- Jo Faragher
In-house recruit teams are no longer just the preserve of large corporates. So how should agencies ensure they can still play a major role in recruitment strategies? Jo Faragher finds out
A trend thought to have been evolving for some time now is becoming of increasing concern to agency bosses. The idea that in-house recruiters can use social media and job boards for most of their hiring needs appears to have been confirmed by research released this week.
In a survey of more than 200 in-house recruiters, almost three-quarters of the employers surveyed said that they felt confident they could source all of the talent they needed through channels such as LinkedIn, Facebook and job boards. For most, the only time they would head to an agency would be to source specialist, non-core roles, the research by recruitment company VMA Group found.
Furthermore, while in-house recruitment was once the preserve of large corporates with the budget to attract skilled teams of resourcers, access to vast numbers of potential candidates via social media, together with increasingly sophisticated applicant tracking systems, means that the barriers to entry for in-house recruitment teams have been lowered.
Gary Franklin, founder and director of the Forum for In-house Recruitment Managers (FIRM), has witnessed this trend through his own organisation’s membership. “Five or six years ago, when I started FIRM, we were mostly made up of household names, big employers; in the past 18 months there have been lots more companies that are less well-known,” he says. “People are saying they want to reduce costs, improve the quality of hire and so they hire someone to do it. Often it’s just one person, but larger companies tend to have a team.”
According to Jeannette Ramsden, co-founder of staffing specialists The Curve Group, trends towards bringing recruitment in-house tend to be cyclical and are driven by budgets. She explains: “Companies see their agency spend go up and make the decision to bring that work in house. Then the cost of the in-house recruitment team goes up so they increase their agency use again.” However, she points out that establishing and hiring a permanent in-house team can be far less flexible when it comes to peaks and troughs in hiring, as it represents a fixed cost: “In-house teams grow because they might be tasked to fill 30% of all roles one year, then 50% the next and 75% the next – but if that percentage dramatically falls again, you might have to make people redundant.”
Matthew Edge-Wilkins is a senior recruitment and HR manager for Platinum Property Partners, a property investment franchise business based in Bournemouth. As a fast-growing small- to medium-sized business, building talent pools and identifying potential roles that will come up is crucial to its success, yet Edge-Wilkins chooses to source all PPP’s talent in-house.
“We work on a small annual budget, which means delivering 100% direct hiring with highly time and cost-effective sourcing strategies,” he explains. “By leveraging the latest online search techniques, social media (especially LinkedIn) and our own strong personal networks, we are able to find the best passive talent and engage them in our business.”
He goes on to argue that by getting recruitment right first time, this reduces future staff turnover, which in turn has a huge impact on productivity and growth potential. In fact, Edge-Wilkins is so confident in PPP’s in-house recruitment processes that the company is now making its recruitment services available to other SMEs via a service called www.myinhouserecruitment.co.uk.
But how can in-house recruiters be sure that they’re covering the full extent of the candidate market when they’re limiting their search to their own familiar channels? Azmat Mohammed, director-general of the Institute of Recruiters, argues that companies should see agencies as another network for their talent pipeline. “If an in-house recruiter doesn’t get the best from their preferred recruitment suppliers, saying that the only candidates they find are through their own talent pipeline, they’re cutting off a channel and will only get so far,” he says. “The isolated cost of the recruitment function is not the total cost of hiring; they need to look at the bigger picture.”
The IoR has launched a hiring guide aimed at helping businesses and recruiters work better together, highlighting the channels available to both in-house and agency recruiters – ranging from direct hiring via job boards all the way through to preferred supplier lists and recruitment process outsourcing. For agencies to rise above the trend towards moving an increased proportion of recruitment in-house, they must “be good at creating pipelines and leveraging their network”, he adds.
Where in-house teams do use agencies, this relationship typically works best when there is a long-standing partnership with the agency (or often an individual consultant), where the agency is granted access to hiring managers and there is a high level of trust on both sides. “Where organisations are using agencies, they’re rationalising and optimising those relationships. So preferred agencies become surrogate recruiters for the employer’s brand, truly working on their behalf,” says Franklin. Edge-Wilkins agrees, advocating a “lengthy preparation on both sides to ensure the external recruiter has the best possible understanding of the recruitment need, the department, the business and overall working environment/company culture.”
However, there will always be a tension between in-house teams and external recruiters. Internal teams are invariably busy because they have to manage all of the administration, liaise with line managers, deal with candidates and onboard them once they’ve been hired – so repeated phone calls from agencies, even if the candidate is perfect, are often unwelcome. Ramsden advises agencies develop one point of contact in the in-house team so that they don’t have to explain every time they call, and it’s possible to build mutual trust.
And while a few exceptional employers will say their aim is to cut out agencies altogether, it’s unlikely that this will happen across the board. One of the in-house resourcers surveyed by VMA makes the point that most companies will need to hire specialist skills at some point, and having the flexibility to engage an agency means they have access to the widest possible pool of talent: “It’s simply not worth my while to have highly specialist recruiters on the payroll who might only be called on once in a blue moon. Trying to handle absolutely every vacancy that comes up just wouldn’t be viable.”
The agencies that respond well to that need will survive the move towards in-house recruiting, concludes Franklin. “A good agency will work hard to be the solution in this case,” he says. “Even if they’re only filling three or four roles a year, but doing that across more clients, they’ll still hit their targets, just in a different way.”