Musings About Talent Acquisition and Employment In Canada’s Real Estate Industry
by Forbes Rutherford, Rutherford International Executive Search Group Inc.
A. Selection Ratio and Cost per Hire
1. War for Talent
What concerns me with respect to the future is the scarcity of high performing talent at all levels of the corporation. Identifying talent and then transferring institutional knowledge through effective succession planning has become a strategic imperative.
2. When to Use and Not Use a Headhunter
To determine your talent acquisition approach consider the following:
- the strategic and/ or tactical importance of the position;
- the urgency to fill the position;
- and ultimately the cost to hire.
If the role is strategic and has a direct impact on profit and loss, consider an executive search partner. If the responsibilities of the position are tactical but the need is urgent, consider a standard recruiting agency. If time is on the side of the employer, then an effective job marketing campaign should suffice in order to keep the cost per hire at a minimum.
3. Driving Down the Cost per Hire Through SEO and Employer Branding
The cost per hire is a direct charge on a firm’s bottom line. This cost, however, has dropped dramatically with the advent of job boards, in-house recruiters, social networks, career advertising and search engine optimization. Much like traditional recruiting agencies, we package these tactical recruiting tools among others into our direct methods. Unlike other agencies, however, NEXTalent passes these savings on to the client.
B. Cost to Fire is Rising Exponentially
1. Cost to fire is rising exponentially relative to the cost to hire.
As much as cost per hire is rapidly declining, the cost per fire is rising exponentially. The associated contingent liabilities that attach to the bottom line are considerable and lingering. Enabling our clients to hire right is fundamental to reducing your overall cost to fire.
2. Impacting the Bottom line Through Science Based Hiring
You can improve a person’s education through courses and mentoring, you can improve their experience by exposing them to more responsibility; however you cannot improve or modify their behavior. While minor adjustments can be achieved, the behavioral DNA of an individual is relatively hardwired by the mid-twenties.
Through Rutherford International’s talent acquisition advisory approach, we apply science based hiring methods utilizing advanced assessment tools that have an 85% predictive accuracy for identifying high performance.
C. Economic Realism
Having conducted executive search assignments in real estate spanning major global markets since 1986, one becomes intimately familiar with economic cycles. You don’t live through a full real estate cycle without learning that there is a correlation between gravity and finance. By its very definition, markets do cycle. We cannot assume otherwise.
Even a modest shift in capital fundamentals and inputs such as energy will test management’s effectiveness to control an asset’s NOI.
D. Institutional Knowledge Transfer
1. An Aging Demographic
We have an aging managerial and executive demographic. I’m not convinced key executives pushing into their late 50s will hang around through the next financial correction. Talent gaps weren’t apparent in the 2008 financial crisis as most executives remained. They weren’t prepared nor ready for gearing down with their nest eggs severely eroded. However the markets have made them whole, it’s not likely they’ll be caught again. In fact, many are liquidating and lowering their risk threshold in preparation for gearing down or outright retirement. I expect we’ll see a significant exodus of talent and institutional knowledge from corporations at all levels over the next five to ten years. Capturing this institutional knowledge along with hiring a workforce that is resilient to change is fundamental to a corporation’s ability to sustain its market position.
2. The New Guard and Managing Generational Expectations
In general Canadian real estate professionals under age 47 (not the case in the United States) have yet to experience a rapid cracking of real estate fundamentals. When they do, there will be few old guard left. There is no reason to assume, however, that the new guard can’t navigate through a downturn. They are bright, aggressive, collaborative and better educated. The question management needs to ask itself in preparation for the future is, ‘Do I have an organization that measures its worth by its resilience to adapt, or is it caught up in its entitlements?’ This is a behavioral question, the answer is easy to determine.”
E. Succession Planning and Benchmarking Winners
1. High Performance Attributes as Defined by the Function
Navigating effective organizational succession planning within a transitioning industry through internal promotion and external hiring requires an understanding of the unique combination of high performing behaviors required for each key function within the top and bottom tiers of an organization.
2. Benchmarking High Performance Through Behavioral Science Research
Rutherford International’s NEXTpath division is the leading sponsor of a North American wide behavioral research study to benchmark the high-performing competencies found in critical real property functions. We currently offer access to psychometric benchmarks which span the high performing competencies of 3000 executive, management and staff functions including some real estate (retail leasing/development/project management), construction and investment functions. Grounded in thirty years of behavioral science research with statistical validity founded on actuarial science, the predictive accuracy of our benchmarks for determining a person’s on-the-job performance is 85 percent.
F: Changing the Talent Management Paradigm
1. Wading Into the Deep End of the Talent Pool
The Rutherford Group of Companies consists of a vertical of specialized executive search, talent management and recruiting firms that complement each other at various stages along the recruiting value chain. Each firm offers clients a varied approach to talent acquisition at a different cost per hire.
By adapting your point of entry onto the recruiting value chain, our methods let you ‘test the waters’ before jumping completely into the talent pool. Depending upon urgency, your first point of entry can be the running an ad on our international job board (www.rejobnet.com) for as little as CA$499.00.
2. Phased Talent Acquisition Including Proactive Recruitment
Alternatively, you can engage our talent acquisition firm (www.nextalent.ca) to implement a job marketing and employer brand management strategy to target market your position to relevant candidates; or if timing is critical we offer a full service recruiting campaign with our experienced recruiters.
Not every assignment requires a full service recruiting program. Properly staged, the cost savings of the NEXTalent program offers significant savings. A job advertising and employer brand marketing campaign through NEXTalent Inc. is equal to the cost of an average career ad in the Wall Street Journal.
For Additional Information, please contact:
Forbes Rutherford – firstname.lastname@example.org or 855-256-5778 EST.