Improve Your Return on Your Recruiting Investment

By Jeff Dahltorp

Summer, 2003

Call centers traditionally leverage four recruitment channels for their staffing needs: the Internet, third party recruiters, print advertisements, and referrals.  Using all four of these targeted approaches in the right mix and for the right reasons ensures that you are recruiting good employees while minimizing costs.  Let's briefly look at each of these approaches and then examine how they all work together.

Referrals:  A well-managed referral program can be the most cost-effective way to hire new, quality employees.  The majority of call centers have some sort of employee referral program in place that pays a current employee a "finder's fee" for referring someone that is hired and ultimately stays with the company for 90 days, six months, or a year.  These fees generally start at $50 and go up from there, depending upon the types of individuals someone is looking for and the size of the company.

The problem that some call centers face is a rising cost where there is no tracking done on the referrals that come through the system.  Employees may refer someone after they see that a position has been posted online, placed in the newspaper, or turned over to a third party recruiter.  If you end up hiring a person that was referred by an employee, your cost is not just the finder's fee, but the cost of all the other advertisements as well.  Use your referral program before you enter the market.

Print:  This is the most traditional method used for locating employee candidates, but has become one of the least efficient in today's economy.  Ten years ago, placing an ad in the classified section of your local newspaper for an open position was really the only way to reach a large pool of candidates.  Usually these people lived in the area and they were more likely to stay long term with your organization.  At the same time, placing that advertisement could cost in the thousands of dollars in a highly visible publication and you may have only received a handful of qualified candidates or you just settled for the best of the bunch.

Today, the Internet has really taken a toll on the value of a print advertisement for recruiting.  But the fact is that there still is a place for print advertisements depending upon the goals of your staffing organization.  Certain people still prefer to look at the classifieds for new jobs, especially part time and entry-level positions.  People who may not have direct access to the Internet may still read their local paper everyday.  Reaching them through print can be very effective.  Evaluate your objectives for filling a position to determine if there is value in a print advertisement.

Third Party Recruiters:  The third party recruiter does serve an important function in any company's recruiting effort, especially when locating a corporate-level executive or the hard to find specialist in a medical, engineering, or financial field.  Often the network that these companies have to generate qualified, passive candidates is very impressive.  As with print, think about the type of person you are trying to hire or the position you are trying to fill and determine if you can handle it through a referral, print or the Internet.  If not, then it might be best to start with a third party recruiter.

Internet:  Ten years ago, no one even knew what the Internet was.  Five years ago there were a few career sites online but none of them were well recognized.  At that time, employers wondered, "Why would you place a job online when there are very few people who have access to those job postings?"  Today, utilization of the Internet and the thousands of career sites that cover all job specialties and industries is the norm.  For a very low cost relative to print and third party recruiters, a company can have access to thousands of candidates from all over the world in just days.  However, this can be a double-edged sword.

When you have thousands of applicants, you want to make sure that you are interviewing the best candidates.  New technologies are on the market today that can prescreen, test, and rank your candidates before a recruiter even sees the resume.  These technologies can also be used for those candidates you receive from referrals, print advertisements, and third party recruiter.

Combining These Four Methods:  In reality, no call center can meet its staffing needs using only one of these four approaches on its own.  A mix of two or more of these methods is truly effective in finding and retaining the best candidates.  Start with the referral process.  If you don't currently have a referral program, then get one set up.  There are a number of good companies in the market that have the technology to manage referrals and payment of finder's fees.  If you do have a referral program, make sure that your employees know about it and how it works.  Having them refer people through an internal system allows you to track those candidates and referrals before you post a job online or with a third party recruiter.

After you have a functional referral process, look at the types of positions you have open.  Would these open positions be best filled by an Internet posting, a third party recruiter, or an ad in the newspaper?  Just about any position can be filled using the Internet but you can't expect one general job board to meet all your needs.  There is a reason why there are hundreds of successful career sites on the Internet; they all have a place for attracting qualified candidates.  You simply need to know which ones to use for your company hires.  Third party recruiters can be incredibly efficient, but they can be costly.  Make sure that you are not relying on them for all your hires.  Reallocating some of the print and third party recruiter budget to the Internet or to new generation recruiters and technology can help you reach the same results at a lower overall cost per hire.

Your decisions should be based on your company, your technology, and your budget.  Creating a recruiting process that incorporates an employee referral program and a strong Internet presence supplemented by third party recruiters and print advertising will generate candidates that will make you and your management proud by optimizing your workforce while minimizing costs.

Jeff Dahltorp is the Director of Global Marketing and Business Development for TruStar Solutions, which helps organizations create exceptional hiring strategies.