In the mid-1800’s Charles Darwin suggested that evolution works on the concept of survival of the fittest – noting that individuals in a population, or community, are more likely to survive if they adapt into their environmental conditions.
And in the world of talent acquisition, change is constant – and forward-thinking companies have embraced that change to remain fit.
Over the last two decades the rate at which both companies and individuals have changed has been faster and more radical than ever before – spurred on by technology innovation, AI, automation, a model of Agile Delivery, and the requirement for a better work-life balance.
However, what hasn’t changed for decades (for most companies) is staffing strategies, headcount allocation, resource plans and the notion that scaling a business translates to increasing permanent headcount.
And therein lies the problem: The talent-ecosystem has changed radically but most companies’ talent attraction and staff retention practices have not.
Ironic really, given that all senior execs will tell you that ‘their people’ are their most valued asset; however, their acquisition, care and management of that (most valued) asset remains unchanged and has done for decades.
Take recruitment as a case in hand:
A company has job vacancies which need to be filled, urgently, so what do they do? Well, the majority continue doing what they’ve always done, (yielding next to no results), without questioning the logic (or lack thereof) around those events and recruitment processes:
- They post job adverts on advertising boards, LinkedIn, social media platforms, and their company website; in the knowing that above-the-line advertising in today’s candidate-market no longer works.
- They hire expensive Talent Acquisition Teams to process the vast, irrelevant responses to those job adverts, whilst knowing that 90%+ of those advert respondents are going to be irrelevant to their jobs.
- They pay an exorbitant license fee for LinkedIn Recruiter (and its “job slots”), spending days and days trying to find needles in haystacks; whilst knowing that LinkedIn is an over-populated, un-curated database which has fast-become a social media platform rather than a business-introductory enabler.
- They fight for candidates in the ‘Intermediate level experience’ of the market, believing that these people will hit the ground running (to a degree) and that their salaries will be affordable; whilst knowing that competing for talent in that ‘intermediate level’ segment means being left with little ammunition, apart from competing on price (salary) with the consequential escalating payroll costs.
- They believe that hiring permanent employees will bring stability to retention churn; whilst knowing that the average tenure of a permanent employees in the tech market is 1.5 years.
- They continue to hire permanent employees, believing that their headcount will scale, whilst knowing that attrition rates (in the tech market) is breaching 20% year on year.
- They aspire to a fast and agile client delivery model; whilst knowing that the average time it takes to fill a skilled permanent vacancy is 50 days.
- They bemoan the global talent shortage; whilst failing to recognise that abundant talent pools exist, but that talent is choosing to work in a more progressive way.
Adapt or die:
Talented people have embraced a different way of working and companies need to adapt to the change.
Take employment as a case in hand:
- Market recessions and a pandemic resulted in mass retrenchments and the great resignation; making people feel insecure in permanent employment.
- Companies proclaiming a ‘family culture’ are quick to cut permanent staff when times are tough and/or their investors demand a scaling back.
- 9-5 employment has caused societal dysfunction – exhaustion, depression, excessive consumption, obesity, divorce, children with behavioural anxiety, environmental damage, climate change, energy wastage and an ever-growing wealth divide.
- One in seven people experience a bout of clinical depression during their working lives.
- Diversity and inclusion remain allusive to companies – unconscious biases remain in the current recruitment model, and companies retain their fiefdom culture-fit policies.
- The gap between employee and employer expectations is wider now than it’s ever been before – work-life balance is a concept rather than a reality for most.
The ecosystem has changed:
- Skilled people are taking back power, and what that means is ‘choice’ over where they work, when they work, what they charge, and which companies they’d like to work for.
- Skilled people are choosing to engage on project-based work, without the confines of restrictive employment contracts that dictate the way in which they work best.
- People are fatigued and fed up with the mundane – the repetitive work-cycles, unrealistic company promises and towing of the company line.
- People have embraced flexibility – and that has resulted in a move to a model of independent contracting as a way of life, and a life of self-control.
Forward-thinking companies have embraced this new normal and the upside for them is enormous:
Take talent acquisition as a case in-hand:
- The world’s most successful companies have changed their permanent employee vs. independent contractor headcount balance, recognising that talent has chosen a different model already. The result being that their staff compliment is complete.
- Curated databases of skilled Independent Contractors serve this demand – the market-leader example being an innovative SaaS platform called One Degree.
- Platforms like One Degree offer a rich pool of talent where companies can find exactly who they want, when they want, at the rate they want; matching companies and individuals perfectly, efficiently and cost-effectively.
- The algorithmic search technology on One Degree delivers accurately on skills, rate, availability and location.
- One Degree makes everyone 1st Degree connections, thereby enabling rapid communication between both parties, instantly and direct, eliminating the reliance on third-party recruitment agencies and their associated transactional recruitment fees.
- One Degree’s subscription-based model means that companies can hire as many people as they need, for an affordable fixed and transparent cost.
- Skilled tech talent is engaged quickly and as needed for project-based work, supporting Agile delivery around client-expectation timescales.
- Companies can shape-shift by scaling headcount up and down as needed, without the cost of severance packages and/or the reputational damage which results.
- Contractors deliver quicker, without the need for onboarding and induction – meaning reduced payroll costs and cost saving, whilst enhancing the quality and productivity expected of the best.
By 2026 it is estimated that Independent Contractors will fulfil 50% of all companies staffing requirements.
Companies who adapt to this new staffing model will win the war for talent and avoid the retention revolution – they will grow stronger by attracting the best. They will again prove and reinforce Darwin’s 1800’s observation that survival of the fittest demands an adaptation to the environment.