Episode 117: How Analytics, Data and Technology are Shaping the Future of Recruitment (interview with Kevin Wheeler)
On the show today, I am talking to Kevin Wheeler a globally known futurist in the world of HR. He is also Founder of Future Talent Institute, helping organisations create leading edge talent acquisition, employee development, and HR management strategies. With a focus on the future of recruitment, Kevin shares his ideas on a new model for talent acquisition as well why using Recruitment Process Outsourcing companies (RPO’s) can be key to gaining access to wider talent intelligence.
In this episode, we discuss:
The role of technology and marketing in talent attraction
How technology can help prevent human bias during the candidate selection stage
How we can go beyond traditional reporting metrics and pivoting towards predictive recruitment analytics
How HR can add business value as we start to transition out of the pandemic
Support from this podcast comes from eQ8. You can learn more by visiting:
https://www.eq8.ai/
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Interview Transcript
David Green: Today, I'm delighted to welcome Kevin Wheeler, Founder of the Future of Talent Institute, to the Digital HR Leaders podcast. Kevin, it's wonderful to have you on the show, we've known each other for quite a few years now. Can you provide listeners with a brief introduction to you and your work?
Kevin Wheeler: Sure. At the Future of Talent Institute, we try to look out at the mega trends and technology, economics, demographics, and so forth, that are going to have an impact on recruiting and learning and development and HR in general. We've been doing this for probably close to 20 years now. We spend quite a lot of our time just exploring leading-edge technologies and where they're taking the profession.
David Green: Great, and we're doing a deep dive particularly as that relates to recruitment and talent acquisition. But before we get into that in more detail, it would be great to hear about your career history, because obviously you are a forward practitioner, for those that don't know, and how you got into HR and recruitment in the first place.
Kevin Wheeler: Well, I guess accidentally, like most people! I actually started out in my career as a high school teacher, believe it or not, and left that after a short period of time, and got hired as a learning and development specialist in the semiconductor industry. And that's where I started my career in HR.
I moved from learning and development where I ultimately created the National Semiconductor University and built up a whole learning and development programme there, and moved from there into college relations, college recruiting and general recruiting; left the semiconductor industry in America and went to the semiconductor industry in Asia for a few years, and I spent quite a few years -- I was on the US Peace Corps in the beginning in Thailand, so I speak Thai fairly fluently. So, I was back in Asia, Thailand, working in the semiconductor industry.
Then, I came back to the US and went into the financial services industry and headed up recruiting and learning and development for the Charles Schwab Corporation. And, at the end of that period of time, I decided to go out on my own. That's when I started the Future of Talent Institute, and began consulting and working with companies all over the world, to try to help improve both recruiting and learning and development.
David Green: And presumably, that experience as a practitioner helped you take those big macro trends around technology and economics and demographics, as you said, and actually apply those into something that's going to resonate with recruiters, and learning and development professionals?
Kevin Wheeler: Absolutely. I mean, I don't think I could do what I do if I didn't have that practitioners' background and experience, not only experience in the field, but experience in the corporate world and how it works and how decisions get made, and so forth. And I think that's just really vital to being effective as a consultant and providing advice that's actionable, I guess the right word is, for other people who are actually doing the job.
David Green: Yeah. And we're going to be spending most of today's conversation talking about your ideas for a new model for recruitment. Can you provide listeners with a kind of overview of what this new model is, and why you believe it's important?
Kevin Wheeler: Well, first of all, let's just step back and look at how recruiting is done today. Unfortunately, in most companies, it's really a matter of trying to find, with a great deal of difficulty, increasingly so given the talent marketplace today, trying to find the round peg for the round hole; and I think a lot of frustration, a lot of anger even, amongst hiring managers and recruiters and companies for not really being efficient in doing that.
So, one of the things I look at is, what's going on in the whole world of recruitment and its relationship to technology and every other field, manufacturing, finance; they're heavily invested in technology and use it to augment and improve what they do. And recruiting is, I think, way behind in the adoption of those tools, and there's a lot of reasons for it.
One is, HR is always looked upon as an administrative overhead; it's not an investment opportunity from most companies' perspective, so it's hard to get budget. HR people are not technologists so they don't really understand the technology. So, when you really look at it, I'm not surprised that they haven't done it, but I think to break out of that cycle, we need to think about a new model for how we organise and run recruiting.
So, I think the first thing I propose is that HR hire a couple of different kinds of people. One is somebody with an IT background, who can really understand the technology and interface with the internal corporate IT function to integrate the products into the process. And I think right now, today, what happens is the HR goes to IT and they don't have the resources, "We're too busy writing code for sales [or] marketing", or whatever else and, "Sorry, guys, you're at the bottom of our list". So, the only way to change that is a dedicated resource to that, number one.
