Recruitment Process Efficiency - A lot more interesting than it sounds

As I discussed in last weeks blog, the recent masterclass I gave at a Lean Government event focused on cost efficiency and the development of a lean approach to resourcing.

I divided the masterclass into three topic areas, the first of which was ‘Process Efficiency’. Not a title to set the world on fire, I admit – but something which is a lot more interesting than it sounds – and if it’s not interesting it’s certainly worth knowing. Either way, it’s what I want to look at this week before moving on to ‘Skills Acquisition’ and ‘Blended Sourcing Models’ in future postings. As a whole I’m hoping that my practical approach will put you on a lean resourcing path.


A "One Stop Shop" is not necessarily Lean

In recent years a lot of businesses in both the public and private sectors have moved towards a one stop resourcing shop – this is either run by an in-house team or outsourced to an MSP (Managed Service Provider) or RPO (Recruitment Process Outsourcer). As a solution this may work - BUT, and it’s a big but (hence the capitals) it will be geared towards a ‘high volume, low unit cost’ model which will has a major pitfall – it encourages a strictly transactional hiring relationship with the candidates you target. (i.e. need a person – go to market, need a person - go to market etc, etc, etc).

‘You may think that your unit price is competitive, and indeed it may be, but the person you get will not be delivering value for money.’

This means that your cost per hire remains low, but that when you need skilled professionals you’ll be recruiting resource that is below par. Without a proper relationship with the market and some real resourcing expertise this approach will just carry on carrying on. You may think that your unit price is competitive, and indeed it may be, but the person you get will not be delivering value for money.


My recommendation...

My recommendation is simple - form direct relationships with businesses that are already active in the candidate market – those that can deliver the skills you need for the future. You need to do this in advance of any resource requirements. It is critical to ensure that your chosen recruitment partner is then able to track both active and passive candidates (i.e. the good one that aren’t looking for work) to ensure you get someone who is well aligned to your strategic objectives.


...then focus on your non-permanent population

From a total cost cutting perspective, it is our experience that most businesses will achieve the best results by focusing on their professional non-permanent population – be they contractors, professional temps, consultant or interims. – it is likely that a large percentage of this resource is not controlled by any process – and whilst the direct hiring relationship increases the chance of getting the right individual, the lack of control will have led to over-spend and increased risk.

We regularly see situations where contractors have been hired directly by senior stakeholders, against their own budgets, at rates significantly over the market norm. In addition, it’s unlikely that contractors will be operating via robust terms of business, or indeed have undergone the correct level of compliance checking (see Baroness Scotland for further information).


25% savings are a reality

Targeting non-permanent resource in a coordinated and constructive way - ‘finding and replacing’ where appropriate - will (on average) deliver 25% cost savings. Most larger organisations spend in excess of £2m on professional non-permanent resource and should be able to show a minimum of £500k in savings.

Handled correctly, you will have a strong relationship with expert recruiters (in specialist areas) that will deliver the talent that you need whilst working within a framework that delivers value for money and manages risk.

How you get to this point is another topic all together, but as they say – if you’re interested ‘Ask me how’!

Contact me on Twitter @NickWalrond, or by email at Nick.Walrond@sandersonplc.com. Or simply leave a comment below.


"Lean" Image source: Flickr Creative Commons - (Zepfanman)
"Piggy savings bank" Image source: Flickr Creative Commons - (AlanCleaver)