The recruitment agency business model is grotesquely dysfunctional.
It is broken.
Yes. It. Is.
Certainly for permanent recruitment.
We are just so used to it, have it so imbued in our psyche, that we don’t appreciated how farcical and damaging it is.
For everybody.
benefit no-one.
Clients, naively thinking they get a better service because they get agencies to compete, actually get a far worse service because they are actively encouraging recruiters to work on speed, instead of quality.
Recruiters suffer because even if we want to, we can’t really or , or ‘value-add’, and in the end we only fill one out of five jobs, if we are lucky, destroying profit in many cases, and the careers of recruiters too, who simply burn out, chasing rainbows.
And, the often ignored fact, candidates suffer the most because they
or due care from third party recruiters, who are too busy chasing mythical job orders in competition with five other recruiters, to actually focus on the candidates needs. That’s right. If recruitment worked like accountants, or lawyers, or doctors, or even real estate agents, where the service provider is not working on each case in competition… our recruiters would work on 20% of the orders they currently do, but fill 300% more! And who would benefit the most? Candidates! Yes candidates, who would no longer be treated like cattle, but rather like , as they should.
No wonder candidates are increasingly avoiding job-boards, and recruiters, and transferring their job search energy to web-searching, social media, and other tactics.
Yes, that’s a screwed system all right.
But it is getting worse as .
Have a look at my wizz-bang chart below (Yes, agreed, I am not a PowerPoint expert. But I did this at my desk at home, late at night after my third bottle of , and trust me, it may not look pretty – but what it represents is uglier still.)
Look at the left circle. It represents all the candidates available for recruiters to place in jobs. Look at the little segment on the right of that circle. That shows the tiny proportion of suitable candidates that recruiters actually access. To this day, most recruiters focus on so called ‘active’ candidates, those that come from job boards, or who are already on the database. There is nothing wrong with these candidates per se, except that they represent only a tiny percentage of the
What is more, because they are actively job-searching, they will in all likelihood be working with other recruiters already, or possibly well down another recruitment process.
Which means that you are not likely to place them. You understand that don’t you? It’s not only jobs that are ‘in competition’. It’s candidates too. And in a candidate tight market, a good talent that you have exclusively is a walk-in placement. Do you even think like that? Do you know who you have exclusively? Do you ask? Do you seek to find these people?
Look on my chart at the massive pool of candidates most recruiters do not access. There is your opportunity!
Now look at the right circle. This represents the majority of clients’ commitment to actually filling the job. We all know that most clients do not give their agency recruiter full commitment. That is what the shaded segment represents. Tiny commitment. In fact, many use third-party recruiters as an afterthought, or in competition. The vast majority of the commitment clients give to filling roles, goes somewhere else, such as the internal recruitment team, or using LinkedIn, or their own recruitment strategies.
So right there you have an incredibly dysfunctional situation.
The majority of recruiters access only a tiny percentage of the good candidates, and what’s more, secure only a fraction of the clients’ commitment to filling the job.
What other professional would deal with the customers on such a flimsy premise? Who else would invest the time and resources, that we recruiters do, on the tiny off-chance that a fee might be generated? But it gets a lot worse.
Not only do most recruiters run their businesses on the same basis as someone playing a lottery, they do it in
with five other agencies. This is ridiculous. Some very significant recruitment companies with massive turnover, still can’t make any profit because such a huge percentage of their staff time is spent on fruitless work that results in no return. In fact many such businesses are now going bust. Their cost base is too high for their income generation ability. And this is why! Their business model is screwed.
And it’s a vicious cycle of discontent. Clients get increasingly irritated because they are dealing with low-level recruiters, who don’t do a thorough job. Ironically the fault for this lies with the client, who asks recruiters to compete on the same job, thereby dumbing down the process. Recruiters get disillusioned, desperate, , and take shortcuts, which continues the cycle. And of course worst of all, candidates suffer.
But it’s not all doom and gloom. In the chart above lies tremendous opportunity, if you look for it. The prize goes to the recruiter who can develop strategies to access those candidates in the segment of the circle that are not active. The skill of bringing top hidden talent, that clients can’t find themselves, to the hiring table. That is the Nirvana we should all be seeking.
