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Winning the war for talent

Jason S. Warner limits himself to one cup of coffee a day ' admirable self-control, considering where he works and the rigours of his job. Warner, director of North American recruiting for the Starbucks Corporation, is contending with a hiring boom spurred by one of the most ambitious growth stories in retailing.

Starbucks, with more than 11,000 stores and roughly 120,000 employees worldwide, plans to open 1,800 stores this year. The long-term goal is 30,000 around the world, including 15,000 in the US alone.

By definition, opening thousands of stores means adding tens of thousands of employees. (Right now, the company is adding people at the rate of 200 a day.) Warner and his colleagues in the recruiting department are determined that these head-spinning numbers do not lead to the creation of a paint-by-numbers hiring bureaucracy or to a weaker frontline staff. There is a direct connection, he argues, between the identity of Starbucks in the marketplace and the distinctive character of its workplace.

So the company has devised all sorts of ways to add personal touches to the way it hires. Whenever possible, job interviews include coffee-tasting sessions, in which Starbucks veterans discuss the virtues of various blends with applicants. A “candidate bill of rights” emphasises that recruiters use phone calls, sets goals for how quickly applicants should hear back and encourages recruiters to send out Starbucks gift cards in nominal amounts as goodwill gestures, whether or not an applicant gets a job offer.

“Our aim is to treat our candidates as well as we treat our customers, to do something memorable for them,” Warner said. “You can’t treat people shabbily, especially in a world where there are far more open jobs than there is available talent to fill them. We strive to put the humanity back into the recruiting experience.”

Few companies seem to share that goal. To be sure, “people are our most important asset” is the most ubiquitous platitude in corporate life. But organisations that have spent years reinventing their supply chains and turbocharging their computer systems seem oddly content to keep hiring the old-fashioned way: by posting open positions in newspapers or on Internet job boards, hoping that enough candidates see them, and sorting through the r'sum's ' what Warner calls the “post and pray” school of recruiting.

“There's a new war for talent, but most companies aren't bothering to fight,” argues John J. Sullivan, a management professor at San Francisco State University and critic of traditional hiring practices. “Whether it’s a store manager or a software developer, there’s a huge gap between the business results that average employees deliver and what stars deliver. If you want to win the battle in the product market, first you have to win the battle in the talent market.”

This is not, Dr Sullivan is quick to add, a plea to return to the bad old days of the 90’s dot-com boom ' when the last “war for talent” became an excuse to lavish big signing bonuses on any self-absorbed M.B.A. or self-impressed Internet marketer. It is, instead, a call for companies to become as creative and aggressive about stocking up on talented rank-and-file employees as they are about designing sleek products or producing flashy television commercials.

“The first rule of recruiting is that the best people already have jobs they like,” Dr Sullivan said. “So you have to find them; they’re not going to find you. It’s amazing that so many companies still use job fairs to recruit talent. Who goes to job fairs' People without jobs! Recruiting has to be a clever, fast-moving business discipline, not a passive, paper-pushing bureaucracy.”

As an alternative to the passive approach, consider the hiring strategy pioneered by Quicken Loans, the mortgage company based in Michigan. This fast-growing company, with 3,400 employees, closed $16 billion worth of home loans in 2005, compared with $4.6 billion in 2001, and has emerged as the country’s largest Internet lender.

According to Michael G. Homula, Quicken’s director of talent acquisition, the company’s most pressing business challenge is to add employees quickly enough to keep pace with such meteoric growth without diluting its highly charged culture. Specifically, Homula is racing to hire 200 mortgage bankers a month for the foreseeable future.

“This is the job that really moves the needle at our company,” he says. “These are the people who interact with customers, solve their problems, make things happen. We ask ourselves every day, ‘Where is our next great mortgage banker going to come from'’”

The primary answer, it turns out, isn’t help-wanted ads, web site postings or job fairs. Homula and his 34-member department have mastered the art of discovering talented candidates in unlikely places.

This month, for example, they organised a “road rally” in which teams of recruiters blitzed a carefully selected group of shopping malls. They walked the aisles, bought merchandise, ordered meals and hunted for employees and managers who stood out by virtue of their energy, enthusiasm and rapport with customers.

“Too many companies focus on industry experience when they recruit,” Homula said. “We’re after certain kinds of people, not people from a certain business. We’ve turned waiters and waitresses into great mortgage bankers. We can teach people about finance. We can’t teach passion, urgency and a willingness to go the extra mile.”

It may sound like an exotic strategy, but it's not without a precedent. The free-spirited Southwest Airlines has made it a point to recruit flight attendants, gate agents and baggage handlers from the ranks of, say, schoolteachers and police officers rather than limiting itself to industry veterans.

Warner of Starbucks, who swaps recruiting ideas with Homula, says that all of this puts even more pressure on companies to create memorable experiences for the candidates they evaluate. “You’re not going to refer someone you know and like unless you’re certain they're going to be treated well,” he said. “But if you exceed everyone’s expectations, you create an incredible advantage in the talent market.”

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