When you think of the most important person in your company who immediately jumps to mind? Your CEO? Your top salesperson? Your star engineer?
Did anyone think of your recruiter?
OK, try something else. Go talk to any CEO of a fast-growth firm and ask them about their challenges. Sure, they'll talk about scaling their infrastructure, growing their sales, etc. but at the end of the day, when you boil it down (Five Ways is a great way to do this) it comes down to one thing: talent.
Great CEOs know that their companies will sink or swim based on the quality of individuals that they are able to attract to come work with them. Billionaire venture capitalist Vinod Khosla says that new CEOs should spend more than 50% of their time recruiting. Steve Jobs got it, and worked to attract "insanely great" people to Apple. As the market for talent becomes more competitive, the contrasts between the "haves" (those who place a strong emphasis on recruiting) and the "have nots" (those who don't) becomes more stark.
Why don't more companies take recruiting more seriously?
There are a combination of reasons for this. Let's start with the fact that it's often difficult to quantify the returns to recruiting. Contrast this with sales compensation which is much more measurable. As Paul Graham points out in his excellent essay "How to Make Wealth":
Salesmen are an exception. It's easy to measure how much revenue they generate, and they're usually paid a percentage of it. If a salesman wants to work harder, he can just start doing it, and he will automatically get paid proportionally more.
People are trying to quantify recruiting so that better ROI calculations can be done but this almost always boils down to a "cost per hire" or "cost per start" number. Rarely do systems track new employees through the lifecycle of their time at the company to do a true recruiting ROI calculation.
Another challenge in the recruiting industry is that historically it's been a very passive industry (not to be confused with passive candidates). Put up some job board posts, create a cool careers page and then sit back and hope/pray that the right people apply for your company. And even if they don't, it's often more about choosing the best of the applicants rather than the best possible people you could potentially find for the position.
Morgan Missen makes this point in a recent, must-watch TechCrunch piece with Semil Shah. She goes on to say that that "recruiting is too important to be left to recruiters." While this might seem like a slam on recruiters, it could actually be seen as a call to action for companies to take better care of the recruiters who are working for them (be they internal or external recruiters). The notion of recruiting being a transactional industry is one that has arisen, at least in part, by the way that many companies view their recruiting function.
The best companies increasingly understand this. They devote resources to recruiting and celebrate their top recruiters in the same way they'd celebrate their top salespeople or engineers. And because of this, they are winning. Companies like Twitter and Facebook are pulling in new employees at many times the rate that they are losing employees.
These companies take talent seriously.
We started Entelo in part to empower companies that want to take talent more seriously. A new wave of companies like ours are putting powerful tools in the hands of recruiters (and anyone in a company responsible for landing top talent, often right up to the CEO) making them more effective at what they do. Our hope is that our efforts (and those of numerous other companies who are working on similar products) can make the phrase "rock star recruiter" something you hear thrown around a lot more in the future.
