How to buy your future…

Posted: May 4, 2011 in Uncategorized

Back in the dark old days a file search meant getting on ones knees in front of a draw full of dead trees and hoping that the files in the folder marked ‘Toolmakers’ actually contained the typed, faxed or hand written resumes of ‘Toolmakers’. A candidate would come in and register by filling out the front and back of the application card which you would fold in two and put coloured dots on to indicate their skills. A temp job lookup involved you looking in the the plastic box on the window sill and looking for green “stores” or brown “fitter” and orange “boilermaker”.

In today’s recruitment world we know the value of working with fewer numbers of better quality candidates. While it is quite feasible to have a box of cards on your desk and make a lot of money… why would you? These days there are an abundance of software tools that can automate the process and add efficiencies that cannot be matched by paper based systems. The question to ask is which one is right for your business?

Selecting software for your business can be a daunting task, there are so many things to think of and each of the questions and answers change depending on the size and nature of your business. If you are an Executive Search firm then you business might be driven by permanent placements,in the recruitment to recruitment space the focus is on the reverse marketing of candidates and if you are a multi-branch health business you need to have a system that can handle high volume, single day bookings for multiple divisions.

When starting the conversation in your business about what system you want you should establish what are the current systems you have and what parts you want to replace. For example if you already have a payroll and invoicing system do you really want to replace them? If you do, then you will need to decide if you want a complete suite from one vendor or if you want to integrate different solutions from multiple vendors.

One of the benefits of a completely integrated solution is that you will have one central account manager or relationship manager and you can expect that all the parts of the system will work seamlessly together. One of the drawbacks is that you may have to deal with limitations in one module because you are “locked in” to all of them. Large systems that involve every staff member from recruiters through to accountants are going to require a significant deployment investment that includes significant training. Make sure that if you are going down this route that you look past the sticker price and clearly identify the costs of training, hardware and support.

Software should compliment your business process and address needs at every level. So the first thing you need to do when selecting a system is to get “coal face” stakeholders together and work out what parts of the system are essential for you. This is the specification or the “spec”. In drafting the spec don’t be surprised to have the CFO and the receptionist in the same meeting. Or to look at it another way: do you want a system that doesn’t have financial oversight or a system that is cumbersome at the data entry level?

The key contributors to your spec should include stakeholders from: Recruitment, Sales, Administration, Finance, Marketing and IT. If your business has an number of divisions you will want to make sure you are evaluating the recruitment process from each one’s perspective. You then need to write a feature list and rate each item as required, important or desired perhaps in a spreadsheet with a tab dedicated to “Recruiting’, ‘Sales’, etc.

Take your spec and email it to the software companies that you are interested in. If they can’t be bothered responding to it then they probably are not that customer focused or your needs do not suit their offerings. You should put your efforts into making a spec and sending it out prior to engaging with software sales people.

If you are starting a business then you are probably going to want a web based system. This will mean that rather than spending time setting up and installing software on your PC or server you can most likely get up and running right away and leave the “IT” to someone else.

There are hundreds of web based systems out there and more coming online each day. These range from older systems that have been “web enabled” to purpose built applications. The benefits of web based systems include working from anywhere, no hardware costs and often ongoing updates. Some systems allow you to have a fully integrated web site and others the vendor just places you logo on their page. One of the potential drawbacks is that you can only access your system when you have an Internet connection, however these days to be in this situation you would probably need to be on a remote island, most likely on holiday and probably do not want to be working anyway!

If you are looking at a web based system then the sort of questions to ask include:

  • How does the solution integrate with social media like Facebook and Twitter?
  • What are the contract lengths?
  • What happens to my data if I want to stop using your system?

Rarely does any software meet 100% of you desired criteria so another important factor in selecting software is looking at how much it is able to be customised to your needs. Ask your vendors about what sort of things they can add. Often you can get some customisation “thrown in” at the commissioning of the system.

Regardless of the size and nature of your organisation the selection of software should be a detailed and well thought out process. You need to evaluate the risk and benefit of each factor that compels you to make a selection. By using a clear specification and involving as many stakeholders as possible you will not only have a clearer picture of what your needs are but also more staff “buy in” at deployment.

The job advert market today:

In the online job advertising markets in Australia and New Zealand there are a small collection of jobs boards that dominate, such as www.seek.com.au and www.trademe.co.nz.

