The Internet has become a potent tool in the rush to help employers find engineers and other technologists who might want to switch jobs. But who is most fit to winnow out the likely candidates corporate HR teams or the breed of outside recruiters commonly known as headhunters?
Placement professionals point out that the headhunter worth his fee is often better connected and more nimble than in-house teams, able to deliver the strongest candidates by responding more quickly than corporate HR staffers can.
However, human resources teams are growing more empowered by the Web and are learning how to reach candidates directly as well as how to market their companies to attract talent. Now, with access to much of the same information as headhunters, savvy in-house HR teams are innovating and changing the way recruiting is done.
"There are great things about Internet recruiting," said Kim Butler, of Greywolf Consulting Services, an Austin, Texas, technical-staffing house. "You can get your opportunities out there. It allows companies to have very broad-based exposure and get access to resume databases. That all sounds great on paper, if you are the only company with access to it. But the great candidates tend to get eaten up very quickly," and a human resources department that moves at less than Internet speed can get left in the dust.
"You have market realities that put clocks on market transactions," Butler continued. Even a few days of delay could mean the difference between a hire and a wasted opportunity. Staffing managers "have to make those decisions before they start spending money on recruiting. If you're not willing on the back end to make a cold call or do an aggressive sales approach to candidates in written form or direct contact if you can't turn around a phone interview in 24 hours, can't pre-qualify and can't turn offers around in two or three days then it makes no sense to even pursue mass-market candidates."
For some companies, the Internet has made it possible to trim back the number of outside recruiters, leaving headhunters scrambling to find jobs not for others but for themselves. Justin Hall, staffing manager for Intel Corp.'s network communications group (Sacramento, Calif.) and a former headhunter, said the Internet has separated the wheat from the chaff when it comes to third-party recruiters.
"We have very, very positive relationships with a couple of different search firms, and 99 percent of the others out there we do have some tension with," said Hall, who uses three placement companies on a regular basis. The reason for the friction: The vast majority of recruiters vying to do business with Intel are hoping to charge the company for a service it can, and does, perform itself.
"There are very few barriers of entry to headhunting. All you really need is a phone book and a phone," Hall said. "Combine that with the Internet and you've got a wonderful means to be able to find candidates."
But, he added, "We have all those means to find those exact same candidates," the ones who, since they're on the market, are considered "active" job seekers.
Other tech companies are betting that they can bring new employees onto their teams primarily by using the Web.
"My strategy is to put nearly all of our eggs in the Internet basket. I'm going to try to minimize agency recruiting and control it better," said Joe Javorski, director of worldwide staffing for Analog Devices Inc. (Norwood, Mass.). That approach can work, as long as a company knows what to do with the resumes it's going to receive, he said. ADI plans to hire 1,000 workers this year.
Of course, Javorski noted, "There's a time and place for agencies, especially for very difficult, hard-to-find jobs and regionally isolated jobs." Indeed, ADI uses at least 30 outside recruiting firms and keeps a stable of roughly 60 more for occasional calls. Add that to the company's 12 full-time recruiters and 17 more half-time hiring staff, and the dollars spent on people power just to find more people quickly add up.
ADI's postings for IC and mixed-signal designers, for example, typically churn up about a half-dozen resumes. Of those, Javorski said he can expect two to be from qualified candidates. By comparison, he said, a human resources listing might generate 20 to 30 resumes, with far more coming from appropriate applicants.
Still, he said, the Internet is now ADI's primary channel of netting resumes and will soon be the main source of new hires. In fact, said Javorski, the only thing that beats Web recruiting is an employee referral network.
Why pay recruiters?
So why should any company pay $20,000 for the services of a recruiter who is in effect doubling up on a job someone in HR is already performing? On a cost-per-hire basis for most jobs, Javorski said, using a search firm is four to five times more expensive than using the Web and doing the legwork yourself.
