Start: 20 Rules for Recruiting in the Creative Age

Time to start a new adventure. First published on March 1, 2005, this will be part of the frame of the future conversation.

Does your company operate in the creative age? Does it attract customers, defend its market position, deliver value and create investor return by monetizing human creativity? Then the answer is a definitive "yes" - your business operates in the creative age. If you are recruiting in the creative age, then you might want to consider the following:

20 Rules for Recruiting in the Creative Age

1.) Talent is more expensive than capital.

2.) A portfolio is more important than a diploma.

3.) Recruiting is a sales function, not an administrative function.

4.) Recruiting is a fundamental business driver.

5.) Recruiting must run as a separate P&L within the business.

6.) Talent is defined by production, not opportunity ("Real artists ship").

7.) A requisition is a non-critical financial document designed to manage risk.

8.) Great recruiting organizations design for reward.

9.) Bad recruiting organizations operate to manage risk.

10.) Quality is not a measure of satisfaction. Quality is a measure of the frequency and range of variation to a specification.

11.) The recruiting "specification" is a job description. There is never scientific rigor applied to the creation of job specifications. That is why recruiting can't be held accountable for quality. That is also why recruiting needs to be accountable for organizational development.

12.) Talent is not a person. Talent is a capability.

13.) Talent is not an employment contract. Talent is the delivery of the capability.

14.) In every recruiting sale there are three customers: the company, the client (hiring manager) and the candidate. All three must be closed simultaneously.

15.) Time to fill is a worthless statistic. It measures administrative cycle times. "Strike zone" is the appropriate measure - hitting the defined specification for delivery of talent.

16.) Cost per hire is a worthless statistic. It measures neither the contribution of good recruiting nor the cost of bad recruiting. This is why recruiting must be a P&L function.

17.) Management should have no insight into recruiting budgets, nor any control over any recruiting headcount or line items. Recruiting must be profitable. Period. How that gets done is up to the recruitment management, as long as it is consistent with regulation and the organization's values.

18.) Recruiting does not exist for the candidate or the client (hiring manager). It exists for the company.

19.) Most companies have no idea how to define, defend, attract, integrate and manage talent. So recruiting generally exists for something that isn't even there: the company's understanding of the value of talent.

20.) Talent is more expensive than capital. This simple fact will change the world in ways not envisioned since the 1800s.

Comments

[Amitai Givertz]

The slumbering giant awakes.

[Ted]

Wow, this is the best recruiting article I have read in a long time. Love everything about it - especially how the tone isn't the typical "we love talent" fluff, but rather, "talent is a business decision." Great stuff.

[Michael Homula]

So glad you are back...have to put you back in the list of people to read on my blog.

I especially love #5. Having led a recruiting team that was not in HR and ran as a P&L I can tell you this works and is a game changer.

[Puf]

Great post, thankfully, more and more companies understand we are sales people in a sales function.

[Colin Kingsbury]

Great to have you back, John!

[Malcolm]

I like #2, a portfolio is much more important than a diploma. Experience really goes a long way. A diploma is important but really doesn't show what you can accomplish in the work force.

[Will at Virtualjobcoach]

I apologize if my counter-points are counter-productive but as someone who has hired a lot of people, your rules seem to be, well wrong.

1.) Talent is more expensive than capital.

You seem to be talking apples and oranges here. If I substitute 'skill' is more expensive than 'cash', that doesn't really tell me anything. Isn't talent 'human capital'?

2.) A portfolio is more important than a diploma.

Agreed, but not sure you can use this practically in this environment. If you post a job listing, the 'diploma' is a simple filter to use. Does it mean that you may lose talent because it doesn't have a 'diploma'? Yes. But being a recruiter, you have to constantly assess an over-supply of candidates. The diploma qualifies the look at the portfolio. Yes, there are stupid people who graduate from top-schools, but as an indicator of 'talent' the diploma is, on average, very useful.

3.) Recruiting is a sales function, not an administrative function.

Actually, recruiting is both. The admin function is finding an acceptable pool of talent and screening them. Once a pool is identified there is still admin to get to the 'select' candidate. Selling only happens, in earnest, when you have a candidate you want to capture.

