Recruitment of the new era

Hello, Everyone! My name is Monica Ciesielska, and I welcome you all to "HR on Wings" podcast. We will speak today about the recruitment of the new era. Let me start by introducing my guests. David Nirenberg, Managing Partner at SKR Partners. Hi, David!

Hi Monica!

And Mitch Berger, CEO at the Howard Sloan Search. Hello, Mitch!

Hi Monica. Thanks for having us.

Happy to have you on my podcast, Gentlemen! Both companies, SKR Partners and Howard Sloan Search, are specializing in executive search recruitment of middle and top-level management. SKR is operating in Canada and Howard Sloan in the United States. On top of that, all three of us - Mitch, David, and I, are partners at IMSA Search Global Partners, which is an international executive search association, operating across 27 countries via 50 offices and five continents.

Okay, so let me briefly introduce the topic we wish to discuss today. We'll be talking about the changes in the recruitment process and the trends we predict for the future. The question we wish to answer is how has recruitment changed? Let's start with a few facts. What was already confirmed is that the pandemic has significantly changed the recruitment trends. What I have in mind is that more companies adopted virtual recruiting technologies. They shifted the talent attraction force to remote candidates, considered internal talent pools, and focused on diversity, equity, and inclusion, which is a really hot topic nowadays. What I've read in the results of the research, which was done by LinkedIn among 150 recruitment professionals, is that virtual hiring is here to stay.

If we speak about my personal experiences, well, unfortunately, I need to confirm these assumptions. The candidates prefer meeting online, especially at stage one of the recruitment process. Doesn't mean to you that we can forget about meeting candidates in person? I mean forever. What do you think?

I think that will lead to a less than optimal process. There is something to be said for face-to-face contact, and there's certainly something to be said when you're assessing leadership capability as to nuance. And part of that nuances can only be picked up by being in the room. Virtual can certainly perform some key functions in the early stages, but in the later stages, when it's all safe and that, I guess, is the unknown factor here, when it's all safe, is not as good. And so I don't know why most organizations or anyone would choose to take a less than optimal way to proceed to assess leadership talent, which you're depending on to make the major substantial contributions to your business.

Yeah, but don't you feel that it's exactly what the candidate expects, that they expect to be met online? Especially that we, I mean us, the executive recruiters are usually the first stage, and afterward, there are many more stages to come meeting with the supervisor, meeting with the board. And considering that we are still in the middle of the pandemic, maybe they simply feel safe about it.

There's nothing we can do during the pandemic because priority number one has to be safety. So during a pandemic, some compromises in all sorts of business activities have to be done. But I do think that we have to be careful as to what we attribute to the Pandemic that will be doing forever and what we're just doing through this period of time. And I think meeting in person is something that needs to happen post-pandemic. But currently, again, safety is taking priority. We can't do that.

Monica, I'm taking the complete opposite approach. I think it's fabulous. I don't think it's unfortunate. I think it's absolutely, incredibly amazing. I think it allows faster hiring, ease of hiring, and expands where people could be working. So no longer do you have to be commutable. And I think there are so many incredible advantages to being able to hire people, interview people, and have them work remotely, that it's kept the economy thriving. And as you can, we know in recruiting, the demand is off the charts. The candidates right now, it's the highest level of candidate demand I've ever seen in my lifetime. And I think there's incredible efficiencies in what's happening. And I think it's been an incredible breakthrough for the recruitment industry and the ability to attract and hire candidates quickly.

Don't you think that we are losing something, like a kind of human touch? Are we able to evaluate the candidates properly? I mean - online?

I think you definitely lose something, but the gain is so much more in speed and where the candidate could work and come from. When you weigh the pluses and minuses, it's huge in the plus column. And it also doesn't mean you can't meet the candidate at some point. But as far as handling the process, getting people through the process in a quick, efficient and amazing way, I think it's incredible.

But would you divide it and say that it's more important to meet, let's say, C-level executives and managers - in person and specialists and IT developers - online? I believe that in each case we are trying to assess different things and we have more time for evaluation in the executive self process than in IT recruitment. I mean, both processes are completely different. It's completely different to recruit a director over an IT specialist. So maybe we should have a different approach in these two different cases?

