Talent Acquisition Challenge

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    THE TALENT ACQUISITION

    CHALLENGE 2009

    Recruitment trends and issues

    impacting todays leading organizations

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    Introduction ..............................................................................3

    The Challenge ............................................................................4

    Recruitment Process Outsourcing ............... ............... .............. ..7

    Weathering, Even Leveraging,the Downturn .....................................................................9

    Look to the Future ...................................................................11

    About the Sponsors .................................................................12

    C O N T E N T S

    C H A R T S#1: Environmental impacts

    on recruiting .......................................................................4

    #2: Internal recruiting practices ....................................................5

    #3: Use of technology solutions ....................................................5

    #4: Most commonly outsourcedrecruitment processes ........................................................7

    #5: Most common reasons tooutsource recruitment processes ................ ............... .........7

    #6: Most common reasons to outsourcerecruitment processes ........................................................8

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    As the world faces unprecedented demographic, economic and competitivechallenges, recruitment and retention remains a top concern. Recognizing

    the critical role talent acquisition plays, leading organizations are maintain-

    ing focus on attracting and retaining talented people. To assist forward

    thinking employers in how best to overcome these recruiting challenges

    and capitalize on current opportunities, the Talent Acquisition Challenge

    Report was developed by three industry thought leaders: Pinstripe, a lead-

    ing provider of talent acquisition and retention services; the Human Re-

    sources Outsourcing Association (HROA), the definitive independent mem-

    bership organization for HR outsourcing; and TPI, one of the preeminent

    sourcing and advisory firms.

    The result is newly released data compiled from multiple sources over a

    year-long period that captures the pulse of the talent acquisition market in

    2008 and identifies trends and opportunities for 2009.

    I N T R O D U C T I O N

    The Talent Acquisition Challenge Report leverages data from:

    The HROA/Pinstripe/TPI global survey conducted in the Fall 2008

    Pinstripe HR Leader Polls conducted across 2008 from predominantly

    mid-sized organizations

    TPI Prevalence DatabaseTM ongoing data collected from Fortune 1000

    companies

    The RPO Summit, in Washington, DC, in December 2008

    A summary of the insights from those efforts, as well as the collective

    knowledge of three of the sectors leading organizations, follows.

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    T H E C H A L L E N G E

    Talent ParadoxToday, demographics and the global economic slowdown are significantly

    impacting hiring and talent management in both negative and positive

    ways producing a talent paradox. This talent paradox is created when

    organizations face skill shortages in some geographies and business units,

    at the same time that they experience reduction in force and an over-

    whelming surplus of applicants in other areas due to high unemployment.

    Leading HR practitioners interviewed at the 2008 HROA RPO Summitin De-

    cember, expressed uncertainty regarding the current economic climate and

    its impact on recruiting. There was a shared belief that in difficult economictimes, while many unemployed candidates may be available, currently em-

    ployed individuals are reluctant to risk changing employers.

    Historically, currently employed individuals have taken a conservativewait-and-see approach. Housing market uncertainty inhibits relocation de-

    cisions; financial stability of the new organization and looming severance

    packages all create hesitancy among talented employed candidates to start

    a new endeavor.

    With unemployment approaching the highest rates in decades, recruiters

    face new challenges that require an overhaul of:

    Recruitment marketing strategies (Why advertise at the same rate with

    reduced requisitions and more candidates available?); and

    Selection and hiring processes (With an overwhelming number of appli-

    cants for some positions, deploying tighter selection criteria during a

    variety of steps in the hiring process is recommended).

    Environmental impacts on recruiting1

    0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

    Economic downturn

    Skill shortages

    Multiple generations in the workforce

    Increasingly aggressive c ompetition

    Globalization

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    Internal recruiting practices2

    SOLUTION % ENGAGING

    Utilized sourcing from the web and social networks 80%

    Utilized job boards 68%

    Added additional internal recruiting staff 45%

    Added or enhanced technology 42%

    Utilized resume banks 41%

    Added contract recruiters or recruiting assistance 35%

    None 5%

    Use of technology solutions3

    T H E C H A L L E N G E

    Recruiting as a Marketing ActivityMany organizations have neither an active recruitment process in place nor

    recruiting professionals who see recruiting as a marketing activity. In fact,

    many organizations lack even the most basic recruiting strategy, relying

    instead on a practice of post and pray.

    For those who have embraced proactive talent acquisition strategies, the

    most commonly used are web solutions (including social networks and job

    boards), advanced technology, and resume banks.

