Recruiting in 2.0 World
Recruiting is not the same anymore, atleast it should not be the same anymore but are you keeping up with the changing landscape. In a 2.0 world, sourcing possibilities increase exponentially.
Shooting for the Stars - Staffitnow Featured in MidwestBusiness.com
If you shoot for the stars and hit the moon, it's OK. But you have to shoot for something.
This is feature written on Staffitnow in the MidWestBusiness.com
CHICAGO -- If you’re a technology entrepreneur, you are shooting for something. But how can you tell if you’re shooting for the stars rather than, say, your own foot? For insight, let’s look at one Chicago-area company that aspires to become an interstellar rocket.
The company is StaffITnow. It was founded by Naveen Bala and Siva Ramamurthy in May, 2005, but the two have been working on their technology since 2002. They bill the company as the “eHarmony® for the job market�. If accurate, that’s a strong claim, because eHarmony itself certainly looks like a rocket.
In fact, eHarmony seems on the verge of joining online innovators like eBay and Google in transforming a fragmented and mostly latent market into a blockbuster that they dominate. It has become the must-use online dating service because of their “scientifically-designed compatibility matching system� that uses 29 factors to quickly narrow thousands of romantic possibilities to the best matches. The company claims credit for 90 marriages every day.
By comparing itself to eHarmony, StaffITnow is saying that it quickly narrows thousands of job and candidate possibilities to the best matches. Sounds important, but is it really shooting for the stars? Let’s peel the onion a bit to examine some similarities between eHarmony and StaffITnow.
First, consider some gross demographics. In the U.S., about 140 million people have been married, and about 150 million people are in the workforce. Not only are the magnitudes comparable, but they highlight that both eHarmony and StaffITnow are focused on improving two of life’s fundamental issues, usually a good foundation for a business.
Next, reflect on the problems you’ve had finding great dates and a wonderful spouse. Then reflect on the problems you’ve had finding a wonderful job or hiring great employees. It would be hard to say that one is more difficult than the other, and both activities are highly inefficient, time-consuming and painful. Again, a good foundation for a business.
Now consider the fragmented, low-tech, online “pinup� boards that have been the only services you could turn to for help in solving your dating or job problems. Both services rely on crude keyword matching, usually leaving you with almost no matches, out of date matches, or so many undifferentiated selections that you’re overwhelmed. Ineffective competition is another good business-building foundation.
In summary, both eHarmony and StaffITnow have huge potential customer bases with very painful problems that competitors cannot solve as well as breakthrough technology-based solutions that offer compelling customer value. Certainly sounds like great launching pads for an interstellar venture.
StaffITnow’s technology is an example of powerful find-the-needle-in-the-haystack search engines that intelligently filter, rank and prioritize limitless possibilities based on relevance to the searcher. It employs sophisticated technologies (e.g., natural language processing, artificial intelligence, pattern matching) that can read, understand and analyze job descriptions and resumes in any format, and do so quickly, easily and cheaply. Their service is being successfully used by about 50 pilot customers. Nice initial liftoff.
Interestingly, although their technology is a platform that can be used for the entire job market, StaffITnow’s founders wisely chose to launch their business at the information technology job niche, about which they know a lot from personal experience.
In fact, serving the job market for IT professionals alone will be a great business. There are about 3 million IT jobs in the U.S., and annual turnover, always notoriously high, has been estimated by one analyst at up to 20%, which would mean 600,000 job openings per year. Because so many jobs are open and because they typically have very specific technical specifications (which change constantly with the dynamics of information technology), it is very difficult to find good candidates.
In addition, finding good candidates is further complicated by highly fragmented and inefficient IT recruiting, which is conducted by recruiters from employing firms as well as from about 20,000 job agencies. One result is that a single job is often posted many times, and StaffITnow documents 18,000 IT job postings every single day (which it collects from several hundred sources). At prices prevailing on the pinup boards, IT jobs represents about a $1 billion market niche.
Not only is StaffITnow initially targeting a single job market segment, it will be focusing more specifically on its most attractive niche, recruiters who labor trying to fill a minimum of 50 IT job openings annually. It’s one thing to find one good match for life, it’s many magnitudes harder trying to find 50 good matches every year. So perhaps the better comparison is that StaffITnow is like eHarmony on steroids.
We have only touched on a couple elements of StaffITnow’s promising business model, so the company’s progress may merit revisits in future columns. For example, most of its technology has been developed by its India-based unit, which sits in the second largest IT job market in the world and will serve as the launching pad for StaffITnow’s first international market launch.
Stay tuned, earthlings.
Posted by Naveen Bala Posted at 11:53AM Mar 13, 2007 by Naveen Bala
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