Number two, I think they need more data in order to make better decisions. So, a data analyst would be my next hiring, and I'm really kind of surprised that recruiting functions haven't lobbied for those kinds of resources, or traded a recruiter for one of those kinds of people, because I think it would make a tremendous difference in what they did.
Then, the second thing, which gets into another topic, but it's really about where you've got high volumes of similar roles. That's really inefficient to do that in the way that most corporations do it today. RPOs, or Recruitment Process Outsourcing organisations, I think are far better equipped to do that volume recruiting, not only volume, but particularly volume recruiting, in a more efficient way, and there's a lot of reasons for that. For one thing, they have invested in technology, which most corporate functions have not been able to do. And when you're making money, or trying to make money, the first thing you do is increase efficiency, and the way RPOs have done that is by investing in that technology and leveraging it to really lower their costs and improve the speed of what they do.
So, I would offload high volume, I would make the internal recruiting function more of a cross-functional partnership between a recruiter, who has some talent expertise, coupled with a hiring manager, and maybe coupled with some other, maybe a marketing person, that could help to promote that position externally. So, we really need to say, "How do we bring those elements into recruiting?" and they're both essential elements to be successful.
David Green: And, over the years, have you seen this improve, because we work with admittedly bigger organisations that have both those people analytic teams, they have those data analysts. Some of those are supporting recruiting, some organisations have a separate team that support recruiting with analysts; and again, some of these companies are hiring people with technology backgrounds to work in HR. Are you seeing an improvement; or, is it just in smaller pockets?
Kevin Wheeler: It's in small pockets. It's really with some large, multinational companies that really have extensive hiring needs, larger budgets, and probably leaders who are more experienced and better equipped to lobby for the resources they need. I think when you look at mid- to small-sized companies, it's virtually non-existent; and even in large companies that you would expect to have those resources, when you really look inside, they have an ATS, that's usually always there.
Other than that, they don't really have any significant resources, and very few have any, what I would call real data analytics. They have reporting analytics, no predictive, nothing that's really useful in terms of the analytics.
David Green: Without the right technology, and analysing the right data, is this part of why you hear people talking about a talent shortage? Is it a shortage of imagination, or a shortage of capability?
Kevin Wheeler: It's both, absolutely, it's a shortage of an inability to reimagine a job in light of the talent that's out there. And, it's a lack of resources to find the talent that does exist. So, if we take a typical job, if you look at a job description, let's just pull one at random out of some database 20 years ago and for a similar position and look at the requirements today for that same position, and you'll find that those requirements have significantly increased. We've added all kinds of layers of certificates and qualifications and years of experience that you need, and there's no real data to support the need for that.
If you could show me some real analytics that said it's absolutely essential, I would have no problem, but you don't. It's just a matter that hiring managers say, "I just need this and I want this and I want this". It's kind of like a little kid going to the ice cream shop and wanting everything in the ice cream shop. So somebody, somewhere along, has to say, "How do we put some limits on this?" or whatever.
So, I think number one is, with over-credentialled jobs, I think we have really -- and Google and Microsoft and many companies have already started to change that, and they've already removed the junk requirements. About 25% of companies have removed the need for a degree now from jobs. So really, that's a significant change. About an equal number, about 25% of companies have reduced the need for a graduate degree to an undergraduate degree. So, I think there's a lot more focus right now on hiring for skills and abilities, and even learning ability, than there is for hiring for past performance.
I think we've got to look at hiring for what you can do, not what you used to do, or did in the past. And we've got a very rear-view mirror of looking at everything in human resources, I think; it's all rear-view mirror. It's our reporting metrics of what happened last month. With the speed of the change in the marketplace and the world, those metrics are often not incredibly useful, and things change really quickly. So, how do we have more forward-looking metrics, how do we have more forward-looking thinking about the roles we need, the jobs we're going to fill?
So, I think it's a shortage of just a lack of really thinking about these jobs, it's just a rote thing. We pull out the job description and we publish it and we hire for that; we're not really thinking about it. I don't think many hiring managers or recruiters sit down and say, "Okay, let's zero-base this job, let's really think what we really need, what are the essential skills that we've got to have, and what are the ones that would be nice to have, but we don't really need them". I don't think we do that anywhere near enough.
David Green: The interesting thing about that, I mean, I've seen external research and seen it from companies who've actually investigated it, that the more requirements you put on a job description, particularly if you put them on in bullet points, there's research, and again forgive me if the numbers aren't exactly correct, but men will apply generally if they meet 60% of the requirements; again I'm generalising. Females generally only apply if they meet 90%, 95% of the requirements. So again, if you're trying to increase diversity and inclusion within your workspace, you may be knocking that off at the first hurdle by having those too many requirements.
