Reaching for the Stars

By Alan Darling

  • Originally published by Multichannel Merchant

Recruiting strategies that capture the best and the brightest employees

Today’s free-for-all, full-employment job marketplace may be a dream come true for employees, but the picture is less rosy for employers. More and more catalog companies are becoming dismayed with the quality of applicants they are getting from newspaper ads, particularly when they need someone with a mail order background. Successful companies are using a variety of techniques to seek out the best and the brightest, rather than waiting for those applicants to come to them.

“I’m not sure there are any easy positions to fill these days,” says Bob Allen, CEO of Vermont Country Store, a $66 million general merchandise cataloger based in Manchester, VT. “But the most difficult positions for us to fill have been in information technology. We have also had a great deal of difficulty filling merchandising positions. I believe that this scarcity of qualified candidates is partly the result of the dot-com companies luring good buyers with incentives such as stock options.”

There are two ponds that companies can fish from to find candidates. The first is easy to reach but has few fish, small fish, and many fishermen. The second pond has many fish, bigger fish, and few fishermen, but it’s more difficult to reach.

The first pond consists of people who are looking for jobs. This includes not only unemployed workers but also, according to research, 8% of all employed executives. Most companies concentrate their recruiting time and effort on these prospects. But these candidates generally turn over at high rates and aren’t of the same quality and caliber as those who are not looking for jobs. Companies usually reach these job seekers through newspaper advertising, the Internet, employment agencies, and other traditional methods.

The second pond has the 92% of employed executives who are not actively looking for jobs – but they could be persuaded to change their minds, given the the right incentives. These are generally the best people out there, and they’re the ones you need to aggressively pursue if you’re going to build a highly effective organization. They are also the most difficult audience to entice with even the best print and Internet advertising campaign, because they’re not even thinking about changing jobs.

Recruiting these passive candidates requires a new mindset – one of going after potential candidates regardless of whether they are on the job market. “Our best recruiting is done word-of-mouth,” says Vermont Country Store’s Allen. “We have a good network. When we’re looking for a buyer, for example, we call our vendors and let them know. Then they’ll suggest qualified candidates. Perhaps half of our positions for buyers and midlevel managers have been filled in that way.”

Recruiting over the long haul

The best recruiting efforts start years before a position is filled. You regularly meet qualified people at conferences and trade shows – make these contacts work for you. Whenever you meet someone who could potentially help your organization, grab his or her card, record any relevant information, and file it. Contact the people in these files at least once a year (plus send a holiday card), and when a job opens up, turn to this file first. You shouldn’t have to beat around the bush with these candidates by the time the situation arises – if you’ve played your cards right, you should know them well enough that you can ask them directly if they’re interested in working for you. If they’re not, ask them if they know any rising stars who would be.

Many firms, particularly the larger ones, now have formal employee referral plans that involve the entire company in the recruitment process. For one of these plans to work, however, it needs to be more than just a good idea on paper; you must actively reinforce it. Use all methods of internal promotion available. For instance, post information about all open positions prominently throughout your company, rather than hiding them away on one wall in the human resources department, and call attention to especially hard-to-find or highly needed positions. What’s more, have the human resources staff and the department managers speak regularly to employees one-on-one about the plan to heighten awareness.

“Whenever anyone walks in to my office, I ask him who he knows,” says Jim Hayek, executive vice president of human resources at Bear Creek Corp., the Medford, OR-based corporate parent of food, plants, and gifts catalogs Harry and David, Jackson & Perkins, and Northwest Express. Bear Creek has an active employee referral program that pays participating employees referral bonuses of $1,000-$3,000. This is clearly the company’s number-one method of recruiting professionals, far exceeding methods such as Internet and print advertising.

Apparel cataloger Lands’ End has a similar formal employee referral plan, in which employees who refer candidates are paid bonuses of $1,000-$2,000. “Internal referrals have been our most effective tool,” says Tom Gloudeman, director of recruitment and development for the Dodgeville, WI-based company. “A third, perhaps even half, of our external hires are identified this way. Our employees know the type of person who will fit in here, so the candidates are better-quality candidates – they tend to be the folks who can hit the ground running. I don’t ask employees who they know who is looking for a job. Instead, it’s far more effective to ask who they know who would be successful here.”

L.L. Bean has a formal employee referral program only for its information technology department, but the Freeport, ME-based cataloger informally taps employees in all departments when people are needed to full positions, says employment manager Bob Schmidt. The company has found creative positions particularly difficult to fill, so when there is an opening, it encourages its art directors to network with ad agencies and other creative operations.

