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On a Mission To Search & Employ
Area companies seek new tools and methods to find and hire the best talent
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Business New Haven
2/4/2002
By: Nancy Barnes
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When global pasta giant the Barilla Group first came to the United States, it retained the New Haven office of Dunhill Search International to recruit personnel for its Norwalk office (which became the company's American headquarters) as well as for operations out of state.
“They had no sales representation,” recalls James Kaiser, Connecticut general manager of the Long Island-based recruitment firm, which opened its office on the New Haven Green in 1978. “They had nothing except a secretary and a vice president. We put all regional sales in different parts of the country and helped them with distribution as well. We also hired a director of logistics in Norwalk and employees in Los Angeles and Chicago.”
Barilla America Inc. (which relocated its American headquarters to Lincolnshire, Ill., in 1997) continues to find employees through recruitment firms today. According to Renée Papp, human services representative at Barilla's Lincolnshire headquarters, the corporate office filled 60 percent of its vacant positions with assistance from search firms last year.
Barilla does not use search firms to find employees such as secretaries and clerks or lower-level positions. For those the company advertises in newspapers and on Internet specialty sites, such as those belonging to trade organizations. “We have a sales force all throughout the United States,” she says, explaining that the company relies on search firms to locate them.
Papp notes that her company also uses employee referrals to locate talent. “We actually have recently hired someone from a food firm that was [ceasing operations],” she says. “The employee brought other candidates with him.
“Employee referrals are fairly common, especially now, where there are whole groups of plants and offices closing,” says Papp. “If Kraft lays off people, we usually know about it. I think food companies, especially in the Midwest, have a gauge on who's hiring and who's laying off.”
But she seems confounded by the prospect of a bald, unsolicited résumé crossing her desk. “If you just had someone on paper…” she says, her voice trailing off.
For larger companies such as Barilla, search firms and employee referrals are, overwhelmingly, the mechanisms of choice for locating and recruiting business talent. The former companies like the screening that the latter methods provide, and they view them as cost-effective. Yet it is not just firms that are entering new markets, such as the pasta-maker, rely on these recruitment tools.
Brian Lee is chief market strategist at the Stamford-based Hunt-Scanlon Group, where he oversees industry reports on executive-search firms. His observations support Papp's analysis of how her company hires. There are thousands of search firms in this country, Lee notes, and they function on all company levels.
“The executive search firm originally was an old-boys networking tool,” he says. “It wasn't widely used. It was a secretive process. In the late 1980s and 1990s, as the information age evolved, it became a more widely used tool by corporations to find people.”
Lee explains that improvements in telecommunications, such as the growth of the Internet, e-mail and the online or electronic résumés, helped to fuel the growth of the search-firm industry.
And, like Papp, Lee also favors employee referrals. “Employee referrals bring in people who are similar to the current employees, and it's very cost-effective,” he says. “Networking is a much cheaper means for the company to attract people. But that's usually for the job seeker. The onus is on the job seeker to get out there and sell himself.”
Companies turn to search firms, Lee says, when they are filling a position that is unusual or new within their industry. As an example he cites Yahoo!'s selection last year of former Warner Bros.' co-leader Terry Semel as its new CEO. Although some analysts criticized Semel's lack of Internet experience, the company hoped Semel, who had helped Warner Bros. expand into television and other media, would help Yahoo! to diversify into new enterprises.
“When companies look for a change in overall strategy and they want to go outside their industry, they go for a search firm,” Lee says. “The search firm has contacts in a wide variety of industries. Executive recruiters hear about great people all the time. They have the ability to find candidates based upon the descriptions that clients give them.”
One business in south central Connecticut that approximates Lee's profile of today's search firm is Andex Technical Search, based in Milford. Founded in 1994, Andex recruits technology or technology-related professionals for companies such as the Oracle Corp. and Pitney-Bowes. About a quarter of its clients are small businesses.
Andex' founder and managing director, Harry Anderson, cites another reason why companies turn to search firms to help them recruit candidates: the confidentiality with which the firms can conduct the process.
“Right now, we have a search for a company in New York City,” explains Anderson. “They're not advertising the position [Andex seeks to fill]. We'll do it confidentially so no one on the outside or the inside knows the search is taking place.”
Anderson says that search firms themselves use the employee-referral system touted by both Barilla's Papp and Hunt-Scanlon's Lee. “We have a database of names, and we'll ask them, 'Who do you know?' And that's how the process starts.”
Anderson adds that job seekers who are not in search firms' databases need not worry that they will be left out of the recruitment process. “Besides advertising” - Andex uses the Internet - ”we will go to client-companies and say to employees, 'Who do you know?' If you have 30 searches in a year, maybe you'll get five to ten off the database, and the rest will be new people,” he says.
John Tirinzonie, director of job development for the state's Department of Labor, has his doubts about the effectiveness of the Internet as a job-matching tool. He says he has read articles about employers who were deluged with electronic résumés after posting positions - or of job-seekers who failed to take their résumés off the Internet after they had been hired. And, like Barilla's Papp, he is inherently skeptical of the résumés that job seekers offer because he knows that people can and sometimes do inflate their backgrounds.
What Tirinzonie does not dispute is the value of employee referrals in today's increasingly tight job market.
“That has been a very strong area right along,” he says. “They used to call it the 'hidden job market.' “If you have a worker who you know is a very good worker, and he recommends someone, you'll probably go with that individual before you open it up to the outside world.
“The majority of referrals are made by direct referrals or references from someone the employer knows,” Tirinzonie explains. “Having someone known to the employer act as a reference for an applicant certainly gives that applicant an advantage.”
And he emphasizes the value of meeting job candidates face-to-face. “There are a lot of people out there who are very sharp in their people skills,” he says. “They can talk to someone for a few minutes and decide whether they're a very viable candidate. I have done a lot of hiring here, and I go on that gut feeling. At least you get a feeling of whether you have a candidate with strong potential.”
Tirinzonie explains that many larger businesses gutted their human resources departments in the early 1990s because so many other recruitment options opened up to them, and many of those options saved them time and money.
“We were not in the business six years ago of running job fairs,” he says, referring to the career fairs that the Department of Labor organizes throughout the state. “Now we do 12 a year, and we sell out.”
At the job fair Tirinzonie organized in New Haven last autumn, both large companies, such as New London's Electric Boat Co., and smaller companies, such as South Windsor's SpaceFitters Inc., were there. Job fairs, industry conferences and chambers of commerce are meccas for recruitment by small companies. They are places where individuals affiliated with smaller companies network and where they can ask the all-important, “Who do you know?”
Also among the roughly 50 firms at last fall's New Haven job fair were recruitment firms, such as representatives from Adecco, which has an office in Hamden. Tirinzonie says that recruitment firms come as paying exhibitors. “They're coming to hire, and oftentimes they represent large companies,” he explains.
Formed in 1996 and headquartered in Switzerland with offices in 58 countries, the Adecco Group estimates that the entire recruitment industry generated $400 billion annually in revenues worldwide in 2000. Of that, temporary staffing generated revenues of $140 billion in the U.S., while search/placement activities generated revenues of $30 billion in this country.
About half of Adecco's business comes from agreements with large national and international firms, company officials say.
As the economy contracts, search firms themselves are expected to feel their share of the pain. “Right now, the economy isn't healthy enough to support them,” Andex's Anderson says. Even recruitment giant Adecco's North American operations posted a revenue decline of 16 percent in the third quarter of last year.
At times, members of the recruitment industry fall victim to their own past successes. For instance, the New Haven office of Dunhill International no longer recruits for Barilla-America Inc. “They got too big for us,” general manager Kaiser says.
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