Lessons from Sourcing Leaders

Sourcing is the buzzword of the current recruiting generation. Large companies are racing to set up central sourcing models. Smaller and mid-sized companies are examining more logical ways to divide labor among the members of their recruiting team. What have other leading companies learned in their own efforts to do this? What’s worked, what’s failed, and what can you do to ensure success? Hunters Hunt, Farmers Farm Two years ago, I wrote an article entitled Recruiting Redefined: The New Recruiting Models. In it, I highlighted several early adopter companies that were starting to redefine how their staffing model operated. The key learning in all of this was that a few progressive companies were realigning their teams, processes, and, in some cases, technologies to focus on passive and less active talent, in recognition of the unique talents and skill sets of individual recruiters. These companies were dedicating resources towards more proactive recruiting and sourcing ó a variation of the hunter/farmer sales model. Hunters would become great at finding, building, and cultivating talent pools, an approach that has given us top guns like Shally Stackerl, Russ Moon, Jim Stroud, and Eric Jaquith. Farmers would lead the selection process and manage customer expectations. The main difference in this model from past models was that hunters (a.k.a. sourcers) ó who in the past had been limited to entry-level Internet researchers ó were elevated to a level at, or in many cases above, the farmers. Since this article, many of the examples I highlighted have failed or drastically changed, while others are succeeding with variations of the same sourcing-centric approaches. Over the last two months, I’ve talked to several staffing directors about what works, doesn’t work and why. Here’s what I’ve learned. EA EA works in an exploding industry, where the talent they seek is almost always passive. Great game designers and developers have no need to look for work; work finds them. This means that the identification of great talent has traditionally been the most time-consuming task for EA’s recruiting team. This is why Cindy Haugh, EA’s senior director of global talent hiring and resourcing, realigned her recruiting staff in a very unique way in order to build stronger talent pipelines. She has structured her team to work in “pods” consisting of front-line recruiters (farmers), very talented sourcers (hunters), and talent coordinators. Each pod works together on similar job functions across the enterprise, which allows them to build expertise, share candidates, leverage relationship networks, and optimize team productivity. It is this functional model that Cindy believes makes the model work effectively; in many companies there is a tendency to align sourcers by business unit. “It’s a lot to ask one person to manage finding, interviewing, assessing, negotiating, and using technology tools with 30 to 40 requisitions. By dividing the labor to play to each individual’s strengths, we’ve seen client satisfaction rise dramatically; time to fill has been reduced because we’re always building pipelines; and we’ve actually started hiring for quality, not just for requisitions when we find top performers,” says Haugh. While the model saves a significant amount per year in agency fees, the key outcome is the identification of quality talent and relationship building for future talent needs. “We’re positioning ourselves to get the right people in the right place at the right time,” Haugh says. Wachovia Wachovia has a central sourcing model, which in itself is not unique ó except that they’ve had one for the last five years! This is sourcing on a massive scale. Wachovia makes over 28,000 hires per year, of which sourcing assists with 2,800 of the professional openings. While it may be surprising to hear this about a bank, Wachovia represents the gold standard in recruiting. In the beginning, the sourcing function was used for very simple searches. Over time, it has grown to become a critical piece of the organization, resulting in more efficient, more effective, faster, and higher quality recruiting efforts company wide. Through a strategic process of trial and error, Wachovia has learned some valuable lessons that can pave the way for other companies considering a move to this model, including:

  • Role clarification between recruiting consultants (farmers) and sourcers (hunters)
  • The use of senior recruiting talent in sourcing roles, versus an internet researcher approach that was used initially
  • Shared accountability and metrics that drive partnerships
  • Change management: Battleships don’t turn on a dime.
  • Continuous improvement: The model is measured and refined every year.
  • Compensation: Sourcers and recruiting consultants are now bonused on shared goals.
  • Specialization

