WE FIND YOU Not many clients research or study recruiting strategies, but those who do realize that recruiting strategies fit into two categories: "You find us" or "We find you."
The more proactive relationship based category is the "We find you" approach, where a client has Diversit identify the names of top performers as individuals and then contact them directly.
The "You find us" approach almost by design attracts "the masses," while Diversit approach is more targeted to minimize the volume of applications and maximize the quality of the applicants with a higher ratio of successful placements.
“20% of hiring takes place through job boards”. Source: Social Media Job Seeking: Career Enlightenment “22.3% of new hires were attributed to the employer’s website” Source: CareerXroads
Proactive firms focus on this advanced but vastly superior approach. These individuals are generally not looking for a job and they may not be interested in (or even aware) of your career opportunity.
SIMPLY PUT In today's market, companies must adapt quickly to changing conditions. Now more than ever, having the right talent in place to support key business initiatives is critical.
The real mission of staffing is to “hire the best possible candidate, in the most advantageous of circumstances, as quickly as can be done and still done well". Diversit's methods are well recognized for its proficiency in uncovering clients’ true hiring criteria. It’s this factor that drives additional value to our clients.
Diversit recognizes each agreement as our only agreement.
COST OF EMPLOYEE TURNOVER So, what is the real cost of losing an employee? When you consider all of the costs associated with employee turnover - There are three cost categories associated with employee turnover: Separation costs account for exit interviews, termination administration, severance pay. Replacement costs account for attracting applicants, interviews, testing, and moving expenses. Vacancy costs account for lost sales revenue, increased overtime or temporary employee costs incurred while the position is unfilled; here's what it really costs an organization.
For mid-level employees, it costs upwards of 150% of their annual salary to replace them. For high-level or highly specialized employees, you're looking at 400% of their annual salary. Source: Karlyn Borysenko, Zen Workplace
Costs of lost productivity are as important as direct costs such as advertising or temporary staff. Total costs easily reach 150% of the annual compensation. The cost will be significantly higher (200% to 250%) for managerial and sales positions. Source: Bliss & Associates Inc., Wayne, NJ consulting firm RECRUITMENT A recruitment firm is a type of professional service firm that specializes in recruiting executives and other senior personnel for their client companies in various industries. Recruitment professionals typically have a wide range of personal contacts in their industry or field of specialty; detailed, specific knowledge of the area; and typically operate at the most senior level of positions. Recruitment professionals are also involved throughout the hiring process, conducting detailed interviews and presenting candidates to clients selectively, when they feel the candidate meets all stated requirements and would fit into the culture of the hiring firm. It is also important that such firms operate with a high level of professionalism and confidentiality.
Using a recruitment firm also allows the corporate entity the freedom of recruiting from competitors without doing so directly, and the ability to choose among candidates that would not be available through internal or passive sourcing methodologies. Niche recruitment firms specialize in a particular business industry sector. The contractual relationship between client and executive search firm falls into two broad categories: contingent and retained.
Contingent recruiters are remunerated only upon the successful completion of the "search assignment". Retained recruiters are paid for the process, typically earning a recruiting fee in stages based on the anticipated compensation of the candidate.
Contingent Search As stated, contingent search firms are remunerated only upon the successful completion of the search—typically when the candidate accepts the position. These recruiters may earn 15% to 30% of the candidate's first-year base salary or total remuneration. In any case, the fee is (as always) paid by the hiring company, not the candidate/hire. Contingent searches often require higher percentage fee basis, relative to retained searches. Retained search Recruitment firms get a retainer (up-front fee) to perform a specific search. Typically, search fees are typically 1/3 of the annual compensation. Fee payments may be made in thirds, 1/3 of fee paid on initiation of the search, 2/3 paid upon placement of the candidate. In a retained search, the fee is for the time and expertise of the search firm. The firm is exclusively contracted to conduct the entire recruitment effort from startup until the candidate has started working. The recruitment company will refund the retainer if unsuccessful completion of the search— within a specified time frame.
RECRUITMENT PROCESS OUTSOURCING (RPO) Over time, as business in general embraced the concept of outsourcing, RPO gained favor among management to reduce overhead costs from their budgets, and improve the company's competitive advantage in the labor market. Fundamental changes in the labor market also serve to reinforce the use of RPO: The labor market has become increasingly dynamic, workers today change employers more often than in previous generations.
Everest Group estimates the current size of the RPO market at US$1.4 billion in annualized spend with a growth rate of over 25%.
Employee vs. Recruitment Process Outsourcing There is a growing trend in today’s workplace of contractors rather than employees to perform necessary services. This trend is a result of a number of factors, including greater flexibility, reduced overall costs and often a greater specialization that contractors bring to a project. The distinction, however, has wide reaching implications for a company’s practices. An employee has certain rights on termination that generally are not available to contractors. Additionally, an employer is under statutory obligations regarding withholding and remissions for income tax, workers compensation, CPP and employment insurance. As well, employees have certain entitlements under the employment standards legislation, such as overtime pay, minimum wage and paid vacations, which are not available to contractors as well as the following:
• Salary and incentives (if applicable), Benefits, Company vehicle, Car allowance and/or gas, Hardware, software, Telecommunications, Office furniture, Parking, Security, Business expenses, Employee supervision, Human Resources (Onboarding, offboarding, training and development, payroll and other) and Cost per hire (Soft and hard costs).
Benefits RPO providers claim the method has lower costs because the economies of scale enables them to offer recruitment processes at lower cost while economies of scope allow them to operate as high-quality specialists. Those economies of scale and scope arise from a contingency of recruiters, databases of candidate resumes, and investment in recruitment tools and networks. RPO solutions are also claimed to change fixed investment costs into variable costs that flex with fluctuation in recruitment activity. Companies may pay by transaction rather than by staff member, thus avoiding under-utilization or forcing costly layoffs of recruitment staff when activity is low.
“An executive search firm or "headhunter" are typically small operations that make high margins on candidate placements (sometimes more than 30% of the candidate’s annual compensation)”. Source: Wikipedia
“Recruitment agencies today charge clients anywhere from 15% to 30% of a new hire’s total salary package for the first year”. Source: Recruit Loop
“Contingency agreements are entirely performance based and you don’t pay a recruiter until they successfully recruit an employee for your company. Typically, this is a percentage of the employee’s first year compensation package and can range from 15% – 25% of that individuals pay”. Source: Forbes