Kevin Wheeler: Absolutely. I've seen similar statistics and clearly, women have a different approach. Also, the whole concept of transferrable skills, "I don't have this exact skill, but it's close enough that I could learn this new skill really quickly"; we don't take those into account, so you leave a whole pool of people who could, probably with a minimal amount of training or experience, do the job; we leave them out of the process totally.
David Green: And of course, the data's around now that can help you understand skills adjacency. If you said "skills transferrable", you might have skills one to five, which means your ability to acquire skill six or seven is actually not too difficult. So, if you've got a shortage of those skills in the marketplace, hire someone who's got those other skills, and you could probably help them grow the other two quite quickly.
Kevin Wheeler: And that addresses the other issue, which is the lack of learning and development capability in many companies that has, I think over the years, a lot of that has been removed or reduced, even eliminated in many companies because, "We're just going to hire talent, we're not going to build it". And the attitude is, "They just leave anyway, so why should we invest money in training people?" and so forth.
So, it's sort of a vicious cycle; we've almost created our own problem by not investing in development and learning, and not promoting internally and developing people internally, over-credentialling jobs, and then crying that there's nobody out there that can fill our positions. And with the world with a shrinking demographic and aging population, that's really a formula for disaster.
David Green:
So, you mentioned RPOs; so RPOs, particularly when it comes to volume hiring, particularly because they're investing in technology, particularly because they use data, I guess, in more abundance than your average company. Can you talk a little bit about why you think RPOs are good at doing this, and what has held companies back from using RPOs in the past; and is that changing and if so, why is that changing?
Kevin Wheeler: I think I'll address the last question first, "Is it changing?" Yes. There are several large companies I know that have outsourced almost 100% of their recruiting to RPOs, and I think that's a trend that's going to continue to grow. The reason goes back to what I mentioned a little while ago about cost and investment. But I think more than anything, and on top of all that, RPOs have really built vertical pipelines of candidates. They have the talent intelligence that companies lack.
Let's just say you're an energy company and suddenly you want to move into the renewable space. The chances are, if you've been in traditional energy, like oil or coal, you don't know anybody in the renewable space. So, the recruiters go out and they have to basically learn that whole market themselves; really challenging, very time-consuming and inefficient. Whereas, if you go to an RPO that specialises in energy, they probably already have a whole database full of people in the renewable space that they can screen and vet for your positions.
So, the talent intelligence piece, the talent pool, is a major contributor to the success of RPOs. And again, because they focus on verticals typically, many of them do, and they may have many verticals they focus on; but in those verticals they are really good, they are very in-depth, they know the people, they know the players, they know them in the geography that you want them in, and they have the technology to find them and assess them very quickly and very efficiently.
To me, if people ask me, "If you were the head of a talent organisation, again in a large company", I would immediately look for an RPO and I would decide what jobs are proprietary enough or strategic enough that we need to keep them inside, and then focus on those jobs with more of a cross-functional recruitment team; and I would outsource the rest of them to this RPO. But I really believe that the future of recruiting is going to move more and more to the RPOs.
Now, I'm sure some of the largest companies in the world will have the capability to do their own and that's fine, and RPOs may not be cost-effective for really small companies. So, it fits a niche, it's kind of a large- to a medium-large-company spectrum, but that's where most of the hiring, or a lot of the hiring takes place, a lot of the challenging hiring takes place.
So, RPOs have a very significant role to play and I think it's going to grow, and most of the RPOs have -- I mean, 20 years ago, RPOs were nothing more than glorified agencies, I guess I would say; they really weren't that capable. That's changed tremendously and the really good RPOs are very, very good at what they do.
David Green: Yeah, I mean I worked in that field for a while, and at the start actually, in the early-2000s, showing my age, and you're right; they were glorified agencies really, doing something a little bit different. Then obviously, you got the pure players coming in, the Alexander Manns, the Cielos and others, WilsonHCG I think is another one, isn't it? And I can see, having worked in that space, that those companies are continuing to grow and grow, and I guess the technology's getting better, so they can provide that value at that scale that even they couldn't provide six, seven, eight years ago.
Kevin Wheeler: Absolutely, and it's really all because of the internet, the data, the capability to gather this data, find this data. And of course the virtual and remote world has expanded that marketplace significantly; and if you're willing to hire people remotely, you have a much bigger talent pool to tap into.
David Green: So, what about those companies, and there are many, that have already invested heavily in building in-house recruitment teams? Are you seeing some of them moving to RPOs; or, do you see that as a trend that's going to increase moving forward?
Kevin Wheeler: I haven't seen any yet. I mean, there's a few larger companies that have outsourced a lot of things to the RPOs. What they've done with their internal recruiters is, the internal recruiters generally go and work for the RPO, so they're not really laying them off or reducing them, but they're changing where and who they work for. And then, the recruiters get better training as well from the RPO typically than they get internally.
