The pre-pandemic War for Talent was, with hindsight, really a skirmish. Now, it’s war!
The economy is springing back and there is plenty of pent-up demand that wants to be satisfied. Projects were on hold, purchases were deferred, etc. But springs don’t act with smooth linear change. The change they trigger can be sudden, almost violent.
According to a recent McKinsey report (Help your employees find purpose – or watch them leave):
Nearly two-thirds of US-based employees we surveyed said that COVID-19 has caused them to reflect on their purpose in life. And nearly half said that they are reconsidering the kind of work they do because of the pandemic. Millennials were three times more likely than others to say that they were re-evaluating work.
HR and business leaders have to decide now whether they intend to pay defense during this challenge or create an offensive strategy. Doing nothing different, by the way, is neither offense or defense but it’s probably fatal.
Today’s talent issue is more than simply finding talent for the increasing demand. It’s a multi-faceted challenge that is new. It is much more than a recruiting throughput problem. It’s a supply chain dilemma and it needs to be viewed as such.
The supply chain for talent has some real challenges. Specifically, some workers:
- Still can’t or won’t rejoin the workforce.
- They can’t get vaccinations because of their age, availability or other reasons.
- They fear for their personal safety/health.
- Refuse to get vaccinated.
- Are still caring for children who aren’t back in school full-time.
- Don’t feel safe at their old employer.
- Earn better money on unemployment.
- Get more hours elsewhere.
- Know their co-workers are not following safety protocols.
Well-functioning supply chains have some measure of balance between supply and demand. What no one seems to want to address post-pandemic is this: just because employers want to re-open doesn’t mean that sufficient workers will be available to do so. The supply and demand situation is out of balance on two levels. At the macro-level, the demand for qualified workers is close to exceeding supply today.
But the bigger problem is at the micro-level where the demand for certain skills is massively out of line with the available supply. What neither employers, educators and employees want to face is that all of these groups are partly responsible for these skills shortfalls. Employers expect competitors to train people (not the employer!). Educators may not be offering what’s market relevant for students. And employees aren’t getting or can’t afford to get additional education.
An even bigger issue is that companies are desperately looking for people with skills in advanced technologies (e.g., algorithmic tuning, complex manufacturing technology, Artificial Intelligence, etc.) with no idea as to where to find such persons.
To that latter dilemma, I recently had a great conversation with a new factory of the future leader who lamented that their digital transformation has these challenges:
- Their factories are often located in rural areas. Access to personnel with skills in advanced technologies in these small, out-of-the-way markets, is very problematic.
- Many of their workers have Junior High or High School educations. It’s doubtful more than a couple of them, at best, would make the transition to an algorithm-tuning math quant or smart analytics guru.
Beyond those pandemic-related challenges, some workers:
- May possess skills that are not market relevant anymore.
- Want employers to pay them while they get training for new skills/capabilities.
- Do not possess the scarce skills (e.g., machine learning) that employers desire.
- Want employers to pay market rates (or premiums) for hot skills but some employers won’t do so.
Jobseekers are being selective, too. In their case, jobseekers believe many employers damaged their employment/recruiting brands during the pandemic and don’t deserve their skills. These employers have impacted workers via:
- Business shutdowns.
- Inadequate PPE.
- Benefit cuts.
- Facilities closures.
- Across the board pay cuts.
- Stopped funding of retirement plans.
So, in essence:
- Skills needs are mushrooming.
- Few real changes are occurring that will close the demand/supply gaps
- Employers will have trouble filling positions due to brand damage actions.
- Skills in new, advanced technologies will be very important, hard to find and impossible to locate in remote areas.
Defense vs. offense
Ineffectual HR leaders will try to get through the next few years leaning on things that kind of/sort of worked in previous economic recovery cycles. The Defensive CHRO will:
- Pour lots of money and energy into recruiting. In doing so, he/she will realize that:
- It isn’t attracting a lot of people especially those in hot skills areas.
- It isn’t attracting the best people out there. If you recruit without addressing the employment. brand, poor employment reviews, high friction work environment, corporate stinginess, and, disregard for people’s lives/well-being, you will get miserable recruiting results.
- Work the same over-mined job boards and candidate sources and be surprised that the pickings are slim.
- Be surprised that attrition is exploding and not know why.
The most effective HR leaders will have a different playbook. They will play offense and get ahead of their competitors. They will:
- Fix the work environment, employment branding and other issues above.
- Get aggressive in identifying the best talented personnel in the firm and get them the training that will enhance their careers. These leaders develop their own talent pipeline. They don’t assume competitors will grow these people for them.
- Identify former employees and create outstanding outreach and re-recruitment programs to bring these former assets back into the fold.
New/old talent sources
Some HR leaders won’t like this but playing offense will require new methods, new approaches and fresh ideas. For example:
- Instead of looking to hire people from competitors, are there people in other industries who might be just as creative, valuable, etc.? Have you identified vertical sectors that might be throwing off excess talent that might work for your firm? During the pandemic, we saw many in the restaurant/hospitality industry get hired by drug store chains and grocers. These firms have already discovered that people are far more malleable and adaptable than previously thought.
- It may be time to reset your relationships with colleges and trade schools. Some firms only want to hire persons from certain schools and pass on all others. Smarter firms now look at top graduates from a much larger pool of learning institutions to both create a more diverse workforce and to meet the numbers they desire.
