Do We Really Need Recruitment Agencies? | BTalk Australia

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(14min 21) What benefits do recruitment agencies provide? With the advent of online job-sites can't you do the job yourself and save a fortune on agency commissions.

In today's BTalk Australia Phil Dobbie talks to Kelly McGowan, a director of recruitment site sixfigures.com.au. She says agencies still have a role to play although the shortfalls often relate to the relationship between the agency and the recruiter. Phil suggests a better way of structuring the way agencies and clients work together.

Add your thoughts and experiences in the Talkback section at the end of this post.

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• Today's Transcript

Phil Dobbie: Hello, I'm Phil Dobbie and welcome to BTalk Australia. Today, recruitment agencies, do we really need them? They add to the cost of recruiting and do they really know what we're looking for? To answer the question of whether we need recruitment agencies or not, let's ask Kelly McGowan. She's the director of sixfigures.com.au, which describes itself as a premium jobsite for executives and senior professionals. Well, first of all Kelly, tell us a little bit about the site. How long's it been going for? And hasn't SEEK really got the online recruitment market sewn up?
Kelly McGowan: In answer to your first question, we launched 10 months ago and we provide an alternative to a service like SEEK, which is very much a general site. We see sixfigures as a niche executive site, which is very successful overseas, in fact, and we're just starting to see the niche sites really catch some market share in Australia. So, although SEEK is definitely a force to be reckoned with and provides a good general service, people at the level we deal with don't necessarily relate to or look to a general site like SEEK. They want to go where the jobs are relevant and where they're actually receiving a more professional service.

Dobbie: Now you've worked on both sides of the fence. You've worked in recruitment; now you're running a jobsite. You've worked on the agency side and you've also worked as a recruiter, inside the corporate world. So I guess you've seen it from all angles. With sites like yours around, it's easy now to get the news about a job out to the job seekers. Does that take a lot of the power of the recruitment agencies away, and the value that they add to the process?
McGowan: No, I don't think so. I think there's probably two things going on there. Yes, you can get your job out there and the jobs are out there everywhere, they're duplicated and it's very much hit-or-miss, because I am out there everywhere and anywhere. And, like any good marketing, it's actually knowing your audience and targeting your marketing message to the right audience. Because there's so much buzz going on out there, often your message does get lost. If you aren't targeting your position to the right audience, you will get inappropriate applicants.

Dobbie: Right.
McGowan: And you're probably not going to be attracting the best people. So there're two arguments for that: the key is to get it out there, but there's no point in getting it out there if it's not hitting the right people. It's a waste of marketing spend, really. And going back to the value of recruitment agencies and recruitment consultants, I think like anything, you've got recruiters who are just fabulous and add an immense amount of value. They know the industry inside and out. If a client can provide them with a good brief or they can get a good brief out of the client, they can add immense value because sometimes businesses don't have that expertise internally and that often happens too, at the more senior levels. They might be comfortable recruiting, for instance, a call centre operator or an opening or something that's sort of quite practical and tangible and easy for any of us really, to recruit for. It's pretty black and white. But when you're looking at a position that has a lot more intangibles, where you're looking at understanding skills and personal attributes and all those other sort of non-tangible things, I guess recruiters that have had a lot of experience and are specialists, they win hands down because they're living and breathing it every day. They understand what's going on in the market.

Dobbie: Although you have to rely on that brief from the client.
McGowan: Correct.

