Most firms miss the boat when it comes to identifying their recruiting competitors. They assume that their competitors for talent are the same companies that they compete against in the product/service area. But that narrow assumption can be a major mistake. Your talent competitors (TC) are your product and service competitors PLUS the other firms that people you are recruiting consider as desirable employers. It’s important to identify all of them, because, in some cases, talent competitors are completely off your radar screen (particularly when the TC firms are well outside of your industry). Once these competitors are identified, you must take action steps (for example, side-by-side assessments) in order to identify where your firm is superior (or inferior) to your talent competitors. EDS once identified orchestras as a talent competitor. Why? Because they found that music majors could be easily converted to programmers! There are a number of factors that can make your talent competitors different from your product competitors. These include:
- Isolated geography. In small towns or remote areas, all firms within a commuting distance will be competitors for talent because they are the only major employers to choose from.
- Dominant employer. Where there is one large, dominant employer in small towns remote areas, this employer automatically becomes a talent competitor to all other smaller firms because of the scope of job and promotion opportunities?? and often pay, particularly if it is a unionized plant (for example, Hershey Foods in Hershey, Penn.).
- Your firm is the only firm in the area from your industry. If your firm is the only firm in your industry that has a facility in a particular region, then it is likely that none of your product competitors are also talent competitors (especially for jobs without relocation benefits).
- Entry-level and customer service jobs. Companies (especially retail, hospitality and service) with many jobs that require little training, or where firms train new hires, may find that every local firm would be a talent competitor. If your firm has a large number of more sophisticated jobs with a shared skill set that is not unique to your industry (like customer service reps, programmers, accountants) then all firms in the geographic commuting distance are likely to be talent competitors. Starbucks branches for example, compete for talent with all local retail stores…not just coffee shops. Banks may compete directly with manufacturing and high-tech firms for programmers and accountants.
- College hires. Some technical majors, like those in engineering, education, and nursing, accept jobs primarily in a single industry. But other majors, like business, humanities, or MIS may consider all employers equally.
- Remote or “at home” work. For some jobs, geography is less relevant. Firms with a large number of jobs that are remotely located, offer work at home employment, or hire people that work out of a car might compete for talent with all firms with similar job types (for example, writers, web service people, telephone sales, etc.).
- Senior management positions. Competition for senior management jobs is almost always the region, the entire U.S., or even the globe, because relocation is offered. Some senior management jobs are filled from product competitors, while the rest (about two-thirds) are filled internally or from other industries.
- Employers of choice (EOC). If you work at a recognized “employer of choice” (generally defined as firms that are listed on the Fortune or Working Mother best-places-to-work lists) your talent competitors for top talent are likely to be only other “employers of choice.” Competitor EOCs are just as likely to be outside your industry as they are to be in it (partially because many industries have only one EOC).
- When product competitors are your only talent competitors. Direct product competitors are in some cases your only talent competitors. This is especially true for jobs that require industry-specific experience, contacts, or skills. For occupations like dress buyer, the competition may indeed be only other clothes stores or firms. Chip designers, chefs, pilots, and musicians are also examples of jobs that tend to be industry specific.
- Other. People that have recently transferred to jobs in different industries may still be a talent target because they are experienced and could still return to their former industry.
How Do You Find Out Who Your Talent Competitors Are? Once you realize that you have a broader range of talent competitors, your next step is to determine which firms you are up against for each major job category. Here are the some of the steps you should take:
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Guide: Practical Tips for Remote Hiring
- Ask new hires on their first day where else they applied (or considered applying).
- Identify the firms that departed employees go to (your benefits department often knows, or else you can ask in the exit interview).
- Ask current employees what other firms they would consider if they left.
- Ask interviewees what other firms they considered or that have made them offers.
- Ask applicants (ask people on the website or on the application) what other firms they considered.
- Ask recruiters which firms they “share” candidates with at job and career fairs.
- Ask executive search and other recruiting consultants that work for your firm.
- Do focus groups or surveys at trade fairs and seminars, asking, “Who do you consider employers of choice?”
- Do surveys or visit classes at universities and identify who students would consider as potential employers.
- Identify all major employers within commuting distance (the chamber of commerce will have a list by employee population) and compare your recruiting tools and strategies to the largest ones.
- Identify firms that offer remote or distance work opportunities (firms like new ways to work identify them) and see how your approach and jobs compare to theirs.
- Consider tracking the “cookies” of visitors to your jobs website to see where they were before and where they go after.
How To “Beat” Your Newly Identified Talent Competitors Once you identify your talent competitors, you should start gathering information that will help you beat them:
- Develop side-by-side comparison sheets to aid recruiters and managers in selling candidates on your firm’s advantages over competitors.
- Do a competitive analysis and then revise your recruiting tools and strategies until they are superior to each of your talent competitors.
- Consider hiring a recruiter away from your major talent competitor both to weaken them as well as to learn more about their approaches and weaknesses.
- Track the quality (on-the-job performance) of your hires to see if it improves. If so, have a party!
- Ask new hires what your TCs offered and what they saw as the TC firms’ advantages and weaknesses.
- Ask new hires and offer rejects which part of your firm’s pitch was effective and which had no or a negative impact on their decision.
- Compare your website to your talent competitors’ sites to ensure yours is superior. Also be sure to include information and sales pitches that attract people from other industries.
- Track firms on employer-of-choice lists like Fortune’s or Working mother’s (especially EOC firms with major facilities in your region) and see how their job features and brand compare directly to you. A direct product competitor should never rank better than you on any EOC list!
Conclusion Many firms lose the competition for talent because they misidentify the enemy. The consequences of such an error can be deadly. Misidentification of talent competitors can result in improperly designed ads, poor job descriptions and use of sources that just don’t work. Offers that are designed to be superior to your product competitors’ offers will not work against talent competitors that are from different industries! If a great firm like Pepsi recruits only from soft drink companies it may lose talent to beer and water firms and never even know it. The key is to do your research first, narrow down your list of firms and then focus exclusively on the talent competitor firms that top performers also consider (or apply to) when they visit your firm’s website or submit n application to your firm. The war for talent is just like any other war: if you misidentify the enemy, you will lose a lot of battles. I wish you good but selective hunting!