The Recruiting Gap: Why 99% Have Given Up Competing With Google

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Mar 18, 2014

First of two parts

If you’re an executive interested in recruiting, here is a scary thought to consider:

For the first time in your lifetime, as a result of their compelling approach to managing talent, the elite 1 percent of firms now have a powerful recruiting brand advantage.

The resulting “recruiting brand gap” between the top 1 percent and the remaining 99 percent of firms is now so wide that most firms have given up trying to match the talent approach of the 1 percent.

The Top 1% have unique talent differentiators

You might not be aware that there is a “recruiting brand gap,” and you will probably be further surprised to learn that most firms have given up trying to eliminate it. Let me begin the discussion by defining who the elite top 1 percent of firms are and what separates them from the remaining 99 percent.

Envision a dozen corporations, represented by firms like Google, Facebook, and Apple, who manage talent in a radically different way than the average Fortune 500 firm. You probably already know about the highly publicized talent features of this 1 percent of firms, like 20 percent time, free food, pick your next job, free bus and ferry rides to work, a free barbecue joint, and not even tracking sick leave or vacation time.

However, you may not be aware of the three foundation “talent differentiator factors” that dramatically separate this elite group of firms. The three differentiators are:

Differentiator #1 – They manage their talent completely differently

Firms like Google manage talent in a unique way.

While most firms are focused on providing a good job, reasonable pay, and security, elite firms stand out, first and foremost, because they manage with the goal of providing employees with the opportunity “to do the best work of their lives.” This focus is important because “doing the best work of their lives” and having a major impact are the top two attractors of top performers and innovators.

Part of doing your best work is a management approach that offers extraordinary opportunities for employees to innovate, and a degree of freedom, extreme risk-taking, autonomy, and radically delayered organizational structures that the remaining 99 percent have been unwilling or unable to duplicate. Because they focus on these two primary attraction factors, these 1 percent firms have produced extraordinary results.

For example, Google and Facebook each produce more than a breathtaking $1 million of revenue per employee every year, and Apple employees produce over $2.1 million. Their unique talent management approach also leads to extraordinary market value.

And, Apple is No. 1, and Google is No. 3 on the list of the world’s most valuable firms in market capitalization. Facebook is already at No. 17 and it is continually moving up despite it only been in existence 10 years.

Differentiator #2 – They have powerhouse employer brands

Because of both the way they manage and their extraordinary business results, the employer brands of these firms are dominant in the talent marketplace. As a result they can continually grow and dominate their industry segment because they can successfully attract and hire an endless number of truly exceptional performers, innovators, and pioneers from around the world.

Google, for example, has the world’s No. 1 employer brand. It has been listed in first place by Fortune magazine as the “Best Companies To Work For” for four of the last five years, and that it has topped the Universum list for the best employer for college students for the last five years. Apple and Facebook are also regularly recognized as top employer brands on various social media websites.

Because of their company image, each of these elite firms is able to attract an extraordinary number of applicants each year. If you are competing against them for the same candidate, the chances of your firm winning are minimal.

Differentiator #3 – They make extraordinarily powerful business cases

Elite firms offer amazing talent management features, stunning work sites, and employee benefits (like free transportation and free food) that executives at other firms would consider frivolous.

However because they are all public corporations, executives at any of these firms simply wouldn’t be allowed to offer these extraordinary benefits without excelling at metrics and making a business case to demonstrate the high impact and the ROI of each talent feature.

Can you imagine asking executives at your firm to approve a free ice cream store (like they have at Facebook) without a powerful business case?

Of the three foundation differentiators, the easiest one for 99 percent firms to match is the capability of making a powerful business case for funding the talent features that make the 1 percent so productive and innovative. However, even though it is easy to copy, I have found, to my surprise, that this business case for talent capability is almost nonexistent among HR executives in the remaining 99 percent of the firms.

Most talent managers acknowledge the “Recruiting Brand Gap”

I am fortunate to have the opportunity to interact with hundreds of talent management leaders each year. And during his interactions talent leaders, almost without argument, readily acknowledge the “recruiting brand gap” between their firm and elite firms.

Without exception, they are sometimes painfully aware of the extraordinary strength of the employer brand image of elite tech firms like Google, Facebook, Apple, and SAS and non-tech elite firms like Zappos, Costco, and Amazon. They are also well aware of the metric-driven talent approach at Google, the extraordinary serial innovation emanating from Apple, and even the extraordinary customer service provided by elite firms like Zappos or Rackspace.

But the surprise comes when I (or any outsider) suggest to leaders in the 99 percent group that they should try to emulate even a few of the WOW talent features at the elite firms.

Surprisingly, the answer to that “why-not-try-it? suggestion” is almost always some variation of the excuse “no, our executives would never even consider that.” In fact, I frequently receive the following criticism from among talent leaders at the 99 percent:

Why do you always use Google (or Facebook and Apple) as examples … when our firm can never be like Google?

Tomorrow: The reasons why most companies have given up on matching elite companies.