Reengineering the Recruitment Process

The Covid-19 pandemic has upended many traditional business practices. When it comes to recruiting, the crisis has not so much disrupted as accelerated shifts in the talent landscape that were already under way, leaving many companies poorly served by their current hiring practices. In a period of steep unemployment, it might seem that companies looking to add workers would be in the driver’s seat. But job openings have also been rising in recent months, meaning that competition for top talent remains keen—and in uncertain times, bringing on the right people is more important than ever. A recent study from research and advisory firm Gartner examines those shifts in the workforce landscape and lays out a road map for navigating the new one. The researchers identified three trends that are rendering traditional recruitment tactics obsolete. First, the skills needed in many roles have an increasingly short shelf life, owing in part to more-frequent and disruptive technological breakthroughs. A 2019 survey of 3,500 managers found that only 29% of new hires have all the skills required for their current roles, let alone for future ones. The research finds that in key functions such as finance, IT, and sales, positions filled today will require up to 10 new skills within 18 months. It also documents rising uncertainty about what skills will be needed in current and future jobs as the surge in remote work sparks the redesign or automation of many tasks. Second, the talent pools recruiters have routinely tapped are becoming outmoded. Highly gifted candidates can now be found outside traditional talent clusters, such as leading universities and technical colleges. More and more people are acquiring critical skills informally on the job—or even in their own basements. “Work lulls and layoffs have driven a boom in virtual learning, giving workers new autonomy in developing skills outside their day jobs,” the researchers write. “We Are Seeing Talent Emerge in Unlikely Places” As the global head of talent acquisition at health tech giant Philips, Cynthia Burkhardt oversees the filling of some 15,000 positions a year. She spoke with HBR about how the company is adjusting recruitment practices during the Covid-19 pandemic. Edited excerpts follow. Webb Chappell How has the pandemic changed the talent market? We’ve been talking for some time about the dispersion of skills outside tech clusters, but Covid has accelerated the timeline. People in lockdown have embraced online learning, and now we are seeing talent emerge in unlikely places. One example is a chef whose restaurant had to close, so she taught herself to program in [the computer language] Python. How has this changed your approach to recruiting? Our approach is different for managers and business leaders. For business leaders, we try to speak their language and focus on balancing quality with cost savings. We’ve created a tool that merges HR, finance, and population data, along with information about the labor market, which business leaders can use to build various workforce scenarios. What would happen if I hired 80 architects in Bangalore instead of in Eindhoven? If I used contract workers instead of hiring FTEs? If we hired more talent from universities rather than recruit experienced professionals? This data helps us question our assumptions about the types of workers we need and where to find them. And as a result, we aren’t as homogenous now. We’re tapping into new geographies and more-diverse types of workers to get the jobs done. And at the manager level? We are fortunate to have relatively low turnover at Philips. But that means our managers are not always aware of changes going on in the talent market. We strive to show them that the modern practice of hiring for skills can be more beneficial than hiring for résumés. We try to help them think more strategically, instead of reflexively trying to find a replacement candidate with the same credentials as the person who previously held the job. We say, “Let’s not talk about the job title; let’s talk about the objectives of the job and the skills needed to achieve them.” We also use peers to help assess candidates in a program called Bar Raisers. For example, managers may not have the technical expertise to evaluate certain candidates, so they partner with software developers who test applicants and offer feedback. In doing so, the developers become adept at quickly spotting top talent. How do you hire differently in a candidate’s market? You have to be aggressive, particularly with hard-to-fill roles. You also have to tailor your recruitment approach and communications to the position; an engineer cares about different things than a sales executive does. We equip recruiters with “battle cards” on companies where we commonly look for talent. The cards provide continually updated information about the companies—press releases, Glassdoor and LinkedIn content, stock price, and so on—and highlight the areas in which we are the more attractive employer. For instance, software developers typically prefer to work on a variety of high-impact projects, so Philips built a software center of excellence to rotate developers around the business. That sets us apart from our rivals, and candidates have responded well. Speaking