Goldteam's Blog

What role do the traditional High Street agencies play in today’s recruitment landscape

Online is the way forward in finding candidates, but what role do the traditional High Street agencies play in today’s recruitment landscape? The internet has changed the business forever, and in the recruitment sector this has meant that recruitment agencies, particularly the traditional High Street ones have had to find their feet in this new world.

Kris Jarzebowski, Chief Executive Officer (CEO) of CareerJunction in South Africa, tells us that as the business model of pure advertising in newsprint has changed to online, and the draw of these job boards bring more and more candidates to apply, so the role of the recruiter and specifically the recruitment agencies have to change, as they move from a contingency business process to a value added service. He explains that recruitment agencies serve employers of large and small companies across the globe and with varying degrees of success as they strive to deliver top candidates to employers in the shortest possible time. After all it is the ‘early bird that catches the worm’ in the recruitment business and gets the commission! However, now that employers can do it themselves, use sophisticated filtering tools, and candidate tracking through their own recruitment processes, Jarzebowski asks the question why use an agency at all?

Well, Human Resources (HR) personnel are not always the best recruiters and besides, they are also busy with so many more HR issues such as managing unions, staff policies, job grading, management and staff motivational programmes and so on, says Jarzebowski. He says this is where the recruitment specialists step in – agencies! However, the agencies have to provide more to earn their money now. Jarzebowski says: “Online has now levelled the playing fields for all high street agencies and so it is the business savvy that will survive by introducing new and dynamic ways of serving their client – the employer. The new game for the recruitment agency must be about helping the employer to not only use the new online tools to which the employer subscribes, but also adding value to service levels – using other techniques such as Web 2 channels; thorough candidate screening using industry standard tools; reference checking at all levels from driving licence bans to PhD education level checking – becoming the professional recruitment arm of the HR Officers and removing these long tedious but necessary checks.” Jarzebowski still believes the High Street recruitment agencies play a major role to employers, providing they change their ‘old’ approach and embark on a Value Added path which embraces the online tools and services being delivered at an ever faster rate to employers. He says they need to ensure they are not made obsolete because of technology, rather that they become part of the technology solution!

Traditionally, recruitment firms are still spending between 50%-75% of their time scouting for new business, with the majority of the time cold calling businesses, says Virginia Raemy  from talent puzzle.com. Raemy comments: “This is very time consuming and costly. Recruitment agencies can add value to the candidate search but they need to spend more time focusing and filtering potential candidates rather than simply focusing on new business.” Raemy believes recruitment agencies can only hope to compete in the future if they improve the overall quality of CVs they submit to employers.

Lesley Nash, Managing Director  (MD) at Changeworknow sees agencies as playing a role in saving valuable time and providing recruiters with a shortlist, but also says well designed online application processes, with good screening questionnaires will take away the stress of managing volume and of doing the initial sift. Nash says such questionnaires will provide a ready -made shortlist that is far more reliable and unbiased than an agency looking to meet targets at month end.  Nash adds that the technology will also help recruiters build a qualified talent pool of their own on which they can draw as future vacancies arise.

Regarding recruitment agencies, Nash comments that the internet has helped to expose the good, the bad and the ugly, and has given corporate recruiters a greater choice of how and when they use high street agencies.  Nash can therefore see a niche in the market for the traditional agencies, saying: “The good agencies are not afraid to embrace the principle of less is more and will submit fewer, candidates who hit the target.  A trusted agency who hits the bulls-eye every time with excellent candidates will over time become recognised as adding real value to an organisation.  And companies are prepared to pay for high value-add services and are prepared to commit to long term relationships. Time will always be of the essence, resources will always be limited, and some roles will always be hard to fill.  And this combination plays to the high street agencies’ strengths; provided the corporate recruiter makes the right choice.”

The consultants that will thrive in this competitive market are the ones with a truly consultative approach, says Derek Pilcher, MD of TheLadders.co.uk. He perceives this as providing job-seekers with valuable advice on career progression and in-depth knowledge in navigating  the job search process (not just on getting the job), and having a trusting and close, if not exclusive, relationship with recruiters so they can provide the right candidates for the right companies. In Pilcher’s opinion, the strongest recruitment consultancies are increasingly those that position themselves as ’trusted advisors’ to clients’ HR teams and communicate their clients’ company cultures, ethos, brand and offering to prospective candidates. He says these are also the consultancies that place great value in first identifying their talent pools amongst the job boards relevant to their niche and then build effective working relationships with those jobs boards to fully optimise the applicant flow.

Though candidates enjoy the control afforded to them by handling their career search and managing their own move, like all trends Frank Varela, CEO of mypeoplebiz would expect there will come a point when the balance swings back, largely driven by candidates who will be looking for a more human touch. He says that his business’s type of platform has had an impact on the 350 UK recruitment agency members on his site: “I have to say that I can see the good agents prospering and doing well. I have found that with our platform, because we do the business development and the employers are posting their vacancies directly on to the site, recruiters who may not be the best business developers, but are really good recruiters are thriving and making a lot of placements. Ordinarily, these type of recruiters, whose efforts are focused on the candidate relationship and matching to the right job as opposed to sales; would be less recognised by the agency, but they are now doing deals and their more “salesy” but rather less knowledgeable colleagues are not doing as much. With the technology now available, I expect to see recruiters who focus their business on service to do well and those who focus on low value, low prices to struggle, after all even if you make one placement at £30,000 salary at a knock down 10% that is still a £3000 fee but you need to make 15 placements at £200 fixed fee to make £3000, so the rush to embrace volume rather than quality and charge appropriately is a challenge for the recruitment industry and online recruitment. Getting the pricing structure is important.”

There is still a plethora of possible recruitment strategies available in 2010. As long as consumers believe the fee is worth the services provided, this range of choice is one thing in online recruitment that might just stay the same!