Recruitment tech set for a seismic shift

It was during the first Industrial Revolution that the foundation of organized HR roles as we know them, were laid down - approach, philosophy, mindset, processes, roles and responsibilities, etc.

Since then, almost every other business function (Marketing, Engineering, Sales, etc.) has evolved to keep up with the changing times and requirements. The talent function, although, has seen significant change over the years, is yet to evolve as a philosophy in the minds of people and businesses. (I have talked about the mindset issues in my previous blog)

‍But the recent phenomena of the ongoing ‘Great Resignation’, coupled with accelerated digital adoption, can become a driving force leading to a change in the mindsets of business owners towards the HR function, particularly talent acquisition.

Let me explain how.

Microsoft predicted that to keep up with the ongoing great digitization, the total number of tech-oriented jobs will grow 5x by 2025. 

‍Therefore, there is a rampant increase in the demand for talent but a huge scarcity in supply. This is a result of multiple things happening together - from not having enough talent with relevant skills in the market, to relevant skills suddenly pivoting to everything digital, gaps in modern education to have fully polished professionals graduating out of college, to the pandemic helping workers realise the importance of health and wellbeing, et al. 

Organizations are almost forced to ramp up their hiring efforts by 5-6 times and make other behavioural and functional changes in their business plan among other things to hire and retain the best talent (something which we have never witnessed before).

Fundamental flaw in the Age Old Hiring Mindset 

Fundamentally, the traditional talent acquisition function was created with an assumption that there would always be an ample supply of talent. As a result, the selection process was usually longer and had too many filters to screen out a large supply of talent and find the best people. Over a period of time, various tools and platforms were created to support such recruitment activities. All of them had one common underlying assumption - there will always be an ample supply of talent. 

This whole construct might be true at the time these concepts were invented. But the fundamental problem here was that instead of taking the construct as an assumption, it was considered as a universal fact that will never change. We had not laid the right foundation for the future — a time when the demand for good talent would surpass the supply.

Fast forward to present times, the global talent shortage is currently at a 15-year high – with 69% of employers globally reporting difficulties in filling vacancies. According to KornFerry, by 2030, the global talent shortage is predicted to reach 85.2 million workers. Companies worldwide risk losing $8.4 trillion in revenue because of the lack of skilled talent.

The hiring function across organizations is not at all prepared to deal with this problem as it violates the fundamental construct on which the entire hiring industry is built over the years.

Additionally, the COVID-19 pandemic has changed the industry landscape completely. With companies shifting to remote working arrangements, HR challenges only intensify further especially for attracting top talent. 

Amidst this talent war, our traditional processes in the current scenario have proven to become counter-productive. Now that our assumption about talent — that there is more demand for quality talent and shortage in supply — has changed, our processes need to change as well. Our traditional recruitment processes need to be reengineered to fit in a new and highly competitive job market.

What is Wrong with Our Current Approach to Hiring?

Problem 1: Apply to our Job on job boards/career pages

Today, even big companies can no longer rely on traditional job postings to find the right talent. In the case of hiring top talent, job boards are already dead. Posting a job on monster.com (or similar platforms) or for that matter your own company website leads to a longer wait for appropriate applications to come in. Top talent is almost never on these job portals, rather they are rarely found in the job market. Generally top talent is already engaged in jobs - that too well paying ones.  Hiring top talent is like cracking a sales deal - you have to make outbound efforts. 

Problem 2: Hiring Process and Interview Structure - Removing Bias

This problem is not a new one. Hiring has always been subject to unconscious human biases. In the present scenario, companies cannot afford to lose talent because of human biases. For that, an effective hiring process and a clear interview structure need to be created - that eliminates subjective decision-making. I would love to see how technology can simplify this problem for us.

Hiring as a function is very similar to Sales.  In both the functions, if you set up the right process with accurate checks and balances and then make sure the processes are implemented, results will start appearing. The trick is to find the right process for each type of hiring position. 

Problem 3: Achieving scale without automation

According to a survey by Yello, 60% of recruiters say that they regularly lose candidates before they are able to schedule an interview. This occurs despite having a dedicated person on their recruiting team (in 56% of such companies) who is responsible for scheduling interviews. 

With the rapidly changing global hiring needs, scheduling interviews and coordinating common available time for those interviews remains one of the biggest operational challenges that recruitment teams face. Back-and-forth calendar coordination, rescheduling or cancelling interviews, and working with multiple stakeholders in different time zones can become a serious administrative burden for recruiters. 

Automation is required particularly where we rely on recruiters for coordination/scheduling. There is an intensified talent war and one cannot afford to lose talent because recruiters dropped the ball during any stage in the hiring process or interviewers were too busy and kept rescheduling the interviews or feedback of interview arrived so late that candidates accepted some other offer - the list is too long. The problem becomes 10x if hiring is global (remote distributed teams)

Problem 4: Missing data

“You can only improve what you can measure”

As hiring is a fragmented function and much of it is carried out manually without using a centralized tool or software, measuring each and every stage of the hiring function itself is a big task. The second issue is lack of flow and integration of data from one stage to another. For eg. capturing the entire lifecycle -  from prospect to Hire, for each candidate.

The next missing piece is analytics and reports ranging from the microscopic level of any stage to getting a bird’s eye view of the entire Hiring function of the organization. Due to data mismanagement and no centralized platform/tool to measure the data, these reports and analytics are completely missing. 

Therefore, nobody knows how their hiring function is working and how it can be optimized to perform better.

‍Problem 5: Poor Candidate experience

Hiring is a two-way process where organisations and candidates invest a significant amount of time on a job opportunity. Candidates are likely to create a positive or negative impression about the company based on their hiring experience as it is their first touch point with the organization. Therefore, it is important to create a hiring process that provides a great candidate experience by providing flexibility in scheduling interviews, giving timely feedback, resolving queries and keeping the candidate engaged. 

The problem is that companies expect the recruiter to provide this experience manually and that too at scale. There is a need for a proper structure and processes to ensure a good candidate experience.  

Problem 6: Stakeholder management and engagement

Multiple Stakeholders , including external third parties, have a high involvement in the hiring process. It is important to ensure a smooth management of these stakeholders. At present, more than 60% of a recruiter’s time goes into mundane and repetitive tasks for eg. coordinating interview slots, scheduling interviews, creating calendar requests, sending reminders, asking for feedback etc. Beyond a certain scale, it is impossible to manage these tasks manually. ATS tools are not built for the purpose, hence they will never be able to fill this gap. 

How we see the future unfold for Hiring tech

So far, technology innovation in hiring has resulted in half-baked solutions by fuelling those functions in hiring that are more costly than others. For eg. There have been a large number of tools that provide automated assessments that save an interviewer’s time (which is considered more expensive than the recruiter’s time). In present circumstances, this hypothesis doesn’t hold true for the following reasons :

1. It is difficult to hire and manage skillful recruiters

2. The hiring process works like a pipeline - any bottleneck at any stage will have the same impact on the overall hiring output.

There is a huge scope of innovation in the hiring function from scalable personalized sourcing to AI based solutions for interviewing and assessment. We will talk more about the future of Recruitment tech in our next blog. 

Overall, we are going to witness the transformation of the Hiring function from being manual, redundant and opaque to becoming data driven, automated and efficient. External factors like the Great resignation, post pandemic shifts and Great Digitization are providing a forceful push to expedite innovation as well as adoption of these innovations. 

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