Category HR Tips and Practices

Growing Into Applicant Tracking Systems

An applicant tracking system only works when all parties¡ªapplicants, hiring managers, recruiters and executives¡ªuse the system. Ease of use remains an issue for smaller firms while midsize companies are adding functions to existing systems, and large companies are moving toward full integration of applicant tracking and talent management systems.
By Fay Hansen ——————————————————————————–
asty turnover rates, high recruiting volume, deep cyclical volatility, a difficult mix of low-end and high-end positions, and a heavy emphasis on customer service have always marked the hospitality industry. It’s not a pretty place for recruiters or applicants.

“The problem today is to fill open positions with speed because of the impact on customer service at each property,” says Jonathan Kubo, director of recruiting and relocation for Interstate Hotels & Resorts, a hotel management company with more than 280 properties and 26,000 employees. “Open positions, or positions filled with less than optimal candidates, can have a negative effect.”

With most companies in the industry hiring on an ongoing basis, inefficiencies in the recruiting process generate additional problems.

“For both hourly and nonhourly employees, any delay in hiring caused by an untimely process or compliance issues means that you lose candidates to your competitors,” Kubo says. Constant hiring can burden staff and pump up costs.

Jeff Wade, vice president of human resources at Hersha Hospitality Management in Philadelphia, feels the same pain.

“Recruiting in the hospitality industry is always a challenge because many of the positions are lower-wage jobs, and front-office positions are often filled by college students who want to move on with their careers,” Wade says. “We can find bodies, but it’s difficult to find people with the right attitude toward guests, and it’s hard to train people to be hospitable and guest-focused.”

Kubo reduced the hiring workload at Interstate by installing a customized applicant tracking system that allows direct comparisons of candidates and fully automates compliance monitoring. In an average 30-day period, 3,400 applications come in through Interstate’s ATS and the company closes out 400 positions.

Wade followed the same path at Hersha to meet the company’s growth surge as it expanded from 15 hotels to 54, with a dramatic surge in hiring. Hersha’s new ATS launched on September 1.

But applicant tracking systems only work when all parties¡ªapplicants, hiring managers, recruiters and executives¡ªuse the system. Ease of use remains an issue at smaller firms, which are still in the early phase of ATS adoption. Midsize companies are adding functions to existing systems, while large companies are moving toward the full integration of ATS and broader talent management systems.

ATS initiation
Rapid growth and high turnover in the hospitality industry provide a fertile field for testing quick and effective automation.

Hersha personifies the smaller-company trend toward ATS adoption, while Interstate is following the ATS developmental pattern for midsize firms that are now adding functionalities.

When Wade joined Hersha in April 2006, there was no HR function or recruiting infrastructure. A general manager handled hiring for all hourly positions; a half-dozen outside recruiting agencies filled management positions.

The company signed on 1,000 employees in 2005 with no uniform process for applicant tracking and no systematic practice for interviewing. With 1,000 additional new employees needed for 2006, Wade had to install an HR function, build a recruiting process and hire more than a hundred new employees a month.

Although Wade faced urgent hiring needs, he rejected the idea of outsourcing.

“We have a unique founder-led culture, built on a foundation of taking care of our associates who, in turn, take care of our guests,” he explains. “My fear was that outsourcing providers might look for candidates and pass them on to us too quickly, and not take the time to tell our story effectively. Outsourcing recruiting would be like outsourcing sales.”

Instead, Wade hired HR and recruiting personnel and installed an ATS system, all within a matter of months. He now works with a staff of seven, including a director of talent acquisition.

“The recruiting process is no different from any sales position,” he says. “When I looked for a director of talent management, I did not look for someone with a HR background. I hired a director of sales from a hotel.”

Wade also structured the director’s compensation so that 30 percent of it is contingent on meeting recruiting goals and preset metrics.

“Part of her performance will be measured from the feedback we get from both successful and unsuccessful candidates through our ATS,” he notes.

Hersha surveyed its 3,000 employees, who reported that they searched and applied for employment online, confirming Wade’s sense that the company could automate recruiting for all positions, from hourly associates in hotels to senior leaders at corporate headquarters.

“All candidates want to be able to go online and to be kept in the loop,” he notes. “Automating the system allows recruiters to focus on speaking with the candidates.”

Wade tapped ERC Dataplus Inc. to provide an ATS.

“We began the process in April 2006, signed an agreement in June and had a complete customized system in place by September 1, which is really fast,” Wade notes.

The customized system takes employees all the way from prehire to three-month and six-month reviews to exit interviews and everything in between.

New hires go through an initial hour-long orientation online from anywhere they chose, which speeds up onboarding and gives them a better sense of the company.

“No one, from senior vice presidents to hourly workers, can go on payroll without being in the system,” Wade says. “It’s our first step in moving to a paperless HR function.”

Evolutionary process
Interstate implemented its current ATS in September 2005.

“I like our system because we have the option to post positions on job boards and community organization sites though a one-step process for posting on multiple sites, but then all applications are brought in to a single point,” Kubo reports. “We can track the status of the application and manage online all the data related to selection and interviewing.”

With ATS up and running, Kubo is now considering adding a prehire assessment function that can sort applicants by their probability of success on the job. The function uses prescreening questions for basic information and specific questions designed for each position, and then remove applicants that don’t meet minimal requirements.

Kubo is now meeting with ERC, Interstate’s ATS provider, to determine which assessment tools are most appropriate.

