The Best Practices of the Most Aggressive Recruiting Department, Part 2

A few weeks ago, in Part 1 of this article series, I took a closer look at the recruiting function at a bank called FirstMerit, based in Akron, Ohio. The FirstMerit recruiting strategy is one of the most aggressive and effective I have seen in a long, long time. Here, in Part 2 of the FirstMerit case study, are some of the company’s best practices, metrics used, future plans, and results: Structural Elements in the Recruiting Function

  1. Internal executive search. The team developed an internal executive search capability to identify, recruit, interview, and assist in the selection of executives, senior management, and other key management positions. The resulting effort saved hundreds of thousands of dollars and produced hires faster ó and who perform better ó than the previous external executive recruiting process.
  2. Forecasting and workforce planning. The team developed talent acquisition forecasting and workforce planning models to identify hiring needs as much as six months in advance. The system includes an alert when an existing employee is put on a progressive discipline program. The premise here is that this is an indicator of a potential upcoming vacancy. The team also projects hiring growth (from projected new branch opening and expansion) during the October budget cycle. Tying the recruiting plan to the financial budget gives them a minimum of two months “heads up” for next year’s demand. The workforce planning process also includes using data mining and analysis of past openings to estimate how many and where positions are likely to open up.
  3. Service level agreements. The team designed and implemented written service level agreements between the recruiting function and hiring managers (a service level agreement is a written document where both sides agree to act appropriately and to perform at a certain level). The goals of the SLAs are to clarify needs and improve service to internal and external clients and candidates. The SLA is also designed to improve time to fill, to reduce cost per hire, and to improve the recruiting effectiveness and efficiency ratios. It includes promises of fast and responsive service from both parties: for example, recruiters agreed to return every call within 24 hours, make an offer to a candidate within two hours of a manager’s decision notification, and to update managers on every search at least twice a week. Requisitions for bank tellers have a contracted time to fill of 21 days. Managers commit to making decisions on candidates within 48 hours.
  4. Prioritized mission-critical positions. So that recruiting could focus its time and resources on the most critical positions, the talent team worked with management to identify each of the “mission critical” positions in the organization. The team found and then prioritized these positions (18 customer-facing and revenue-generating positions), which it turned out, comprised a small fraction of all hiring but impacted nearly 75% of the revenue.
  5. Competency model for recruiters. The team developed an extensive competency model for recruiters and then restructured the recruiting team to include primary individuals with sales and external search experience. Specific recruiter competencies that they identified include persuasiveness, decision making, spoken communications skills, active listening (parroting), energy, passion, and basic sales competency.
  6. Developing recruiters. The director practices silent monitoring of recruiters (with their knowledge) when they make cold calls. After the call, he coaches them and helps to develop their technique. He also offers half-day clinics, one-on-one role playing exercises with recruiters on such topics as “getting around gatekeepers without ruses or lies” and “overcoming common top candidates’ objections, like ‘I’m happy here.'” The recruiting director also developed, taught, and coached passive candidate sourcing strategies to all recruiters, including advanced topics like center-of-influence development, candidate and talent relationship management, and other cutting-edge recruiting techniques.
  7. Implementing a behavioral interviewing for managers. Although behavioral interviewing is common in many organizations, it was not a widespread practice among managers at FirstMerit. In order to improve assessment accuracy and to reduce interview bias, the team built and implemented a behavioral interview and selection process that was designed specifically to improve the recruiting success in the critical customer-facing and revenue-generating positions.
  8. Aligned recruiting with the business processes. The team established a company-wide process to align recruiting processes (identification, acquisition, interview and selection process) with critical corporate business processes. Recruiting processes were aligned with the corporate culture, management needs, business forecasting models, and regional and corporate-wide business initiatives. An example of their approach occurred when the corporate banking division was assigned some large loan goals for 2005. “The need was to add additional commercial and small business bankers to the team to put more relationship managers and business developers on the street,” said Michael Homula, FirstMerit’s talent acquisition director. Starting in spring of 2004, the talent acquisition team began an aggressive campaign to lure commercial and small business banking talent away from competitors. The result of that effort is that the bank is well ahead of its commercial plan goals for 2005.
  9. Sales research. The team developed strategies and approaches to systematically gather what is essentially market research or sales research information about each candidate. They focus on gathering information that is critical to making a sale, including what criteria the candidate will use to make a decision, what would motivate them to make a change, and who will influence their decision to accept another job. (Note: I have found that systematically finding out a candidates decision criteria is actually quite rare in the corporate world).
  10. Pre-need hiring. The team developed and implemented a “Teller Pre-Posting” program to meet management’s request for more efficient and expeditious redeployments and internal transfers. The program approaches current tellers and pre-identifies which branches in the corporation they are interested in working at. Recruiting houses the information centrally, and whenever an opening occurs in a branch, they deliver, in less than 24 hours, a list of pre-qualified candidates for the manager to select from. The program is based on the “evergreen job” strategy, where you continually search for candidates in critical jobs, independent of whether there is a current opening. The net result is a short vacancy time because or the prior work done by recruiting to develop a pre-qualified applicant “pool” that has already expressed their desire to work at this facility.
  11. Email a friend. Like many corporate recruiting websites, the FirstMerit site allows people that are looking for a job to forward any job to a friend that the user thinks they might be interested in. The system stores the recipient’s name and contact information, giving recruiters the capability to follow up if the “friend” doesn’t respond to the referral.
  12. Recruiter rewards. Rewarding recruiters for excellent results is an essential element for great recruiting. At FirstMerit, the director designed an internal recruiter incentive plan to provide recruiters with incentives and recognition for improving time to fill, efficiency, conversion rates, service levels, and sourcing. The final elements of the plan will be in place by January 2006.

Metrics and Assessment

  1. Presenting to the shareholders. The recruiting team was so effective in convincing the CEO of the business value of great recruiting that he invited the director of talent acquisition to present the firm’s recruiting strategy in front of the shareholders at the annual shareholders meeting. By any standard, this was a landmark event in recruiting.
  2. Quality of hire metrics. The team designed and implemented quality-of-hire metrics to measure (and improve) the on-the-job performance of new hires. (On-the-job performance is determined at the end of the first year and is based on new-hire performance appraisal scores).
  3. Recruiter scorecard. The team designed talent acquisition assessment metrics that included a recruiter scorecard to assess the performance of and to serve as an improvement tool for their recruiters. Included in the scorecard are KPIs like actual vs. contracted time to fill, recruiter efficiency, the number of direct sourcing and hiring goals met, service quality, and prospect/candidate/new hire conversion rates.
  4. Assessing candidates for recruiter positions. As part of the assessment process before recruiters are hired, FirstMerit gives candidates for recruiting positions an actual assignment to identify the names of six good tellers and to select the two best from that list. The results of this real-life simulation are used both to fill actual teller positions as well as to assess how good the recruiter really is. Recruiter applicants are also provided with an extensive reading list on world-class recruiting practices and are asked to provide a written checklist of what they consider to be world-class recruiting practices after having read the articles. That checklist is used both to generate interview questions for them and to assess their grasp of the requirements and understanding of world-class recruiting.
  5. Business case in dollars. The director worked with the CFO’s office and studied how accountants at FirstMerit measured success to determine what measures would get the attention of senior managers and C-level executives. The team then developed and rolled out a model for demonstrating the business impacts (in dollars) that great recruiting had on a manager’s business results. In one example, the team showed the manager of commercial lending that the average revenue loss of not having a commercial lending officer in place (i.e. having a position vacancy) was $5,000 per day (the revenue generated each day by an “average” commercial lending officer). Two years ago, each one of those positions was vacant for an average of 76 days. The manager was then asked how he would feel if, with their help, recruiting could shrink that time down to only 40 days ó because that would mean an increase in their division’s revenue this year (from just this one position) of $180,000. The results from this approach were vastly superior to the old approach, where the team only presented “raw recruiting metrics” to managers. By translating a standard recruiting metric (i.e. time to fill) into dollars, the team learned an important lesson: It’s the money that gets a manager’s attention. The team routinely found that, after presenting examples like this, it was not unusual for managers to be salivating about how to improve recruiting. At least at FirstMerit, they found out that if you put money in front of bankers, they listen. Incidentally, their business case has been so powerful that they have received funding that allows them to keep their recruiter workload remarkably low.
  6. Focus on top performers for the dollars. Each of FirstMerit’s recruiting approaches and tools are focused on currently employed top performers, who are without question, the most difficult people to recruit. They focus on those individuals because they have conducted a similar “business case” analysis on the economic value of hiring a top performer. They demonstrate the value of top performers through what they call the “performance standard deviation,” which is simply the difference in performance between an average person and a top performer in the same position. They have found that, for example, the average personal banker generates 13% more revenue than a bottom performing personal banker. A high performing personal banker generates 49% more revenue than the average. Since few top performers in banking receive anywhere near 49% more in pay than the average, focusing on top performers makes excellent business sense.

Improving the Candidate Relationship

  1. Candidate bill of rights. As part of their continual effort to improve the candidate experience, the team developed a candidate bill of rights. The goal was to establish a higher set of “standards of treatment” that applicants and a candidates could expect from the talent acquisition team.
  2. “$25 with your rejection.” Another attention-getting program that they have is their “regrets” program. Under this program, candidates that they have rejected are given a $25 gift certificate if they open an account. Again, this is a brilliant strategy because it softens the blow to the rejected candidate ó but it has the added benefit of turning “regrets” into possible customers. FirstMerit realizes that all candidates are either current or potential customers, and if you treat these candidates poorly, there can be a significant economic downside, while if you treat them right, there might even be a positive economic result.
  3. Reward for interviewing. In yet another attempt to improve the candidate experience, FirstMerit is now giving free movie tickets to all candidate who interview in order to thank them for their time.

