Here are some key things to know about this up-and-coming approach to talent acquisition. 

What is direct sourcing? 

Direct sourcing leverages artificial intelligence (AI) to improve talent pipelining and create curated pools of qualified candidates. Direct sourcing reduces time-consuming elements of the recruiting process, such as sourcing and pre-matching, while ensuring sourced candidates are qualified and able to engage in work assignments quickly. The goal of a direct sourcing strategy is to generate vetted and active talent communities for specific locations, job functions, and/or job titles. When direct sourcing is incorporated in an MSP, these talent-related functions can be carried out by the MSP provider without having to engage secondary staffing suppliers. 

One direct sourcing platform, Opptly, says its technology draws connections between “the right workers and the right work”—similar to Uber’s marketplace which connects the right passengers with the right drivers, and Airbnb’s marketplace which connects the right guests with the right hosts. 

According to Staffing Industry Analysts’ 2023 Workforce Solutions Buyer Survey, 39 percent of respondents have already implemented direct sourcing, and 40 percent say they’re likely to seriously explore the strategy within the next 2 years—but not all organizations utilizing direct sourcing already are doing so within an MSP. 

Related: Improve Talent Curation with Direct Sourcing 

How is direct sourcing used in an MSP? 

In traditional managed service programs, providers align staffing suppliers to help fill open positions on behalf of their clients. When new jobs are released, they are equally distributed to all aligned staffing suppliers.  

While MSPs are effective in creating competition among suppliers, this solution can lack a pre-vetted pool of candidates and does not consider candidates who have applied directly to the client’s career opportunities. 

Implementing a direct sourcing approach within an MSP allows providers to identify active candidates that are interested in being considered for temporary or direct employment without having to connect with third-party staffing suppliers. Once pipelined, these job seekers can be curated into specific talent communities based on their unique skillsets, previous work experiences, and long-term professional aspirations. 

Related: Broadleaf’s Jason Krumwiede Discusses the Future of MSP Direct Sourcing 

What are the benefits of direct sourcing? 

Some of the most compelling benefits to incorporating direct sourcing strategies within an MSP include: 

• Reduced time-to-fill 
• Improved slate of candidates 
• Lower recruiting costs by as much as 10 percent 
• Greater recruitment efficiencies 
• More positive and consistent candidate experience 
• More opportunities to promote employer brand 

When organizations curate branded talent communities, they can more easily find candidates who are genuinely interested in working for them and engage with them on a more consistent basis. And when an opportunity arises that matches a candidate’s skill set, employers will be able to find qualified candidates more quickly. Job seekers also benefit from direct sourcing, as it can offer greater transparency than many traditional staffing solutions while expediting the hiring process. 

By utilizing direct sourcing as the primary source for all requisitions within the MSP, companies can reap the benefits of consolidated talent communities for both contingent and direct hire positions. This emerging workforce strategy can bring significant value to MSP programs, regardless of size or scope, and will remains an important trend to watch in 2024. 

Related: E-book: Evaluating and Implementing a Second-Generation MSP 

This blog was written by Jason Krumwiede. 

The post What Is Direct Sourcing? appeared first on Broadleaf Results.

Current trends across the industry

Flexibility in talent strategy has become increasingly critical in today’s uncertain economy, and companies are leaning on contingent workers and direct sourcing strategies from their Managed Service Program (MSP) partners.

• The ability to plug in a contractor specifically to fill a gap or skill set has become incredibly important to companies as they navigate economic headwinds.
• Sixty-two percent of enterprise organizations that use contingent workers have either implemented a direct sourcing program or plan to in the near future as part of their MSP or insourced programs.
• Direct sourcing to help augment contingent labor programs is still in the early adopter phase and needs to develop on the maturity curve.

Navigating the confusion

Direct sourcing in the staffing sector is “a value-add service of an MSP provider or organization’s insourced team. By leveraging their data and corporate employment brand to attract candidates, direct sourcing expands the contingent labor supply,” states Jason. However, the challenge lies in knowing what type of direct sourcing to utilize based on your organization and its needs.

There are three types of direct sourcing, each fitting into different recruitment service delivery categories. The chart below depicts the categories of providers and their focus.

Criteria used to determine direct sourcing readiness

You may be ready to implement a direct sourcing solution if your organization answers yes to one or all of the following questions.