to candidates about corporate purpose is also essential. When the pandemic hit, our work building ventilators and the stories coming from our employees were inspiring. We feel that our corporate purpose of improving lives gives us an edge in attracting top talent. Finally, candidates are increasingly selective about whom they work for, so firms need a compelling “employment value proposition,” which might involve anything from competitive compensation and benefits to career-development opportunities and a reputation for stellar management. Talented candidates, particularly at high levels, are weighing opportunities differently. Factors such as meaningful work and proximity to family have taken on added importance during the pandemic. The freedom (often the imperative) to work remotely and to manage one’s own schedule has increased employees’ expectations that they can exert considerable control over the design of their jobs. Especially in a period of high unemployment, the researchers say, when people are reluctant to leave a secure position and take a chance on a new one, companies need to offer employee experiences that candidates truly value. To adjust to these trends and build the workforces they need, companies should focus on two key courses of action. Hire for potential, not experience. The first step in adjusting to the new landscape is to stop thinking about hiring as a matter of replacing specific employees, the researchers say. When looking to fill a vacancy, too often managers simply put together a profile mirroring that of the person who has left, perhaps tacking on a few new requirements—the equivalent of saying, “I want Sally plus these three other qualifications,” the researchers write. At best, this yields candidates who are prepared for yesterday’s challenges but probably not ready for tomorrow’s. Human resources leaders should push hiring managers to look beyond the immediate needs of their business units and consider what skills the larger organization must acquire to succeed in the future. “The first question HR asks a hiring manager shouldn’t be ‘Who do you need?’ The better question is ‘What do we need?’” says Dion Love, a vice president in Gartner’s HR practice. “HR executives are positioned to drive this conversation because they should have an understanding of long-term talent gaps at the organizational level.” Hiring for skills presents its own challenges, of course, including designing assessments that reliably identify potential. “Employers are asking, ‘How can I test for curiosity? For learning agility?’” says Lauren Smith, also a vice president in Gartner’s HR practice. “They are scanning résumés for indicators such as success in a variety of roles and for transportable rather than industry-specific experience. It’s no longer a question of ‘Is this person credentialed?’” When hiring managers place less emphasis on academic degrees, certifications, and formal experience, they will naturally look beyond traditional talent pools—the second course of action. Recruiters should target the “total skills market,” looking at in-house talent with adjacent skills, candidates whose skills are self-taught, and—especially with the ubiquity of remote work—people in different geographic locations. Recruiting outside high-priced talent clusters can reduce costs. It should also boost diversity, because nontraditional pools tend to contain more women and people of color than are found in the usual recruiting hot spots. Move beyond Ping-Pong and free snacks. It’s critical that companies understand how candidates view them, the researchers say, and if necessary, find ways to boost those perceptions. Prospective hires are scrutinizing organizations’ responses to the pandemic and looking to see how companies have helped—or failed to help—their employees find a comfortable work/life balance. In a survey of 2,800 job candidates conducted as part of the research, 65% reported halting the application process because they found some aspects of the job or the company unattractive. “The increased scrutiny and workers’ demand for more influence…make it difficult for recruiters to rely on their usual incentives,” the researchers write. In managing their employee value propositions, organizations might take a page from the playbook of consumer goods companies. “Firms must understand candidates’ expectations” and craft positions accordingly, “in the same manner in which they tailor their products to customers,” Love says. HR departments at some leading companies hold focus groups to assess job seekers’ expectations, benchmark their offerings against those of competitors, and scour social media and job-review sites such as Glassdoor to understand how they are viewed by current, past, and potential employees. The pandemic is challenging companies to rethink traditional ways of doing business—thus providing an opportunity to reform outdated recruiting practices. “In my conversations with clients, I’ve found that the pandemic has opened their eyes,” Love says. “The world was already transforming, but now the changes are much easier to see.” About the research: “Advancing Recruiting’s Value Through Uncertain Times: Shaping the Workforce,” by Gartner (white paper)

Reengineering the Recruitment Process

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