As a strategic business tool, contract recruiting can help a company focus on survival in the 21st century. To that end, HR managers need to understand how pivotal their own role is in selecting a contract recruiter who can oversee the process and, more importantly, successfully accomplish the company’s objectives. "There’s a war for talent out there, and anything you can do to stay ahead of your competitors is healthy, even if it’s only a short-term solution," says Dr. John Sullivan, professor of human resources at the College of Business at San Francisco State University.
Mazda moves quickly.
Last year, Irvine, California-based Mazda North American Operations restructured its HR department by taking recruiting out of the hands of managers. "It was just taking up too much time," says Allen J. Monicatti, Mazda’s manager of workforce strategies. So he interviewed outside recruiting agencies. "We wanted someone who could handle multiple priorities, work within a fast-paced environment, and who was customer driven. We feel we selected the one person who best fit our needs."
That person turned out to be Marj Dischler, the company’s now senior recruiting consultant. Dischler not only finds employees with the right sets of skills, but she makes job offers, assists in interviews and sets up appointments for managers. And she’s not recruiting for any other company, which means all the candidate information gets downloaded into Mazda’s own logging system.
Though it’s still too early to determine Mazda’s cost savings, "our customers seem happy with the response time of the new recruiting consultant," says Monicatti. "The most difficult part for our HR managers was letting go. In the end, though, it has given them a lot more quality time to spend with their customers, which is what we wanted."
Choose your recruiter wisely.
In reality, an HR generalist can handle no more than 10 open positions at any one time. Any more than that, and the hiring process becomes overwhelming, which is one reason why HR managers turn to contract recruiters—so they can leverage a way to get more done with fewer resources. "Most HR individuals have other responsibilities besides recruiting," says Barbara Kelly, an Irvine, California-based contract recruiter. "Contract recruiters help the generalists get the hiring done in a timely fashion, so they can move on to other things."
Still, you need to be careful selecting a contract recruiter because your company’s future can rest on it. And not all recruiters are created equally. So for openers, make sure everybody’s agreed on the definition of success, says Marion McGovern, president of the San Francisco-based M2, a high-end interim management/consulting business. "Does success in your company rest on how many candidates you run through the system, or does it rest on how many hires turn out to be successful? There’s nothing more frustrating for a recruiter than to find great people and then have to sit around and wait because the company that hired you isn’t ready to move."
As an HR professional, you also want someone who can quickly identify the best candidates for an opening, and who can put together an attractive offer. Look for a partner who’s more than just a recruiting arm—one who can help you develop an organizational-staffing plan.
Choosing the right contract recruiter for your company is an unnerving prospect, to be sure. Mazda’s Monicatti says the key lies in proper preparation, flexibility and clearly defined objectives. "Remember that you’re going to be paying the bills," he says. "If you don’t understand something, you’re perfectly entitled to ask a consultant to explain his or her advice."
A good relationship between you and your recruiter typically translates into a good relationship between you and your new employee. So put the effort into getting the process right from the start. Here are a few tips on how to make that happen.
- Look for recruiters who have the appropriate business experience.
- If you’re using a third-party service, find out how the recruiters are classified in terms of employment status.
- Check the recruiter’s workload.
Get referrals. Check references. Test the recruiters’ knowledge of your business and industry, and their contacts in the field.
Are they considered employees of the service who are paid on a W-2 or are they considered independent contractors who are paid on a 1099? These two scenarios have important IRS implications and require different management approaches.
You don’t want to hire someone who’s too busy with other clients. It’s also important to state expectations upfront about whether or not you’re comfortable with a recruiter doing work for other clients, particularly competitors.
- Clarify upfront whether or not recruiters can spend money on outside recruiting efforts, and if so, how much.
- Determine how involved contract recruiters will be in the hiring process.
For instance, can they use search firms to source candidates? Can they post positions on Internet job boards? All these things cost money and can add up quickly. If you expect recruiters to source candidates solely through cold calling and networking, make sure they have the necessary skills. If the recruiters are uncomfortable with the cold-calling approach, ask what their track record of success has been in the past. How many hires did they make on the last assignment? How many of those came from their direct sourcing efforts as opposed to passive approaches like ads and referrals?
For example, will they call prospective candidates to qualify them? Will they conduct interviews? Will they make salary offers and handle the negotiations?
- Hold regular meetings to measure and review progress.
- Keep an eye on the budget.
Set time-to-fill standards and make sure the recruiter agrees to meet them.
Don’t hesitate to query bills which you might not understand or which may seem unreasonable.
"Outsourcing is a way to consolidate information and data that can create a more powerful recruiting vehicle," says Margaret Watkins, founder of Atlanta, Georgia-based Select Resources, an onsite recruitment management company. "The core business of a company isn’t always recruiting. Everybody’s searching for the best and the brightest, and it requires a full-time effort. It helps to combine information inside the company with an outside resource. You don’t have to reinvent the wheel every time another assignment comes up. You don’t have to redo the same work. Everything boils down to time and money."
Outsourcing can be a godsend.
Above all else, keep your eyes on escalating costs with no return. You’re buying expertise and time. Most contract recruiters charge by the hour. And almost without exception, the people who come with their own contacts are the most valuable. Of course, there are alternatives to hourly billing. Some recruiters prefer fixed-price programs, which alleviate an employer’s concerns about out-of-control costs associated with hourly rates.
Naturally, you don’t want to come to work every morning and weed through stacks of résumés, especially if you’re already punching 16-hour days. And hiring contract recruiters can be a godsend to companies who need to focus on other business. They can help you find quality candidates in a cost-effective way, as long as you know upfront what type of recruiters you need to maximize your budgets.
But it’s not the only tool, just part of the tool kit. Still, hiring an outside contract recruiter is never as easy as it sounds. It works best when you have clearly defined objectives. But no matter how you slice it, old-fashioned networking, long hours at job fairs, Internet job posting and cold calling potential candidates are still part of the job—whether it’s you or someone else doing the leg work.
Workforce, August 1999, Vol. 78, No. 8, pp. 85-88.