Results That Their Approach Has Produced Having unique practices isn’t enough in recruiting; those practices must give you a competitive advantage, produce significant business results, and a generate a positive ROI. Some of the results that have not been covered under the best practice section above:

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  • The newly developed Talent acquisition model was projected to be profitable in 24 months, but that goal was actually reached in 13.
  • They reduced their exempt time to fill by 18 days.
  • They reduced their cost per hire by 51%.
  • They improved their recruiter efficiency ratio from 15.5% to 9.6%.
  • They reduced their search firm fees by 78.3%.
  • They improved their quality of hire (average performance rating increased by 1.2 points).
  • They reached a 56% employee referral hiring rate with no bonus payouts.
  • They improved client hiring manager satisfaction.
  • They were labeled as the number one benchmark firm in recruiting and talent management.
  • Their “takeaway” (poaching) to “giveaway” (losing to the same competitor) ratio results are staggering. In 2004: 107 takeaways to only 51 giveaways. In 2005 YTD: 58 takeaway and only 29 giveaways.

Weaknesses That Still Need To Be Addressed at FirstMerit Although they do many excellent things at FirstMerit, there is always room for improvement. After completing my research and looking at my model for world-class recruiting, I identified some areas where the FirstMerit could use some significant improvement. They include:

  • They still have a mediocre website that sends a message that is inconsistent with the actual excitement of working there. The website needs to add some “answer guy” features to attract banking professionals who are NOT currently looking for jobs but are interested in doing their current job better.
  • They have a mediocre employment brand development strategy effort outside of Ohio. They need to broaden the brand’s reach so that they can attract the best from around the U.S. and the world.
  • Their managers need to be measured and rewarded for great hiring, development, and retention. Those results need to be distributed to increase competition to be the best in hiring and retention.
  • There needs to be some additional quantification of the dollar impact of great recruiting, development, and retention to further convince managers to invest time and effort into recruiting and talent management.
  • As their notoriety grows, they will become a prime poaching target for firms both within and outside of banking. As a result, they need to develop a first class retention effort that targets their best and most attractive employees.
  • Some online assessment capabilities need to be added both to improve candidate assessment and to reduce the amount of recruiter and management time that is currently spent on assessment.
  • An online candidate feedback and interview scheduling website needs to be developed to improve the candidate experience, to speed up hiring, and to save administrative costs.
  • They need to develop a system to proactively identify internal talent that is misaligned and to move it to areas where it will have a higher return.
  • Their talent acquisition strategy needs to be broadened into a broader talent management strategy.
  • The director needs to continually innovate and add to his team’s toolkit of approaches from the long repertoire that he has used successfully before joining FirstMerit. For example, an innovative approach he once used should be tried, where he set up a “free hotdog stand” with a large banner offering free hot dogs immediately outside and in easy view of a target firm’s office building. The goal was to draw out employees and to eventually recruit them. As others catch up, FirstMerit must continue to innovate.

Outrageous Quotes From FirstMerit Here are some additional outrageous quotes from my interviews and research at FirstMerit:

  • “In general, most of the corporate recruiting world is quite awful.”
  • “If you talk enough about what you do in a passionate way, it will weigh on people and convince them to follow.”
  • “We steal other bank’s customers all the time, why can’t we take their best talent also.”
  • “I once cut off my recruiter’s Internet connections and budget for newspaper advertising just to shock them into realizing the value of personal contact and relationship recruiting.”

Conclusion In a field full of mediocrity and “can’t do” attitudes, somehow FirstMerit’s talent acquisition team has found a way to take risks, innovate, and to provide their firm with a competitive advantage. As the war for talent intensifies in the next six months, the rewards for their innovation will be even greater. My final key learning from this case study is that this degree of boldness would never be tolerated at 99% of firms. So I can only credit the CEO, the senior leadership team, and their VP of HR for leading and supporting this award winning and amazing effort. My hat is off to each of you! Note: This case study research was conducted between February and July of 2005 by Dr. John Sullivan and his staff members at DJS Associates. There is no business relationship between any of the parties.

Dr. John Sullivan, professor, author, corporate speaker, and advisor, is an internationally known HR thought-leader from the Silicon Valley who specializes in providing bold and high-business-impact talent management solutions.

He’s a prolific author with over 900 articles and 10 books covering all areas of talent management. He has written over a dozen white papers, conducted over 50 webinars, dozens of workshops, and he has been featured in over 35 videos. He is an engaging corporate speaker who has excited audiences at over 300 corporations/ organizations in 30 countries on all six continents. His ideas have appeared in every major business source including the Wall Street Journal, Fortune, BusinessWeek, Fast Company, CFO, Inc., NY Times, SmartMoney, USA Today, HBR, and the Financial Times. In addition, he writes for the WSJ Experts column. He has been interviewed on CNN and the CBS and ABC nightly news, NPR, as well many local TV and radio outlets. Fast Company called him the "Michael Jordan of Hiring," called him “the father of HR metrics,” and SHRM called him “One of the industry's most respected strategists." He was selected among HR’s “Top 10 Leading Thinkers” and he was ranked No. 8 among the top 25 online influencers in talent management. He served as the Chief Talent Officer of Agilent Technologies, the HP spinoff with 43,000 employees, and he was the CEO of the Business Development Center, a minority business consulting firm in Bakersfield, California. He is currently a Professor of Management at San Francisco State (1982 – present). His articles can be found all over the Internet and on his popular website and on He lives in Pacifica, California.



51 Comments on “The Best Practices of the Most Aggressive Recruiting Department, Part 2

  1. Interesting follow up, I’ll be surprised if there are many ethics objections, at least to part 2. But what do I know?

    I’ve got a few pointed comments and burning questions. First, I can see the Merits (lol) of the model in retail where a recruiter can walk in the door of any competitive retail establishment or induce a competitor’s low-paid employees with free food (you gotta meet people some how). Recruiters who have to think on their seat behind a phone, across time zones and who have to gain access behind secure doors and work a process where they never meet candidates or clients, well that is an entirely different matter (my opinion). To make an apples-to-apples comparison of successful recruiting strategies and metrics the model would have to do just that, while also comparing the recruiting volume requirements as well.

    I love the approach to coaching, training, business process alignment, research and planning—makes a lot of sense (good organizations do these things in every department). As for compensation, Jan. ’06 seems like an awfully long time to design and implement a competitive compensation plan. How do they justify this kind of wait, to competitive “A” Types in the interim (not trust me, I hope). Or will it be retroactive?

    As for the metrics used to sell the concept to top management, ANY TPR worth their salt does this as a matter of course to justify their “outrageously high” fees. I suspect that all things being equal, the time-to-fill (working with well trained hiring managers along with receptive bean counters and forward thinking senior executives), could, with a good TPR have the same or probably better performance (presuming they engaged TPR’S that truly specialize).

    In terms of interviewing efficiency and effectiveness, did you quantify or qualify the impact on the previous TPR model relative to the lack of internal interviewing competence in that previous model? If not, it’s an apples-to-oranges comparison. More over, good behavioral interviewing isn’t something that is picked up over night. Senior recruiters (if they weren’t order takers) will pick it up faster than less experienced people. Moreover, some department managers will never get it—no matter how much training—so as long as the impact of the ones that can’t do it is neutralized, it makes sense.

    For argument sake, could it be that the “previous external executive recruiting process” was not as well managed as the new-and-improved internal one (seems to be the case). Did the previous TPR process include good budget forecasting and SLA’s? Can this experiment really be compared to a truly scientific controlled study? I question the notion because…how can you assess the real dollar savings or economic impact if the new model wasn’t compared against the execution of an effective TPR strategy, versus one that was broken. There’s a lot of room for dialog on this comparative issue of models. One is that an internal staff comes at a high price and the model may not be as cost effective for a firm that needs only the occasional external search for a highly trained and hard to find professional where talent supply is limited, especially as compared to the retail environment of a bank. Just a thought.

    And in terms of justifying the investment into a high-end internal recruiting function to acquire these “18 customer-facing and revenue-generating positions” was a comparison made as to what a good TPR strategy would have cost? Staffing an entire recruiting department isn’t cheap? I’ll admit that I don’t know much about staffing and compensation in the banking industry, but someone out there does. So excusing my ignorance and limited desire to research compensation for banking revenue generating positions, I’ll make a simple assumption that the average fee for these type of searches would be about $30k per or just over a half million. If the annual department burden (comp/benefits/expenses/office space/equipment, software, other services like doing backgrounds and references, etc.) is near that—then ok. But if not…?

    As for comparing the previous model to the new one, how many top performing candidates from the previous model were presented by a good recruiter who didn’t accept a position (because FirstMerit didn’t get it) but might well have accepted under the new paradigm and saved FirstMerit that $5k/mo? And how many truly top candidates were never contacted by a good TPR because they new it wouldn’t happen (the differential wasn’t there to offer).

