As the economy continues to grow and unemployment remains low in developed countries, recruitment has become harder than ever. This year, 70 percent of respondents to the Deloitte Global Human Capital Trends Survey cited recruitment as an important issue, and 16 percent highlighted it was one of the three most urgent issues their organization is likely to face in 20191. This is rightly so, as in the age of the knowledge economy and changing workforce dynamics, hiring the right people at the right time can be the difference between a successful enterprise and a failed one.
In the fast-paced scenario, it is important to find the right fit for a role from a saturated labor pool quickly. Due to the record low unemployment rates in the developed world, the pool of qualified candidates to choose from has shrunk. For example, China’s unemployment rate was 3.8 percent in Q4, 2018. Further, the demand for technical skills combined with managerial prowess is a unique skill set which not many in the labor market possess. Around 60 percent of the respondents to the Deloitte Global Human Capital Trends Survey feel that the biggest challenge in recruitment is ‘finding qualified experienced hires’.
The war for talent is raging more fiercely than ever. Winning the battle requires more than execution; it demands reinvention not just of the talent acquisition process, but of the talent acquisition mindset
It is in this context, that technology has the potential to become a driver of transformation in hiring practices across businesses.
The unutilized talent pool
Broadly, the traditional talent pool can be classified into internal hires and external hires. When we talk about recruiting, the focus of most companies is on finding the right person from outside the organization. There are head-hunters, job posting websites, intermediaries, etc. to which companies often end up paying huge fees and yet end up hiring sub-optimal talent.
Companies often overlook the internal talent pool. Research has shown that it costs 1/6th to retrain an internal resource than hiring an external talent1. The DHCTS also shows that 56 percent of the respondents believe that it is easier to find a job outside the organization than inside. The question then is, how can we leverage technology to encourage internal hiring?
Alternate workforce: The talent pool of tomorrow
Contingent workers and other non-traditional arrangements form the alternate workforce. This tactic of working is gaining popularity not just among companies, but also amongst workers. This provides companies the flexibility they want in managing their balance sheets and meeting the legal requirements and provides workers the flexibility with their timing and workload. However, how do companies access this labor pool of the future, is the biggest question. Perhaps it is one that can be answered through technology.
Leveraging technology for the talent pools
Perhaps the single biggest change in the recruitment scenario has been brought in through the advent of data analytics, machine learning and Artificial Intelligence (AI). Companies are leveraging these technologies to make hiring more scientific and accurate. However, in spite of this recognition, the Deloitte study has found that only six percent of respondents believe that they utilize best in class processes and technologies.
In this scenario, it is pertinent to have a look at some ways in which recruitment is being changed by technology:
- Screening of candidates: Gone are the days when companies used applicant tracking systems to help catalog employees. Now technology exists which makes the screening process more scientific, robust and scalable. For example, there are tools in the market which use publicly available information about a candidate to create a profile of the candidate which can then be mapped to relevant roles in the organization. Many HR Tech Startups with AI-based chatbots, claim to reduce the time taken to screen candidates by 30-50 percent. This time can be spent on other critical hiring processes like interviews, and bringing the “humane” element back into recruitment.
- Conducting Interviews: Video interviews are being used to screen candidates and to assign them to roles that are the best fit for them. A few tools can be used not just to identify coding prowess of future employees, but it also offers a tool for online interviewing1.
- Internal Hiring: The most overlooked component of hiring can be greatly reformed by technology. Often, companies are unaware of the talent pool inside the organization. In this scenario, an AI-based assessment system can help organizations in mapping the competencies of their employees and find the right fit for roles from within. One of the largest global consumer goods organization has already used such tools for hiring external candidates who may not have college degrees but may be well suited for specific roles. Organizations should consider making AI-enabled competency mapping for employees a must so that they find the right talent in-house and cut down the time and cost of on-boarding of employees.
- Tapping the alternate workforce: Use of job networks can help companies tap into talented employees who want to return to work but maybe not on a full-time basis. Similarly, talent network sites provide access to a wide talent pool that prefers alternate work arrangements. Companies need to consider tapping into these networks to hire workers on a short-term basis to complete non-critical tasks. Companies would need to use tech solutions to tap into these networks, screen the right person and get them working immediately.
Recruiting must accept new technologies and capitalize on these capabilities to hire the right people and reduce the cost of hiring for the company. Companies must figure out a way to tap into the alternate workforce so that they can leverage the talent pool that exists in the gig economy.
The single biggest change in the recruitment scenario has been brought in through the advent of data analytics, machine learning and Artificial Intelligence; however, study finds that only six percent of respondents believe that they utilize best in class processes and technologies
In today’s world of changing jobs and skills, organizations have an opportunity to take a fresh look at how they approach talent acquisition, exploring new approaches to determining what talent they need—and where and how to find it. The war for talent is raging more fiercely than ever. To win requires more than execution; it demands reinvention—not just of the talent acquisition process, but of the talent acquisition mindset. To do this, organizations would need to rethink how to access existing internal talent, reset traditional expectations on where talent can be found and what it looks like, and rewire the recruiting process by taking advantage of advanced technologies like AI. The talent is out there if you know how to look.