What is sourcing strategy?

New Career OpportunitiesGreat article I read by Vince Szymczak, first posted on March 21, 2015

If you are effective and efficient in what you normally do, you naturally stick to it. To cope with the rapid changes in the business world you need to look a bit further ahead. There are situations and challenges when the norm is not sufficient – instead of finding out the hard way the wise prepare. This article is meant to give you a blueprint on how you can create a sourcing strategy when you anticipate a difficult challenge or know that for some reason you can not stick to your normal activities.

1. What is a sourcing strategy?

Let’s start answering the question what is a sourcing strategy with understanding what is, generally speaking, strategy? A question so simple, but one which has so many answers to. The evolution of management theory generated many definitions, like this from the person who probably holds the Guinness record for appearing in most university subjects, Michael Porter:

“[Strategy is the] broad formula for how a business is going to compete, what its goals should be, and what policies will be needed to carry out those goals”

A widely used definition by Oxford Dictionary states:

“A plan of action designed to achieve a long-term or overall aim.”

The key things to understand are that strategies

  • Describe your end-goal
  • Focus on how you are going to gain competitive advantage
  • Are long-term
  • Break down what is needed to reach the goal

 

2. Now that we know what a that strategy is, the question is what is sourcing?

The point of this article is certainly not to write an in-depth analysis of what should be considered sourcing and what is not sourcing (read about that here from Glen, here from Balázs, and here again from Glen). But since there are contradictory sourcing definitions, let me define it with a sentence how I typically introduce it to a layman.

Sourcing is the opening act of the recruitment process, where the candidate and the representative of the company find each other and decide whether there is mutual interest in moving forward.

Notice that:

  • sourcing is not just searching.
  • sourcing is not just dealing with passive candidates.
  • sourcing can be done by a sourcer, recruiter, HR representative or even a hiring manager depending on the process at the given company.

It is no coincidence that we use terms like passive sourcing, active sourcing, direct sourcing, phone sourcing or internet sourcing: there are many ways how you can find the candidates or you can encourage the candidates to find you.

3. So, then the sourcing strategy is…

A long-term plan of how you will establish and uphold the continuous flow of the targeted talent to your company’s recruitment process and how will you edge out the competition looking for the same talent.

That means:

  • You do not have a sourcing strategy for each and every position
  • But you should have multiple sourcing strategies for the different type of talent you seek (think about dividers such as seniority, industry, white-collar/blue-collar, geography)
  • Your company does not need a sourcing strategy for a type of talent where everything works already great and you anticipate no major changes
  • It’s a long-term plan, meaning you do not take the status quo granted, but think about trends and changes in the industry
  • You focus on best practice and push the boundaries for “even better practice”
  • Strategy is not a collection of tools you will use. That’s just one of the end products of your strategy.

4. Why create a sourcing strategy?

Creating a sourcing strategy is a good way to prepare to source a new type of talent or for a new challenge with the known talent. The challenge may come from the quantity of candidates (you need much more than so far), timing (you need them faster, at a special time, or continuously for a long period) or a change in the behaviour/structure of the talent pool.

Unfortunately many lose the above goal and try to create a sourcing strategy to simply impress a client, a stakeholder or a manager. While a good strategy certainly has the ability to help you with this, if impressing is your primary goal, instead of bringing value to the process you just waste time on summarizing your current actions. Beware: this limits your thinking so may be even more dangerous than doing nothing. Only create a strategy if there is real need for one!

The desire to impress #recruitment managers or clients is not enough to start creating a #sourcing strategy CLICK TO TWEET

On the other hand, when you have finished the strategy, be sure to share it with the appropriate audience – a little visibility in the eyes of your management, hiring community or client never hurt anyone.

5. While we are this: So what’s a recruitment strategy? And why to create a sourcing strategy, not a recruitment strategy?