Dobbie: And if the client isn't very clear on that brief, of course you can be left not really understanding what it is that they are looking for. And they might have in their head exactly what they're looking for but they don't explain it particularly well.
McGowan: You're correct. I think that's a problem that does occur --- within an organisation, "Oh, this person has left, we need somebody". We just needs somebody like that person or different people will have different ideas because obviously, you've got sort of different politics, if you will, going on internally. So, as the recruiter, it depends on the relationship you have with that client. And it depends, I guess, on how sophisticated they are when it comes to hiring. To some it is, they give you a very vague brief and they themselves don't know what they're looking for so it's next to impossible to deliver them what they're after. But, the more they can work with you, the more information they can give you about what they're looking for and also why anyone should even consider that job ---that's the second part and that's, I guess, where recruiters can also add a lot of value ... if the client is in a position to share a lot of information with them and that information around what's so great about this company and this role. Often, you find recruiters are very good at selling, so they're in a much better position to get the applicants to see why it's such a wonderful opportunity (which can sometimes be lost when you're recruiting internally). Not always, but sometimes, I guess, they aren't as able to get as excited and to sell the division and the organisation as maybe someone from the outside. It really depends, obviously, on who's hiring.

Dobbie: Yeah, I guess it also depends on how glamorous the business is as well.
McGowan: Sure.

Dobbie: Some jobs, I guess, everyone's after.
McGowan: They don't need to be sold, no.

Dobbie: That's right.
McGowan: Although, it's interesting, I think these days too, we're seeing that even those businesses that used to just be able to rely on their name and the talent walked through the door --- that's changing. Those sort of big companies are losing their shine, I think, and they're all in a position where they have to work harder to attract people. So I think those days are slowly going.

Dobbie: You mentioned some, like call centre jobs, for example, can be a bit black and white in terms of their requirements. I know sometimes that's an argument that's leveled at recruitment agencies, even for top jobs. They have a definitive set of requirements, which have been set by the client.
McGowan: Correct.

Dobbie: So understandably, they're following those, but sometimes, when you're dealing direct, that might be an opportunity for somebody to come along who says look, I haven't got A and B, but I've got C and you haven't really thought about that, had you?
McGowan: Yes.

Dobbie: And the boss is there, going hmm, I see you're right ... good point.
McGowan: Again, that comes back down to the relationship and if the client actually will allow you to consult. I found that throughout my career. You have those clients where it is a bit more of a production line-type attitude; match them and give them someone that's sort of done it before and we don't really want your input or so on. Whereas you've got others that will really work with you and you can consult to them --- they are the ones, generally, that are the better employers and that will attract the top talent.

Dobbie: Yes.
McGowan: And so it's that ability, actually, I think that's too, where both HR and recruiters can work together more effectively, being able to spend more time up front, understanding that brief, and letting the consultant have input and looking at candidates that might be left of field. And going with that, if that consultant, instead of feeling very passionate about why these clients should consider them, I think being open to that. So it's a bit of a two-way street, I think. We just need a bit more collaboration.

Dobbie: Now, of course, it's a numbers game as well. Every time a job's advertised, I think particularly in this climate, it's not unusual to have 100 or more applications.
McGowan: Yes.

Dobbie: And very lengthy CVs, which is, I guess, that's where this preoccupation almost with having the right keywords in your CV comes up.
McGowan: It's an interesting one. I have some sort of issues, again, around this focus just on matching keywords and it more relates to this executive and senior level. So, for a site like sixfigures, we actually have a membership so job seekers register and become a member of our site. And we just look at their resume and make sure they're in the right place. These people are highly educated, highly intelligent. They will actually, generally, self-select and will only apply for jobs that they feel they're suitable for.

Dobbie: Yes.
McGowan: So our clients aren't getting hundreds of applications, they're getting a handful of good applicants, which is what our advertisers want. And that's, I guess again, the difference between a generalist site like SEEK, which is just high volume and a site like sixfigures, which is very niche, which is actually for those clients that know what they're looking for.

Dobbie: Because the moment you get down that keyword road ...
McGowan: Yes.

Dobbie: ... then you really are only recruiting people who are good at the recruitment process.
McGowan: Correct. You can get technology to do that. You don't need people to do that. So it just becomes automation, doesn't it?