• Are you looking to fill challenging job categories or skill sets faster—often corporate or professional roles?
• Are you seeking cost savings? MSPs can payroll referred candidates at a lower markup than staffing providers.
• Are you interested in capitalizing on the career site traffic created by your strong employment brand? Utilizing a strong employment brand is a crucial delivery channel for direct sourcing success.

Related: The Top Reasons Direct Sourcing Programs Fail

Six best practices of direct sourcing programs

Here are some best practices to consider when developing and managing a direct sourcing program.

1. Contingent labor is a complex process with many handoffs. An organization needs to invest in the correct technology platforms, such as LiveHire or Opptly, to establish entrance into the direct sourcing ecosystem.
2. Encouraging people to opt into your talent community either as a direct employee or contractor is essential. Even if a candidate applies for a full-time position, you want them to feel inclined to learn more about your company and any potential contract positions as they become available.
3. Segment the population to ensure the delivery of relevant information.
4. Curating the talent community requires constant communication with candidates and providing them with engaging information about your company.
5. Pushing out relevant jobs, especially via text message, is the primary and best way to reach your contractor talent pool due to its speed and perceived engagement level.
6. While there is often a focus on the technology involved in this process, recruiting remains essential to “pulling” an interested candidate through the hiring process.Related: Improve Talent Curatation with Direct Sourcing

Benefits of direct sourcing

Direct sourcing offers several benefits to organizations that choose to adopt it.

• Cost savings: An MSP provider leverages an organization’s data and employment brand, driving cost savings into the program. Some companies spend over $50-$100 million in contingent labor. Using an MSP to payroll those referred employees and having a reduced markup compared to their staffing suppliers results in significant savings.
• Accelerated cycle times: An engaged talent community of contingent workers allows for accelerated submittal and processing times, resulting in greater efficiency.
• Leveraged silver medalist candidates: Direct sourcing offers opportunities to monetize silver medalist candidates who expressed interest in a role but were not selected.
• Overall enhanced candidate experience: AI in direct sourcing helps drive efficiency and engagement through two-way text messaging that ensures instant communication with candidates.

Despite the confusion surrounding direct sourcing and its appropriate uses, its future is bright. By adopting data-capturing practices and monetizing such data with an investment in technology and AI, the utilization of direct sourcing in the workforce solutions industry will experience significant growth and success.

Watch the entire leadership forum broadcast here.

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Direct sourcing versus traditional staffing

Direct sourcing is a service line that fills the gap between Managed Service Programs (MSP) and Recruitment Process Outsourcing (RPO) programs. Direct sourcing varies from traditional staffing—where talent is sourced by multiple staffing suppliers—in three primary ways:

1. Leverages your employer brand: Your company’s brand is your reputation and how your culture and values are perceived. Direct sourcing uses your organization’s brand and employee value proposition (EVP) to attract candidates.
2. Proactive vs. reactive: Traditional staffing agencies do not begin sourcing, attracting, or engaging candidates until they receive a job requisition to fill an open position. Direct sourcing is more proactive in that hiring managers forecast future contingent labor needs and then utilize technology to source and pre-qualify workers before requisitions are received.
3. Curates a talent pool/community: Direct sourcing builds and curates a private talent pool for your organization that is vetted and active for specific locations, job functions, and/or titles. A strong talent curation process creates a solid foundation for a direct sourcing program.

Related: Webinar Recap: Enabling Total Talent Acquisition With Direct Sourcing

Related: The Top Reasons Direct Sourcing Programs Fail

What is talent curation?

If you look up the word curation in the dictionary, you will find that the definition centers around selecting, organizing, and bringing people and groups together. In direct sourcing, a talent curator(s)—typically a recruiter—finds and gathers prospective candidates into a talent community or pool and then continues to engage with them to keep their interest peeked until a position becomes open within the organization.

How is a talent pool curated?  

An organization’s talent pool is curated in two ways:

1. Artificial intelligence (AI) matching

Direct sourcing artificial intelligence (AI) technology platforms leverage a combination of candidate sources, including a company’s applicant tracking system (ATS), job boards, referral networks, LinkedIn, and social media. The AI technology creates vetted and active talent pools for specific job functions, titles, and/or geographic locations. To promote further optimization of this talent pool, talent curators organize the data and candidates based on experience, qualifications, and skills.

