Talented teams make successful organizations. However, those talented individuals don’t typically come knocking at your door – you must proactively acquire them.
If you are committed to seeing better company performance, or eager for your company to outperform your competitors, by searching, finding, hiring and retaining the best talent available, then you need to adopt a talent acquisition (TA).
In this article, we’ll explain why, in today’s competitive environment and post COVID-19 times, talent acquisition is more important than ever before.
You’ll also learn how to get the most talented employees through best practices covered in this article.
Talent acquisition is a strategy used in recruitment that focuses on finding, attracting, hiring, growing, and retaining top talents inside an organization.
In other words, it is a planned and structured complex of actions the HR department must do to get the best employees.
The main question it addresses is: Given our resources, market position, labor situation and other competitive factors, where and how can we get talented employees?
The reason: competition in the labor market!
While assessing employee responses to a 2019 survey, conducted by CareerBuilder and Harris Poll, the authors of the survey found that: “50% feel like they have a career while the remaining 50% feel like they have just a job, and 32% of employees plan to change jobs this year”.
This suggests that there’s growing unease amongst employees about their current employment situation, which might lead to additional supply coming online to search for new opportunities.
At the same time, the August 2019 monthly report from the National Federation of Independent Business suggests another paradigm to the competitiveness factor.
The report concludes that “…small businesses’ biggest problem is finding qualified workers for their open positions”, with 26% identifying the inability to attract qualified workers as their number one challenge.
The umbrella organization, acting as the voice of small businesses across all 50-states, found that January 2020 number ticked up to 37% – up by 11 points from the previous month.
While there might be an adequate pool of employees to pick from, filling open positions with top talent is a difficult endeavor. And, unless you are one of the top-tiered organizations in your niche, it’s very hard to compete for that top talent. You need to strategize to recruit the best talent – either internally or externally. And, this does not necessarily mean offering prospective employees more money to recruit them into your organization.
For a long time, there has been a misunderstanding of the two terms. Even people in the HR industry often used the two terms interchangeably and referenced them as synonyms of each other. However, the two terms have marked differences.
Talent acquisition is a much broader construct than basic recruitment.
Recruitment is a part of talent acquisition, but it does not encompass everything that it does to satisfy ongoing staffing needs.
Make no mistake though, recruitment is a very critical subset of talent acquisition (and we’ll discuss that in greater detail shortly).
That’s because, one way or another – either by hiring someone extremely talented from outside; or developing the talents of someone from within – organizations must fulfill those staffing needs.
Both recruitment and talent acquisition go hand in hand.
You might view them as two sides of the same coin, with the role of the recruiter being to identify top-performing employees, and that of the TA being to acquire (sign-up) that talent for the company.
The end objective of, of course, is hiring extremely talented individuals who would be able to move the company/organization forward.
However, there are subtle differences.
Typically, if you have an amazing company where everyone wants to work, you will attract lots of top applicants and won’t have any issues finding the right candidate. The same is true if you are looking to hire for a position that requires entry-level skills. Consider the pressing staffing needs of an engineering company.
The objective is to find someone who can fulfill the organization’s current needs. There is no vision to necessarily source the best or most talented resource. So long as the person demonstrates their ability to meet the currently-defined need, the recruitment process is complete (and, presumably, a success!).
However, from the talent acquisition standpoint, you most likely care to hire a talented engineer, whom you might subsequently groom for bigger and better roles within the organization.
Different aspects of competition also play into defining how talent acquisition vs. recruitment works.
While both TA and recruitment do share the same goals, the objectives of the two disciplines might sometimes differ. For instance, from a recruitment standpoint, we have to hire people who fit the job description, and that sometimes means not necessarily hiring those who we want to hire.
Here is an example.
Let’s say several candidates are competing for an engineer position.
In this situation, the hiring manager may end up hiring the recent college graduate (even though he wants to hire the competitors specialist with more experience and job knowledge) because of limited resources for the position and possibility to grow this youngster to a great specialist.
