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Staffing Firms and Talent Pools:The Time Has Come to Sink or SwimBy Andrew Karpie

This white paper examines the emergence of online talent pools as a new, important way for staffing firms to improve their performance as talent intermediaries. The long-standing staffing model is reviewed to understand the appearance of shortcomings as times change (client needs and expectations, technology, candidate

expectations). Those changes in client and candidate needs and expectations are also examined. The question of what online talent pools are—and how they can be beneficial to staffing firms and clients and candidates--is addressed. By way of conclusion, some key observations and recommendations are presented.

Staffing Firms and Talent Pools:The Time Has Come to Sink or Swim

Staffing firms have relied on more or less the same process and business model for 25 years now: sell the agency’s capabilities to clients or their MSPs, receive job orders, recruit candidates, and submit the candidates. If the candidate is selected, the staffing firm earns a placement fee (a % of first year salary for perm employees) or a markup (some % on top of the bill rate of a temp worker for the duration of an assignment).Technology--in the form of ATS, CRM (customer relationship management) systems, and many talent acquisition point solutions--has been added into the mix to optimize these processes (in effect, “paving the cow path”). But the basic model has not changed. While pervasively accepted and considered reliable and safe by businesses, there have been some growing cracks in this model (particularly over the past 5 years).

Businesses—particularly in the face of talent and skill gaps as well as talent retention issues—have begun to raise questions:

• At a time of “on-demand,” why does the process take so long to complete?

• Why do our staffing firms not sustain/continue our relationships with good candidates (whether the gold or silver medalists)?

• Why does our return on the cost of the standard staffing model seem to be diminishing?

• Why does the staffing firm only have access to certain range of talent, when we know there is more out there (for example, through our own referral networks)?

• Why does the technology not seem to measure up in terms of both business and candidate user experience/capabilities?

• Why is the whole process so opaque to us? In fact, we have no visibility into what may be a “sausage factory” and little capability to shape the outcome of the process (submittals) mid-stream.

SUMMARY

QUESTIONING CURRENT PRACTICESDo client businesses find their staffing partners draining?QUESTIONING CURRENT PRACTICESDo client businesses find their staffing partners draining?

Businesses are now pressed more than ever to find the right talent,

engage and make use of that critical resource, and maximize its ROI

on the talent engagement life cycle. Correspondingly, businesses

are realizing that, increasingly, the tried and true staffing firm model

must evolve and leverage new technology in new ways: not to

become more automated and cheaper, necessarily, but rather to be

more effective, able to provide the service and value that is really

needed (i.e., provide answers to the troubling questions above)

In the middle of the second decade of the 21st century, staffing

firms’ clients and candidates are shifting. They both want better

results and to see barriers and dead-weight inefficiencies taken out

of 20th century processes that are still relied upon today.

The current staffing firm model and technology may be hard pressed

to make significant progress in meeting these expectations—that’s

the bad news. But the good news is that with the right kind of

complementary technology solution and new set of processes,

staffing firms can evolve and combine the best of their existing

capabilities and processes with a new way of satisfying both clients

and candidates.

GETTING IT RIGHTWhat do your client businesses and your potential candidates expect from you?

Business Clients

• Access a broader range of candidates

• Improved candidate quality

• Less leakage of good candidates

• Reduced cycle times (time-to-fill)

• More upstream—but efficient— involvement in the

process

• Greater ability to engage candidates through brand and

through other more meaningful ways

• Move beyond the ATS resume heap

• More visibility into the end-to-end process

Potential Candidates

• Direct access to a broader range of opportunities with

specific companies

• Develop real relationships with companies and their

new opportunities over time

• Avoid the hell of ATS job applications

• Get more feedback about the result of expressed

interest (not just dead silence)

• Not just be a resume in a waste basket; have a living

profile with video, portfolio, etc.

• Remain in a talent community after being on- boarded

and off-boarded

Staffing Firms and Talent Pools: The Time Has Come to Sink or Swim 2

Go back just several years and the term or concept of online talent

pools was for the most part unknown to staffing firms and business

clients. That has been changing. There has been a steady increase

in the awareness and interest in online talent pools as a way to “go

to the next level” with the staffing process and address the issues

discussed above. But what is an online talent pool?

“Talent pool”—the term that has stuck--is a bit misleading, as it

suggests a basin in which talent has pooled. While this is partly

true (an online talent pool is a digital platform where talent can be

aggregated and accessed), there is much more to it.

ONLINE TALENT POOLS:

• Can take a variety of forms along different dimensions.• Ownership/Management: At one end of the spectrum, a

business could “own” and manage their own talent pools. At the other end of the spectrum, staffing firms could do the same. In between—and perhaps the value-maximizing option—is where client businesses and staffing firms have, in effect, shared ownership and delineated respective responsibilities for making it all work.1

• Categories/Segments: Talent pools can be established to host specific types of workers or skills, different levels of capability, various other attributes (diversity, veterans, et al).

