Oh what a difference a bad year makes. Last January, the television broadcast of Super Bowl XXXIV — which, as you may recall, took place at the height of the dotcom frenzy — featured 17 commercials for cyber-sellers, virtual merchants, and E-tailers of every stripe. This year, the word dotcom was barely uttered during the entire four-hour broadcast of Super Bowl XXXV.
There were II notable exceptions. Online job sites Monster.com (www.monster.com) and Hotjobs (www.hotjobs.com) both ran commercials during the big game. The fact that managers at the two virtual placement companies were willing to shell out an estimated $2.3 million for a 30-second spot says plenty about the current state of E-recruitment. With the economy on the downturn, traffic at nearly all the top job sites has flat-out skyrocketed. In December 1999, for example, 352,000 searchers visited JobsOnline (www.jobsonline.com). This past December, the cyber-recruiter reported more than 6.6 million visitors.
Industry-watchers note that this surge in business is not just coming from laid-off Web designers, either. Increasingly, corporations are going online to fill management-level positions — a task previously handed over to traditional executive placement firms. In fact, ChiefMonster.com (http://my.chief.monster.com/), the senior-level recruitment arm of Monster.com launched in September, already boasts 100,000 registered members.
That’s an astounding response, particularly given the sorry state of online senior-level recruitment just three years ago. But Chandy Smith, assistant vice president of the business services division at Merrill Lynch, says improvements in technology — and a glut of applicants — have employers heading into space to fill vacancies. “Overall, there are not enough headhunters or effective ways to connect jobs with all the candidates out there,” notes Smith. “This lack of resources makes the Internet a very useful place for companies and candidates.”
The benefits of online job searches are pretty obvious. The Net enables employers to troll through an enormous pool of talent — exponentially more prospects than traditional headhunters can contact. And since hirers can put jobs up on specialized boards, it’s more likely that postings will be seen by qualified, and interested, candidates.
E-recruitment has one other small plus: It’s a heck of a lot cheaper than going through a placement firm. Typically, a real-world search to fill a senior-level position can cost anywhere from $30,000 to $100,000. Online, the same process may cost as little as $395, depending on the posting board. “Every time we use a [virtual] job board, it’s going to save us at least $60,000,” says Jim Pappas, manager of executive search at Schaumburg, Illinois-based Motorola Inc. (www.motorola.com). “We’ve already saved a couple of hundred thousand dollars from the four or five hires we’ve done online.”
Savings of that magnitude will generally get the attention of any CFO who’s upright and breathing. Indeed, the 40,000 recruiting boards currently on the Internet are bursting at the seams with job openings — many for directors, vice presidents, and other senior-level positions. In addition, a whole cottage industry has sprung up around the virtual hiring of top brass. Specialty sites, such as ChiefMonster.com, 6FigureJobs.com (www.6figurejobs.com), ExecuNet.com (www.execunet.com), and Futurestep (www.futurestep.com), offer recruitment and career services that specifically target senior executives.
John Garrett knows all about these cyber-headhunters. Last fall, Garrett, director of finance and administration at the Water Transmission Group of Ameron International (www.ameron.com), began looking for a controller to work at the company’s manufacturing facility in southern California. Ameron, which reported revenues of $550 million in 2000, makes highly engineered industrial products — things like water transmission lines and fiberglass pipes. Given Ameron’s unique mix of work for government agencies, multiple work locations, and job shop accounting, Garrett felt that traditional recruitment sources would not produce the best candidate.
Rather than place an ad in the classified section of the local newspaper or in a trade magazine, Garrett went online. Among other things, he posted the job at Futurestep, a Web site developed by executive search firm Korn/Ferry International and the Wall Street Journal. Garrett was pretty familiar with the company’s services: In March 2000, he landed his own job at Ameron through Futurestep. Garrett says that despite the complex requirements for the controller’s job, he was interviewing qualified candidates just days after posting the job on the Web. In December, eight weeks after contacting Futurestep, Garrett made his hire.
In the world of virtual placement, Futurestep is what’s known as a combination board. Essentially, combination boards are the online operations of an offline recruiter (in this case, Korn/Ferry). Of course, it doesn’t make a whole lot of sense for a traditional search firm to charge substantially lower rates for its Web services. Therefore, the fees for combination boards tend to be in line with the fees at their land-based recruitment agencies. Often, companies turn to combination boards to drum up candidates for hard-to- fill positions, not necessarily to save cash.