But I haven't seen the biggest companies, other than in a particular vertical. A large company may go out and use the RPO for one type of role. Let's say we're an energy company and we don't know renewables, so we'll use an RPO for the renewable space, but we're still going to keep our normal recruiting for all the other things that we do. So, I think you're going to see it as an evolution, not a revolution. I think many mid to smaller companies, growing companies, may just adopt the RPO model from day one, for the most part. I think the larger, more established companies, it's definitely going to be an evolution.
David Green: So, RPOs is one area that I'm sure is something we could probably talk about for the whole time, but we're not going to; we're going to move onto the next area! Let's shift to talking about the impact technology and automation is having on recruitment. Now I know, because of having the pleasure of knowing you for quite a long time, Kevin, you're always ahead of where the market is around this.
There are a lot of vendors out there now that are specifically targeting recruitment teams, and we've seen some great case studies in the past, from companies like Unilever, on how they've used technology to support high-volume recruitment. Firstly, what are your thoughts on how technology can help with talent sourcing, and what is the role of recruitment marketing in this as well?
Kevin Wheeler: It's growing. I mean, the number of companies in the HR and recruiting space is just growing like mushrooms. It's amazing how much money is invested from the VC world and the HR and recruitment space right now. So, you're seeing a lot of interest and a lot of focus on there. So, the areas that I think are getting the most attention right now, number one is the talent intelligence piece that I just talked about: where are people located; who has the skills; and where are they? That includes internal employees as well as external people.
So, companies like GEM and Reejig that can scrape the whole universe out there of internal and external candidates, look at their skills, assess those skills, they could look at your internal profile, they could look at your LinkedIn profile, they could look at your Facebook profile, it could look at all sorts of stuff about you, with your permission, and give you an assessment of your skill capabilities, or what the transferrable skills are that you have. And those can be used by recruiters to help place you in better jobs, and can be used by you to help you look for different jobs that you didn't think you were qualified for.
So, I think that's a really interesting and growing area, and really only possible because of AI and technology that can scrape all that data and then make sense out of it. I think what's amazing is, we don't even know what our own capabilities are in many cases. So, finding those things and giving you a nudge is really a helpful way to ease the talent shortage.
In terms of marketing, HR is really bad at that. I don't think recruiting has any idea how to do marketing really. So it's about, how do we engage candidates; how do we reach out to them with more effective messaging? And again, a lot of AI is being involved in helping in that process. It tracks, what's our EVP; or maybe more specifically, what's our job VP, what's our job value proposition? So, why would a renewables guy want to come work for an oil company? So, trying to figure out what would attract that person? Again, they can do a lot of analysis on the web to find out the things they look at, the things they click on, what they're interested in and maybe tailor your marketing message, just like product marketers have done for decades.
So, it's using basically the same technology that's used for product marketing, to use it to market a job to a candidate. I think we've always had this concept that it's a one-way street. You have to knock on the door of the employer, the employer doesn't have to knock on your door. I think in the last decade, that's changed a lot, and it's changing even more today. So, we talk about a passive candidate; well, everybody that bought anything was a passive buyer. When you're an active buyer, you go in the store and you buy it; that's not an issue. Passive buyers are far more valuable, and so how do we reach out to these candidates who don't even know you exist?
David Green: Yeah, it's interesting, it leads on nicely to the assessment and selection piece now around how technology's supporting that. Obviously, we've seen companies out there really help transform how organisations do that, whether they're working directly with an inhouse team or through an RPO, potentially open up a more diverse talent slate, shall we say. If we're looking at, there's a great story about how Unilever traditionally recruited for their leadership development programme, through just eight main schools; and then by using different technology, how they are able to literally widen that and get a more diverse slate coming in as well.
Would love to hear your thoughts about that, but also related to that, how should companies approach the need for the ethics around that, ethical AI, and how to avoid falling into traps where technology can replicate human bias, which obviously should be the reason for using technology to try and eradicate human bias, not to replicate it. There was a famous Amazon story a few years ago on that, wasn't there?
Kevin Wheeler: Yeah, absolutely. You know, I think interestingly, there are several organisations now that actually certify algorithms for being ethical and unbiased. There's companies; Reejig is one that's really advertising very boldly that all of their algorithms have been certified as ethical by these organisations. I think you're going to see a lot more of that.
Historically obviously, companies have guarded their algorithms, because they're like your secret recipe for Coca-Cola, right, that only two people in the world know what that recipe is. But maybe it's okay, hopefully one of them is the FDA, or somebody that inspects them first for safety and health. But the bottom line is that a lot of algorithms have been blocked boxes and we don't have any idea what's in there. And because AI learns from past data, if your past data is biased, then your algorithm will be biased.
