Recruitment specialist Austin Cooke on how a high employee turnover can teach companies valuable lessons. Austin Cooke is the recruiting head of Sapient, one of the top technology consulting firms worldwide. In the past 10 years, he's helped Sapient grow from 85 people to over 2,300 people in 14 offices across the world and is one of the best-heard and respected voices in recruiting. His decade-long experience at Sapient aside, Cooke is also on the advisory boards of the Human Capital Institute and monster.com
A frequent visitor to India since Sapient set up office here in 2000, Cooke's experience in helping hire people for the local office as well as having survived the IT boom and bust cycle of the past few years has helped him understand the need to win the war for talent.
Recruitment and employee retention are particularly sensitive subjects in the Indian IT industry. From a little over 6 per cent in 2002, attrition levels are now at over 17 per cent. In the last financial year, the top five IT companies lost over 8,000 people.
And this when the scope of jobs outsourced to India has expanded from mundane, tech chores to high-tech complex projects. The need for the right people has never been greater "" or more vital.
Here, in conversation with Meenakshi Radhakrishnan-Swami, Cooke discusses the evolution of recruitment as a profession and the road ahead.
In the late 1980s in the US, HR and recruitment were considered the same. HR professionals were generalists who wore different hats at different times of the day "" recruitment, benefits, compensation...
But as the war for talent kicked in and escalated, people started recognising the need to break the mould. They appreciated the need for experts: You won't find talent by running ads in the paper. There is a need for strategy, for offering an unbeatable value proposition.
That is when recruitment suddenly became a prestigious career. It was given all kinds of fancy names: talent acquisition, search consultancy...
I believe India will go through the exact same phase. When I first came here in 2001, most recruiters were one or two years out of school, basically paper pushers. Recruitment was considered a junior profession.
But now companies are realising that their future depends on getting the right kind of people. Now there are more senior people involved in the job and it's taken far more seriously.
Of course, the basic issue "" whether here in India, or in the US "" remains the same. How do you win the war for talent? It's easier said than done.
What is required first is a change in mindset. The culture of the company has to become more of recruiting, more of offering the right value proposition.
Of course, it's difficult. I wish I had a nickel for everytime someone said to me: "There are a billion people in India. How hard can it be to recruit there?"
If I look back at the bubble phase in the US, things were crazy. I remember in 1999 we handed out three BMWs to people who had referred five people each.
That was insane. We had MIT graduates who said they wanted to be millionaires in three years, and we were listening to them!
Companies were offering huge sign-on bonuses. One company offered new recruits a hot-air balloon ride from the roof of the company building.
When a large database company found out that another large database company was in trouble, its recruitment team hired a trailer, took it to the troubled company's parking lot and conducted interviews right there. A team of 30 people put themselves on bid at e-Bay.
I don't know if this is true, but we heard of a man in California who was offered $100,000 to work as a stay-at-home programmer. He hired someone in India to do the work for $10,000 "" and got $90,000 to play golf!
By 1999-2000, if you stayed at your job for two years, people wondered what was wrong with you. We had lost touch with reality. In fact, 2000 was an amazing year in the US. There was energy, passion, the future looked brighter than the past. India is in the same phase now.
Does that mean there's a bust round the corner as well? Well, hopefully not. The good news is that a lot of people have been through it.
At Sapient, for instance, our leadership is still the same as it was during the boom and bust days. But they've been educated. It's like they have an MBA in bubble. Other companies went through the same problems. And we're all more careful now.
Besides, the nature of jobs being sent to India is changing. Now the focus is more on high-skilled jobs. No one really pays attention to the mundane, tech chores "" you can hire juniors by the busload. But high-skilled, complex jobs are different "" they require more effort on the part of the hiring team.
So it's necessary that recruiters get more skilled in identifying these people, discovering what their value proposition is and then putting them through a great interview process.
But remember, there's no such thing as one value proposition. It's not plug and play. You need to have a broad value proposition that appeals to more and more people.
The interview process is particularly important. At Sapient, we call it the Disney effect: make the candidate feel they've come somewhere special, where they've never been before.
Even if we hire only one out of 10 people we interview, we want those nine candidates to go back and tell others what a great process they went through "" and we want them to reapply the next year.
And don't treat the interview and recruitment process lightly. Make it tough for people to get jobs in your company: the really good people want to be challenged. They want to be sure the company they're applying to knows its stuff.
That's why it's important to use your A people. A people attract A people; B people attract C people. And if you have too many C people, you'll die.
We judge potential employees on three scales: their cultural skills, domain skills and their course skills. Course and domain skills can be learnt "" we keep tabs on everyone who doesn't make it from either of these points of view. Because these are skills that can be taught.
At Sapient cultural fit is the most important. The cultural fit is determined at the first interview itself "" if we feel a person won't fit in, we terminate the process right there.
A lot of companies think like that. But there are just as many companies that only want bodies "" they'll hire anybody with a heartbeat. These are companies that are not really looking to building a great organisation.
A non-cultural fit can do huge damage. It can cause so much pain, especially in a company like ours, which is so team-oriented. One bad egg can disturb the entire team and make it non-productive.
And when you consider that a number of our clients are Fortune 500 companies and we do million-dollar projects for them, the dollar cost of the damage from employing the wrong person can be enormous.
Companies feel pain by not having a lot of the right people. When that happens, they focus on recruitment. That's why I encourage attrition. It will make companies focus more on the value proposition.
They'll spend more time finding ways to retain their employees. You get to that point only when you feel pain. Perhaps some companies deserve that pain because in the past they haven't treated their employees as well as they should have.
After all, a great career is when both the company and the individual gain equally. When the company is doing well and the employee thinks that he is prospering, that's when he's likely to stay "" and that's a great career.
But why should someone want to stay on in a company? It's important to remember that as people mature, money stops being so important. People are more likely to ask themselves, did I grow? Did I learn anything? After all, at the end of the day, a small increase in salary won't change your life. And more and more employees are now going in for soul searching: am I going to a job or am I building a career?
If you're after a career, remember that it doesn't pay to keep switching jobs. Resumes don't lie. If you have a track record of leaving a job every year, that's not a good sign for a prospective employer "" your past behaviour is a predictor of future behaviour. And companies are getting smarter about who and how they're hiring. So it's important to pick your company wisely.
Also, if you change jobs every year, you'll do so for marginal changes in pay and responsibility. But if you stay long enough in a company that invests in you, you can make a career change that is significant.
