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    It is better
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    Easy To Forget
    (September 10, 1999) Part of the process of training our research team includes a minor ordeal. We try to capture their naive responses to our industry by assigning the task of finding a job using a set of 50 websites. Since we hire people who are actively seeking work, we figure that they inherently "get" the ins and outs of rudimentary job hunting. College graduates of varying ages, they have some computer experience, limited web skills (in the beginning) and an over-riding urge to seem competent (because it's their first week on the job).

    The usability analysis we're developing this year depends on the experiences of these newly minted web job hunters. To simulate "real life", we hand them a set of web addresses and tell them to get going. The results are always interesting and sometimes more than mildly amusing.

    It appears that it is very easy to forget tht job hunters are uniformly naive. No one (in the real world) spends time getting good at using job hunting websites.

    One researcher began his assignment by tryoing to find a job in England. He opened his web browser to GISAJOB (a british enterprise with a database of over 90K jobs) and began clicking away. He clicked on the home button, thinking that Home would be a good place to start. It brought him back to the same page. He clicked various buttons and banners which all took him away from the site. Finally, he asked for help in frustration. (We've provided a screenshot of the GISAJOB site for reference.)

    Rather than wading in and bailing him out, we suggested that he look around the page for the word "Help" and click on it. Here's what he found:

    The search terms you input do not have to be complete words.
    "Wash," for example, will match occurrences of wash, washer, Washington, etc.

         - From the help screen on GISAJOB

    Reading the "help" instructions, he wondered "Am I supposed to look for a job Washing in Washington?" He asked, "What is a 'search term' and How do I 'input'?"

    A Better written help facility might have said:

    To find job listings in our jobs database:
    1. Type a word or phrase in the space marked "Search for your next job"
    2. Hit the enter key on your keyboard.

    You do not have to type a whole word.
    For example, by typing "book", you will find any listing with words like booking, bookkeeper, booker, etc.
    Typing "engineer" will show you listings for engineering, engineers and engineer.

    The original GISAJOB instruction is a compact, terse, jargon laden wisp of a suggestion with an irrelevant example. Useful help facilities avoid jargon and use examples that are easy to understand.

    In general, the GISAJOB site is difficult to navigate for a naive user. Its problems, unfortunately, are typical of a large number of the operations in our business. As we collect more detailed insight on the subject, we'll be certain to keep you posted.

    - John Sumser, © TwoColorHat. All Rights Reserved.

    The Model For The Newspapers

    (September 09, 1999) Yesterday, DowJones announced that it had acquired a 40% stake in our old friends at CareerCast. The move is important and interesting on a variety of levels. It demonstrates the Dow Jones commitment to controlling customer service while bestowing powerful market credibility on CareerCast.

    CareerCast, as you probably know, competes nearly head on with WebHire. They both provide the muscle behind "do nothing Recruiting" (replication and distribution) while delivering their services through and for other providers. In this arena, the service provider (CareerCast or WebHire)

    "scans internal job-posting systems of its employer customers and automatically replicates the postings and places them in a searchable online database. Users can then search the jobs by title, company name, location, salary level and other criteria."
    The results become an integral part of the database of the primary provider (usually newspapers or other large Job Board operation). In a nutshell, CareerCast and WebHire make it possible for a corporate customer to simply post job ads on their web site. The replication and distribution service takes care of the rest. WebHire owns the original technology in this market (formerly known as "Junglee". CareerCast has been able to nimbly observes the mistakes of the market leader and perfect its offering as a result.

    Both vendors offer a basket of other services to their corporate customers. CareerCast specializes in the delivery of integrated web services for multidivisional large companies. WebHire focuses its energies on its historical business in Applicant Tracking. While the two companies have some differences in their service offerings, they are the most observable players in the Replication and Distribution segment. In general, WebHire has the advantage in market momentum; CareerCast has the edge in service delivery. Were both stocks on the market, we'd rate them as a "Buy".