So, you really have to make sure your data set is huge and diverse, and getting these things certified is, I think, a first step in the process. I think you're going to see a lot more technology saying, "We're certified as ethical". I think that the whole assessment process needs to be built on data, obviously. And the data, unfortunately, is just now in many companies being collected. So, who is your best employee? How do you define the word "best"? How do you determine performance, and how do you verify the qualities or traits that led to that performance? Then, if you really have that nailed down in a valid, verified way, then the technologies can be very effective in finding people that match those same traits and characteristics.
The challenge there, of course, is how do we make sure we're just not hiring clones; how do we make sure we bring diversity in? So, you have to allow some fuzziness around those things in order to bring that diversity in. So, it's not a simple solution. The ideal dream is you just push a button and they assess your skills and, "Yeah, you're the best guy, David, you're hired". I don't think that's ever going to happen and I don't think it should.
But I think what they can do is help us to get away from, "I just happen to like that sweater you're wearing today, so I'm going to hire you", kind of thing, which happens, I think, for many jobs. It's a very unscientific and highly biased approach that's probably 80% of all hiring. No matter how much we think it's objective, it's not, because we're all subject to personal influences, personal biases, "I like tall people, short people, I like women more than men [or] men more than women", whatever it is; we all have some bias. So, the technology can help to eliminate that at the beginning of the process; it can never eliminate it completely at the end of the process.
But I think we can certainly bring a larger and more diverse pool of candidates in to be recruited by using more objective testing and technology to do that, based on skills, competencies, traits that we know are required or necessary or vital to being successful at the job.
David Green: And I guess what we need to do, and we'll talk about analytics in a minute, but we need to be really validating any tools that we are using on an ongoing process and challenging them where necessary. It's interesting, because in the States in particular, we've seen New York bringing in legislation around using AI in the hiring process. The Equal Employers Opportunity Commission, I might have got that wrong, they're now looking at putting in legislation I think around the use of AI. I think they were initially looking at recruitment, but they've now broadened that across the people space. What's interesting there is, the Commissioner is actually working with the technology firms, with practitioners, to do that, rather than just imposing it on them. It's a topic that's not going to go away, is it?
Kevin Wheeler: Not going to go away, and it really focuses again on the fact that the Director of the EEOC, I believe, came out just a few weeks ago with a statement saying, "We really believe in and support the use of AI, but we want to make sure that the algorithms are ethical and unbiased". So, I think the focus is really going to be on, how do we really validate that the AI is doing what it's supposed to be doing, and not being just as prejudiced as the individuals can be.
But I think in the end, ultimately, we'll muddle our way through, and it will be a muddle. It's not going to be a perfect process, but I think we'll reach a point where the algorithms are better than we are, and less prejudiced in their bias than we are, and that alone will be a huge accomplishment and open the door up to lots of people who don't have the opportunity to get hired now. I think that that focus is interesting, because when the government gets involved like that, then you know it's a trend that's here to stay and that it's a serious trend, and that somebody's really taking a look at it.
They can be misguided in the law and rules are always behind the technology, they always act as a counterweight. In some ways, that's good, because it ensures that things move in a more fair way. I know a lot of technologists get really frustrated, because they look at it as throwing impediments in front of them. But every technology's faced that: the automobile, the automated looms; every technology has faced legal and rule challenges to it. But inevitably, they always continue to move forward.
David Green: The next topic is one that obviously we've spoken about in the past, around analytics. You've talked a lot about the talent intelligence data that's supporting leading companies around analytics, and some of the specialist companies that are actually providing that talent intelligence as well. So, we've seen great strides in the people analytics space in recent years, but a lot of recruiting leaders still talk about time to fill, cost for hire. But what innovations are we seeing in the recruitment analytics space; and how is this technology helping?
Kevin Wheeler: Well, I think the movement is slow. It's slow, but it's definitely moving in a good direction. I think we've probably -- I'm just making a complete general guesstimate here, but I would say that 80% of all companies, at best, are doing reporting metrics. Many of them don't even have good ways to capture that data. But I think more and more companies are at least moving into being able to use that data to help them look into the future to some degree. They're saying, "If we hired 50 people like this last year, how many are we going to need next year?" and being able to make those -- and I say right now, they're guesstimates, rather than really good database estimates. But at least they're making an effort to do that.
A handful of companies are actually moving into getting enough insightful data, figuring out how to access their big data, to clean it up and analyse it, and actually at least make some very rudimentary predictive analytics, that are really based on data. I don't think it's a lot of companies yet doing that; you may know more than I do about all the ones that are doing it, but for sure there are companies working doing that.