    0% 5% 10% 15% 20% 25% 30% 35%

    Post and pray with no plans to enhance

    Post and pray with plan to improve

    Basic with no plans to enhance

    Basic with plan to improve

    Proactive

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    0% 10% 20% 30% 40% 50%

    Decrease the time to hire

    Lower the cost of recruitment

    Improve candidate quality

    Increase candidate volume

    Gain access to technology

    Improve market outreach

    As with any business challenge

    where efficiency, cost savings and

    innovation are needed, leaders

    face the build-or-buy question. Is

    the most optimal choice internal

    reengineering, outsourcing, or

    status quo? For some, recruitment

    process outsourcing (RPO) may be

    the answer.

    The fastest growing segment in

    the HR outsourcing arena over the

    past several years, RPO is

    garnering a lot of attention and

    increasing market size. Long term

    HROA research has indicated a

    significant uptake of recruitment

    outsourcing between 2005 and

    2008, from as few as 17 percent of

    organizations to as many as 47

    percent outsourcing some portion

    of their recruitment processes,

    and continued growth is

    anticipated.

    As illustrated below, organizations

    utilize outsourcing for all aspects

    of the recruitment process and

    find cost and efficiency benefits

    from those business choices.

    Organizations have a wide variety

    of reasons for outsourcing recruit-

    ment processes, and there really

    isnt broad consensus on the main

    reasons. Most commonly organiza-

    tions say they outsource recruit-

    ment to decrease time to hire and

    lower the cost of recruitment. The

    next most common reasons cited

    are increasing both candidate

    volume and quality.

    Most commonly outsourced recruitment processes4

    Most common reasons to outsource recruitment processes5

    R E C R U I T M E N T P R O C E S S O U T S O U R C I N G

    0% 10% 20% 30% 40% 50% 60%

    Background checks/drug screening

    Reference checking

    Candidate screening

    Ad creation and placement

    Name generation and sourcing

    Recruitment technology

    Job posting distribution

    Temporary help

    Recruitment marketing/ad strategy

    Selection/assessment testing

    Interview scheduling

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    R E C R U I T M E N T P R O C E S S O U T S O U R C I N G

    Agree

    Disagree

    Most common reasons to outsource recruitment processes6

    RPO Impact

    Outsourcing parts of the recruitment process and utilizing end-to-end RPO

    have a positive impact on the quality of candidates an organization can

    attract; half of respondents to the HROA/Pinstripe/TPI Talent Acquisition

    Survey agreed that their RPO programs have improved the quality of

    candidates their organizations attract. This finding is important as

    improving quality of candidates is included in the top three reasons

    companies turn to RPO. A significant number of respondents also say that

    RPO helps their organizations gain competitive advantage and bring about

    positive change in their organizations.

    0% 10% 20% 30% 40% 50%

    Improves the quality of candidates o ur organization attracts

    Helps my organization gain a c ompetitive advantage

    Brings about positive change to my organization

    Is part of our talent management strategy

    Benefits candidates as well as hiring manager

    Helps my organization reduce costs

    Strengthens the role of HR with senior management

    Is necessary for my organization to operate in todays economic c limate

    Is the solution to the managing the fluctuations in staffing demands

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    W E AT H E R I N G , E V E N L E V E R A G I N G , A D O W N T U R N

    Finding, hiring, and retaining the right people remains a challenge throughall economic climates.

    Difficult economic times may lead to limited resources across some func-

    tions and an overwhelming number of candidates in others. Although re-

    cruiting may be down, the number of people looking for a job has in-

    creased. As a result, there are more resumes to consider, more candidates

    to interview and more responses to compose, regardless of the decision on

    their candidacy. Unfortunately, contrary to the perception, recruitment

    teams may be busier than ever during downturns especially if the resources

    in the Recruiting Department become part of staff reductions and realloca-

    tions.

    Encouragingly, organizations that take time to build infrastructure during a

    downturn will be better equipped to ride out the cycle and will be better

    positioned when things improve. In order to do so, it is necessary to take a

    step back to evaluate and revise workforce plans, talent acquisition proc-

    esses, and technology approaches.

    1. Evaluate Workforce Plans

    Whether companies engage RPO providers or take on the recruitment proc-

    ess internally, now is the time to build in efficiencies, maximize existingtools, eliminate waste, innovate, manage vendor relationships, and estab-

    lish strategic partnerships.

    2. Review Talent Acquisition Processes

    Leverage Your Hidden Goldmine

    One of the most commonly overlooked tools in any organization is the ex-

    isting database. A real goldmine of information, the resumes collected by

    recruiters and HR staff over the past years should provide great leads on

    passive and active candidates.

    Tap Your Current Employee Pool

    Identify individuals who have been interested in gaining experience in other

    functional areas and who would be willing to wear two hats during difficult

    times. For the right employees, the current climate might provide real op-

    portunity to gain much needed and desired experience in other areas.

