As startup and expansion stage companies grow and begin to scale their teams, they all face a similar quandary: hire a staffing or recruiting agency to source talent for them, or hire a corporate recruiter in-house?
There are merits to both options, depending on your hiring needs.
At OpenView Labs, we currently have two full-time recruiters on board (including myself) and we act as corporate recruiters for the expansion stage companies our firm invests in. We source top talent, interview candidates, and perform due diligence, all with the specific goal of saving our portfolio companies time and money.
In recent years, hiring recruiters in-house has become more and more popular. After all, at a reasonable median salary (about $63,000 per year in Boston according to Salary.com), a corporate recruiter can cost less than the total annual sum that some companies pay in recruiting fees.
We believe so much in the value of corporate recruiters that we recently launched a search for a third member of our recruiting team at OpenView Labs (if you happen to know a rock star corporate recruiter, please pass along our job posting). Meanwhile, several of OpenView’s portfolio companies have recently added — or are looking to add — a corporate recruiter to their growing teams too.
But how do you know if hiring a corporate recruiter makes sense for your business?
There are three key things to consider:
- What is your current and future hiring strategy? Laying out that strategy will answer a lot of questions for you.
- Do you expect a larger volume of hires in the coming years? If you anticipate an increase in your hiring volume, then you may see significant value in hiring a corporate recruiter.
- What type of employees will you be hiring? If you’re focusing mostly on entry-level employees that might require a smaller recruiting fee, it may make sense to use an agency. If you’re looking to recruit at a variety of levels including more senior positions, then an in-house recruiter may be able to save you money.
If answering those questions pointed you toward hiring a corporate recruiter, then the next step is to truly understand their role and how it’s evolved over the last few years.
Recently, I read an article on ERE about that topic. According to the article’s author — respected HR consultant Dan Kaplan — there are three recurring corporate recruitment trends which have been taken from the CEO’s perspective and their recruiting needs.
Here they are, along with some of my own thoughts:
Corporate recruiters are salespeople.
We are not going to strong-arm someone into joining the companies we work for, but when we are trying to recruit A-players, we must remember that they are likely looking at several options.
Corporate recruiters need to be more strategic, have a keen business orientation, and possess the ability to sell prospective employees on the company. To do that, recruiters need to understand the corporate culture, business goals, and talent needs of their company in order to attract the right employees.
While that “sales” label doesn’t sit well with some HR professionals, talent acquisition expert Louis Kadetsky lists the ability to sell as a core competency of all great corporate recruiters.
The corporate recruiter’s role is being elevated to talent management.
The business need to both recruit and retain employees is growing exponentially, and therefore the skills and experience of a talent manager are critical when scaling a business.
Recruiters will be judged on who they invite to the corporate front door and how the employees they recruit ultimately contribute to the company. And as important as it is for recruiters to identify and hire top talent, their ability to effectively retain that talent has become equally critical, a recent Harvard Business Review study revealed.
Developing new data analytics is required.
Cost-based data (how recruiters show their value and progress) is quickly being replaced with quality-based cost analytics. The percentage of new hires who are performing at or above average (based on peer review) and how many are still with the company after one year are now better indications of a recruiter’s success than the cost to hire X number of employees.
The new data should reflect how the performance of new hires and their longevity with the company supports business growth strategies.
Without question, the role of the corporate recruiter will continue to evolve as market conditions change and the economy improves, so it’s important to stay up on any new trends.
That’s particularly true for companies at the startup and expansion stage. After all, businesses at this stage of growth often need to be more creative to acquire top talent and are far less capable of absorbing bad hires and surviving high employee turnover.
So, what makes the most sense for your business? If you’re thinking about hiring a corporate recruiter, make sure to keep the trends above in mind.
Diana Martz is a Recruiting Analyst at OpenView Labs, where she is responsible for recruitment for the firm and its portfolio companies. For more from Diana, you can check out her blog, Happy Hiring, and follow her on Twitter @dianawmartz.