As we move beyond predictive, I don't think we have much going on there yet. I think that's another five years or more away before we get there, maybe longer, into prescriptive analytics or anything like that. But I think the descriptive analytics, reporting analytics, they're getting better, they're more accurate. I think many companies are now aware of their need to use data to make some of these predictions.
But I think more than anything, if they're gathering data to look at what are the skills that really differentiate a good performer from a not so good performer, I think that's maybe where it's playing out the best right now. So, if we can actually give tests or analyse the best performers and what they do and what they contributed, and figure out what was the trait that led to that, I think that's a huge improvement in being able to select people that have similar skills or traits, rather than just guessing why that person is better.
The big mystery, I think, that every recruiter and HR person has faced is, "Why is this person better than those other two? What makes that person a star performer?" and I think we really, historically, have not had any good understanding of that, just our own bias, our own opinion. I think now, we're able to get that data, we can actually look at what they did, what they accomplished. So, we're making good strides, but I think we have a very long way to go for most companies. Most companies are -- I've worked with a lot of clients that they don't even have access to the data, they don't even have Google Analytics.
So, it's really amazing to me that when you ask them, they go, "Do you think Google has Analytics? I didn't know that", and these are some HR people that just really don't know that. So, things like how many people came to your career site; things that they're not really people analytics, but they're marketing analytics, who clicked on what? We don't even have that data, so we've got a long way to go to do that, but a handful of companies are doing much better at it. Unilever's one; there are others that are definitely investing more energy and effort in that. It will definitely pay off for them; it's a competitive advantage if you can do that.
David Green: And it's interesting, isn't it, because time to productivity, for example, would be a metric worth understanding, and why are certain people more productive, quicker than others; is that them? Is that the individuals that we're hiring because they have certain skillsets; or, is that the environment that they're in? So, I mean there's lots that you can collect data around to understand that.
I'm wondering, I've worked in the RPO space for quite a while, but one of the challenges I saw that was in the RPO space, it was the challenge of the race to the bottom, it was all about cost for hire as a way of putting fees down. I wonder all these years later whether the RPOs are changing the conversation at all by educating their clients on looking at other metrics, rather than time to hire and cost for hire, and whether they're actually helping them understand the value that they provide beyond the economies of scale that they give as well. I don't know if there's any sort of -- you obviously don't need to mention names; I don't know if there's any interesting initiatives that these RPOs are doing in helping to move the discussion forward a little bit?
Kevin Wheeler: I think they're trying. I think the two big ones, two that you already mentioned, are doing a lot in that space, trying to do a lot in that space. I think the real challenge comes internally, as well as from external, is that, what is the cause of lack of productivity, let's say, in this person? Is it because of the hiring manager; is it because of budget; is it because of internal bureaucracy; is it, this person is more productive because he has a great boss and a great budget; or, is it because of some other thing? So, separating the wheat from the chaff, I think, separating the real person capability versus those environmental things that you talked about, is the real challenge for most organisations.
Let's face it, most of the recruiters I work with are overworked, they've got tons of requisitions, and the last thing on their to-do list is to go try to figure out that stuff, right. All they're trying to do is to get a person in that job before the hiring manager screams so loudly that they get fired, and that's unfortunate. But it's really the reality right now in this marketplace. If you're looking for hard-to-find talent, your day is totally consumed with just not trying to improve the system, but just survive in the system, and that's really a shame, because we're not making breakthroughs that we should be making, like reassessing the jobs and the skills and just looking at the workforce, expanding the definition of a workforce to include the gig workers. These are all challenges.
Most hiring managers just want to hire a full-time person, even though they may not need a full-time person, but nobody really challenges them on that, or suggest that they bring in a consultant or a contractor to do that. So, I think it's about recruiters in most companies right now are just overworked.
David Green: That kind of brings it to the next question, that brings some of this together. So, when we think about all the innovation in the space, and there is so much innovation going on, let's be honest about it, why are so many companies still hesitant to advance in this area? Some of the tools that we talk about have been around for five, or maybe even more years; why aren't more companies investing, for example, in recruitment automation?
Kevin Wheeler: I think two big factors. Number one, I'll sort of combine them together, even though they're sort of separate, is time and money. When you're overworked and scrambling, you just don't have time to think about how we could implement a piece of technology here. And the second thing is the money to purchase it. I'll combine with that a third piece, which is the skill to do it; so: time, money, skill. Those are the three initial hurdles, I think, to doing it.
I think there's one that sits on top or underneath all of this, which is your own personal bias and your own opinion that, "I don't want to put myself out of a job", or, "Recruiting is a people function and I need to be talking to people. I think machines are in effect evil or impersonal and not good", and there's a lot of that. So, when you combine the fact that first of all, I'm really busy and I really think it's all about people; and then I don't have time, money or expertise; then it's very easy to say, "I'm not going to put any technology in", or, "I'm not going to focus on the technology".
