New model to slash hiring costs in SA

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A new recruitment model that is widely used in the UK and Europe is being rolled out in South Africa and will dramatically cut the costs of recruitment.

Hilton Brown, Chief Executive Officer of Adcorp Talent Resourcing (ATR) who has over 15 years experience in recruitment, including 10 years at London’s leading headhunters, says that the new model will typically save South African companies "hundred of thousands, even millions of rands a year’ in the recruitment process.

"Traditionally when companies look for talent, they engage a recruitment agency and pay them between 15 - 20 % of the annual salary of the successful candidate as the finder’s fee.

"But we’ve developed a much more cost-effective, piecemeal selection process model out of international best practice and what our clients are demanding from us.'

ATR recently recruited 40 staff for a large private IT company. "The traditional methods would have cost the company millions, but due to our new processes, it cost them R35 550 per hire as opposed to R60 000 - assuming a conservative estimate of a 15% placement fee.

"In another case, a public sector client asked ATR to sort, screen and capture 500 000 CV’s for 1032 positions. The project cost the client R1.5 million as opposed to recruiting the traditional method for which they had budgeted R8 million.'

Brown says another brief required ATR to screen and capture applications for 5023 positions for a public sector client in various districts in Gauteng. "Close to 465 000 CV’s were processed and broken into A and B lists and presented to the client". "The project cost was R7 million as opposed to R20 million via traditional recruitment.'

Brown notes that with the new model, recruiters can either pay piecemeal for each service chosen, or they can outsource the entire hiring process to one company, which he says is preferable.

"The growing demand for a new recruitment model is in the rise out of a sense that the traditional hiring model is not always satisfactory as it is expensive, time consuming and the incumbent agency will often have to outsource the many steps in the employment process to a third party which dilutes the efficiency and control of the hiring procedure.

"And a typical recruiting agency will often try and save costs by mining their existing databases for candidates - often bypassing advertising for suitable job seekers who are unaware of the position.'

The major difference in the new model is that a client will pay for each step in the recruitment process through the duration of the project and this is not only substantially more cost effective; it also speeds up the hiring process, targets the right candidates and allows one agency to oversee the process instead of disparate people who don’t always fully understand the brief.

"Another advantage of the new model though is that because candidate search is driven through our existing jobseeker database and assessing respondents to adverts, job hunters are quickly processed and the client can usually start interviewing the shortlist within 12 days of the advertisement appearing.

"The traditional approach in most instances will take longer than that as there is less of a focus on timelines.'

Brown says that more and more clients are demanding a collaborative approach when it comes to recruitment and that demand for a one stop recruitment shop that can devise a sourcing strategy, a screening and short listing process, select suitable candidates and assists in final recommendations is on the up.