HRExaminer v3.19 May 11, 2012
Table of Contents
Like a Beatles Renaissance, the War For Talent is Back (for Real)
Bruce Steinberg is the labor economist who is most focused on staffing issues. If you’re not subscribed to his monthly newsletter about the Employment Situation, now’s the time to sign up. Bruce’s crisp analysis helps see the national underpinnings of the recruiting problems you face.
It’s not that knowing what’s causing the problem makes it any easier to solve. It’s that knowing that the problem is real allows you to adjust your tactics.
Take this month’s newsletter.
It features a graph that compares job postings (vacancies) and the unemployment rate. For the past decade, the two have had an inverse relationship. (When the unemployment rate falls, vacancies increase and vice versa).
That appears to have stopped.
(For a full sized image, click here)
Notice how the inverse relationship was maintained until the recession. Coming out, vacancies are now at pre-recession levels. Yet, the unemployment rate stays high.
It’s worth underlining that last bit. The number of job openings is now at pre-recession levels. Historically, the unemployment rate would be at pre-recession levels as well.
This is why talk of a “War For Talent” has begun again.
One explanation for the chart is that the people who are unemployed do not have the skills required to fill the positions available. The jobs that are being created (social media pros, data analysts, bio technicians, health care in general) are for people who have other than the skills available.
Yesterday, I went to an amazing conference in San Francisco. It was by and for Recruiters in Silicon Valley. Times are tough for Recruiters in the Valley. The jobs available don’t match up to the skills in the market.
It’s happening in lots of other parts of the country.
The competition for scarce workers is coming to a head, again.
by Hank Stringer
We have an abundance of positions to fill around the country that require specific skills. We have a very high unemployment rate and an abundance of people without the right skills. What do we do? How do we align this mismatch to execute and accomplish business and personal life goals? There is an answer in the way we interview and hire.
I recently had the opportunity to spend time with an old friend. This friend had been a business compatriot of mine in the early DAZE of the Internet boom. I had the opportunity to watch him work as a technology leader, and a workhorse of the first degree. He, like many of you, wore the phrase “whatever it takes” on his chest as a true badge of honor. He made things happen. He got things done.
My friend went on to technology heights in the startup and enterprise software markets becoming an executive leader for the largest software companies in the world. Because of schedules and world travel, we had not sat down to break bread for years. So a recent 2 ½ hour lunch to just talk was such a blessing for me, and I hope, for him.
Good recruiters have a capacity for and a deep joy in asking questions and listening. I asked my friend a number of questions surrounding talent issues. I really got to the meat of his talent experiences when I asked what was his biggest talent obstacle he was most proud of solving. He didn’t miss a beat. He immediately began describing how he sourced and hired Product Management talent.
Good product managers are not easy to come by. They have a tough job straddling the fence between technology scope, client requirements, investment / budget control, technology upkeep, and of course, market competition. Finding talent who knows a specific technology market, has successfully helped bring product to market from soup to nuts can be a very tough and expensive process. And getting any product to market on time and at, or under, budget is very important. The Product Manager is just one cog in the wheel but an essential one.
My friend’s experience at successfully hiring Product Managers could be a gem. I sat back ready for a long description of process and unique sourcing techniques. Then he stunned me.
Please know that he was describing a time when he was managing over 3000 technologists and carried a P&L in the billions. This was no small area of responsibility. Whatever his program, he had to get it right pretty much the first time – not a lot of flexibility here. He needed Product Management talent. So what stunned me?
He answered, “I hired a store manager from Nordstrom’s,”
I almost screamed. “What? You can’t be serious!”
He said, “Sure. They have a lot of responsibility. They understand reporting, management, and like to be held accountable for doing a very important job. And they are more affordable than the few good product managers in the software space. It takes less investment. And I get results faster if I hire good talent and bring them up to speed myself.”
I know there are plenty of you reading this and thinking, “Sure, no big deal. I do the same thing.” But I also know there are plenty reading who are thinking, “There is no way my management or HR function would let me do that – but boy I wish they would!”
My friend hired good talent, knew where they were deficient, discussed this with the person during the hiring process, and brought them on board with a plan and expectation to get them up to speed and adding value. Even if a few of the talent hired did not work out, the majority did and it was a win-win for all involved. Makes sense, right?
The discussion reminded me of a project I took on long ago at Dell Computer. Michael and the executive sales team needed to hire 15 top Account Executives around the country in 60 days, start to finish. Now this was the early 90’s, and Dell was known, but not that well known. Believe it or not, the direct sales model was in the early stages–direct sales was a new and incredible common sense approach to the market. In order to accomplish the goal of 15 top AE’s in 60 days, it was necessary for me to set the ground rules. Luckily, Susan Larson, the Sr VP of Sales at the time, supported me and gave me all the rope I needed to be successful or hang myself.
Hiring to Deficiency
I came up with a program I called “Hiring to Deficiency.”
Here are the key points of that old program.
