HRExaminer v3.13 March 30, 2012
Table of Contents
Employment Branding for Passive Candidates?
Long term readers will understand that I have little time for the idea of “passive candidates”. The theory goes that the best possible candidates are those who are not currently looking for a job. That’s neither clear nor usable.
I like what NetTemps says:
“While some think passive candidates include all qualified individuals who are not currently looking for a job, this is a wishful (almost delusional) way of looking at things. A passive candidate is someone who is not looking for a job, but would be open to taking one if the right opportunity came along. People who are happily employed and not open to taking a new job are not candidates for employment, passive or otherwise-and you will have to wait until they have a very bad day at work before you can consider them a legitimate prospect.”
Here’s the conventional wisdom about “passive candidates”.
- Passive candidates are defined as candidates who are satisfied with their current position and are accomplishing great things. (Association for Automatic Identification and Mobility)
- Passive candidates are not actively looking for a new position. They are satisfied in their current position. The best search firms are typically experts at engaging passive candidates in a 1:1 approach. (The Passive Candidate Mindset)
- You can’t recruit and hire passive candidates using the same workflow nor the same recruiters used for active candidates. (Lou Adler, ERE) (All of the ERE articles tagged Passive Candidate)
- A passive candidate is a candidate who is not actively applying to open requisitions and who is employed. (Lindsey Gurian)
- Passive candidates don’t need a ‘job’, they already have one. Passive candidates need to be offered opportunities which will allow them to change the trajectory of their career. This raises the bar and makes employer branding more important than ever before. (Welcome to the Talent Economy by Daniel Shapero) (all LinkedIn posts on Passive candidates)
- How to Be a Successful Passive Candidate: Constant Networking (Debra Feldman, the JobWhiz)
- Sadly, the vast majority of applicants do not possess the skills you are looking for. They’re not even close. You see, the truly qualified individuals are busy working in their fields of expertise and will never see your ad. We call those people “passive candidates.” (Miller-Abrahamson)
It’s simpler, really.
Experienced people who are already working in the industry don’t get jobs by sending out applications. The most important thing about ‘passive candidates’ isn’t that they are passive, it’s that they are qualified. When they want the next job, they network around the industry. When you want them to work for you before they’re ready to move, you network to them.
There are no new entrants to the market who are experienced. As obvious as that is, it gets left out of the conversation all the time. People who are new apply for jobs one way. People who are experienced do it differently. People who are really happy in their work don’t do it.
If I am new to the business, I need your website to tell me about your cultural values, the good works you do, the heroic journey of your CEO and the visionary view that drives your work. If I am experienced, I learn about you at trade shows and from the woman two cubicles over who used to work for you.
So, what is Employment Branding for seasoned professionals?
Well, it isn’t glossy and full of advertising-speak.
The employment branding task, when reaching out to experienced workers, is complicated territory that hasn’t been fully defined just yet. Here are some things to think about.
- Communicating the company’s reputation in a way that is consonant with the market’s view. This is harder if the company has a bad reputation or is going through a rough patch. Attempts to repair a bad reputation have to be gradual and part of a long range plan. On the other hand, if the company has a stellar marketplace persona, recruiting gets accelerated. It’s easier to recruit experienced workers to Facebook than HP right now.
- Understanding the company’s reputation requires constant market monitoring. Experienced people post reviews on Glassdoor. Inexperienced people read them. Experienced people don’t need to; they are plugged into the industry grapevine.
- The more an industry relies on contractors and consultants (say Entertainment, Publishing, Banking, Healthcare), the more these itinerant workers control the company’s reputation in the marketplace. Managing the contractors’ perception of the company is the last thing on most supervisors’ minds. They’re the first people that experienced folks talk to about what it’s like over there.
- Even if you have a crummy reputation, people will come to work for you if you offer them skills, money or big opportunities that they don’t currently have. Armed Forces are particularly good at this.
- The important things about a company’s reputation vary. Everyone knows that Great Big Consulting Company X is a sweatshop. The insiders also know that 10 years of working for them enables you to write your own ticket.