I think it's BP thinking and not AP thinking. I think it's before pandemic and then after the pandemic started. So I think people have to expand their minds, embrace the reality of what is and see it for what it is. The advantages are immense, and I think it's what's allowing some companies to thrive and grow and bring on the multitude of people that are necessary as their choices of where they can come from have increased dramatically. So I think we have to expand our minds. And you can still see the candidate, you could still view them, you could still have that interaction with them. Yes, you can touch and feel them, but you can certainly see it doesn't have to be overflow, it certainly can be visual and I think it's incredible and it is what it is right now. So you either embrace it or you have negative and complained thoughts about it. And to me, embrace what is, take advantage of the advantages of it and it doesn't mean you can't meet people. But what we've seen is that people can do their jobs incredibly well and build world class teams across many countries having not met each other in person.

David, would you like to add anything?

Well, I think all things recruitment comes down to a very basic business equation and it's the return on the investment. So if you're hiring a program or analyst, the expense of hiring that person is much lower and the level of responsibility is also lower. So it's okay to make compromises in the process and the nature of speed and at the lower levels. And organizations, as Mitch pointed out, the competition to be fast and get there first in terms of candidates is vital. So you're just trying to figure out, okay, how's that going to work. But if you're hiring a senior executive leader and you're going to be paying them well into the six figures and then plus short-term and long-term incentives. I think that speed is the enemy of good because you need somebody that's going to be exceptional and they're going to be driving a big mission that's going to deliver substantial returns to the organization if they do it well and if they fit well. And in those cases, rushing to judgment because the market is frothing a little bit is not the best move because I don't know too many people that will buy a house only after seeing it on video.

I don't know too many people that will buy a car by watching a video of the car. Because to most people, buying a house or a car is two of the bigger investments they'll make in their lives and they want to get in the car and they want to walk around the house, they want to see the yard, they want to look where the furnace is, they want to look how the house is built. So I think we have to apply these basic principles and try and do them to the best we can. But speed and trying to get through things fast because we'll lose candidates, it's a reality in today's marketplace. But we have to put together a compelling enough proposition for a great candidate that they'll hang in there and not just make the first judgment or the first offer that crosses their desk because that also speaks to their judgment. And that's something we should be referencing and assessing too, is like if you're just looking for the first offer to get out of where you are now, then that says something about your leadership.

The next quite visible trend is that location no longer limits the talent pool. The willingness of many employees to work remotely is making the world open, and it's eliminating borders. What I instantly hear from the candidates is that they are being approached by recruiters from all over the world and that they are receiving interesting job opportunities from different locations. It was obviously possible before to approach the candidates from all over the globe. However, the employers were not that open to remote working. And now we can easily observe that even at LinkedIn, there are so many job offers, even at the high managerial level with added note - remote work. Much has changed, don't you think?

I agree. The leader you get today in 2022, even if it's the same person, is not the same person that we were talking to in 2020 before the pandemic. So the world has evolved, and work from home is compelling and won't go away. So if you rule out work from home, you will be ruling out a good percentage of top caliber candidates, and especially you'll be ruling out the vast majority of top caliber candidates, the younger they are. So this is now an established norm. There's proof of concept that productivity can be high and outstanding, and we have to embrace it because it's a great trend and it's great for organizations because, as you said, Monica, it opens up the talent pool to a worldwide North American wide. You can pick wherever region you're in. It opens up the possibilities immensely. So it's all good, but we have to embrace it. And we can't look at the world as pre-pandemic and post Pandemic. We have to look at the world as what's the best practice to get to where we want to go and try and cling to that and not just say, okay, this is what we do now. Because some of what's come out through the pandemic isn't great, but work from home and the flexibility of that and people being more fully engaged and having better quality lives, that's got to be great for everybody.

I agree with my friend from the north of the border. You have to embrace the reality of what is. And the location has really become a non-factor right now for many companies that understand that a person doing their job doesn't matter if they're across the street from their office or in another country and that they could do a great job. It's very person specific. Unfortunately, we're all social animals and like to be human touch, and there are some people that can or a fish out of water working from home, but the majority of people have adapted to it, can do it, and many have embraced it and never thought they would. So, yes, I agree that people could do their job from anywhere in the world at this point.