    Strong employees will appreciate the opportunity for long-term career

    growth, and it will demonstrate how much you value them.

    Review Your Funnel and Revise Your Processes

    Companiesmay have fewer openings, but will have many more people ap-

    plying, which will significantly increase the amount of time spent screening

    and responding to applicants. This will exhaust HR teams and could actually

    increase effective cost per hire. This is the right market to adopt a high-

    volume recruiting model for processing a high volume of candidates, in a

    time of low job requisitions.

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    W E AT H E R I N G , E V E N L E V E R A G I N G , A D O W N T U R N

    3. Upgrade Your Organizations Technology Tools

    The technology available to find and communicate with candidates has be-

    come more sophisticated and is core to both active and passive candidate

    recruiting. This includes: job posting distribution (like Viper and eQuest);

    posting aggregators (including SimplyHired and InDeed); SEO (search engine

    optimization) offered by Jobs2Web; and, candidate search and marketing

    technology like AIRS SourcePoint. These types of technology aids are in the

    portfolio of any proactive recruiting department and RPO provider. Most

    integrate easily into many standard ATSs. If they arent integrated, then a

    download/upload or import/export is available to connect the technology.

    The marketplace is moving toward a comprehensive technology solution

    that creates a one-stop-shop for talent acquisition where integration is on

    one platform. HR management technology consolidation goes beyond tal-

    ent acquisition to encompass a full suite of services for talent management

    that is available to employees and managers on a self-service basis. These

    include workforce planning, talent acquisition, performance management,

    learning management, payroll, and succession planning.

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    L O O K T O T H E F U T U R E

    Even (or perhaps especially) in an economic downturn, the demand for tal-

    ent remains a top concern for the nations leading organizations. Organiza-

    tions that seize opportunities presented during downturns not only to

    attract and retain top talent, but also to build a recruiting infrastructure

    that is flexible and scalable are most likely to thrive in any economy.

    Now is the time to innovate and embrace solutions that will drive future

    growth.

    The market has shifted from a scarcity to an abundance of candidates in a

    very short time, so organizations need to adjust accordingly to be certain

    that they arent overspending or spending in the wrong areas. However,

    this is a great time to be out in the market as the competition for talent is

    much lower. To take advantage of i t, companies should remain active but

    identify cost saving initiatives such as renegotiating existing relationships

    with providers; no one should be paying last years rates!

    Protect Your Brand! The few companies hiring will receive hundreds or

    thousands of resumes for every job they post. It is critical that they incorpo-

    rate tools so that they dont miss good people or alienate future prospects

    and customers. This is particularly important for consumer brands, as every

    applicant is also a possible customer or patient.

    As bad as it may seem, remember that every downturn yields winners and

    losers. Companies that are strategic are most likely to weather the current

    economic climate, and may even emerge as more efficient and successful

    organizations.

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    A B O U T T H E S P O N S O R S

    Known for innovative and uniquely effective

    sourcing of talent, in addition to executing on

    customer-focused process improvements

    Founded: April 2005 by an experienced team

    of HR, HRO and RPO leaders and industry

    veterans

    Total Employees: 136 FTEs; Average Recruiter

    experience is 5 1/2 years; Pinstripe Leadership

    Team (12) average HR Leadership experience is

    over 12 years

    Headquarters: Brookfield, WI; 32,000 square

    foot Service Delivery Center; 9,000 square foot

    training facility

    Target Markets: Commercial - Global 5000;

    Healthcare - Domestic Healthcare Systems

    www.pinstripetalent.com

    Worldwide sourcing advisory firm

    Nearly 400 advisors

    Completely independent and unbiased

    Provide sourcing advisory services in:

    IT

    HR

    Finance

    All other business functions

    Our goal is to help our clients optimize their

    business operations through a combination of

    insourcing, shared services, outsourcing and

    offshoring.

    www.tpi.net

    The HROA is the definitive independent

    organization for all those who purchase,

    provide, or participate in HR transformation

    and outsourcing. Our membership

    encompasses over 7,500 HR executives,

    including the largest 50 buyers, the top 30

    providers, the leading sourcing advisors and

    attorneys, and the best thought leaders in HR

    Transformation. The HROA brings its diverse

    membership together to set standards and

    practices, provide peer networking, and

    maintain a robust curriculum.

    For additional information about the HROA or

    to join, visit www.hroa.org.

    www.hroa.org

    Talent Acquisition Challenge | 12

    http://www.pinstripetalent.com/http://www.tpi.net/http://www.hroa.org/http://www.hroa.org/http://www.hroa.org/http://www.hroa.org/http://www.hroa.org/http://www.tpi.net/http://www.pinstripetalent.com/