4.) Recruiting is a fundamental business driver.

Don't understand what you mean by 'fundamental business driver'

5.) Recruiting must run as a separate P&L within the business.

Hmm, Why? How do you measure 'profit' in the recruiting function? In general, recruiting does not have a say in who is ultimately hired. They have an impact at the beginning of the process, but not in actual staffing. You could make the argument that "recruiting is the reason that we hit our sales goals", but you would probably be laughed out of the room..

6.) Talent is defined by production, not opportunity ("Real artists ship").

Do you mean 'potential'? Opportunity is a strange word to use.

7.) A requisition is a non-critical financial document designed to manage risk.

Not sure what you are trying to say here. A 'rec' is a job-statement, and it certainly is critical for senior executives. Furthermore, while it technically is not 'a financial document' it does have some significant financial implications.

8.) Great recruiting organizations design for reward.

Not at all sure what you are saying here.

9.) Bad recruiting organizations operate to manage risk.

How does recruiting manage risk?

Will (to be continued)

[Will at Virtualjobcoach]

10.) Quality is not a measure of satisfaction. Quality is a measure of the frequency and range of variation to a specification.

I think you are defining consistency, not quality.

11.) The recruiting "specification" is a job description. There is never scientific rigor applied to the creation of job specifications. That is why recruiting can't be held accountable for quality. That is also why recruiting needs to be accountable for organizational development.

I don't know why I would ask a 'standard' recruiter to do organizational development for me. Yes, there is no science behind job-descriptions but there are certainly 'quality' metrics that are and should be used to assess a recruiter's performance.

12.) Talent is not a person. Talent is a capability.

Again, apples and oranges. You can't have 'talent' without the person (we are not talking animals here). I believe that talent is the manifestation of skill. Capability is the potential for results.

13.) Talent is not an employment contract. Talent is the delivery of the capability.

So talent is the delivery of talent (using your logic in 12)?

14.) In every recruiting sale there are three customers: the company, the client (hiring manager) and the candidate. All three must be closed simultaneously.

Not sure how you can define a 'close' and not have it simultaneously? Isn't closed the result of the process when there is a decision either to accept or reject?

15.) Time to fill is a worthless statistic. It measures administrative cycle times. "Strike zone" is the appropriate measure - hitting the defined specification for delivery of talent.

Can't TTF be a proxy for market conditions? (and isn't it useful as such?)

16.) Cost per hire is a worthless statistic. It measures neither the contribution of good recruiting nor the cost of bad recruiting. This is why recruiting must be a P&L function.

Agreed (except the P&L part) but unpractical. Recruiting is about potential 'contribution' is about value-add. I don't think I have ever seen a top-new-hire thank recruiting (or the company for that matter). Recruiting is expected to bring in quality candidates. Or am I missing something.

17.) Management should have no insight into recruiting budgets, nor any control over any recruiting headcount or line items. Recruiting must be profitable. Period. How that gets done is up to the recruitment management, as long as it is consistent with regulation and the organization's values.

I must be missing something big because, again, I disagree. Who should have control over recruiting's budget if not management? How do you measure the profitability of recruiting?

18.) Recruiting does not exist for the candidate or the client (hiring manager). It exists for the company.

But I thought you said that recruiting's customer was the hiring manager? How can you 'exist' without a customer?

19.) Most companies have no idea how to define, defend, attract, integrate and manage talent. So recruiting generally exists for something that isn't even there: the company's understanding of the value of talent.

Very much agree on the first point, the second no-so-much.

20.) Talent is more expensive than capital. This simple fact will change the world in ways not envisioned since the 1800s.

Back to my argument for #1. The value of capital is either the base interest rates or the opportunity cost of an investment. In general, I can always buy talent. That very transaction puts a price on talent.

Wow, sorry about the length, I love the subject matter.

Will

[Matthew Hinde]

I love the article.
Really hits the key points - why most firms don't get this is strange. AND - to put my two cents in, or two pence in my country - Good or bad economy, the top talent is still the top talent - hard to find and harder if you lose it.

[Ginni Garner]

This is a great article and one that should be available to many CEOs. I don't agree with every item, but you open doors to seeing recruiting as a strategic business function.