This means that talent acquisition is a process based on a longer-horizon vision to staffing. Its long-term objective is to seek the most talented employees who, not only can fit the immediate bill but also have the drive, initiative and potential to contribute to the company’s competitiveness and long-term future.
As such, TA doesn’t necessarily seek to find the right candidate at this very moment. Instead, talent acquisition specialists prepare the groundwork to improve the company’s chances to hire the best people in the long-term.
Talent acquisition uses methods such as branding and marketing to attract the best and brightest talent out there. Neither recruitment nor TA ends once prospective hires become employees. There are additional steps in the process that need to take place including welcoming the person to the company as well as employee onboarding and completing a probation period.
The strategy involves continued nurturing and cultivation of talent through investments in staff development, employee rewards and recognition programs. This is typically done through branding, employee nurturing, developing company awareness even before soliciting potential employees and creating brand loyalty programs for potential employees.
Talent acquisition includes the following five stages:
Based upon each company’s situation, this necessitates TA strategists building an intimate knowledge of the industry that the company serves, as well as the company’s ongoing workforce needs.
This is essential to understand where the company is on the market, who your competitors are, and what their budget is, as well as think about the methods that work best based on the budget of your company.
Then, using the information collected, you need to come up with an effective plan covering what needs and can be done, and where and how you will find the talent you need to reach your goals.
Because the acquisition of talent is a continuous process, a good talent acquisition strategy depends on a steady stream of talent.
And the only way to ensure that a constant flow of talent into the organization is by building talent pipelines that you can tap on an ongoing basis.
So, it is important to create a talent pipeline and ensure that it works well at all levels from brand awareness to hire.
If something in the pipeline is broken or not working well, then you need to make improvements accordingly.
Corporate branding holds the key to successful Recruitment Marketing and Talent acquisition in the end.
A company’s brand often makes prospective candidates aware of who the organization is, and what they have to offer.
Without such awareness, talented individuals won’t consider working for that company.
Negative branding may even drive away any cursory interest that prospects may harbor to joining the team.
Statistics available on the subject confirm the importance and impact of branding on the talent acquisition process.
How a company projects itself to prospective employees, and how potential candidates perceived it, might often mean the difference between acquiring or losing talented individuals.
Before an organization commences active recruitment, there is a need to “sell” the company to talented individuals, as a good place to work in.
Top-talent might be actively (or passively) looking for new opportunities, but they are also conscious about what they want in terms of the quality and reputation of new workplaces.
Recruitment Marketing is responsible for that initiative. It involves:
The next stage, Recruitment, involves five states covering:
One study puts the number of employee turnover, resulting from bad hiring decisions, at 80%.
41% percent of respondents to that study pegged the cost (to the organization) of bad hiring decisions at $25,000, with some reporting it to be as high as $50,000.
The key to successful recruiting is to have well-thought-out procedures for each step in the process.
And the key to an effective talent acquisition process is seamless integration between recruitment marketing and recruitment. Lessons learned from Stage-2 (recruitment) can translate into optimizing various steps in Stage-1 (Recruitment Marketing), and vice versa.
Talent managers may use some or all the methods highlighted down below either stand-alone or in combination with one another to create organization-specific talent acquisition initiatives.
Additionally, there’s no rule against personalizing some of these methods to the organization’s needs.
For example, instead of acquiring freelancers as full-time employees, if they are uniquely talented individuals but prefer freelancing, talent acquirers may sign them up on an “exclusive” basis so they might not work on gigs with competitors.
This involves approaching talented individuals, who may be currently employed by competitors or in related (to your organization’s business) fields, and convincing them to join your organization.
This is the most effective way to get new talented employees, according to studies on the subject – especially if you use the social networks of your existing employees.