Stealing the superstars

Some companies consider it unethical – or simply too time-consuming – to make cold calls to people they don’t know at their competitors’ offices. But this tactic should be, in fact, one element of a successful recruitment program.

The catalogers we spoke to rarely use this approach, but the technique is common among high-tech firms. You can learn a lesson from high-tech companies, because they recruit in the most competitive job market that exists today: There are 300,000 more software development positions available than there are takers.

If you still aren’t convinced, consider this exceptional (and true) story. A vice president of human resources for a major computer manufacturer set out to hire his company’s first senior training person. After some research, he determined that there was only one man for the job – the senior training manager at IBM. So the HR executive had his secretary confirm that this man would be in his office at IBM on a certain day, flew to New York, and wrangled his way right into his prospect’s office at IBM headquarters. At first, his prospect squawked and threatened to call security. But the HR executive persisted, explaining to the candidate why he was the only person for the job. The pursuit paid off: After several meetings, the prospect accepted.

You can do your own version of this type of search without even leaving your office. If you need a vice president of merchandising, for example, you could start by making a short list of companies who would employ a person with the skills you’re seeking, and then identify the individuals at those companies who are doing that job. This can be done by using directories or by calling the target company and simply asking who is in charge of, in this instance, merchandising. Then make a series of quick phone calls to the most likely candidates; you may be surprised at what develops.

To fill lower-level positions, you can get your own people involved. If you’re looking for a network administrator, once you identify a key prospect, have someone in your information technology department call the person, lead off under the pretense of asking a technical question, and then work the conversation around to his real objective: to find out if the prospect knows someone who would like to come to work for your company (if that person is interested, he or she will suggest himself). Microsoft, by the way, has a department filled with employees making cold calls to competitors all day long, and that’s one way the company gets its superstars.

Surfing for staffers

All the catalogers we contacted are finding that newspaper advertising has become less and less effective for them, and consequently they are investing more of their time on the Internet.

“The Internet is a wonderful tool, but it is time-consuming,” says Bear Creek’s Hayek. “A lot of mining is needed. But it does help us find people whom we wouldn’t find anywhere else. Many people who are not seriously in the job market have posted their resumes on a Website or two because it’s relatively effortless, and you can identify them there.”

In addition to placing Internet ads and using resume databases, Hayek and his staff enter chat rooms on areas of expertise where they are likely to find qualified candidates. For instance, if they are looking for a technical person, they may enter a chat room on software issues and e-mail prospects who post comments there. In fact, Hayek is considering adding an employee to mine the Internet full-time.

L.L. Bean has had some success with Internet recruiting via job boards, particularly for its information technology department. But it has by no means become the cataloger’s primary source for external hiring.

“The Internet has to some degree increased our pool of quality applicants,” Bean’s Schmidt says. “But it also significantly increases our pool of unqualified applicants too and generates a lot of false leads that you have to sort through. It has its place, but it is not nearly as effective as employee referrals.”

Give them the star treatment

Other than outstanding athletes who have been sought after by college coaches, very few people have ever truly been recruited, so a company’s pursuit is likely to pique a prospect’s interest. If the candidate has even a germ of interest, go after him or her with wild abandon. That candidate will then see you and your company as he sees no other – in a class of its own. After the first contact, dazzle the candidate by sending a Priority Mail package filled with information on the company and the area. The cost is minimal (only $3.20), but the impact is huge.

At the interview, impress the candidate. (You can do this at the same time you’re gathering information about the candidate and determining whether he or she will fit in your organization.) The key is to make every candidate leave your office wanting the job. You can decide later whether to offer it to him or her.

After an interview, if you were impressed with the candidate, leave a message saying as much on his or her home voice mail. If the candidate is an out-of-towner, send the local newspaper from where the company is based to his or her home for a month or two. Keep the dialog going, even if you’re considering other candidates. The worst thing you can do is leave the candidate in the dark for weeks. Ultimately, you want to choose the best candidate, rather than hire the only person who’ll take the job. Keep all candidates interested so that you can have a choice.

The old recruitment techniques of running ads and waiting for people to come to you may have been easier, but those days are over. Today you can’t build your business solely with the people who are looking for work – the labor market is just too tight. Besides, companies that focus on pursuing not-in-the-job-market candidates have found the results to be superior. “This type of networking takes more work, and we get a lot more `no’ answers,” says Gloudeman. “But the employees we ultimately generate this way are better, and stay longer.”

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