Paradigm shift in personnel acquisition: Talent pools and active sourcing for sustainable recruiting success

There’s no doubt any more that almost every company is having to deal with the lack of skilled workers and specialists — and for many of them this has been an issue for some time. Each time I gave a speech this year, I posed a question to the audience: “How many of you have already had trouble filling open positions with suitably qualified applications?” On average 50% of all audience members raised their hands in response to this question, which gives me reason to suspect that the roots of the problem aren’t related to individual companies, but rather are systematic in nature. It seems to me that many HR pros continue to harbor the recruiting fantasy that amidst the enormous number of applications the right candidate will somehow emerge. Even more so: most companies haven’t  successfully implemented the key changes that the majority of recruiters are asking for to improve their recruiting methods and processes.

The current situation on the recruiting market demands change

Many recruiters, and I believe almost every HR manager, share the view that the recruiting market is currently a candidate’s market (meaning that demand [companies seeking candidates] outstrips supply [candidates seeking jobs]), forcing companies to come up with new ideas and approaches to winning the battle for scarce talent.

At the same time, the majority of recruiters are still working with processes originating for the period where supply outstripped demand (more applicants than companies seeking to fill positions). These processes are in many cases strongly promoted through inflexible software and are oriented toward filtering one or two perfectly qualified candidates out of a mountain of applicants. Unfortunately,  many companies are now finding that this approach has become outdated and no longer produces the recruiting results they’re seeking.

Active Sourcing as a forward-thinking recruiting method

The fact is that  to score enough talented candidates to make a decision at all, companies need to rethink their recruiting strategies. The term “active sourcing” describes recruiting concepts that work to appeal to and engage interesting candidates well before their potential application to the recruiter’s own company. For companies active on the current labor market, the early establishment and long-term maintenance of relationships with desirable candidates is decisive. If I as a recruiter don’t take steps well ahead of time to present myself to my desired candidates and to convince them of the value of my offer, then they’ll go to companies that are doing the same thing better than I am. Meaning: those who don’t switch to active sourcing and instead rely solely on applications will sooner or later only obtain the candidates who haven’t received job offers from the competition via active sourcing.

Active sourcing requires the long-term establishment of talent pools

Through this article I’d like to make a proposal for a process for acquiring personnel that uses active sourcing as its fundamental methods. My reference here is Gero Hesse’s article that questions the relationship between employer branding, HR marketing and recruiting. I see the sequence much the same way Hesse does, with corporate branding, employer branding, HR marketing and recruiting. However, I’d add the step of active sourcing, however, after HR marketing and before recruiting:

Active sourcing as an integral component of personnel acquisition (click to enlarge)

With regard to the significance of and differentiation between employer branding, HR marketing and recruiting — in all cases from the viewpoint of the target audience and of the company — I once again must refer to Gero Hesse and Queb.

Active sourcing means that companies build up and maintain talent pools from which they then recruit. Suitable candidates whom the company gets to know over a period of time (such as interns, contacts at recruiting fairs, participants in events, professionals from other companies, etc.) should be taken into talent pools. Recruiters will no longer be sorting through applications and conducting assessments, but rather becoming active much earlier. They become active sourcers and are primarily responsible for cultivating relationships with selected candidates. At the end of the process, they can compare candidates in the pools and their skill sets with the requirement profiles for open positions. On the whole, active sourcers read far fewer applications and conduct fewer interviews because they already know their candidates.

Active sourcing also holds a major benefit for the candidates as well. They get to know their potential employer over an extended period of time, which makes the experience more real to them. The association with a talent pool can extend to months or even years, with candidates having numerous chances to learn more about the company behind the HR marketing measures (such as at seminars or company events, as part of a mentoring program, through internships, personal conversations, etc.).

From the company’s perspective, talent pools represent the basis for projectable active sourcing. Talent pools link in well with existing HR marketing measures. Candidates should ideally be drawn directly from HR marketing activities and invited to suitable talent pools, where they can potentially be won for the company. Active talent pool management also has the key benefit that the candidate can be a member of a talent pool even during ‘inactive’ periods where they are not actively seeking work and thus wouldn’t be submitting applications. This leaves the door open for that same candidate to be acquired at a later date by the company.

Active Sourcing means key organizational changes

All of this means that reactive recruiting needs to become active recruiting. Even those who would describe active sourcing as just another trend must, at the very least, accept that their own existing, primarily reactive recruiting organization requires serious reconsideration. To implement active sourcing consistently within the company, changes are required in at least three areas.

  1. The first is a redefinition of the role of the recruiter. In particular talent pool management skills are not typically a focus for recruiters. They are however, essential for an active sourcer who needs to identify suitable candidates and awaken medium to long-term interest in the candidate for the company.
  2. Second, established processes must be broken up and in some areas completely reversed. The work of the recruiting department must be much more oriented toward the establishment and maintenance of contacts and much less toward processing received applications and conducting interviews. This also means that new software is required, especially for administering talent pools and communicating with its members.
  3. Finally, the performance benchmarks must be redefined: The emphasis is removed from how many applications a position receives and how many persons are invited to interviews. The much more important question centers on the size and quality of the talent pool and the measures to keep these pools thriving and vital in the long run.

We at IntraWorlds are deeply involved with these and similar considerations at the moment. This is a result of our current intensive work and on our plans to improve our IntraTalents solution. We are constantly discussing the perspectives for active sourcing with our customers, a roster that includes the BMW Group, KPMG, die Fraunhofer-Gesellschaft and Adidas. I’d be glad to hear your perspectives and opinions as well. How do you evaluate the importance and potential for active sourcing, both right now and in future? What challenges do you see ahead in this regard for your own company?