I think it's slowly changing; I think that interest in things like a chatbot is growing tremendously, because those are perceived as front-end helpers that augment the process. You eliminate a lot of unqualified people from getting through to me, so I can spend more time on the qualified people. I think those things are trying to make a little bit of progress. I think using some screening tools upfront, whether it's gaming or simple coding tests are helping to improve that process.
It's coming in incrementally in little places, programmatic job advertising to advertise jobs, automatic job posting to post jobs out there, things like LinkedIn Insider giving them a little bit more talent intelligence than they had before. So, there's little incremental things that are technology-based that are helping. But to go ahead and say, "We're going to just really sit down, look at our process from beginning to end and figure out where can we implement technology effectively, what tools could we use" rarely ever happens. It's more of a hit-and-miss prospect, where we have a tool here, a tool there. They may not even be compatible or talk to each other, so we've got a lot of that.
We've got another big issue in recruiting, which is the turnover of recruiting leadership is very high. So, I start out a technology implementation and I quit and go somewhere else. The new person comes in and says, "This is crap, I'm not doing it", or doesn't understand it. So, you've got all sorts of factors going on, impacting the speed with which technology gets implemented in recruiting. Could we have an 80% automated recruiting process? I think we could. Could it still have people touching people? Absolutely, I think that's all very doable. But I don't know of anyone who's even come close to doing that.
David Green: So, I'm not going to ask about the 80% on this one, but that leads to the next question. What are the companies that you think are doing this well, that are embracing talent intelligence? Can you give our listeners a couple of examples of companies that have really embraced the key aspects of your new recruitment model and are leading the way?
Kevin Wheeler: I think you mentioned one earlier: Unilever. It's done a lot in that space. Microsoft is doing a lot in the analysis of skills and what they need. Amazon has done a ton. I know they got a bad rap a few years ago for their AI faux pas, but I think that's been rectified to a large degree, and I think they're pioneering a lot of the hourly and volume assessment, it's all done through online tools now. Very interesting if you apply to work in a warehouse, or whatever, it's pretty much an automated process; you'll never even talk to a recruiter at all.
So, a lot of that is happening at that entry level, manual labour point, where you just go through a chatbot, or a series of questions. You may take a test and if you pass if, you get an offer letter in the mail; you never talk to a recruiter at all. Some people think that's horrible, other people think it's refreshing, so it just depends. Google has done a lot in that space, certainly in the analytics of what's required to be a good employee in that space. I think IBM has put money into this, in trying to do some screening and so forth of candidates.
It's a lot of the bigger companies that are really investing in this, and technology-oriented companies. I don't think you're going to find much of this in the energy world, or the healthcare world, or advertising world, not yet; but it's the companies that already have the technology skill and knowledgeable people to implement it that are doing it.
David Green: It's interesting, because obviously Amazon did get a bad rap, as you said, but at least they were validating the AI that they were using, and then they removed it, because it was actually doing the wrong thing. So, how many companies out there are using this and not validating it? And it's interesting you mentioned about Microsoft, back to the conversation we were having earlier around looking at time to productivity.
There's some stuff out there, you've probably seen it, Kevin, that Microsoft actually started to understand the role of managers in that time to productivity, and they found that managers that had regular one-to-ones with their new employees had employees that their time to productivity was shorter. Well, who knew, if managers spend time with their employees?! But it's great, because then the data's there, and it kind of creates those good habits, I think, in managers, when they hire people around that, which is so, so important.
So, if our listeners are keen to explore some of the new recruitment technologies that are out there, and there are many, what are some of the newer innovative tech vendors they should be considering that they probably haven't heard of yet; and what problems are they trying to solve?
Kevin Wheeler: Well, I think a couple of the interesting ones are Reejig, which is a new Australian intelligence platform; they're really innovative and they have competitors like GEM, which is also in the similar space. So, that's a whole new category that's just actually been defined recently as a category. So, I think that's one.
I think there's a whole lot of improvements in the chatbot space out there, and I think there's many chatbots now. I don't even have any idea how many, but there's a few dozen available out there. But the big ones, like Paradox Olivia, are really I think exceptionally good at what they're doing, and getting better and better at assessing and answering candidate questions and giving them feedback right away.
I think tools in the reference checking area, like Checkster, again not a new company, but not a very well-known one, that does an anonymous 180 sort of check on someone, not based so much on, "Did you like them?" but, "How would you rate them on their strategic --", whatever is important in that job. So, "How would you rate them in their coding skills?" or, "How would you rate them in their strategic thinking capability?" companies like that.