Created hiring teams of three for each region
Had a specific time line for each step of the process
Met with all interviewers with Susan standing by my side telling her team to do “whatever I said – period”
Trained all interviewers in behavioral interviewing
Forced them to interview in panels of three
Gave them three candidates for each region
I sat in every interview
Trained them to hire to deficiency – hire the talent closest to the needed skill set
Told them they were accountable for discussing these areas with each talent before hiring
And that the panel of three was responsible for getting the talent up to speed
There was more to the program but by working these main points we successfully completed the project. Because we had a program and plan to work with the talent to get them up to speed, we attracted and hired some of the top Account Executives who have worked for Dell. (By the way, I don’t imagine any of them are working now as they made millions of dollars through sales payouts and stock options.)
The program, managed properly with the right expectations, works.
A New Idea?
Absolutely not. However, the process of seeking and executing a solution may be new, as we approach solution seeking differently. In the past, we dealt with real world real relationship scenarios. We did not immediately consider searching the web, using job boards to build talent flow, or relying on private company web pages or social networks to attract talent. These are all worthwhile endeavors.
But reviewing successful talent programs from the past is worth remembering, and maybe worth pursuing – again.
For instance, in the early days of IBM’s involvement in computers, programmers en masse didn’t exist. And there was no Internet to source, test and train prospective talent. What did IBM do? Well IBM considered the skills they needed, talent who could easily understand something akin to a binary language, who were creative and could sit at a keyboard for long periods of time.
Guess what? Music majors who had been trained in composition (especially trained pianists) fit the bill. The program worked! Is there a community of Liberal Arts majors ready to do technical work instead of service industry positions today? Is your company willing to find out? How can we assess and train them? Today we have the Internet, and I am sure a number of companies have programs like this in place. Why not all, or at least more?
In the 1980’s Ross Perot, Founder of EDS needed top notch sales account managers. And he didn’t have time to waste weeding out those who could execute successfulagainst those who couldn’t. So he implemented a tough front end filter (today that would be a blue suit, red tie and no tatts), and created an intense 3 year training program that he valued at $9K. If you were chosen for the training program and failed at any point during the three years, you had to pay the prorated portion of the $9K back to EDS. Not sure that would work today, but with an army of well trained enterprise consultative sales account executives, Ross was able to build a multi Billion dollar company.
Training programs for the masses appear to be long gone. But access to assessment and training for individuals, in areas vital to make them productive, is easily accomplished on the web. Just do a Google search and get started.
Why is it important today?
We have an abundance of positions to fill around the country that require specific skills. We have a very high unemployment rate and abundance of people without the right skills. What do we do? How do we align this mismatch to execute and accomplish business and personal life goals?
If we spend time and dollars working and waiting until we hire the perfect talent, we lose. We may rely on corporate training programs, but can we really? If we need talent today, we must move quickly – there is simply no time to lose!
So instead of training in groups, why not hire great talent with high Emotional Quotient, with interesting experiences and desires, who understand and appreciate a company spending the time and effort to take them to the next level?
There are all types of positions that need to be filled and all types of people willing to work. If we consider the base attributes we seek, and work to train talent in the areas they need help, we get great talent faster.
One more thing. Do something great for someone, and they may be more loyal next time the recruiter calls attempting to take your best talent. Work to advance their knowledge base and career, and there is a better chance they will stick with you through thick and thin.
The value of attracting and training great talent really pays off as you retain them. Be open, honest, and give people skills to advance their career, and retention will increase. Be prepared however, to continue paying for that value equal to the market. Or else some company will figure out the economics, and will recruit and pay more, a lot more.
This cycle and scenario has happened before and will happen again. At this time, in this talent market, it makes sense to revisit hiring great talent with a clear understanding and program in place to overcome their deficiencies. What else are you going to do?
To: All Employees
From: Marc Effron, CEO
Re: Competency Model departure
It is with mixed emotions that I announce that Competency Model will be leaving our company after more than 30 years of service. CM, as he was affectionately known, originally joined us as a bright new idea and quickly made an impact on our organization. He helped to bring order out of chaos and served as a shining example of the types of behaviors and capabilities that we should all embrace.
Not a corporate native, CM was born in Academia and raised in Consultancy, so he was slightly difficult to understand at times. He used words that didn’t quite sound like our company and, well, was rather verbose. That being said, those who were able to invest significant amounts of time with CM often found some value in the interactions.
Everything that CM did was with the best intentions. His efforts to become highly involved with our hiring and promotion processes didn’t work quite as intended, but he certainly gets credit for giving it the old college try! CM left a lasting impression on our company and will be remembered for his effective, err no, helpful, or should I say business focused, I mean CM could really . . .
Ah hell, you know I never liked that little bastard anyway. I mean what exactly was he trying to do around here all those years? We all know it takes a while to settle in. But if no one likes you after all that time, then doesn’t that say something? It’s not like we’re closed to new ideas. We weren’t sure about Engagement Survey when she first joined but now we can’t wait to see her! And Talent Review! Who among you didn’t think Talent Review would be a total bureaucratic nightmare? But now we’re all big fans and are happy to spend time with Talent Review!
