There are some unusual, unpredictable, disruptive things going on. The status quo is being challenged, our assumptions being questioned, that which we knew to be true undermined. World order is being turned upside down. Much of it we cannot answer, its scary, exciting, it creates opportunity. Some people are grabbing it, some people are stood frozen, helpless, like a rabbit in the headlights.
Take retail. The traditional model is under enormous pressure. Look at HMV. It has no substantial high street rival and yet it is in ruins. We all know what happened. Itunes. We download our music. Online rivals don’t have the additional costs that come with staff, utilities and town centre property. Online, the world is your shop window. The internet now accounts for £1 in every £10 we spend shopping.
The business press is full of its usual doom and gloom and focusing heavily on retails woes. Yet look at the success story that is ASOS. UK sales have risen by 59% in the last three months. International sales at ASOS have risen 159%. So what is it that ASOS is doing that many other retailers aren’t? They have taken a traditional model and applied technology to deliver a better experience for customers at a better price. It has become the “one stop fashion hub” for 15 to 25 year olds (and older!). This month they launch a fully integrated Facebook store. Brilliant.
I should confess here, I hate shopping. I have about a one hour shopping tolerance, therefore online is a lifesaver for me, clearly I am biased. In the spirit therefore of balance, lets talk Books. I love them. Give me a bookstore and a coffee and I am a happy man My local Borders had a Starbucks and I had no mobile signal in the store. I used to hide out in there. My refuge has gone.
The kindle was Amazon’s biggest selling item in the UK last year. My wifes 79-year-old Grandmother has one and she loves it. We can read at the touch of a button and its brilliant. Even for a book lover like me.
So what about the recruitment industry? In 2007 recruitment in the UK was a £27 billion business. In 2010 it was £19 billion. At the same time employment levels have dropped from 72.6% to 70.3%. Clearly we have had extremely challenging economic times and unemployment has increased significantly, but to the extent that we have lost 30% of our market?
Historically the value in a recruitment business was in its database. That and its people. What distinguished one recruiter from another was the calibre of candidate on its database and the ability of its people to deliver the right candidate to the client. We protected that database as if our lives depended on it, rightly so.
Now that database is published to the world. Facebook, Twitter, Linkedin. The world is connected. Our ability to filter, to cut through the noise, is still of enormous value but increasingly employers are becoming smarter at filtering for themselves. 75% of hires in investment banking are direct hires. The CiPD evidences 72% of vacancies never make it to the public domain. Never a truer adage not what but who you know.
What is going on here? The times they are a changing. The recruitment industry has not changed its model for 80 years. Innovate or die. It is time for revolution.
What will we look like in five years time? Historically we were a bricks and mortar model. Is this still necessary? We are still a handshakes, face to face business, but increasingly we can reach an ever wider pool of talent virtually. How will this effect the customer experience?
I have some views, too many for one blog post. It occupies my mind virtually every waking hour. I am taking steps, making plans to address it ( Watch this space ). In the meantime, what is the future of the recruitment industry? HMV or Itunes? What will be the recruitment equivalent of ASOS?
This is an important debate for an industry that I love. I would love to hear what you think.