A survival guide in Talent Technology 2023

It has been a busy week with 51 Search. I have been speaking with a number of sales leaders in the talent space who are looking at new opportunities. It is an interesting time in the market, with quite a lot of M&A activity, and a changing landscape of who is doing what, particularly in talent attraction. Since I have been asked a lot recently about how to navigate todays market, I wanted to take the opportunity to share a few thoughts about the direction we are headed, and how to deal with a turbulent talent market.

?Customer buying seems to be shifting from longer term contracts, to transactional buying on a campaign basis. My feeling is this is going to be the pattern for at least another 18 months. We are seeing a lot of stop start hiring, with a focus on filling roles quickly when they are open. Getting hiring right is more critical than any time I can remember. People are looking for new solutions to their challenges, because keeping doing the same old thing is not returning results.

All of the rules in recruiting that would normally apply in recession type conditions have been turned on their head. Whilst we would expect to see lots of candidates in the market, and the power scales tipped in the favour of hiring organisations, that's not really happening. Most developed economies (with the exception of France), are operating on close to zero unemployment, with less people than we have known, active in the labour market. Companies are rethinking their hiring strategy with a focus on campaigns, job by job. This has meant a new look at attraction strategy.

I have been having conversations with a lot of talent tech companies who are having to rethink their positioning and pricing to respond to a market that is switching to transactional buying. The net result has seen average spend per customer declining month by month, meaning that tech companies are having to win double the number of customers to remain in the same place.

Further complications I'm seeing is the turnover of senior people in talent acquisition roles. We are seeing hiring teams now operating on about half the headcount of a few years ago, with the cuts coming from seasoned recruiters and leaders. This has had a major impact on the sales pipeline, as decision makers have changed, pushing expected deals back to square one. I think now is a good time for all TA tech companies to completely review their pipeline, prospect by prospect. Modern sales folk need to be talking to multiple stakeholders across the organisation at any one time to mitigate this risk?

?There is definitely a need to at least double the leads going into the top of the funnel, to keep pace with the changing face of the market ,but another factor in this is the tendency to cut marketing budgets and headcount. This will erode the supply of leads into the top of the funnel which will bite further down the line. I understand that this will cut overheads, which might provide a short term balancing of the books, but don't do this without having a clear plan for new methods of lead generation.

?The advent of ChatGPT and other generative AI certainly provides some possibilities here, but it is going to take time to learn, bed in and track for ROI. I am seeing some progress in this area, combining sales and marketing, with more responsibility for sales teams to generate their own leads to make up the shortfall. Consider what investment this will need to generate the results needed. Remember, you are probably going to need to double the number of leads and demos to get the same return, before we even start thinking about growth. Customers want short term solutions that deliver results quickly, over long term commitments through contract. This is why lead times on sales are getting longer and longer. You need to be thinking about how you can deliver campaigns for hiring now. Keep winning campaigns and the contracts will come later when future hiring becomes clearer. (Many organisations I talk to now are currently hiring around 40% of what they forecast this time last year.)

One positive sign I am seeing across the market is talent tech companies getting much better at partnerships and working within the talent technology ecosystem. Whilst this has been evolving in other areas of tech for the last decade or so, the talent tech industry has been slow to the party. It does require a new mindset, and plenty of transparency. You need to ditch the thinking that everyone chasing talent dollars, pounds or euros is competition, and consider how you can collaborate, particularly around sales and the all important marketing and brand awareness. Whilst many of these efforts look like old school sales partnerships, we are not going to see the required evolution. It is about much more than introductions to pitch and paying out percentages. You will need to rethink your product offering, positioning and how you can be valuable to partners around educating users and shared prospects about hiring in today's market.

You are going to have to open yourself up to sharing concepts and becoming really useful members of the talent community. At the centre of the ecosystem in hiring is the ATS.? I know from the work we have been doing at Vonq (I sit on the board as strategic advisor), that this is a combination of tech and sales, that goes beyond sitting in the marketplace. It is part tech play, with integration going well beyond one sided plumbing, and providing genuine value to users, The ATS’s want to feature strongly in talent attraction both financially (new commercial thinking), in sharing data, to build effective recommendations, and being a single source for hiring.?

Hiring sales people now, I'm looking for a mix of hybrid skills that includes marketing and lead generation, personal branding, partnering and collaboration as well as the desire to be useful to the market, whilst remembering to close deals.?

Whilst it is undoubtedly tough out there, it's also an exciting new world to explore and conquer requiring some new thought and direction.

If anyone wants to talk to me about some of the sales people i’m talking to now, (and how they fit in this brave new world), or anything to do with the talent tech market, drop me a message and I will be glad to talk. Love to know your thoughts.

Bill out …. (Written old school without the assistance of ChatGPT.)