Talent Acquisition has changed dramatically this year, and many employers are now finding that their TA tech stacks are not fit for purpose moving forward. However, in such an economically uncertain environment, unlocking the investment required to update technologies is a real challenge.
So what can talent acquisition leaders do to build compelling business cases for investment to develop their technology strategies for the future?
My guest this week is Tony de Graaf, Hiring Success Director EMEA at SmartRecruiters. As well as working on the technology vendor side of the industry, Tony has himself been a Talent acquisition leader and has some very valuable insights to share on building internal business cases for recruiting technology investment.
In the interview, we discuss:
• The current state of the market
• What are talent acquisition leaders focusing on for 2021
• The need for investment when the willingness to invest is low
• Building business cases around transformation
• Savings and business outcomes
• Technology, sourcing, people and efficiency
• Identifying hidden costs and making savings via tech stack consolidation
• Converting process optimisation in cost savings
• Why time to hire and cost per hire are not appropriate metrics to track
• What with talent acquisition look like in 2 years
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Transcript:
Matt Alder [00:00:00]:
Support for this podcast is provided by Smart Recruiters. Smart recruiters offer an enterprise grade talent acquisition suite designed for hiring success. Future Proof your talent acquisition with a modern enterprise platform with everything you need to attract, select and hire the best talent. Over 4000 leading brands like Bosch, IKEA, LinkedIn and Visa Trust smart recruiters to deliver hiring success with them on a global scale. Visit smartrecruiters.com to take the first step on the path to hiring success.
Matt Alder [00:00:56]:
Hi everyone, this is Matt Alder. Welcome to episode 308 of of the Recruiting Future podcast. Talent acquisition has changed dramatically this year and many employers are now finding that their TA tech stacks are not fit for purpose moving forward. However, in such an economically uncertain environment, unlocking the investment required to update technologies is a real challenge. So what can talent acquisition leaders do to build compelling business cases for investment to develop their technology strategies for the future? My guest this week is Tony de Graaf, hiring success director, AMEA at Smart Recruiters. As well as working on the technology vendor side of the industry, Tony has himself been a talent acquisition leader and has some very valuable insights to share on building internal business cases for recruiting technology investment.
Matt Alder [00:01:59]:
Hi Tony and welcome to the podcast.
Tony de Graaf [00:02:02]:
Hey, good day, how are you?
Matt Alder [00:02:04]:
I’m very good, thank you.
Matt Alder [00:02:05]:
It’s an absolute pleasure to have you on the show. Could you just introduce yourself and tell everyone what you do?
Tony de Graaf [00:02:13]:
It’s a great place to start. So. Hi, I’m Tony, Tony De Graaf. I work for Smart Recruiters. I’m the hiring success director for the EMEA region. As you maybe can hear by my accent, I’m Dutch but I’m located in Berlin. Most for smart recruiters here and as the name already says hiring success director, I help organizations become successful in recruitment in the broadest sense of the word. That’s what I do here and always been a recruiter. Started on the agency side so almost classic career track and then some secondment then to the corporate side. Headed up recruitment for multiple fashion brands in Europe and my latest job before moving to Smart Recruiters was head of talent for Vega, one of the biggest e commerce companies in the Netherlands and actually bought and implemented Smart recruiters. Used it for two years. Literally one thing led to another and now I’m here.
Matt Alder [00:03:09]:
Fantastic.
Matt Alder [00:03:09]:
So you’re the perfect person to to ask this question to so obviously highly disruptive year. Lots of unprecedented things happening all over the World. We’re now sort of towards the end of October. What are you seeing in the market right now? What are employers doing and thinking?
Tony de Graaf [00:03:31]:
Yeah, that’s. That’s a good question. And in terms of a disruptive year, I think this is the most disruptive year in my career so far. So let’s not do a few more of these. I’d say in that sense. But yeah, where everyone was a little bit more in shock in the beginning of the year, companies closing down, everyone going on furlough. I think in this situation you do see that organizations start to little bit better understand the situation of COVID and what’s next. People start to look forward again slowly at least to see how we can navigate into 2021 the best way possible from talent acquisition perspective. Right.