Traditionally “everyone” knew that to get a job or find a candidate you went to these epicenters of online advertising and a connection would be made.

As we have progressed, we have found that the information wants to be free [1].  It doesn’t care if you are the original content (job advert) producer or if it was passed on through the various networks of the Internet.  The other day I Tweeted out a job for a new client on the Twitter account I manage for them. The next day my friend Google found it on some obscure web site in rural Queensland.

One thing to accept about the Internet of today and tomorrow: You cannot control your content.

Many of the bigger brands camp out in the EGN (early general news) section of our newspapers. They will tell you (and their clients that are footing the bill) that this is a great way to gain access to the passive candidate marketplace. These are candidates who weren’t really looking until your advert writing gold sprung forth before their eyes.

So if the passive marketplace is such a great place to find candidates, what does it tell us of our friends in rural Queensland and the content of ours that they are re-posting? In the battle for passive candidates, if the EGN section is nuclear warfare to the dead tree readers then surely micro content aggregation [1]  is death by 1,000 cuts? If your message is leaking out here, there and everywhere then how much propagation does it take before the value of the EGN is eroded?

I have to admit my bias here; my cat has more current exposure to newspapers than I do. I tend to consume other media (online & radio) for news and information.

What is this content aggregation that you speak of?

Content aggregation is where sites and services take other people’s content and massage it into their own offering. One example is: http://www.careerjet.com.au/

In times gone by, some of the big web sites didn’t like this as it meant you were not going to their site and viewing their other adverts. This is a terrible argument as it meant that you pay for an advert on their site and they stop it getting out on the Internet. Nice one.

Social Media

Some see social media as a relatively new way of marketing. From a business perspective, it is a way of raising brand awareness, having a conversation with the public and delivering content, for example job adverts. Social media implies a web site with high traffic (or an integration of such a site into another one [3]) that allows relationships to be made and content shared and commented on.

This content aggregation idea within social media sits on the shoulders of giants. On the Internet many different technologies have attempted to get messages out. One of these was RSS feeds. This technology was based on the idea we would all have a client (like our email program) and draw feeds in from around the web into one ‘list’ of content we were interested. Anyway, it turns out that we are too lazy for that when there are other more ‘fun’ or particle ways to achieve the same thing.

Probably one of the most interesting part of modern communication is that message sizes have decreased significantly. In days gone by adding volume to an advert gave it substance and made it stand out in the newspaper. Now we have 140 character limits on some message providers so we have to abbreviate and get to the point.

What does this mean for Recruiters & HR personnel?

You have to come to terms with the technology involved and how to use it. For example, in Twitter you use ‘#something’ to create a link from the text ‘something’ to other posts containing the word ‘something’. You might use it like this:

  • #job #Perth Perm role for #Accountant finance industry ….

If you don’t bother to read the abundance of literature and training sessions on using social media then you will miss the point and it could have implications that range from just being ineffective to corporate embarrassment. For Twitter, read this: http://business.twitter.com/

There are probably hundreds of courses and seminars our there on this topic. One example is: “The Essential Social Media for Recruitment program developed by www.insidejob.com.au ” which kicks off in March.

And beyond…

Another point worth considering is that the online world won’t ever go back to the ideas of yesteryear. It is fashioned and refashioned by the young and will always move on beyond how we currently communicate. No one has the luxury of sitting back and defining that language or dictating to every community on the Internet what is the “right and proper” way to draft a message.

Perhaps in a few years time, the job ad above will be Tweeted out as “#j-WAP.AC$” and that will make perfect sense to everyone!

Promotion below…..

How does Recruit Online use social media on behalf of its’ clients?

Recruit Online is a Recruitment, CRM, ATS and DMS system. It is a large suite of online applications that work well with multi branch companies but also automates a number of tasks which mean that sole practitioner’s and small businesses can utilize the latest technologies to promote their brand and their jobs.

The the most obvious way that we encourage social media integration is by providing candidates with the opportunity to link and share every advert on our clients’ web sites to all the leading social media platforms. This is the first step in putting the jobs on the social media map.

Also, we have had good success with using Twitter to slice open channels in the online community and deliver the specific messages of our clients. Typically we open an account for them and configure their Recruit Online system to regularly go through their jobs and tag them up (with #tags) and send them out. This is a fully automated service but still allows them to hop online and add their own conversations to the information flow.