2. Accessing your organization’s candidate pool

• Alumni workers: An easy-to-access alternative talent source is the pool of your organization’s alumni employees—those workers who previously held positions at your company and ended their assignments in good standing. A talent curation team can build a proprietary database with specific populations of alumni workers, and candidates can be sourced from this pool before extending the search to the staffing supplier base.
• Silver medalists: Otherwise known as candidates that came in second in the interview process, silver medalists can also provide a viable talent source to leverage. Talent curators compile these resources into candidate pools that can be tapped into continually.

Benefits of talent curation

Talent curation benefits both the hiring company and the candidate. Because your organization has a pre-qualified candidate pool, talent curation provides value to the hiring process by filling a position as soon as it opens. Therefore your time to fill is reduced, and candidate quality is improved. Candidates benefit from a more highly personalized, consistent, and exceptional experience.

A study conducted by LiveHire—a leading global recruitment and direct sourcing platform—found that proactively curating and pooling candidates generates better results than traditional job advertising:

• 41% reduction in applications to process per hire
• 24% improvement in submittal-to-hire ratios
• 30% reduction in shortlisted candidates withdrawing per hire
• 31% reduction in time to submit

Accessing your organization’s candidate pool also offers lower markup rates relative to candidates sourced by staffing suppliers, providing cost savings.

Are you a right fit for a direct sourcing program?

Direct sourcing solutions provide an alternative way to ensure greater success in talent curation and pipelining. If you still have questions about direct sourcing and talent curation or are ready to talk about direct sourcing services for your business, contact us!

This blog was written by Broadleaf’s Vice President of Client Delivery Joseph O’Shea.

The post Improve Talent Curation with Direct Sourcing appeared first on Broadleaf Results.

What is direct sourcing?

In many sectors, like the tech industry, contingent workers now make up 40 to 50 percent of an organization’s workforce. Because of this, human resources, procurement, and C-suite leaders realize the importance contract, gig, and freelance workers play in their workforce and how integral they are to their business strategy and growth. By loosening the constraints of existing talent silos and thinking about it holistically, organizations gain the ability to make resourcing decisions based on the task at hand and align the right talent to meet their organizational needs–regardless of the resource type. Direct sourcing is the process by which an organization leverages its own candidate pool—former employees, retirees, and silver medalist applicants from its applicant tracking system (ATS)—to place as contingent or direct hire employees within its company.

Related: What is Direct Sourcing?

Related: [Webinar] Enabling Total Talent Acquisition with Direct Sourcing

Why do direct sourcing programs fail?

Like any new solution, obstacles can hinder the adoption of direct sourcing and cause it to fail. By avoiding these common pitfalls, companies can successfully utilize direct sourcing to improve candidate experiences, streamline the recruitment process, and diversify their non-traditional workforce.