The next point, which I think is worth discussing is also the job descriptions. This is my observation that the job post has significantly evolved. I mean, employers are including accurate salary ranges and job descriptions that are honestly capturing their expectations towards the candidates. They are describing the goal which is supposed to be reached in the short and long term. And what I personally find valuable is that they also say a lot about the company culture as well as the company's approach to diversity and inclusion. I think that brings a much wider perspective to the candidates. Do you see it as well?

Diversity has always been vital. Diversity of ideas, diversity of people. The more ideas you get around the table, the better the outcome will be. So diversity, although it seems to have come more into vogue in the last few years and more people are being responsive to it, this is something that should have been happening in great organizations and with great search firms well before the pandemic. And so the more diverse our employee profile looks like, the more successful the organization will be. And there's enough quantitative data that's been produced over the last ten or 15 years that clearly shows that organizations that are more diversified perform better than their peers that are less. So I think there's nothing to discuss because the data is in and we should all embrace it because we all want to be in the best place we can possibly be.

I agree with David, and David's point that I heard was regarding dei and companies should do what's right when no one's looking. So a lot of companies have now embraced it, but everyone should have been doing what's right when it wasn't in vogue. And yes, I believe culture matters. And the challenge with job postings right now is the demand is so far exceeding the supply that it's seemingly not doing a great job of attracting the right candidates to organizations.

Yeah, going further with this, I believe that those times when it was enough to knock on the candidate's door having a simple offer that was meeting the candidate's requirements, I seriously believe that those times are gone for good. Today. The companies are trying to sell themselves well to the candidates because the candidates expect much more. I also believe that the candidates want to understand what the company has to offer, not only in terms of the job opportunity itself but also in terms of the company's attitude with diversity and inclusion. And also is it a sustainable and eco-friendly workplace? Do you also observe that it's important to the candidates to consider the employer that is doing something valuable to the natural environment?

I think it's important, but I think the attitude towards this should be spun the other way, is that I won't go work for a company that I feel is doing harm. So if companies not diversified, if it's not friendly to the environment and the place it is, and practices business in that's not a place I want to be and so this has been going on. When I started in Search I got a phone call from a tobacco company to do a search for them and I chose not to do it because that wasn't an area that I felt comfortable working in and that I wanted to support and I think today that boat has long since left the harbor and if the company isn't doing its very best to do good to the greater world then that company is going to have bigger issues and it's long term horizon will be limited.

Clients should always have been selling the candidate. The candidates care greatly right now what clients stand for and that's something that the client has to really tell the story about and that's a big part of what candidates why candidates are joining, what's the purpose of the job and the company, what do they stand for and yeah, that's a very important criteria right now in attracting the right talent to your organization.

Well, it's not that easy anymore, right? I mean the labor market has really changed and as you already said, Mitch, the demand exceeds supply.

The candidates have hand. I mean we're seeing candidates that when they're presented saying this is the amount of compensation I'm looking for and then a month later when it's time for the offer they already have offers above what they mentioned they were looking for and now their new number of what they would accept has changed since the start of the interview process. So that's the world we're living in.

Yeah, exactly. Do you observe that the industry represented by the employer matters now more than ever? What I mean is that industries and functions such as technology find themselves in high demand above other more traditional industries. As professionals look towards the future the company prefers to bound the notes with the company which is representing a quite stable business. I'm thinking about pharma, medical devices, the food industry, or technology as was mentioned.

I think for Generation Z and generation even they're more interested in nature. It's not the industry that attracts the nature of the challenge and I think smaller start up entrepreneurial or more flexible, more agile organizations are the ones that appeal to them. I think most people I know when I go on to university campuses and I talk to business students they have very little desire when you ask them to put up their hands what they want to do. They have very little desire to go work for a consumer packaged goods company or a bank or an insurance company. They have huge desire and appetite for startups social media organizations where they feel they can have an impact and that they feel the organization is also having an impact on its customers, clients in the world at large. So the world has turned whereas a look for stability in a 20 year career was the thing that many university graduates looked for 20 or 30 years ago, and that's now obsolete.

