Seven Techniques to Winning The War on Talent
I am impressed by the number of companies that are experiencing revenue records. And, surprised that in a large majority of cases, business should have been much stronger. Almost all of our clients have had to walk away from business or defer revenue. The primary reason has been related to people. While supply chain challenges have been a significant factor for some, two-thirds of the issue revolves around people. The number one challenge has been having had the wrong people or finding enough of the right people.
While many leaders have pity parties, others have taken a different approach. The truth is that your people’s issues are internally rather than externally driven. Yes, there are more job openings than people actively looking. Yes, many of the people who are applying are less than ideal. However, when was the last time you did not have this same problem! While many companies struggle to fill a few positions, others add hundreds of employees per month.
One client I work with had about 60 Employees in December and is now approaching 200 employees seven months later. They are on track to hire over 50 employees this quarter. They accomplished this while many other companies in their same industry are experiencing difficulty recruiting far fewer employees. There is a clear difference in how my client has approached winning the war on talent. They chose to follow the steps of other companies that were having success and not falling into the trap of listening to others that were not.
If hiring the right people is negatively affecting your business, I recommend you keep reading…
Before I get deep into how, I want to clarify that you probably need to raise rather than lower your standards. I am finding that a primary reason for your company is that you have been building a team with misfits, half-fits, people that lack hunger, and others that may be productive and a nightmare for everyone else to work with. This significantly deters the right people from applying or accepting your offers. Remember the saying, “birds of a feather flock together.” Be careful not to build the wrong flock.
When you accept lower standards, you create significant issues. And while you may try to persuade me that it is better to hire poor talent than none at all, I will respectfully disagree. Hiring success requires that you hire someone who consistently demonstrates all your core values and produces reasonably high productivity standards over one year. Those standards typically rise over the year. Anything less is a miss-hire. When you miss-hire, here are examples of the cost:
- Let’s assume that lower hiring standards cause hiring success to be 25% (the national average). To correctly fill ten positions, it will take 31 hires before you have to fill them with the right people. Consider how much extra burden (recruiting, productivity, management time, training, and so on) it places on your organization.
- Wrong people suck the life out of your best people. They infect the right people.
- Wrong people cause lost business.
- Wrong people damage your company’s reputation.
- Wrong people cause right people to quit or not join your company.
I am sure you are reading this and thinking, “theoretically, you can’t disagree, but what do you do when you need people, and the right ones are not presenting themselves. I have identified seven techniques companies are using right now to win the war on talent.
Allocate Proper Resources
If I looked at how much organizational time and resources go into finding more of the right people, I will bet that you would receive a failing grade. You should be willing to work as hard (if not harder) to find people as you do to get customers, service customers, and create products and services. With the right people, it becomes easier to get and keep a customer. Product quality and service levels go up. To be a top-performing company, you must build a talent acquisition model that is the standard for your industry.
In every case where a company has a recruiting problem, I find a resource problem. For every eight people to be hired in a month, you need at least one full-time professional recruiter. Recruiting is not placing advertising on job sites. That is marketing, not recruiting. Recruiting is reaching to and communicating with candidates. Recruiting is a specialty role that requires the right type of person, knowledge, and skills. Just because someone works in Human Resources (HR) and has a professional designation does not make them a recruiter. Many HR people hate recruiting, suck at recruiting, and want to be doing something else. If you need a recruiter, hire a recruiter. Another common issue is delegating recruiting to administrative staff. This is the equivalent of putting a rookie in a position that requires a veteran. This is a war and you need the right weapons and strategies to win it.
The client I mentioned above has six full-time recruiters who all make six figures. What do your recruiters make? My client’s minimum standard for recruiter productivity is 100 applicants per filled position and two people hired per week. Essentially 1 in 100 candidates is employed by my client. They make every candidate complete three assessments, undergo several rigorous interviews, and have some of the highest standards of all companies I have ever worked with.
Every person in your company should be engaged in recruiting! When you are proud of your company, why wouldn’t you? Asking people for referrals and engaging them in a process is different. Engaged means it is important to them. Ask an overworked person how you can help, and they will tell you to hire more people. Yet, they know and interact with lots of people all the time. “And birds of a feather flock together.” They need to be part of the solution. If you want more people like you have, teach them how to help fill the company with great people.
Do you have a process to engage employees? Have you provided them with the knowledge, tools, and resources to help bring in candidates? Do you have a financial incentive that is worth their time? Does everyone know what positions you are trying to fill? Do they know what to look for? Have you made the process easy for them to help? If not, you are missing huge opportunities. The right approach leads to better candidates, more candidates, and often your best employees. If you are not receiving a significant number of candidate referrals from employees, they either hate working there, or you have a bad process.
Segment the Market
Similar to identifying customer segments, you need to identify employee recruitment segments. Everyone is not an ideal candidate for your position. One of our clients hires a lot of salespeople. They figured out that many of their best employees came from the car industry. These employees were well trained, well-screened, and could make far more than if they sold cars. As a result, most of their recruitment efforts target people who work for or worked for car dealerships.
Another client needs people in construction-related work and realizes that they have high success with former military people. So all of their efforts for certain positions are focused on getting access to people that are in the process of transition from military to civilian life.
Reduce No Shows
A problem that has always existed is people who applied for positions and never showed up for their interviews. With government stimulus packages to help unemployed workers, it seems to have exasperated this issue. Whether or not that is true, you need a process that discourages these people from wasting your time. We have found that requiring applicants to complete assessments before they are considered for positions weeds out the not serious people. That, combined with a quick phone screen, can help you minimize the effects of no-shows.
Increase Process Speed
Another common I see, which often is the consequence of the resource issue I mentioned above. Does it take too long to complete your hiring process? How long from when someone submits a resume to when they can get to “yes” or “no.” If it takes more than four weeks to complete your cycle from resume to offer made, you are going to lose great candidates. The lower the level, the faster your process should be. If it is a front-line position, set your goal to a two-week cycle time. They have lots of options, this is where the biggest shortages are, and the early bird gets the worm. The longer it takes to complete the process, the less interested someone will be to work for you. Customers require speed and employees are your most important customer.
For any of you that have read my book, Your Business is a Leaky Bucket, you will not be surprised to find this suggestion. There are many case studies where companies paid far higher compensation than their competition and had higher net profit statistics. This happens when you are more proficient in hiring the right people. Great people do three times the work of the average worker. Finding the best people and compensating them leads to more ideal candidates and higher retention. Don’t look at compensation, monitor return on the payroll. The later is where the secret to success lies.
If you are one of those people that believe that people have to work in your office to be productive, you are missing a great opportunity. While I know you likely have positions that require people to be in your office, there are many situations where that is not true. By being willing to allow people to work anywhere, you increase your pool of potential candidates. When we were hiring an executive assistant, we picked markets where we thought more high-quality candidates would be. This not only increased our candidate pool, but we also found that we were getting far better candidates in other markets. In the end, we hit a home run with the person we hired. Virtualization is here to stay and can be a key weapon in the war on talent.
If you can’t fill positions fast enough, have too many underperformers, it is an internal problem, not external. Put the best talent at your biggest problem. And engage all employees to be part of the solution.
Howard Shore is a business growth expert who works with companies that want to maximize their growth potential by improving strategy, enhancing their knowledge, and improving motivation. To learn more about him or the other activate group business coaches please call (305) 722-7213.