There is no such thing as a labor shortage. There are more excellent people out there right now than you can possibly hire, and you can have them—if you do things right!
Last week, I discussed what to let go in order to grow your business in the midst of a labor shortage. This week, as promised, I discuss what to take on. Below are my top four.
1. Referrals from your employees, and ask for them assertively!
The CEO of an American technology company was struggling to recruit for a mid-manager position. A Tokyo-based talent search company finally found a great candidate, who accepted the company’s offer of employment. On his first day of work, the CEO noticed many of the other managers on the floor greeting their new colleague with familiarity and congratulating him for coming on board, some even high-fiving him. Many of the managers knew the guy from previous roles in the industry! In the meantime, the CEO was stuck paying a commission to a search firm for successfully introducing a candidate many of his own company’s staff already knew! That very day, the CEO insisted on everyone providing three names of people they knew who would be good employees for the company, whether they were currently looking for work or not.
This is yet another reason to be uncompromising in hiring and retaining the excellent and eschewing the mediocre. Excellent people tend to associate with other excellent people, and if a trusted friend says there are opportunities at his or her company, and it is a great place to work, that will hold a lot of sway. However, I advise you to never incentivize an employee to provide referrals—whether financially or otherwise. You always want there to be no question in the referee’s mind that the referral was made because of a belief in mutual best interest and a desire to do good by a friend and worthy employer rather than only because of a reward of some type. Referral compensation diminishes trust.
When was the last time you asked for referrals from your employees?
2. Consult a recruiting firm if you absolutely must, but you personally deal only with its CEO.
If you are going to use a recruiting firm, you contact the firm’s CEO yourself to ask for help. Do not leave it to HR to contact the firm and get assigned whatever account manager is available.
Years ago, when I was a student in Japan, there were two jobs you could immediately get as a foreigner that required no experience or even Japanese language ability—English teacher and recruiter. I don’t think much has changed. I am sure there are excellent people working in that industry, but in my experience, they are the exception rather than the rule.
One of my CEO clients who was trying to hire a sales director had asked six top Tokyo-based firms for help, all of which turned him down because he insisted on hiring a woman for the job without compromising capability standards. He ultimately found his candidate without the help of any recruiters. As for the recruiters, they walked away from money left on the table simply because the ask was challenging, though not impossible.
My CEO clients often complain that they feel they are being given short shrift when engaging recruiting firms, and the track record of success when using them is low. The CEOs of recruiting firms tend to be capable business people, and are approachable. Ask the CEO for help and he or she will likely make sure that the best account manager is assigned to your company. Maintain contact with the CEO to follow up, even if your HR director is managing the work of the account manager directly.
Whenever asked, I always introduce a CEO client to the CEO of a recruiting firm to help. It is not unusual to meet a recruiting firm CEO if you are active in business events in Tokyo. They tend to attend them, and you will encounter them. However, you don’t need to have met a recruiting firm CEO in order to contact one. If you are the CEO of a company, just call the recruiting firm and ask for the CEO. You will likely get a secretary, but leave a message. I have never known a CEO of a recruiting firm to not return the call of a company CEO who might be looking for help.
3. Standards without compromise for the sake of expediency.
As I discussed in the previous piece, Labor Shortage and Letting Go, the best way to repel excellent people from your firm is to tolerate the mediocre in your midst. Excellent people always want to work with other excellent people and eschew firms rampant with the mediocre.Compromising your standards not only impacts your business’s performance, but also diminishes your ability to recruit better people in the future. It is a vicious downward spiral. Don’t let it take hold. Click To Tweet
Remember the CEO I mentioned above who insisted upon hiring a woman as a sales director without compromising standards? It took longer and he was successful, but most people around him advised that if he wanted to hire a woman, he would have to compromise his standards—and he could have, without any criticism. A number of female candidates were presented to him who would never have made the cut had they been male.
The CEO, however, was adamant. The woman he ultimately hired has turned out to be one of the most successful sales directors who has ever held the position, and if as an employer you want to attract the best and the brightest to your firm, nothing is more seductive than success, and certainly that company has a few problems attracting the best to its business. Sometimes it takes a bit longer, but this company has no problems attracting the people it needs because it is uncompromising about the people it wants.
4. Higher-value new business.
In my previous piece, Labor Shortage and Letting Go, I discussed letting go of higher labor-intense businesses, even if profitable, in favor of higher-value ones. That implies regularly forging new opportunities to create value—new technologies, products, customers, markets, selling processes, and delivery methods.
One company I mentioned in the previous piece is winding down a profitable yet labor-intense retail market business in favor for a higher-value and lower labor intensity business-to-business model, with which it has had remarkable success. A different company I know abandoned a non-strategic line of products that accounted for half its revenues to concentrate primarily on its highest-value products based on the company’s proprietary technology. Even though the company’s revenues dropped, the bottom line increased, and the company was able to transition the entire sales force to selling its highest-value, most competitive product.
Yet, taking on higher-value business is not just about generating more profit with the same or a smaller labor force. New business attracts new employees to your company, and not just any employee—the right kind of employee. Ambitious people with talent are drawn to growth opportunities, and there is no better personal growth opportunity than joining a team in charge of a fresh business—growing it and growing with it. A regular churn of the businesses your company works with attracts the best employees consistently and keeps them interested in staying with your company.
There is no such thing as a labor shortage…
…at least not for companies who attract the best. There are far more excellent people than you can possibly employ. Take on what is right and let go of what does not serve you, and you can attract the best—even in Japan.