I couldn't agree more. I think industry has become much less important. I think purpose matters. I think startups are embraced. I think we've all heard the stories about these companies we've never heard of, gone and done great things. And stock is very attractive to candidates, just like candidates. It used to be that you wanted a candidate who had been with a company a long time. Now the clients want candidates who change jobs so they could have a diversity of experience and knowledge in them. So I think challenge stock, purpose. These are the things that matter now and are able to attract people.

I would like to come back to the topic of diversity. John Shobo, a best-selling author and managing partner at Workplace Intelligence, a New York City-based HR research and advisory firm. He recently said, in 2020, 70% of job seekers said they want to work for a company that demonstrates a commitment to diversity and inclusion. Well, having that in mind, what do you think? What is the role of the recruiters around the topic of diversity? What should we do about it?

Well, I think as represent, yes, we're paid by our clients, but also we have to give them market data to candidates. And if clients still haven't found the way that they have to be more relevant in today's world to what the sense of purpose is and what the societal mission has to be behind their organizations, then I think we have to educate them that they will be limiting their candidate pool and their upside potential by not going to a more progressive and thoughtful way forward. And I think that's how simple it is. I think we're probably not there now, but there will come a time when people will refuse to do business with people that they don't believe have a sense of purpose or aren't making good in the world. So we're not there yet because the dollar still talks. But I think increasingly what I'm seeing and hearing from sort of societal norms and desires of anyone under 40 is that if they don't sense that the organization is up to good and we can define good in many different ways, then it's of no interest to them. It doesn't matter what the role is.

Are you being asked by your clients to include 50% of men and women on the short list of candidates or people of a certain age or people from different cultures? Are you being asked for that?

We're definitely being asked for that. But I think the issue is here is that when clients ask for that, they have to build up an ecosystem within their organization that also supports that. So it's one thing to say we want to hire more women, we want to hire more people of color, we want to do this, we want to do that. This is how we want to diversify. But you have to build a greater ecosystem. And so just saying we're going to go to a certain number and we're going to get there within this time frame is not the best way. There is systemic racism and barriers in many organizations, far too many organizations that make the onboarding of diverse candidates very difficult. And organizations have to look beyond what we've hired somebody that meets this criteria into what are we doing wrong in our organization that doesn't create a welcoming and warm environment and a place where someone can grow their career. And I think there are bigger issues there that go beyond executive search. But I think if we're going to be good moral citizens of the world as executive search partners, we've got to highlight these things.

It's just not enough to say, I want to hire X for this search. That's what I want to see in the shortlist, it's, what are you going to do to support X when you bring it in? And how much is there in the organization now? Because you can't just fix by hiring. You have to fix by building the right kind of support and foundations within the organization. It's a very challenging and difficult task. So it's not as simple as some organizations see it. Well, we'll just do this. We'll make these three hires, and that'll help put us right. I think that's a naive assumption, and I think it's not one that will breed success.

Sure. I believe that the candidates, we owe it to candidates, to be candid and transparent. And a lot of how you do that is by before you're reaching out to candidates, you're investigating the company, you're asking the right questions and you're learning. And we owe it to candidates to be candid and transparent. And for clients, we need to be fishing in the right pond to find the right candidates for them. And I do believe that new hires can help change culture, and that's an incredibly important piece to the puzzle.

Do you also agree that the company's reputation matters in the hiring process? Employer branding is a key to a successful recruitment process, right? So the employer should become a company the candidate wants to get involved with.

I say reputation matters. At the same time, it's okay to say, we understand their reputation is not what someone would want. At the same time, would you like to be a change agent for this kind of an organization? Here's what they're striving to do. Would you like to be someone who can change the culture of a company and that's being candid and transparent?

I agree with Mitch. I think the world is not a perfect place. And so everyone's job is to sort of pull in and try and help and make it a better place. So you have to be honest and open with a candidate as to what the challenges are for the organization they're looking at. And no organization is perfect. So there's always going to be issues and they have to either feel that those issues they want to deal and manage them or feel that, no, it's not a great fit for them.

Yeah, but then do you think that it's also our job to inform the candidates about difficulties? Of course, if we are aware of any issues,

Absolutely. I've always seen it as my job as an executive search practitioner to point out to my clients the strengths and the weaknesses and the areas that will cause some strain in the organization of all the candidates. And it's also my duty and responsibility to inform the candidates on the strengths of the organization and the weaknesses.

