Why the recruitment industry needs to evolve

Why the recruitment industry needs to evolve

Most recruitment firms are placing the employer at the centre and continuing to commoditise talent, at a time when the right people are in short supply.

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How is the tech recruitment landscape changing in Singapore and the APAC region, and should traditional recruiters adapt to be more relevant and effective? 

In the age of digitisation, do they need different methods or a new radical approach to find the right talent? Paul Endacott, CEO & Founder of Singapore-based recruitment firm GRIT shares his perspective and thoughts with iTNews Asia.

iTNews Asia: You’ve described traditional recruitment as stagnant, slow to adopt technology, and cost inefficient. What is the state of the recruitment industry and do you think traditional recruiting methods are failing?

I don’t believe traditional recruitment methods are failing, rather they have not really transformed or evolved over the last several decades. The recruitment industry, albeit being a US$100 billion industry in APAC, has been stagnant, relying on traditional models to inefficiently generate applicants and match them with companies.

There has been a slow adoption of technology to automate many of the processes that do not require human intervention. There have been innovations that support recruitment efforts, such as job boards, LinkedIn and more efficient CRM’s, but, by and large, traditional recruitment processes have not really evolved.

The ‘war for talent’ has been spoken about for years, yet most recruitment firms still place the employer at the centre and continue to commoditise talent. The reality is that talents should be at the centre of any recruitment strategy.

Past research from Deloitte has shown that 83 percent of job seekers have had a poor candidate experience. This has potential repercussions for the employer, in the ongoing war for talent, as a poor applicant experience can change a suitable talent’s mind about a role or company they once liked. It’s crucial that designing the candidate experience is not only human-centred but aligned to what they expect in their daily lives.

iTNews Asia: How has digitisation changed the recruitment process? Do we still need face-to-face?

The pandemic has forced employers to hire and on-board talents virtually. It has also proven to those who were cynical of this process that is indeed possible, can be effective and is often more efficient.

I don’t believe that companies will now fall back to having to meet talent face to face in person, in fact I think the default will become virtual for large parts of the process. There is a comfort factor in meeting in person when it comes to a final decision or assessing culture fit, but we have already seen digitisation occur in all parts of the process and this is unlikely to change.

From my observation, international talent search is still an active strategy employed by many companies for a variety of reasons. For instance, companies may choose to look at talents overseas to mitigate the tight labour conditions in the local market.

Companies may engage in offshore hiring to access cheaper headcount, a larger pool of skilled talent, or as part of global expansion plans. Technically, you can offshore any position that does not require face-to-face interaction with colleagues or clients. This process has considerably less friction due to companies and talents investing in and embracing new digitalisation work processes as well as WFH arrangements.

Some companies may even approach talent search from a business continuity perspective and prefer to have their talents scattered across the globe in order to mitigate any business risks. 

iTNews Asia: Can you share more about the intensifying tech talent crunch in Asia. Which are the hardest tech talents to find now?

Data from a recent Southeast Asia Tech Talent Compensation Report by Monk Hill Ventures show that there’s a talent crunch occurring regionally. Technical roles, such as product manager, data scientist/analyst, and engineers are still the most in-demand and highly remunerated across the region, so much so that strong candidates can name their price and have strong bargaining power.

Particularly in Singapore, engineers and product managers are in high-demand largely driven up by Big Tech companies, both from the USA and China, setting up their APAC/SEA HQ here in Singapore.

The challenge of a shortage of supply isn’t going to be resolved overnight. As innovation continues to be fuelled by startups, scaleups and traditional companies pivoting towards online, this is set to continue. Furthermore, recruitment is generally a confidence-driven business. With vaccine rollouts, and companies adapting to doing business through technology, hiring is back on the agenda again and demand for talent is increasing. 

iTNews Asia: Are smaller organisations at a disadvantage? How can a social and community eco-system for digital and tech talents help local Asian companies with their recruitment?

Smaller organisations such as startups are often at a disadvantage because of their hiring budget but they often try to make up for this with employee stock ownership plans (ESOP). Generally, talents are not as interested in these because successful exits in SEA have been limited compared to Silicon Valley and many employees have yet to realise their options.

That said, with the recent successful IPOs of Southeast Asian companies such as Sea or even the pending IPO of Grab and the GoTo merger, talents are beginning to believe in the value shares can create.

However, the caveat is that the companies must have a clear vision and be able to articulate to potential and existing employees that they have a strong chance and plan for the route to success. 

Alternatively, I also see startups putting effort to build a work culture that aligns with their employee’s values.

Salary compensation aside, tech talents are also drawn to other factors such as a progressive career path, flat hierarchy, technical freedom, being able to use the latest technology and a strong product. This has helped startups attract talented employees who are looking for a change from Big Tech or large organisations. 

Paul Endacott, CEO & Founder of GRIT

All of these can be articulated to an online community of digital and tech talents which will inevitably help with employer branding and facilitate the recruitment process for the right candidates. This could also be explicitly articulated by the organisation itself or by past and current employees who may share their experience working at that said organisation.

The reduction of information asymmetry between organisations and prospective talents will benefit both parties. Just think of how Linkedin or Glassdoor has helped the hiring and recruitment ecosystem at large but this would bring specific value to tech talents. 

iTNews Asia: With remote working becoming common, will it be easier to find people across borders, and has it opened new ways to find talent?

The technology sector in SEA has developed at such a breakneck speed in the past decade and shows no signs of slowing down. However, the acceleration of the regional’s digital economy is hampered by the development of relevant skill sets in the workforce which have not quite kept pace.

The tech talent shortage is particularly pronounced in Singapore. Companies and governments will invest more in training and development leading to an increase in L&D to upskill talent in the short, medium and long-term. For instance, the Singapore government is deliberately widening the local tech talent pipeline with initiatives such as TechSkills Accelerator (TeSA) and Professional Conversion Programmes (PCP). 

Companies have also taken great initiatives in filling the talent void. For instance, Sea Group had partnered with the National University of Singapore to launch a unique degree programme, Bachelor of Technology in Computing Work-Study degree, where students are hired as full-time Junior Analysts prior to the start of the programme.

The Nanyang Technological University in Singapore has partnered with Facebook to train local engineering undergraduates and postgraduates for specialised positions in data centres. Companies such as Razer and DXC Technology have also embarked on training and orientation initiatives. 

However, due to the scale of the tech talent shortage, it is expected that these efforts are still likely insufficient to meet demand. As such, we are seeing companies exploring distributed talent teams as mentioned earlier, by leveraging on WFH investments to scale up their teams geographically.

If organisations embrace this, by implementing the right infrastructure that allows companies to engage and manage evolving teams, then this will help companies with the talent gap as they are no longer restricted to local talent pools.

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© iTnews Asia
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