Another part of the service is that we re-post our clients’ jobs to our own jobs board and it too has its’ own Twitter account. Over time all the jobs are sent out from more than one source. This means that the content aggregating sites out there are more likely to pick up on the trail and repost their jobs.

You can find out more about Recruit Online here: http://www.recruitonline.com.au/

Piers Rowan – Director @ Recruit Online

[1] – http://en.wikipedia.org/wiki/Information_wants_to_be_free

[2] – http://en.wikipedia.org/wiki/Aggregator

[3] – There are technologies which allow you to manage your social media site from another (perhaps smaller) site. For example you can send your LinkedIn updates out via Twitter from the LinkedIn site. There are many sites that allow you to connect back to a social media platform, including Recruit Online, using features labeled: “Log in with Twitter/Facebook/LinkedIn”.

One of the biggest issues facing sales dependent service industries like the Recruitment industry is how to motivate their employees (particularly Recruiters) to make more placements. For many businesses their livelihood is contingent on their Recruiters making placements and this means that even though they might have many jobs on they still might loose the job to another candidate and subsequently not make a cent.

In this environment there is a requirement to have all Recruiters motivated to sell their services on an ongoing basis. One of the tools in the management mix is that of commission payments. Financial incentives fall into a few broad categories:

  • % of Gross Profit when budget is achieved
  • Fixed $ per period when budget is achieved
  • Fixed $ per milestone (for example a new client bonus)

One of the biggest questions in commission schemes is should you pay individual or team based commissions? The answer is (as always) it depends. Some points to consider are:

  • Is “the team” a branch or business unit within a branch or a state or a nation?
  • Does “the team” have the ability to be rewarded for their efforts or are they “carrying” other members of the team (who are out of their control)?
  • If you have a high volume temporary business and your staff are on individual commissions, will you foster an environment of teamwork or will it lead to factions and candidate hoarding?
  • If you have one team going great and others failing, will you end up paying out $1,000′s in commission but be loosing money on a national scale?

This list goes on and on and the reality is that it depends on what sort of culture your business is, what size it is and what you want to achieve with it (grow, consolidate, sell, etc).

Debunking the 3 x Salary myth:

There is a common idea that is bantered about that as a rule of thumb, Recruiters should bill 3 x their salary. This rule is reflective; meaning that if you create a notion that “3 x salary” holds water then your Recruiters should expect to be paid $100,000 when they bill $300,000 in a year. Therefore in some circles this theory is a loaded gun that Managers should be careful of.

For example if you have a Sydney office and decide to open a Melbourne branch, it is going to mean that your Sydney office is going to fund the Melbourne office for 3 – 24 months. This means that the amount of surplus in the business available to channel back into commissions is reduced. By not planning effectively you may find that you have a two sided cost battle on your hands; on one side you have a successful business that needs to be fed, and on the other you have a start up that you need to pour cash into to get going.

We have put together a calculator to help you get the idea of a few different scenarios on your business. The ’3 x Salary’ rule does work to some degree however there are some cases where it does not. As with all rules of thumb it is designed to give a good guess which works in many cases and to that end it is OK, however if you have a multi-branch and growing organisation – particularly if it is in different markets, locations and sectors – then I would suggest that you consider the effects of head office costs to a greater degree than the ’3 x Salary’ model allows.

What does this calculator do?

You enter some information about your business make up (or desired business make up) such as:

Branch Information:

  • Consultant salary
  • Administrative salary
  • On costs of employment
  • Branch rent
  • # of consultants / administrators
  • # of branches
  • Other branch costs

Head Office Information:

  • Accountant / Management salary
  • Payroll salary
  • Insurances & Legal costs
  • Other costs
  • On costs of employment (Super. WC, PRT, etc).

Sales Information:

  • Ave Gross Profit per hour
  • Ave Permanent placement fee
  • Ave # of temporary staff / clients
  • Target gross margin or budget
  • Ave # of permanent placements / Client:

The calculator will give you a break down of the costs and the considerations of the 3 x Salary model, ROI model and budget target model. It will also give you some examples of results depending on Recruiter performance. In the real world you cannot expect to have every Recruiter hit target every time so it is prudent to consider the effects of different levels of performance on your business. The following scenarios are presented:

  • If 100% of recruiters hit target
  • If 80% of recruiters hit target & 20% hit 2/3 of target
  • If 50% of recruiters hit target & 50% hit 2/3 of target
  • If 20% of recruiters hit target & 80% hit 2/3 of target
  • If 50% of recruiters hit target & 50% hit 1/2 of target
  • If 50% of recruiters hit 2/3 target & 50% hit 1/2 of target

Please take a look at our commission calculator tool.