    I challenge the model and/or the people to engage in recruiting Private Military Contractors (PCM’s) from Columbia to go to Iraq? A hot dog might get you an introduction to the mercenary (after all the poverty rate is high and they’re hungry), but in the end such an approach would waste a trained killers time and patience (watch your back).

    One size doesn’t fit all. But I don’t even think that Dr. Sullivan was saying that it did—I think he’s suggesting that aggressive strategies work, new things should be tried and it’s important to have the right strategy (Corp or TPR) for the right environment.

    Happy Hunting

  2. Great Part 2 article, John!

    Looking at all of the things they are doing at FirstMerit, and the things they will be working on, it is a laundry list of all of the things any good recruiting department should be doing. Yet, so few are doing half of it, or a quarter even. Which I suppose is why FirstMerit has been so successful.

    Interestingly, today I read an article about how retail firms from around the country have been communicating with and actively recruiting employees from the May department stores. It is generally believed that, after being bought out by Federated, an awful lot of them may be facing layoffs and are ripe for the picking. The only sensible thing to do if you’re trying to recruit retail management and buyer staff would be to go after May’s ‘A’ players. Right?

    That’s a little bit of what FirstMerit has done and Dr. John has advocated for years. Makes sense to me.

  3. Dr. Sullivan:

    Thanks for bringing Part II out. I am so glad to see you?re not one to back away from the gauntlet thrown.

    ‘Where mass opinion dominates the government, there is a morbid derangement of the true functions of power. The derangement brings about the enfeeblement, verging on paralysis, of the capacity to govern. This breakdown in the constitutional order is the cause of the precipitate and catastrophic decline of Western society. It may, if it cannot be arrested and reversed, bring about the fall of the West.’ ~ Walter Lippmann

    Your #6 caught my attention, and being involved in training others in names sourcing, I am asked, more than anything else, techniques about how to get around gatekeepers. You said, ?He also offers half-day clinics, one-on-one role playing exercises with recruiters on such topics as ‘getting around gatekeepers without ruses or lies…’.

    Oh, a subject that is really part of what lies at the core of why everyone went so wild over Part I. And there?s a theme that emerges from rusing and lying that I?d like to address here ? I expect a whole bunch of people to come down on me for this ? the fact of the matter is this: there is rusing and lying going on to get information in our business right at this very moment ? right or wrong may be a legal conundrum more intelligently argued by greater minds than mine ? but I?d like to offer something for you to think about ? rusing and lying creates a lot of discomfort in some people. I propose that it is this discomfort that makes people uncomfortable enough with the process to challenge themselves to learn new skills and techniques that work better than rusing and lying. It is possible to get ?around? gatekeepers by asking the ?right? questions ? ?center-of-influence development? is a big clue on this one – and First Merit?s director is to be commended for his foresight in developing, teaching and coaching ?cutting-edge recruiting techniques?.

    Taking this opine and applying it with a broad stroke to the firestorm that ensued from your Part I article on this subject I propose it is the very unease created by these discussions that prompts change, on its own, where needed, in our industry. Truly enlightened practices emerge from civil (they can be vociferous!) discussions – not from bludgeoning judgment.

  4. I have been biting my tongue for the last couple of weeks as I have read this two part article as well as Mr. Homula’s recent article from 7/21 about the next greatest weapon in the war for talent, a meeting that I attended.

    I cannot disagree with some of the ideas that Michael and his team have developed and how they may work for First Merit and some of the lower level and mid-level positions that they recruit for. I also am pleased to read of the relationship that he has with senior management at First Merit.

    However, it is difficult for me to acknowledge this organization as the benchmark of recruiting. Why? Because at the end of the day, it is for a bank that is not even on most radar screens in Northeast Ohio, let alone the rest of the country. As you can tell by my profile, I work for KeyBank, a $91B bank that is the 16th largest bank in the country. More importantly, I joined the bank 2 years ago because of the commitment to recruiting and the opportunity to replicate my experiences within a retained executive search firm AND become a true business partner to my internal clients. Since joining Key’s recruiting team, and joining with many other newcomers, Key’s stock has gone from $25/share to $34.50/share (First Merit’s stock has gone from $24/share to $28/share).

    Many of us within this organization know the impact and success we are having by the feedback we receive on a daily basis from our internal clients who see recruiting as a valuable asset to their success, who speak to us about their strategic initiatives rather than just a transaction and lastly who view us as real business partners.

    Are we still on a journey to enhance our processes, our resourcefulness, and our abilities ? Yes, but it has been difficult for me to read these articles and not respond and acknowledge the commitment and success KeyBank has had over the last few years. This bank’s success has been accomplished both by current employees but also by the numerous successful hires we have had in this period of time.

  5. After an enjoyable and relaxing vacation I feel compelled to address the comments made by one of our bank competitors here in Ohio.

    It is great to hear from one of our competitors in our market space. Very glad that Mr. Simon spoke up as it takes a lot of courage to speak your mind in this venue.

    First, Talent Acquisition does not only perform low level and mid level searches. We also conduct all of our C level executive searches as well and, as noted in Dr. Sullivan’s article, we have yet to pay a search fee for any of these positions this year. In fact, several of our high performing senior execs were recruited directly from Mr. Simon’s employer, KeyBank, without a paying a search firm to do it for us.

    Not that I am against using TPR. There is a time and place for their use. This is one of the many important facets of effective recruiting leadership – knowing what searches to farm out and which ones not to. Too many companies utilize search firm’s for placements they could and should make themselves.

    Before I address some of Mr. Simon’s points let me be perfectly clear. This is not about Mr. Simon. I have not met him and know only what others have told me about his skill as a recruiter. My Mother always told me to judge a man based on your own personal knowledge of them not on what others say. My commments in this post are not personal. It is all about business and the statements he made, which, in the battle of ideas, are fair game. I do not want to challenge Mr. Simon but, rather, some of the thoughts and idea’s espoused in his commentary.

    Let me address several of Mr. Simon’s points in order of appearance in his post.

    Mr Simon states: ‘However, it is difficult for me to acknowledge this organization as the benchmark of recruiting. Why? Because at the end of the day, it is for a bank that is not even on most radar screens in Northeast Ohio, let alone the rest of the country.’
    The identification of FirstMerit as the benchmark firm in recruiting has absolutely NOTHING to do with the size of our organization, it’s current stock price or anything else for that matter. It has everything to do with recruiting. In this sense, my blog is aptly titled – It’s The Recruiting, Stupid!

    KeyBank’s stock (as well as every other larger and national bank in NE Ohio) IS performing better than FirstMerit’s. Not because their recruiting teams are adding value to the stock, rather, their respective stock is performing better because they are a national bank who has absorbed the economic downturn of a manufacturing laden Northeastern Ohio economy with success in other more economically affluent parts of the country. FirstMerit, as a regional bank, is directly tied into the NE Ohio economy. How this economy goes so goes FMER.

    On a another note related to KeyCorp?s performance, the Wall Street Journal ran an article yesterday (August 22, 2005) entitled Aiding Profits At Some Banks: Setting Aside Less. In this article the WSJ notes that Key reported a 22% increase in profit for 2Q05 and it?s stock rose 1.6% a day after it announced its second quarter earnings. But why did Key report such great numbers? As the WSJ article goes on to state, Key added $54 million less to its loan loss reserve (the amount a bank sets aside for loans that might go bad) in order to aid its 2Q profit and EPS report. These profits do not actually reflect success in attracting borrowers and depositors. Without this move, Key would have fallen about 2 cents short of Wall Street profit targets which would have had an adverse effect on its stock price. Now, all banks do this to some degree. FirstMerit recently reduced the amount set aside for loan loss reserve but this was in response to a dramatic improvement in the credit quality of our loan portfolio ? meaning we don?t need as much set aside in the event of charge offs. From what we understand through competitive intelligence, KeyCorp set less aside in order to boost 2Q earning reports. Nothing illegal of course ? just thought the facts should be known.

    Mr. Simon goes on to say: ‘As you can tell by my profile, I work for KeyBank, a $91B bank that is the 16th largest bank in the country. More importantly, I joined the bank 2 years ago because of the commitment to recruiting and the opportunity to replicate my experiences within a retained executive search firm AND become a true business partner to my internal clients.’
    Having joined KeyBank two years ago, Mr. Simon should be well aware that ERE’s own Dr. John Sullivan was brought in to offer advice and consult to KeyBank on recruiting and how to improve what, in most recruiting circles, is known as an innefective recruiting structure. From what our intelligence tells us, KeyBank adopted very little (if any) of the recommendations made by Dr. Sullivan.

    One of the reasons Mr. Simon cited for joining KeyBank was to ‘replicate’ his experience with a retained executive search firm. Excellent idea! It is exactly what we did here at FirstMerit and why my team is primarily made up of sales professionals and former TPR’s. It is also exactly why we are getting better results than our competition. If the goal was to replicate the experience from TPR then why isn’t Key benefitting from this experience? How much did KeyBank spend last year in search firm fee’s? Do they even know? I have it on good authority it was well into the millions.

    As part of our competitive intelligence gathering and passive candidate sourcing we talk to many prospects, candidates and centers of influence who are former KeyBank employee’s or current KeyBank employee’s. They tell us that they wish their recruiting team engaged in the style of aggressive recruiting we do. I am not referring to all the bells and whistles or more controversial tactics that everyone wants to focus on but direct sourcing, consulting and better career opportunity matching. By the way, the same comments are heard from the prospects, candidates and centers of influence at our other bank competitors so this issue is not confined to KeyBank.