Matt Alder [00:04:14]:
I really get the sense from the people that I’m talking to that that’s very much the stage that we’re at now. The pandemic doesn’t show any sign of ending soon and people are adjusting to the new reality and sort of making their plans, moving. Making their plans moving forward. From the employers that you’re talking to, what are they focusing on for 2021? What do those plans consist of? What’s the conversations that you’re having?
Tony de Graaf [00:04:38]:
I think it’s an interesting one to say it like that. I think for the first time what I noticed talking to customers, that maybe the priorities of the C Suite do not always align with the priorities of the TA leadership. Because before the crisis it is, we need to get talent and just tell me what you need and let’s go. Right. We didn’t even have breathing to think too much about, improving ourselves, etc. And now that you see that the TA suite wants to take this opportunity, we finally have this breathing room to rethink what we’re doing, revamp our processes, revamp our tech stack, just become better with what we do, set ourselves up for success towards the future. And organizations on the other hand, to see that the will to invest of the C suite and spend money on that is lower, lower than it has ever been in talent acquisition over the last few years. So you see that that is a discrepancy that’s happening right now.
Matt Alder [00:05:44]:
And I think you highlight there this really difficult conundrum that’s out there in the market. As far as I can see, this year recruiting talent acquisition has taken this massive digital leap forward. It’s been forced to take this massive, massive digital leap forward with remote hiring, remote interviewing, remote onboarding and digital technologies sitting at the Heart of the recruitment process in a way that they’ve, they’ve never done before. And for lots of organizations moving forward, they don’t necessarily have the right technology platforms in place for, for the future. So obviously that means that they’re having to ask for investment to update the tech stack to support the strategy moving forward. And as you say, companies are unwilling to, to make those kind of investments. What should talent acquisition leaders do in this position? How can they move forward? How can they achieve their objectives? How can they, how can they kind of unlock that investment that they might need?
Tony de Graaf [00:06:43]:
Yeah, it’s a, it’s a very good question. I think that’s literally the million dollar question. Or you hit the nail on the head. And personally I don’t think it’s impossible or in that way harder. You have to just approach the problem from another angle. If you originally have alignment with we need to invest in talent acquisition and you come up with a business case or you come up with a plan, the basic alignment that you need to invest is there. It’s easier to get your budget. But now again, in a market where the will to invest is lower, you need to find, okay, but where is the will of the C suite? What are they open to instead of now just focusing on investment and I think the will to transform and change your organization in the broader sense of the word. This is where the focus lies on the C Suite. How do we navigate post Covid. How do we change our marketing approach, how do we change our production? How do we change how we approach working with people in one place or not or remote, etc. So there is a lot of will to change. But I think we as TA leaders need to, for the first time think, okay, how do we build the business case around this will for transfer transformation and how do we formulate our. Yeah, how do you say that? Our business case towards them. So that we need to transform right now in order to achieve our goals and kind of move away from that investment. So. And how you move away from that initial investment. So we need to make clear what the savings are or what the business outcomes are of that we need to transform right now, if that makes sense.
Matt Alder [00:08:27]:
Yeah, that absolutely makes sense.
Matt Alder [00:08:28]:
I mean, talk us through the process.
Matt Alder [00:08:30]:
That someone might go through to get that kind of data or to get that kind of justification that they can, they can put in that business case.
