No Openings? No Matter: The Case for Evergreen Hiring

The hiring market is fierce with top candidates being snagged left and right by leading competitors. But Dr. John Sullivan, an HR thought leader based in the Silicon Valley, argues that evergreen recruiting strategies can help companies can make sure that they get to ripe talent before anyone else. What's more, case studies show, continual recruiting can reap positive ROI.

We asked him to explain the value of having too many employees, rather than not enough.

Why should companies bake evergreen recruiting into their hiring strategy?

The major reason is the cost of a vacancy is so high. If you have a vacancy in a key position, say a sales position or nursing position, you lose revenue. When you say, ’I can’t afford to have this position vacant,’ well what would be the consequence of having too many people? Most people say, ’I would open new functions, offer new products or extend my hours,’ so there’s no negative consequence.

A hospital in Minnesota hired too many radiologists, so it started a temporary service by renting out the radiologists to other hospitals. It made a million dollars, but also got to figure out if these radiologists were any good. One of the smartest things I’ve heard is if you hire too many, start a temp service. Don’t put them with your competitors, but put them in other hospitals and use it as an assessment tool and training strategy. When they’re really good, transfer them back into your hospital. They also learn new approaches from other hospitals to bring back to your hospital.

Does evergreen hiring work for companies of all sizes and in all industries?

It’s most applicable for the high volume jobs generally, like call centers, retail sales and nurses. The question you ask is what if I have too many; will it cost me money or will it be a benefit? In most cases in a competitive environment, if you have the top talent, you’re going to beat the competition. Some people hire with competitive advantage in mind, so competitors can’t have the talent. Cisco used to have a hire-to-hurt strategy and said, ’When we have them you don’t.'

How does evergreen hiring address the issue of the imminent skills gap?

Let’s say I want to hire Santa Claus. If you only recruit in November, there’s a lot of competition, but if you recruit in January there’s no competition. There might be a skills shortage in November, but there isn’t one in January. We call it coincidence hiring. Your skill set is available at the right time I have a job. But if you say I’m going to hire whenever the talent is available even if I don’t have an opening, that’s evergreen hiring. Most other firms wait until they have an opening, and that highly skilled person is only on the market for a week and has already been hired by the time your job opens. Don’t wait for the job opening. Hire when the skilled talent is on the market.

How can a manager convince the C-suite that evergreen recruiting is a powerful business proposition?

Most people think it costs money or takes recruiters too much time, but I’ve found it has a positive ROI, especially in hospitals or retail. You do this because it saves you money and doesn’t cost you money.

It’s simple math. Recently I worked with a bank that needed a loan officer, and when there’s no loan officer in the branch, customers walk out and go to another bank. The revenue generated every day by a loan officer is $5,000. The average vacancy at this bank was 100 days, so that’s $500,000 lost. That’s a lot of money lost because of a vacant position.

The same is true with a call center. You look at a ratio where if there are two call center reps per 100 customers, we get this customer service rating, but with one, we get a lower customer service rating. You’ve shown the C-suite the impact of being understaffed and having a vacancy.

Photo: Can Stock