Dobbie: There's probably a piece of software that'll put 400 applications in for you at a series of companies.
McGowan: There is, there is! There's parsing software, there's matching software, there're all those types of things. Sometimes volume dominates and that's that need to fill the role quickly and just making a key match is the least risky or supposedly the least risky option. It actually does everything but get you the best people, in my opinion, again, when you're looking at that more senior level. Of course, if you're just recruiting a very sort of transactional role, that type of hiring works. But if you are recruiting someone to manage, to lead, to problem solve, to be creative, keyword matching will serve you no purpose.

Dobbie: Now, we've talked a lot about jobs that exist and sometimes you find the right people who, just because they're not looking for a job, but they seem the right person for the organisation and if you're the round peg for the round hole, then I think companies sometimes think, "Well, let's grab this person while we can". The recruitment process doesn't really, as it currently stands, particularly when you're working through agencies, accommodate that sort of approach, does it?
McGowan: No, it doesn't and it's unfortunate. And if you, that sort of iconic book by Jim Collins, From Good to Great, and it's sort of tracking the history of these successful and enduring businesses, those that can actually identify talent, which I think so many businesses, is a big challenge to start off with. They don't know what people and skills they need, let alone what that looks like. So hence, you've got, sometimes, a bit of a random recruitment process happening. But, their philosophy and the philosophies tracking these successful businesses was around, if you can find talent, if it comes to you, find a position for it.

Dobbie: Yes.
McGowan: Because these people will make your business successful and even in today's climate, I don't think any business can afford not to be either retaining or brining on these key people that will be instrumental in turning their businesses around. And I think you're right, businesses, sometimes are a little bit reluctant to take a candidate that a recruiter might float to them if there isn't immediate need. And I think that's to their detriment and I wonder if once things come back with the market, if that's something that they will be a bit more open to. Because inevitably, the talent shortage will continue on, once the market returns.

Dobbie: Does that often happen, though, I mean, are recruiters ever actually doing that? Because the industry is driven a lot by commission, isn't it?
McGowan: Yes it's very reactive, it's unfortunate that the recruitment process is very reactive and that's a real issue as well, which impedes on both recruitment and HR practitioners giving it their best.

Dobbie: Yes.
McGowan: Because we've got a need and we need to fill it really quickly and like it's just sort of plodding holes, really, isn't it? There's no future thinking or long term thinking.

Dobbie: So, does that mean there's a better solution --- just thinking of the advertising industry, for example, where outcomes are very influenced by commission structures.
McGowan: Yes.

Dobbie: And the smart organisations just said oh, look, we're just going to pay your monthly fee. We don't want to pay you any commission. We give you a monthly fee and you provide the expertise. Maybe recruiters should be employed along those lines as well.
McGowan: Sure, I think it's a really good suggestion, looking at other ways and still leveraging those skills and still keeping them incentivised, but delivering that longer-term solution. I think that's a fantastic service that I think that businesses, once they get sort of used to it, would probably start to value. And again, recruiters are in a fortunate position, coming across a lot of good people. I know I've experienced this myself a lot in recruitment --- agency recruitment. You've got these wonderful candidates and you can't do anything with them. You're just like, these people are just fantastic, but there's no immediate need and companies, sometimes, are a bit closed to receiving their applications. It would be good if there was that opportunity because these are, I stand by because I don't care what anyone says, there's an abundance of talent out there. There's never been a talent shortage. There's brilliant people everywhere, we just don't come nicely packaged in a box that can be easily matched these days. I think that's probably the challenge we face as recruiters, that talent comes in all shapes and sizes and forms and it is a difficult job.

Dobbie: Well, I think we've got our answer, Kelly. The answer seems to be, take on a recruiter because they can provide some outside expertise.
McGowan: Correct, yes.

Dobbie: But don't tie them too tightly to jobs, don't just get them to recruit jobs, get them as your talent scouts for your organisation.
McGowan: Consult, let them consult, let them work with you.

Dobbie: I love it, I love it when we can come to answers like that. Kelly, thanks very much for your time today. It's been a pleasure talking to you.
McGowan: Thanks a lot, Phil.