Just how much digital disruption can the recruitment industry take?
It’s seen the likes of Seek replace newspaper ads, witnessed the introduction of LinkedIn as a means to scout and find new talent, and now an Australian start-up is vying to be included on that rather prestigious list.
It’s calling itself a ‘game-changer’, but does it have what it takes?
Last week, a new online talent marketplace launched in Australia, with aim of making headhunting as easy – and possibly as successful – as a Google search.
A company (perhaps ironically) called The Search Party has compiled a database that astonishingly contains around 20 per cent of the Australian workforce’s CVs. Moreover, it says that the service’s pool of candidates is growing by 10 per cent each week.
If you’ve dealt with a recruiter at any point in your career, it’s likely that you’re already on this service and don’t even know it. But then again, do you know how many recruiters actually have your resume anyway? Probably not.
The Search Party established its ‘Google for headhunters’ by pooling together the databases of over 60 recruitment firms across Australia. The firms are working together on the basis that by combining their resources they are more likely to place a job, and hence be paid for their work.
The idea is for The Search Party’s database to become a one stop shop for employers looking for top talent. Rather than place a job ad, a company’s HR representative can punch in the details for what they are looking for and be presented with a list of talent.
Then, all going to plan, the company gets in touch with the recruiter, who has the talent’s details, negotiates a fee for their services and then attempts to broker a deal with the prospective employee. As for The Search Party, it takes a clip of the payment the recruiter receives when the candidate is successfully placed.
The recruitment disconnect
The Search Party’s CEO Jamie Carlisle says the service will help put in perspective some of the mind-boggling statistics that define the disconnect in Australia’s recruitment landscape.
For instance, he says that it currently takes around 81 days (or just shy of three months) and up to $15,000 for a company to successfully headhunt top level talent for a position. Also, only one in four company engagements with a recruiter end up in a successful placement. The figures aren’t too promising for an industry that appears to be at the bleeding edge of digital disruption.
It’s for this reason that Carlisle sees a need for The Search Party’s service, despite the other digital tools already at the fingertips of recruiters.
“Where we really differ, is that when the employer sees a candidate of interest they can ask a recruiter to broker the introduction,” Carlisle says.
“Although LinkedIn and other tools are really wonderful sources of information, they [companies] don't want to put their brand on the line by trying to head-hunt directly from their competition via an InMail,” he said.
It’s all about the data
The success of the service really rides on the power of that search engine – get a wrong match and any potential poaching attempt is really doomed from the start.
To counter this, The Search Party has also invested quite heavily in data science. It currently employs around three data scientist – which is a bit of a feat for a start-up.
Carlisle adds that by the end of the year he hopes to expand that out to five employees working full time on the company’s bulk of data. Given the current scale of his operations, the extra hands may be needed.
"For every two million candidate profiles submitted, we create two trillion data relationships,” he says.
But despite the investment, Mr Carlisle doesn’t buy into the hype around data analytics as some form of magic bullet for all businesses ailments.
In fact he jokingly calls it the “record label model” of business, meaning that for every ten bands signed up, only two will succeed. But he adds that the process is still worth it, because those two bands “turn out to be The Beatles or Oasis or something”.
On that, Mr Carlisle says that for every ten conclusions he reaches from data, only two turn out to both implementable and successful.
“If you’re going to do data science, over invest, don’t under invest and be patient with the answers because some of this stuff takes years.”
Will it work?
The Search Party’s database is still in beta, so it’s still way too early to tell whether or not it will be a success. But the early signs look promising.
Andrew Cross, managing director of tech recruitment firm Ambition – who is one of the recruitment firms lending its database to the service – says the early trials of the search engine have been promising.
He adds that the service is a “passive” upgrade that allows recruiters to really harmlessly harness their under-used candidate databases.
There’s obviously some merit in the idea. Australian web start-up turned job-search juggernaut, Seek, just launched an enhanced candidate search product aimed helping companies tap into its 1.6 million strong resume and active job-seeker database.
If Seek also attempts to tap into the databases of the recruiters, then it could pose a threat to The Search Party, whose success revolves around its ability to market itself as a first stop for all HR managers. Seek's marketing might and dominance could make this a difficult goal.
As for the rest of the recruitment space, it likely set to undergo more disruption as both recruiters and employers seek more transparency and efficiency from the sector.