By John Reilly
Labour market statistics for Feb-April 2022 (ONS) show the UK to have the lowest unemployment rate for nearly fifty years. Quite simply, it's a candidate-led market. There are more job vacancies than available applicants to fill them. Claire Warnes, Head of Education, Skills and Productivity at KPMG UK, said (June 22): "For over a year now, we have seen a sustained mismatch in the growing vacancy numbers in every sector against the inadequate supply of skilled candidates." It's been nearly half a century since employers have had this much competition in attracting the best people to work for their businesses, so getting your candidate-attraction strategy right has rarely been more important.
People are the lifeblood of any business. Your business essentially, is only as good as the people you attract to it. I like the quote by Jim Lesser, CEO of AD Agency BBDO in San Francisco, which I think applies to almost any business as well as any sporting club: “As an agency, we don't have some secret sauce that makes us better, other than our talent. Our talent is what makes us better.” I might have added that you have to task and manage your talent effectively but unless you recruit the people with the right ability and application, you won’t be hitting the targets you’ve planned for.
So how do you attract, recruit and retain the people that will make your business perform better than its competitors? According to McKinsey, superior talent is up to eight times more productive so securing the right people will have a considerable effect on your bottom line. Over the next few paragraphs, I hope to shed some light on not only what I’ve learned in more than twenty-five years of recruiting, but also relevant data and interesting insight from business leaders on the same question.
Talent likes a clear Mission and Culture is more important than Salary
Talent wants to develop. It needs to learn and grow and you have to provide the environment for it to flourish. Glassdoor’s 2019 survey shows that three-quarters of people consider a company’s culture before applying for a job; over half say culture is more important than salary and 73% would not apply to a company unless its values aligned with their own. Mission is even more important: nearly 90% believe in the importance of an employer’s mission and purpose. 60% in the UK say their company’s mission is one of the main reasons they stay in their job. It’s important that you communicate to each team member how they fit in. They need to know their exact part, their role in your mission and their abilities need to be complimentary with their colleagues'. A team full of centre-halves will never win the Premier League any more than a team of centre-forwards. Successful teams are a blend of skills and abilities and each member needs to know what you expect them to contribute.
Poor online reviews make it difficult to attract the best people
Obviously, your mission needs to be clearly communicated and your culture has to positive. If it isn’t what an employee expects they may be tempted to leave you a poor online review. Just as the hospitality industry has become significantly influenced by Trip Advisor reviews, so employees’ anonymous comments on employer-review sites such as Glassdoor; Indeed Company Reviews or Workadvisor are a key influencer on whether a candidate will interview with you. Occasionally I work with employers who’ve suffered bad online reviews from employees and it makes it very difficult to encourage candidates to meet them. The people you want to hire would be unlikely to stay a few days in a hotel or a few hours in a restaurant with poor reviews, so they’re unlikely to consider spending years working in a company that’s been trashed online by current and former staff. You have to care for your employees just as hotels and restaurants care for their guests. They can now anonymously tell the world if they don’t like what goes on in your company.
Looking after your talent is looking after your clients
Happy staff means happy customers. Glassdoor’s research shows there is a clear link between employee and customer satisfaction. On average, a 1-point increase in Glassdoor company rating is associated with a 1.3-point increase in customer satisfaction. Perhaps unsurprisingly, this link is even higher with client-facing members of your team. Clearly then, developing a positive workplace culture will have positive effects all through your business.