1. Lack of executive sponsorship: An SIA survey found that 54 percent of respondents believe that the most important practice for direct sourcing success was that there be clear ownership and accountability of contingent direct sourcing within a company. Organizational change can be difficult and accompanied by pockets of internal resistance. To avoid wasting time and effort, the key to direct sourcing success is to have the right executive involved in the sales process who’s ready to fully adopt the solution and spearhead the change management process within his or her organization. “Buyer engagement is key to direct-sourcing success as you’ll need to dedicate time and energy to educate your program partners on your company’s brand, communication style, and values,” states Wen Stenger, CEO of Omni Inclusive. To prevent failure when implementing a direct sourcing program, designate an executive sponsor to ensure engagement, commitment, and support. This representative will help drive communications throughout the organization while participating, as needed, in resolving challenges.
2. Absence of contingent workforce program team buy-in: The contingent workforce program team within a company is responsible for keeping all aspects of the program—hiring manager engagement, fulfillment of requisitions, program reporting metrics, the vendor management system (VMS), supplier management—running smoothly. Without the support of this team, no hiring can occur. When an alternative sourcing channel—like direct sourcing—is added to the mix, this team is now required to manage the process differently. This paradigm shift requires that the talent community be checked first before releasing a requisition to staffing suppliers. Direct sourcing programs fail when the contingent workforce program team manages in the same way it manages traditional staffing agencies—providing a vendor-neutral playing field and making suppliers compete equally for requisitions. For a direct sourcing program to be successful, preference must be given to the direct sourcing channel by first checking the talent pool before releasing a job to traditional suppliers.
3. Failure to evaluate and invest in innovative technology: Direct sourcing artificial intelligence (AI) technology platforms can be used to leverage a combination of candidate sources—including a company’s ATS, job boards, LinkedIn, referral networks, and social media. Using AI platforms, talent communities are generated that are vetted and active for specific locations, job functions, and/or titles. Each direct sourcing technology platform has strengths and weaknesses. If you don’t spend the time evaluating each platform to determine which one best meets your company’s specific needs—while allowing you to accomplish more with fewer resources—the program is less likely to be successful.
4. Inadequate talent curation team: Once the candidate pool is curated using technology, talent curators organize the data and candidates based on classifications such as experience, qualifications, and skills to promote further optimization of this talent pool. The talent curation team is critical in making a direct sourcing program run and they must have a clear service design blueprint and fully understand their responsibilities. If this team is not adequately staffed with skilled sourcing and recruiting professionals, the direct sourcing program will not produce a high return on investment.
5. Neglecting to capitalize on brand sourcing: Direct sourcing is similar to brand sourcing and leveraging your organization’s brand name to attract, engage, and retain talent. 84 percent of job seekers believe the reputation of a company as an employer is important and 50 percent of candidates would not work for a company with a bad reputation. A direct sourcing program is set up to fail when your company’s brand is not fully leveraged and it’s treated more like a staffing agency solution than a direct sourcing solution.

There are significant benefits to working with a proven direct sourcing solutions provider. Not only can the right direct sourcing solution improve your slate of candidates and provide better access to diverse talent, but it can help accelerate your recruitment process and ensure a positive and consistent client and candidate experience. Outsourcing your talent needs—to a proven direct sourcing partner like Broadleaf—can assist you in focusing on what you do best—building your business.

The post The Top Reasons Direct Sourcing Programs Fail appeared first on Broadleaf Results.

What is direct sourcing?

With a proactive recruiting approach, direct sourcing builds employer-branded talent communities from which to hire. It is frequently called Recruitment Process Outsourcing (RPO) for the contingent workforce and is critical to a company’s total talent acquisition success.

• By accessing an organization’s own candidate pool—former workers, retirees, and silver medalist applicants from its applicant tracking software (ATS)—direct sourcing can be leveraged to place contingent or direct hire employees within a company.
• Direct sourcing artificial intelligence (AI) technology platforms, like LiveHire, can be used to leverage a combination of candidate sources—including a client’s ATS, job boards, LinkedIn, referral networks, and social media. Using AI platforms, talent communities are generated that are vetted and active for specific locations, job functions, and/or titles. Once the candidate pool is curated, workforce solutions program talent curators organize the data and candidates based on classifications such as experience, qualifications, and skills to promote further optimization of this talent pool.

In other words, direct sourcing is a service line that fills the gap between Managed Service Programs (MSP) and Recruitment Process Outsourcing (RPO) programs.

Related: What is Direct Sourcing?

Related: Direct Sourcing Services

Using direct sourcing to complement MSP and RPO programs

• To implement a direct sourcing program successfully and seamlessly, Broadleaf draws on its “stewardship experience” from RPO programs to leverage a client’s employer’s brand.
• The company’s experience in candidate outreach and attraction methods makes building a private database of qualified and interested candidates an easy transition.
• MSPs already pair technology with best practices for contingent staffing, so using talent pooling technology—like LiveHire—creates an efficient and targeted solution to hiring.

Benefits of direct sourcing

• Better access to talent: Direct sourcing reduces your organization’s submittal-to-fill ratios and ensures you have a continuous talent pool for key roles.