Tony de Graaf [00:08:40]:
Yeah, that’s a very good one. And I think for the first time we need to really focus on exposing those savings. To say it like that. Right. So we need to convince, let’s say the CFO of the C suite. So you need to connect what you want to change and where you want to invest in. So you need to connect that to that will to transform, as I just said. Right. So I think it’s important to take a look at your entire TA function in the broader sense of the word and go find where you can find those savings. And I think we identified three areas because we have, of course we have more than 4,000 people using our platform or 4,000 organizations using our platform. And we’ve seen a lot of different business cases and motivations and reasons why people have changed. So we kind of summarize that and wanted to give that back to the industry and say, look, these are all the different points that you can take a look at to find your story, to build your business case around. And I think the main three areas are take a look at your tech stack, of course, two, sourcing, and the third one is around people and efficiency, how you do your work. If you look for example, at technology, if you zoom in there, there are three main things you can take a look at. And I think that’s all around consolidation. So what systems can you consolidate into one? And I think you have to take a look here at the total cost of ownership. Because usually they say, okay, you have a central ats, but you have a job advertising tool, you have a referral system, you have a CRM, you maybe have third party AI or scheduling tool. And it’s not only that you have to add all those costs together, but there could be hidden costs that you can take a look at in the IT department or the HR IT department, How much does it actually cost to keep all these integrations running and how do we maintain this and what happens if an update is there? So it’s for the first time STA function. We need to look broader and also at the cost that we create outside of our own scope to see where we can find those savings. So it’s not specifically only in consolidating to one system because it’s more efficient, but what are the hidden costs? So you need to think more as a financial person to approach these problems.
Matt Alder [00:11:11]:
As an example, you kind of mentioned.
Matt Alder [00:11:13]:
Sort of two other aspects there. I think it was sourcing and people and processes. Can you sort of dive deeper into those two as well?
Tony de Graaf [00:11:20]:
Oh yeah, definitely. And sourcing is a really big spend for ta, right? You spend a lot of money in here. And it’s good to take a look at this because the Market has changed and and it’s look to see how can we differently invest in sourcing, right? And I think again here there are a few areas we can take a look at. First I would say advertising, usually the classic one on post and pray that doesn’t work that much anymore, right? And if we just look how we buy exposure at different job boards and job slots or credits, whatever we do, right? But that is more post and spray and I think those times are really, really over. And I think it’s really interesting to see how can you not just drive volume, right? So put your money in a pay per click engine and just focus on getting that volume in. Because just getting a thousand resumes is a problem in itself, right? So how are you going to work through that? How are you going to get the best candidates out of that? How do you make sure you don’t miss anything? So I think it’s important to see, okay, how can we better invest our advertising budget using job posting automation and AI there to make sure that we invest the money only in the places where we need it and maybe even drive down the number of applications but increase the quality. So find the relationship. If you can better target your audience, you have a better application to interview ratio which again could potentially save money. And another one is sourcing. I think agencies again speaking to that, how do you say that will to transform, right? I think it’s a great time as talent acquisition to finally step up and rise to the occasion and claim the ownership of this budget. If you haven’t yet within your organization, you are the TA leader and agencies are really high cost in attracting the right talent and you want to manage those costs for the organization and make sure that we spend it in the right place and we actually save money for the organization. And here it can always help to take a look at the entire fiscal year. So don’t do it from the point forward. Now take a look at the entire fiscal year, compare it to last year, see where maybe it’s already going down due to Covid. But how are you going to make sure where do you want to invest in that it’s doesn’t go up back to the old levels or maybe that you even want to save more. And for some organizations, literally this one can already drive the entire foundation for a business case we had a customer, I think it was collieries in the UK that saved almost over 80% of the agency cost in the first year going to smart recruiters. So there is a lot of money here which you can play around with building your business case. And I think there is a third one, even direct sourcing. And that one is an interesting one because I think it’s a very, very expensive model, especially in the way that we historically leverage direct sourcing. Direct sourcing went from inbound recruitment to, oh, we need to get out there, get everyone a LinkedIn recruiter seat, and we need to start sourcing for our open jobs. But I think we’re using this wrong. I think we need to skip the word direct because sources should source talent for the organization and not just focus on filling the open jobs of today because you create so much waste. Because what happens actually, direct sourcing just for open jobs is the modern version of the 80s call centers. You’re literally going to find the data scientists. You find 100 and you send them all individually a message or you call them, you want to work for us, you want to work for us. You want to work for us. It’s in a super inefficient way to. To find people. And what usually happens is that we are not naturally as good in building talent communities. So we create that waste. What I mentioned in the way that if a role is filled, we kind of destroy or throw away all those relationships and initial contacts that we have created for the most part. So if we need a new role in six months or we need a junior or we need someone else, we just start over. And we might have already talked to that junior person. We might have already talked to somebody who wasn’t a fit today because he or she wasn’t interested. But maybe in six months it is. So we need to move away from direct sourcing and really focus more around building talent communities around the organization and build a strategy around that. Talent communities become the number one source because you will decrease the lead time between the job going live and the first interview. Because you already have this pool of people you can talk to, increasing the speed and hopefully also increasing the quality because people already kind of know something about your organization and the role. So these are a few areas where you can definitely go into in. How do you say that? Finding potential savings for your business case.