• Support various potential ways to source and engage new candidates as new talent pool members.2

• Support a variety of tools which can be used to screen and help categorize expectant members according to

• experience, skills, behavioral qualities, etc.• Establish digital/online profiles, “resumes,” portfolios,

availability schedules that can be used for searching,• matching, and business intelligence purposes (e.g., a skill

inventory in a particular talent pools).• Enable a client business’ talent pools to reflect the client

businesses brand and what’s behind it.• Allow client businesses online visibility into and analysis of the

talent in the talent pools.• Enable ongoing engagement of talent pool members in ways

that the staffing firm or the talent pool’s client• business desires: distribute specific content, arrange webinars

or meet-ups, etc.• Enable staffing firm personnel to search for (match), engage

with, screen, and (video) interview individual• candidates.• Enable staffing firm personnel to share (i.e., submit) selected

candidates, online, with the client business• (including all detailed information, recorded interviews,

etc.) and enable the client business to further engage with, screen, interview, rate the submitted candidates (any number of individuals within the client organization to be a part of the selection process, conducting separate interviews and efficiently sharing candidate information, test results, ratings, portfolio, video interviews—all online).

• Prepare selected candidates for onboarding and ensure that at the time of off-boarding the talent remains a part of the client’s talent pool, along with all additional information that

has since accrued to the individual.

1 The optimal scenario is where the staffing firm is a service provider to the client businesses and uses a talent pool enablement technology, along with its existing technology and capabilities, to build and manage private talent pools for each of the business clients. In addition, the staffing firm can establish its own private, shall we say, “talent reservoir,” which is not specific to any given client.

2 For example, this can occur through a normal recruiting process or one where candidates (even passive ones) take the initiative. In addition, a staffing firm can jump start the creation of a talent pool by downloading the grave yard of old resumes in the ATS and breathe new life into them.

A WATERSHED MOMENT FOR STAFFING FIRMSOnline talent pools

Staffing Firms and Talent Pools: The Time Has Come to Sink or Swim 3

Staffing Firms and Talent Pools: The Time Has Come to Sink or Swim

While there is certainly much more that can be said to describe what

is meant by online talent pools, hopefully above points will provide

sufficient clarity of what talent pools are and what their value can be.

In any case, it is certainly clear that online talent pools are not just

basins where talent pools. They are powerful enablers of bringing

talent supply and demand together, and they are a new way for

staffing firms meet changing client and candidate expectations.

There is, as has been noted above, a particular context in which online talent pools are attracting interest—and spurring action. It appears that over the past several years, the initial driver of these developments has been client needs, requirements (client businesses need to go beyond their current staffing processes and the results they deliver). Technology—that has shaped similar models (online marketplaces, on-demand services platforms, etc.)—have made new processes and solutions possible. Finally, staffing firms have realized that talent pools represent a path forward for them—a way to satisfy and retain their clients (by being effective partners, not just commodity suppliers), differentiate from and gain advantage over other staffing firms, and improve long term business prospects.

While online talent pools are leading edge, they should not be mistaken for bleeding edge. In the past few years already, an increasing number of staffing firms have been working with their clients and with technology to put online talent pools to work. For those staffing firms and those clients (many of which are very large enterprises), interests are very much aligned. Talent pools are beginning to happen. Along with this, some technology solution providers to staffing firms are also beginning to explore how they can deliver this capability to thier clients by aligning and integrating with specialized online talent pool technology solution providers.So how should staffing firms be responding to these developments:

• Listen to your clients. If you don’t hear them saying they have an interest in online talent pools, it’s probably you. Listen harder.

• Start to think about how your staffing firm model would change in response online talent pools (client engagement and relationship management, talent acquisition and engagement processes, responsibilities, roles, and skills in the organization).

• Begin to explore how online talent pool technology and your current staffing firm technology solution(s) will come together and support the new online talent pool models and processes for your clients.

• Keep your head above water and look around. Seek out solutions that you think would support your own firm’s adoption of online talent pools and the new service model for clients and candidates. Choose one, do a pilot with a ready and willing client, then expand to other swim lanes.

Online talent pools do represent a watershed moment for staffing firms. Clients, candidates, technology, and savvy staffing firms are coming together and making it happen. For staffing firms, it is a time to sink or swim. Don’t go down with the ship.

NOW WHAT?Conclusions

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About TalentCirclesTalentCircles products and services are totally integrated within the cloud with feature rich talent pools and communities that provide private branding and data ownership for our clients. TalentCircles’ platform enables Talent Connection Solutions for Education, Staffing, Government and Diversity organizations. For more information about how TalentCircles can demonstrate real connections for your candidates and organization, please contact us at http://www.talentcircles.com/contact.php or call 888-280-0808

About the Author: Andrew Karpie is an Advisor to TalentCircles. He works as Research Directory, Labor and Services Procurement at Azul Partners/Spend Matters. Prior to that, he worked as Principal Analyst/Consultant at his own firm, The Research Platform, where served clients including Randstad Innovation Fund, OnForce (now a part of Adecco-Beeline) MBO Partners, CXC Global, Bullhorn software, et al. And before that he was Research Analyst at Staffing Industry Analysts (SIA). In his long career, Andrew has worked as an analyst, manager, and consul-tant with large and small businesses at the intersection of services and technology. He holds a MSc from Carnegie Mellon University and lives in the San Francisco Bay Area.