Considering how to hire in private equity? The staffing industry is booming, and the boom times are expected to continue.
To facilitate this growth, many agencies, particularly the largest, are embracing the digital transformation. Almost 60% of respondents to one survey agreed that technology provides a competitive advantage, and respondents plan to increase their tech investment this year. At the same time, the market is very tight, with more job openings than employed people. Companies are keenly focused on building relationships and providing an excellent candidate experience. The ones that are growing the fastest are investing in tech to help them achieve these goals, such as mobile apps, chatbots, and automated referral management platforms.
High-growth staffing firms are using technology tools to engage with talent
Finding and engaging talent continues to be the top challenge for staffing agencies. With the labor shortage, it’s no surprise that high-growth firms report using technology tools to attract and retain the best talent. Fifty-four percent of high-growth staffing firms are more likely to use a mobile talent app than slow-growth firms. Fast-growing firms also believe that technology tools give them a competitive advantage in the market.
In the U.S., boutique recruiting providers, which offer bespoke industry and functional solutions, shattered old records as the flight to specialist search providers intensified in 2021. As a group, these firms reported $2.2 billion in revenues, a 58% rise.
The private equity, emerging growth, and tech sectors dominated the market for search firms in 2021. Among the mandates for recruiters: Finding top-flight change agent CEOs, filling out the C-suites of existing and newly formed portfolio companies, and recruiting board directors.
In a Study in the Spanish Journal of Psychology, Ioannis Nikolaou discussed technological developments across four stages of the recruitment and selection process:
- In the attraction stage, (the article defined attraction as “the series of systems, processes, and strategies designed to maximize the size and quality of the [candidate] pool.”) While on-line/internet recruitment, especially social networking websites, have been in use for some time, they have dramatically changed the focus of attracting candidates effectively.
- The screening stage is the part of recruiting and hiring that has been most affected by technology. Cybervetting (the use of nongovernmental, noninstitutional online tools or sites (e.g., search engines and social network sites) from employers in order to extract informal, often personal information about prospective or current employees) and candidate tracking systems offer opportunities but also threats for recruiters and candidates.
- In the selection stage, of employee selection, two new selection methods; the asynchronous/digital interview and gamification/games-based assessment are the primary technological advances, along with the critical role and impact candidate reactions to cybervetting and technology-based “getting to know you” interactions have on the selection process.
- The fourth stage, onboarding, has also been greatly affected by technology, but this article is focuses on recruiting and hiring, so we will leave that aside.
This picture, like most 30,000 foot views of the industry looks very rosy, but it is important to remember that technology has its dark side as well. As Nikolaou notes, cybervetting, as an example, goes beyond the traditional boundaries of screening, no longer limited to CV’s, references, and perhaps a business-oriented site such as LinkedIn but extending to more personal sites such as Facebook, Twitter, etc. If the screening process is not carried out with transparency and integrity, the recruit may feel their privacy has been compromised. To be sure, there are sites such as GlassDoor where candidates can gain information about companies, but there is likely to be a sharp disparity in the level of information gained.
What has been referred to as the “Technology Transformation” makes the recruiting firm’s process much easier and more thorough, and can allow them to handle a much larger pool of potential recruits, but Nikolaou notes: “Candidates expect that professionally-oriented websites, such as LinkedIn, will be accessed by potential employers and often encourage this access by including their LinkedIn profile link in their CVs or application forms, but they do not have the same attitude towards personally-oriented social media, such as Facebook or Instagram.”
The potential negative impact of recruiting firms’ technological methods on candidates will reflect on the recruiting firm’s client, the hiring company. While technology can be a major boon to recruiting firms, their potential impact on the client company’s reputation can be devastating as word spreads among the talent pool. It is worth considering that if not used carefully, technology may sacrifice quality for quantity and convenience.
Farah Napack – Private Equity Recruiter, Lead for the Private Equity, Private Credit, and Corporate Development Practice at BrainWorks, a rapid growth executive recruiting firm serving some 16 practice areas, suggested in a recent interview that the firm is small in size but has grown exponentially in revenue and number of clients.
Ms Napack attributes this growth to BrainWorks’ culture of professionalism, integrity, and being client-focused, along with extensive use of technology, but in a way that does not lose sight of the human factors in recruiting.
“Client service is our number one priority,” Ms Napack said. “We want to make sure our clients obviously feel that we’re providing the best service possible that we’re responsive, that we’re timely, that we are really out in the market, getting them the best people we can find for them, and then also obviously providing guidance where we can. We’re the experts, and we’ve been out in the market, and we know what’s happening and being able to show them what’s realistic for them and helping them talk through different hires, and what would be best for their needs.
BrainWorks gives you personalized, nimble, efficient service, we’re not bogged down by any hierarchy or bureaucracy, everyone is really looking to do the best they can and looking to serve our clients in the best way possible. We’re super-efficient. We’re able to provide personalized service to clients that I think other firms are not able to. what makes BrainWorks different is that we provide personalized, efficient, and nimble service to our clients. And they’re always our top priority”
In recruiting talent, particularly executive talent, personal interaction both with the hiring company and the prospective hire is critical. While large firms have a great deal of resources available to them, that personal interaction is often missing. The client and the prospect may interact with a recruiter, but in a small firm it is likely that the CEO of the recruiting firm is talking with top executives in the client company and including the recruiting practice lead in those conversations. When the culture of the smaller firm is one of communication, collaboration, and teamwork, those values reflect on the hiring company and the candidate’s experience is one of partnership and inclusion.
In today’s highly competitive market environment, companies need to concentrate on candidate quality and candidates’ fit with the company’s culture. Attracting and retaining this kind of top talent can be a daunting process, particularly for companies that have not confronted the criticality of culture in driving business results. A relationship with a recruiting firm that understands and stands for the company’s purpose and partners with both the client and the candidate is likely to produce the best results. An effective recruiting partner will partner with the company to identify the right combination of skill and experience to find the top candidates and to convey to them what it is the hiring company stands for.
BrainWorks is a recruiting organization that partners with clients to match them with recruiters who are experts in meeting their needs. Areas of specialization include: Accounting & Finance recruiting, Analytics, Data Science & Data Governance recruiting, Commodities Technology & Training recruiting, Consumer Products recruiters, CRM & Direct Marketing recruiting, Data & Data Insights recruiting, eCommerce & Digital Marketing recruiting, Human Resources recruiters, Interim Accounting & Finance recruiting, Market Research & Consumer Insights recruiting, Private Equity Portfolio Companies recruiting, Private Equity, Private Credit & Corporate Development recruiting, Sales and Marketing recruiters Supply Chain & Operations recruiting, Technology Recruiters