I was always acting the same way. I think it's a correct path which we should follow. I mean, we cannot forget that we are dealing with people. Those people are having families. We are then trying to convince them to take this new professional challenge, but they should know all the cons and pros. I mean, they should know everything before they make a decision to change the job.

Monica, like our partners throughout the world in IMSA, we embrace that. We're executive search consultants and the right consultants consultant is a consultant to both parties and our goal is not to make a placement ever. Our goal is to create the right matches. In order to do that, you have to tell the good and you have to share the challenges. And no challenges should be left off the table. So each party understands the opportunity and the challenges that they're walking into.

Yeah, I totally agree. Professionals are thinking about their purpose, which was already mentioned by me, they need a job that is providing a positive and measurable value to them, to society. They just need to see the sense. And what has been observed since spring 2021 in the United States is a great resignation that involves employees that are searching for their purpose. It was said in the media that 19 million Americans already left their jobs only by July 2021. Furthermore, according to Microsoft Research, 41% of the employees around the globe are interested in changing the job or even in totally changing their professional lives. They are becoming freelancers. They are launching startups or changing the company to one which is meeting their expectations. Mitch, could you comment on this phenomenon? What is happening since last year?

Well, it took a lot of look when it first happened, the pandemic. When Covet first happened, most people who went to work from home thought they'd be back in the office full time in a couple of weeks. And here we are years later. It took companies a long time to figure out who and what they wanted to be. In the old world, prepandemic people used to say don't resign until you had the right next job. At the same time, the demand for talent has changed all that. There are plenty of people who are resigning because their company is not aligned anymore with the beliefs of what the individual wants and many companies are still trying to figure it out. So the work office home life balance is a key factor as well as companies that were able to adapt to the changing world of working from home and embracing it and continuing to build the right culture or not. So there are many companies in the United States that have made people come in regardless of what their health and family situation is. I think people are understanding and companies are understanding that you need to embrace what is right now. And I think a lot of companies have changed their thoughts. But as far as not leaving a job until you had a job, that's a fallacy for a while now.

Now, looking at the changes in the recruitment process, which we have just discussed, is there anything that could make the recruitment process more efficient? Is there anything that can be done differently? Can we streamline any part of this process?

No. The simple answer is no because it's too important to streamline. Because the more you streamline the more likely you are to hire the wrong people. There's a great survey that Gallup just put out and they looked at 27 million employees and something like 300,000 work units over the last 20 years and they found out that over 80% of the time companies hire the wrong person to be a manager at any leadership level, at any management level. So streamlining time is vital in finding the right leaders. And I draw the analogy and some people sort of grid and smile at it, but I think it's true. If you look at the divorce statistics you are more likely to end up not being successful pairing up with somebody for life in a marriage the less time you spend with them before you agree to get married. So people that have longer courtships are more successful in maintaining their marriage and so time gives you a chance to get to know the other person other side, the other factors at play better to make a more informed decision as to whether it will work for you. That's true of both the organization and the employee.

So streamlining, there's lots of things we can do to streamline. We can be quicker to respond to people, but cutting meetings shorter, doing less work to judge leadership. Talent is falling and will result in not good outcomes and not good outcomes when you hire somebody and they fail or they're just not successful, they're just okay. That's an expensive cost and burden to an organization. Anyone you bring into an organization should be exceptional. Because you're trying to say to the people in the organization, we have to go outside because this is the kind of talent we needed and we couldn't find it inside. That person has to shine for the organization to appreciate and respect the decision of going outside rather than promoting or developing within.

Well, I agree a lot with what David said. What I would say is hiring slowly does not improve success of the process. Hiring and I agree with David as far as time, but people get mistaken about time. Time to me is, as David was saying, length of interviews, number of people getting to meet that person. I'm not saying short and mad, but what I'm saying is when you look at the start date of when you got the introduction from that candidate to when you hire that person, slowing that down does not increase success. What increases success is getting the amount of time you need by the right people in the shortest period of time. So it doesn't mean that you delay the thing and make it last a long time. You have to be very efficient. You have to communicate promptly. And at the same time you can hire fast by having the right amount of people get to know that candidate in a much less amount of time. Amount of days. But time in getting to know that person is still a very critical way.