Just as sourcing is part of the recruitment process, the sourcing strategy is part of the recruitment strategy. Besides further steps like interviewing, assessment, on-boarding, a recruitment strategy should involve much more work organisation/resource allocation questions. For practical reasons (time, effort, value-add) and because of sourcing being perhaps the most crucial part of the recruitment process it may make more sense to narrow your focus to a sourcing strategy. Also, do not forget that typically the stakeholders and the decision makers on the proposed steps differ (in other words you need higher involvement for a recruitment strategy).

Guide to create your sourcing strategy

Now that we discussed exactly what a sourcing strategy is, it’s time to learn how to create one.

1. Format

Classically strategies are written documents with 20-50-100-200-2173612876391268793 pages. I believe we already passed the era (were we ever there?) when people read so long documents, so if you do not want your reader to only read the introduction and the end conclusions, you may want to pick a different format. Except if you want to impress someone with the sheer amount of printed papers you throw at their desk – after my explanations above hopefully that is not your goal.

Better visualisation of your analysis will help you come up with better conclusions. Using a slide format is much more visual, and chunks the information into more digestible and understandable pieces. Plus in most cases you work together in a team, you have a manager, a hiring manager or if you are on the agency side various client representatives. You will most likely show the strategy to them in a presentation, so it’s a smart move to already prepare the strategy in slides.

2. Content

Now that you know all this it is time to prepare a process redefining, stakeholder charming and world saving piece of strategy. Generally speaking strategies consist of a short introduction to the situation, an analysis of the factors, conclusions drawn from the diagnosis and – if they are not fake materials existing just on paper – end with an action plan. The below 9-step guide shows how this looks in the case of a sourcing strategy (click here to open a bigger version).

2.0. Inputs

The sourcing strategy derives from the business plans (coming from company strategy) and HR strategy. The first part of this statement is obvious: you will need to hire people to divisions/markets where growth or big fluctuation is expected. If you diagnose there will only be a spike in required workforce, not a constant need, then hiring may be a bad decision in the first place. This leads to a very practical thumb rule: if the business can not predict the employment needs with at least some degree of certainty, there is not much sense in trying to think in a strategical way.

Alignment with HR strategy is equally important. Are you a company with relatively low average salary level hiring and developing young talent or are you the company with high average salary who routinely picks off these companies? On a related note, what is your training and development strategy? Do you invest in your employees growth? Internally or externally? How does your career management system work? Is there one in the first place? Is the primary function of your performance evaluation system to measure & reward, or to identify & develop?

All these questions will impact who are the right candidates for you.

2.1. Summarize the need

Your strategy starts with summarizing the employment need based on the inputs above. This is a very brief introduction of the situation and the timeframe.

2.2. Pinpoint the challenge

Essentially you have to explain why you have created a sourcing strategy. In the chapter “Why to create a sourcing strategy” I have mentioned that the primary needs for a strategy are new type of talent or a new challenge with the known talent. Sum these up here!

While sharing the strategy with the team or presenting to stakeholders, this is the part which should grab the attention and set the scene.

2.3. Defining the targeted talent

There are many ways how you can do this. Depending on how strictly you target you might go for something really concrete like personas or just a broad description. Any way you do this, be sure to go beyond job descriptions. The actual tasks are not the important part, the skills, qualifications and personality traits are the dimensions which define what ‘talent’ means for you.

2.4. Understanding where is the talent now

By now you explained what you seek –  this is the part where you start looking where you might find this. Threat “where” as a question as broad as possible:

  • Which geographical area is of your interest?
  • Maybe you should look for candidates from another region, or another country?
  • What communities are they part of?
  • What companies are they working at?
  • Perhaps in an entirely different industry?
  • In which schools/educational institutes they are developing themselves?
  • What events are they participating in?
  • Where are they spending time online? Forums, social media, blogs, websites, job boards?

2.5. Predicting where the talent will be in the future

Suiting profiles change, habits change and generations change. Analyze the economical, industrial and social trends and think about the same questions as in point 4  – but now in 2, 3 or 5 years (depending on the timeframe of your strategy and the speed of change).