And one might see why it is such a powerful tool. Not only do such programs benefit from the “multiplier effect” (100 employees x 150 average social contacts = 15,000 referral potentials), but they also take less time (29 days) on average to hire candidates than other sources, such as job postings (39 days) and career sites (55 days).
Identifying freelancers and then actively pursuing them to join the organization.
Typically, such individuals may already have a contractor’s relationship with your company.
You may already be aware of the value they can add as an employee (versus a freelancer).
They already know a lot more about your company than most non-employees do.
This strategy hinges on “selling” the idea of becoming an employee: permanency of employment, a broader array of challenges, higher salary, better perquisites, greater prospects.
Using internships to attract talented students, and hiring them after graduation.
This strategy banks building relationships with academic and professional learning institutions, receiving a steady stream of undergraduate interns from those establishments, and rotating them through various departments/work centers within the organization.
The objective is to groom them as potential (future) employees upon completion of their formal study programs.
The level of education, and thereby the quality of available talent, in The World’s Fastest Growing Economies, presents a significant opportunity for talent acquisition specialists to tap.
It might be an effective strategy to set up offices in those jurisdictions (or work through local affiliates) and find talented employees willing to relocate or even work remotely.
This is common practice in knowledge-industries like IT and Customer Services.
Organizations lose talented employees all the time. However, not all such employees are satisfied with their exit decision.
Some may even have second thoughts. So, why not reach out to such employees and cultivate them as a prospective talent to be rehired?
Increasingly, employees who are looking for career moves visit career events such as job fairs, hackathons, workshops and career counseling sessions.
Establishing regular presences at these events, and hosting or sponsoring them frequently, is yet another way to acquire sought-after talent for your organization.
In large organizations, that have a “look from within first” staffing policy, this strategy is the predominant way to acquire new talent.
The strategy includes encouraging existing employees, who may either already be in subordinate positions or performing tangential roles, to take on additional responsibilities that may ultimately lead them to fill higher-level positions.
This talent acquisition strategy works well in evolving organizations, or companies undergoing extensive transformation or restructuring.
As company management map out the future leadership structure, they staff temporary (new) roles – either with external candidates or existing employees – and cultivate and monitor for “good fit”.
The role then receives confirmation, and the incumbents’ place on the team formalized, should he/she demonstrate desired talent traits.
Successful talent acquisition strategies do not use a “one size fits all” approach.
Implementation will differ depending on many factors, including the type of industry, company size, brand name, budgetary constraints, employment opportunities and competitor pressure.
The central point here is that you need to understand what types of people you can hire, and what resources you have at your disposal to do that and build your strategy around this understanding.
It is important to keep in mind, however, that the strategy will be different for each organization. However, the size of a company is often a key determinant of the TA strategy one pursues.
If you are a top-tier organization with thousands of employees, like Microsoft, Google or J.P. Morgan, then acquisition will likely be less of a challenge than growing and retention.
That’s because a wider pool of talented individuals is available (and willing/eager!) for you to pick from.
In such cases talent acquisition strategy must focus on:
Mid-level organizations, characterized here as employing between 500 and 1000 employees, may not have boundless career paths to attract talented workers.
This adds yet another disadvantage for them when searching for talented staff. They may also not have a huge war chest for pay and benefits.
A well-thought-out talent acquisition strategy for such companies could be formulated for two segments of mid-level companies, those that are well-known and those that are still brand new. Some of the methods may include:
However, it’s hard to compete with those better-known brands as their budget is lower.
What could they possibly do to ensure to compete with them/recruit top talent?
The strategy will be around focusing on increasing brand awareness.
Smaller companies and startups might use any of the following four approaches to acquire top-level talent:
Some smaller startups acquire fame as a result of the niche they operate in. When that happens, they’ll have more opportunities to attract, acquire and retain a talented workforce.
Renowned statistician Edwards Deming is quoted as saying: “What gets measured gets done”. Regardless of how well you may think your TA strategy is, there’s always room for improvement.