Experienced employees in your own company are the foundation of great employment branding in the industry. Figuring out how to collect and interpret their view of the firm is the first step. The Glassdoor data tells you what they are saying. That’s where you start.
9 Employment Branding Buckets
Employment Branding seems complicated because it is the complement (almost the opposite) of regular branding. Where the task of a unified brand development project is to get all of the choir members to sing from the same sheet music, an Employment Brand is directly targeted at the Labor Market. Where the top level brand is a universal story, the Employment Brand represents a series of overlapping realities.
If you listen to all of the brand soothsayers in social media, branding is a conversation between customers and aspects of the company. (For a clearer picture, read the ClueTrain Manifesto). Employment Branding is the most decentralized piece of a company’s brand evolution. It’s the place where small intimate conversations are most likely to happen.
Let’s survey the various approaches to Employer Branding.
- Employer brand was first used in the early 1990s to denote an organization’s reputation as an employer. Since then, it has become widely adopted by the global management community. Minchington (2005) defines employer brand as “the image of your organization as a ‘great place to work’”. Employer branding is creating this image. (Wikipedia)
- An employment brand is the way your organization’s prospective applicants, candidates, and employees perceive you as an employer. (Gallup)
- Billed as the solution for increased engagement, better cultural fit, reduced time to fill, and more, organizations have significant reason to build out their employment brand initiatives. (Maren Hogan in ERE) (All ERE Employment Branding Articles)
- Employment Branding applies the same branding principles of attracting and retaining customers to attracting and retaining top employees. Employment branding is built on research that supports employee retention strategies to enhance recruitment and retention in your company. Uncovering the strengths, weaknesses and hidden elements of your organization’s culture helps you better assess current candidates and create unique messaging to attract and retain talent. (Kenexa)
- We surveyed 2,250 corporate recruiters in the US to learn more about time to hire, cost per hire metrics and most importantly the impact of a strong employer brand. We have seen that companies that have strong employer brands enjoy significant cost savings with lower cost per hire and employee turnover rates. (Extremely weak LinkedIn survey)
- Employer branding owes much of its intellectual legitimacy to the practice of product and corporate branding. Talent executives have studied what their counterparts in Marketing and Communications have learned and adapted that body of knowledge to employment. (Mark Hornung of Hodes) (Quoted on Employment Branding Online)
- There are three distinct facets of an employment brand. Each of them are an aspect of the employment brand and not the whole thing. (HRExaminer, Employment Branding Elephant)
As you can see, the range of definition spans everything from the simple translation of branding theory into the employment segment to a more variable approach rooted in the job. Here are the three facets of the Employment Brand we unearthed in the Employment Branding Elephant article:
- Stories and positioning for people unfamiliar with the brand (Green)
- The way that experienced people within the industry see the company as a place to work
- The way that people inside the company see their employer (Internal)
It turns out that there are also three broad categories of employee function. What’s in each function varies by company. But, all companies have these three categories:
- Core: These are the people who create the central value that the company delivers. Typically, they are in engineering, operations, manufacturing, coding, content creation or some other central productive function. These people are what makes the company different from all other companies. Companies that specialize in an area tend to recruit the very best of these kinds of people
- Business: These are the ‘standard issue’ business people who administer the things that make the core possible. Finance, sales, customer service (unless it’s a core deliverable), marketing (sometimes), facilities, HR, security are all functions that are at least somewhat vanilla. Companies tend to acquire these sorts of people from the city in which the office is located.
- Digital: In the 21st Century, all companies have some level of social media and technology function that faces the market. Armed with 21st Century skills and a nomadic career track, this crew s interested in challenge. Companies compete broadly for this scarce resource.
9 box Employment Branding Matrix
Review: Wanted Analytics
What if you had a database of the 700 Million job postings that have been circulated since the mid 2000s? What if that was supplemented with Department of Labor data on the supply of people around the US? What if you were smart enough to correlate the two? What if you could extract compensation and benefits data from the subset of ads that carry it? What if you were an early leader in the solution of big data problems?