Managers who are mostly looking to slash placement costs have a number of options in cyberspace. Many go through free posting boards. These virtual job boards — while not actually free for employers — are a lot less expensive than combination boards. Typically, a company pays a site operator a modest fee, which can range anywhere from a few hundred dollars to several thousand, depending on the job. The charge entitles a client to post vacancies and search through an online database of résumés. Conversely, some companies rely on subscription-based virtual job boards to fill vacancies. At subscription sites, job seekers — not job posters — pay fees to put up résumés and to view listings. Employers are allowed to look at electronic CVs free of charge.
Subscription sites and free job boards sprang up, in part, as a reaction to the often exorbitant fees charged by executive recruitment agencies. Ironically, some employers have taken this spirit of disintermediation even further, creating job-posting boards on their own corporate Web sites.
It’s easy enough to do. A number of software makers, including Recruitsoft (www.recruitsoft.com) and RezLogic (www.rezlogic.com), sell prepackaged applications that help companies set up in-house posting boards. Others, like Hire.com (www.hire.com), an application service provider, design and host internal recruitment sites for corporate clients.
The self-help approach makes sense. According to Merrill Lynch’s Smith, an internal posting often provides more information to a candidate than a listing on an outside job board. Moreover, posting a vacancy on a company Web site helps to ensure that a potential employee is actually interested in that employer. As Smith notes, anyone who goes to a company’s site, searches around for a posting page, then digs down into the job board, is more than likely to be interested in that company.
By his lights, Jeff Browning thinks just about every company should create its own online job board. Browning is vice president of the talent network at Austin Ventures (www.austinventures.com), a private equity investor located in Austin, Texas. Browning says the venture capital firm uses its corporate Web site to recruit for the 90 businesses in the company’s investment portfolio. Thus far, Browning has been more than happy with the results. “It allows you to capture relationships with people on the Web site whom you would have lost contact with otherwise,” he explains. “For us, a proprietary site helps us to build our brand, as well as build a database of possible employees.”
While all the virtual posting models have their selling points, experts nevertheless say it’s a good idea to use a combination of resources when filling vacancies. The Internet may be a wonderful tool for recruitment, but consultants say there’s still a way to go before employers can rely on it exclusively when hiring.
One problem: Listings in cyberspace can generate a feeding frenzy. In the past, an employer placing a Help Wanted ad in a newspaper could reasonably expect 100 to 1,500 responses, depending on the geographic region and the job. Today, an online listing — even for a senior-level job — can generate thousands of applications. “Five years ago, if you wanted to apply for a job, you at least had to photocopy your résumé — maybe even adapt it — put together a cover letter, address the envelope, and put a stamp on it,” says Louis Tetu, CEO at Recruitsoft. “Now, someone can click once or twice and send out hundreds of résumés.”
Few of those clickers are women, though. While more women than men go online, there is nonetheless a smaller pool of female executives to draw from. Thus, cyber-recruiters attract a mostly male audience. “We see this as a problem,” acknowledges Chris Miller, CEO at 6FigureJobs.com. “Last year, only 12 percent of our candidates were female.” Miller says the Darien, Connecticut-based E-recruiter began direct advertising to women’s executive associations and networking groups last year. The campaign raised the share of female applicants at the site to 15 percent — not exactly a monumental shift in demographics. Courting minority applicants in cyberspace is even more difficult, since federal law prohibits employers from asking candidates about their race.
Still, the posting boards do make it a bit easier to ascertain details about a candidate’s personality and credentials. Many of the sites ask prospective hires to fill out detailed questionnaires or profiles, which help recruiters match jobs with employees. Executive placement sites tend to go one step beyond, often requiring candidates to prove that they are, in fact, executives. At ChiefMonster.com, for example, more than 150,000 people have signed on with the service. But according to product director Julie Miller, only 100,000 have made the cut.
That reflects the kind of numbers online recruiters are starting to deal with. While a sizable database means a sizable number of prospects, it also means a virtual recruiter must filter a sizable amount of information.
