HRMDirect Blog

HRMDirect Blog http://www.hrmdirect.com/hrm3/blog/index.php Are social networks more honest than resumes? http://www.hrmdirect.com/hrm3/blog/index.php?entry=entry090624-101510 according to this piece. The basic argument is compelling: a resume is a private piece of paper, while social network profiles are public, and actively linked to a lot of people in a position to call the liar out.

It's a neat theory, but in the case of LinkedIn, I think the effect is easily overstated. To see why, I'll use my LinkedIn profile as an example:

1. It lists my current position as President at HRMDirect. It would take considerable chutzpah to fake a title on your current job, given the risk of being caught by a co-worker. So it's fair to say this is likely to be close to if not precisely true, though I'm not sure resumes are much worse, given the relative ease of verifying current employment.

2. It lists past positions as CTO for North America at empolis, and Product Analyst at CCBN. Again, I have the business cards to substantiate both, but they are somewhat distant. Empolis pulled out of the US market 5 years ago, and CCBN, where I haven't worked since 2000, was acquired around the same time. Still, I am in touch somewhat regularly with a number of people from both companies both personally and professionally, so they're decent samples.

Let's say that I changed "Product Analyst" to a slightly more senior title like "Product Manager." First, this would have to be noticed by someone in the relevant network, which is far from a certainty. Second, what would they do? We all see resumes as the employment equivalent of the carefully-lit and airbrushed Vogue cover shot of Angelina versus the Perez Hilton paparazzi version of the person found on their MySpace or Facebook profile. To the extent that the man on the street sees a LinkedIn profile as a sort of resume, I suspect people will apply the same rules.

3. It lists my past education as Tufts University, and to the best of my knowledge, there is no verification of either degrees or attendance. This seems awfully easy to game, particularly in the (not unusual) case where a person attended but did not graduate from a school.

But not all social networks are created equal...
Ironically, while Facebook stands resolutely on the "Personal" side of the work-play divide, in many ways its "Trust" mechanisms seem much stronger to me. When I first signed up and went to put in "Tufts" as part of my background, it actually required me to enter an alumni.tufts.edu email address for verification. Maybe LinkedIn does this now, but if not, they should. Many other Facebook groups, including some businesses, require a similar type of verification step.

Facebook, for those who don't recall the neolithic era of social networking, set itself apart early on by being highly exclusive about membership at a time when other networks were promiscuous. Also, Facebook is (at least in my experience) a much more "interactive" network than LinkedIn. That is, among my circle of friends and colleagues, people visit and update their Facebook profiles far more frequently, and that says a lot about reliability. As Kasper Gutman says in The Maltese Falcon, "Talking's something you can't do judiciously unless you keep in practice."
]]> The Sun Also Rises http://www.hrmdirect.com/hrm3/blog/index.php?entry=entry090129-131652 "What is the economy without growth? How would the sacrifice be distributed?"

The answer to the first lies in the answer to the second, which is, "very. very unevenly."

Economists consider an economy-wide growth rate of 3% or more to be very good for the US, while anything north of 5% is white-hot. Likewise, a contraction of greater than 5%, lasting more than a year, would constitute a fairly harsh recession.

Having spent nearly my entire working life in early- to mid-stage software companies, these numbers are a bit striking, because of how small they are. I've never worked for a company whose revenue changed by less than 50% in any 12-month period. We were always printing offer letters or severance packages as fast as we could. A shift of 3% would have been barely perceptible.

While early-stage technology companies are famed for their wild-frontier existence, research shows that this pattern holds true even as we look at the broader economy. An important insight is that while employment as a whole may go up or down by a few percent, the variation within individual companies is much larger. BofA and Citibank, for instance, are laying off tens of thousands of workers, and it is possible that headcount will not be replaced within the next ten years. Conversely, in 1998, Google employed only one of its now over 20,000 employees. Economist Arnold Kling quotes from a paper which noted the following trends from 1990-2005:

