BenefitsEngaged Workforce

Managing Talent During Today’s Economic and Political Changes

Hires are down, but is this a time to panic? Some organizations are shifting their focus to improve their recruitment processes.

by Michael Beygelman

Barak Obama has clinched the Democratic Party’s nomination. He is also expected to raise more than $357 million to fund his White House bid, while John McCain will only have $85 million to spend. Clearly a lot of people are buying into Senator Obama’s slogan, “Change we can believe in.” At this level, Senator Obama would be able to spend $47 million per week during his two-month
general election push.

His campaign will unfold against a backdrop of a changing economy, one in which the stock market is also reflecting major shifts. Analysts are taking down their earnings estimates to more realistic levels, and just yesterday I saw gasoline at more than $5 per gallon; now that’s a change 130 million Americans can feel every day.

If we look at the totality of events shaping everyday news, we quickly come to realize that just about the only constant in the world today is change. While change does make people feel uneasy or less secure about their future, the reality is that without change, there is no future. John F. Kennedy said it best when he said, “Change is the law of life. And those who look only to the past or present are certain to miss the future.”

In a business context, I will assert that real change only happens when budgets are cut or sales forecasts are raised. Validation of this assertion can be gleaned by looking at HR and recruitment departments that are being asked to be more productive with fewer resources—politely stating their budgets are being cut. At the same time, companies are expecting their HR and recruitment departments to immediately react and scale up when the economy bounces back and as they raise their sales forecasts. These events necessitate HR and recruitment departments to change how they do business.

So is the change we are experiencing today a negative or a positive influence for HR and recruitment departments? From the front lines, I can attest that companies are indeed hiring less people in total, but some strategic organizations are leveraging this time to top-grade the caliber of their organizations. They are accomplishing this through strategic talent transformation initiatives, training, leadership development and executive coaching, geo-sourcing, and outsourcing parts or all of their recruitment process. The
reality is that recruitment is not a constant; it has never been. HR and recruitment departments need to adapt (change) to the new business needs by supporting budget cuts or rising sales forecasts.

I’ve seen some terrific innovation recently from world-class organizations leveraging the current change cycle to reconfigure their applicant tracking system, for example, while others have decided to implement performance management tools. Some organizations have actually shifted their hiring activity to focus more on revenue-generating positions so they are hiring sales and marketing professionals. A really interesting example of innovation resulting from change is ExxonMobil recently outsourced recruiting of its truck drivers. The company has seen quality of hire increases; attrition has declined from 30 percent in the first 30 days to 10 percent. The company’s safety record, measured by the number of accidents per one million miles driven, has improved 25 percent, and its interview-to-hire conversion ratio improved from 1 hire per 10 interviews to 7 or 8 hires per 10 interviews. Now that’s the kind of change (cha-ching) ExxonMobil can believe in.

Few would argue that capitalism and the global economy is Darwinian in nature. HR and recruitment organizations who apply Darwin’s thesis that “It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change” will prove to be organizational heroes and will help elevate their respective organizations during uncertain times.

In the next issue, we’ll get back to analyzing employment and labor trends to help these organizational heroes succeed in their respective moments of opportunity.

Tags: Benefits, Engaged Workforce

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