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Ten Minutes with John Sumser - Industry Expert

As the economy prepares for rebound, the way recruiting happens is going to change, says John Sumser, founder of Two Color Hat. Read on to discover why next-generation recruiters need to improve their contract management skills and build robust networks to recruit more effectively.Technology has significantly changed the ways in which companies recruit and retain talent. What are some traditional approaches that still work and which ones need to be retired?

What's changed is that recruiting starts out looking like something that has to do with money and ends up being about how people do business.Hiring someone is hard. It wasn't unusual to find people hiring people who didn't quite fit in or work out. Given the economic environment, the decisions you make when you hire someone are even more critical. There's less tolerance for errors now.

That means that people are not going to hire as much even when they have permission to do so. If you get the OK to hire, a company may be more likely to hire someone under contract or hire them for a short while to see if it works out. Real probationary periods or real contract starts are going to become more common.

One of theinteresting things about work is that it used to be something that happened in a factory. You knew roughly at the beginning of the year how many cars would come out of the factory by the end so you would hire based on the forecast for business volume.

Now, business happens in projects. What companies gain by operating this way is a good deal more flexibility. They don't have to make a commitment to an individual for five years when all they have is sixty days worth of work. It's more cost effective, you get higher productivity and when you don't have money you don’t' have to pay people. What works is something that used to work only for high end executives and now it works for everybody and that is building a network of relationships of people who you want to work with. That works for employers and individuals.

I'm seeing lots of people getting really good at building networks that endure. This is almost in spite of social media. It's not people putting 140 characters into their Twitter and Facebook profiles who are building networks. It is people who are engaging each other and finding out what problems are trying to be solved and what constitutes an interesting value.

The other thing that is starting to take root is that teams who do really good work end up working together. For example, if Yahoo! picks up one person they tend to pick up all people in the group. When Google hires they hire the entire squadron because they know how to work together. It's a very interesting idea, particularly when you have people who are good at a certain task that each company needs only once or twice a year.

What opportunities exist for recruiters in these challenging economic times and how can organizations use developing technologies to find candidates that were inaccessible before?

One of the big opportunities is for people in the RPO (Recruitment Process Outsourcing) business. People are not going to hire new people in a hurry, including recruiters, so it only makes sense that there'll be a move towards operations that could do volume hiring. And it'll be a price competition because that's the economy.

What I think is fascinating are the opportunities that exist. For example, if you are a recruiter inside or outside a company and you can find a way to specialize you will have an advantage. If you specialize, and have a network that you can keep building on, that's not something with which an RPO company will be able to compete.

Local and professional specialty networks are the name of the game. You can make a lot of money as a third-party recruiter or you can build a magnificent pipeline for your company if you're an internal recruiter. What that means is recruiting will have a bulk piece and it will have people who are specialists.

The other opportunity that exists is to become really good at managing contracts. The primary reason RPOs fail is because the people in the HR department don't know how to manage the relationship. Contract management has never been taught as an HR skill set. Purchasing is better at it, but you don't want purchasing managing HR. You want HR managing HR.  So, the development of contract management, project management or program management skills is a big opportunity for anybody in HR, including recruiters.

The other thing is that social networks are going to be good at identifying people. It's important to underline that finding people is no longer the problem. Almost the only people left who will say finding people is difficult are the people who find people - every body else uses Google. The hardest thing is having the right relationships so when it's time to hire someone you have a chance of hiring them.

The criterion for hiring or engaging people is another point of interest. When you hire somebody who is under 30, you hire their network, not just them. I'm talking with a number of companies that allow you to compare and contrast two networks. In the Top 100 HR Influencers project we're going to have a digital version of the 25 Top HR Digital influencers. You score people based on reach, traffic, relevancy, content, and conversational quality and then compare the networks, which is everyone you know on Facebook and Twitter, and see who has biggest and broadest network. With those factors you can and come up with the top 25. 

There are emerging companies providing data to recruiting such as Rapleaf. They're now wired into a couple software pieces or what used to be applicant tracking systems (ATS). It's not as a background check but as an additional chunk of information. You can find out who your candidate knows and there's a hard wired way to evaluate one network over the other.

What skills do recruiters need to develop to increase their effectiveness in building candidate pipelines? What should they be doing to improve the candidate experience and what tools should be in their recruiting toolbox?

I've been talking about this idea that you should be able to build a network of 500 people that is warm enough so that the 500 people interact with each other and that's your candidate supply. In the Top 100 project I'm talking to 500 people. In those 500 people, every time I talk to somebody, I try to get an introduction to three to five other people in the network. That means you have to have good memory skills or a better way of organizing information.

You have to be able and willing to listen to people long enough to understand what motivates them. Potential employees also expect to receive value from an organization just like employees, investors, suppliers, managers and local community. The value that flows from the organization is achieved through participating in the network. It's not another newsletter; it's complex introductions that are based on the needs of the people inside of the network. So the skills associated with that are the ability to listen and the ability to understand how to translate what one person is doing into what another person needs. Those skills of really connecting and networking and providing value are required for next generation recruiters.

You have been dubbed the ‘industry’s own innovation engine’ in part because of your ability to accurately predict the future twists and turns of the labor market. What’s next for the recruiting industry?

There's a disruption coming and I'm talking about that fairly regularly these days at conferences. You’ll recognize it when it gets here because all of HR will get done for 20% of what HR used to cost. If you think it's going to be other than that this would be a good time to start going back to school and get another discipline because you're going to lose your job. It's going to be really different and it's going to be really different in a way that is driven by cost.

There's a group in Australia, Talent2, the largest human resources consulting shop in Asia Pac, proposing that HR is a standards and accountability business and not an internal process business at all. In their view, HR is like a quality organization that simply articulates standards and policies and then goes and makes sure that the hiring mangers are following it. So HR is just a very tiny department because all the rest of the work can be done by outsourcing it. You just want to have your particular take on HR and your company and the execution should be managed by a well-equipped hiring manager. What that looks like in recruiting is hiring mangers get tools for building networks and get coaching on how to use them and 80% of all hiring happens that way.

The other 20% happens by a crack recruiting department. There’s this thing that people who are really great at recruiting don't ever recruit. They talk to people and stuff happens but it's really hard to look at what they're doing and the stuff that happens and figure out how the two go together. They’re just out there meeting and connecting with people. That stuff is not going to go away and you can't automate that even though there are a lot of people that are sure you can.

Other than thinking about and writing about the recruiting industry, what else do you do in your spare time?

I am sitting at my desk right now andwatching this beautiful purple house finch eating some sunflower seeds. Since we moved to Bodega Bay, I have become more aware of nature and wildlife than I ever thought possible.

Alfred Hitchcock made the movie The Birds here because there are a lot of birds – nearly 250 species were sighted here last year and I bet I've seen 120 of them – including ospreys, 15 kinds of hawk, white herons, blue herons, and two kinds of pelicans. During the month of June when the sun was out you could see American pelicans. They are all white with black under their wings and they look like they are changing colors when they fly. It's fun stuff to watch.