...in the third quarter of 2001, 31 percent of establishments contracted during the quarter and so contributed to job destruction. Another 26 percent expanded and so contributed to job creation. Most job destruction, 68 percent, occurred at establishments that contracted by 10 percent or more during the quarter. Perhaps more surprising, 63 percent of job creation occurred at establishments that expanded by 10 percent or more. In fact, the prevalence of such large employment changes is the norm in both booms and busts. Hence, most job destruction cannot be interpreted as the product of modest contractions achieved by normal rates of worker attrition. Neither can most job creation be seen as the outcome of modest establishment-level growth rates. That is, although most establishments experience little or no employment change within a quarter, job flows mainly reflect lumpy employment changes at the establishment level

Just because the economy as a whole is not growing, does not mean that individual companies are not. However, patterns of growth do change: large public companies may grow much more slowly than small private ones, or vice-versa. Industries which were less than vigorous in early 2008 may suffer permanent contractions (e.g. newspapers) while others expand just as rapidly.

So to John's question, I think that "the economy without growth" may not be filled with mortgage agents and hedge fund analysts, but it will not be devoid of growth or the opportunities which growth creates, for both businesses and individuals. ]]> Price and Prejudice http://www.hrmdirect.com/hrm3/blog/index.php?entry=entry081016-110504 "Now that the media would have us believe we're heading towards the second Great Depression, our decision to go with a lower cost solution is looking even better."

That's a direct quote from an email a client sent to me earlier this week, in response to an email announcing the largest upgrade to the HRMDirect product line in our history, including the immediate release of our onboarding and offboarding modules this month, and the announcement of pricing and availability for the workforce planning and performance management modules coming in Q1 and Q2 of 2009.

Early this year, a very good prospect told us that he had ruled us out because our prices were too low. Ever since we launched our beta product in 2005, various wise persons and experts have asked why we so stubbornly refused to ratchet up our prices and charge the same amount everyone else does for an equivalent, or in many cases, inferior product. "But you're making it harder for yourself to grow," they would say. It's a question we asked ourselves more than once.

Low-Cost Leadership: A Good Idea Then, A Better Idea Now
But no matter how many times "easy" money presented itself in the form of raising prices by two, three, more more times what they are today, we kept going back to our original plan. As a veteran of the 2000-2003 IT spending crash, I saw up close how hard it was to turn a company used to flying first class move down to coach. Pricing expectations drive every aspect of how any business is structured. Business processes which were sustainable with an average $60k customer simply could not be scaled back on a linear basis to work with a $20k customer, any more than Ruth's Chris steakhouse could easily get into the $8 cheeseburger business. Many companies with good people, products, and customers went out of business in that era because they could not adapt.

Already we've begun to see a new emphasis by companies on cost-effectiveness, and for the first time, some of the people who said we were too cheap are starting to appreciate the wisdom of our choice. HRMDirect has always been about a longer-term vision. We chose the name "HRMDirect" because recruiting was the beginning and not just the destination on our roadmap. Likewise, no one is getting out of the talent business. Whether your company is still growing, replacing turnover, or restructuring, our applicant tracking, onboarding, and offboarding modules will help you get your job done faster and cheaper while maintaining compliance and applying best practices for risk reduction. Our performance management module will soon help you build a solid, sophisticated, and easy-to-administer performance review system that measures and maximizes individual achievement. Our workforce planning module will set a new standard for organizational transparency and alignment. Our pricing and subscription structure will make it affordable for every company that wants it. If you're one of them, why wait? It's a great time to save some money and get a more robust solution for your talent needs.]]> Getting on the Recruiting Treadmill http://www.hrmdirect.com/hrm3/blog/index.php?entry=entry080218-125003 asks whether there is some sort of corporate fitness program out there to get businesses into shape:

In another article, by Luke Johnson titled “The truth about the HR department“, Mr. Johnson says: “Companies should start getting fit right now. As Albert Einstein said: “Bureaucracy is the death of any achievement.” When it is a question of survival, there is no room for the non-essential.”

This articles caused my head to spin, thinking; how are we to “take hold of our talent management programs”? How do companies get “fit”? I mean, is there some kind of treadmill for companies?

Well, actually there is--it's called "the competition," and if you don't beat it, it beats you.

Companies, like people, tend to respond more acutely to tangible pain than to abstract future rewards. Most of the people who go to the gym regularly and eat a healthy diet do so because they actually enjoy it. Sure, there's that promise of a longer, healthier life in a more-attractive body, but after a long day dealing with hiring managers, how many of us really look forward to sore muscles and a nice plate of steamed broccoli?