    We hear time and time again from these people that it takes entirely too long to fill a job at KeyBank (and other banks), their recruiters have requisition portfolio’s in the 40’s and 50’s (certainly not TPR workloads) and that more often then not they are requisition facilitators who simply process candidates that have been identified by search firms or client hiring managers. I also know they are engaged in a ton of administrivia including conducting new hire orientation and new hire paperwork. The recruiting structure at KeyBank (and other banks) is de-centralized with no real strategic plan or focus.

    What we do here at FirstMerit we do with very limited resources and a recruiting budget that would make the recruiting managers at our competition and other banks cringe. I say this merely to emphasize the point that it doesn’t take all the money in the world to win at the recruiting game. Our Talent Acquisition Team is centralized with clearly defined strategies and goals. KeyBank has sizeable resources and more money to allocate to recruiting then they really know what to do with. I can only imagine the kind of results we could get with those resources placed in the skillful and competent hands of the world class recruiters I have the honor of working with here at FirstMerit. But as the saying goes, it isn’t the size of the dog in the fight but the size of the fight in the dog!

    If KeyBank is so committed to recruiting and the recruiting team is so well valued by management then why is the word on the street and among their own management team saying something entirely different?

    And why is the executive search function at KeyBank, a team Mr. Simon is a part of, outsourcing a large number of it’s searches to search firms? Recruiters in third party recruiting talk and network. Some of them talk and network with me and members of my team. We know that a large number of executive level searches at KeyBank are being filled by TPR’s not their own executive search group. I would love to know the recruiting efficiency ratio at KeyBank. Do they even know or are they still measuring the antiquated metric of cost-per-hire?

    Finally, Mr. Simon spent a lot of time talking about how proud he is to work at KeyBank and that the recruiting team at KeyBank is every bit as good as FirstMerit’s. This is great rhetoric but where are the facts to back it up? His commentary was noticeably void of any of their best practices and actual evidence of results.

    Corporate recruiting as a whole MUST get better. It is absolutely awful! I have said it publicly and I will say it again here. I am very proud of what we have accomplished at FirstMerit and the credit and glory belongs to my team and God, who gifted us all with our unique talents and gifts. However, as I have said, our success and recognition is not so much a reflection of how good we are, rather a reflection of how awful recruiting is in corporate America. We are quite good at what we do, in my opinion a 7 on a 10 scale, with a ton of room to improve. There are some (emphasis on SOME) other companies out there doing great corporate recruiting but the bulk of corporate recruiting in America is just at a 4 or worse.

    We all MUST get better!

    Our companies need us and we have to improve in order to add real value!

  6. It appears to me that when a TPR (that would be Homula) ventures over to the darkside, those still on the search side – or those with executive search still in their hearts – take great umbrage to this heathen act.

    But let’s talk about – from my perspective – two important points here: One, re-read the title of the article (I’ll help you – ‘The Best Practices of the Most Aggressive Recruiting Department’); two, what constitutes financial performance.

    To the second point (yes, I believe it is the more important of the two), Zach wrote that ‘Since joining Key’s recruiting team, and joining with many other newcomers, Key’s stock has gone from $25/share to $34.50/share (First Merit’s stock has gone from $24/share to $28/share).’ Very nice – except there’s no way this entire result can attributed to recruiting – if at all. If any models had been created to analyze the dynamic effects of recruiting, the results would have been touted – and shouted. Homula explained the dynamics of Wall Street and the banking vertical so well that I’d just screw it up by adding more (well, other than the multitude of FAS rules that permit creative accounting).

    To the second point – and I’ll challenge Zach on this – if you want to be acknowledged, write an article on some of the aggressive techniques you’ve implemented at KeyBank. As Michael said, everyone – even First Merit – can learn from others.

    Our profession has enough challenges; the last thing we need is for people to fight over who gets the credit for success.

  7. I thought those following this forum might be interested in the 8/22/2005 San Diego Business Journal piece ?Bank Latest to Entice Employees From Competitor?, by Mike Allen. It discusses Commercial Capital Bancorp’s hiring experienced, top talent James Daley (former Cabinet head under the late Gov. Ronald Reagan) along with 23 additional staffers, nearly half of another bank?s unit, from the competition, Comerica, doing the same business; and Comerica?s retaliation in a lawsuit in San Francisco Superior Court for conspiring to misuse Comerica?s trade secrets and confidential customer information, and for raiding its work force. Comerica was granted a temporary restraining order preventing Commercial Capital Bancorp from ?using, destroying, concealing and/or disclosing any of the Comerica Bank?s confidential, proprietary or trade secret information regarding Comerica?s customers and employees.?

    I’m not suggesting this parallels FirstMerit practices in terms of formal recruiting strategies, just thought it good fodder to keep the dialog moving. To see the full article visit the link:

  8. Michael –

    I just want you to know, that I appreciate the time you spent on your response, which is why I took the time to read it – you make this Forum interesting and informative.


  9. This forum is about recruitment not banking. The comments fired at Keybank are cheap shots at a bigger competitor and just childish. They certainly have no relevance to recruitment or indeed the topic being discussed.

    Why is it a surprise that Keybank chose to ignore Dr Sullivan?s recommendations. In his own words, he admits that they would not be tolerated in 99% of firms.

    Doesn?t that tell you something?

    You might be interested to read this article’s review by one of the industry’s leading author’s and specialist’s, Nick Corcodilos.

    I was pleased to see that some of us are not alone in recognising what these ‘best’ practices really mean and the wider audience, including job hunters, will now get a chance to comment.

    I hope Nick will share the feedback and response with us.

  10. RE: Michael Homula’s post about ‘Why haven’t you called me yet? I have offered my number (at least 2 weeks ago) to you and anyone else who has issues with our Talent Acquisition Team, including Nick Corcodilos, and I have yet to hear from any of you. I am anxiously awaiting the opportunity to discuss our strategies and tactics with you directly.’

    I have no intention of calling you. I’m not ‘blindfolded in the dark’ and you have not ‘tapped into my wealth stream.’ You have indicated that you stand by the article about your business practices, strategies and tactics. I’m not interested in a sales pitch, in rationalizations, relativistic ethics, or an explanation. I don’t really care how you operate your business or how successful you are at recruiting compared to your competitors.

    I’m concerned with recruiting behavior and with how it affects job hunters. My objectives are to advise my readers on how to protect themselves and advance their careers while building good reputations.

    I said my piece in my newsletter, but I’ll quote Marcus Aurelius again: ‘The first rule is to keep an untroubled spirit. The second is to look things in the face and know them for what they are.’

    That about says it.

  11. Brandon, interesting article but as you said, it’s not what FirstMerit are doing and is not the issue.

    The issue with FirstMerit is the way they recruit, not who they recruit.

    I wonder how many hotdogs it would take to get a whole team out of a competitor?

    The interesting thing about this article and one that some people refuse to get is that had Commercial Capital Bancorp used a TPR or several TPRs for this project, they would not be having the same, very costly problems and bad publicity they are experiencing now.

    1/. They would not have been directly responsible for poaching from Comerica and therefore could not be blamed for it. As far as they were concerned, these candidates came to them.

    2/. A decent TPR would have given a greater selection of people from other banks rather than just the one and mixed it up a bit knowing what was coming.

    Yes they would have paid out fees but who knows how much this will cost them now in bad publicity and in fines.

  12. Brandon,
    great points, it is hard to find information regarding litigation w/financial institutes as their Lawsuits are generally confidential.

    Another interesting note – Financial Institutions have certain regulations re their trade secrets, and they have to worry about trade secrets for obvious reasons, especially when mission-critical trade secrets are at issue. Trade law also allows for protection of trade secrets even in California where non compete contract clauses are subject to statutory restriction, as a key employee could misappropriate the trade secrets, disclose the trade secrets to a competitor for financial and impair the competitive position of the business.

  13. Dear Detractors:

    Why haven’t you called me yet? I have offered my number (at least 2 weeks ago) to you and anyone else who has issues with our Talent Acquisition Team, including Nick Corcodilos, and I have yet to hear from any of you. I am anxiously awaiting the opportunity to discuss our strategies and tactics with you directly.

    Some have called my comments on KeyBank and their recruiting efforts ‘childish’ yet when Mr. Simon commented about FirstMerit they had nothing but praise for him. The tone and content of my commentary was factual, accurate and offered in much the same tone as Mr. Simon’s comments. We have an incredible amount of competitive intelligence on our competition’s recruiting tactics, employee incentive plans etc and speak with talent in these organizations daily – what I pointed out was fact. Yet I am ‘childish’. I once heard that name calling is the last resort of an exhausted mind.

    The real issue is that we are winning the best talent to FirstMerit ahead of our bank competitors in NE Ohio and that is why our competitors are so miffed. It is also why they are all calling here regularly attempting to recruit me and my team to come work for them – yes, even KeyBank. If what we are doing is so wrong, and other banks like Key are doing so well, why would they be after us to replicate what we do here at FirstMerit with them?

    One can criticize and evangelize about how unethical and deceptive I am and, by extension, my team. Without first hand knowledge you might as well be swinging at a pinata while blindfolded in the dark. Call me. Find out what makes me tick, what’s in my heart and you might just sing a different tune. Maybe not. It certainly appears that some are just hell bent on destructive attitudes because we have tapped into their wealth stream. Great recruiting is not best left to TPR’s despite what some might think.