- Smart firms might want to rethink the work environment they’re pitching. The one size fits all style of hiring is really out-of-date. Why not offer someone half-time or flex hours if that’s what they need. Likewise, why not offer daily pay, more hours, a chance to get benefits, etc.? Blanket work conditions (e.g., no work from home, no overtime, etc.) make your firm less (not more) attractive as an employer.
- Alumni may be the biggest, easiest, lowest risk and lowest cost prospect base to tap into but only if your firm knew more about these former employees.
Alumni are actually an asset of a firm – it’s too bad few HR leaders get this. Ignoring this workforce opportunity is expensive now and doubly so as firms scramble, post-pandemic, to find additional talent.
One clever client of mine keeps tabs on most all of its former employees. This healthcare firm often needs to find a short-term replacement for someone in their hundreds of locations nationally. In seconds, they can ‘re-activate’ a former employee to work for a few weeks or months at a given location. Some of these folks are retired, some took off to raise children, some have been providing home care for a family member, and, some just wanted to work less.
No matter the reason for them becoming an alumnus, these people fill critical positions at little to no cost. But the real value of alumni comes from their:
- familiarity with your firm’s processes, systems, reports, controls, products/services, methods, etc. (deep tacit knowledge).
- first-hand knowledge of your firm’s culture and have functioned within in (culture fit).
- need to only require the barest amount of catch-up training to be current again (speedy onboarding)
But many firms won’t use alumni. Why? The reasons include:
- They don’t stay in touch with former employees.
- They assume former employees won’t come back even if asked.
- They expect former employees to reach out to them and not vice versa.
- They feel that once a person has left an employer, they’ll never come back.
And, it gets worse. Even when employers try to bring back a former employee, they fumble, often badly. For example, employers might try to bring the employee back:
- Into the same role with the same supervisor. That might be ill-advised as approximately half of the time that people leave it is because of their boss/supervisor. Who would want to return to same person that made their old work environment unpalatable?
- Into the same role without thinking that the person may have acquired new skills since their prior stint with the company.
- To get the same pay, same location, etc. without any concern as to inflation, new skills involved, etc.
- Without addressing the reason(s) they left in the first place (e.g., unable to get the hours they needed, being overworked, not being flexible in setting their schedule, etc.)
My old employer has an alumni system. I’m really not sure what its purpose is other than to be a directory for curious former employees to reach other former employees. This system now gets some use by line management or HR to find people for internal positions but there’s rarely anything there for people with lots of experience. Many of the job postings seem to be for helping alumni get placed into other firms.
I put in 18 years with this firm and have been away from it for some time now. In that time, not once has anyone from HR/Recruiting ever checked in with me. They still don’t know why I left the company and under what conditions I would consider returning. I’m not sure that even if I provided that information that they’d know what to do with it.
My old employer might think I’m still the same person with the same skills and career aspirations of old. That’s not the case at all. The firm, if it ever thought of me again after I left it, has an image of me caught in a time warp. This lack of information creates a real problem for employers. Employers/recruiters will assume facts not in evidence. They are drawing conclusions about people with no current or accurate data.
I get sporadic invitations to attend alumni events from my old employer. These are a curious bunch of activities. Some events are staged at a public venue. They’ll invite people to an amusement park or a baseball game. I went to a couple of these but never met a single person I knew from work. Other events were for former partners/executives of the firm. I did attend a couple of these but was frustrated by the company’s lack of thought in the event. At one meeting, the managing partner of the office asked us to help them close several mega-deals. I raised my hand and asked: “If the firm won’t allow us to work on client projects, what is in it for us to help you win an 8-9 figure deal?”. Seriously, they want us to sell the work for nothing and get no part of the consulting revenue?
A great alumni system has to work for both parties. My old employer’s system doesn’t.
Alumni and HR tech
Not every HRMS or HCM system has an alumni module. That needs to be rectified.
But even those solutions with one may need to materially update their software. Specifically, a market relevant alumni system needs functionality that permits former employees to note under what conditions they’d consider rejoining the firm and for how long. Just putting out a list of open positions won’t cut it.
These enhanced systems also have to do a better job of triggering alumni to actually engage with the software. I know I only peek at my former employer’s alumni maybe once every 12-18 months. Why? The content is not relevant and much of it is self-congratulatory.
This is one of the biggest issues with these systems. They were not designed to be used by recruiters to place former employees back into the firm. Specifically, they don’t have any outreach functionality. There’s nothing there to guide a recruiter in finding ex-employees with specific skills.
Worse, even if these people could be identified, there are no way for recruiters to reach out to ex-employees and cultivate a relationship with them. This functionality does exist in Candidate Relationship Management software (egL Symphony Talent’s SmashFly) and could be a template for what should exist in an alumni system.
The War for Talent is on again and with a vengeance. The demand/supply imbalance is going to get painful soon and CHROs must get ahead of this challenge if they want to protect their jobs.
The smart firms will want to play offense and should look towards many new sources to fill these talent voids. Recruiting won’t solve everything. Companies will have to rethink training, internal development, relationships with old and new education sources, etc. It’s clearly time to reinvent and reimagine recruiting.
Alumni systems need a lot of work to help with this. Smart CHROs won’t wait for the technology to catch up. In fact, these CHROs will create metrics for their recruiters and themselves to see how many positions they can fill with former employees not just net-new people.
One thing for sure, I won’t be waiting at my phone for my old employer to call. That hasn’t happened in eons and I doubt it will now….