That is where the
is. And of course those recruiters who can blend technology with the
and who can secure a greater percentage of the , via retainers, , or other partnership arrangements, will differentiate right now, and into the future.
So, the winners will be those recruiters who recognise that the way we work now is terminally dysfunctional, and who act to access the parts of my circles that most recruiters do not.
Excellent! Got that off my chest. Time for another Boags…
This topic is crucial to our industry. Please have your say below.
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About Greg Savage
Over a career spanning thirty years, Greg Savage has established himself as a global recruitment leader. Greg is a regular keynote speaker at staffing and recruitment conferences around the world.
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Greg is always terrific - doesn't matter how many times I've heard him speak, his presentations are ALWAYS valuable.
One of the few presenters in and outside the recruitment world who can keep an audience engaged for so many hours!
Tania Kapell - Managing Director, Recruitment Edge, Sydney, Australia, 2013
Following your seminar, I am writing to you to let you know that the month of implementing your Backwards Plan and points system (May) we broke a company record in billings. I just wanted to let you know that in June we broke that record again! We had a monster of a month! I am absolutely delighted with the difference this simple system has already made to my business and just wanted to thank you once again. I’m focusing on managing the growth we are experiencing now – it’s great to have even happier staff who are all reaping the benefits of the points system!
Joanna Wilson - Director, The Ultimate Recruitment Company
Feedback from the Savage M Powering Profits in Disrupted Times, Australia and New Zealand 2016
Greg and Chris Savage worked incredibly well as a partnership in presenting together on highly relevant topics for our industry. As usual, it was delivered with loads of energy, professionalism and passion.
Kurt Gillam,
State Manager WA/SA,
Kelly Services
I was fortunate to first meet Greg Savage in 2001 where he presented a 1/2 day workshop for a boutique IT Recruitment firm I worked at. Since that time I believe I have attended most of Greg's workshops over the years. I always find him to be very inspirational. I also sent two of my managers to this years session. I find Greg's knowledge and advice to be exceptional and really a common sense, no nonsense approach. Chris and Greg presenting together provided a good balance of perspective. If there is one external session I attend a year, this is it.
Debbie Davis
Country Manager - Australia
Reed Specialist Recruitment
G practical, insightful and relevant information, presented in a clear and logical format, tailor-made to implement in any recruitment business today.
Belinda Kerr
MD - ICUR recruitment
Co Founder Sterning Group
Informative, dynamic session for doing business in today's recruitment world. The raw truths - no lecturing and no motherhood statements - they tell it how it is!! Lots of take home messages - if you weren't there you missed out!!
The Savage boys rock!!
Tania Kapell
Recruitment Edge
Thanks to both Greg and his fabulous brother Chris for putting on quite an educating and entertaining presentation today. It was very inspiring to actually see two brothers work so fantastically together, so be very proud that you left a huge audience in "awe" of your amazing efforts and advice. Marketing is quite a passion of mine so I thoroughly enjoyed today.
Irene Kennedy
HR Recruiter
HR Partners
I have recently joined the Six Degrees Executive team and was fortunate enough to be at the Melbourne Seminar this morning. I found today's session with you and Chris extremely informative, enlightening and a combination of my two worlds. Thank you for sharing your 35 years recruitment experience with me. For someone "new" to recruitment but having had 15+ years experience in client relationships it's reassuring to know relationship management and playing the long game are integral to success in this industry.. Thank you for sharing your knowledge and experience.
Rob Cooper
Executive Recruitment Consultant
Six Degrees Executive
Thank you for your fabulous presentation today! I thoroughly enjoyed it and I have certainly come away with excellent ideas.
Sarah Bailey
Senior Manager
Graham Consulting
Thanks for the insightful, thought - action provoking and humorous 1/2 day workshop you did with Chris in Sydney on Friday last week.
So much "Juicy" information in there. Thanks again
Geremy Glew
Placed Recruitment
Greg and Chris Savage delivered a powerful, information packed session with tangible action points to take away.
You will be energised, excited and driven to achieve your goals after this session, and with an even better road-map to get you there!
Erin Devlin,
people2people
As always Greg's presentation was relevant and thought provoking. Having Chris co-host provided a really good change in dynamic and an important and relevant perspective from outside the recruitment industry. They are easy to follow and more importantly, I always leave with 2 or 3 immediately actionable ideas, which will make Six Degrees, and the people that work here, even better.