  14. JOn, it is nice that you respond to these emails and let them know that you appreciate them.
    You are a stand up guy.

  15. Nick
    YOU GO!!! Excellent article by the way, it was all over the net. Seems to really hit a nerve with many individuals… Hey seems I even got quoted, even though it was W/O my approval.. At least it was all good.

    I say, why don’t we take a vote, let’s get all the candidates togethor and have them voice an opinion on this matter. See What They think..

    Yes to be sure there are some recruiters that seem to approve of these so called ‘aggressive’ tactics, (I think it is just due to lack of knowledge myself) but let’s play this role, what if the shoe was on your wifes foot, or your daughter or you yourself.

    What if You put your job on the line and had applied for a job to find out that it was not you they were looking for, but your boss.

    What if it were YOU who really wanted a job with a company, gee the money sounded great, everything was presented well, so now you were salivating for that position, and then you were informed ‘we will give you a job, but you have to give us names of the individuals you worked with first, sorry dude, I know you feel some loyalty, but in this company everyone has to be a recruiter’ – now you are forced to question your own loyalty, but all you can see is that raise, and your family and kids, mortgage, and car payment, etc. Yes that is a great way to start a job now isn’t it….

    I think Maureen Said it well (based upon MY read on it).. When one does have to continually justify and explain ones behavior, it is usually because one is not comfortable with one’s own actions.

    And by the way Here is my number… 858-668-3111

  16. I find it ‘odd’ (to say the least) that Nick would write an article in his newsletter and not address it directly first here on the forum, only responding when called out.


  17. As a person who was laid off about two years ago and just recently found employment, I am very disappointed and concerned at the methods suggested by John Sullivan in the above mentioned article. I have copied parts of the article below and added my responses.

    ==> ‘A poaching emphasis. FirstMerit’s talent acquisition strategy is primarily a ‘poaching’ strategy. They focus 100% of their recruiting efforts on currently employed, already trained talent (the so-called passive candidates).’

    ‘poach’ defn: (1) to trespass on private property, esp. for hunting or fishing to hunt or catch fish illegally.
    ‘Poach’ sounds like it is an unethical method.

    To focus ALL effort on ‘currently employed, already trained talent’ means that they are ignoring totally candidates that, through no fault of their own, are currently unemployed and are eager to be employed.

    ==>’Send cookies when prospects are rethinking their life. … They gather all kinds of data on candidates, including decision-making criteria, spouse and family names, birthdays, and anniversaries.’

    ‘spouse and family names, birthdays, and anniversaries’ – can you say the words ‘Invasion of privacy’? How about ‘identity theft’?

    ==> ‘Recruiting on their turf. Some members of the recruiting team wandered through a competitor’s offsite seminar wearing the competitor’s lapel buttons.’

    This is trespassing plain and simple and could easily lead to criminal prosecution!

    ==> ‘Buy your own offer letter. This process requires some finalist candidates to provide three names of top talent at their current firm (with phone numbers and an introduction ‘to us from you’) as a ‘price’ for their offer letter. The introductions must be made before the offer letter is given. The premise is to let everyone know, before they even start at FirstMerit, that everyone is expected to be recruiting 24/7. Even a candidate’s references are considered fair game as hiring targets.’

    ‘as a ‘price’ for their offer letter’ What a sleazy thing to do! If I were a candidate and was told this, I would think that for that company, AS A WHOLE, there was nothing too sleazy for them to do AT ANY TIME to me or to anyone else during my employment.

    ==> ‘Raiding during a traumatic event. …The team holds phone-in parties to inundate the firm with calls …’

    ‘inundate the firm with calls’ – Check with your phone company; I believe this would fall under ‘obscene and harassing calls’ which are illegal. I believe the company receiving the calls would also have legal grounds for a civil lawsuit.

    ==> ‘Competitive intelligence mixed with recruiting. The director created a recruiting roundtable with the announced intent of learning and sharing. However, the quarterly roundtables had other purposes:’

    Nothing like more deception during employment. What do you think the employees invited to the roundtable will think about HR when they realize, and they will, that HR is lying about the purpose of the roundtable?

    ==>’Job boards versus the phone. … For example, if they are trying to hire commercial lenders, instead of placing an ad for a commercial lender, they take the indirect approach and place one for a lending assistant…’

    More lying and misrepresentation – just wait until the word spreads around – and it will!

    ==>’Service level agreements. … Managers commit to making decisions on candidates within 48 hours.’

    For managers that wish to interview the top five or so candidates which will probably take several days – maybe even a week, they now know that they must choose just from those that interview the first two days!

    ==>’They need to develop a system to proactively identify internal talent that is misaligned and to move it to areas where it will have a higher return.’

    Move ‘it’? Now that really makes me want to work there! I’d be just an ‘it’!

    ==>’As their notoriety grows, they will become a prime poaching target for firms both within and outside of banking.’

    ‘notoriety’ – defn: the quality or state of being widely known, especially unfavorably. As the above, and the other mentioned methods, become widely known, and possible lawsuits filed, they WILL become notorious!

    Summarizing, the reason the actions of HR recruiters offend me as a job seeker is that, if they act like this toward another company that probably has a roomful of lawyers at their beck and call, how will they treat me as an employee during my time with them? I don’t have even one lawyer at my beck and call and they know it.

    From outplacement services and other job hunting activities, I have found that the typical time to ‘resolve’ a lawsuit between a former employee and the company they worked for/are suing is about SIX years. If during this time you find similar employment at a similar rate, you will probably not win the lawsuit even though it has merit. If you do win, the award will probably be minimal – even for egregious conduct on the employer’s part.

    If the recruiters work for a recruiting company that was engaged by the company potentially hiring me, then it says something about who/what companies they are willing to make deals with. What may I end up getting involved with while an employee?

    Look at the trouble Wal-Mart got into because a company they contracted with to clean their stores was hiring illegal aliens. ref: ‘In a recently settled lawsuit, Wal-Mart agreed to pay $11 million in fines for hiring illegal workers to clean some of its stores during overnight shifts. Wal-Mart officials insist they were not aware that the contractors they used were hiring undocumented workers.’

    I have no problem with honest, above-board recruiting. Over the years I have received many calls at work from recruiters and have willingly talked to them for a few minutes even if I was not interested.

    (reposted from part one)

  18. ‘I too am concerned with job seekers, both passive and active, and helping them to improve their careers.’

    Actually your not. This is about saving money and being better at this than anyone else at the cost of competitors and innocent candidates.

    As you say, you are improving shareholder value by improving recruiting efficiency ratio’s, dramatically shrinking time to fill. Your results are better than your competitors etc. etc. etc.

    You’re not interested in the candidates wellfare, just that they fit the ‘talent’ bill.

    Why refer to candidates as talent? That takes the person out of the candidate. Candidates are people with lives not simply commodities called talent for companies to use.

    Why do some ex TPR’s constantly try to prove themselves better than a TPR? We serve a different function. It’s like employing plumbers to do the electrical work and then praising yourself for saving money on electricians.

    We can’t do what you do and you can’t do what we do. That’s why a lot of Corporate Recruiters use TPRs where necessary.

    ‘We don’t drive up in an unmarked van and kidnap talent.’

    No, the van has your competitors name on it.

    I have never heard of anyone leading from beneath. Hmmmmm.

    ‘All the quoting of philosophers and business leaders around here is funny to me. ERE could start its own quotes website with all the people quoted in the discussion threads on this article alone.’

    Philosophers and business leaders are real people in the real world. There are some excellent quotes on ERE that EVERYONE can learn from and here are a few more.

    ‘A leader must have the courage to act against an expert’s advice.’

    ‘Be more concerned with your character than with your reputation. Your character is what you really are while your reputation is merely what others think you are.’ John Wooden

  19. Thanks for your comments Nick. It seems we have some common ground. I too am concerned with job seekers, both passive and active, and helping them to improve their careers.

    Since we are so concerned with how recruiting tactics effect job hunters has anyone stopped to consider the fact that high performing passive and active job seekers at our competition are drawn to FirstMerit and inspired by our drive to help them improve their careers? We don’t drive up in an unmarked van and kidnap talent. We have a compelling story and a great recruiting machine to match it. Since our recognition by ERE and Dr. Sullivan we have had an enormous number of candidates consider FirstMerit solely on the basis of this success. They want to be a part of an organization that takes recruiting so seriously because they recognize that people drive profits. In order to get great people you have to have great recruiting.

    NO ONE will leave unless it is for a better opportunity than the one they are in currently. That better opportunity means different things to different people. Talent also won’t leave unless the key criteria they will use to make a decision are met. The concepts we employ are designed to create buzz in the marketplace (something we have undoubtedly accomplished) in order to drive talent to consider working at FirstMerit. Once we have their attention (through referrals, networking, cookie mailings, birthday cards, new years eve card, all the other tactics we use etc.) they won’t make a change unless there is substance and we offer them a better opportunity.

    Our results are better than our competitors for a reason and the reason is not all the tactics and strategies we employ. Each day we hire some of the best talent in Ohio to work for FirstMerit. We are improving shareholder value by improving recruiting efficiency ratio’s, dramatically shrinking time to fill, dramatically reducing actual vs. contracted time to fill, hiring talent that get’s defined results, providing our candidates a bill or rights which tells them how they will be treated, engaging our client hiring managers with service level agreements, lowering (by more than $1 million) search fee’s and hiring better talent quicker with greater ROI than the TPR’s we once used. The list can go one but for the sake of brevity I will stop.

