HR Meets Technology Asking The Right Questions

Author: Sanjay Sathe
Founder and CEO, RiseSmart
Effective management knows that people are the lifeblood of any business; talented employees are by far a company’s most valuable asset. Due to today’s dynamic workplace and the fast pace of ever-changing business processes, employers are increasingly turning to technology and vendors to assist in meeting the demands of outplacement and recruitment. But as with any vendor relationship, third parties you choose to do business with must have clear objectives, defined direction, and accountability. Never is this more important than when they are dealing with the very heart of your organization - your employees.

As an example, I would like to discuss here how technology can and should be leveraged in both outplacement and recruitment to allow the management of a company’s human resources to be as measurable and accountable as any other business initiative.

State of the Outplacement Industry

You may be aware of a recent Hollywood hit movie, Up in the Air, which tackled a topic companies in general don’t like to discuss: outplacement. This is an industry that grew out of a need to take care of employees even after business climate forced layoffs.

While many HR practitioners were excited about the prospect of George Clooney portraying a member of their profession, they largely have been disappointed upon seeing the film’s take on corporate layoffs and outplacement consultants. If you believe the Hollywood version, ‘transition consultants’ offer little more than glib pep talks and thin ‘packets’ of dubious value to laid-off workers.

This is certainly not the case in real life. Today, four out of five employers offer substantive outplacement services, ranging from career coaching and resume help to the identification of job leads, for weeks or months after qualifying displaced employees for the program. But many displaced employees are unhappy with the assistance they receive, and for good reason.

In recent surveys in the U.S. and the UK, approximately 80 percent of employers said they offer outplacement support, up significantly from just a few years ago. A 2009 survey by the Institute for Corporate Productivity showed that the US employers spent an average of nearly $3,600 per employee on outplacement services. Once reserved for managers and executives, these services are now typically offered to employees at all levels of the organization.

To run these programs, the vast majority of companies turn to outside consulting firms. This is a big reason that transition management has emerged as a $3 billion industry in the past decade.

And yet, for all the good intentions of employers, the results delivered by outplacement programs have been mixed. In the Wall Street Journal story of August 20, 2009, ‘Outplacement Firms Struggle to Do Job’, journalists Phred Dvorak and Joann S. Lublin make the case that traditional outplacement service packages – such as grief counseling, group seminars, and the use of office space – ‘offer little value’ to workers and leave many feeling dissatisfied. Since the methodology behind user surveys is flawed, some companies never know that their former employees didn’t find jobs. By some estimates, 40 percent of displaced workers who were offered outplacement services don’t use them at all – let alone participate in satisfaction surveys.

This lack of visibility and accountability has left many employers wondering whether they actually receive the benefits promised to them by their outplacement consultants. Employers are not doing enough to demand accountability and results from their outplacement vendors, including the most important result of all - helping laid-off employees find new jobs as quickly as possible.

Driving Accountability with Technology

But times are changing. It’s increasingly clear that the old model of outplacement is broken. Employees aren’t happy with it, and neither are employers.

Fortunately, there are indications that more employers are demanding accountability when it comes to outplacement. Three trends have contributed to this development:

* As large employers expand outplacement services to their entire employee population, the cost of services has increased – and measuring results has become a higher priority.

* As more small and medium sized businesses offer outplacement support, they tend to be more concerned with the hard benefits than the soft benefits of outside consulting services.

* Technology is making it easier for outplacement firms to deliver measurable and cost-effective results to employers of all sizes.

The creative leveraging of technology, in fact, is critical to increasing both employee and employer satisfaction with outplacement services.

Technology Can Positively Impact Recruitment

When it comes to recruitment, your human resources division will tell you, if you didn’t already know, that the process can be very difficult and long, and the ability to know for certain whether a candidate who seems like an excellent fit for the job will indeed have longevity with your company is akin to having one’s own crystal ball.

The complaints that many companies have about using third-party recruiters, however, involves the quality of the talent they receive through their doors, the lack of communication, and the expense. Certainly, this current economic climate has precipitated an employer’s market; skilled talent is out there and looking for new positions. The difficulty with an economy on the upswing, particularly for cost-conscious businesses, though, is that employees might jump ship once the market for their job skills opens up and other positions become available.

As I mentioned, no one has that crystal ball. But the best way to mitigate that risk is to start with a wide and diversified pool of talent in the selection process and a third-party vendor who focuses on accountability and considers you a priority client. Also, find ways to reduce your cost of on-boarding, using technology to shorten the time-to-hire and by closely investigating often large fees charged by some recruiters. Will it cost you 25 percent of a $70,000 salary in recruiting fees to hire a new person to fill that position? That’s more than $17,000. What if you had to do that twice – or even three times - in one year?

The truth is that technology, when properly leveraged, has the ability to change the recruiting landscape by finding a wider pool of talent, reducing time-to-hire, and significantly bringing down costs. There are vendors out there who can offer this to clients, if they are chosen based on their ability to deliver results, and they are given clear direction as to the collective goal.

A Formula for Accountability Technology makes accountability in outplacement and recruitment services more accessible. However, it is still incumbent upon employers to expect – and demand – results. This means that the employer should construct a model by which to measure the ROI of its outplacement and recruitment services provider.

While every employer’s situation is unique, companies that wish to assess the performance of their current outplacement firm – or determine which firm to choose during a selection process – should be asking the following questions:

* Is this firm’s thinking in line with my strategic business objectives?

* What is the measurement of success, and does this vendor have the capability to show me an effective measurement?

* In what timeframe does this project need to be completed? Does this firm have the capability to execute within that window?

* How, and how often, will this vendor be communicating with my team?

* How are my costs determined? How does that compare with my intended ROI?

* Is there a guarantee associated with their work? Do they guarantee to support impacted employees until the employees find jobs?

Do they guarantee to fill – and keep filled – the open position for which you contracted their help in recruiting?

The truth is that there are vendors who can become as integral to your business as your on-site employees. But it requires asking the right questions and demanding accountability. Those who can show you that measurement will be glad that you asked.
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