The challenge for managers who wish to be successful is to not wait until they suffer the corporate equivalent of a heart attack to change their ways. Those positions that can take months to fill today? Make that a year, and throw a 10-25% salary increase on there too, because that might be what you need to convince someone to leave a job they're quite happy with to take a chance on you. Change will certainly come when plans to open a new branch office hit a wall, or when you can't bid on new projects because you know you won't be able to staff them.

Now it's possible that in a year or two when this hits your business, those CxOs and hiring managers will admit you were right and start doing what you've been telling them to do all along. The big question is whether you'll be there to enjoy it. When people don't like their burger, they're liable to blame the cook before they blame the cow. OK, sorry, I know I'm preaching to the choir while you're out there trying to convert the heathen. You need a plan, not a pep talk.

The key for you is to draw the problem out into the open and put numbers on it. As Rodney Dangerfield once said, "Want to feel skinny? Hang around with fat people." So, put your hiring managers on the scale. Show them the time-to-hire reports, the number of applicants per position, and the starting salaries over the past two years. Don't put lipstick on the pig and hope that makes them think nicer things about you; roll it in the mud before you bring it into their office. Tell them that you need their support to get your new budget/project approved or else things are going to get really ugly. If management thinks the current numbers are still tolerable enough to shoot you down, ask them what would be intolerable so you know when to come back.

For some companies, the shooting has already begun. Ask our clientTechnip USA, one of the world's premier gas and oil engineering firms, how hard it is to fill many of their most important positions. A recession will definitely make it easier to hire a receptionist or entry-level IT person, but it won't increase the number of Senior Subsea Commissioning Engineers. Whether it's salespeople, tax accountants, AJAX developers, or what have you, there are probably a number of revenue-critical positions in your organization for which a recession will have little to no effect on the supply of talent. The good news is that you're not the only recruiter fighting an uphill battle. Chances are your competitors are mostly doing the same, which means the door is still open for you to gain a key competitive advantage.]]> HRMDirect appoints Django Bliss as CTO http://www.hrmdirect.com/hrm3/blog/index.php?entry=entry080129-100134 press release is here. We first met Django in early December when we started looking for a senior-level developer to add to our technical team here in Boston.

When we learned that Django was the original founder of HireAbility, one of the more innovative recruitment echnology companies in the space, we realized we had found someone a lot more valuable. The past month had seen some of our most rapid growth to date, and a continued steady increase in the size of the average new client. Django offered a unique combination of industry experience, deep technical knowledge, and a large helping of enthusiasm for the culture and lifestyle that goes along with a rapid-growth technology business.

One of the great strengths smaller companies have is their ability to match capability with opportunity in recruiting. Large companies flush with cash *should* be able to do this better, but only a special few actually do. When you're trying to fill a square hole, it's can be hard to build a case for an extraordinary round peg, and it's often impossible to do it quickly.

Fortunately, this was one of those times when we were able to bring the stars into necessary alignment, and the result is a mutually exciting opportunity. We have always known that 2008 would be a big year for HRMDirect, but now we look forward to it being truly extraordinary.]]> And This Time We Mean It! http://www.hrmdirect.com/hrm3/blog/index.php?entry=entry080123-120623 blogged this ZDNet post by David Berlind on Recruiting.com today predicting how social networks will put an end to the third-party recruiter once and for all. Berlind says,

If you’re a professional recruiter (particularly one that works for a recruiting/headhunting firm), then it’s probably time to start thinking about a career change. The reason? Once money starts talking, the mob of Internet users-cum-recruiters will be impossible to compete against.

His story is based on a single email from a recruiter-turned-CTO who blasted his contact list with an offer of $6000 if you found him someone to take a job and keep it for 90 days. Berlind follows this with a story of how he successfully disintermediated his recruiting department by successfully hiring one person off a Craigslist post and, "So successful was my first ad that I have another one up there right now."

As the old saying goes, "the plural of anecdote is not 'data.'" It's an easy pot shot to take, but anyone pressed to constantly come up with new material is going to occasionally commit the sin of extrapolating a couple of stories into a trend.