I think the real problem with CM is that he just never fit it. He never sounded quite like us. We spoke about business results; he could only focus on bite-sized behaviors and capabilities. And he always sounded a bit academic. Remember when he said we weren’t precise enough in describing what it meant to “win” here? We knew exactly what we meant, but he kept trying to slot it into 68 categories. “That sounds like being Results Driven and Creating Strong Followers!” Sorry Doc, it actually sounds like exactly what we said – winning here means building a team that can destroy the competition.
Not to pile it on, but a little focus wouldn’t have killed CM either. Yes, we understand there are twelve important behaviors that make a good leader. Couldn’t he have told us which three to really pay attention to this year? And the twenty things he’d list under each of his points to “help” us better understand him. Really?
We will not be filling CM’s position. Instead the senior team and I have identified the four outcomes that define a successful leader and we’ll hold everyone accountable for those at bonus time. We’ll have our recruiters ask candidates to discuss how they’ve delivered similar outcomes. When we put people in new jobs we’ll make sure they can deliver those outcomes too. If you have questions about how to apply these outcome in your job, ask three people for suggestions.
This seems so easy – I feel better already! I’m not sure why CM needed to make everything complex when a simple solution was so obvious. Speaking of which, I’ll be sending another note shortly about some impending departures in our Compensation group.
Rather than making things better, it’s fairly common for venbdors to use a FUD (Fear, Uncertainty and Doubt) strategy rather than actually developing something. By screwing around with semantics and turning intelligent conversation into a debate about the meanings of words, they derail innovation and disruption. To find the the sources of confusion in the business, all you have to do is follow the money.
So, on the subject of Talent Communities, it’s better to point to public examples. Here are the stories you ought to be watching”
- 85 Broads
This global Women’s network has more than 25,000 relatively high powered members. Founded in 1997, the operation predates much of the social media fanfare. That makes it an extraordinary example of what a formally developed network can be designed to do. 85Broads should be considered a model for the many small scale networks that are likely to take root over the coming years.
Positioned as a career gateway for ambitious young workers, BrazenCareerist offers a combination of advice, resume hosting, networking support, and job ads. It’s more personal than a job board and less social network-y than Facebook. It’s probably a great place to encounter young people who read Fast Company. It’s a fantastic example of how job boards could start to evolve.
Doostang is “an exclusive career community that helps elite young professionals accelerate their careers.” Founded as a career accelerator for graduates from top colleges, the site is evolving into a network for finance jobs. The site claims to have 750,000 members and 1 in 4 of the graduates from the top 30 colleges. Members pay about $300/year for a subscription to the flow of jobs. Doostang uses referrals from networks that are larger than a typical Facebook model.
The oldest of the professional networks predates the commercialization of the Internet. Launched in 1991, the company teaches networking and job hunting skills to its network. The niche is executives making over $150K (US)
This offering from DataFrenzy (a Recruitment Technology provider) is best understood as a demo project. The parent company makes a variety of tools that are white labeled by other vendors in the space. Technically, it’s an interesting blend of functionality from old school career sites and contemporary social media. It has some potential as a hosted career network for individual large companies. Gadball does not build on the Facebook ecosystem
Another software engineering oriented community, Github allows developers the opportunity to show their stuff in front of peers
With nearly 500 organizations onboard as customers, KODA was a meaningful pioneer in using social networking as a way to build a career. The site simultaneously provided interesting alternatives for personal portfolio construction (with video and multimedia) while offering users the technical potential to network. Even with employers and jobs, the operation folded in on itself as the result of poor candidate acquisition. KODA closed in May 2011 after two and a half years of operation. The story represents a cautionary tale for employers who are considering investing in new services.
Another property that predates the dot com explosion, MediaBistro is a perfect example of how to build a social network that serves a professional niche. Rooted in physical events, classrooms, local networking and professional development, MB focuses exclusively on people in the publishing industry. The operation has patiently grown from a team of three in 1999 to a significant enterprise with lots influence in 2011. Rather than a series of nonphysical connections driven by short messaging, MB meets the needs of the whole person in the network.
This Manhattan based talent community is one of the few players in social media to clearly demonstrate an understanding of the local nature of Recruiting and community. Think of OneWire as a LinkedIn for the New York financial community.
As of late 2011, this small career network based on the Facebook platform has received about 10,000 likes on Facebook. While there is a technology framework, the initial question for a network is whether it can acquire users rapidly and distinguish itself from the host environment. That task either requires deep pockets or incredibly viral adoption. Neither is obvious in the current offering and coverage.
Slashdot is a technology-related news website. Billed as “News for Nerds. Stuff that Matters,” it features user-submitted and evaluated news stories about science- and technology-related topics. The Slashdot has been around long enough to show the real signs of online community: internal slang, competition amongst residents, group shunning, and assistance in times of need.
This another way of saying that talent communities are alive and well. If you want a clearer picture of what one is, take a look at these examples. If you know of communities I’ve missed, let me know.