"We've spent a lot of money developing software that allows us to search all of the job boards we have access to at the same time" as many as 30 to 40 at once. "It makes us much more efficient than recruiters can be," Intel's Hall said.
On the other hand, said Hall, who directed corporate staffing at Level 1 Communications before Intel bought out that company in 1999, headhunters can find "passive" job seekers, those who don't know they'd be happier working for someone else. Yet.
"I still find headhunters bring a lot of value to the table in helping us find those passive job seekers. They effectively present our opportunities in a way that the candidates will talk to us but not to others. I work with these people at a very strategic level."
With the economic slowdown apparently a reality, and as earnings tighten the screws on tech budgets, Hall predicted pain for many recruiters who haven't mastered the art of the sell. "If your only training has been to find candidates on the Internet and present them to companies, those types of headhunters are going to find some choppy seas ahead," he said. "But those who work as true partners, there's always going to be value."
One way to find people is the job boards that were the Internet's hot ticket a couple of years back. However, taking out a regular listing on a major jobs board can be pretty pricey. Monster.com, the Internet's leading job database, charges $275 to list a single position for 60 days, said Dean Rosingana, a spokesman for the company. So it's easy to see how posting 500 slots can add up, though Monster does offer packages for heavy-use customers.
HotJobs.com, which fancies itself more of a full-service site, will list 20 openings, in six different categories, for $700 a month, said Simon Goddard, vice president of sales at the "e-cruiting" concern. "If you want to buy additional postings, you can add them," Goddard said, for $25 apiece. For your money, said Goddard, you not only get a job listing and access to some 2 million resumes, but HotJobs will also provide staffing software to track applicants online.
"Recruiters and most ad agencies recommend spending 10 to 15 percent of a recruitment budget on Internet efforts," said Brian Weis, president of the Association of Internet Recruiters. "We usually recommend that companies post on a variety of sites, including national ones like HotJobs and Monster, as well as industry-specific sites" such as those dedicated to IT and engineering.
"I don't think it's enough to just do your own Web site," ADI's Javorski said. "You need some assistance."
Keeping up with Joneses
Is the money well spent? It can be, Weis said. A recent study by the Society for Human Resource Management found that the cost per hire for companies that rely on newspaper ads to display their openings was nearly $4,000, against only $1,400 for those who use the Internet.
Critics argue that the need to keep up with the Joneses in recruiting has created a culture in which hiring managers are spending first and asking questions later, or not at all. What's more, Greywolf's Butler noted, the bigger fish to a certain extent subsidize smaller fry.
"The greatest impact of the Internet on the recruiting world has been to shorten cycle times," said Butler, the former director of worldwide staffing at Applied Materials. "In the late '80s and early '90s, if you wanted to reach someone you had to do it by phone, mail or fax. The technology has turned over so dramatically in the last decade. Now you just drop a text document into an e-mail and the guy's got a signed offer on his computer."
On the other hand, Butler is far more skeptical of other tassels that human resources software companies try to pitch. He's particularly unimpressed with online prequalification programs ("the level of complexity that you can get is minimal," he said) and other tools that jack up the price of packages.
Staffing budgets could be a fair bit leaner, in Butler's view, if only hiring managers asked the following question of their technology: "It's a nice bell, but does it make any noise?"
To be sure, said Weis at the Association of Internet Recruiters, some companies have taken their staffing needs to the Web because they think they have to. But that's not the case for most. "I don't think they're spending money just to follow the leader. I think they're spending money because they're getting the results," he said.
From Weis' perspective, the Internet and recruiting "is a match that needs to be made." Despite the slowdown, few dispute that the early 2000s are so far seeing a continuation of last decade's buyer's market in high-tech employment. And that trend has created a savvier population of workers.
At the same time, he said, the flowering of the Web has given companies a place to market themselves both to customers and, as a sideline, to prospective employees. One need only go to the "work at" pages of any Fortune 500 company to see how eager these businesses are to differentiate their lunch rooms from those of their competitors.