As an entrepreneur, you know how important it is to build your sales pipelines. The question, though, is how much effort have you put into building your talent pipeline?
Brendan McGurgan argues that sustained business success depends on creatively engaging with talent who are about to enter the workforce or who are working elsewhere. McGurgan is the director and founder of Simple Scaling, former group managing director of CDE Group, and author of Simple Scaling. While with CDE Group, McGurgan helped the company deliver almost $750 million cumulative revenue and $75 million cumulative profit from more than 90 countries.
When McGurgan first dug into CDE Group’s recruitment approach, he found a reactive process being managed by a team that was already overstretched, something common to many fast-growing companies. He set about to change the way CDE Group recruited, and shares the approach he used during his 12 years in the role to transform the company into a large exporting business employing almost 700 people and achieving 25x revenue growth.
Recruitment is not a function of HR
When McGurgan was hired in 2007, CDE Group was a rapidly growing engineering company with a big problem: attracting great talent. Line managers couldn’t keep up as CDE Group grew because they didn’t have the capacity to deliver an ever-increasing workload.
McGurgan wanted to find the root of the problem: “If you are failing to attract great talent, it’s nearly always down to one of three things,” McGurgan explained. “Your culture is wrong, your recruitment processes aren’t working or your employer value proposition (EVP) is not impactful.”
McGurgan knew it wasn’t the culture, as that piece is what drew him to the company in the first place. When he began exploring their recruitment processes, McGurgan found a misallocation of responsibility that is common in small and medium enterprises (SMEs).
“Typically, recruitment falls within the remit of HR, which tries to fit it in as a sort of secondary function,” McGurgan said. “This is a big mistake, but one that has a simple solution.”
Consider a full time recruiter
Recruitment is one of the most important functions in a scaling business, McGurgan explains, so you need to get it right. The greatest gift you can give an HR team that is stretched too thin is a full-time, dedicated recruiter. If you can’t afford this role right now, there’s another option.
“You can engage with a local recruiter in what’s called an RPO, or recruitment process outsourcing arrangement,” McGurgan said. “The agency employs the resource, but they are based in your business. It’s a service many of the larger recruitment agencies offer.”
Once you have your recruiter, you can set about creating a resource plan for the future. There’s no magic formula for figuring out how many people you should take on. The important thing is to be realistic about how long it will take to both find the right person and to develop them into a valuable contributor. Remember also that the repercussions of hiring too many people or hiring the wrong people can be harmful to everyone involved.
“When you are trying to peer into the future to establish your needs, factor in things like upcoming projects,” McGurgan advised. “You can also look at your plans for expansion into new sectors and new regions, as well as predicted changes in those sectors.”
Another tip McGurgan offered is if you’re beginning to achieve high growth and profitability, consider a revenue-per-employee or profit-per-employee target. There will be a sweet spot for this metric. Too many people and it becomes too low. Too few and you risk team burnout.
Think differently about hiring
Beyond how many people you should hire, work with your recruiter to determine how you’ll find the people you need. Challenge your assumptions here. Do new hires really need previous experience? Can you retrain people? Can you recruit fresh from universities and colleges?
“As my team and I went through this process, I realized there were an estimated 2,000 unfilled technology roles in Northern Ireland alone,” McGurgan said. “And yet, despite this shortage, it was unheard of to appoint a software engineer without at least a software degree.”
So McGurgan sent out a blanket email to all of the colleges of further education in the area, asking them about their Higher National Diploma qualifications and apprenticeships. This kickstarted what turned out to be a new relationship with what is now Northern Regional College in Newtownabbey, one that benefited both their objectives and those of CDE Group.
Northern Regional College wanted to establish stronger links with industry, while McGurgan wanted to widen his company’s talent pool. Together, they identified the cohort of students most likely to fit CDE Group’s needs and created an online psychometric test, which they offered to all 60 course participants. The highest scorers were invited to a daylong interview and assessment, after which the top five were offered work placements.
“For the next five consecutive years, we had 100 percent employability from that internship program,” McGurgan revealed. “Every candidate was polished, impressive and eager.”
How can you build a strong talent pipeline?
With clear goals and a bit of creativity, McGurgan and CDE Group were able to partner with the education sector to develop something more systematic that added significant value to their talent magnetism. The problems McGurgan once saw have subsided significantly.
“Talent pools are shrinking and skillsets are changing, so you can’t be afraid to get creative and experiment, he said. “But first, you must be crystal clear about what you’re looking for.”
While it may not be an educational partnership, ask yourself how you can begin to think differently about recruiting. To start, make sure HR isn’t being burdened with recruitment. If they are, hire an in-house recruiter or find an RPO in your area who can provide you with one. Just that one step alone will go a long way toward replenishing your talent pipeline.