• Private talent pool: This feature of direct sourcing is an asset because candidates in this pool cannot be “touched” by other companies. This means that those in the pool have expressed interest in being considered for current or future positions with that company and are nurtured to ensure availability for the next open role. Additionally, the curation team managing this talent pool will not consider these specific candidates as placements at another company or competitor.
• An improved slate of candidates: Much of the direct sourcing talent pools are compiled of alumni, retirees, and “silver medalist candidates”—those who made it to the final round of the hiring process but were not hired. Silver medalist candidates are extremely valuable to a company’s recruitment strategy because these individuals have already been vetted as highly considerable for a position previously. In exchange, these individuals have already expressed sincere interest in working for the company and are familiar with the brand. The job market is consistently changing, and candidates that were not selected for one position may be perfect for another. It is hugely advantageous to begin with an already qualified and informed talent pool when in the hiring process.
• Streamlined process: With direct sourcing, all the recruitment “heavy lifting” is taken care of by technology and your curation partner. Analytics provided by companies like LiveHire supply job forecasting so organizations can implement direct sourcing into their hiring strategies and target the roles and locations where this practice will be the most effective. Ultimately, this reduces the time to hire.
• Positive and consistent candidate experience: AI matching ensures that sourced candidates are qualified and able to engage in work assignments quickly. Two-way messaging provides timely communication to deliver a positive candidate experience at every step of the recruitment process—resulting in higher conversion rates.
• Curated talent community: The use of AI helps drive efficiency and engagement without having to engage secondary staffing suppliers.
• Cost savings: By eliminating the need for several suppliers when looking for candidates, the suppliers that are utilized are strategic, and therefore, cost-effective. Companies can achieve maximum value from this practice by checking their own talent pool first to fulfill the desired position. If the talent is not there, then the company can turn to other third-party staffing agencies to help them acquire candidates. Ideally, the goal is to leverage your own full-time candidate population for contingent opportunities, build your employer brand, and achieve cost savings. Organizations will experience a reduced time to hire by tapping into an engaged opted-in talent community who are already interested in working for your company.

Direct sourcing and the hiring strategy funnel

The essential question to workforce strategy planning is “how can a company stand out to bring more candidates into their “hiring funnel?” A business must understand the need to fill the “top” of the funnel when hiring and attracting candidates and applicants. However, a business must see this funnel through in terms of placements and retention. Filling the talent shortage improves bottom line business initiatives and outcomes and, in turn, delivers client needs. Implementing a direct sourcing model allows a company to establish your contingent worker program so that it can sustain the journey. Direct sourcing strategies focus on filling the top of the funnel and continuing the flow without losing candidates or having candidates “fall out.” To keep filling this funnel, direct sourcing strategies must consider elements like talent compensation and management to stay ahead and retain talent.

“War for talent” solution

Amid today’s “Great Resignation,” the consensus among many is that the talent has won and it’s a candidate-driven market. The companies succeeding in this war are those that are thinking outside the box. Hiring in precedent, or “the way we have always done it,” is how companies fall behind. Organizations are now recognizing the necessity and the value of understanding and managing their “total talent.” Companies should find solid tools to help build your total talent acquisition strategy. Partnering with a total talent management solutions provider expands your talent community–by engaging the largest pool of potential candidates possible–and increases the probability of procuring higher-quality talent on a consistent hiring basis. Direct sourcing solutions provide an alternative way to ensure greater success in talent curation and pipelining.

The post Webinar Recap: Enabling Total Talent Acquisition With Direct Sourcing appeared first on Broadleaf Results.

What is total talent acquisition/management?

Total talent management (TTM) integrates direct hire employee (RPO) and contingent/temporary worker (MSP) talent solutions to create an all-encompassing approach to workforce management. By loosening the constraints of existing talent silos and thinking about it holistically, organizations gain the ability to make resourcing decisions based on the task at hand and align the right talent to meet their needs—regardless of the resource type. When asked to elaborate further, Jason said, “it’s a comprehensive approach to where job candidates are in the process of their employment journey and understanding what their needs are.” With the current economic conditions of inflation and recessionary headwinds, there’s been a shift around Managed Service Programs (MSP) and Recruitment Process Outsourcing (RPO) programs and designing contract labor and supplier strategies to meet clients’ needs through a flexible, holistic total talent management approach.

Embracing total talent management workforce strategies

Within an organization, workforce management is often siloed with contract labor managed by the procurement department and the HR or talent acquisition department responsible for full-time labor. Companies often use an Applicant Tracking System (ATS) for full-time hires and a Vendor Management System (VMS) for larger contingent labor programs, and these platforms are often not integrated.