Paul Hallam,
Six Degrees Executive
Both Chris and Greg worked exceptionally well. A good presentation..
The partnering worked well and the timing pretty good.
Chris was a lot more pro-active this time and our interest was held.
Both did well together. Waiting for the next one.
Alan Allebone,
Senior Consultant
TEAM Executive Consultants
Greg and Chris Savage delivered an energetic and insightful half-day workshop with their unique balance of perspectives.
Greg's recruitment expertise combined with Chris's PR knowledge provided a powerful combination.
Ben Walsh,
General Manager, Recruitment
Optimum Consulting Group
As much as it seems difficult to justify, and then actually take, a morning away from the day to day business responsibilities. Todays investment had a stack of returns that just keep coming for the full 4 plus hours. The Savage combination is a pretty slick one that is well worth the effort. I would be happy to back up and do it again next week.
Schadd Montgomery,
Pure Source Recruitment
Greg and Chris make an excellent team and will teach you business lessons that will last a lifetime. All this packed into a few incredible hours. Two incredibly talented guys.
Mark Fisher,
Eighty4 Recruitment
The session with the Savage brothers was informative , lively and full of passion for our industry. If you are under any doubt as to the sustainability of our industry then you will come away renewed fired up and raring to put a lot of what they say into action.
I have been to Greg's events for years and always come away inspired with great idea's that we implement. However I have never heard Chris speak before and found his wisdom and ideas relevant and on point.
For business owners and senior managers this is a must go to event.
Marie Howley-Watson,
Team Recruitment
Once again, nothing bland about Greg's information or presentation.
It was really beneficial having Chris present a macro view of business and it dovetailed nicely with Greg's information.
Incredibly valuable information for business owners and worth far more than we paid for it.
Thank you Greg & Chris.
Linda van der Velde,
Team Recruitment Ltd
Auckland, NZ
It amazes me that time and time again whenever we have Greg present, our delegates cannot ever get enough of him! They always want a repeat. No matter at what business level within our industry Greg presents to and no matter the theme, he consistently delivers a very powerful message that addresses the fundamentals of what we as individuals are about in business and how to succeed. To be able to capture that ‘spirit’ in people and channel it towards a common goal in the work place is done with genuine passion and a true belief that all things are possible. Greg’s own story and success is testament to that, with the added bonus of never being shy of sharing his own business highs and lows. His knowledge knows no bounds.
From a conference organiser’s point of view, Greg listens to the brief, is keen to know his target audience and is very thorough with his research, submits his synopsis in a timely manner and is extremely professional and accommodating on the day in regard to AV, sound checks and scheduling. (as one would expect!)
Claudia Gray - RCSA Learning Centre & Major Events Manager
Greg has been one of the best speakers for the Recruitment Industry that I’ve seen. He is passionate, innovative, and highly knowledgeable about where the future of our Recruitment Industry is heading – I aligned strongly to his thinking and ideas about clients, candidates and our own beautiful Recruitment Industry that he obviously loves so much! He is an icon in our space, and I always walk away from his presentations with some great ideas and inspiration to transform.
RCSA Conference Delegate 2012
Greg is great and really high energy. His enthusiasm about the recruitment industry is infectious and the work he is doing to promote the "good stuff" about what we do is invaluable.
Emma Egan - General Manager NSW, HR Partners Digby Morgan, Sydney, Australia, 2013
I really enjoyed your workshop yesterday and most of all, I got a few great tips that I can implement into our business. I do wish however I had all my managers from QLD there as well. Next time! Greg, on behalf of the 6 of us that attended from WorkPac in Brisbane – Thanks again.
Brian Goldfinch - Queensland Regional Manager, The WorkPac Group
Feedback from the Savage RCSA Acumen Speaking Tour 2015 “”
"Simply one of best RCSA events I have ever attended. Full of relevant information for both new and senior recruiters. Very relevant to the industry regardless of sector."
~ Nic McPherson - Advanced Personnel Services Limited, Christchurch
"Greg is a must see presenter, with deep heritage. He also delivers 'cutting edge' insights into the future. You must see him...."
