feed and fuel.

The supplier of feed and fuel takes the 100 Euro note and runs to payhis debt to the town's prostitute that in these hard times, gave her "services" on credit.

The hooker runs to the hotel, and pays off her debt with the 100 Euro note to the hotel proprietor to pay for the rooms that she rented when she brought her clients there.

The hotel proprietor then lays the 100 Euro note back on the counter.

At that moment, the rich tourist comes down after inspecting the rooms, and takes his 100 Euro note, after saying that he did not like any of the rooms, and leaves town.

No one earned anything. However, the whole town is now without debt, and looks to the future with a lot of optimism.

And that, ladies and gentlemen, is how the UK Government is doing business today."

Of course, the poor hotel proprietor is down by 1oo Euros in terms of cash but he effectively borrowed the money to pay his debts. There are no more Euros in the system but the overall (apparent) wealth has been increased by 100 Euros.

The only way to generate real wealth on a national basis is to export and to export you have to either make something or provide a service. Thus, investment has to be channeled into the regeneration of manufacture or the generation of service offerings attractive to the rest of the world. Services are unlikely to generate a significant requirement for employment, whereas manufacturing will. Building a manufacturing base - especially for products that the rest of the world will want to buy - takes time, education, training, resource and this, perhaps, is where the government should be spending our money.

Staying Put!

A recent YouGov survey has shown that the vast majority (75%) of employees have no intention of moving jobs during the current recession, even though about a third would move given the opportunity. Perhaps more interesting is that a significant proportion (25%) want to move to different sectors or completely change their career direction.

Not so lucky are those aged 50+ as another report shows that the proportion of 50+ being made redundant (as a proportion of the total volume of redundancies) has increased to over 60% from just over 30%. Is this ageist or just unlucky?

When the Recession ends!

According to a report by The Boston Consulting Group (BCG) and the European Association of People Management (EAPM) just 15% of European companies plan their workforce more than three years in advance - suggesting that many companies may soon face key shortages in skills.

This will be caused by the "double whammy" of falling birth rates and rising numbers of baby boomers entering retirement shrinking the size of the work force.

The report also found that 47% of European companies did not plan their work force requirements more than a year in advance. Companies that have been forced to cut costs and reduce head count during the Recession may struggle to find the people they need when growth eventually returns. Companies therefore need to consider the long-term impact of their actions, even-or especially-in times of crisis.

"In ten years, the scarcest resource for a company will be people," said Rainer Strack, a co-author of the report and senior partner in BCG's Düsseldorf office.

"Companies should understand how their workforce will develop, which job categories drive the business, and how demand will evolve.

With the uncertainty prevailing today, the human resources (HR) department should analyse different scenarios to figure out whether and how to find, hire, retrain, outsource, or lay off employees.

Very many companies were hit hard by the recession and had no option other than to shed staff. One could look at this as an opportunity as many companies will now be as lean as they have ever been and this provides an ideal platform from which to develop.

Staff planning should be a fundemental asect of a business plan, but it rarely is. Any kind of evolution results in change and if this is not planned the result is panic.

One result of the recession and the growth in the available, skilled workforce is that companies have an opportunity to 'try before you buy'. Very many people who would previously have not given consideration to interim or temp-to-perm type arrangements now will and this presents an ideal opportunity for companies to grow their staff at reduced cost and commitment.

The use of 'interims' or a temp-to-perm type arrangement should, of course, form part of the company's long-term strategic planning and, with the exception of a specific and defined interim assignment, a person taken on uder either of these arrangements should be viewed as an eventual permanent employee and, thus, normal recruitment processes should be applied.

Woolfram Alpha

I am really interested in seeing this product and how it works, especially in its use of Natural Language. Years ago I was heavily involved in the introduction of what was, at the time, the most advanced, by far, Natural Language processor. The development was carried out in Berkley by two individuals whose conceptual understanding and sheer technical capability was way beyond anyone that I had met before or have met since.

Most so called Natural Language Processors of the time were keyword driven and could only function with a limited set related to those keywords; our product utilised both semantic and syntactic processes (via a very clever parser) and could handle a vast lexicon related to the subject matter contained within one or several databases.

I remember accompanying one of the founders to a meeting with the developers of the leading European project and we found that this product could handle about 10,000 words and really did not have a grammer- ours would have no problem in handling well over 100,000 and had a very powerful grammer.

The difference was that Natural Language (the product name) was not actually interested in words, but in the meaning that a group of words contained. Thus, it was possible to ask the same question in several different ways and get the same answer. It built a context, so from that point it was possible to expand or refine, i.e. broaden the context or refine it to pinpoint a particular thing.

It was (and probably still is but in a different form) an incredible product and one in which I am delighted and proud to have had an involvement. Like all things, however, it had its problems - a few technical and a few operational - but the major issue was getting organisations to understand its power and capability. It is always the same when a revolutionery new product/facility is brought to market: nobody understands and it is rarely the innovator that gains the reward for the innovation but somebody that comes along later.

GBCSRECRUIT21

An unashamed plug for our new and refreshing approach to recruitment. Have a look at http://tinyurl.com/bpxo4z as our approach will save you time, disruption and money.

Career Engineering (2)

In a previous post I talked about Career Engineering as a topic but now this is something that we are offering as a standard group of services. Our website http://www.gbcsrecruitment.com has full details on the Services page. The idea is to provide jobseekers with the opportunity to enhance the way they present themselves to employers.

It was really sad to hear on the BBC Breakfast News this morning a report on a person who had been an Operations Manager, was made redundant over a year ago and has since applied for 300 jobs without gaining an interview. That is terrible! Not just that he has been out of work for that long but because there has to be something wrong with the way he is presenting himself to employers and that nobody seems to have helped him.

As a recruitment company, it is against the law to make a charge for improving the CV of a person that wants to register with you or applies through you for a job. But you would have thought that someone would have given him a hand or he would have been able to access all the free information that is available.

As I don't know anything about the guy I can't comment on his skills, qualifications, experience, but I doubt that he would have got to a senior position without some level of ability and so there has to be something wrong with his CV, presentation skills (actually, he hasn't got that far) or he is simply applying for the wrong jobs. Like two million others he is in a desperately sad situation.