THE TALENT ACQUISITION

CHALLENGE 2009

Recruitment trends and issues

impacting today’s leading organizations


CONTENTS
Introduction .............................................................................. 3
The Challenge............................................................................ 4

Recruitment Process Outsourcing .............................................. 7

Weathering, Even Leveraging,

the Downturn ..................................................................... 9

Look to the Future ................................................................... 11

About the Sponsors ................................................................. 12

CHARTS
#1: “Environmental” impacts
on recruiting ....................................................................... 4
#2: Internal recruiting practices .................................................... 5
#3: Use of technology solutions .................................................... 5
#4: Most commonly outsourced
recruitment processes ........................................................ 7
#5: Most common reasons to
outsource recruitment processes ........................................ 7
#6: Most common reasons to outsource
recruitment processes ........................................................ 8

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Talent Acquisition Challenge | 3

INTRODUCTION

As the world faces unprecedented demographic, economic and competitive
challenges, recruitment and retention remains a top concern. Recognizing
the critical role talent acquisition plays, leading organizations are maintain-
ing focus on attracting and retaining talented people. To assist forward
thinking employers in how best to overcome these recruiting challenges
and capitalize on current opportunities, the Talent Acquisition Challenge
Report was developed by three industry thought leaders: Pinstripe, a lead-
ing provider of talent acquisition and retention services; the Human Re-
sources Outsourcing Association (HROA), the definitive independent mem-
bership organization for HR outsourcing; and TPI, one of the preeminent
sourcing and advisory firms.
The Talent Acquisition Challenge Report leverages data from:
 The HROA/Pinstripe/TPI global survey conducted in the Fall 2008
 Pinstripe HR Leader Polls conducted across 2008 from predominantly
mid-sized organizations
 TPI Prevalence DatabaseTM ongoing data collected from Fortune 1000
companies
 The RPO Summit, in Washington, DC, in December 2008
A summary of the insights from those efforts, as well as the collective
knowledge of three of the sector’s leading organizations, follows.

The result is newly released data compiled from multiple sources over a
year-long period that captures the pulse of the talent acquisition market in
2008 and identifies trends and opportunities for 2009.

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Talent Acquisition Challenge | 4

THE CHALLENGE

Talent Paradox Historically, “currently employed individuals” have taken a conservative

Today, demographics and the global economic slowdown are significantly
impacting hiring and talent management – in both negative and positive
ways – producing a talent paradox. This talent paradox is created when
organizations face skill shortages in some geographies and business units,
at the same time that they experience reduction in force and an over-
whelming surplus of applicants in other areas due to high unemployment.
Leading HR practitioners interviewed at the 2008 HROA RPO Summit in De-
cember, expressed uncertainty regarding the current economic climate and
its impact on recruiting. There was a shared belief that in difficult economic
times, while many unemployed candidates may be available, currently em-
ployed individuals are reluctant to risk changing employers.
wait-and-see approach. Housing market uncertainty inhibits relocation de-
cisions; financial stability of the new organization and looming severance
packages all create hesitancy among talented employed candidates to start
a new endeavor.
With unemployment approaching the highest rates in decades, recruiters
face new challenges that require an overhaul of:
 Recruitment marketing strategies (Why advertise at the same rate with
reduced requisitions and more candidates available?); and
 Selection and hiring processes (With an overwhelming number of appli-
cants for some positions, deploying tighter selection criteria during a
variety of steps in the hiring process is recommended).

1 “Environmental” impacts on recruiting

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

Economic downturn
Skill shortages
Multiple generations in the workforce
Increasingly aggressive competition
Globalization

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Talent Acquisition Challenge | 5

THE CHALLENGE

Recruiting as a “Marketing Activity” 3 Use of technology solutions

Many organizations have neither an active recruitment process in place nor
SOLUTION % ENGAGING
recruiting professionals who see recruiting as a “marketing activity.” In fact,
many organizations lack even the most basic recruiting strategy, relying Utilized sourcing from the web and social networks 80%
instead on a practice of “post and pray.” Utilized job boards 68%

For those who have embraced proactive talent acquisition strategies, the Added additional internal recruiting staff 45%
most commonly used are web solutions (including social networks and job Added or enhanced technology 42%
boards), advanced technology, and resume banks.
Utilized resume banks 41%
Added contract recruiters or recruiting assistance 35%
None 5%

2 Internal recruiting practices

0% 5% 10% 15% 20% 25% 30% 35%

Post and pray with no plans to enhance

Post and pray with plan to improve

Basic with no plans to enhance

Basic with plan to improve

Proactive

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Talent Acquisition Challenge | 6

THE CHALLENGE

The Holy Grail: Metrics

In every C-suite across the nation, there has been a growing call for one
thing: RESULTS. Across all functional areas, C-suite executives are looking
for ways to measure challenges, opportunity, and success. Human re-
sources and recruiting are no different. Talent acquisition and talent man-
agement are presented with the challenge of delivering compelling business
cases to gain support for investment, if not to defend their very existence.

