TA Capability Vs Business Requirement

Why aligning your Talent Acquisition Capability to your operating environment makes strong financial sense.

Scott Comte – Snr Consultant. Crew Talent Advisory

In a recent blog, I talked about the fact that to attract passive candidates to your organisation you need to make it easy for them to get to know you. You need to understand what candidates are looking for from their next role and employer and make sure that the relationships that you are building with your candidate market are consistent with these needs.

When I talk with TA and IT professionals about this they all nod sagely as they know both the pain and challenge of not being able to source the right talent when needed. Often times the ability of an organisation, especially those in the ScaleUp phase of their development, to execute on their business plans is contingent on their ability to source the right talent in a timely and cost-effective manner. Could not having the right type of recruitment function be costing you money?At Crew Talent Advisory we see the evolution of the organisational Talent Acquisition function in a three-phase maturity model.

The first is what we call the Reactive Recruitment function. In this phase, an organisation identifies a recruitment need and then starts resourcing from a standing start. Recruitment is usually undertaken by the business founders in addition to their day jobs. They often will source candidates through their networks and if that doesn’t work they will run their own ad on a Job Board and/ or utilise the services of a recruitment agency. These approaches are tried and tested and usually deliver the result required a new hire! The cost to the organisation is the owner`s time, a few coffees and lunches, a Job Board Ad and potentially agency recruitment fees. Once the process is finished everyone goes back to their day jobs until the next recruitment need pops up.

In terms of cost of ownership of the recruitment function, this approach makes intuitive sense, as long as recruitment volumes and the commercial opportunity cost of not filling roles on time remains low. If volumes of hires go up this can become a very expensive way of acquiring talent! Standard metrics for a Reactive Recruitment function will often be just several hires.

As an organisation grows, for StartUps this is often facilitated by securing funding rounds, both the importance of acquiring talent and the risk of not acquiring talent to an organisation`s commercial well-being increases dramatically. At the same time, the effectiveness and cost of the Reactive Recruitment Model diverge quite dramatically. In response to this most organisations develop their TA function into what we describe as the Functional Recruitment Model. In this phase, organisations establish a dedicated recruitment function resourced part or full time by dedicated recruitment and/or HR professional. They invest in an Applicant Tracking System to automate recruitment administration tasks and establish different candidate sourcing channels such as LinkedIn Recruiter, Internal Staff Referral Programmes and various recruitment technologies.

The investment in establishing a Functional Talent Acquisition Capability is often based on being funded by reduced agency spend. It is, however, predicated on the fact that recruitment is a reactive activity, that is, the recruitment function only delivers to business talent acquisition needs as and when required. For anyone working in the Technology or Digital space in an organisation with 15+ staff this means that the recruitment function is constantly going to market for new hires, often as a result of staff turnover.

Also, the cost savings from reduced agency spend often don’t eventuate as the TA function struggles to deliver results in a candidate tight market. However, in a stable candidate market a well resourced and managed Functional Recruitment Capability will allow an organisation to maintain the status quo and also drive incremental growth at a more financially sustainable level. Metrics for Functional Recruitment may include percentage fill rates, time to hire and cost per hire.

For some organisations, Talent Acquisition is a strategic lever, not only to drive growth but also as an essential component of the organisations operating model. We see these organisations adopting what we have defined as a Proactive Talent Acquisition Model. In this model, the TA Function is constantly in the candidate market establishing and nurturing relationships with Talent that the organisation may need. To effectively manage this they leverage technology that includes Applicant Tracking, Candidate Relationship Management and specialist online search systems.

The key to the success of this model is that the Talent Acquisition function already has warm relationships with the talent that the organisation needs. The candidates know the organisation and understand how a career with the organisation could be of benefit to them.

So when TA reaches out to them about roles they are much more likely to be willing to consider an opportunity than candidates who have no relationships with the organisation.

The costs to establish this type of capability is not insignificant. However, the cost savings from reduced recruitment agency spend combined with the high probability of securing the talent an organisation needs make this the optimal Talent Acquisition model for any organisation of scale or organisations with high growth trajectories. Metrics to measure the effectiveness of Proactive Recruitment functions should be aligned with broader organisational metrics as well as operational measures such as time to hire, fill rates and quality of hire.

When organisations want to scale and compete in a tight candidate market such as Technology and Digital they need to consider the Proactive Talent Acquisition model. Anything else may put them at a competitive and financial disadvantage.

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