“We want tools that are customized for the industry and the company,” Kubo says. “One of the big advantages is that all the tools will all be incorporated into the system. My role is to evaluate if the assessment tools make sense.”

“Now, we are seeing modifications of the technology at the larger companies, including a significant increase in using validated assessments to get better hires and reduce time and costs,” says Paul L. Rathblott, president and CEO of ERC.

He also reports significant improvement in the integration of other add-on components.

“At one end of the spectrum, you have PeopleSoft HRIS systems, which store a lot data but do not have extensive capabilities or functionalities,” Rathblott notes. “At the other end, you have systems that have a lot of functionalities such as performance assessments.”

The goal is to integrate data storage and functionalities and fold all the components into one process that links all information for new hires and existing employees.

Intuitive systems
“Recruiting technology must be redesigned so that it is as intuitive as Travelocity or Orbitz, which we use as a model for truly intuitive systems,” Rathblott notes. “The point is to have a system that someone can use even if they’ve never used it before.”

Employers commonly underestimate the extent to which applicants are able and willing to use a fully automated system, but ERC and other ATS providers report that the flow of applicants actually increases when companies move to an Internet-only application process.

“The higher flow occurs because candidates are attracted by the flexibility of the Internet,” Rathblott explains. “It allows them to learn more about the company and the job and provides them with a quicker response.”

Access to the ATS is critical for hiring managers, but the system may go unused if it is not intuitive.

“For example, hiring managers cannot use the requisition system in PeopleSoft,” Rathblott says. “They end up filling out a requisition form and faxing it to HR.”

“With the exception of very heavy employee-based industries such as call centers, the typical span of control for a manager is eight to 10 employees, which means that even with very high turnover, the manager will interface with the recruiting technology no more than eight times a year,” Rathblott notes.

An ATS must be designed to accommodate this very infrequent user. The ERC system is supported by a wizard process like Orbitz uses, with a step-by-step process for requisitions and audio support.

“Recruiters may be interfacing with the system on a daily basis, so it must be not only user-friendly but also user-pleasing¡ªpleasant to work on,” Rathblott says. He believes that resistance to ATS adoption in small and midsize companies will disappear as cost and ease of use improve.

At Hersha, Wade is already approaching his goal to cut by half the fees that the company hands over to outside recruiting firms. Time-to-hire for hourly associate positions is now down to five days.

“Salaried positions take 30 days, but we will cut that in half,” Wade says. “You have to get recruiting right.”
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Fay Hansen is a Workforce Management contributing editor based in Cresskill, New Jersey. To comment, e-mail editors@workforce.com.

Employers Using Facebook for Background Checking, Part I

Is it legal?

In preparing to post a Part III on this subject, I decided to revise and re-release this post, which originally appeared at collegerecruiter.com
There has recently been considerable attention in the media to instances of employers rejecting candidates or firing employees based on information obtained from social networking sites such as MySpace and Facebook.

For example, see New York Times: ¡°For Some, Online Persona Undermines a R¨¦sum¨¦,¡± telling this story:

When a small consulting company in Chicago was looking to hire a summer intern this month, the company¡¯s president went online to check on a promising candidate who had just graduated from the University of Illinois.

At Facebook, a popular social networking site, the executive found the candidate¡¯s Web page with this description of his interests: ¡°smokin¡¯ blunts¡± (cigars hollowed out and stuffed with marijuana), shooting people and obsessive sex, all described in vivid slang.

It did not matter that the student was clearly posturing. He was done.

¡°A lot of it makes me think, what kind of judgment does this person have?¡± said the company¡¯s president, Brad Karsh. . .

Today I¡¯ll discuss a question posed by Steven Rothberg of collegerecruiter.com ¡ª prefacing my remarks with a lawyerly disclaimer that I am not providing legal advice and have not thoroughly researched these issues, but am merely making some general comments.

Steven asked that I comment on the lawfulness of making adverse employment decisions on this basis. He raised several concerns: that with Facebook, students often have an incorrect understanding that only other students can access their profiles; that there may be false information on those sites, perhaps not even posted by the individuals themselves; and that Facebook¡¯s terms of service explicitly prohibit users from using Facebook for commercial purposes.

General rule (employment at will)

Let¡¯s start with the proposition that, like it or not, generally employers are free to make unfair, stupid, arbitrary, and wrongheaded hiring and termination decisions, even based on false information, as long as in doing so they do not violate some specific law.

Discrimination Law

One category of specific laws that could be violated by an adverse employment decision based on information on a social networking site is federal and state discrimination law.

It could be evidence of unlawful discrimination if an employer checks for such Internet information on only certain types of applicants or employees, for example, African-Americans and Hispanics.

It may also be evidence of unlawful discrimination if although the employer searches for such information on all applicants or employees, discriminatory bias affects the employer¡¯s evaluation of the information obtained.

For example, an employer may view more negatively photos of an African American male, beer in hand, hanging out at a bar with a hip-hop DJ than photos of a white boy, also with beer in hand, hanging out at a rock ¡®n roll bar with a bunch of other white boys wearing frat T-shirts.

Tell me, was it really the public evidence of drinking that disqualified the individual? How many current employees would be disqualified from employment if never getting publicly intoxicated ¡ª or even drinking in public ¡ª was a job requirement? These are the kinds of questions the EEOC would ask if discrimination was raised.

Sexual orientation might be another touchy area. These days, it may be frankly disclosed on social networking sites without much thought. Yet, sexual-orientation bias remains and might cause some employers to make adverse decisions. In many states and municipalities, sexual orientation discrimination is unlawful, so such decisions will be prohibited.

