Few things in business life are as crucial as acquiring the right talent for your company. It’s perhaps ironic that in an increasingly technology-driven world, work is more and more a people-centred affair.
Recruitment is a skill like any other, and like all skills it requires training, experience and discernment. It also involves developing a network of contacts and building relationships with talent. Then there are the resources involved in delivering effective recruitment.
There comes a point in your company’s development when you have to decide whether you want to handle the recruitment process in-house or do you want to outsource it to a recruitment agency.
Why hire a recruitment agency?
In many ways, to hire a recruitment agency is an investment in an economy of scale. This has particular relevance if you are a large corporation with lots of roles to fill.
Agencies are highly motivated to provide the best candidates for your company. They are also constantly building and maintaining a resource pool of talent and seeking to match them up with the right companies.
They can also help put your company on the map by effectively selling your brand to potential talent. They become a kind of ambassador for your company. There are benefits to outsourcing this process as it is an effective way to extend your brand’s reach in your sector.
An in-house recruiting team should be expected to perform a similar promotional role.
A large business with many employees, a number of different departments, and multiple offices in different localities are highly likely to turn to a recruitment agency.
For these sort of corporations, recruitment is a full time job that involves a fleet of staff, complex logistics and time-consuming vetting and interviewing processes. It’s often a no-brainer for such a company to turn to a recruitment agency.
That said, the scale of this type of company may well mean they are in a position to be able to assemble an in-house team.
There are no hard and fast rules here, it’s about what works best for your needs.
If you do go down the in-house route, think about whether there’s a need for this team to be established full time. Conditions like a constantly expanding business or industries with a high rate of turnover might necessitate this.
Why recruit internally?
They say if you want a job done properly, do it yourself. Of course, this is not always true, but it may be true for your organization.
It may be easier to convey your brand values when you have control over this process internally as you will have a more direct influence on how your business is presented.
This will depend on how unique or specialist your brand vision is. You may feel that an in-house recruitment team is in a better position to convey the nuances of your brand vision than an external team.
Remember that in today’s economy you have more options open to you than ever before. You have the option of putting together a dedicated in-house recruitment team if your company has a constant recruitment cycle throughout the year.
And you can always use a mixed approach of part internal, part agency, to help you find the right mix.
According to the image below, about 20% of candidates come from external recruiters.
Budgeting
Inevitably, the thorny question of budgeting comes into play when discussing recruitment.
You should make a detailed assessment of your needs, the various options open to you (internal, external or some mix of the two) and the budget implications of these options.
For example, each in-house recruiter should expect to fill around 50 vacancies in a year.
You should also have an idea of how hard or easy to fill each of your vacancies are by assessing your recruiting metrics.
If you are looking for executive talent you may want to draw on the experience and knowledge base of an external recruiter.
Agencies have fingers in many corporate pies and may have the skills to bring fresh leadership talent your way. This can of course also be done in-house.
When assembling an internal team you’ll want to bring in recruiters who have their ears to the ground in your industry and can draw on their networks to deliver results.
If you are a recent startup or have moved into a new sector, you may prefer to outsource this process.
Similarly, if the role is hard to fill, for example, because it requires a very specific or technical skill-base, you may wish to use an agency.
Recruitment needs by sector
Often the sector you are in has a bearing on which recruitment path to take.
In IT, sourcing new talent is harder than in some other industries, driven in no small part by the level of technical skill required by these sorts of jobs and the way the sector has transformed over the last decade or so.
These companies may well turn to external agencies, as in these cases recruitment is a highly specialized process where the many years of experience an agency brings can be highly effective.
Similarly, the accounting and finance sectors are areas where turning to an agency can often make sense. Because it’s an industry with stringent levels of training involved, agencies often have long-standing relationships with professionals and are well placed to push appropriate candidates your way.
Companies with small, dedicated teams, such as ambitious startups, may not want to put out the fees that come with agency recruitment, but don’t have the resources for a full-time in-house team.
In these circumstances, they may have a very lean HR department and their staff may moonlight in recruitment roles as vacancies arise. Alternatively, they may want an external agency on hand when the occasional vacancy needs to be filled.
When making this call you should think about whether your company can afford to take the productivity hit that such moonlighting can cause.
Take a look at the recruiting funnel below from Social Talent to see the manpower involved in making one hire:
The role of recruitment technology
Think through the various stages of the recruitment process, from advertising on job boards, job sites and social media, to shortlisting candidates, and finally interviewing and making offers.
It’s worth mentioning that in a world where automation and advances such as AI technology are on the rise there are lots of ways to streamline the recruiting process.
Increasingly in the world of recruitment, a lot of the skill and graft involved with, for example, parsing lots of job applications, has been captured by AI recruitment tools.
It’s worth as well looking into how AI can make your recruitment processes more efficient. This may well make the difference between handling recruitment internally or externally.
Ian Naylor is the founder and CEO of AppInstitute, one of the world’s leading DIY app builders (over 70,000 apps built). Naylor has founded, grown and sold 4 successful internet and technology companies during the past 18 years around the world.
AppInstitute regularly provides leading publications with app analytics, business data, case studies, white papers and statistics for established publishers across the world. They were named in the top 50 creative companies in England by Creative England.