Matt Alder [00:16:28]:
You kind of already mentioned some things there that sort of touch on the people and process side of things. But could you sort of talk a little bit more about that as well?
Tony de Graaf [00:16:36]:
Yeah, the people part is also interesting and there’s a lot of in process optimization, I guess. And I think you have to look at where does the biggest waste or time consumption take place within the recruitment process. So for example, in the resume screening. This could be a very interesting one to take a look at because how do you actually do that and how much time are you as an organization going through resumes to find the best ones? And a good, good thing here could be to leverage AI to help you go through this. And one of the resistance that people have against AI is that AI could be biased. But personally I think you should take a middle way approach. So you would say AI should help you prioritize and not AI should solely take the decision on who you’re going to invite or for an interview. But If I have 100 resumes on a role that I need to go through this morning, why, why should I not leverage AI and then letting me sort this row of candidates and say let’s take a look at these 21st. Because there is a higher probability you’re going to find the right candidate here. So and if that on the company wide scale for all recruiters for every role can save so much minutes first resume and minutes per finding the right candidates for a role. And I think there’s also a good thing about AI is we all know in our industry we’ve done some tests, right? The articles are known to all of us sending exactly the same resume and then one with the name Paul or Matt above it and the other one with Mohammed Matt, you’re going to get four times the callback over Muhammad. An AI doesn’t know your name or doesn’t understand your name. So it’s in using and leveraging AI. Yes, of course there are things that you need to think about but you need to utilize it what it does best. And neutral selection and giving me a suggestion where to begin can be super powerful and a super powerful time saver. And I think there is another one around. How do you say that Recruiter productivity. Right Are if what a talent acquisition suite should do is get everyone in the system and work from there. Because if one part of the candidate information is being shared with your business through email, for example, somebody needs to administer that back into the ats. Recruiters need to follow up. Hiring managers don’t come back on with feedback. Feedback is given manually or whatever it is you create so much waste and administrative work there. So a talent acquisition suite should bring everyone together into the system and eliminate this way so everyone can directly communicate better with each other. Not to even mention if anything candidate related is going outside of your system. It’s a huge breach in gdpr. You’re not compliant because you can’t delete that data if it’s somewhere in an email if a candidate is rejected or requests to be rejected. So there’s another reason from a willingness to transform. It’s a risk if you don’t have everything in one system, so everything around making those processes more efficient. And then you can even think about automated interview scheduling, self scheduling, mass self scheduling, because those things can save so much time. And if you can find a time saving of 15% on a monthly basis over all your recruiters, you can convert that to cost saving.
Matt Alder [00:20:12]:
One of the interesting things for me this year is the much tighter relationship that’s developed between candidate experience and employer brand. And really for many organizations, their, their candidate experience at the moment is their employer brand. They can’t show off like nice offices. They can’t have a candidate meet lots of people face to face. So, so really the, the quality of the candidate experiences is the employer brand.
Matt Alder [00:20:39]:
And then at the same, at the.
Matt Alder [00:20:41]:
Same time there’s a reputation thing. So companies are getting huge amounts of applications and if they’re not, they don’t have the right experience to deal with that. It potentially does reputational damage to the company, a very, very difficult time. What’s your view on that and how might that tie into the business case that we’re talking about?