    While the acquisition confers lots of credibility on CareerCast (and we're certain that this is the first of many near term investments), the real story here is about DowJones.

    Tony Lee, the driving force behind careers.wsj.com and all of the DowJones online classified advertising operations is a red blooded newspaperman at heart. If you're ever in Northern Virginia, stop in to visit the Newseum, a museum devoted to the history of the news business. Much of Tony's personal collection is on display in the museum. He is an active contributor to the operation. He is one of those folks who have the news business in their blood, from history to inventing the future.

    Tony spent more than a decade as the editor of the National Business Employment Weekly and is a major force in our industry as a result. He knows everyone in the game and has a remarkable bullshit detector. He has watched the industry evolution over decades and has made a solid mark on its progress.

    From our perspective, that explains why he is personally establishing the model for profitable online classified advertising in the historical Newspaper business. Tony Lee combines the deepest "domain expertise" in the business with a lifelong burning passion about the industry itself.

    Have you ever wondered why the newspapers lost out on the first round of the online Job Board business? Obviously, there are several underlying trends that include the kinds of factors that let Amazon.com beat out Borders and Barnes and Noble in the first years of the business. Old mindsets are hard to change; new investments always seem risky and non-essential; and its hard to believe that a profitable business will erode quickly.

    But, there was also a structural problem.

    During the heady years following Watergate, the newspapers overemphasized the importance of their editorial team at the expense of clear business sense. The very customer service operations of the industry's cash cow (Recruitment Advertising) was outsourced to clever operations like the Bernard Hodes Advertising Group. Between 1975 and 1995, Hodes and its peers in the Recruitment Advertising Agency business took control of the day to day customer service operations in Newspaper Recruitment Advertising. As a result, when it was time to make a serious change, the newspapers had no internal expertise. A generation of outsourcing will destroy any core competence.

    When Tony began making his moves in the Internet world, he quickly grasped the pluses and minuses of the situation. The demise of internal competencies is simultaneously a blank slate and a skills deficit. He has been able to slowly and patiently build a real vision of Newspaper based Recruitment Advertising as a business that can be approached with passion. It's a more difficult chore for MBAs and industry outsiders.

    A constant focus on the expressed needs of customers (he visits with lots of them) and the slow building of a real internal talent pool has placed Tony in the catbird seat. If you watch closely, you'll see him become one of those "overnight successes that only took 20 years of hard work". He appears to have mastered the internal politics and the market politics required to create a sure winner. The rest of the online newspaper business is starting to take note.

    Tony's business model is the exact opposite of the recently dishonored hard copy Recruitment Advertising world view. He owns all of the critical elements of his operation. The sales people are internal, the website is internal, pricing is set locally and so on. The DowJones acquisition of a stake in CareerCast simply underscores the corporate commitment to his vision.

    Keep your eyes on both of these companies.

    - John Sumser, © TwoColorHat. All Rights Reserved.

    Super Bowl II

    (September 08, 1999) HotJobs (and, most likely Monster.com) are lining up their SuperBowl ads. With their risk laden decision to bet the company on the annual holiday last year, HotJobs set a standard for national competitors. It's becoming clear that things have changed. And not just a little. And not human nature. The core economics of Recruiting, driven by generational demographic shortages, are permanently altered.

    In yesterday's article, we cited an interview of Nelson Bolles, the legendary career independence guru. He said (regarding Online Recruiting), "It's the same old ineffective system in a new dress. Everyone is hypnotized by the job postings and resumes. But, in fact, they're the least effective ways for job hunters to use the Internet." While we agree, in part, there is a difference of major significance.

    It is true that current job boards and related tools are a primitive first step. It is also true that the notion that technology has made a powerful difference is somewhat bogus. It is true that "it's the same old system". But, the underlying economics are powerfully altered.