Innovation is key in talent attraction and retention
According to an IBM study, nearly half of Generation X (born 1965 – 80) and 42% of Millennials (born 1981-96) would leave their current job for another offering more money and a “more innovative environment.” Innovation doesn’t necessarily mean technology, it’s about how you treat the people who work for you. Alex Goryachev, MD of Innovation at Cisco says: “Innovation is always about people and for the people. If your company is perceived as innovative and cutting-edge, the easier it will be to win the war in attracting and retaining the best talent.” He mentions the importance of diversity: “If you are serious about innovation, encourage inclusion and diversity, whether that’s gender, ethnicity, cultural or socio-economic backgrounds, education levels or ages.” I find it interesting that he included the oft-forgotten age diversity, the poor relative of diversity initiatives. In my years of recruiting I’ve found discrimination by age to be by far the biggest limiting factor. In the US, where age-discrimination legislation came long before our own, they are significantly ahead of the UK in having more age-diverse workforces. Almost all age-groups value flexibility in the workplace and particularly as your employees begin to have family responsibilities they’re more likely to value flexible working. It’s an innovative benefit I’m often asked about by candidates and one increasingly in demand by men as well as women. In Deloitte’s 2019 survey of Millennials, over half said they would look to leave employers within two years that didn't prioritize flexible working practices (i.e. hours and location). I find there is still some resistance to this from employers although a 2016 CIPD global survey showed 83% of employers and employees saying adopting flexible working had resulted in productivity improvements.
Almost all age-groups value flexibility in the workplace and particularly as employees begin to have family responsibilities they're more likely to want flexible working. Covid has transformed how the majority of us work and shattered many prejudices about the efficiency of working from home. Even before lockdowns some element of home working was increasingly in demand by men as well as women. In Deloitte's 2019 survey of Millennials, over half said they would look to leave employers within two years that didn't prioritize flexible working practices (i.e. hours and location). A 2016 CIPD global survey showed 83% of employers and employees saying adopting flexible working had resulted in productivity improvements yet before Covid, I found still some resistance from employers. Now, some of my clients are insisting all staff will return to the office five days a week at the end of restrictions but most have recognised the genie is out of the bottle with home working and many will be offering at least some element going forward.
The only way is Uni?
What do the founders of Apple; Microsoft; Samsung; Honda; What’s App; McDonald’s; Virgin; IKEA; Cath Kidston and Chanel have in common? None earned a university degree. The other unfashionable diversity element mentioned by Cisco’s Goryachev is education level. Despite the success of people like Simon Cowell; Zoella; Karren (Lady) Brady and the UK’s three post-war Prime Ministers who didn’t go to University (Churchill; Callaghan and Major), the thinking persists that a degree is vital for even some basic roles. In my experience, many employers hire in their own image and likeness and if they're graduates themselves may be unwilling to hire outside that group. University is not for everyone, for various reasons and there is a rich seam of talent and potential among those who choose another route. Google, IBM and Apple are among many companies which now accept applications from non-graduates. Andrew Neil did exactly that when he edited The Sunday Times. He hired a young non-graduate to start in the post room who grew to be a journalist in a room full of Oxbridge alumni. His name was Simon Reeve and he’s now one of the BBC’s top travel presenters and a New York Times best-selling author.
University is not for everyone, for various reasons and there is rich seam of talent and potential among those who choose another route. Google, IBM and Apple are among many companies who now accept applications from non-graduates. Andrew Neil did exactly that when he edited The Sunday Times. He hired a young non-graduate to start in the post room who grew to be a journalist in a room full of Oxbridge graduates. His name was Simon Reeve, now one of the BBC’s top travel presenters and a best-selling author.
Is the CV dying?
The trend to look beyond academic achievement has been growing for some years in a bid to increase diversity leading to an increase in CV-blind hiring in favour of skill and aptitude tests. In 2015 Ernst & Young, one of the world’s top four Accountancy firms announced it was scrapping the requirement for applicants to have a minimum 2:1 degree and introduced a blind CV policy. More than three years ago The Spectator, Britain’s oldest magazine, ditched CVs in favour of an aptitude test and the title has been thriving. “One of our best interns”, said editor Fraser Nelson, was a middle-aged single mother who’d never worked as journalist. “She was brilliant and now works at the Sunday Times” he added. I see no end of the CV requirement from my clients, but relying on them as the sole criterion of a candidate’s suitability is certainly on the wane.