Invasion of Privacy

Invasion of privacy is a claim that I doubt would fly. It requires a ¡°reasonable expectation of privacy.¡± A student may believe that access to their Facebook profile is limited to a few thousand of their schoolmates and their closest friends. The Facebook FAQs clearly support such a belief in limited access, stating:

Can I see the profiles of people on other networks?

Facebook was intentionally designed to limit the availability of your profile to only your friends and other people on your networks. This simple but important security measure promotes local networking and makes sure that your information is seen by people you want to share it with, and not by people you don¡¯t.

Nonetheless, it would be tough to claim that this expectation of limited access, even if reasonable, is an expectation of ¡°privacy.¡±

On the other hand, if you are using privacy features that you believe allow you to limit access to only invited individuals, as opposed to all others on your network, and an employer somehow hacks past such a privacy barrier, you may have a strong privacy claim.

Terms of Service Violation

Now, onward to the terms of service issue raised by Steve. For sake of brevity, I will only address Facebook. MySpace may present somewhat different issues. The Facebook terms include the following:

You understand that the Service and the Web site are available for your personal, non-commercial use only. You represent, warrant and agree that no materials of any kind submitted through your account will violate or infringe upon the rights of any third party, including copyright, trademark, privacy, publicity or other personal or proprietary rights; or contain libelous, defamatory or otherwise unlawful material.

You further agree not to harvest or collect email addresses or other contact information of Members from the Service or the Web site by electronic or other means for the purposes of sending unsolicited emails or other unsolicited communications. Additionally, you agree not to use automated scripts to collect information from the Service or the Web site or for any other purpose.

You further agree that you may not use the Service or the Web site in any unlawful manner or in any other manner that could damage, disable, overburden or impair Web site. In addition, you agree not to use the Service or the Web site to:

impersonate any person or entity, or falsely state or otherwise misrepresent yourself or your affiliation with any person or entity; . . .
intimidate or harass another;
use or attempt to use another¡¯s account, service or system without authorization from the Company, or create a false identity on the Service or the Web site.

Steven thinks it¡¯s a no-brainer that checking individuals out on Facebook for purposes of employment decisions is a commercial use. This certainly is a possible interpretation, but I believe not the only one.

The next sentence focuses on materials submitted through your account, not what you do with information you learn about others. Therefore, ¡°non-commercial use only¡± could be interpreted as prohibiting only posting information for commercial gain, such as advertisements, not surfing the site for information in support of a business purpose.

The paragraph goes on to specifically prohibit certain methods of obtaining and using information about others. Though it prohibits automated scraping and spamming, it does not address the issue of searching for specific individuals and using the information to make employment decisions.

It seems a stretch to say an employer is ¡°intimidating or harassing¡± the user of Facebook by using Facebook information to make an adverse employment decision, but this certainly could be argued.

A more serious issue would arise if the employer misrepresented their affiliation with a college in order to create an account allowing them to look up certain individuals, or used another¡¯s account to do so. This would appear to be a plain violation of the terms of service.

Consequences of Violation of Terms of Service

Now, let¡¯s assume the employer violated the terms of service. So what? My answer is that this fact may support a tortious interference with business expectancy claim, but probably only if it was a third-party recruiter or investigator who committed a violation. This is because interference by a third party is required. Perhaps such a claim against the individual who obtained the information improperly, not the company, would satisfy this requirement, but that is still somewhat iffy.

Other elements of this type of claim might also be difficult to prove, such as whether the candidate has a reasonable expectancy of employment.

There might also be a federal cause of action under the Federal Computer Fraud And Abuse Act to the extent the recruiter/employer exceeds authorized access (as authorized in the terms of service) in obtaining data from a computer system (the Facebook server).

Other Laws

Another law that could come into play is the Fair Credit Reporting Act. Despite its name, this law has broader application than credit inquiries. It might apply if the Facebook information was obtained by a third party investigator such as a recruiter or background-checking service. It would not prohibit use of the information, but would require disclosure of the fact that such information was the basis for the decision.

Thinking Practically

Those are a few of my well-educated, but still speculative, legal thoughts. Long ago, one of my mentors taught me to always ask not only what the law requires my client to do, but also what the client should do, taking into account extra-legal factors such as business realities, employee morale, employee and public perceptions, etc. Here, in the face of some murky and emerging law, I have some thoughts on what both employers and applicants/employees should do, given this growing trend of employers checking social networking sites.

I would advise applicants/employees to assume that future employers will read everything you post. So when you put something about yourself out there, you can be yourself, but avoid obvious negatives like saying you hate to work or posting sleazy or drunken photos. It may help to ask yourself whether you would want your mother to see your site. Sorry to say, but you may not even want to admit homosexuality or extreme political or religious views.

On a positive note, use your Internet postings, including blogs as well as social networking sites, affirmatively. They can help you build visibility and credibility as an expert in your field (or hobby). Join more ¡°serious¡± networking sites like LinkedIn even if you are still a student ¡ª and work at building a network there that can help you in future job searches.

I would advise employers to cut applicants and employees some slack. You were once young too and maybe did similar things ¡ª if not publicly on the Internet. Ask yourself how relevant the information creating the negative impression is to job performance.

If you are going to do Internet searches and use them as a basis for employment decisions, you better do so consistently, without regard to any legally protected classifications, e.g. race, sex, age. You should document them.

