Following the departure of master sourcer Shally Steckerl, the recruitment services company Arbita has closed its sourcing unit, laying off its employees, and may dispose of its job-posting business as well.
Don Ramer, CEO and founder of Arbita, said three employees were laid off Friday. One or two independent sourcers will close out the remaining projects, but by the end of the year Arbita will be out of the sourcing business.
The future of the OnePost job distribution service, is also “in flux,” Ramer said. The service distributes employer job postings to multiple job boards, tracking responses to provide source analytics. What exactly is to become of OnePost isn’t clear, though Ramer said he might “spin off” the posting business. However, he was adamant that its future will not include him in any kind of leadership role.
Ramer says the company has been “financially stressed and challenged since Q1 2010.” Responding to reports of delayed paychecks, missed reimbursements, and deferred payments to vendors, Ramer said, “Like many small businesses we have had to be open about cash flow with our employees and flexible in timing disbursements. During the last three years we have paid or earned out the bulk of the company’s debt to our job board partners.”
With the sourcing business closed and the future of the job posting service uncertain, Ramer said he will be sorting through the options for the company and its seven remaining employees.
He said he is looking toward some form of “high-level consultancy” in which Arbita would work with senior-level corporate executives in a strategic talent acquisition and management role.
“We see opportunities at a more senior level,” Ramer said during a phone conversation Monday. The next several weeks will be spent “researching what to do next,” he said, “for the company and the brand in a calmer time.”
The last two weeks have been anything but calm. The sourcing community in particular has been buzzing about Steckerl’s decision to leave Arbita. Several messages about the company’s financial issues have been making the rounds by email and on Twitter.
Ramer referred to the “angry mob mentality I’ve been seeing on social media,” denying the company is folding and refuting suggestions he would “cynically go on vacation and decide to terminate a bunch of people.” Ramer spent part of this month in New Zealand. During the conversation he characterized himself as being “on the defense.” He also had some cryptic tweets over the weekend.
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Steckerl himself has said little publicly about his decision to leave Arbita, where he had been executive vice president and head of the sourcing and training group. Steckerl merged his Job Machine training and sourcing consultancy with Arbita in May 2008.
A year later, Ramer credited the merger with helping Arbita grow by more than 600 percent. Many of the new customers were users of OnePost. However, Ramer said the new training unit — Arbita Consulting and Education Services — headed by Glenn Gutmacher was a strong contributor to the company’s growth.
“The JobMachine acquisition connected us with tens of thousands of recruiting professionals who have purchased workshops, consulting, professional development, or other products developed by Shally Steckerl and Glenn Gutmacher,” Ramer told HRrchitect. Gutmacher left Arbita at the beginning of this year.
However, during our phone conversation Ramer said the sourcing unit hasn’t been profitable for some time and that he has been considering its closure for months.
Steckerl refuted that claim, asserting sourcing and training were a significant source of the company’s revenue. Beyond that, however, Steckerl declined to comment publicly.
Since leaving Arbita two weeks ago, Steckerl has removed mention of the company from his LinkedIn profile. His Twitter account has been made private; you need permission to view his tweets. Steckerl said financial issues fueled his decision to resume his career as an independent cyber-sleuth and sourcing trainer. “I have to pay my bills and provide food for my children,” he said.
Shocking – my first reaction!!!
@Shally is the guest on The Recruiting Animal Show tomorrow at NOON EST – but we are only talking about sourcing
If you have a search and wonder how @Shally wd handle it let me know via recruitinganimal@gmail.com or @animal
Hmmm. One of the things I’ve maintained for quite awhile is that most sourcing can be accomplished by $6.25/hr virtual folks (or more recently thanks to Glen Cathey- $0.11/hr automated resume sourcing aggregators). Also per: Gerry Grispin’s annual report, only 5% of large corporate responding companies’ hires were from direct sourcing. That being said, I’ve also maintained that if you CAN’T get what you need from the low-cost resources, you should go to the Shally’s etc for their $40+/name services. While we don’t know the whole story with Arbita, ISTM that there just isn’t enough of this world-class work needed to go around.
kh
I find this statement particularly interesting:
“Like many small businesses we have had to be open about cash flow with our employees and flexible in timing disbursements.”
If this is the response to being asked about not paying employees (which has been alleged) what does this really mean?
If, as Mr. Ramer states: ” Ramer said the sourcing unit hasn’t been profitable for some time and that he has been considering its closure for months.” – Why did he promote one of his sourcing managers to a Director of Sourcing Solutions less approximately one month ago stating to that manager that it was due to their growing the business and filling hard to fill positions that they were receiving the promotion?”
This type of a situation is never good news.
On the other hand let me say that Mr. Ramer is a man of great insight and intelligence with a penchant towards innovation and positive thought.
I am a fan, have always been a fan and will continue to be a fan of Don Ramer.
Don, if I can help in any way, call me anytime. If I can fit into your plans, feel free to let me know. I wish you all a good holiday season.
You’re right Howard. Don really poured his heart into things and I wish him a quick bounce back up.
Howard, I am confused what specific innovation are you referring to that, prior to Shally existed – and since Shally ‘joined’ – what Don independently fostered?
It’s a far question and I look forward to an unambiguous response. My understanding, which can be easily validated – is that their only marketable product prior was OnePost – however Hanu Software, Haswell, and other vendors tried (and to date have not been paid or are owed considerable compensation by Don) and were unable to fix the technology and replied in kind that it was not up to par – I can also list clients who fired arbita due to this fact. Just being factual.If you want me to list such companies I can do so easily.
Because you hear and like the high level proclaimations of someone does not mean they innovated personally or that they practice what they preach. A fair assessment I would think
Keith is totally right here. I’m amazed that the “sourcing community” is in denial about the future here. The only question will be how far the degradation of recruiting as a whole occurs over time as technology and the international scene continues to grow.
Thanks, Rich. I appreciate it. I wouldn’t call the process of recruiting and sourcing automation and offshoring “degradation,” though. It’s a common process in many areas. Also, I can fully sympathize with the folks that try to deny/refute my claims: who wants to give up a good thing (basic sourcing for decent money) for something unknown that may be harder to do?
Happy Friday