Key questions HR leaders need to be able to answer include:

 What is the cost associated with each new hire?

 What is the cost of recruiting, hiring and on-boarding a candidate?
 How do traditional response methods (i.e. job ads) compare with the
latest proactive techniques (i.e. social media)?
 Which current manual processes are best replaced with automated and
self-service options?
 How can recruitment and HR managers effectively answer these pressing
questions?
 Are we strategically prepared to meet our short- and long-term goals?
 Do we have, and if not how do we find, the talent to face our future?

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Talent Acquisition Challenge | 7
RECRUITMENT PROCESS OUTSOURCING
As with any business challenge
where efficiency, cost savings and
innovation are needed, leaders
face the build-or-buy question. Is
the most optimal choice internal
reengineering, outsourcing, or
status quo? For some, recruitment
process outsourcing (RPO) may be
the answer.
The fastest growing segment in
the HR outsourcing arena over the
past several years, RPO is
garnering a lot of attention and
increasing market size. Long term
HROA research has indicated a
significant uptake of recruitment
outsourcing between 2005 and
2008, from as few as 17 percent of
organizations to as many as 47
percent outsourcing some portion
of their recruitment processes,
and continued growth is
anticipated.
4 Most commonly outsourced recruitment processes
As illustrated below, organizations
utilize outsourcing for all aspects 0% 10% 20% 30% 40% 50% 60%
of the recruitment process and
Background checks/drug screening
find cost and efficiency benefits
from those business choices. Reference checking
Candidate screening
Organizations have a wide variety Ad creation and placement
of reasons for outsourcing recruit-
Name generation and sourcing
ment processes, and there really
Recruitment technology
isn’t broad consensus on the main
reasons. Most commonly organiza- Job posting distribution
tions say they outsource recruit- Temporary help
ment to decrease time to hire and Recruitment marketing/ad strategy
lower the cost of recruitment. The Selection/assessment testing
next most common reasons cited
Interview scheduling
are increasing both candidate
volume and quality.
5 Most common reasons to outsource recruitment processes
0% 10% 20% 30% 40% 50%
Decrease the time to hire
Lower the cost of recruitment
Improve candidate quality
Increase candidate volume
Gain access to technology
Improve market outreach
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Talent Acquisition Challenge | 8

RECRUITMENT PROCESS OUTSOURCING

RPO Impact
Outsourcing parts of the recruitment process and utilizing end-to-end RPO
have a positive impact on the quality of candidates an organization can
attract; half of respondents to the HROA/Pinstripe/TPI Talent Acquisition
Survey agreed that their RPO programs have improved the quality of
candidates their organizations attract. This finding is important as
improving quality of candidates is included in the top three reasons
companies turn to RPO. A significant number of respondents also say that
RPO helps their organizations gain competitive advantage and bring about
positive change in their organizations.

6 Most common reasons to outsource recruitment processes

0% 10% 20% 30% 40% 50%

Improves the quality of candidates our organization attracts

Helps my organization gain a competitive advantage
Brings about positive change to my organization
Is part of our talent management strategy
Benefits candidates as well as hiring manager
Helps my organization reduce costs
Strengthens the role of HR with senior management
Is necessary for my organization to operate in today’s economic climate
Is the solution to the managing the fluctuations in staffing demands