I also agree 100% with Steven¡¯s suggestion to use social networking sites and blogs in a positive fashion in your search to find good candidates. Consider the whole person, of whom the Internet persona is not always a fully accurate reflection.

15 Tips for Writing Winning Resumes

The thought of writing a resume intimidates almost anyone. It’s difficult to know where to start or what to include. It can seem like an insurmountable task. Here are 15 tips to help you not only tackle the task, but also write a winning resume.

Determine your job search objective prior to writing the resume. Once you have determined your objective, you can structure the content of your resume around that objective. Think of your objective as the bull’s-eye to focus your resume on hitting. If you write your resume without having a clear objective in mind, it will likely come across as unfocused to those that read it. Take the time before you start your resume to form a clear objective.

Think of your resume as a marketing tool. Think of yourself as a product, potential employers as your customers, and your resume as a brochure about you. Market yourself through your resume. What are your features and benefits? What makes you unique? Make sure to convey this information in your resume.

Use your resume to obtain an interview, not a job. You don’t need to go into detail about every accomplishment. Strive to be clear and concise. The purpose of your resume is to generate enough interest in you to have an employer contact you for an interview. Use the interview to provide a more detailed explanation of your accomplishments and to land a job offer.

Use bulleted sentences. In the body of your resume, use bullets with short sentences rather than lengthy paragraphs. Resumes are read quickly. This bulleted sentence format makes it easier for someone to quickly scan your resume and still absorb it.

Use action words. Action words cause your resume to pop. To add life to your resume, use bulleted sentences that begin with action words like prepared, developed, monitored, and presented.

Lead with your strengths. Since resumes are typically reviewed in 30 seconds, take the time to determine which bullets most strongly support your job search objective. Put those strong points first where they are more apt to be read.

Play Match Game. Review want ads for positions that interest you. Use the keywords listed in these ads to match them to bullets in your resume. If you have missed any key words, add them to your resume.

Use buzzwords. If there are terms that show your competence in a particular field, use them in your resume. For marketing people, use “competitive analysis.” For accounting types, use “reconciled accounts.”

Accent the positive. Leave off negatives and irrelevant points. If you feel your date of graduation will subject you to age discrimination, leave the date off your resume. If you do some duties in your current job that don’t support your job search objective, leave them off your resume. Focus on the duties that do support your objective. Leave off irrelevant personal information like your height and weight.

Show what you know. Rather than going into depth in one area, use your resume to highlight your breadth of knowledge. Use an interview to provide more detail.

Show who you know. If you have reported to someone important such as a vice president or department manager, say so in your resume. Having reported to someone important causes the reader to infer that you are important.

Construct your resume to read easily. Leave white space. Use a font size no smaller than 10 point. Limit the length of your resume to 1-2 pages. Remember, resumes are reviewed quickly. Help the reader to scan your resume efficiently and effectively.

Have someone else review your resume. Since you are so close to your situation, it can be difficult for you to hit all your high points and clearly convey all your accomplishments. Have someone review your job search objective, your resume, and listings of positions that interest you. Encourage them to ask questions. Their questions can help you to discover items you inadvertently left off your resume. Revise your resume to include these items. Their questions can also point to items on your resume that are confusing to the reader. Clarify your resume based on this input.

Submit your resume to potential employers. Have the courage to submit your resume. Think of it as a game where your odds of winning increase with every resume you submit. You really do increase your odds with every resume you submit. Use a three-tiered approach. Apply for some jobs that appear to be beneath you. Perhaps they will turn out to be more than they appeared to be once you interview for them. Or perhaps once you have your foot in the door you can learn of other opportunities. Apply for jobs that seem to be just at your level. You will get interviews for some of those jobs. See how each job stacks up. Try for some jobs that seem like a stretch. That’s how you grow… by taking risks. Don’t rule yourself out. Trust the process. Good luck in your job search!

What Employers Really Want…

If you’re a job search candidate looking to bestow gifts upon the recruiters of the world, here are seven packages they would love to unwrap this holiday season…

1. Resumes that really fit
If your resume isn’t a fit for the job, don’t send or submit it blindly! Recruiters are rewarded for fit so if your an unclear or unlikely fit, you better have an internal ally who can lobby for you.

2. Candidates that aren’t stalkers
Recruiters don’t mind a call every once in awhile for you to check in on your status or see if they are interested. But when you start to call multiple times a week (or even a day) you’ll get a shoulder colder than Minneapolis this time of year.

3. Perfect grammar and spelling
This time of year everyone in the office is looking for a laugh. So if your cover letter proclaims that “your the won for the job,” don’t be surprised if you never hear from us.

4. Commitment
Slowdowns at the office and sheer boredom may mean you start to send out resumes willy nilly. Please don’t. If you’re not serious about moving on, please don’t waste my time or yours!

5. No more vanity
As the job market starts to get stronger, candidates start to get more cocky. Please don’t focus on what’s in it for you. Instead, focus on telling me what you can do for my company.

6. Make our lives easier
Really understand what we are looking for. If you help us understand why you are the perfect candidate for the job, we can better convince other internal employees of the same thing. Make it easy for us to make your case!

7. Don’t be an online embarrassment
We’re starting to Google you and look at your MySpace and Facebook accounts. Don’t get us all excited that you’re a great candidate for us only to find out your MySpace page is full of activities that would make an employer blush!

And please, no more fruit baskets. We like coffee and chocolate.

