The origins of American outsourcing are found in “third party recruiting” (TPR). The Recruiting task is so complex and innovation so rapid that most companies choose to outsource some component of the work. Long before there were organized process oriented management companies (RPOs), the “headhunter” moved onto the organizational stage.

In good economic times, about 500,000 people work in the TPR niche. They range from contract recruiters to tony boutique firms resembling investment banks. They fill slots for every aspect and level of the labor market. The rich diversity of business models and target markets makes it extremely hard to generalize about the various TPR operations.

TPRs come in a variety of flavors:

• Retained Search Firms (Sometimes Called Executive Search)
• Contingency Search Firms (Working for a percentage of annual salary)
• Contract Placement Agencies (Generally Technical Contracts, high-end Temporary)
• Staffing Firms (Temporary Help)
• Contract Recruiters (Guns for hire who maintain a desk inside a corporation)
• Recruitment Process Outsourcing Companies (RPOs)
• Sourcers (who provide names and connection but no closing services)

Each of these types of business approaches the task of providing labor from a different perspective. Within the industry, there is a strong differentiation between ‘temp agencies’ and ‘executive search firms’. The differences (since even the most permanent hire lasts about 3 years) has more to do with the relative status of the employees being brokered than the duration of their employment. TPRs make their money on the same basis as the people who they process: salaried employees are priced as a percentage of annual wage; hourly employees are priced as a makeup on each labor hour.

The animosity between TPRs and internal employees working in HR is the stuff of legends. One side views the other as lazy and stupid. The other side sees its external competition as opportunistic and overpaid. Good communication between the camps is a rarity.

To complicate things, the TPR universe is the source of all interesting innovation in Recruiting and most of HR. The reciprocal animosity is one of the primary barriers to the rapid adoption of new technologies that work. The situation is so intense that one never sees TPRs briefing new technology at HR related conferences. This is in spite of the fact that all of the interesting new techniques have emerged from TPRs over the past 40 years. Fax machines, web sites, job boards, SEO/SEM, social recruiting, community development, email marketing, profiling all have their roots in the world of TPRs.

It’s a simple thing to explain. The only relative advantage a TPR ever has is speed. New technologies are the only source of new speed improvements. Finding them is a question of survival for all but the most networked, button down, good-old boy recruiting operations.

Bill Vick has been the driving engine behind the TPR segment’s innovation for almost two decades. With a history that ranges from the Marine Corps to the Fuller Brush C, Vick has led the life of an entrepreneur in a wide variety of forms. He’s half sales genius, half nerd. He says, “I’ve never met a gadget I didn’t like.”

A Karate sensei, Vick entered the Recruiting business after a long and varied career which included a stint where Zig Ziglar was his boss. In the 80s and early 90s, MRI revolutionized the TPR world with a system that provided consolidated training and services for franchise holders. Vick went to work for what is arguably the most interesting franchise in MRI’s history, the Dallas off that eventually became Kaye Bassman. A recruiting natural, Vick began breaking all sorts of records. No matter how great his success, he never lost touch with the computer industry (he founded and ran a chain of computer stores in the early 80s). With over 20 years in the Recruiting trenches, Vick offers the unique perspective of someone who knows the business and how to improve it.

In the early days of the web, Bill founded and grew the Recruiters Online Network, a precursor to today’s recruiting communities. The network featured recruiters who helped each other fill openings, share long-distance expenses and collaborate. These days, he continues to expand the effectiveness of the Recruiting profession through a couple of key initiatives:

• Extreme Recruiting TV Showcasing the use of video, Vick interviews the thought leaders and real performers. If you want basic Recruiting training, watching all of Vick’s videos is a good start.
• EmploymentDigest.net is an ongoing set of essays about the labor market.

Bill Vick exemplifies a necessary kind of influence. Over the years, he has been willing to make grand experiments in public places. By risking real failure, he creates the opportunity to demonstrate the utility of a new idea or technology. In an arena where influence usually flows from an advertising budget, Bill Vick sets an extraordinary example.

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The HR-Recruiting Industry has a huge variety of subcultures and niches. There is no such thing as a standard set of practices in the industry. The regional and tribal nature of our organizations change the face of HR-Recruiting from town to town and industry to industry. You do the whole thing differently if you run a southern heavy manufacturing plant than a (more likely unionized) plant in the north. Neither Northern nor Southern heavy manufacturing operations resemble the HR-Recruiting found in high tech in the northwest or chip design operations near Austin.

Even in the same company, HR-Recruiting practice varies widely based on the work done at a particular organization.

In some ways, it’s easier to understand HR-Recruiting as a market than as a profession. With no standards, no serious accreditation processes, no observable Research and Development, no obvious innovation, little in the way of governance and a sea of untested assumption, the industry might be better understood as a frontier in need of some lawmakers. Certainly, there’s an ocean of opportunity awaiting anyone who can solve the professionalization problem.

There is one area of the game that behaves somewhat differently. The ‘enterprise space’, the haunts of the Fortune 2000, consumes a disproportionate share of the goods and services sold to the HR-Recruiting Industry. Enterprise products and tools, like Taleo, Peoplesoft, the emerging Workday and a host of others operate in a unique environment that is unlike the rest of the field.

Great companies aspire to be big. As a result, little companies that hope to become giants emulate the techniques and behavior of their larger brethren. Although giant companies operate in ways that would kill a smaller firm, the brands and logos of the big operations hold sway with ambitious CEOs who don’t want to be considered small. The behavior resembles young boys who are finally growing into the clothes in the Men’s department or kids who are tired of Happy meals and children’s portions.

The Enterprise space has enormous influence in the HR-Recruiting industry. Huge vendors have the booths that dominate the trade show floors. They take the biggest ads. Regardless of merit, they set the de facto standards for many things

Bill Kutik, occupies a key role at the heart of the enterprise space. On one level, he is a monthly columnist for HRExecutive Magazine and the co-host of the annual HRTech Conference. His radio show, which reaches hundreds of listeners a week, is influential beyond its audience.

Kutik knows everybody. Immensely proud of the 75 or so panels he’s put together over the years, Bill is a charismatic salon keeper. He makes connections and shows the limelight to a select audience. Bill’s imprimatur is the key to success for many new entrants to the industry. His annual shootouts always shape the industry’s view of new and improved product offerings. Kutik is the arbiter of what’s important in the enterprise arena.

A Harvard educated reporter, Kutik worked for the New York Times and is said to have covered the Claus von Bulow trial.He’s the consummate New Yorker and knows the nooks and crannies of his home. These days, he operates from a cozy little bungalow in Westport, CT where he shared office space with Paul Newman.

In Kutik’s case, influence is something to wield. From a distance, it seems like he takes an activist role in the industry, intentionally shaping opinion and experience. That’s essentially what a conference co-host does. Kutik simply takes it to a higher and more effective level.

Recruiting looks very different from the Fortune 2000 perspective. While the function must be strategic and hyper competitive, the enterprise audience is particularly risk-averse. From the halls of traditional HR, Recruiting can look really out of control and over-innovative. Part of the reason that Recruiting tools have had some trouble taking hold is that change moves at two distinct paces inside our industry. An approach that keeps up with the evolution of traditional enterprise solutions simply moves too slow for effective Recruiting strategy.

Kutik manages the difference with success. Without his influence, the evolution of HR in the enterprise space would have naturally ground to a halt. Though things move very slowly in that environment, it’s Kutik’s careful prodding that makes innovation move.

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