    These results don’t happen simply because we are aggressive or employ aggressive, outside the box and perhaps controversial tactics. It happens because my Talent Acquisition Consultants are great recruiters who know how to match talent with a better opportunity and because high performing passive talent have a reason to come here.

    What about that isn’t keeping the best interest of passive and active job seekers in mind?

    My team is the reason we succeed and the reason we get results. As I have written before, the single greatest weapon any company can have in their arsenal is a competent, skilled and artful recruiter. My role is simply to be a servant to my team. Which means I lead by empowering them and loving them so they can succeed. I lead from beneath.

    All the quoting of philosophers and business leaders around here is funny to me. ERE could start its own quotes website with all the people quoted in the discussion threads on this article alone.

    I don’t subscribe to the philosophy and musings of earthly men and women. Sure there have been some brilliant people throughout the ages, including Marcus Aurelius, but their brilliance is not of their own doing. I refuse to let what will rot rule the eternal. For me, I will be influenced only by God and taught only by Jesus Christ.

  20. ‘If thou art pained by any external thing, it is not this that disturbs thee, but thy own judgment about it. And it is in thy power to wipe out this judgment now.’ ~ Marcus Aurelius

  21. I, as someone looking for employment, would prefer to be referred to as a ‘candidate’; especially with the comment in the article, ‘They need to develop a system to proactively identify internal talent that is misaligned and to move >>> it <<< to areas where it will have a higher return.' Move 'it'? Talent is an 'it'???

  22. Mr Haley seemed concerned or even perplexed by the concept of leading from beneath.

    Leading from beneath is a concept called servant leadership. I would encourage anyone in a leadership role to consider investigating it as the core driving principle of their leadership. It is a concept best examplified by the sacrifice of your own personal needs for the benefit of others. In a business scenario that means sacrificing for the team you lead. It means to LOVE them. Not love in the greek sense of ‘eros’ love – all that romantic stuff – but ‘agape’ love. Selfless sacrifice. I will be writing an article in the near future on leading great recruiters that will provide much more detail. Perhaps the best historical example I can give you would be the example of Jesus.

    Mr. Haley was also concerned because we prefer to use the terminology of talent rather than candidate. The reason for this is quite simple. We refer to people as talent rather than candidate because the term candidate implies that they are just one of many. One of the definitions of talent, if you look it up in the dictionary, is ‘a special often creative or artistic gift or aptitude’. In our opinion, every human being is endowed with unique gifts or talents. Some of those gifts and talents match up with FirstMerit and some of them do not. Referring to them as simply candidates is far more dehumanizing than referring to them as talent. Which would you rather be, a candidate or someone viewed as having talent?

    Matching a persons unique gifts and talents to the needs of our company is one of our highest priorities. We don’t just hire anyone for the sake of hiring them nor do we just hire them because they are from our competition. We hire the best performing talent in order to improve their careers and lives as well as improve our company. If they don’t match our company, we encourage and refer them to other organizations as a means to help talented people improve their lives. The NE Ohio corporate landscape is littered with talent that were not a good match, either by their choice or ours, and were ultimately hired as the result of a FirstMerit Talent Acquisition Consultant’s referral.

    It is unfortunate, Mr. Haley, that you appear determined to put your own meaning into my words. As of yet, I have still not received a phone call from you, or any of our other detractors, to discuss these matters personally. I do desire to make your acquaintance. You can reach me at 330-849-8976.

    Warmest regards,

  23. Servant leadership is a contradiction in terms. You?re either the servant or the leader. Supporting your team is called good management but every team needs a leader to lead from the front and give direction.

    I doubt that there have been too many corporations built on leading from beneath, behind or servant leading.

    Which would I rather be, a candidate or someone viewed as having talent?

    I would rather be viewed as a candidate???? that has talent. The main definition of candidate, if you look it up in the dictionary is ?a person looking for a job or position?. If you are in contention for a job, you are a candidate. Talent is what a candidate has. How can being called a candidate be dehumanizing compared to calling them talent?

    I do not have any desire to have private calls or messages. It is far more beneficial for everyone with these discussions in the open forum. That is the whole point of ERE.

  24. Mr Haley,

    Michael is referring to an age old concept original to Christ that the best leader is a servant, and is not ultimately more concerned about himself than the people he/she leads. There have in fact been numerous companies that have been built upon that concept that have flourished. However, it does fly in the face of what many would consider common sense.

    I didn’t attend it, but your comments reminded me that here in Louisville there was a leadership seminar at one of local churches called ‘Lead Like Jesus’ that was well attended and that many very prominent business leaders in the community participated in. (For more info, check out

    Personally, I’ve had a lot of interaction with executives both as a 3rd party recruiter and as a HR Manager, and I generally had a very low impression of the ‘leaders’ who sought to lead their organization by dominating those beneath them… That’s not to say that if you’re not a ‘servant leader’ you’re a complete jerk, but many are… Seems to go with the territory these days.

    Anyway, I’m off the soabbox… Just wanted to say that the concept of servant leadership is certainly not new, nor is it untested.


  25. Now, now. Just because it isn’t in your vocabulary doesn’t mean it is a figment of someone’s imagination.

    Servant leadership:
    Servant-Leadership is a practical philosophy which supports people who choose to serve first, and then lead as a way of expanding service to individuals and institutions. Servant-leaders may or may not hold formal leadership positions. Servant-leadership encourages collaboration, trust, foresight, listening, and the ethical use of power and empowerment.

  26. Wow, as much fun as I was having watching this from the sidelines, I gotta jump in here too. The things that Brian points out are the things that really bother me too (with all due respect to Dr. Sullivan, whom I know and like). I do personally find some of those things to be dishonest (regardless of anyone’s religious beliefs…not quite sure why that is an issue here…not sure that the religious figure of ones choosing would care to take sides on this one). I actually do think many companies use similar tactics but don’t come out and say it. I wouldn’t work at any of those companies but that’s based on my comfort zone (zero tolerance for lying…I’m the person to ask if you really want to know if those jeans make you look bad ; )). Just my personal opinion. Someone had to vote FirstMerit into their ERE award. I guess I’d like to hear from some of those people (I didn’t vote) on what they think about the tactics (obviously some voters think they are OK)and what part those partcular tactics played in their voting decision. Just interested in the dialog.

    Something else that bothers me is the feedback I hear from candidates on less-than-honest recruiters which have contacted them. The bottomline is that we ALL have to deal with the repercussions and I think that is why you are seeing such a passionate response here.

    Here’s a best practice I’d like to hear more about: honest AND aggressive. Dr. Sullivan, an article on that please? ; )

  27. Not sure what kind of leaders you deal with but most of the ones I know take great pride in being of service. Servitude is in fact a sign of great leadership.

    Name me one CEO of a publicly traded company that doesn’t serve his/her shareholders in some way shape or form.

    Have not all the great leaders of our time been servants in some way shape or form?

    Does Bush (ok maybe not the best example)not serve the citizens of the US of A?

    Colin Powell was a great leader but did he not serve his country?

    JFK certainly served well.

    All were great leaders who humbly served their country.

  28. Tim, I am familiar with the servant leadership style. I just think it’s flawed before it starts.

    I had not heard of the term leading from beneath.

    All good leaders should be more concerned and supportive with their team or company but not subservient to them. By being a strong leader from the front is still putting the team first but ultimately the leader has to be in charge. Any good manager knows that if their team are succesful, they will be.

    Good leaders have to make tough decisions all the time. You cannot sack your master and if you can, you was not the servant in the first place. If you can’t, you never were the leader.

    I agree that dominating your team is also bad management. It’s no more effective in the long term than being a servant to them. They are both extremes that are opposites. One being too strong and the other being too weak and neither I suspect gaining any true respect.

    A good manager needs to be flexible and have the ability to adopt many styles, not just one.

    Adopting your management style in business to suit your religious belief’s seem’s a bit naive to me.

  29. Caron,

    …….and the ethical use of power and empowerment.

    Given the subject matter of this forum, I think there might be a contradition in terms for this style of leadership.

  30. ‘Name me one CEO of a publicly traded company that doesn’t serve his/her shareholders in some way shape or form.’

    Michael, that is my whole point. The CEO serves his shareholders because he is answerable to them. He does not serve his employees. They serve him and if they don’t, he get’s rid of them and finds someone that will.

    The CEO supports his employees to help them serve him and achieve results but that is different.

    Servitude is the condition of being forced to work for others. That’s slavery.

    Country leaders (like Blair. Okay, another not so good example) serve their country by leading. That’s why they are called leaders. But to serve in that sense and to be a servant are two different things.

    Serving your country does not mean adopting servant leadership style. It means doing the best job possible for your country and it’s people.

  31. I do not adopt my management style in business to suit my religious belief’s, rather my faith and knowledge of the truth drive my behavior in both my personal and professional life, including the way I lead. The difference is much more than semantics.

  32. When I look at these posts over and over again, it still amazes me that we have to have a heated discussion about what is Legal what is not, what is ethical what is not, what is right and what is wrong, what is judicious and what is not too smart.. (please no arguments about subjective).

    First off we make excuses for behavior which hurts others and say hey it is ok, because I am a recruiter, its my job.

