How To Gain Competitive Advantage From Recruiting
Arindam Chandra
Can you gain competitive advantage from recruiting? The short answer is YES. However, in our experience of more than a decade, we have not encountered "gaining competitive advantage" as one of the strategic goals of many HR and Recruiting leaders.
But those who successfully adopted this goal have really enjoyed rich dividends.
Summary: Here are the key takeaways:
- Recruiting as a competitive advantage is indeed crucial for the success of most organizations.
- Objectively measuring and quantifying recruiting effectiveness are essential to prove its worth.
- Competitive advantage in recruiting means beating industry peers in metrics and performance.
- Such an advantage directly impacts overall business results, revenue growth and profitability.
- Benchmarking recruiting practices of competitors helps identify best practices to stay ahead.
- Establishing a competitive advantage earns credibility and extra support from senior executives.
- Data-driven decisions and continuous improvement are outcomes of quantifying competitive advantage.
- Strong reputation in recruiting attracts high-quality talent across levels as well as top recruiters.
- A competitive mindset requires being comfortable with numbers and obsession with the future.
When a business function (such as marketing or product development or recruiting) produces results that are considerably better than those produced by similar functions in the same industry, they can definitively claim a competitive advantage. And a critical business function with a competitive advantage contributes to an organization's overall business growth. Think about “supply chain” and Walmart or “product development” and Apple or “marketing” and Nike.
Such exceptional outcomes are generally achieved through excellence in innovation, creativity, risk orientation, leadership, processes, technology etc. But to justify claims of a competitive advantage, it is necessary to quantify the metrics, then measure and compare them side-by-side with similar high performing organizations.
Where competition is high, beating the performance of rival organizations has long been a strategic objective for most business and functional Leaders. Because they understand the criticality of gaining a competitive advantage, they devote substantial money, time, and effort to outperform their competitors and bolster their company's fortunes.
Unfortunately, recruiting stands out as an exception to this pursuit of a competitive advantage. Most often, "catching up" or "not falling behind" has been satisfying enough.
WHY? Because many organizations lack the metrics (or lack a defined process) for objectively determining when they have actually achieved a competitive advantage in recruiting. However, it is certainly possible to arrive at a more structured approach to determine when the recruiting function can be genuinely deemed "the best" in the industry.
Comparison Parameters For Determining Your Recruiting Performance:
Here are seven key parameters for comparing your recruiting performance quantitively vis-à-vis your industry competitors. You can assign different weightages to each parameter to reach a total score of 10, as well as further assign weightages to each sub-parameter. Then self-rate yourself as well as at least five competitors on a monthly basis to track your performance.
1. Employer Brand: Measure and compare your employer brand strength against top companies in your industry using publicly available data from company review sites like Glassdoor.
2. Brand Tracking: Track the visibility of your job postings and branded content compared to your talent competitors - monitor frequency, quality, and timing of their posts in social media.
3. Brand Attractiveness: Gather insights into potential candidates through polls to gauge their experience, leadership, diversity, attractiveness, and likelihood of applying to each top firm.
4. Recruiting Methods: Implement 360 degree recruiting strategies using data-driven approaches such as referrals from top performers, head hunting, poaching, passive talent pipeline etc.
5. Candidate Quality: Determine the quality of candidates you attracted by assessing where your "not hired" candidates ended up working using LinkedIn - did they join top-ranked firms?
6. Candidate Preferences: Ask must-hire candidates to list other firms they have applied to - helps identify your direct talent competitors and understand what attracts top talent to them.
7. Talent Gain: Compare the number of employees your organization has hired away from each competitor with the number of employees each competitor has poached away from you.
Benefits of a Recruiting Function which enjoys Competitive Advantage:
Numerous benefits accrue to a business function and its leaders when senior management recognize it as providing a competitive advantage to the organization - the top five benefits are:
1. Improved business results: A strong function leads to a much better overall business performance. Sustaining a competitive advantage proportionately improves results.
2. Attracting and Retaining top talent: A recruiting function with a proven competitive advantage becomes an attractive recurring destination for high-quality talent.
3. Executive Support: Accomplishing a significant advantage gets recognition from senior executives who endorse new ideas and resources. Recruiting leaders become trusted advisors.
4. Better benchmarking: Learning from competitors and understanding top practices provides insights which help talent acquisition leaders proactively try out new approaches.
5. Continuous improvement: When a recruiting function achieves competitive advantage, it is driven to maintain and build upon its success. Striving to stay ahead fosters innovation.
Building a Recruiting Function to gain Competitive Advantage:
Here are ten points to guide you on your journey towards gaining competitive advantage in recruiting - remember to tailor these points to fit your organization's specific recruiting needs and goals as well as regularly review and adjust them to ensure ongoing success in maintaining a competitive advantage:
1. Competitive Spirit: Instil a competitive recruiting mindset so that your ideas and decisions strengthen your organization and weaken your competition. While aggressive approaches such as targeted head-hunting or poaching critical talent can help you get ahead of the pack, do consider the sustainability of your strategy as well.
2. Employer Branding: Invest in building an exciting brand that makes you super attractive to candidates. A unique value proposition and a strong reputation can make your organization a proud destination for prospective employees. This also gives you the benefit of cherry picking the best talent at a reasonable cost.
3. Strategic Partnerships: Depending on your talent needs, establish alliances with academic institutions (such as Engineering and MBA colleges), professional bodies (such as NASSCOM or CII), and industry influencers. Such partnerships can give you easy access and valuable connections to premium talent pools.
4. Data and Analytics: To verify whether you have a competitive advantage, use data extensively to guide you. Quantifiable results tracked using a data-driven approach uncovers key insights and facilitates continuous improvement throughout the recruiting process.
5. Tracking Competitors: To outsmart and overtake your talent rivals, commit to continuous benchmarking of your top industry competitors. Constantly monitoring their plans, actions, and results will give you that edge in your talent acquisition intelligence.
6. Staying Ahead: Instead of blindly imitating competitors and perhaps playing catch-up, anticipate their moves and prepare your strategies by forecasting changes in the talent landscape. Adopting a future-focused perspective can help you stay ahead in the game.
7. Employee Growth and Retention: Retaining existing skilled talent strengthens your workforce and contributes to long-term success. Nurture your employees by giving them ample opportunities for advancement through well-designed career development plans.
8. Diversity and Inclusion: Embrace diversity by actively seeking candidates from different backgrounds. Create an inclusive and equitable environment that values different views and perspectives, enriching your organization and enhancing your competitive position.
9. Technology Adoption: Staying ahead by using technology where it matters reinforces your competitive advantage. Use innovative platforms and automation tools to streamline your recruitment processes, boost efficiency, and deliver an outstanding candidate experience.
10. Be Informed and Adaptable: Be knowledgeable about industry trends, emerging technologies, and market dynamics. This will prepare you to proactively adjust your strategies and enable you to stay ahead of your competition, thus maximizing your chances of success.
The pursuit of competitive advantage in recruiting is not simply a means to an end; it is a must for any organization which wants to thrive in a highly competitive environment. The benefits of such a competitive advantage extend far beyond the recruiting process itself, helping recruiting leaders position their function as a strategic powerhouse.
We have seen this happen; you can do it too.
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