This isn't to say markets never experience dramatic change. Most of us can remember when the normal way to buy airline tickets was through a travel agent. The end of commissions forced agencies to find new revenue streams from other services like cruises and more detailed vacation planning. Zillow, an HRMDirect client, is providing consumers with access to data about real estate that was only available to brokers until just a few years ago. Houses aren't the same as cars, but until the past 5-10 years, invoice prices on cars were closely-guarded secrets; knowing the price the dealer paid could save you thousands. Now they're given away on dozens of sites to lure buyers to provide contact info.

Recruiting is partially an information business and companies like ZoomInfo (also an HRMDirect client) are making it easier than ever to find people whose resumes aren't in Monster's database. This space is very hot and between search engines like ZoomInfo and opt-in networks like LinkedIn, my sense is that the simple act of finding a name is going to become just as much of a commodity as buying an airline ticket or finding the dealer price of a Chevrolet is today. But even this will take time--name sourcers can make good money now because too many recruiters can't do their own research, and that problem will actually get worse before it goes away.

What Berlind is really railing against are recruiters who don't recruit. Whether in the HR department or at a large staffing firm, there seems to be no shortage of folks who seem to get paid to carry job descriptions from the managers to the job boards, and then carry the resultant resumes back over. My sense is that this is nothing more remarkable than a cyclical trend we've seen many times before that has little or nothing to do with new technologies.

In the late 90s, a sizable chunk of the economy (here in Boston, anyway) seemed to be made up of IT recruiters who knew nothing about IT or recruiting placing software engineers who knew just as little about engineering or software. By 2002, the only folks left standing in either space were those who went in knowing what they were doing or learned really fast. So in the end you can really restate Berlind's lede as "people who don't do their jobs will probably get canned sooner or later." ]]> Save a Tree, Buy an ATS http://www.hrmdirect.com/hrm3/blog/index.php?entry=entry071119-131118
This reminded me of how much paper is still involved in the recruiting process for many companies. Next to finance, HR is probably the leading killer of trees in an organization, from application forms, to background checks, and new hire paperwork. While converting to an electronic process can hurt a little at the start, the payoff isn't just greener for the environment, it also leads to easily-quantified cost reductions and efficiency gains.

Online application forms : HRM can turn your paper form into an electronic one, and you'll be able to collect applications online and access all of your candidate records from any PC with a web browser.
Instant background checks :
Pre-employment screening :
Compliance: Automatically survey and track a full suite of EEO and OFCCP compliance statistics, and generate reports with a single click.
Permanent candidate database: Next time you hire, start with your own database that costs nothing to search.

These are just a few of the ways that online recruiting can improve your bottom line, and clear off the top of your desk. But the most important feature that we offer is knowledgeable service, which is included in all subscriptions at no additional cost.

In contrast to older ATS vendors accustomed to working with large clients, HRMDirect's account managemers spend most of their time with organizations with anywhere from a few hundred to a few thousand employees, and is used to the unique challenges companies of this size face in transitioning to a paperless process. To find out more, check our online price sheet or click to talk to our sales team.]]> Let the Good Times Roll http://www.hrmdirect.com/hrm3/blog/index.php?entry=entry071107-165836 Quality Bicycle Products in Minneapolis, and we've been busy as all get-up with implementations from a scorching Q3, including a number of clients switching to us from name-brand competitors. Rapid growth can be painful at the best of times, but it's the kind of pain that makes you stronger.

We Hired!
Last week we added another member to the Client Service team here. Stephen Bass, a 2004 BU graduate with a CS degree and a solid support background, applied to a job we had posted on Craigslist, and within 5 days he was hired. Stephen impressed us as someone who could grow with the business and we're very happy to have him. It's a great market but Stephen quickly realized that the opportunity to be part of an organization like ours was special, and we salute his good judgment!

As the hiring manager and recruiter for the position, I have to say that I have no idea how people fill positions without an ATS. Well, I do have an idea, but it's got to be incredibly annoying to have to sit there and manually sort candidates into piles, send individual emails to everybody, and go digging through Outlook or a spreadsheet to look up a phone number. There's a saying that you should eat your own dogfood, and I though it tasted like filet mignon.