    We argue issues about law, decorum, how we handle the privacy of people and companies by rationalizing we are doing it in the best interest of company, candidates, clients, and self, and find ways to excuse our behavior so that we can continue hurting others, not learn something new, and not find a better way. That takes too much work

    We find ways to justify bad behavior to be all right.

    In the Past Three years on this forum I have called righteous, Pollyannaish, boring, virtuous, pompous sanctimonious among other things. (this is the good stuff by the way) – Well many have met me, they can attest that I am definitely not boring and I prefer to describe myself more as Respectable, honest, decent, upright, and ethical?

    People have argued about the law cases I have presented, stating ?it was stupid people doing stupid things, that allowed them to get caught? (hmmm, well I guess anytime one breaks a law, it is stupid people doing stupid things),

    It has been stated the cases information presented were specific cases and not generalized, sometimes subjective, sometimes objective (well duhhhh!!!) That is generally what standard information is..

    Arguments have been made That the laws presented were not real, that I misquoted or misunderstood ? hmm, make no mistake the edicts, bylaws, regulations (what ever you want to call them) against predatory recruiting and Unfair competition are REALLY in the Articles in the FTC Judicial ACTS, they are Real, and in most cases very ambiguous (which is generally not a good thing for the defendant).. Now though I am not a lawyer, I did even put up links to this information for education purposes,,,, which brings up another point –

    I have even been warned by members off and on line that I am endangering my self with a risk for lawsuit by stating this information, because I am not a lawyer (sheesh!!!!! For Crying out loud, ANYBODY can quote the law, cite information, in any shape way or form, duh!!!! And if we could not then we may as well hang up our jobs today in HR, accounting, real estate and such like ? I look at that as another way to find a way to justify and continue specific behavior and to create less reliability to what has been presented, and take the heat off ?

    People, this is Not a private forum, anyone can see what we write here, and they have. There are a LOT MORE articles than the one that Nick Wrote (to his defense, he responded after his article was written) that are providing more information to the public; The public is angry, they are expressing for the world to see why they are mad at this type of behavior. The same behavior to which by the way the Government is taking NOTICE!!!!

    The public are mad, they are mad at the nefarious behavior of recruiters, they are mad at the lack of respect we have to the public, they are mad at the way we handle privacy of clients and candidates, they are mad at OUR Proven LACK of ethics, lack of principles, the are mad at the way we cheat, lie, misrepresent, discount standards, values and the law just to make a placement

    There are comments about our lack of Regulation, they are warning people NOT to use our services, they are informing others to Complain to the BBB, Attorney General. Then articles like this come out and they are proven –

    The spotlight is on us now, and articles like this only make it worse, especially with the issues of identity theft with regards to the recent ?breaking in? of Choice Point and Master Card, the Government is also watching.

    The people are talking, and the question is when are we going to listen ? Are we going to continue to deny that this negative behavior is not damaging this industry..

    The problem with this industry is that it is too darn easy to enter, lack of education creates ignorance, ignorance is not bliss, because it does allow for illegal and unethical behavior

    ?IF YOU DO WRONG, YOU DAMAGE OUR INDUSTRY,?. YOU?VE DO US ALL WRONG ‘Ethics ultimately is self-regulation,’ Imposed regulation is law, (so) in our industry, (when) we don’t self-regulate, we create laws.
    If you wait to teach a person ethics when they’re in college, you’ve waited too long. Education alone can’t make a person ethical, he said — but ethics can be an outgrowth of, and demonstrate itself as, responsible decision making.? John Gibson, AAPG Ethics leader
    Here are some articles,10801,46806,00.html

    google searches that can be used to find this information
    unscrupulous recruiters, unethical recruiters, recruiters suck, hate recruiters, unscrupulous executive search, unethical executive search, unethical headhunters, hate headhunters, unscrupulous headhunters
    caution using recruiters, caution using headhunters, caution using executive search

  33. I’m a TPR and NOT against using agressive (but honest) tactics to get candidates.

    I do consider some of the tactics mentioned to be unethical or at least questionable. Wandering the halls wearing the competitors lapel was of questionable ethics (it lead other people to believe they were with the competition, not against them, and therefore they misrepresented themselves). I wonder if they would have been admitted had they not done so? Wearing their own lapels or none would have been above board and not dishonest.

    I wonder how many candidates refused to give referrals and if they actually did not give them an offer letter as a result? Some candidates (ie. ethical ones) would NOT do so and would seriously question the company at that time. Definitely a risk of losing good people. Asking for referrals is recruiting 101. Demanding them is another matter. I also question the ethics of a person/candidate that would willingly damage an exemployer. It could be against the law if the candidate signed a contract that prohibited them from such actions (I’m not a lawyer but have been told you can also potentially be liable for assisting someone break a contract). I have seen contracts that prohibited taking of employees or assisting in such actions.

    Agressive recruiting SHOULD be done by good recruiters, however there is a line between that and ‘sleaziness’. I suppose where that line is drawn is a personal issue that some people believe has been crossed in these articles.

  34. Please, enough with the servitude of employees.. In regards to Servitude, there is NO mention, NONE to the Service and Obligations of protecting their Clients and Customers Interest!!!!

    What about the commitment to their stakeholders, their Employees, shareholders as well as their community to protect them from loss of value through possible lawsuits, bad reputation, unethical behavior, and lack of consumer confidence.

    Public Companies have a duty and do create an implied contract and Public Policy that that they will do their best maintaining values, ethics, credibility, a strong Moral Compass, not have shortsighted goals and short term earnings at the expense of long term value

    What makes it more interesting is that Financial Institutions actually have Regulation, Laws and Guidelines (goes beyond ethics) and some of these do influence their behavior and actions ? where they obligated to take measures to preserve legal protection for its confidential data and an obligation to their customers to have contractual protection, and information protection training in place for their employees to protect their customers especially from the Misappropriation of Trade Secrets.

    I guess Ethics are only subjective when it comes to forgetting who and what really is important

  35. Here’s just a little bit of food for thought…

    While there are some on here that want to bemoan how bad our image is and how soooooo many people are upset and angry with us – I just keep on getting clients that have had bad experiences in the past but now work with me (and some exclusively) because they realize as most of us do that you can’t stereotype a whole profession by what a few in the industry may do. Of course, it’s part of my job to help them realize the truth in that. I believe that’s a skill called ‘Objection Handling’ that all good recruiters acquire.

    I picked up two such clients last week and just finished taking an hour preparing a candidate for his interview tomorrow. That’s about the same amount of time that some spend on here pontificating to the rest of us about how we should fall in line under the guidelines and regulations those particular people think we should all follow.

    I also closed a first placement last Friday with a new client – ergo they haven’t stopped using recruiters or trusting new ones. So I want to encourage everyone out there to think positive and not fall victim to the endless negativity of some who choose to stand as high as possible on their own self-built Soap Box and cry at the top of their voice that the sky is falling and the world is coming to an end!

    It ain’t folks! And it just keeps getting better and better. Moreover, we don’t need anyone else trying to impose their own business practices, regulations, or laws on the rest of us.

    All one has to remember is the simply truth that one will reap what they sew. If I want apples, I just plant apple seeds and then take care of the seed until it becomes a tree. The apples will come. That much I know – and there will be a whole lot more than just one apple from that one seed. All I have to do is be careful as to what seeds I sew.

    I don’t need some other farmer telling me how to regulate my planting, cultivating, or harvesting!

  36. Heather,
    awesome post… It isn’t about if the industry will eventually weed the bad apples away, because there will always be the new ones uneducated ones that will penetrate.

    The problem I think that people do not realize is that the big huge Magnifying Glass is on us.

    People, do we forget that ChoicePoint and Card Systems both had Secruity breaches – 40 Million+ Id’s were stolen.

    What does that have to do with us – well everything.. We are information brokers ourselves.. Yes we are, we sell information of Candidates to Companies, (resumes and personal information), We are in positions that can affect peoples lives..

    Everytime we submit resumes, information or names of candidates w/o talking to companies (jobs and companies may not even be real for that matter) and w/o talking to candidates and getting their permission we can ultimately affect some poor person’s life, financially,
    morally, and even his job.

    How many people actually even do background checks of companies to see if the jobs or companies are real.

    Have you ever wondered what happens to the resumes that don’t get placed at those companies that the information was sent into w/o permission? Who do you think is liable for misuse of information?

    What about everytime a company is hurt because they had a confidential position, and the candidates were informed on the position of the company financially (w/o first getting interest from the company) One company actually went Bankrupt because of A recruiter attempting to replace A ceo in a confidential position, the company who was going to make an investment into the organization found out, and walked away from the deal. The CEO was going to stay on for a year or so to make sure all things went through as promised, but they were unable to present their case.

    There are people who do care what happens to these candidates and companies, even if you don’t. Do you think that those people will just continue to let us break the law, hurt individuals, and continue to risk the Public’s welfare, do you this they will let us keep acting this way w/o doing something. Really!!!???

    To think we are behind bubble wrap, and that our behavior is not being reviewed well that is just plain ?????

    Remember – I will repeat myself again ?If you do wrong, you damage our whole industry. You?ve done Us all wrong

    ‘Ethics ultimately is self-regulation,’ Imposed regulation is law, (so) in our industry, (when) we don’t self-regulate, we create laws.

    We have to present a better position as a whole industry, this includes Corprate, TPR, and Staffing Recruiting. We do HAVE to do this or someone else WILL do it for US.

