Moving to a Mature Recruiting Model

Introduction

One of the defining characteristics great companies share is that they consistently hire more A-players. While greater brand awareness and strong compensation packages help, these companies also differentiate themselves by approaching recruiting from a more proactive and strategic perspective. They invest in tools, systems, and processes that enable them to make better decisions faster, and to anticipate talent needs instead of waiting for someone to quit to start their search.

This article will discuss these differences through the lens of the Talent Success Maturity Model, which groups companies into four levels of sophistication. This will help you to understand where you are today and what next steps could be taken to elevate your organization’s ability to hire the best and achieve talent success.

The High Cost of Reactive Recruiting

The common concern many recruiters and managers raise about proactive recruiting is that their existing budgets and schedules can barely support the work they perform today, let alone add new activities into the mix. What this perspective overlooks, however, is that reactive recruiting is also expensive in its own specific ways. For example:

• Do you begin a search only when a current person announces they’re leaving?
• Is the first time you see your company’s hiring plan Jan. 1? And does it assume new hires will start within a couple of weeks or even days?
• Do you have a large number of key people whom you hope don’t leave because you have no idea how to replace them?
• Do you frequently use contingency-fee recruiters for roles you hire for regularly?
• Do you have higher turnover among people hired in the past year?

Reactive recruiting trades the cost of investing in better processes today for the expense of longer time to fill, higher cost of hire, and increased turnover. And ultimately, the greatest cost of all is the missed opportunity to improve the organization by raising the number of A-players on board.

The Four Stages of Talent Success in Recruiting

The Talent Success Maturity Model provides a framework for understanding how companies recruit and how to increase your organization’s capability to consistently hire more A-players. According to Bersin by Deloitte’s 2014 High-impact Talent Acquisition brief, almost two-thirds of companies follow a reactive approach that places them at Stage 0 or Stage 1 as described below, and only 13 percent have reached Stage 3.

Stage 0: Chaos

Companies at this stage lack a deliberate, clear, and centrally managed process for hiring. Different sites or managers may follow completely different approaches for the same role, and core processes, such as generating an offer, are frequently done on an ad hoc basis. To the extent that standardized processes or documents exist, it’s usually due to “we’ve always done it this way,” rather than any intentional design. HR’s involvement is peripheral, perhaps limited to providing a slate of candidates, and may not know of a hiring process until being told that a certain person has been hired by a manager.

While very few companies may fit all of these criteria, even successful companies often display some of these characteristics. Companies at this stage experience a variety of problems, including reliance on costly third-party recruiters, long time to fill, and compliance risk from processes that are not monitored and properly documented.

Stage 1: Automating

The first stage of talent success maturity is to build standardized processes and systems. This can also be thought about in terms of repeatability, or the ability to perform the same process, such as hiring a salesperson, multiple times and achieve a similar outcome each time. At this stage, companies have standardized processes, documents, and standards in place for how new positions are opened and how employees are hired. They have also begun to implement tools and systems that support and enhance these processes.

While a company at Stage 1 still has many areas for improvement, it has built a foundation to ensure that minimum compliance standards can be met, and will likely see many small improvements as the worst practices are wrung out. There are also savings from reducing the amount of manual work required for lower-value administrative tasks.

Stage 2: Improving

In Stage 2, companies begin to focus on building their ability to consistently hire more A-players. At this stage, a company has built out detailed role profiles that define the organizational values, goals, and competencies that define what makes an A-player in each role. These companies have also begun to apply structured screening, assessment, and interviewing tools and methodologies that increase their ability to identify top performers. At this stage, companies will also have begun to systematically track quality of hire.

For most companies, the move to Stage 2 is the hardest, but it also brings substantial benefits. It’s at this stage that companies can begin to significantly increase the number of A-players they hire, while also reducing the number of hires who are either subpar or broadly qualified but a poor fit for the specific role. This has the potential to significantly reduce the amount of turnover among recent hires, which imposes a high cost in lost productivity in the role, as well as the expense of having to essentially recruit two people to fill one job.

Stage 3: Optimizing

At Stage 3, a company is achieving its top potential in terms of talent. These companies are often known as employers of choice within their industry or region. They’re also able to attract top performers from their competitors and outside of their industry. At Stage 3, the company’s approach to recruiting is extremely proactive, with a strong emphasis on long-term development. Strategies for replacing key employees are discussed and updated regularly and not limited to the top ranks of management. These companies often have defined career pathways from entry-level roles to management and senior roles, and invest in training and mentoring to fill more roles from within. Stage 3 companies also use detailed analytics to continually measure the performance and engagement of employees to identify trends of interest at the individual, team, departmental, and company-wide levels.

Companies don’t reach Stage 3 overnight. If you’re a mix of Stage 0 and Stage 1 today, it would be realistic to think of Stage 3 as a place you could get to in three years, though some companies will need more time, and smaller companies might be able to get there a little faster. What’s most important is realizing that getting there is a process of small, incremental steps that any company can take.

Your Road Map to Optimization

How you begin your journey to Talent Success depends on where you are today. If you’ve got a lot of Chaos around you, the first priority should be to bring everything up to Stage 1 before focusing too much on other improvements. Because stages 2 and 3 are all about process improvement and optimization, you need to have a system to deploy, manage, and measure processes before you can do anything else. Consider these items first:

• Core documents: Start by reviewing your job descriptions, communication with candidates, reporting, and offer letters. We’ve provided templates as a starting point with a guide for how to customize them to your needs. Make sure everyone involved in the hiring process has access to these and knows to use them.
• Improve your interviewing: Building a Better Interview discusses a generalized interview structure and feedback form that can be used for any position. This is a small but relatively easy win that will improve the most important step of the hiring process.
• Dump paper and spreadsheets: Moving your work from paper and documents that live on shared drives or scattered in email attachments will reduce administrative overhead. But make sure the system you select is capable of handling your needs not just today, but a year or two down the road. If you want to get to Stage 2 but your ATS doesn’t support things like competency models, then it may hold you back.

If you’ve already covered the basics, you might be ready to start working on Stage 2. Here’s one way to approach this:

• Pick a pilot group: Rather than trying to build a role and competency model for the whole company, start by picking a particular role, role family, or department to start with. This will give you a chance to see how the pieces fit together and make adjustments more quickly before trying to roll it out to the whole company. The right pilot group should be one you hire for regularly, that’s a value-adding role, and that has a manager or managers who are open to change.
• Build your role model and interview scorecard: This article discusses how to use roles and competencies to define the attributes of an A-player. This is the basis of everything else you will do in your talent management processes, including a detailed interview scorecard that every interviewer will use.
• Assess quality of hire: A quality-of-hire survey will allow you to measure the payoff of this initiative and identify areas for further improvement. Reaching this point will put you ahead of many of your competitors, as most companies do a poor job of measuring this.
• Continue the rollout: Now that you’ve figured out how to make things work in a small group, you can start working on the rest of the company.

Conclusion

While investing in proactive talent management isn’t always easy, Deloitte estimates that companies that have made the transition from Reactive Chaos to Proactive Optimization perform 30 percent better, on average (2014 High-impact Talent report). By breaking this down into a number of small, concrete steps, it’s feasible for any organization to set itself on the road to Talent Success.