Some of the interesting stuff that's coming, that I don't have a company name behind it right now particularly, is bio assessment, looking at maybe to verify who you are, to speed your hiring process and the onboarding process. It's using biometrics to make sure it's actually you. I think we're seeing this on the Apple phone and things like this, where you can use your Face ID to login to all sorts of sites.
Imagine if you could go to a site and apply just by your face, because that data exists, let's say, in the blockchain. All the data about me exists in the blockchain and I go to your career site, and I take a picture of me and it populates my entire application. So, I think you're going to see that coming in the very near future; that's pretty fascinating. I think more use of the blockchain stuff is going to become important in security and keeping us honest, I guess the right word is.
So, I think the online coaching and feedback, which isn't necessarily a recruiting-particular process, but can be used in that process to determine what your skills and capabilities might be. But Web3, which again is sort of again related to blockchain, is going to provide a whole other level of security and so forth; very, very new, very edgy, nothing tangible in terms of a product yet. But look for companies focusing on those things in recruitment; I think you're going to see a lot of that.
Virtual and augmented reality, big deals, I think they're coming, being able to give someone a virtual tour of their job, or put them into a job experience. This was pioneered in Australia BHP, they pioneered this with coalminers, where they actually put them into a virtual environment of being a coalminer, the candidates, and it was really because the turnover rate of coalminers is very high, as you might imagine. As soon as they actually entered a coalmine virtually and saw what the job entailed, many people decided not to apply. So, it really reduced the turnover rate tremendously. I think you're going to see a lot more application of particularly augmented and virtual reality in the very near future, and you're seeing things like the new Apple and Google virtual glasses are coming out, and so forth.
There's going to be a lot of innovation in these edgy areas around recruiting, and we're going to look back and think that an applicant-tracking system is really a horse and buggy, you know; pretty old-fashioned stuff!
David Green: Lots to look out for then. Now, this is a question we're asking everyone on this series, Kevin. What do you believe to be, and you can just broaden it to HR now; what do you believe to be the two to three things that HR will need to do to really add business value as we hopefully come out of the pandemic?
Kevin Wheeler: I think number one, they've got to really re-examine what the words "work" and "workforce" mean. Right now, I think we just have a very traditional view of eight-to-five employees permanent. I think that's really archaic, and we really need to whole new model of what the workforce is, and what is a worker. Number two, which goes along with this, we've got to really focus on hiring for skills and capability, not for what you did yesterday; and I think the whole idea of credentials, degrees and years of experience, it was valid in a linear world, but we're not in that kind of a world anymore. When you're in a world of chaos and change, you need a very different kind of person.
So, those are the two probably most important things for HR to do. And all of that has to be based on a much better use of data, much better understanding of people and what they're capable of doing. And I'll add a fourth one just in here, we've got to really stop thinking about the physical workplace, unless it's critically necessary to make something. I think we just really -- I'm really surprised at this arbitrary demand that people come back to work when they're totally happy and productive working from home.
I get why people my age are doing that, but I think we're wrong, and we need to be a little bit more open about allowing people to work, if we're going to keep a good workforce.
David Green: Yeah, it's going to be interesting to see how that plays out over the coming years. It's almost like the genie's out of the bottle now, isn't it, around remote working; and as you said, people like it, people say they're more productive, and actually the data shows that people are being more productive as well. Yeah, it's going to be interesting. But then you've got the whole thing around collaboration and innovation, and the technology is improving all the time to actually support that as well.
Kevin Wheeler: Absolutely, but it's a matter of being choice, not forced. So, if I have a choice where three of my colleagues, we want to go -- and it doesn't have to be to work, it could be to a coffee shop; we're going to get together somewhere and collaborate on this project, why does it have to be in our cubicle? I think a lot of it is, "We invested all this money. My God, what are we going to do with our building?" is part of it. There's so many things, the tax-rated cities, all the restaurants and shops that go out of business, because people aren't there; many spinoff effects that we haven't even begun to see play out yet, when you have a deserted downtown London or a deserted downtown San Francisco. It's going to change the whole character of life and cities.
David Green: Kevin, it's always a pleasure to talk to you. We've learned a lot from listening to you, and thanks so much for being a guest on the podcast. Can you let listeners know how they can stay in touch with you, follow you on social media, and find out more about your work?
Kevin Wheeler: Absolutely. Go to www.futureoftalent.org, which is our website. And from there, you can subscribe to our free newsletter that I publish each week. And I'm on Twitter @Kwheeler46. I'm on LinkedIn, I'm on Facebook, so you can find me pretty easily.
David Green: Brilliant. Well, Kevin, thanks so much for your time and, yeah, look forward to hopefully seeing you in person at some point in the not too distant future.
Kevin Wheeler: I hope so as well. Thanks very much, it's been fun.