Well, according to a number of on line dictionaries – nothing [1]. In fact, it doesn’t appear to exist. So why does it appear in so many adverts and on so many business cards? Don’t get me wrong, it sounds cool and implies what I think it means, but it’s not like I have any way of looking it up.

I can look up doctor, secretary, toolmaker, lawyer, baker, logistics manager but I can’t look up resourcer – it’s a made up / pretend word.

What is a resourcer [2]? As far as I understand (and it varies from place to place) it means: “…a recruitment consultant who doesn’t do sales…” These are typically people either entering or reentering the industry who get to go home on time and don’t get paid as much as their colleagues with sales responsibility.

I think the role of “resourcer” is a key one but really what does it say about our own self importance when we think that making up or using fake words is appropriate (and then criticising resume grammar :-) ?  What does it say to the consumer of our services when they are most likely ignorant of the meaning implied by this word?

Sometimes we need new words for new things like Internet, aspirin and biodiesel; but seriously, does this job warrant such attention? Other new jobs like “Help Desk” seem to have gotten by without a fancy new word entering our diction haven’t they? “Help Desk” could have easily been “Turnitoffandonagainer” but the IT industry seemed to avoid that little gem.

Perhaps there are alternatives:

  • Resource Consultant
  • Assistant Consultant
  • Consultant Assistant
  • Recruitment Consultant
  • Recruitment Coordinator
  • Junior Recruitment Consultant

My point, whilst unavoidably flippant, is simple:

As the professionals in the HR/Recruitment industry, is it not a key requirement that we communicate effectively? If so, when introducing new terms to an industry, don’t we encourage an arms race of made up job titles that ultimately confuse candidates and employers in equal measure and make our jobs even more difficult as we wade through misleading job titles on resumes and in job descriptions?

</end>

[1] – There are a number of dictionaries that give very “colloquial” definitions that may offend some. But the mainstream ones we checked included:

[2] – One Resourcer I know describes herself as a “Junior” consultant who will be promoted to “Recruitment Consultant” when she has enough experience. Another is doing all a Recruitment Consultant’s tasks without doing the sales. A business owner I spoke to said he wanted a Recruitment Consultant but didn’t want to pay for one.

Updates on ROL

Posted: November 26, 2010 in Uncategorized

Hi there!

We have been frantically working on our own web site. For a while there we had a CMS (content management system) and a separate web site for our CRM database.

One of the principles shared by the ROL crew is that software doesn’t have to be “shrink wrapped” and that you should always have the ability to customize, extend and in some cases swap out parts of the software platform. Since ROL can do this we thought we would ditch our CMS and extend our CRM into powering our web site – fancy that, ROL actually using ROL to show case ROL. Brilliant!

This means we have been able to integrate a host of ideas into now what is a blank canvas of opportunity. You see, our “web site” is powered by our CRM so it has access to every feature and piece of data we have. If we wanted to create widgets (web site mini features) we could at the drop of a hat – without disturbing the core of the ROL platform.

Imagine that – your web site, your vision, your ideas extending and integrating as far as you want without the administrative overhead of two separate systems. Want to have an advert engine for your top client’s as a value add? Done! Want to have a SMS the manager button? Done! Want a floating banner of your top ten contractors updated in real time with a “hire me now” functionality? Done!

We are very excited about the ideas our clients are coming up with on what they want on their web sites. If you have any ideas then please get in touch with us – the team @ Recruit Online.

Hi I’m Piers Rowan and we have just set up this blog to keep our customers updated with news, stories and ideas that don’t belong on our web site. Recruit Online provides software to companies who are looking for:

  • HR systems
  • Recruitment / applicant management systems
  • Customer relationship management databases (CRM)
  • Casual / temporary booking management tools
  • Knowledge management tools

Hopefully we can give you a more human side to our business by injection some personality into our profile!

</end>