For smaller organizations with limited HR resources, there comes a point when it needs to consider hiring an internal recruiter. This is typically when the business' hiring requirements become too demanding for the person/people involved. They can either engage a recruitment organization at this point, or in-source recruitment by hiring a dedicated internal recruiter. Whichever the case, it's essential that the (often hidden) advantages and disadvantages are fully understood.
Here are some points to bear in mind if you’re looking to hire an internal recruiter.
Advantages of Hiring an Internal Recruiter
The principle of hiring a recruiter is no different to any other hire. It is essential that you understand exactly what type of recruiter and skill-set are needed. There are a plethora of skills, experiences and qualities against which you can measure the candidates. Should there not be an experienced internal HR Manager in place, who knows the needs of the business, you should seek expert and impartial help.
The first and obvious advantage of having an internal recruiter on your payroll is that the person works for you - they have no other external agenda to satisfy. So, your interests are his/her interests. They aren’t motivated by pushing a higher salary (i.e. higher commission) for the people they recruit. They also aren’t focused on external KPI’s and should have only your business' best interests at heart.
Secondly, there is the potentially dramatic reduction in agency spend. The right recruiter should (mostly) remove the need to use recruitment agencies, meaning significant cost reductions.
Thirdly, if you have chosen correctly, a good internal recruiter should come to your business with an established network in your specific field. This reduces your time to hire, by access to a ready-made talent pool.
There are other less measurable (albeit important) advantages:
- A consistent approach to the market.
- Someone who can properly explain your business to potential candidates - and sell the benefits of joining your company.
- Your recruiter should be a brand ambassador. He/she should look at innovative ways to increase your employer brand (such as setting up a formal referral process).
Disadvantages of Hiring an Internal Recruiter
On the surface, the cost savings of hiring an internal recruiter are obvious. However, it’s important to factor in ALL the costs involved in an internal recruitment team. Here’s a quick checklist (with links to examples) of the typical needs of an internal recruiter (aside from the usual employment costs):
- Access to a premium LinkedIn account
- Advertising budget for job boards such as Glassdoor
- Applicant Tracking System
- Assessment Tools
- ID Verification and Referencing services
- Sourcing tools (such as databases, plugins, etc.)
- Career site
- Training and Development (it's a rapidly evolving industry!)
It is important to consider these costs early-on when calculating in the benefits of having an internal recruiter. Too often they are overlooked - then the recruiter comes on board with their wish list..........
Just to flesh out why I've advised that there must be an advertising budget provision. That talent pool your internal recruiter brings, while very useful, can often be insufficient. There are a number of reasons why; you have a high volume of vacancies being filled at any one time, different skills needed, etc..
Internal recruiters can quickly get bogged down with basic administration tasks such as; managing job applications, internal emails, giving feedback, etc.. For cost reasons, external recruiters only offer a basic level of service, if requested to do so. So the internal recruiter has less time being strategic and hunting for talent (what you hired them for in the first place!). Be careful, all this can result in the need to engage recruitment agencies more than you planned, or budgeted. You then risk defeating the reason of having an internal recruiter.
Options to Hiring an Internal Recruiter
Recruitment Process Outsourcing (RPO) is common across enterprise organizations. These businesses offer fully managed recruitment services and come with some fantastic benefits. However, they typically aren’t designed to work for SME businesses (unless there’s a truly significant project).
Commercially it wouldn't make sense to them, or to you. They predominantly rely on having onsite resources, which naturally comes at a premium.
Until recently, there have been few economically viable recruitment outsourcing alternatives for smaller organizations. There are a small, but growing, number of SME focused Managed Recruitment Service (MRS) Providers. To be able to address the needs of SMEs, these organizations typically combine technology and human capital to deliver recruitment services. Their pricing models are usually a lot cheaper than using an agency. They can also offer additional services that you would never have thought relevant:
- The powerful service of candidate management
- Employer branding
- Access to heavily discounted advertising
Due to their low pricing model, they can also offset/delay the needs of hiring an internal recruiter. If a recruiter is in place, they can offer point services, ongoing, or on-demand during peak hiring times.
An MRS would typically deliver your recruitment projects online; the reason why they can offer significant cost savings. Another benefit is having clear metrics and reports that are directly related to the quality of your business hire(s).
Not all have complete service offerings in place. Therefore it's important to take time in assessing their methodology, their people, technology and tools. So, speak with some of their customers to ensure that what you need, is fully available.
Consider your options carefully before making a decision. Look at all the real costs, pros, cons and alternative solutions. Hiring an internal recruiter certainly has real advantages but there are also considerations and alternatives.
Feel free to download our Recruitment Budget Calculator to help you analyse your costs:
Every organization has its own market and internal dynamics. So at the end of the day, you have to weigh up what solution best fits your business.
I hope this has at least given you food for thought.