Staffing Firms and Technology in 2012: Challenging Staffing Firms “At Their Own Game?”
I concluded my most recent post, “Staffing Firms and Technology in 2012: ‘Apocalypse Now ‘ or ‘A Time of Transformation’,” with the following assertion about the challenges to be faced by staffing firms addressing the imperative to absorb and adopt new technologies:
I believe the rate of absorption and adoption may be more moderated among corporate enterprise buyers, but necessarily faster and more extensive for staffing firms, due to where staffing firms are positioned in the value chain. As information-driven, “service intermediaries” in a fiercely competitive environment (and where sourcing of candidates/workforce is the essence of the business), I believe that successful adoption of new technology applications will likely be a critical factor of success for staffing firms in the near future. It will also be a major challenge—especially at an organizational and human level.
So the challenge for staffing firms will not only be in selecting, funding, and implementing technologies, but also in managing the organizational and human change that must accompany it.
In today’s post, I’d like to focus on one likely “hot zone” of such change, the convergence of sourcing, technology, social media, “big data,” and the people required to handle it all. Quite realistically, staffing firms may be challenged at their own game to find and secure scarce talent for their own internal use and competitive advantage.
Now I won’t belabor a point that has been asserted time and again in the recent past: due to technology solutions that make it possible and viable, “social recruiting” is on the rise. This is an emerging set of developments in talent acquisition that are based on the creation and integration of technology platforms that support social networks, talent communities, candidate relationship management, et al (you know the buzzwords). What is not always clearly pointed out is the implication of the large amounts of data and information that will come along with these new ways of finding, relating to, and securing talent. For that there is another buzz word: “big data,” or the massive amounts of data that are generated daily by people (talent, candidates) who are present and active on the web, leaving a trail of information (electronic signatures and footprints).
So what are some these implications?
First of all, I believe a greater weight of importance will be put on “sourcing processes and specialists,” who will be charged with the development of talent communities and candidate pools. Recruiters will be as important as ever in engaging candidates, relating to them, and moving them through the many steps of the assessment, selection, and hiring process. But they will do so from a starting foundation of sourced and pre-qualified candidates who have been gathered into talent communities. This gathering and culling of candidates will increasingly be performed through data-intensive sourcing processes (sifting through “big data” for electronic footprints and finding the right patterns of information to identify talent and engage and form relationships with potential candidates).
Second, “sourcing processes and specialists” will become much more data-intensive and data-specialized than they are even today-- and more of them will be required. To perhaps stretch an analogy, in the military there is something referred to as the “tooth-to-tail” ratio (meaning the ratio of front-line combat resources to supporting (often technical) resources). Over past decades of development of military technology, strategy, and tactics, the “tooth-to-tail” ratio has steadily declined, as “tail resources” have grown in proportion to “tooth resources.” I personally believe this analogy will hold for the current and future “war for talent” -- but only time will tell (after all, we are talking about talent and not military targets—right?).
Analogies aside, let’s just hypothetically entertain this scenario and apply it to the internal workforce planning context of staffing firms today, whose core business (it could be argued) is talent acquisition. What will be the skill profiles of future sourcers and recruiters, how many will be needed, and where will they come from or how will they be developed? We are not yet prepared to answer these questions specifically, but we are likely at a point in time where we had better start thinking about it and starting our own workforce planning
To suggest required skill profiles, I’ll lean a bit on two props (which I came across today):
In his recent article, “How to Effectively Source Talent via Social Media & Networks,” Glen Cathey states the following: “Sourcing talent via social media requires an entirely different mindset than sourcing with other forms of human capital data, such as resumes/CV’s, employee directories, conference attendee lists, etc..” What does he mean by that?
I also came across the following job description posted in a LinkedIn staffing group discussion, a job posting for a sourcing/recruiting specialist at Aon Hewitt—no prior talent acquisition experience needed, but…
If you have a good foundational understanding of computer technology, ideally as a result of graduating with a technical degree or working with computer technology in the armed services, and you enjoy working with technology and people, then we should talk. … The job? Think part cyber sleuth, part detective, part technology scientist.
“”Part cyber sleuth, part detective, part technology scientist…. you enjoy working with technology and people, then we should talk.” Very interesting.
How many, with what skill profiles, will be needed? Big question. Where will they come from? Another big question.
Two big questions related to “big data.”
As for the general trend, this recent McKinsey report, Will Big Data Transform Your Industry? succinctly sets the broad context: “As big data changes the game for virtually all industries, it will tilt the playing field, favoring some [firms] over others. The financial and information sectors rank among those with the highest potential to create value in the near term.” The McKinsey report does not specifically point out the staffing industry, but I think we can ask ourselves about whether the “shoe fits.”
As for where the skills will come from… quite coincidentally, Wanted Analytics issued a report today, "Big Data" Brings Big Hiring for Analytical Skills, in which it states (piggybacking on McKinsey):
Companies are collecting more and more information every day – growing by 50% every year and doubling every 2 years. Management firm McKinsey puts the United States on track to face a shortage by 2018 of 140,000 – 190,000 people with much-needed analytical skills, in addition to 1.5 million managers (and analysts) that use these analyses to make daily business decisions. With all this talk about data analysis, we thought we would take a look at job ads that specifically require in-depth analytical skills….. We found more than 18,000 job ads posted online during January 2012 that required data analysis skills – a 35% increase compared to January 2011 and about 75% growth versus the same month in 2010. The volume and growth suggests that many companies are trying to address this hiring trend early and demand is likely to continue.
Fundamental changes are occurring in technology and how businesses are using data and information in their ongoing operations. For the staffing industry, one can perhaps draw some logical connections between several clear data points: (1) the rise of social recruiting based on social networks and other technologies, (2) the associated increase in the data-intensity of recruiting and especially sourcing disciplines, (3) the increasing need for a new mix of sourcing and recruiting skills (including more data analysis and technology skills), and (4) the general trend in the economy toward leveraging big data along with the associated widening skill deficit in this area.
If we connect the dots, we might also conclude the following: the tsunami of technology cresting in 2012 has many implications for staffing firms’ selecting, funding, and implementing of new technology applications. But another equally important implication is in how staffing firms organize and staff themselves. Technology planning and organizational and workforce planning should be regarded as conjoint challenges. The two earlier waves of technology absorption and adoption (Internet/job boards/ATS and VMS) certainly also demonstrated the connection between and the challenges of technology change and organizational/human change. However, this third technology wave may shake the foundations more fundamentally, with a faster rate of change and more challenges in human resource management, workforce planning, and the sourcing and/or development of new “survival skills.”
Ironically, the new wave of technology may also be challenging staffing firms at their own game.