Job Description

Effectively developed, job descriptions are communication tools that are significant in your organization’s success. Poorly written job descriptions, on the other hand, add to workplace confusion, hurt communication, and make people feel as if they don’t know what is expected from them.

Job descriptions are written statements that describe the duties, responsibilities, required qualifications, and reporting relationships of a particular job. Job descriptions are based on objective information obtained through job analysis, an understanding of the competencies and skills required to accomplish needed tasks, and the needs of the organization to produce work. Job descriptions clearly identify and spell out the responsibilities of a specific job. Job descriptions also include information about working conditions, tools, equipment used, knowledge and skills needed, and relationships with other positions. Still uncertain about the value of job descriptions? Consider these tips about employee job descriptions.

Job descriptions provide an opportunity to clearly communicate your company direction and where the employee fits inside of the big picture.

Whether you’re a small business or a large, multi-site organization, well-written job descriptions will help you align employee direction. Alignment of the people you employ with your goals, vision, and mission spells success for your organization. As a leader, you assure the interfunctioning of all the different positions and roles needed to get the job done for the customer.

Job descriptions set clear expectations for what you expect from people. According to Ferdinand Fournies in Why Don’t Employees Do What They’re Supposed to Do and What To Do About It,” (see sidebar) this is the first place to look if people aren’t doing what you want them to do. He says you need to make certain that they clearly understand your expectations. This understanding starts with the job description.

Job descriptions help you cover all your legal bases. As an example, for compliance with the Americans With Disabilities Act (ADA), you’ll want to make certain the description of the physical requirements of the job is accurate. Whether you’re recruiting new employees or posting jobs for internal applicants, job descriptions tell the candidate exactly what you want in your selected person.

Clear job descriptions can help you select your preferred candidates and address the issues and questions of those people who were not selected.

Well-written job descriptions help organization employees, who must work with the person hired, understand the boundaries of the person’s responsibilities.

People who have been involved in the hiring process are more likely to support the success of the new employee or promoted co-worker. Developing job descriptions is an easy way to involve people in your organization’s success.

How Do We Get Smarter About Our Recruiting Habits?

How do we get smarter about our recruiting? Our telecommunications company is going through an extended growth spurt. I¡¯d like to challenge management¡¯s thinking regarding whether certain jobs are necessary or merely “nice to have.” Our human resources systems and processes are very limited, we lack formal systems for job evaluation, and we have no job grading or a structured recruiting model. I¡¯m of the belief that a good route to pursue would be to start with verifiable data.

Starting with verifiable data is a great way to get smarter about recruiting, and with your organization¡¯s extended growth spurt, the timing could not be better.

When demand is on the rise, the traditional approach to recruiting is to react with fervor: filling vacancies as quickly as possible at the lowest cost, no questions asked. Companies barely take the time to develop recruiting strategies and plans, let alone try to create an overall plan for the workforce. When it gets busy, they don¡¯t have time for planning, and when it¡¯s not busy they don¡¯t see the need for it. Even when organizations figure out how to make the time, many just don¡¯t do a good job of workforce planning.

With limited HR systems and processes, it may be more challenging to pull together the data, but here is an approach you can take.

First, start with the headcount of your current workforce. You will want as much data as possible on this so you can analyze by different variables such as department, job classification, exempt vs. nonexempt employees or geographical locations. Then, take a toll of your active requisitions and map them to these variables. If you have informal systems or processes and your requisitions arrive on the back of a napkin, instead of through an applicant tracking system, you may need to estimate. The last pieces of data you will need are your historical attrition rates, sorted by the same variables, as well as your average time to fill (again, you may need to estimate).

Based on your average time to fill and your attrition rates, you can now produce a forecast of what the workforce will look like three months to six months out. You can show projected net gains or losses from a departmental view, job classification, geography or any view that is important to the organization. To take this a step further, you could convert any net gains into estimated cost increases and compare this to existing budgets, or analyze any projected losses to determine the impact on operations.

In human resources we have been longing to prove ourselves as business partners. If you arm yourself with this type of data, not only will you be able to challenge management¡¯s thinking on the growth of the workforce, but they will probably also listen to you.

SOURCE: Ed Newman, the Newman Group, Phoenixville, Pennsylvania, December 23, 2005.

How Do We Quantify the Impact of Faulty Hiring?

We¡¯re trying to polish our recruiting efforts after some bad hires. How can we measure the impact, both in dollars and other costs, of poor hiring decisions?

¡ªPenny-pinching Recruiter, government, Dee Why, New South Wales, Australia

Dear Penny-pinching:

Employee turnover is an important tool to use in measuring a company¡¯s success. But let¡¯s be honest: There are different costs associated with “good turnover,” in which underachievers are separated, and “bad turnover,” in which quality performers leave for other opportunities. Therefore the data alone does not tell a whole story. Radical as it may seem, some turnover can be good–even desirable, in some instances.

But let¡¯s start with the basics. There are certain quantifiable costs involved in filling a vacancy, whether it¡¯s caused by good or bad turnover. These costs are composed of employment advertising fees (print or online), recruiter fees (contingency or executive search,) assessment tools and background checks, travel and relocation costs, HR staff time, and new employee orientation and training. Additionally, turnover will have a qualitative impact on productivity, with work being reassigned and new hires needing time to learn their new jobs.

