Candidate Investment: Finding Undiscovered Talent
This article was updated on Sept. 14, 2018.
According to the Society for Human Resource Management, more than two-thirds of organizations have a difficult time filling job openings. With talent markets as competitive as ever, recruiting methods need innovation to stay ahead. Organizations should consider broadening candidate investment options in order to find needed talent.
But what does that have to do with "Rocky," a five-time Super Bowl Champion and a character Will Smith once played in a movie?
What Organizations Can Learn From "Rocky"
It's a common misperception that Rocky Balboa was a blue-collar fighter who worked his up the ranks to become a heavyweight championship contender. But in reality, he was chosen by Apollo Creed, who needed to find an opponent with the right mix of "talent."
Heavyweight champion Apollo Creed was scheduled for a fight in Philadelphia on the bicentennial. When his scheduled opponent got injured, Apollo had to find another fighter. Instead of searching through the traditional talent pool of ranked boxers, agents and fight promoters, Apollo decided to find a local fighter. The challenge was to find a local with the right combination of technical skill, cultural fit and potential.
Rocky fit the bill, and proved that his lack of expertise at that level was in fact not a detriment to his chances of success.
The Value of Undiscovered Talent
Tom Brady was drafted in the sixth round of the NFL draft in the year 2000, passed on by almost every team except the New England Patriots (who in reality passed on him five times). Brady earned an approximate first-year compensation of $231,500, thousands below the $1 million average NFL salary, per Spotrac. If you compare the early acquisition cost of Tom Brady to the benefits realized by the Patriots, the value he delivered was exceedingly high over his career.
This phenomenon is not limited to sports. Documented in the true-story movie, "The Pursuit of Happyness," Dean Witter Reynolds, a top investment firm, took a chance and hired a homeless Chris Gardner into their training program. Gardner excelled as a top performer and went on to found his own firm.
When you compare the potential returns with the below average salary paid to inexperienced employees and the training, mentoring and opportunity costs of hiring more traditional candidates, the value to organizations is clear. Finding and leveraging untapped talent leaves a wider margin between the total cost of the employee and the production of that employee.
From Theory to Practice
Although this tactic seemingly flies in the face of conventional recruiting measures, finance leaders should give this disruptive recruiting method careful consideration. With average starting costs of undiscovered talent below average and the potential upside of financial returns so high, finance leaders can work with HR and the executive team to create a pilot program to focus on the recruiting of undervalued talent.
1. Understand the Risks
Although there is high upside, there are risks. Undiscovered talent is often undiscovered for a reason. There could be more misses than hits. The team should understand this and agree that it's a risk worth taking.
2. Implement Success Metrics
How will such a program be measured? By increased revenue per employee? With anecdotal case study examples?
3. Budget Accordingly
In his book, "Zone to Win: Organizing to Compete in an Age of Disruption," Geoffrey Moore suggests businesses looking to invest in disruptive technologies should operate such investments as separate units from the rest of the organization, almost like its own autonomous startup within the larger organization. An undiscovered talent search program should run as a separate team under the HR leader, if only to allow it to pursue unorthodox measures.
4. Commit to a Trial Period
If leaders can't agree to pursue such a program for the long haul and stick it out through early lulls, it shouldn't be pursued. Without a full commitment, results might not have a chance to unfold.
Innovation in Talent Acquisition
There are many examples of success coming from finding and developing undiscovered talent. Businesses don't get to the next level by doing what they've always done. A portion of what organizations must consider is continuously pursuing high potential returns in candidate investment innovation.
