How to Hook Good Employees: Here's How to Land Good Recruits without Overfishing the Waters of Professional Search Firms
Nolan, John L., Mortgage Banking
HOW TO HOOK GOOD EMPLOYEES
Here's how to land good recruits without overfishing the waters of professional search firms.
Recently, the president of a mortgage banking company was surprised to learn that in the last six months more than half of the managerial and professional employees hired by his company had been referred by professional recruiting firms. The cost of these placements exceeded $100,000--almost enough to double the size of the company's in-house recruiting staff.
Such use of recruiting firms to fill managerial positions is not an uncommon practice. In fact, mortgage companies pay these firms millions of dollars each year for locating and referring job candidates. Many in the industry believe that the fees paid are entirely justified and strongly support the use of professional recruiters. Among the most commonly heard arguments favoring their use are:
* Recruiting firms have access to
individuals not actively in the job
market; * Recruiting firms can locate
candidates more quickly than the
in-house employment staff; * Recruiting firms understand the
unique nature of the mortgage
industry and are specially qualified to
recruit the kind of talent needed.
Those supporting the use of recruiting firms also contend that the fees paid are more than offset by savings on the lost opportunity costs of having the position go unfilled until the in-house recruiter can find a qualified candidate.
Each of these arguments has some merit. Recruiting firms can and do provide a valuable service. At certain times, they represent the most effective and efficient way to find a particular candidate.
Utilizing professional recruiting firms becomes a problem when companies routinely rely on them as their primary recruiting source, and in doing so, incur substantially higher recruiting expenses than are otherwise necessary. Given the costs involved, why do some companies become so dependent on recruiting agencies?
Typically, companies begin to rely on recruiting firms because the in-house employment group cannot fill positions quickly enough to satisfy hiring managers. The difficulty in filling positions arises from any one of three conditions. First, the in-house recruiting function is not adequately staffed. Second, company recruiters are not properly trained to locate and attract qualified candidates for professional and managerial positions. Third, the company itself lacks an established policy governing the use of recruiting firms.
In many companies, the recruiting function is simply not staffed to give hiring managers a high level of service. According to a 1986 national survey conducted by Costello, Erdlen & Company, the average in-house recruiter works between 25 to 40 job openings at any one time. Moreover, these jobs are not usually concentrated at a single organizational level or in one functional area. As a result, the in-house recruiter is forced to conduct simultaneous searches in unrelated areas (e.g., underwriting, production, loan administration). This process increases the amount of time needed to fill positions because candidates located in one search are not usually qualified for another opening. Finally, in-house recruiters have other duties that divert attention from recruiting activities. They conduct exit interviews, orient new employees, assist in relocations and counsel employees. This kind of workload severely limits the internal recruiter's ability to respond quickly to the needs of each hiring manager.
In contrast, outside recruiters work far fewer jobs. Many have trained research assistants helping to locate prospective candidates. They also tend to specialize in particular functional or geographical areas. These practices enable professional recruiters to dedicate more time to each search, find candidates more quickly and allow their recruiting efforts to gain synergy as candidates may be presented to multiple companies. …