Now let¡¯s take the analysis one step further and distinguish the differences between good and bad turnover. When a valued employee leaves, not only do you incur obvious costs, but the company also loses that employee¡¯s internal corporate knowledge and experience, external client contacts and sources¨Cand it faces the possibility that the employee will use his or her skills to work for a competitor. Alternatively, when a marginal employee leaves, a company has the opportunity either to incur a savings by not filling the job or to recruit an employee that adds more value than the one who has left.

The obvious question from human resources¡¯ perspective is how to avoid bad turnover, rather than how to avoid turnover in general. In order to fight bad turnover, every manager in your company should be trained in employee relations, conflict resolution and the implementation of equitable corporate policies and procedures. An employee-retention program that is geared toward maintaining a positive corporate culture and employee well-being always attracts job applicants. However, discouraging bad turnover requires properly trained managers working with human resource strategists to recognize telltale signs of frustration among employees, especially in areas within their direct control. In the end, it is frontline supervisors who are accountable for employee satisfaction within individual departments. Success means giving those managers the proper tools.

Company Profile: Recruiters Get LinkedIn in Search of Job Candidates

Electronic recruiting leader LinkedIn is actively courting the headhunting set with new services. But new potential competitors are emerging and it remains to be seen whether business-focused networking sites will become central to most recruiters.
By Ed Frauenheim
——————————————————————————–
Recruiter Tim Farrelly starts his day at his computer getting linked in.

That is, his Internet home page is the business networking site LinkedIn, where Farrelly, a San Francisco-based executive recruiter, does such things as seek out and contact job candidates. About 15 times a month, he uses the site¡¯s new “InMail” feature that lets him send a message directly to one of LinkedIn¡¯s more than 7 million members. And 90 percent of the time, he gets a response.

There¡¯s “probably no better place out there to find a passive candidate,” Farrelly says, referring to the job candidates not actively seeking new employment. “It¡¯s really effective.”

Among social and business networking sites, LinkedIn is standing out these days as a tool for recruiters. According to Palo Alto, California-based LinkedIn, the number of recruiters who are registered users of the site has more than doubled in the past year, to more than 100,000. And LinkedIn is actively courting the headhunting set with new services, including the InMail product and job ads targeted to specific types of professionals. Meanwhile, other business networking sites such as ZeroDegrees and Spoke Software have faded or changed course.

Konstantin Guericke, a LinkedIn co-founder and the company¡¯s vice president of marketing, says LinkedIn is leading the way when it comes to a critical part of recruiters¡¯ work.

“I think we are becoming the main site where people are looking for passive candidates,” he says.

But LinkedIn¡¯s quest to be a hub for recruiters may still prove difficult. New potential competitors in the social networking arena are emerging. And it remains to be seen whether LinkedIn or other business-focused networking sites will become central to most recruiters.

Kevin Wheeler, a recruiting industry analyst and president of consulting firm Global Learning Resources, says LinkedIn has managed to attract a significant share of recruiters to its site, and he believes that social networking will become ever-more important to recruiters over time. But, he says, that doesn¡¯t mean LinkedIn is going to command recruiters¡¯ attention–or their dollars.

“We¡¯re all signed up” to the site, he says. “But the real question is not how many recruiters have signed up, but what percentage of recruiters is actually using it for recruiting?”

Recruiting recruiters
Statistics from LinkedIn suggest that a fair amount of recruiting is going on at the site. A LinkedIn survey of its users found that a third had been contacted at some point regarding a job opportunity. And most of the “power users” paying LinkedIn $200 a month for premium services such as InMails are recruiters, Guericke says.

At this point, most recruiters on LinkedIn are using the site for free, Guericke says. He expects that about 10 percent of those recruiters will upgrade to a paid account or post a job on LinkedIn during the next 12 months.

As Guericke sees it, many of the recruiters new to the site are likely to snap up its hiring-related services. As opposed to “networking people” who love the socializing dimension of recruiting, many of the newer members have come to LinkedIn for utilitarian reasons. These business-oriented people appreciate the value of LinkedIn as a database with detailed information and the high response rate the site offers, Guericke says.

“They weren¡¯t the early adopters,” he says.

It¡¯s hard to gauge exactly what percentage of recruiters have profiles on LinkedIn, given imprecise numbers for the profession. A few years ago, industry publication Recruiter Magazine Online estimated there were 200,000 internal, contract and human resources recruiting professionals working full time for corporations throughout North America, as well as more than 100,000 retained and contingency-based recruiters working at some 25,000 firms.

LinkedIn¡¯s attractiveness to this population has a lot to do with not touting its recruiting role to most users. Guericke and four colleagues started LinkedIn three years ago with a vision of making money from professionals such as recruiters, attorneys and management consultants, who could benefit from a network of high-powered people by pitching their services or snaring job candidates.

The average LinkedIn member, however, would come to the site and use it for free to keep track of colleagues, arrange deals and otherwise make business connections. So far, the plan seems to be working.

LinkedIn¡¯s membership doubled in the past year, and revenue at the site is growing at twice the rate of membership growth, Guericke says. The privately held company, which employs about 70 people, became profitable earlier this year.

In the past year or so, LinkedIn has made several improvements designed to help recruiters land passive candidates. Passive candidates typically are preferred over active job seekers, in part for their lower likelihood of job hopping. LinkedIn¡¯s InMail service is designed to speed up recruiters¡¯ pursuit of passive job seekers. After searching the LinkedIn network for people with particular job titles or experience, recruiters used to have to wait for various intermediaries to approve the forwarding of a message about a job opportunity.

Although contacting someone directly amounts to a kind of cold-call, Guericke says recruiters using InMails tend to have a much higher response rate than the 2 percent to 5 percent typical in the sales world.