Tony de Graaf [00:21:00]:
I think I even want to raise you one. As you said, it might affect the brand. I think it does damage the brand if you don’t handle your rejections properly. And I think this is in the art of numbers. We are usually TA leaders and we’re chief recruitment and hiring. But if you look at the sheer numbers, we are chief rejection because we only hire 1%, even sometimes less than 1% of the applicants on an annual basis. So what you’re actually doing is rejecting 99% of people that voluntarily took the time to have an interest in you, voluntarily have applied and saying, hey, I like you, I want to work with you and you’re rejected. And I don’t think we need to talk about that. It might have a correlation with how you perceive a brand or negatively impact your customer brand where you work so hard for. I know 100% as a fact that is. And we need to realize that that connection is there, right? So giving, making sure that in your candidate experience, the way that you handle your rejected people, it’s super important. And also in terms of building that business case, I would tie it back into one, that connection to the consumer brand, because ask yourself, if you have a perception of one brand and you have a negative application experience there, do you have Two separate views of that organization or just the one. You just have one view of an organization. It’s not like, oh, I really love this brand. I’m a super fan, but they treated me like they shouldn’t treat anybody else during the application process. But I still love them. You know, it doesn’t work like that. So it’s super important to keep those connected and mention this in your business case to make sure that you can deliver everyone a great candidate experience. And, and I think in terms of cost, I think it’s super important to make sure that you build it up in your business case around the experience and the effect on the employer brand. That’s definitely good.
Matt Alder [00:23:23]:
As a final question, we’re at a point in time of significant change and it’s very clear that talent acquisition is going to look very different moving forward. What are your thoughts on the future? What do you think talent acquisition is going to be like in, in say two or three years time?
Tony de Graaf [00:23:42]:
That’s a really good question. I think we are, personally, I think we are on the verge of an over our next paradigm shift because for me, first we were the recruitment department and then we changed to talent acquisition and because we said we are becoming strategic. But for me personally, talent acquisition is still about acquiring talent, but we just approach that in a process way more strategic. But we did not make the complete step up yet in becoming that strategic partner of the business. We are not always able to connect what we do as a talent acquisition department to business outcomes. And I think this is where the Corona crisis, the global pandemic, helped us rethink where we are and what is our, what is our added value to the organization. And I think we are in the next few years going on a journey in becoming that strategic partner of, of the C suite. And we also need to learn what that actually means. And one of the biggest examples here is how do you measure your own success if you still measure time to hire and cost per hire, Please stop. Because it’s just a race to the bottom. It doesn’t have to do anything how good you are able to deliver the right talent on time and against the right quality. You need to measure your own success around do I deliver the right talent on time when the business needs it and are we able to deliver the right quality and in terms of how much money we spend there? Please approach talent acquisition as you would sales and marketing. See it as an investment. We’re not a cost center. You need to approach us as sales and marketing and see it as an investment. We invest X amount of money to attract these people and is this imbalance in terms of how we are able to deliver it on time against the right quality. So I think we are on the verge of finally taking the first steps in becoming that strategic partner of leadership. And in some organizations you see it already happening where ta because the TA should have a direct line with the CEO. It is one of the first questions I always ask with customers. How often and what structure do you speak to the CEO? And if the TEA leader does not speak on a at least bi weekly basis one on one with the CEO, you still are at the beginning of this journey and this is where you need to go. We will become one of the most impactful departments of an organization or they will be successful or not. So I think really, really, really exciting times at bmtn.
Matt Alder [00:26:24]:
Tony, thank you very much for talking to me.
Tony de Graaf [00:26:26]:
Thank you too for having me.
Matt Alder [00:26:28]:
My thanks to Tony. You can subscribe to this podcast in Apple Podcasts on Spotify or via your podcasting app of choice. Please also follow the show on Instagram. You can find us by searching for Recruiting Future. You can search through all the past episodes@recruitingfuture.com on that site. You can also subscribe to the mailing list to get the inside track about everything that’s coming up on the show. Thanks very much for listening. I’ll be back next time and I hope you’ll join me.