According to Denny Clark, Wachovia’s SVP of staffing, the last point was one of the most critical pieces of the puzzle. In the beginning, sourcers were too broad in their focus and weren’t able to build deep pipelines or expertise in any one area. Ironically, the other critical component of their success has been talent. Denny cites his visionary SVP of Sourcing, Marc Hutto, as the real key to the continual refinement, measurement, and optimization of their sourcing strategies. Today, their model allows for specialized sourcing that allows them to build a true competitive advantage in strategic business areas, while reducing recruiting costs by 20% to 25% for the company. Multiplied over thousands of hires, this is quite significant. Microsoft You may have seen the recent article by Rob McIntosh of Microsoft questioning long-held assumptions on passive candidate recruiting for niche positions. I would also highly suggest that you attend his presentation at ER Expo in San Diego, where he’ll go more in-depth on the metrics and strategies that make a sourcing model successful. Rob’s first advice to companies looking at establishing a central sourcing model is to get on the same page on metrics and accountability. This is challenging in large organizations, where central sourcers don’t own the offer or interview process and can’t easily be directly tied to hires. According to Rob, sourcing is a quality discipline and can be justified by various data points, such as number of phone screens, interviews, offers, interview-to-offer ratios, and post-hire data such as performance and retention. Other advice from Rob includes:

  • Strong communication and expectation setting on the function of the team internally. This can take time.
  • Don’t expect to knock it out of the park on your first pass. Expect to continually revise some of your initial assumptions.
  • There is no cookie-cutter approach that works for every company, especially large ones like Microsoft (which has seven separate P&Ls).

ExcellerateHRO Tracey Friend has learned a lot of hard lessons in her efforts to set up central sourcing models. She now applies these lessons as a product manager for ExcellerateHRO’s Global Recruiting Outsourcing product (a very interesting EDS and TowersPerrin venture). Like Rob, she also suggests that any company examining a central sourcing model look at whether they are trying to recruit for volume or niche positions ó and to look under the surface of position titles that might imply similar skill sets yet actually represent niche positions. She recommends that companies look at talent management more holistically, and says that sourcing is not a magic pill that will solve all of your recruiting challenges. Specifically, she believes that sourcing initiatives will have the most challenges when there are underlying business issues that go unresolved. By looking at recruiting, performance, and attrition together, recruiters and sourcers can act as consultants that help determine whether there are issues that proactive recruiting cannot be expected to solve. There aren’t a lot of solutions or companies that can do this, but Tracey and her team can. Key Lessons First, let’s look at some of the most common obstacles that each of these and other companies have faced as they built sourcing capabilities.

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  • Shared goals, accountability and metrics among the hunters and farmers. It’s important to keep them motivated towards the same goal, otherwise hostility and finger-pointing between the two groups can occur
  • Specialized functional vs. business unit sourcing efforts. Failure to do this is what has made most of the unsuccessful models I’ve seen fall short. It is very important that sourcers can build expertise in one specific (or several complementary) areas with a minimum amount of crossover with other sourcers. It’s very difficult to source for software developers, finance professionals, accountants and interns at the same time.
  • Don’t expect instant success and don’t set unrealistic expectations. This is a model that may need to be measured, improved, and iterated several times before achieving the success that is possible in your organization.
  • Communication with internal teams on responsibilities and desired outcomes is vital.
  • Metrics, metrics, metrics. At times, long-held assumptions need to be challenged using the data you collect (as Rob so aptly points out).

Now let’s look at what rewards many companies have gotten out of their shift to proactive recruiting models:

  • Reduced costs in the form of search fees and advertising expenditures
  • Shortened time-to-fill and time-to-productivity
  • Ready relationship networks and talent pipelines for future openings
  • Increased client satisfaction
  • A huge competitive advantage for top performing, passive talent

While the rewards for central sourcing models can be significant, the challenges to getting there can be equally great. Yet each of the companies highlighted would tell you that the outcomes were absolutely worth the effort. Whether you’re a large or small company, hopefully these lessons can help you overcome your own obstacles to setting up a successful sourcing team. I welcome your comments and experiences! Please post a review below to start the discussion.

Dave Lefkow is currently the CEO of talentspark (www.talentsparkconsulting.com), a consulting firm that helps companies use technology to gain a competitive advantage for talent, and a regular contributor to ERE on human capital, technology, and branding related subjects. He is also an international speaker on human capital trends and best practices, having spoken in countries as close as Canada and as far away as Malaysia and Australia. His consulting work has spanned a wide variety of industries and recruiting challenges with companies like Starbucks, Boeing, HP, Microsoft, Expedia, Washington Mutual, Nike and Swedish Medical Center.

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