“Over 60 percent of people you contact respond to you,” he says.

LinkedIn¡¯s 7.5 million members have the ability to block InMails or other sorts of contacts. But just a small fraction of members wall themselves off, Guericke says.

LinkedIn also has a job-posting service that will provide the person posting the ad with a list of 10 people in the network who closely match the ad. In addition, LinkedIn members¡¯ homepages now display job ads designed to fit their skills and experience.

LinkedIn has various levels of premium accounts allowing for InMails and additional introduction requests. The highest level, a “pro” account, costs $200 per month and lets individuals send 50 InMails a month.

Guericke and crew would like nothing better than for more recruiters to follow in Tim Farrelly¡¯s footsteps. Farrelly, president of Coit Staffing, requires all 12 recruiters in his company to use the site. He estimates he spends $7,200 a year on LinkedIn services. But the payback from LinkedIn has been far greater.

“We¡¯ve probably made at least $100,000 because of it,” says Farrelly, who offers both contingency and retained search services and focuses on industries including technology, biotechnology and health care.

Guericke is confident the recruiting business at LinkedIn will expand, though not as fast as revenue overall. He expects LinkedIn¡¯s total revenue to triple or quadruple next year, while revenue from recruiters should about double. Although the recruiting business is important to LinkedIn, recruiters buying premium services account for less than 50 percent of LinkedIn¡¯s overall revenue.

Competitive environment
To a large degree, LinkedIn has outlasted its rivals.

Business networking site ZeroDegrees shut down its service September 30. At one point, the site had more than 1 million members, says Jas Dhillon, who founded the company and sold it to media company IAC/InterActiveCorp in late 2003. Dhillon left IAC/InterActiveCorp about a year ago and has taken a position at Microsoft. LinkedIn has done well, Dhillon says.

“I think they¡¯re in a pretty solid position now,” he says.

IAC/InterActiveCorp, which owns prominent online businesses including Match.com and Evite, did not respond to requests for comment.

Other sites, including Ryze, have lost momentum, says John Zappe, a recruiting analyst with consulting firm Classified Intelligence.

“They¡¯re still around, but they¡¯re a shadow of their former self,” he says.

That¡¯s not to say LinkedIn is a shoe-in for lots of recruiters¡¯ dollars.

Serious questions about the wisdom of spending on business networks were raised in a survey of about 350 recruiters this year by Classified Intelligence and ERE Media, which maintains an online portal devoted to recruiting. The study found that 40 percent of respondents rated business networks as “ineffective” or “very ineffective” in producing hires. Just 24 percent rated them “effective” or “very effective.” National/general job boards and niche professional sites scored higher in terms of their effectiveness than networking/referral sites, according to the survey, which went out to recruiters within organizations as opposed to third-party recruiters.

Networking/referral sites did score higher in effectiveness than executive job boards, diversity sites and regional/general job boards.

The survey made a distinction between business networking sites like LinkedIn and predominantly social networking sites, such as MySpace.com and Facebook. And it found room for growth in that latter category. Nearly 60 percent of respondents had yet to try using social networks, the study concluded.

The report also found that a large majority of respondents spent less than $25,000 last year on social networking sites. But 44 percent of respondents expected to spend more on social network sites this year, while just 6 percent expected to spend less.

Conceivably, some of that new spending could bleed into business networking sites such as LinkedIn. But it¡¯s not clear that employers will invest heavily in LinkedIn or another business-focused networking site, Zappe argues. That has something to do with the fact that compared with traditional recruiting tactics such as print ads, career fairs and even general Internet job boards, business networking sites are new.

“People are somewhat reluctant to say, ¡®Hey, they¡¯re great¡¯ or ¡®They¡¯re awful,¡¯ ” he says.

Consultant Wheeler is convinced networking tools in some form will grow increasingly important, replacing newspaper ads, cold-calling and job boards. “More and more, it¡¯s going to be who you know that gets you the job,” he says.

In any event, LinkedIn faces new or revamped competitors.

Spoke Software, for example, has shifted its business model from social networking alone to a combination of social networking and data about people and companies. That information comes from sources including Web research and the signatures from e-mails sent to Spoke members who in effect “validate” data about people¡¯s job titles and companies, Spoke CEO Frank Vaculin says. Spoke now says it has data on 32 million people, which should aid recruiters seeking passive candidates.

“These are people below C-level,” Vaculin says. “These are the kinds of people you can¡¯t get off the Web.”

Vaculin, who took the reins of the company a year and a half ago, says Spoke¡¯s e-mail validation system offers recruiters more current data on people than LinkedIn does, and he argues that LinkedIn members aren¡¯t exactly passive.

“People publish information about themselves, and in fact become an active candidate,” he says.

As a gauge of LinkedIn members¡¯ “passivity,” Guericke says less than 10 percent visit the site¡¯s job listings. He also says LinkedIn members have uploaded more than 300 million contacts. But he says that because of privacy concerns, LinkedIn doesn¡¯t make that data visible until the contacts themselves have opted in to LinkedIn and created a profile.

It¡¯s also possible social networking players could elbow into the business networking scene. The wildly popular MySpace site says that one of its target audiences is “Business people and co-workers interested in networking.” The U.S. Marines Corps has a MySpace site, with a prominent “Contact a Recruiter” button.

Facebook, the social networking site that until recently was largely geared to college students, also allows people to connect to company networks. Launched in early 2004, Facebook currently has more than 10 million registered users.