~ Warwick Brown - Slade Executive, Sydney
"A powerful, energetic and incredibly informative session - full of innovative and exceptional techniques and advice! If you want to build your business into the future, following Greg Savage's advice on the New Digital Era and Business Development is essential! Thanks to the RCSA for arranging this fabulous presentation from Greg Savage - the Recruitment Industry Guru!"
~ Teri Moxham - Director, Southside Staffing Solutions, Sydney
"Excellent session. Informative, engaging and content full of amazing tips! Greg was brilliant. Thank you."
~ Michelle Seeto - EBR, Sydney
"Today's agency recruitment market must evolve into a 'new way'. Greg Savage has today laid out the best set of guideposts pointing the way forward. Every topic he covered was well thought out and clearly explained. Every point worked well with the others to help us see a fully picture of the future of agency recruiting.
~ John Cooling - CEO, SmartWorker, Brisbane
"Greg's presentation exceeded my expectations. He provided fantastic insights and tips on certain aspects of the industry that I barely scratch the surface of, i.e. social media, which will be extremely helpful to me and my business in the future. I look forward to his next event."
~ Wanda Brown - Oceania Recruitment Solutions, Brisbane
"I have followed Greg Savage for a while so I had high expectations for today's speaking event, and he did not disappoint. Not only great insights and industry analysis, but also practical tools to use every day to make me a better recruiter. Loved it!"
~ Terri Macchion - Ambrose Recruitment, Brisbane
"The Greg Savage RCSA event is a thought provoking, well-presented seminar from someone who has been pioneering the implementation of strategies and techniques from outside the industry and yielding measurable results."
~ Scott Burton - Business Manager, Abbertons Human Resources, Brisbane
"This session was full of 'gold nuggets'. The information provided was relevant, rich and well delivered. Those people who put into practice the strategies provided by Greg will no doubt have a huge advantage in a tight market.
~ Shirley Farrell - CEO & Principal Consultant, HR Call Centre, Brisbane
"Greg Savage's presentation on the topics and techniques covered was relevant, compelling, engaging and stimulating. Probably the best overall presentation/workshop I have attended to date. I will certainly take the tips back to the market I operate in. Thank you Greg, you are a true thought leader of the game."
~ Stephen Mead - PNG Country Manager, Peopleconnexion PNG
"If you love Greg's blogs, you'll enjoy him even more in person. Informative, stimulating, blunt, entertaining and generous in his tips."
~ Katherine Sampson - Managing Director, Mahlab Recruitment (Vic) Pty Ltd
"I have been to many workshops and seminars organised by RCSA. My favourite workshops etc. are always Greg Savage as the presenter. He is forthright, dynamic and very clear in his presentations.
Today was no exception. In fact it was educational, inspirational and motivational. A true eye opener for the old and the young. I would recommend Greg as a presenter and keynote speaker to any organisation regardless the industry."
~ Alan Allebone - Senior Consultant, Melbourne, TEAM Executive Consultant
"Brilliant... to present to a group of people for 3.5 hours and keep them completely focused is a rare skill, but Greg has rare skills! This session was totally relevant and jam-packed with takeaways and strategies to future-proof your recruitment business.
~ Craig Watson - Watson Collard, Melbourne
"A great session today with my consultants, Greg Savage really made a few people (Social Media doubters) take note on how to take charge of their own future and believe in what social media can do for them as a Recruitment consultant and the business that they work in."
~ David Gray - Director, LNG Recruitment Group, Perth
Greg was one of our keynote presenters at two recent Business Brains events. These events were targeted at owner or directors of established Recruitment businesses. He was extremely well received by both audiences. They loved his no nonsense delivery style and his high energy presentation. He was incredibly knowledgeable, told great stories and so brought his material to life for all that attended. He also was very humorous and engaging. The feedback was all positive and I wouldn't hesitate to use Greg again.
Kevin Green - Chief Executive, Recruitment and Employment Confederation, London, UK, 2014
Greg presented to my senior leadership team of business bankers at our half-yearly conference on the topic of “Driving Business Growth Through Exceptional Leadership”.
He delivered an outstanding presentation that was rated by the attendees as the best of the conference.
He was able to bring to life some simple yet effective insights on people leadership and exceptional customer practices from his 30 years in business and triggered much discussion for the remainder of the conference.
A very valuable experience for all who attended.
David Tonuri - State General Manager, National Australia Bank