    Like many things, a clear crystal ball was not enough to alert businesses to the changes in the labor supply. The notion that human beings are the most valuable commodity in a business, while preached heavily, has never really been a mainstream notion. In an era of extremely tight supply, however, the emphasis shifts dramatically from the job to the candidate. Our existing infrastructure and mental models were built in a time when jobs were scarce and candidates were abundant. The opposite is true today.

    This means that the pure investment mechanics of Recruiting have inverted. Today, you must invest first and reap the benefits second. In earlier days, it was possible to build a structure in which someone else invested while the end customer in HR deferred payment until the end (or often 90 days after the end) of the process. Entire empires are built on that simple cash-flow equation. There stock prices are in decline because the model doesn't really work any more.

    As we gear up for the 2000 Electronic Recruiting Index (due at the end of the year), we're amazed at the proliferation of small, profitable job boards and online Recruiting services. There really are over 15,000 places online that will run your employment ad for a fee. Most of them expect upfront payment (the advertising business model). Many of them, though small, are extremely profitable (as a percentage of sales).

    In the interview, Bolles said "job hunters are afraid of rejection. So they typically dislike the face-to-face stuff. It's much easier to send a resume and be rejected by an employer than to stand in front of that employer and be turned down in person. The Internet is just a new way to avoid rejection." The difference today is that a hiring company can not afford to ignore a potential worker simply because they are risk averse. In a dwindling pool, that's all of the supply. Investment is required to ferret out the potential candidates.

    Long after Job Boards have moved on to the second and third generations of Internet Recruiting, the basic model set by Hot Jobs will remain intact. You have to advertise to the folks who are watching football, biking, driving their cars, playing with their kids and so on. Job Hunters are scarce and candidates aren't where they used to be.

    - John Sumser, © TwoColorHat. All Rights Reserved.

    Change? No Change?

    (September 07, 1999) Daniel Pink is the rapidly emerging voice of the "Independent Professional", today's colloquialism for contract worker or consultant. With a series of articles in Fast Company, an increasingly well recognized website and newsletter (recommended last week) and spots on NPR, Pink is becoming a mind worth understanding. In this month's Fast Company, he interviews Nelson Bolles (author of What Color Is Your Parachute?).

    Given Bolles wide influence (over 6 Million copies of Parachute are in circulation) and Pink's emerging influence, grasping their perspective on Electronic Recruiting is powerfully important. Read the interview.

    Here are a couple of snippets from the exchange.

    Pink: Hasn't the Internet and all its job sites made job hunting easier?

    Bolles: Outwardly, yes. Inwardly, no. It's the same old ineffective system in a new dress. Everyone is hypnotized by the job postings and resumes. But, in fact, they're the least effective ways for job hunters to use the Internet. If we step back a moment and look, we see that the Internet can help job hunters and career changers in five ways: They can search job postings for vacancies, post resumes, find career counseling, make contacts, and research companies and professions. Of those five, research is the Internet's primary value for job hunters. I can get on the Internet and find out almost everything I need to know about a company. On the other hand, the least valuable use of the Internet is searching for job postings. As I said: The job hunt is just human nature in action. That is, job hunters are afraid of rejection. So they typically dislike the face-to-face stuff. It's much easier to send a resume and be rejected by an employer than to stand in front of that employer and be turned down in person. The Internet is just a new way to avoid rejection.

    Pink: So the Web doesn't change the job hunt much. Well, are there any other cherished myths you'd like to explode? Aren't we all free agents? Should companies not be fast?

    Bolles: As I said previously, I have no problem with people noticing and talking about all the changes that have occurred. But I'd like them to talk about the constants, too. Yes, a lot more of us are free agents. And yes, a lot more companies are fast. But not everybody's become a free agent -- and not every company has become fast. We mustn't overdramatize our present time, as though everything is change, change, change. My wife, Carol, has a great saying about marriage: "You shouldn't have to work at your marriage. But you do have to pay attention." Many changes in the workplace aren't so dramatic that you have to work at them. But you do have to pay attention.

         - From Fast Company

    - John Sumser, © TwoColorHat. All Rights Reserved.

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