Bidding War for Human Capital

The shortage of skilled workers in the technology sector is something that often dominates the headlines these days. It is staggering to think that even with the recent meltdown in the technology industry, there still remains a critical need to fill as many as 850,000 tech jobs in North America and one million positions in Europe.

A global bidding war for IT talent now rages on 24-hours a day, and it appears the war is spreading to other knowledge-based industries, partly as a result of the shift to web-based hiring and partly as a result of growing shortages of highly trained, knowledge-based workers. Human capital is the most precious asset in the new economy. And just as all forms of capital are by nature scarce, so is the human kind.

ARSENAL OF SOLUTIONS

As a consequence, banks, insurers and other financial services are turning to battle-hardened IT staffing agencies for help and advice on how to recruit and hire in this new environment.

Job seekers, such as sales and marketing help, financial advisors and even CEOs looking for their next turnaround assignment, are now found on the web. On average, a job posting brings 300 applications, and it is not unusual for a couple of thousand applications to show up overnight for certain types of jobs. You can also bet that the best applicants in the pile will not be available for long.

Not surprisingly, the IT staffing industry has developed an arsenal of technological solutions to help deal with the high volume and urgency of web-based hiring. An array of technologies is now available to companies that have in-house human resources departments. The ultimate solution combines “recruitment management software” (RMS) with a delivery system called the “application service provider” (ASP). The ASP is a concept developed by IBM in the 1950s to outsource the use of its mainframe computers. The system allowed customers to tap into IBM’s computing power long before the advent of the silicon chip and the personal computer.

ASP ALTERNATIVE

In the Internet world, the ASP is the favored method of delivering computer-driven expertise on the web, and is a leading force in the business-to-business (B2B) e-commerce revolution. The market for ASP solutions is expected to reach nearly US$23 billion in sales worldwide by 2003.

Perhaps the biggest attraction of the ASP is that it requires no software or hardware to be installed or purchased by the user. In the case of the hiring wars, a vendor uses the ASP to provide its RMS solution online on a pay-per-user basis.

The result is an interactive hiring tool that goes a long way to helping organizations maintain a competitive advantage both in terms of cost and speed of hiring. It starts with a recruiter defining the parameters of a job offering and instructing the RMS to post the job on appropriate websites and job boards. When a job seeker responds to the posting, the RMS sends an automatic email response acknowledging receipt. It then continuously informs applicants of their progress in the hiring process, giving every applicant a sense of inclusion. On the recruiter’s end, the RMS automatically sorts the applications in order of priority or best prospects according to the recruiter’s original criteria. The process between recruiter and applicant remains interactive right up until the final outcome.

Advanced RMS applications can also search existing data bases of stored resumes to seek out the right talent for any given job project requirements.

WHAT TO LOOK FOR

There are number of factors in choosing any combination of ASP and RMS solutions. The most important factor is the scope of the entire system in meeting the needs of an organization’s business model. An APS provider or vendor should have a good track record and have a global reach in providing its service.

An ASP provider should control its own network. All other performance issues including expansion of users and software functionality can hinge on this question. Another paramount issue is security. Data and communications must be protected and remain in the domain of the client, even though the system is being supported or hosted from the vendor’s site.

A common challenge for ASP driven solutions is getting established professionals to adopt and integrate them into their working strategy. The easier the use, the more quickly an advanced RMS application will fulfill the promise of savings, which have been estimated at anywhere between 25-40% in the cost of hiring.

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