Recruiting Placement Fee Business Model Conflict

Using a commission placement fee business model, recruiting agencies are not heavily invested in the success of the company they are placing talent for.  And why should they?  They make a commission for placement, plain and simple.

Do IT recruiters know that the scope of skills the employer is requesting is beyond what a developer can humanly possess?  Does the employer?   While recruiters perform due diligence and expend tremendous energy trying to find the best candidate, due to the commission based business model, there is little incentive for them to inform the employer (if they know) that the scope of expertise requested is far too wide.

Consider this:  The candidate wants the job.  Will they exaggerate their competencies to get it?  Of course.  Yet the candidate will be expected to work using technologies they exaggerated their competency in.  Everyone knows the end result will not be good.

In many cases, employers themselves do not have the skills to assess a candidate’s skill level for specific technologies (that’s why they are hiring the candidate).  This is a classic catch 22.  “We need people with XYZ technology expertise, but we cannot determine the depth of the XYZ expertise the person has.”

When an employer expects scope of experience that is too broad, recruiters should suggest that the employer validate and rank the competencies of the candidate short list using a 3rd party agency.  OR, the recruiter should provide this service using a contracted 3rd party.

After all, it’s in the best in interests of everyone.  Hires will not struggle with technologies they are weak in.  Project timelines will not be multiplied due to exaggerated or weak competency levels.  Project risk is reduced.  And the employer will be extremely satisfied with the recruiter.

A KPMG formal study showed that 70% of corporations do not employ the competency level of skills required for a project.  Think about it.  A whopping 70% of IT projects are being worked on with people who do not have the level of skills required.  Kind of like having a plumber fix the roof.  The industry needs to fix this and recruiters are on the front line and in a position to help.

Here’s my summary:

Many employers expect too wide of scope of expertise because they do not understand the difference between the technologies involved.  As a development professional spanning over 2 decades, I have long concluded the same findings as the KPMG study.  NOT Competent = Incompetent.  Even if the scope seems small,  if the technologies involved span physical layers (such as .NET 3.5/4.0, MS SQL, WCF, CSS, Telerik, jQuery) and the same developer codes all layers, dumb things will be done.  Read this article where 95% of candidates produced nothing when a specific skill was assessed.  And that was AFTER the 50+ candidates were trimmed down to a short-list.

I have seen it time and time again: when developers work with technologies they are weak in, they take 3 to 5 times longer than expected and will inevitably get stuck.  In many cases, working in unfamiliar territory is dangerous to a project.  The industry needs to address over-expectations and recruiters are on the front line and in a position to help.  But the existing recruiting placement fee business model is antagonizing to the process.

That’s my opinion.  Are you are recruiter willing to explore a different business model?  Any suggestions?  Feel free to comment.


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