Archive for May, 2011

Cost or Opportunity Cost?

May 23, 2011

On both sides of the hiring fence — hiring companies and candidates, there is no escaping the need to set yourself up for success.  Yet, as it pertains to the hiring process, how do you define success?  For candidates, it would appear obvious that success is marked by landing a job.  Similarly for hiring managers, success comes with filling an open position.  But we need to dig a little deeper.

Let’s say that as an unemployed, underemployed, or underpaid candidate, you have nothing to wear to an interview.  On what basis will you decide which clothes to wear and how you will obtain them?  Hypothetically, here are some possible options:

1.  Although you’re not a clothing designer or a tailor, you decide that cost is the ultimate factor and you buy the raw fabric yourself, trying to stitch together a home made suit.

2.  You’re not going to make your own suit, but cost is still the prevailing factor, so you go to your local Goodwill or Salvation Army thrift store and buy an out-of-style ‘70s polyester suit (if you’re a guy) or an ‘80s suit with the shoulder pads (if you’re a woman).

3.  Your highest priority is to appear professional and sharp with clothes that are flattering, so you invest in a new suit and have it tailored.

Could you still land a job if you opted for the first or second option?  Probably…eventually.  But it may take many months longer and along the way, you will likely have lost out on more optimal positions than the one in which you were ultimately hired.  So you spent next to nothing on the clothes, but you spent tens, if not hundreds of times the cost of a new tailored suit by enduring many additional months of not moving your career ahead.

Amazingly, I come across many highly intelligent and capable candidates every day who stack the deck against themselves, all in the name of saving money in the short term.  No, I’m not referring to their clothing, but rather their resume.

Many candidates, including MBAs and executive level individuals, simply don’t have the competency to build and present their own brand.  This alone is not the crux of the problem.  Rather, it’s the people in this large group who don’t tap into their own self-awareness long enough to realize that resume writing and brand building is not their forte.  Worse yet, there’s another subset who don’t seem to value the importance of hiring a professional to develop a well-crafted resume that bolsters brand equity.  Going back to the clothing analogy, these are the folks who would choose options 1 or 2 above, all in the name of saving a buck in the short term.

Hiring companies are not impervious to this myopic mindset either.  Many would rather rely on their highly esteemed, yet limited network to find candidates.  It doesn’t take long for that well to run dry.  Besides, this is not a scalable hiring strategy.  Next, they resort to reactive recruitment by listing postings on job boards because it’s cheap and seemingly easy.  Several months and hundreds of unqualified inbound resumes later, they’re back to square one.  Once again, this has cost significant wasted time, effort, and burden.

Generally, companies outsource payroll, benefits, telecom, and PR.  You’d think that for recruiting human capital – a company’s number-one asset in terms of both cost and value, they would seek out professional services as well.  Talent acquisition is only getting tougher and more competitive.  For a company to meet its hiring objectives, which in turn will better enable it to achieve sustained growth, spending money on a quality tailored suit (i.e., a professional, proactive recruitment resource and strategy) is tantamount to success.

These depictions of candidates and hiring companies are not exaggerated.  They are happening every day all around us.  This is worse than “penny wise, pound foolish.”  It’s really “penny foolish, pound foolish.”  Advancing one’s career and building one’s team are major life and business issues that deserve a committal of prioritization, budget, and trusted professional resources.  Spending wisely does not mean avoiding costs.  Instead, spending wisely should equate to doing all you can to avoid opportunity cost.

Action items:

1.  Of course, we’re all watching every dollar like never before.  But whether you’re a candidate or hiring executive, please don’t short change yourself.  This is too big a deal not to stack the deck in your favor.

2.  Just as you serve your business community with your subject matter expertise, invest in trusted advisors for effective interviewing and hiring.

3.  Whether it’s a poorly crafted resume or an ineffective job posting, both will cheapen your brand and cost you plenty over the long haul.  Buy the nice tailored suit!