by Alex Lockey
Bonus Material: Recruitment Activity ROI Tracker
Today, I’m going to show you the recruitment agency benefits (and the disadvantages) that will save you £10,000s.
Once you’re done you’ll have all you need to make better decisions when it comes to using a recruitment agency.
There are 3 main recruitment methods:
This an oversimplification but we’re focusing on the one in this article:
We’re covering a few benefits of a recruitment agency:
Let’s get started.
Think about it, good recruiters should be in contact with scores of people per week. They will probably speak to more people in your industry than you could ever dream of (if you want to that is!). What an opportunity. They’re privy to every opinion and piece of gossip in the industry.
They should know what strategic moves your competitors are making and details of industry performance benchmarks. Recruitment agencies can help you build an attractive offer as they are aware the strengths and weaknesses of comparable vacancies.
You should focus on yourself, not your competitors, but knowing what they’re up to can help. Picking the brains of a good recruiter can save you money.
It can lead to new business opportunities and help you avoid the pitfalls of hiring a dud. If a recruiter is entrenching in a niche, they can help you derisk that next big idea. You can have them seek a wider opinion on a candidate’s credentials.
Exclusive candidates are those that wouldn’t apply for any vacancy should you advertise or work with any recruiter going. They’re only passively looking rather than actively scouring job advertisements for a move. They may have sensitivity attached to a move or be working for one of your direct competitors.
When you’re hiring for any role, your goal should be to hire the best candidate for that role at that time. A good recruitment agency can give you a picture of the whole market and present your opportunity to all suitable candidates, not only those actively looking.
From the moment of job analysis through to advertising or engaging a recruitment agency and then assessment, the hiring timeline is prone to creep. This is often because you can’t be sure of the quality and/or quantity of the response to the vacant post. A good recruitment agency can give you an idea of how long it will take and also should shorten the time it takes to hire.
We’ve all been there. You apply for job and then wait. Then you wait some more. Five weeks later and you might hear some feedback if you’re lucky. How did that wait make you feel? Valued? Like you’re a priority?
Now, what if that is your star candidate? The person to help you on your mission? Time is crucial in the hiring process, especially in a competitive candidate market.
The true cost of hiring should include:
The common perception of using a recruitment agency is that it’s expensive. It is a front loaded investment but they can support you to avoid overspend on the areas above, as can the right advertising or, even better, a brilliant internal referral system.
Hiring is one of the most expensive and risky activities an organisation carries out. If you can derisk it then why wouldn’t you! Recruitment agencies should be one cog in your hiring machine.
I believe that a good hiring system should incorporate a stellar referral system, internal resource, great recruitment marketing and recruitment or search consultancy when needed. At the right time, on the right vacancy, with the right recruiter - recruitment agencies can save you a bag of money.
Employer brand is what candidates in your industry and your employees say about you as an employer when you’re not in the room. It’s corporate speak for if people think you’re good to work for or not.
Think about hiring in 2020. Location of a candidate is less relevant. It’s easy to get a lot of applications to a vacancy. Everyone has universal access to job market information. Therefore, you need to work hard on your employer brand to stand out as an employer of choice. A good employer brand will lower the cost of hiring and set in motion a Hiring Flywheel.
When you instruct a recruitment agency, they become an extension of your employer brand. You have chosen them to represent you to potential new team members. They are the first point of contact (brand touchpoint) with prospective employees.
They can enhance by identifying and shining a light on the virtues of working with you, being courteous and communicative, and having a high degree of integrity. They can detract by inaccurately describing your organisation and opportunity, wasting prospective candidate’s time, spamming, not relaying feedback, and commoditising applicants.
You get the picture - it’s an important responsibility. Guard your employer brand well.
Often the secret weapon in recruitment agencies winning your business. They will offer to insure their fees by offering a rebate or replacement guarantee should a hire not work out.
Like any good insurance policy, they derisk a purchase. You won’t get a refund on job advertising spend so it makes the investment in a recruitment agency fee more palatable.
Here are the disadvantages of using a recruitment agency:
Let’s get started.
A good quality recruitment agency identifies and helps you to secure the best match for your vacancy. They enhance and amplify your employer brand along the way.
Unfortunately, the barriers to starting a recruitment agency are low. You need an internet connection and a computer. You used to need a phone but most use Voip now.
Echoing some of the points in the employer brand section above, a poor quality candidate experience can detract from your reputation as an employer.
You have little control over conversations and communications that a recruitment agency has with people in your industry. This includes managing application processes, head hunting, and being privy to your confidential company information. A good recruiter is a source of industry knowledge, so it’s important to have relationships with the good ones.
You ask more than one recruitment agency to fill a vacancy for you at the same time.
Imagine instructing 3 law firms to defend you in court. You offer to pay only one of them if you’re successful in your defense. If you win, you will pay the firm based on who you think the judge spoke to first. The trouble is you also have noise cancelling headphones on.
Do you think the 3 firms would treat your case seriously? At best they’d assign a junior with a template summary for you on the off chance it might work. This is what recruitment agencies do when they work on vacancies alongside others.
There is an oversupply of recruitment agencies so they’re often falling over themselves to win your work. This does not mean that choosing multiple recruitment agencies will result in a higher quantity and quality of candidates. You relinquish control of your employer brand, must control multiple inputs, and often end up in bun fights between agencies over candidates (who did the judge look at?).
We’ve all been on the end of it; untargeted communications that are not relevant. Low quality emails. Speculative CVs. Sales reps who have no idea about what they’re selling. Everyone hates it. Do you want your employer brand associated with it?
A recruitment agency is an extension of your hiring team, they are the first point of contact for prospective team members. It is imperative that they represent you well.
If you work with a recruitment agency, it’s going to cost you up front. The best will ask for a deposit and, with the majority of the rest, you’ll be invoiced around the offer or start date.
As with any business expense you need to add it to your budget and forecast. It’s important to understand the payment terms with your recruitment agency before engaging. They should also be able to give you a strong estimate on the hiring timescales.
Factor in the full cost of hiring when making your decision on how you recruit.
In short, it depends.
At the right time, on the right vacancy, the right recruitment agency can be worth their weight in gold. Quite literally. However, it’s important to avoid the detritus floating around and complement with your own strategies.
I’ve given you plenty of ammo for your decision making. If you want to take it a step further, download our Recruitment Activity ROI Tracker and you can keep an eye on outputs.
We can hold your hand to build you a talent machine.
We get results. This might mean you outsource all of it to us, or we give you the tools you need and move on. In reality, it’s usually a mix of both.
What you need to succeed:
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