Strategic Sourcing

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Strategic Sourcing

• Martin Crysell

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The Larger IssueProjected U.S Workforce
Availability Versus Workforce Demand, 2002 - 2010
Crossover point occurred 2006
There is very little slack in the system. When
the economy heats up, that slack will be taken
up, and we will be right back to tight labour
markets. Sylvester Schieber, Ph.D.Director od
ResearchWatson Wyatt
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Firing on All Cylinders (or Not)Organisations
track record becomes much more problematic when
one considers the combination of three
goalsOverlap of Right Organisation Fit, Right
Job Fit, and Effective Workplace Adaptation
Organisations get the right person for the job
and the organisation, and onboard them
effectively, only 7 percent of the time.
but get the right person for the organisation
only 29 percent of the time
and effectively onboard new hires only 11
percent of the time.
Organisations get the right person for the job
51 percent of the time
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The U.S. Department of Labour estimates that
todays learner will have 10-14 jobs . . .
.by the age of 38.
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According to the U.S. Department of Labour ..
1 out of 4 workers today is working for a
company they have been employed by for less than
one year.
and more than 1 out of 2 are working for a
company they have worked for less than five years.
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According to former US Secretary of Education
Richard Riley . . .
the top 10 in-demand jobs in 2010 didnt exist in
2004.
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Strategic SourcingWhat it is and what it is not
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Strategic Sourcing is based on key principles

• Leveraging the organisations employer brand and
  value proposition to create powerful attraction
  and retention mechanisms
• Talent exists both within, and external to, every
  organisation and effective recruitment combines
  internal and external recruitment
• Line management needs to own individual
  recruitment outcomes supported by robust
  recruitment processes

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Strategic Sourcing is based on key principles

• Enhanced performance outcomes are optimised by
  having a well developed talent strategy,
  re-engineered processes and a performance
  management framework which drives the right
  behaviours
• Technology is a process and performance enabler
  but should not be considered to be the total
  solution
• Cost reduction is one of the outcomes of a robust
  outsourcing model, and most often a significant
  one, but should not be a primary driver

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Attributes of the Employment Brand

• There are 5 attributes that the labour market and
  employees perceive as the value they gain through
  employment in the organisation
• The Opportunity a job/ organisation affords an
  employee, such as development experiences
• The nature of the Work itself, such as the extent
  to which it matches the employees interests
• The characteristics of the Organisation, such as
  size or market position
• The tangible Rewards an employee receives for
  his/ her work, such as compensation and benefits
• The characteristics of the organisations People,
  such as manager quality

These attributes directly impact Attractiveness
and Commitment
(Source Attracting and retaining critical Talent
Segments, Corporate Leadership Council 2006)
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Where are the wins?

• Job Brand Awareness
• Highlight day to day experiences in recruiting
  materials
• Include testimonials from employees from
  different areas of the organisation on the web
  site
• Provide clear concise messages for hiring managers

Organisational impact

• Post offer
• Tell candidates why their position is important
  when communicating the offer
• Let candidates contact their future peers in the
  organisation

• Interviewing
• Do not waste the candidates time on non
  essential activities
• Avoid asking redundant questions
• Ensure candidate information is collected only
  once.
• Link and assessment questions and answer to
  performance management.

Degree of difficulty
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Organisations are achieving strategic sourcing by

• Engaging a specialist service provider in an
  outsourcing management model that has limited
  reliance on traditional margin based reactive
  practices.
• Measuring the impact of the recruitment services
  beyond cost and time per hire, and determining
  how the recruitment services provider impacts new
  hire performance, internal mobility, workforce
  planning, and employment brand.

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Strategic Sourcing is here

• The model has also been developed in a New
  Zealand and Australia over the last five years
  and has been deployed successfully by Government
  agencies and private sector organisations such as
  ..

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Strategic Sourcing is about getting the right
people into your organisation at the right place
and right time

• then recognising that once you have the right
  people in your organisation managing their
  performance effectively is key to achieving
  organisational capability
• and having effective tools and clear line of
  sight to performance is essential.