Again, think broadly! Find reports, analysis and prediction. Look for comparable situations (how things happened in a different country/industry). Talk with industry experts in and outside of recruitment. Talk with some of the current candidates you have in the process or employees you have already hired.

2.6. What are the competitors doing?

Competition in this context means both the direct competitors of your business and everyone else who is on the hunt or will be on the hunt for the same talent.

  • How are they sourcing now?
  • What are they doing to prepare for the future?
  • How are you different from them?
  • What are they not doing and why?
  • What are you not doing and why?
  • What can you use to position yourself better than them?
  • How will the candidates hear more and better things about you?
  • Why will they choose you in the end?

2.7. Sourcing Mix now

It’s time to translate your deep analysis to the recruitment industry. By now you have a good understanding where your talent is and what your competitors are doing. So think about:

  • What channels are possible to use?
    • Online advertising (job boards, social media, SEO)?
    • Direct sourcing (search on job boards, social media, forums or web)?
    • Referrals (internal or external)?
    • Phone sourcing?
    • Headhunting?
    • TV ads?
    • Print ads?
    • Radio ads?
    • University programs?
    • Events?
    • Involving third-party agencies?
    • Cooperation with NGO-s and professional organizations?
    • Unemployment agency?
    • Internal sources?
  • Out of these, which are worth to use?
  • Which will result in best ROI?
  • How are you going to communicate with the candidates?
  • What should your message be?
  • How you should present your message?

Sourcing Mix is a term I borrowed from Marketing – in the line with the famous 4P (Product, Price, Place, Promotion) as known from the Marketing Mix. A future article is coming on this topic – if you do not want to miss it, subscribe here with just an Email address.

2.8. Sourcing Mix of the future

If your talent pool, or the way how you can reach the candidates in it are prone to change over time, it is natural that your methods should change as well.

Revise your Sourcing Mix keeping in mind what you discovered about your future talent. Add new elements and plan to eliminate old ones. It might be worth to add tools to your mix which are not work the best now, but you expect to rely on them more and more – better be early than late. Being an early adopter means a competitive advantage, but that is not the only way to differentiate yourself. Think out of the box and try not to limit yourself to what you are used to do.

Thinking out of the box can help you out with formulating or changing your message as well, but do not lose your identity while trying to be different and creative. You certainly can and should change your message over time, but stay true to your organization’s identity and general strategy. Not everyone is Google or Coca-Cola, and not everyone should be.

2.9. Checkpoints, measurement

You worked out your sourcing mix for now and for the future so now you just have to execute it, right? Well, not so fast. You certainly used all the data you could gather to predict which methods are the best for you, but there is no guarantee everything will work out the same way in reality as it looks on paper.

The solution is to make sure you will be able to measure and compare the elements of your Sourcing Mix (I wrote here on this topic earlier). Depending on your decisions earlier and the talent scope of your sourcing strategy this may range from a source and conversation ratio tracking to complete revisions of your employer brand. Plan what are the most likely causes why you could get off track, and be prepared to intervene in time. A good practice to make sure you act in time is to set up revision checkpoints – for example if source A is not reaching the efficiency level of X/week, or if Y% of candidates have a negative experience  – when you have to intervene.

3. Preparation

Strategical thinking is fun and brings great value to your organisation, but ultimately your goal is not have a good strategy but to hire the most suiting people to run your business. It’s time to put together and implement the operative plan on how you are going to bring your sourcing strategy to life.

Three last tips

Working out a coherent sourcing strategy can be a very challenging task. Before you start, make sure you have the backing of your stakeholders or otherwise it’s very likely that your well-thought out strategy will not bring much yields.

Generally speaking involve everyone who might have a valuable point of view on the subject of your talent or your recruitment process. More eyes see more, and more minds are capable of thinking further.

Share the above with your colleagues and coworkers so you have a common ground on what are you working towards. There is nothing more hindering cooperation than not being aligned on the goals.

 Phew…

It’s not easy to read and process such a robust material. If you have made it so far I am sure you found value in it.

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