Sell your story on Social Media
Perception becomes reality for many and in an increasingly digital world, selling your story of innovation, culture and mission via social media is important. You can be sure that any digitally-savvy, finger-on-the-pulse candidate you’d be interested in hiring will have checked your business out thoroughly before deciding whether to interview with you. How’s your company LinkedIn page looking? Have you updated your company Facebook recently? Have you extended your reach on the world’s second largest search engine, YouTube and perhaps Instagram? If your social pages don’t give an insight into your culture and mission you’ll be missing a trick in selling your story not only to your clients and prospects but also the additional talent you want to attract to help you grow. Make your innovation achievements a feature of your PR work; showcase your individual employees’ innovation efforts and encourage them to boost these messages on their own channels to increase their reach. If your social pages have quality content and engaging stories with an insight into your company culture you’ll be highlighting the benefits of working in your business and demonstrating to our world of digital enthusiasts that you appreciate the importance of an effective social presence.
Tactics
When you believe your business is attractive to potential employees and you're actively ready to start hiring, should you use an external recruiter or not? If you have a sufficient flow of applicants coming to you directly, or you have the internal resource (because it's a full-time job) to reach out to enough of a candidate pool to build an acceptable shortlist, then you're good to go. Most businesses in a candidate-short market will not be in this position however and will likely need an external resource in the form of a professional recruiter.
There are a lot of us around, so how do you choose and get the best out of one? Firstly, find one familiar with your market and experienced in recruiting for your vacancy but also someone with whom you have a rapport as you'll be working as a team and communication will be key. When I say find one, I do mean one, at least one at a time. You'll get better results from any professional who is committed and accountable, something that should be guaranteed if you're working exclusively. Many employers take the view that the more recruiters they brief, the more candidates they'll see, when the reverse is more likely, particularly in a candidate-short market. If a recruiter knows they're one of three working on a vacancy, and therefore have just a 33% chance of being paid for their work, they're more likely to concentrate their efforts toward employers that give them more commitment. The average success rate for retained recruitment assignments is over 76%, whereas average success for multi-agency contingency recruitment is less than 20% (The Recruitment Network).
An exclusive, retained assignment guarantees you the recruiter and their research team's time and typically goes well beyond a contingency effort. Knowing they have your commitment means they can dedicate time with confidence and employ the resources needed to execute a pro-active search to find your best candidate. Industry averages suggest assignments yield five times the amount of people-hours spent on a vacancy compared to contingency.
Keeping the Talent you’ve got
Attracting talent is one thing, keeping it is another. You’ll build your business more quickly if your staff turnover rate is low and in a double benefit, a low turnover rate is in itself a selling point for new recruits. The key driver to staff retention is development opportunity. As I mentioned earlier Talent wants to develop. It needs to learn and grow and you have to provide the environment for it to keep learning and improving. When I ask job-seeking candidates why they want to leave their current position, answers I hear regularly are: “There’s nowhere to go where I am.” “I’m not learning anything new.” “I’m bored.” Talent needs a moving landscape and employers have to keep offering new opportunities for growth and development. Companies with few internal growth opportunities will always find it a challenge to retain its top talent no matter how good the work culture or benefits are.
Some leading business consultancies are now framing these approaches as a new science, which they refer to as EX – Employee Experience. Just as we think of UX, the customer’s experience of interaction with our business, products and services, EX encourages business to think about what working life’s like from their staff’s perspective. According to Dr Nick Lynn, a Senior Director at global business consultants Willis Towers Watson, “EX is an emerging science that uses new sources of data and applies new analytical approaches. EX gives a broad and holistic view of people and organisations and begins by understanding individual perspectives and small moments and events.” Ask your staff individually what it’s like doing the job they do for you. You might be surprised at the replies but they will give you the insight you need to keep making your company a more attractive place to work.
Summary - Hire from diverse groups, look beyond the CV and put your staff first
In short, if you hire from a diverse groups; put your employees first; look at life in your business from their perspective and give them the environment to be happy and the tools to grow, you’ll dramatically improve your prospects of attracting and retaining high-quality talent. As Richard Branson put it: “If you can put staff first, your customer second and shareholders third; effectively, in the end, the shareholders do well, the customers do better and you, yourself are happy.” It’s certainly an approach that seems to have worked very well for the Virgin boss and one many could benefit from adopting.