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(January 23, 2007)
 Recruiters won't be automated away. From this vantage point, it appears that each new tool simply helps the working Recruiter gain a momentary competitive advantage. That edge disappears as soon as everyone starts doing it.

So, the latest sourcing methods, while critical for the success of any Recruiting endeavor, will fade to join the rest of the sourcing methods. The only thing that has proven consistently viable overtime is a value laden network. That happens when the network owes you vastly more favors than you owe it.

To build something like that, you have to tirelessly give away real value (and no, a piece of spam is not valuable to the network). Ultimately, you reach a tipping point at which the value returns. It never really comes from the places in which you've made your investments. It comes, duh, from the network you've built.

There are many, many kinds of Recruiter. Some will fare better than others in the future. Today, we'll look at a contingency Recruiters and their new, more robust form, the RPO.

There are literally hundreds of companies who call themselves Recruitment Process Outsourcers (RPOs). Their sales pitches, service offerings and pricing models vary enough to confuse the casual onlooker. What seems to bind them all together is that they are willing to commit to take on some or all (depending on the firm) of the inhouse Recruiting/Staffing workload. Each firm promises their own secret sauce (special software, a network, offshore sourcing services, pricing guarantees and so on).

Essentially, they are a smarter version of the Contingency Recruiter. Pricing tends to be, as it is inb the contingency business, a percentage of salary. The difference is that the RPOs nearly uniformly guarantee a completion rate over 95% for all searches conducted. The contingency fellow, more of a bounty hunter, is stuck with completion rates that are closer to 15%.

So, when a contingency recruiter completes his searches, he averages one in seven. That means that his fee is really 20% to 30% divided by seven (those unfinished contracts still have to be worked).

So, the contingenct recruiter wiull be phased out by a more mature, "under management" approach that guarantees reliable fill rates over and above the bounty. Because they are organized to deliver on this promise, RPOs appear to deliver better quality, higher profits and lower price points.

This is how replacements happen.

John Sumser © TwoColorHat. All Rights Reserved.
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