When a Broadleaf client creates a job requisition—regardless of whether it was created in an ATS or VMS—our client delivery team asks the client questions to challenge their standard thought process and procedures. Would you consider a full-time hire in place of a contingent worker? Or a temp-to-perm worker in place of a direct hire? We have found that 25 to 27 percent of workers that start as temporary contractors are converted to full-time employees in 90 to 120 days. Jason stated, “regardless of whether a worker is a full-time employee, contract worker, or 1099, it’s important to bring the right skill set to the business to meet their needs.” He went on to say that creating a holistic approach to a client’s talent management is a building process and it takes time, credibility, and momentum to drive the change they are seeking.

Total talent management adoption and obstacles

To support a client in adopting a total talent management strategy, workforce management providers:

• Offer a suite of technologies with live data to assist the client in making intelligent decisions and create a positive candidate experience
• Help clients formulate a competitive compensation strategy. There’s been an increase in labor market intelligence tools leveraged to generate a greater understanding of regional hiring trends and market strategies.
• Create a strong value proposition of what TTM is and align it to the client’s business strategy and culture
• Leverage the support of executive sponsors to keep the client on track and ensure full utilization of a value-driven program
• Demonstrate the value of TTM through case studies

When asked for examples of client obstacles—that workforce management providers encounter—when adopting total talent management strategies, the panelists noted the following challenges:

• Siloed business functions—human resources, procurement, IT, and business leaders—that do not have the same understanding or knowledge
• Lack of investment in technology and tools
• Competing priorities within the organization
• Change of stakeholders that requires reeducation
• Fear of change that deters adoption inertia

Direct sourcing

Direct sourcing solutions provide an alternative way to ensure greater success in talent curation and pipelining. Direct sourcing is the process by which an organization leverages its own candidate pool—former employees, retirees, and silver medalist applicants from its own ATS—to place as contingent or direct hire employees within a company. When asked about out-of-the-box ways TTM providers assist their clients to overcome talent challenges, Jason spoke about direct sourcing as “a really unique way to address talent challenges with total workforce solutions to drive change.” He then shared a Broadleaf success story in which a manufacturing client experienced a large spike in retiring employees at the start of 2020. This created a skills knowledge gap between the high level of turnover and the number of new employees that were not yet fully trained. Broadleaf assisted the client to bridge their experience and productivity gap by direct sourcing from alumni pools and recent/new retiring tenured employees for temporary placement as contract workers.

Related: Enabling Total Talent Acquisition with Direct Sourcing

Navigating the current labor market

The talent shortage is at its highest level in 15 years and 68 percent of employers are challenged in finding the right workers to fill open positions. The candidate-driven labor market in which job seekers define when and how they want to work is not going away any time soon. Organizations must be creative in their talent acquisition approach and push the boundaries of their current strategies. A total talent workforce solution with direct sourcing can add flexibility to the hiring process with the procurement and talent acquisition departments working together to identify the best worker for each role regardless of the resource type. Organizations that are not flexible will lose the war for talent.

Partnering with a TTM solutions provider expands your talent community–by engaging the largest pool of potential candidates possible–and increases the probability of procuring higher-quality talent on a consistent hiring basis.

Related: Leveraging the Power of Total Talent Management with Broadleaf

To discover more about the RPOA and its membership opportunities, check out the organization’s website here.

View the full webinar here.

To learn more about Jason, connect with him on LinkedIn.

The post Total Talent Management: The Blending of Temporary Labor and Direct Hire Workforce Solutions appeared first on Broadleaf Results.

Join our Direct Sourcing webinar to learn how it’s helping companies face the current labor market head-on.

We will cover:

1. What is Direct Sourcing?
2. Benefits of Direct Sourcing
3. How Direct Sourcing fits into MSPs and RPOs
4. Implementing a Direct Sourcing solution
5. Enabling total talent acquisition

Speakers 

Karen Gonzalez, Executive Vice President, North America, LiveHire

Register today!

Learn about Broadleaf’s Direct Sourcing services.

For more information, read our blog, What Is Direct Sourcing?

About LiveHire

LiveHire is a globally-leading recruitment and contingent direct sourcing platform – enabling clients to attract and engage both permanent employees and contingent workers to deliver Total Talent and Direct Sourcing solutions. LiveHire offers an award-winning candidate experience and provides talent-on-demand through its unique talent pooling and 2-way text messaging functionality, having successfully enabled end-to-end recruitment from sourcing through to hire of diverse workforces for over 150 clients across 20 verticals globally. For more information, visit www.livehire.com.

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