Well, for starters, you’d be Wanted Analytics.
Quietly, over the last couple of years, the East Coast company has established itself as a data powerhouse. While I’m most interested in the employment branding implications, Wanted Analytics uses its data for economic forecasting (they’re getting better and better), employment data for national and state governments, hiring friction analysis, compensation data and a range of sourcing strategies and tactics.
If you know who’s hiring, as evidenced by job ads, you can know a host of other things.
For instance, most companies believe that their labor market competition is the same as their commercial or consumer competition. Nothing could be further from the truth. Competition varies by job. The fact that this is so little understood explains much of the conundrum around employment branding.
Think back to yesterday’s 9 Employment Branding Buckets. There are three functional types of employees:
- Core: These people are the organization’s DNA. Their specialties drive products and innovation. One competes fro them wherever they are
- Business: These people make the organization operate (HR, Finance, Facilities, non-essential Engineering and Manufacturing). You hire them locally and compete in the local market for them.
- Digital: These people allow the organization to have a 21st Century look and feel. You are competing with Google, Amazon, Microsoft and anybody who is trying to prosper in the social technology age.
On a job by job basis, the Wanted Analytics data can be displayed to show where a particular job is being hired and who the day to day competitors are. With data in hand, in becomes particularly clear that the competition varies by job and location. If you act like your competition is Bank of America and it’s really Microsoft, you are going to have trouble recruiting. The Wanted Analytics tool allows you to see this and monitor it.
Wanted Analytics also collects and maintains a collection of labor supply statistics by job category. This makes it possible to see the difference between available supply and marketplace demand. In a sample analysis, we looked at Marketing Managers in the publishing and entertainment industries. In some cases, the demand was 50% greater than the supply if all of the people in the supply were available for work.
When you run into tight supply problems, Wanted has another tool.
By looking at and evaluating the history of hiring for a specific position in a specific locale, it’s possible to zero in on places where there are liable to be people who are the exact right fit. A job ad, two years later, is a perfect piece of intelligence.
By looking at the competition over time, comparing old job ads to your current requirements, searching for the person who got hired (on LinkedIn) and contacting them, a good bit of the uncertainty about fit can be eliminated up front.
The future of recruiting is vastly more data driven than it is today. The Wanted Analytics toolkit will be a critical piece of that future.
Please welcome Andrew Gadomski who joins the HRExaminer Editorial Advisory Board today. Andrew is the Chief Advisor and Founder of Aspen Advisors, an efficiency consultancy firm. Andrew started Aspen Advisors after a diverse and successful career in staffing and branding so that corporations that are socially and globally conscious can become great at acquiring talent and then advance their value propositions. Full Bio »
Why We Should Adopt the ANSI Cost Per Hire Standard Across HR
by Andrew Gadomski
Today, HR is a business function that needs to be able measure its performance and contribution to the company just like other key functions. Our talent teams need to develop competencies in analysis, metrics and reporting, executive presentation, and strategic initiatives. HR needs to understand and use the available data effectively. But what is that data, and how real is it?
The Society of Human Resource Management (SHRM) has designed a series of workforce groups that address the need to have standard metrics and measures. The goal is to allow companies to track themselves, and also compare their methods, results, and insights with other companies. In order to do that, the data has to be accurate and based on the same measurements.
Recently, SHRM’s Cost Per Hire standard was approved by the American National Standards Institute (ANSI).
I was part of SHRM workgroup that produced this standard. And I believe it is critical for companies to adopt the ANSI Cost Per Hire Standard. I admit advocating this standard, or any standard within talent acquisition, is daunting. Our industry is not known for all doing things one way. We pride ourselves in performing work in individual and customized ways. Yet, the Cost Per Hire Standard celebrates this flexibility, while allowing the industry the benefits of shared standards and practices.