Sometimes, the filtering is less than satisfactory. Since most workers search for jobs by keyword — and since search engines are far from perfect — candidates often get leads on jobs that don’t match their skill sets. A treasurer looking for a CFO position at a telecommunications company, for instance, might search using the words management and telecom. The hits that come back, however, may be off the beam. “Basically, creating an online job description is a science,” concedes Tetu of Recruitsoft. “A poorly written ad can turn up thousands of wrong candidates.”
Brad Harkavy can attest to that. Harkavy, co-founder and CEO of a small new-media company called Vert Inc. (www.vert.net), recently ran into problems when he tried to fill two management positions using ChiefMonster.com. Harkavy says the online job board turned up more than enough qualified candidates for the first position. But the second posting resulted in a lot of responses from candidates who weren’t qualified, in part because “our job description wasn’t strong enough,” he says. “We were getting résumés from people who didn’t fit our needs at all.” The position was ultimately filled by an executive registered at ChiefMonster.com.
In some cases, however, the most qualified candidates never even make it onto an employer’s short list. Why? Because they weren’t on the list to begin with. Human resources consultants say many highly skilled — and highly desirable — senior managers balk at sending their CVs to E-recruiters.
Privately, some senior executives concede that they aren’t comfortable putting private information out on the Net. Others say they worry their employers will find out about a posting. Jane Paradiso, a recruiting solutions practice leader with consultancy Watson Wyatt (www.watsonwyatt.com), points out that many corporate executives aren’t actively searching for work, and therefore have no reason to sign up with a service. Paradiso says managers who are on the prowl tend to stick with tried-and-true methods. “Most employees use offline executive search firms,” she claims. “Or they network their way into new positions.” She notes that most jobs paying more than a $150,000 base are still filled by executive search firms and networking.
Maybe so. But as Motorola’s Pappas notes, the Internet can help employers do a little networking of their own. “If someone responds to an ad from ExecuNet and they aren’t right for the position, they are probably going to know someone else,” he explains. “People who are in the job market know other people who are also in the market — or they know people who might be persuaded.”
Persuasion is a funny thing. People who seem dead-set against an idea are often the easiest to convert. A number of virtual recruiters are reporting a big spike in the number of senior executives posting their CVs in cyberspace. Dave Opton, CEO at ExecuNet in Norwalk, Connecticut, says the company recorded a 37 percent increase in the number of jobs posted on the site during the last quarter of 2000. During that same period, ExecuNet saw a 70 percent increase in placements for jobs paying more than $125,000.
The economic chill won’t likely alter the trend. “There’s always a demand for talent,” insists Opton. “In a boom, you need people to manage the growth. In a downturn, you need someone to maintain profit margins. The Internet gives you a better way of doing that.”
Karen J. Bannan is a contributing editor at eCFO. Her résumé is on file.
References Available Upon Request
Currently, job seekers have an arsenal of Web-based resources to help them suss out a potential employer. The tools include digitized compensation surveys, discussion boards, and company filings with the Securities and Exchange Commission (www.sec.gov).
But job hunters aren’t the only ones going online to gather a little intelligence. Employers are slowly discovering just how handy the Internet can be when assessing possible hires.
For openers, many virtual job boards and career sites offer in-depth personality profiles of candidates. Beyond job posts, however, search engines and Usenet newsgroups can provide some truly valuable information about a prospective staff member. Recruitment experts say typing a job candidate’s name on a search engine, such as Google (www.google.com) or Yahoo (www.yahoo.com), often turns up some fine reading. Employers can uncover details about a candidate’s prior successes — or failures — and see what kinds of things have been written about a prospective hire in the press, on Web sites, and elsewhere in cyberspace.
Searching newsgroups may be an even better gauge of personality. These searches reveal where candidates have traveled in cyberspace — for example, finance or Linux newsgroups — and what they said while they were there. By going to Lycos’ message boards (http://club s.lycos.com/live/Annotation/BoardsHome.asp), for instance, an employer can bring up practically every comment a job seeker has ever posted online (most newsgroups are searchable back to the early ’90s). While experts say it’s impossible to assess a candidate’s inner workings based solely on innocuous statements posted in newsgroups, comments like “the company beamed isotopes into my brain while I ate Jell-O in the cafeteria” might be a tip-off. —KJB