I recently saw a “pin” on Pinterest about everyday ways to save money. The list included things like hang your laundry to dry, use coupons, re-evaluate your car insurance, try DIY projects, make your coffee at home each morning and bike and walk more and drive less. The article got me thinking about ways recruiting firms can reduce their costs. I did an Internet search about ways to reduce or save on recruiting costs and came across a post by SilkRoad. I’ve included a few tips below that are both practical and relatively easy to implement.

• Improve retention – You don’t have to spend money hiring new people if your existing good employees stick around. Study retention, track it, and continuously work to improve it.
• Stay on top of new sourcing technology – Let’s face it, sourcing is your mainstay. A continual investment and investigation of the latest tools and techniques will pay off.
• Use social recruiting – Twitter, Facebook and LinkedIn are all free ways of building a brand and seeking candidates.
• Assess value, not cost – One of the biggest recruiting costs is hiring poor performers. Assess the quality of the hire and go the extra step of asking managers to put a dollar amount on the difference between top, average and poor performers.
• Join a global recruiting network – This tip wasn’t included on SilkRoad’s list but I think it’s a good one. Instead of hiring additional employees with no guarantee of performance, consider joining a global recruiting network. Recruiting networks, like NPA, allow you to make money without the overhead of managing and monitoring your employees. Plus, you only pay those who perform. Can’t beat that model!

See the remaining 6 tips to reduce recruiting costs at SilkRoad’s website. In what ways does your recruiting firm cut back on cost?

Recently, I’ve noticed during conversations with some recruiters with whom I speak about membership in our split placement network that they say they have made split placements. Further questions reveal they didn’t make the split placements the “traditional” way. Instead, they provided a candidate to an employer via an online service like BountyJobs.

I propose that the “recruiter community” language for split placements has changed. You can no longer assume that when recruiters state they have made split placements that it occurred the “traditional” way.  Specifically, what I mean by “traditional” way is when a recruiter with a job works directly with a recruiter with a candidate and the candidate is hired by the employer. This results in the two recruiters splitting the client fee.

“Traditional” split placements happen in one of the following ways:

       1. Informal Network

• Recruiters form their own, usually small, network of trusted trading partners. Most savvy recruiters will have signed split fee agreements even if they make splits with recruiters they have known for a long time.
• In addition, larger informal split networks exist online including in LinkedIn. It is not unusual for recruiters in these informal networks to have never met face-to-face. Again, savvy recruiters will have a signed split fee agreement before working with another recruiter they met online.
• If you are a recruiter considering making split placements with other recruiters or are currently making split placements and do not have an agreement signed with the other recruiter, check out our sample split fee agreement which can be used as a starting point to create your split agreement.

    2.  Formal Network

•  A recruiter pays to participate in a formal network. In NPA, The Worldwide Recruiting Network, members pay one-time enrollment fees, monthly dues, and brokerage payments when split placements occur.
•  Networks can have a general focus or specialize in an industry or niche. Some networks may include members located in only one country or state and others, like NPA, have members throughout the world.
• Formal networks must have rules of engagement so that trust can build among its members. If the formal network is not built on trust, an environment develops where split placements will not flourish. The rules of engagement will typically including the treatment of candidate referrals. Also, a formal network should address what happens if something in the split placement process does not go well. Of course, clear and written communication between the recruiters can minimize these situations. As a cooperative of independently-owned recruiting firms, NPA recruiters are bound to act within the Bylaws approved by our members.
• Signing the network’s membership agreement or contract binds its members to abide by its rules of engagement and may eliminate the need for a split fee agreement to be signed between trading partners. In NPA, a separate split fee agreement between trading partners is not necessary since the owners of the member firms signed the NPA Membership Agreement.

Many differences exist between informal and formal split networks as well as split job boards. It is important for recruiters who make split placements to understand the differences including the different definitions of a split placement?

What is your definition of a split placement?  Do you prefer “traditional” split placements or those made through split job boards?

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