Guericke, though, doubts the latest social networking sites will move in on his turf. A key, he says, is the low-key, formal nature of LinkedIn versus the fun-first feel of Facebook and MySpace. Guericke says LinkedIn has consciously avoided photos on the site in part to prevent attractive members from receiving inquiries that have less to do with business than hoped-for pleasure.

“When you mix personal and business networking, business goes right down the tubes,” he says.

Then there¡¯s online recruiting service Jobster. The site, which combines elements of social networking with job posting capability, said in July that it snagged another $18 million in funding from investors. That brings the company¡¯s total capital raised to $48 million since 2004. Jobster said its second-quarter sales doubled from the first quarter, and that it now counts 15 of the Fortune 100 companies as customers.

Dave Lefkow, Jobster¡¯s vice president of professional services, says Jobster helps companies tap into networks of talent through a mix of social networking, permission marketing and customer relationship management tools. Among the products Jobster offers, he says, is software that makes it easy for a firm to ask its employees for the names of the top colleagues they¡¯ve worked with in the past, as well as technology for asking those referrals if they¡¯d like to learn more about the company. Jobster software also is designed to help companies distribute job ads via e-mail–messages that can be forwarded easily to others and tracked by the employer in what Jobster refers to as a “targeted job announcement.”

Lefkow says Jobster and LinkedIn don¡¯t compete directly. But a new focus on consumer use of the Jobster Web site could amount to a challenge to LinkedIn. So far, Jobster hasn¡¯t invested heavily to lure job seekers to its site, Lefkow says. But the firm is on the verge of going after consumers more aggressively. It hopes to persuade more people to create profiles on Jobster.com in part by offering new tools such as “superstar tags” designed to capture a person¡¯s unique qualities better than a r¨¦sum¨¦ can.

“This is going to be a big push for us in the next few quarters,” Lefkow says.

Wheeler portrays Jobster as a major threat to LinkedIn¡¯s recruiting business. Recruiters can use Jobster¡¯s site to post jobs to major job boards, see if candidates have applied to open jobs and conduct searches.

“They want to become the portal for recruiters,” Wheeler says.

Jobster has a better shot of succeeding than LinkedIn does, in part because the site and its services can help employers go after a wider range of employees than the white-collar professionals typically found on LinkedIn. Jobster is “much more versatile,” Wheeler says.

Guericke responds that LinkedIn isn¡¯t concerned with Jobster as a competitor. Its push with job seekers still misses the Holy Grail for recruiters, he says.

“You¡¯re not really attracting the passive candidates, which is what recruiters want, ” Guericke says.

Maybe not. But it could be that neither LinkedIn nor Jobster, nor any other networking site, will emerge as the dominant place for recruiters. As Wheeler sees it, recruiters aren¡¯t likely to put all their eggs in one networking basket. Smart recruiters will use a combination of tools and tactics, such as niche job boards, their own career site, Jobster and LinkedIn.

“All of these networks will have a minor role in the sourcing process,” he says. “There¡¯s no magic bullet.”

Workforce Management Online, November 2006 — Register Now!

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Ed Frauenheim is a Workforce Management staff writer based in San Francisco. E-mail editors@workforce.com to comment.

TYPES OF INTERVIEW

The types of interviews are:

1.Informal Interview.

2.Formal Interview.

3.Planned Interview.

4.Patterned Interview.

5.Non-directive Interview.

6.Depth Interview.

7.Stress Interview

The Twelve Steps of Direct Sourcing

Edge believes it is time to confess to your sins and embrace these Twelve Steps that will lead you to the land of milk, honey, and better candidates…

We admitted we were powerless over our fear of the phone – that newspaper ads, job boards and Internet sourcing had become limited.

Came to believe that Ma Bell – a power greater than ourselves – could provide a steady stream of potential candidates that will invigorate our careers.

Made a decision to turn our will and our lives over to the use of the telephone as we embrace the telephone as a friend.

Made a searching and fearless metric-based inventory of sourcing channels and found these to be full of hot airs.

[You have been weighed, you have been measured, and you have been found wanting. In what world could you possibly beat me? ~Chaucer]

Admitted to ourselves, to our bosses and to each other the exact nature of why we couldn’t get past the use of newspaper ads, job boards, Internet sourcing¡­and Gatekeepers.

We humbly ask to have our fear of the phone eviscerated.

Humbly asked our bosses to pay someone to come in and help us learn the one true path to candidate sourcing.

[She can be reached at 513 899 9628. ASK for Maureen]

Made a list of all the jobs we short-shifted and resolved to use the names we found calling directly into companies to make amends to our past hiring managers or customers.

Made direct amends to hiring managers wherever possible, except when to do so would cause them to berate us for not telephone sourcing in the first place.

Continued to take a career inventory, becoming aware when our past sourcing habits tempted to lead us astray and back into the vaporous confines of newspaper ads, job boards and Internet sourcing – and guarding vigilantly against those temptations.

Sought through telephone and some internet research and reading Sourcers Unleashed (and ASK Maureen on ERE and the Edge) daily, to improve our physical contact with potential candidates and our spiritual contact with telephone sourcing Gurus, invoking our powers to continuously improve and continuing to seek out knowledge on the subject.

Having had this career-changing awakening as the result of all these steps, we try to carry this message to other print and web-bound sourcers who only use newspaper ads, job boards and Internet sourcing, and to practice these principles in all our recruiting decisions.