The Cost Per Hire Standard consists of three metrics:
- Cost per Hire Comparable (CPHC). This metric contains a standard set of factors that allow companies to compare with one another. No more “we spend on this and they don’t.” Apples to apples.
- Cost Per Hire Internal (CPHI). This standard formula allows a company to assign certain costs for cost per hire for internal comparison. It can be as detailed as you need. This truly celebrates the flexibility of recruiting. For example, relocation costs are not included in the CPHC above, but can be included here.
- Recruiting Cost Ratio (RCR). This is how much you pay the people you hire. It’s important to run this metric because it will ground your organization as it competes for talent.
Also – don’t be afraid to run these in parallel or combine them. It’s an interesting analysis when you look at your CPHC (the external comparable), and then reference it to total compensation. Run both metrics for all your divisions or groups separately, and rank them in ascending order. You may find you pay more for some groups, and it takes less effort to find them, or vice versa. We believe that adopting the Cost Per Hire Standard will improve your insight into what your company spends to hire new people and will allow you to better compete for the employees you are trying to attract.
The Importance of Publishing Results
Using the standard is not enough. The success of its adoption also lies in companies openly sharing their results of the standard and its usage.
We also advocate that service providers, agencies, technology companies, and outsource providers adopt this standard and publish their results too. Until everyone is using the same metrics and there is no way to truly evaluate whether the technologies available really improve the hiring process or they are just measuring differently.
SHRM will be reaching out to technology and outsourced providers throughout the United States, and will be imploring them to advocate and adopt the ANSI Cost Per Hire standard. We will be asking corporate recruiting organizations to place pressure on their vendors to also adopt the standard. Your support in both regards is appreciated.
On a personal note, I find this is long overdue. This standard, and the upcoming ones, will establish HR metrics that make sense across industries and give HR, company leaders, and vendors, the information they need to see what is working and what should be changed. This is exactly the data HR needs to do its job– as the strategic business function that it is.
At the heart of good recruiting, retention based on personal desire, great customer relationships, solid team work, clear delivery of results and, increasingly, any business success, is the mastery of relationship management. Relationships are hard to develop in volume and many people take statistical shortcuts in processes that develop relationships based on the luck of the draw. The reason that Direct Marketing techniques generally have a bad name is that they tend to treat people like objects as a precursor to a deeper form of relationship.
The message in this approach is “if I can figure out what value you bring to me, I will invest in a deeper relationship.”
No good relationship begins with the proposition that it will depend on my understanding of the value I’ll get.
They begin with the question “What value can I give?” They start with the notion that the “objects of our desire” are people first. When they are “objects” first, the very beginning of the relationship is sowed with the seeds of its ultimate failure.
In situations that require people to sift through volumes of potential relationships, the tendency to objectify feels like a quick shortcut to successful completion of the task. Reviewing hundreds of resumes to arrive at a “shortlist” of ten which will then be sifted to an interview pool of three or four is a task that demands sensitivity to data and the nuances of personal PR. Remembering that each resume represents the desires, hopes and aspirations (and sometimes desperation) of a person is a nearly superhuman task that requires the constant availability of forgiveness, a sense of humor and a willingness to see beyond the data. It is tremendously hard to keep this perspective fresh and foremost, particularly in a reactive environment.
Rather than focusing on being “x-kind of Relationship Manager” most ATS systems (or CRM systems for that matter) might be better called Potential Relationship Databases. Like the personals section of the local newspaper, they give a lonely recruiter or salesperson the opportunity to initiate a relationship. It is the process of evolving and maturing relationships, however, that characterizes real sales or recruiting effectiveness. It’s a process that can be supported but never automated because it involves the feelings of the person doing the recruiting or selling.
While there are tons of sales training programs that do it, we’ve looked and looked for either a managerial training program or a recruiter’s training program that focuses on a simple truth: Your effectiveness depends on how you feel about yourself and others. All of the sourcing and record keeping programs in the world won’t begin to compensate for a recruiting process that treats potential candidates as objects. To the extent that current systems perpetuate the myth that data constitutes a relationship, they are major contributors to the problem.