This was the second position we filled through Craigslist, and once again the results were great. I've defended Monster against charges of irrelevance more than once (I can see how many jobs our clients fill through them) but in this case I don't know what the extra $400 would have gotten us.

That was fun, let's do it again!
Now we're hiring for a Web Application Architect, and we're really looking for someone who is super-jazzed about the idea of joining a small and very dynamic company like HRMDirect. This is another great opportunity which has every potential to scale with the business.

As an experiment, I decided to post this position on TechCrunch's CrunchBoard. TechCrunch is probably one of the best sites for keeping up on the latest hot and wild startups, and attracts an audience of enthusiastic nerds with a business orientation. I've always been impressed by the level of intelligence in the comments on posts. At $200 it's not cheap, but TC has a very specific audience, and I'm interested to see if it delivers.

With close to three years and over a hundred clients under our belt, we're a long way from the stab-in-the-dark nature of many of the startups featured on TechCrunch, but we're still young, vibrant, and full of spots on the org chart marked TBD. At some point, even working in a sexy consumer-facing company is going to involve its share of ditch-digging, and the more heavily-funded a startup is, the more likely that working there is going to be just like working at a large established company, minus the job security. For a great egghead with entrepreneurial aspirations, this place is like an MBA in Real World Business, with a full-ride scholarship and a great stipend.
]]> Classifieds: Not Free, but Cheap http://www.hrmdirect.com/hrm3/blog/index.php?entry=entry071010-123239 free to paid classifieds:

TheLadders.com is moving from free job postings to subscription fees. HotOrNot just reversed a highly public experiment in which they switched from paid personals to free. Even hippy-dippy Craig's List is steadily abandoning free classifieds in their largest markets, and recently started charging a modest fee in even more cities.

While Dave's examples are interesting, I'm unconvinced that they have any bearing on the larger situation. Even if we do see a large-scale return to a paid model, a situation where "modest fees are a form of quality control" as Dave puts it is very different from one in which high prices (relative to cost) were a primary source of margin for otherwise sketchy businesses.

Publishing classifieds in newspapers never cost much money, but given their relative monopoly position, they were able to get away with charging premium prices. Today, the cost of publishing is close to zero, and getting easier every day, ensuring that competition from free providers will be a permanent feature.

As to quality control, all of the larger job boards have long gotten away with charging newspaper-sized prices while delivering content to users that is only slightly less relevant than an Oscar Mayer bacon billboard next to an orthodox synagogue. Bob Wilson continues to document this failure with mind-numbing consistency. Preventing blatant spam and scams is well and good, but it's hardly a major achievement in terms of the user experience, and price is simply the easiest way to do this.

But price is also an obstacle to adoption, one TheLadders used very effectively to build the very brand and audience that allows them to start charging meaningful prices. Prices are sort of like taxes--they always go up, while the value you get out of them seems to go down. Once you get used to charging $25, it's very easy to get used to charging $50, and before you know it, your customers have a good reason to spend the time looking at free solutions again. ]]> Must Be a Loner http://www.hrmdirect.com/hrm3/blog/index.php?entry=entry070919-122037
Job descriptions posted externally should exist to serve two functions: to arouse excitement among appropriate candidates, and to strike fear and doubt into the hearts of the unqualified. The ratio between the two should be about 90-10, with the essential function of the latter being to establish a few reasonable criteria of eligibility for compliance purposes.

Here are a few of my favorites that serve neither purpose:

Great communication skills required: If you know of any companies looking for someone who prefers grunting unintelligibly and scowling when asked a question, I know of several excellent candidates who can be had for a great price.

Good multi-tasking ability is essential: Because there are so many jobs out there (outside of an assembly line) that don't require the ability to balance priorities.

Must be a team player: Wait- let me get this straight: all I need to do is put these five words in my job description, and all those whiny, childish, responsibility-evading people will stop applying? Now you tell me!

What I've learned through hiring in a number of different environments is that defensive job descriptions do little to discourage the hopeless. The number one problem that afflicts these applicants is a lack of self-awareness, so nothing you say is likely to discourage them. Defensive job descriptions do, however, serve as excellent sales preventers with exceptional candidates, who can scent mediocrity from a mile away. ]]>