Agree
Disagree

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Talent Acquisition Challenge | 9
W E AT H E R I N G , E V E N L E V E R A G I N G , A D O W N T U R N
Finding, hiring, and retaining the right people remains a challenge through
all economic climates.
Difficult economic times may lead to limited resources across some func-
tions and an overwhelming number of candidates in others. Although re-
cruiting may be down, the number of people looking for a job has in-
creased. As a result, there are more resumes to consider, more candidates
to interview and more responses to compose, regardless of the decision on
their candidacy. Unfortunately, contrary to the perception, recruitment
teams may be busier than ever during downturns especially if the resources
in the Recruiting Department become part of staff reductions and realloca-
tions.
Encouragingly, organizations that take time to build infrastructure during a
downturn will be better equipped to ride out the cycle and will be better
positioned when things improve. In order to do so, it is necessary to take a
step back to evaluate and revise workforce plans, talent acquisition proc-
esses, and technology approaches.
1. Evaluate Workforce Plans
Whether companies engage RPO providers or take on the recruitment proc-
ess internally, now is the time to build in efficiencies, maximize existing
tools, eliminate waste, innovate, manage vendor relationships, and estab-
lish strategic partnerships.
2. Review Talent Acquisition Processes
Leverage Your Hidden Goldmine
One of the most commonly overlooked tools in any organization is the ex-
isting database. A real goldmine of information, the resumes collected by
recruiters and HR staff over the past years should provide great leads on
passive and active candidates.
Tap Your Current Employee Pool
Identify individuals who have been interested in gaining experience in other
functional areas and who would be willing to wear two hats during difficult
times. For the right employees, the current climate might provide real op-
portunity to gain much needed and desired experience in other areas.
Strong employees will appreciate the opportunity for long-term career
growth, and it will demonstrate how much you value them.
Review Your Funnel and Revise Your Processes
Companies may have fewer openings, but will have many more people ap-
plying, which will significantly increase the amount of time spent screening
and responding to applicants. This will exhaust HR teams and could actually
increase effective cost per hire. This is the right market to adopt a high-
volume recruiting model for processing a high volume of candidates, in a
time of low job requisitions.
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Talent Acquisition Challenge | 10
W E AT H E R I N G , E V E N L E V E R A G I N G , A D O W N T U R N
3. Upgrade Your Organization’s Technology Tools
The technology available to find and communicate with candidates has be-
come more sophisticated and is core to both active and passive candidate
recruiting. This includes: job posting distribution (like Viper and eQuest);
posting aggregators (including SimplyHired and InDeed); SEO (search engine
optimization) offered by Jobs2Web; and, candidate search and marketing
technology like AIRS SourcePoint. These types of technology aids are in the
portfolio of any proactive recruiting department and RPO provider. Most
integrate easily into many standard ATSs. If they aren’t integrated, then a
download/upload or import/export is available to connect the technology.
The marketplace is moving toward a comprehensive technology solution
that creates a one-stop-shop for talent acquisition where integration is on
one platform. HR management technology consolidation goes beyond tal-
ent acquisition to encompass a full suite of services for talent management
that is available to employees and managers on a self-service basis. These
include workforce planning, talent acquisition, performance management,
learning management, payroll, and succession planning.
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Talent Acquisition Challenge | 11

LOOK TO THE FUTURE

Even (or perhaps especially) in an economic downturn, the demand for tal-
ent remains a top concern for the nation’s leading organizations. Organiza-
tions that seize opportunities presented during downturns – not only to
attract and retain top talent, but also to build a recruiting infrastructure
that is flexible and scalable – are most likely to thrive in any economy.

Now is the time to innovate and embrace solutions that will drive future
growth.

The market has shifted from a scarcity to an abundance of candidates in a

very short time, so organizations need to adjust accordingly to be certain
that they aren’t overspending or spending in the wrong areas. However,
this is a great time to be “out in the market” as the competition for talent is
much lower. To take advantage of it, companies should remain active but
identify cost saving initiatives such as renegotiating existing relationships
with providers; no one should be paying last year’s rates!

Protect Your Brand! The few companies hiring will receive hundreds or
thousands of resumes for every job they post. It is critical that they incorpo-
rate tools so that they don’t miss good people or alienate future prospects
and customers. This is particularly important for consumer brands, as every
applicant is also a possible customer or patient.

As bad as it may seem, remember that every downturn yields winners and
losers. Companies that are strategic are most likely to weather the current
economic climate, and may even emerge as more efficient and successful
organizations.

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Talent Acquisition Challenge | 12
ABOUT THE SPONSORS
Known for innovative and uniquely effective
sourcing of talent, in addition to executing on
customer-focused process improvements
Founded: April 2005 by an experienced team
of HR, HRO and RPO leaders and industry
veterans
Total Employees: 136 FTEs; Average Recruiter
experience is 5 1/2 years; Pinstripe Leadership
Team (12) average HR Leadership experience is
over 12 years
Headquarters: Brookfield, WI; 32,000 square
foot Service Delivery Center; 9,000 square foot
training facility
Target Markets: Commercial - Global 5000;
Healthcare - Domestic Healthcare Systems
www.pinstripetalent.com
 Worldwide sourcing advisory firm
 Nearly 400 advisors
 Completely independent and unbiased
 Provide sourcing advisory services in:
 IT
 HR
 Finance
 All other business functions
Our goal is to help our clients optimize their
business operations through a combination of
insourcing, shared services, outsourcing and
offshoring.
www.tpi.net
The HROA is the definitive independent
organization for all those who purchase,
provide, or participate in HR transformation
and outsourcing. Our membership
encompasses over 7,500 HR executives,
including the largest 50 buyers, the top 30
providers, the leading sourcing advisors and
attorneys, and the best thought leaders in HR
Transformation. The HROA brings its diverse
membership together to set standards and
practices, provide peer networking, and
maintain a robust curriculum.
For additional information about the HROA or
to join, visit www.hroa.org.
www.hroa.org