Recruiting can be boiled down to three critical ingredients that make up the mix: sourcing, screening, and verifying. A traditionally manual function of HR, process automation is snatching the reins from bloated HR divisions and outside recruiters.
According to Bersin & Associates, spending on outside recruiters represented a third of recruiting budgets in 2010; however, due to high commissions (averaging 21% of a new hire’s first year salary), spending halved in 2011 in favor of sourcing talent directly on social networks.
Of course, fancy recruiting IT is imperfect and can not (yet) replicate the intangibles of a seasoned recruiter. Plus, someone has to pilot the software — push the button, as it were. But make no mistake, the tech industry is going after 100% of the pie. And that means cutting out the middleman.
We’re already seeing signs of disruption.
For example, dedicated social recruiting tools such as BranchOut, Jobvite, and HireRabbit are shifting the responsibility of recruitment away from recruiting professionals and toward company employees, who get rewarded for connecting their networks to their employers. In effect, recruiters are being marginalized by collaborative filters within large networks of engaged users.
HR associates are also at risk. From the business owner’s perspective, every hour spent on payroll, benefits, compliance, workers’ comp. etc. is an hour lost on delivering value to customers. So more businesses are outsourcing — not just the HR function but their entire workforce — to professional employment organizations such as ADP.
Recruiters: Billions in venture and acquisition capital is being poured into enterprise software — HRMS, HRIS, HCM, ATS, and other acronyms associated with your future paycheck. Silicon Valley snuffed travel agents a decade ago. Will you suffer the same fate?
Look around the corner and you’ll see that the Heidrick & Struggles of tomorrow is more data analytics than corporate politics. More technician than tactician. LinkedIn “seats” will be filled by computer-science degreed derrières. Recruiting as we know it — a scrappy and gut-driven racket — has reached its expiration date.
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