That's really well summarized. I agree. The organizations can't string out a recruitment process for weeks and weeks. In terms of meetings, well, we'll bring them back next week and then the week after, they have to clear the table to meet people as quickly as they are available to meet. And they have to go through that process with the rigor. So it's a commitment from the organization to spend the time with strong candidates to best assess who will fit them as quickly as possible. In today's world, as Mitch noted, that can be weeks, right? So you might be meeting with a candidate six times in a period of six work days.

What kind of skills should not only executive recruiters, but recruiters in general, what kind of skills they should embrace referring to changes in the labor market caused by Covid. Is there any?

That's an interesting question, Monica. I'm not sure there's any. What I'm struggling with is the cause and effective because of covet. I think what's changed is that we're looking for new skills that a lot of organizations don't have the innate capabilities yet developed to assess people on. So how can you assess whether do you have the ability and do you know how to assess somebody to see if they can be an agile leader? How do you assess for empathy? How do you assess for developing purpose? How do you assess for building a collaborative environment? How do you assess for those things and ensure that you're getting what you need? And that's being missed. I think we have to look at the way we assess candidates because the old days of asking people, give me an example of you developing a strategic plan. Don't cut it anymore. Because candidates have great access to information. And from reading a job description, 99% of intelligent candidates can understand what the competencies are and start preparing examples that will illustrate they have those skills. So the old behavioral event interviewing process has been turned on its head because you're not getting real data anymore. You're getting prepared data that can be enhanced and changed because they can see what's coming and what the questions are. So the questions have to be a lot more thoughtful with a lot more rigor. And you have to challenge people's ability to manage and to think in a dynamic, fluid environment and how they would look at the business and the issues and the people involved.

I think that's very well said. And the executive and the people today and the leaders have to be very organized and that's a skill that's really important and embrace technology. And those are some things that are really critical in today's world, in addition to everything David said.

On top of that, I would add maybe, well, considering how people were infected during Covid, in many ways, economically, mentally, and how the recruiters sometimes are forgetting that they are dealing with people and they don't provide any feedback, or what's worse, they disappear during the recruitment process. And us, I mean, the executive recruiters, we could say that it doesn't apply to us, right? We don't do that, but it happens. In general, the candidates are talking about it. So, considering that I would add compassion and empathy to the list of required skills. Let's end our conversation by predicting the future. What would you point out as the prediction of changes in the hiring process for the next year?

I think that the number one thing will be the way that we go about assessing candidates. We will rely on more leadership assessment tools to peel back some of the layers of the onion of what the candidate is and isn't. And we will use those same leadership assessment tools to test people within our client organizations to see what the profile of success actually looks like when it's tested. So if you find if on the senior leadership team there are five stellar exceptional performers and you test them, you have some idea of what succeeds in that organization. Quite often organizations describe what a good fit is as something that an actual fact isn't what a good fit is in their organization. So I think using more leadership assessments will help establish a better norm as to what great really is in the organization. And I think assessment techniques to learn about candidates at a test and to examine their critical thinking, their moral compass, their agility, all these kinds of things that we've been talking about throughout this call will have to be advanced and will require more training and more sophistication on recruiters partner whether they're talent acquisition teams within an organization or whether they're executive search partners outside the organization, for the most part, the bar is very low in the assessment industry, in my opinion.

I think it's very important for companies to hire a Pied Piper, someone that people can rally around, someone who has amazing bedside manner, someone who has vast thinking, someone who's incredibly flexible, and someone who has no boundaries in their mind. And I think it's paramount for Executive Search consultants to really get to know these candidates so they can understand which ones will be the game changers for the companies that they're representing.

Thank you for sharing your thoughts. Well, I think we'll end here. Thank you, Mitch and David, for this interesting discussion about the recruitment of the new era and for sharing your insights on the labor market in your countries. Thank you.

Thank you, Monica, for having us.

Well, Monica, you lead IMSA Worldwide in an amazing way, and it's no surprise that you thought of putting this together. And thank you for having David and I participate.

Thank you. It was a pleasure to have you on my podcast.