The battle for recruitment agencies these days seems to have become one of relevance. To be viable, you need to be an expert in your niche, well-networked and knowledgeable about the market. You need to demonstrate value for money otherwise clients these days have too many options and ways to just do it themselves.
This state of affairs has given rise to an increasing number of opportunistic recruitment alternatives. Most are fuelled by the same sense of hunger and greed that witnessed the explosion of non-regulated recruitment activity in the 90’s to mid noughties and as such most are destined to stumble along and eventually fade away once the seed money has disappeared and reality bites. Because the reality is that it is very, very difficult to conjure up an alternative to (quality) agency recruitment that can have the same impact, the same effect, the same outcomes. Even many internal recruitment functions still have some way to go, although I sense some have caught up and are now overtaking, despite the recent blog from Greg Savage (and interesting comments that are well worth a read too).
I spied an article announcing the launch of another such “alternative” this week too. Described in Australian’s popular business publication BRW as a “Game-Changer” for the recruitment industry, this week saw the launch of The Search Party. The general ruse seems to be that recruitment agencies tip their CV databases into a central portal, where the identifying candidate details are removed and clients are able to then search for and access CV’s. Should the procurement of a CV result in an eventual placement then the recruiter who provided the CV gets to negotiate a fee with the client. I particularly like the quote from the founder Jamie Carlisle:
“Recruiters work for free 75 per cent of the time; they only place one out of every four roles they work on,” he says.
“The huge fees are to cover the costs of the work that didn’t result in a placement. We are offering a profitable and sustainable business model for recruiters, which allows them to bring down the fees and still be very profitable – which they are not at the moment.”
Several undeniable truths to be digested there: We do undertake an awful lot of work for nothing. That is the curse of the contingent recruitment model we have created and that probably is why we manage to justify the seemingly high placement fees when one does eventually come off. As for profitability, well I suppose this will help the more desperate, directionless, generalist recruitment businesses claw their way back towards profit… But surely this will be profit gained at the expense of satisfactory and fulfilling recruitment work?
Should this take off then what are recruiters to become? Administrators plastering ads across job boards to trawl up shoals of CVs to then dump into a faceless database with no consulting input? But then maybe that is the path we already embarked on a few years ago, especially when supplying to large PSA accounts, and this is just a smart way of making something approaching a silk purse out of the pigs ears our databases have become.
Because that is generally what agency recruitment databases are. A pigs ear, a dog’s dinner, an irrelevance. LinkedIn has made sure of that and that also leads me to wonder whether any client worth their salt would be better off signing up to LinkedIn Recruiter rather than buying access to this CV landfill. Any CVs worth accessing are probably authored by people with a LinkedIn profile too and at least their online profile will be kept constantly updated.
I wish Jamie well with this venture because it does seem to be offering a lifeline to a large part of the agency recruitment world. But if I’m being honest, most of the part needing a lifeline might be better off having the life support switched off. There won’t be much growth in the agency recruitment sector over coming years. Whilst there will be winners, there will be the equal amount of losers, and the ones sucking on oxygen generated from this scheme will only find it tougher and tougher to remain relevant.
So will it work? What do you think? The answer might be found by looking at the level of success experienced by NBR Talent right here in New Zealand over the past couple of years. This was designed to give recruitment agencies access to corporate clients (for a subscription fee) that they might not otherwise have done, albeit at a reduced placement fee of 10%. This scheme was accompanied with similar types of press releases to The Search Party’s with statements like:
“Employers and recruiters say they are beating the ‘Talent War’ by using NBR’s uniquely-developed New Zealand website.”
I’ve struggled to garner much positive sentiment about this offering from my contacts in the market, even from ones whose brands still appear on the website’s homepage. But then maybe they want to protect their secret that is doing very-nicely-thank-you-very-much. But the dated looking website and last tweet sent over a year ago does make me wonder…
Some feedback in the comments would be welcomed. Especially for The Search Party to read, who seem to have taken this concept a step further, but still have the jury out on whether this will indeed be a game changer, as so many of these recruitment alternatives profess they will be.