The oil and gas industry may have had its fingers burnt by unsustainable recruitment practices in the past. But as Matt Halle from Singular explains, a window of opportunity is opening to embed innovative practices and technologies into the recruitment function, secure the best possible people for your brand, and avoid repeating the problems of the past.
The business environment remains incredibly tough, but the oil and gas sector is showing signs of cautious optimism. Nonetheless, the need for cost discipline remains, and the industry needs to retain its new mantra of doing more with less.
What’s more, individual businesses need to embrace continual innovation to remain ahead of the competition. That applies as much to business processes as it does to technology development, particularly when it comes to recruitment where the challenges of an industry uptick are about to generate the same talent shortage challenges that the downturn has only exacerbated.
Talent management in a downturn focuses on organisational design, remuneration models, training, culture and maintaining morale. But even before the downturn, recruiters faced serious difficulties.
The imbalance between the supply and demand for talent had become pronounced – mainly due to the ‘demographic timebomb’ – driving up wages and hiring costs. Recruitment became reactive, serviced by myriad agencies responding to project awards or replacing staff where no adequate internal succession options existed.
For the sake of urgency, many companies compromised on quality or cost – and sometimes both. Maintaining strategic and operational control of the process was incredibly difficult.
Because demand for their skills was so high, the negotiating power of the so-called ‘contingent’ labour market rose, meaning they grew less responsive to new opportunities. Higher remuneration came without the corresponding downside of ‘mutual non-obligation’.
In this environment, in-house recruitment teams were largely driven by cost reduction. Arguably, they struggled to improve quality, reliability or flexibility, and certainly struggled with the spikes in demand outside of business as usual recruitment that this industry is known for.
Many of those internal recruitment teams have now been disbanded, but the underlying problem persists. The nature of this downturn has seen vast numbers of good people laid off. Having found secure employment in the interim, a considerable number have left the industry for good with no intention of returning.
Graduate employment rates dropped dramatically over the past three years, while the intake to petro-technical degree subjects also decreased. The ever-stronger pull for engineering graduates from ‘sexier’ industries has not helped.
However, the emergent recovery presents new opportunities for recruitment professionals to re-engineer hiring practices – and avoid returning to the panic-driven models of the past. This is something every leader should be thinking about. It is the ideal time for organisations to start building a hiring framework that allows them get smart and scalable.
Everything is under the microscope: from employer branding and compensation modelling, to manpower planning, sourcing, and talent pipelining. In particular, succession planning – including a more proactive and ongoing relationship with the external labour market – is needed to prevent backsliding into frothy hiring markets and over-the-top spending. Even assessment, selection and on-boarding processes present opportunities to do something different.
One area to look at it is new technologies, which are playing a much more significant role in the recruitment process. Project management, employer branding, candidate sourcing, applicant tracking, agency and contractor management are all areas where innovative technology can drive efficiency into the process.
But even technology adoption has become much more strategic, certainly in comparison with earlier, more responsive approaches – when too many organisations failed to take an enterprise-wide view.
Technology holds as much importance to the recruitment function as it does to any other part of a modern business. And as with any other enterprise platform or mission-critical system, it is essential that organisations assess the multitude of service offerings on the market, perform due diligence, and select the most appropriate option.
But it is also important to view technology as an enabler. Firms that rely on IT for all the heavy lifting will soon discover the limitations of doing so: especially when human interaction and personal relationships still play such a crucial role.
This is particularly true in the passive candidate markets that are driven by professional, research-driven, well-informed and personal interactions. The right blend of soft skills and software is critical.
So, how else do firms go about achieving an innovative and strategic approach? Firstly, take the old advice and ‘know thyself’. What are the organisation’s specific needs – and how do these vary in differing but plausible scenarios? What is the essence of its employment brand and reputation? What are the likely sources of talent from inside and outside the industry? Have competitors demonstrated an ability to consistently secure and retain superior skills in the past? If so, why?
Armed with the answers to these questions, the organisation can work up a forward-looking manpower plan and risk assessment and develop an attractive proposition for potential hires.
From there it can start communicating with the market before it needs to actually make appointments, ‘warm’ the talent pool, and start exploratory meetings with key, strategically necessary individuals.
This is what any strong recruitment function should be doing right now. But where hiring functions have been mothballed, or in-house professionals replaced by agencies, it’s time to look at outsourced relationships again.
In fact, it’s probably time to mothball the word ‘outsource’ – with its implication of a strictly transactional customer-supplier relationship. Strategic hiring starts with developing engagement models for recruitment process outsourcing (RPO) that are based on partnership, trust and transparency.
Even when operating at the volume end of the market, there is significantly more to be gained from using RPO providers than applicant tracking systems and candidate sourcing methodologies – essential though these are.
It’s about building sustainable recruitment functions that can scale from 100 to 1,000 or even 10,000 hires without any loss of quality or rigour, retain the IP rights of its new processes and systems, take back control of endless preferred supplier lists and build relationships with essential suppliers.
Team of rivals
It’s also time to look again at the relationship between process-driven contingent recruitment and high-touch, customised executive search. Naturally viewed as two entirely separate functions performed independently from one another, it is probably more helpful to view them as opposite ends of a recruitment spectrum, allowing a fast-paced, tech-driven RPO function that complements research-driven executive search.
Both functions can enrich each other’s work with shared insights, creating the ‘big picture’ recruitment function that can respond to changing requirements. For that to work it needs suppliers who can work together in a harmonious relationship that isn’t beset by professional rivalries, secrecy and leak prevention.
Seize the day
Fixing recruitment is no small task. But once the industry starts hiring again, it will be too late to put the necessary groundwork in. Firms that don’t maximise the current window of opportunity will find that old hiring habits come back – accompanied by familiar headaches and inexplicable invoices.
Ensuring the correct models are selected and implemented ahead of time will ensure flexibility, efficiency, and competitive advantage. The industry has the chance to get it right this time by being innovative and proactive – as long as it starts thinking about it now.
To find out more about Singular, visit their website: http://singularrs.com/