  37. Again, Michael-

    Thanks for your contributions.

    Its refreshing to see someone so positive about their company and their practices.


  38. Heather the ERE awards that you rightly question were judged by 10 different judges and 5 judges judged each award. ERE actually had nothing to do with who won the awards because they left it up to the judges to decide.

    I guess we know at least one of the judges.

    I think it unlikely that the others will speak up because they either agree or do not want to be seen disagreeing, which is a shame.

  39. When so many ‘industry experts’ keep writing articles that use sensationalist phrases like ‘winning the talent war’ in the headlines (the use of the words ‘winning’ and ‘war’ are particularly worrying), is it any wonder that tactics common to ‘spies’ and ‘covert operatives’ are used and that anything is justified as long as the right side ‘wins’?

    We as a society sanction the murder innocent people in Iraq everyday, but because the enemy also does it and because we perceive our version of the truth to be the only truth, we allow it to happen.

    I’ve said it before and I’ll say it again…..First Merit are only mirroring the actions of a vast number of TPR’s out there. They are simply taking control of the recruitment process and putting it back where it should be. With them, the client. That is an important quantum leap in the evolution of the recruitment industry in my opinion. Once the trend becomes more common, concepts like coporate social responsibility and employment branding/reputation will kick in. After all, companies have a lot more to lose than the vast majority of TPR’s.

    I too have a number of issues with some of the specifics of what happens at First Merit…..but maybe the bigger picture needs to be looked at first. But any TPR’s out there that try to say that the majority of their industry don’t enagage in similar tactics are either fools or liars….again, in my opinion.

    I think overall, Michael Homula should be applauded for the work he is doing. It’s an important step in the evolution of how external recruitment is managed and there are a lot of stages of this evolution to be gone through yet.

  40. Mitch:

    It would seem that you have two main points:

    1)truth is relative, depending on if you like it or not.
    2) two wrongs will eventually, through the magic of evolution, make a right.

    or have made some error in semiotics here?

  41. Bill

    You’ll need to be a bit more expansive then this I’m afraid. What ‘truth’ (perceived or otherwise) are you referring to?

    Plus, if you interpret my comments about First Direct using some less than ethical sourcing tactics and them being reflective of the TPR sector as being ‘two wrongs’ that may evolve into a ‘right’ then yes, I think you ‘have made some error in semiotics here’.

    The point I was trying to make (admittedly in a hurried and clumsy way) was that it is generally better for a company to wrestle back control of the recruitment process from TPR’s. If they do this by mirroring them, then I think that is fairly natural. My assertion is that because companys generally have more to lose (in terms of community relations, stakeholder perception, PR, etch…)than the vast majority of TPR’s, that how they practise recruitment in general and candidate sourcing in particular will be much easier to regulate.

    Hope I made myself a little clearer this time.

  42. Yes, in a way I am Anthony.

    However, much of what I say is related to the TPR’s working in the contingency end of the market. This is where there is the biggest need for companies to get back control of their hiring…..especially in the financial sense. The fees charged are never commensurate with the actual work done….nowhere near.

    Also, when I use the word ‘control’ I largely mean in the sense that they own the process and can take control of both the attraction techniques used and the individual management of the candidates through to short-list and offer stage.

    There needs to be a greater sense of transparency and greater ownership of the clients recruitment problems from TPR’s. Recruiters working in database/job board trawling need to be put out of business and taken over by retained search firms who are willing to develop affiliated practices that partner their clients to also solve recruitment issues lower down the food chain….on a retained basis. In other words TPR’s should evolve into actually ‘consulting’ on how to solve lower value (in terms of salary levels) jobs, on a retained basis for lower fees (because the ‘lotto’ type risk of placing candidates is removed).

    Because this is how I envisage the future of TPR’s in general, is why I applaud Michael Homula’s team doing pretty much what agencies do (and more) for themselves. I believe that the dynamic that he has created here can evolve into a highly effective template for how TPR’s can embrace working for their clients in a different and more effective way. A way that encourages trust, partnership and greater value for both parties.

    Am I making any sense here? I’m concious of writing this down in a hurry, in between doing other stuff.

  43. Mitch, are you suggesting that companies do not have control of their recruiting and the control rests with TPRs? Wouldn’t that be nice.

    Unfortunately I don’t see it. Nobody makes a company use a TPR. I hope they do this through their own choice and because they have a need. Even then they still have control because they can change the TPR at anytime.

    Ironically this whole discussion is about bad practices of one particular Corporate Recruiting function, not TPR’s.

    If bringing it in house encourages this type of tacky practice, then I’m pleased to differentiate it from what we do.

    Besides, the only reason it is brought in house is to save money, not improve quality as we have seen.

  44. Mitch,
    you do make some interesting points, and in a round about way I almost agree with you on what I think you are trying to say.

    It is important for companies to have control of their hiring needs. It is important for companies Not to depend on TPR?s ? Those are valid and great points.
    TPR?s should Not be depended on for every search w/in a company, that would and could become a economic travesty for any company. Companies must make every ethical commitment to fulfill as many of their hiring needs internally as possible. That is truly understandable.

    In regards to your comments re TPR?s and Job boards, Yes I do agree with that comment as well. TPR?s must distinguish themselves from the Corporate Recruiters in regards to the Can Do?s and Unable to do?s to justify their fees.
    My Personal Opinion is that a TPR should not be able to justify a full percent of a fee by modeling the inhouse Corporate recruiters methods or efforts.

    But what I have a considerable problem with in regards to your comments, and I am wondering if you do understand the process or the full aspect of the Role of the TPR is the aspect of Retained Search and the level of search that a recruiter should be utilized.

    Firstly there are many TPRs who choose NOT to do retained search but perform searches as a Retained Model, and will perform searches with the same professional standards and successful track record

    Many of these recruiters more frequently do specialize in their client?s specific field. Thus they do have a brand.. They have knowledge, expertise and opportunity of the field. They WILL depend on their internal database for Networking Purposes which because of their specialty they have made a tremendous number of contacts and associates over the years thus allowing them more leverage and focus. They have a full and consistent relationship with the client, they have direct access to the powers that be, they are requested to do the full cycle of the search, from research, networking, headhunting, coaching, and placement. There Are TPR?s who have gained as much respect and trust, and sometimes even more than some retained searchers.

    These Positions generally do tend to be the companies Core Positions and are often on the higher level of the scale due to the discreet nature of the positions, the specific skills necessary, desired location, precise specifics, the ethical issues presented, or a time restraint factor.

    In these Cases the Fee paid to the recruiter is indeed well justified. The value will come from the efficiency of the search, the industry knowledge and expertise the recruiter brings to the table, the speed that the position is filled, and the talent that is presented that presents the required and desired results for a company. Take for example the Sales Guru who finally closes a companies 10 Million Dollar account within 6 mths after being hired.. Or the Manager who was able to save Millions of Dollars by determining mismanagement within his first Year.

    Now regarding the ethics issues, the problems that are arising is not only due to an inhouse recruiter versus the TPR? Ethics and standards must be performed by all parties involved with dealing with the general public. It is necessary for the companies represented, it is necessary for the candidates and it is necessary for professional image.

  45. Mitch I am pleased to say that as a Contingency and retained TPR, we would never even consider embracing the practices of FirstMerit. If any of our consultants were caught using them, they would be sacked on the spot.

    The practices are not smart or clever and certainly not innovative. They are just bad
    salesmanship and will give everyone associated with it a bad name.

    This is not the way forward but rather devaluing the professionalism of the industry.

    How can these ways encourage trust, partnership and greater value for both parties.

    These practices teach candidates never to trust anything you say again.

    No TPR would ever trust working with FirstMerit and where is the value for the TPR.

    You say yourself (wrongly I believe) that you think TPRs overcharge for what they do, so value for who?

    Your argument is too one sided and I would love to discuss this in much more detail but maybe a different board might be more appropriate.

  46. Mitch, having read your webpage , I now understand where you are coming from.

    You sell an HR software application that will help HR (hence your support of them) to cut out TPRs. It also enables the client to build their own database. So it’s okay for Corporates to build a database but not the TPR.

    Your ‘inflated fees of TPRs moan’ is your sales pitch.

    It’s also interesting to note that your own prefered recruitment process is advertised and then backed up by database candidates.

    Is this any different to the companies working a database or job board that you would like to see out of business? I don’t see the difference.

    Double standards here. I see your affiliation to FirstMerit. Possible client no doubt.

  47. OK … Gotta take a lighthearted poke at all of you….

    I’m wondering whether ‘best practices in recruiting’ include time spent online in neverending debates with other recruiters. 😉

    Honestly, I’m so busy with open positions right now that I have to remember to breathe. … How are you all finding enough time to carry on this neverending discussion?

  48. Tim, apart from typing this at 00:20am right now, I guess it’s a combination of good time management and being the boss 🙂

  49. Anthony

    I do not sell any kind of software – HR or otherwise. What is on my site was put there to support a large contract we were pitching for a while back with a large multinational which involved developing an automated web based recruitment system….which we decided we would build ourselves …..if we won the contract, which we didn’t.

    Maybe people should just accept that there are TPR’s (such as I am) out there that see things more from the clients perspective than from their own. Maybe if more people had this kind of attitude, agency recruiters wouldn’t have to periodically keep having these types of discussions about ethics and principles?

    It’s a concept, albeit a radical one.

    Have a nice weekend everyone.

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