And the best way to assess how well (or poorly!) your strategy is, is to measure it against key TA metrics, including:
This metric measures the total time elapsed, from Awareness to Hire (see TA Process above).
The Society for Human Resource Management’s (SHRM) 2017 Talent Acquisition Benchmarking Report pegs this at 36-days (page 4).
However, each industry, business and position is unique and may have its acceptable time-to-hire thresholds. Make sure yours is within those achieved within your niche.
Folks typically (but mistakenly!) equate this to the dollar amount paid to a TA professional. It is NOT!
This must also include ancillary costs such as referral fees, marketing costs and advertising charges. SHRM’s estimate for this metric is $4,425.
If you deploy a multi-channel talent acquisition strategy, i.e. recruitment vial multiple methods, it’s important to measure the success of each individual method separately.
The yield ratio (successful acquisitions versus total attempted acquisitions) determines whether a channel is productive.
According to Deloitte’s 2017 talent sourcing report, 51% of employee referrals, and 42% of talent sourced through social networking channels provided the best quality hires.
This is an inverse of the Separation rate.
The SHRM TA Benchmarking report (page 15) puts separation rates at 17% within 6-months, and 26% within a year.
Higher retention rates (lower separation rates) are indicative of good talent acquisition strategies.
While calculating metrics such as Time-to-hire and Cost of filling the position rely on hard data (dollars, days, months, weeks, etc.), Quality-of-hire relies on subjective feedback.
The SHRM report encourages the application of 360-degree feedback, used by 26% of organizations, to assess this metric.
Talent scouts, Recruiters and Staffing agencies typically apply different standards to judge the success of a talent acquisition process.
What matters, however, is how many times the process meets the approval of hiring managers (the individuals seeking to fill open positions).
Tracking and measuring this metric demonstrate if your organization’s talent acquisition strategy frequently satisfies that key stakeholders’ needs.
Another subjective, yet vital metric that every organization must analyze.
While an applicant’s perception might be subjective, the number of favorable perception’s, versus unfavorable ones, indicate whether the strategy is working, or whether it needs a revamp.
Finally, while not strictly a talent acquisition metric, Cost-of-vacancy (COV) – which measures monetary losses as a result of unfilled posts – may also give you invaluable insight about how well (or poorly) your TA strategy stacks up in respect to your overall organizational staffing costs.
So, how does one go about creating an effective talent acquisition strategy? The best way to do so is to embrace current trends and best practices.
Here are 10 talent acquisition best practices to consider when building your own TA strategy:
Project yourself as a company where talented people would love to work.
One way to do that is to seek entry onto lists, such as “The Best Places to Work At…”, that highlight your company as one that values talent.
Agents or recruiters don’t have a monopoly on good talent.
Make talent acquisition a priority for everyone in the company.
Don’t just focus on acquiring.
Think about retaining the best and brightest that work for you.
Don’t just depend on the local community Newsletter.
Think about job boards, fairs and events, social media, corporate website, referrals, agency partners.
Watch staffing trends.
Maintain an active presence on all forums and platforms (digital and traditional).
Connect with your recruiting channels frequently.
Often overlooked, but vital to the success of any talent acquisition strategy!
Good acquirers beget great acquisitions!
Use a data-driven decision-making process to build flexibility into your talent acquisition strategy.
If fairs and events aren’t delivering acceptable ROI, focus more on Social forums or building agency partnerships.
Some ways to do this include: Bonuses to Talent Agencies; Company-wide recognition to employees who refer great talent; Awards/promotions to company HR/hiring managers.
Think about streamlining the Onboarding process – including through feedback from newly acquired talent.
Offer L&D opportunities at work.
Institute organizational Mentoring and Career Path Guidance programs.
These steps will foster employee loyalty and strengthen staff retention.
Use exit interviews and “failed” attempts to acquire talent as a learning opportunity to streamline the talent acquisition process/strategy.