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Apr
17 2012

The most critical contracting out that you’ll ever do

Syndicated from: Canadian Youth Business Foundation

Terry Thompson, Surrey, BC, CYBF Mentor, tesh@shaw.ca Managing Corporate Culture article series Without a doubt, the most poorly performed function by managers as a whole (including CEOs) is the recruiting and screening of candidates for employment within their companies, particularly for management positions. The vast majority of managers view this function as a major inconvenience – many to the point that they will keep poor to mediocre employees rather than go through the “pain” of having to find someone to replace them. It does not have to be as “painful” as one thinks. In fact, for those who choose to do it properly, their most common reaction after is one of relief and “why didn’t I do it sooner?” because the new employee often makes their life so much better. As mentioned in my last article (Avoid the common mistake in a three-year plan), I chose to use recruiting firms to source candidates and perform the initial screening of candidates. In my experience, the right recruiting firm was worth every penny they charged in the time and effort it saved our company. The key was to find the right recruiting firm for the position being filled. The common mistakes that most people make when choosing a recruiting firm are: Using a contingency firm rather than a non-contingency firm (more commonly referred to as a “retained firm”) because the contingency firm does not get paid until the candidate is hired whereas the retained firm will normally charge 1/3 up-front, 1/3 part way through and 1/3 when the person is hired. Failing to properly perform due diligence when choosing the recruiting firm. Relying entirely on the recruiting firm to complete all of the screening procedures with minimal involvement on the part of the person doing the hiring. I will discuss 1 and 2 above in more detail in this article. The next article will discuss 3. Contingency vs retained firms If you complete the proper due diligence (details below) it should not matter whether the firm is contingency or retained – you expect both types of firms to succeed and so unless there is a material cost difference charged for the same quality of service, it is foolish to choose a contingency firm that does not check out or a retained firm simply because of the method of payment. It has been my experience that, particularly for important management positions, the retained firms offer a more thorough and disciplined process. Due Diligence You should be as diligent in choosing your recruiting firm as you would a new employee. Key items to consider include: Do they have a track record of successful hires in the last 6 to 12 months for the position you are recruiting for supported by references? Be sure to contact references and ask questions to confirm the quality of service and performance of the firm. What procedures do they follow in order to recruit and screen candidates? Consider: Do they take the time to speak with you and others within your organization (if appropriate) to determine the job description, skill set requirements and culture of the organization? Who does the actual recruiting and screening of the candidates and how do they go about it? Is it the person that represents the firm to you or are the duties assigned to a junior person who simply puts an ad in the paper and responds to calls and/or looks at their inventory of candidates without proper consideration of your needs? The good firm will ensure that well-qualified people are doing the work and are also contacting people who are currently employed and may not be actively looking. Effective marketing activities (which will be more comprehensive the more senior the position). Effective screening procedures including interviews and reference checking (again you must review how these are performed). The next article will discuss what your involvement should be in the hiring process. Should have any questions or feedback regarding the content of this article please email me (Terry Thompson) at tesh@shaw.ca. ©

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