Are All the Best Job Candidates "Passive" Candidates?

John Fortino

"It is my thought and our philosophy and has been since we started this business almost nine years ago now, you can’t ignore any candidate, whether it’s active, whether it’s passive and we found this at Motorola. We were able to identify some very high level candidates and fill positions at the senior levels, from resumes we found online. We’re talking big roles and people who are high producers for the organization. Just because someone has a resume posted online doesn’t mean they’re a bad candidate." — John Fortino

Welcome to an Inside Recruiting Channel podcast on TotalPicture Radio. with Peter Clayton reporting. Joining us today is the co-founder and senior managing partner of Velocity Resource Group -- John Fortino. Velocity is an industry leading resume sourcing, screening and qualification service, with sourcing operations in Naperville Illinois and Bangkok, Thailand. Velocity is one of TotalPicture Radio’s sponsors at SourceCon 2010.

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John Fortino SourceCon Interview Transcript

Welcome to an Inside Recruiting Channel Podcast on Total Picture Radio. This is Peter Clayton reporting. Joining us today is the cofounder and senior managing partner of Velocity Resource Group, John Fortino. Velocity is an industry leading resume sourcing, screening, and qualification service with sourcing operations in Naperville, Illinois and Bangkok, Thailand. Velocity is one of Total Picture Radio’s sponsors at SourceCon 2010 this year.

John, welcome to Total Picture Radio.

John Fortino: Thank you, Peter. Happy to be here.

Peter Clayton: You have a quite unusual story to tell about the strategic vision for your company. From day one, your partner David Simpson, has been based in Bangkok. Can you share with us the concept behind Velocity Resource Group?

John: Sure. Back in the late 90s, I met David Simpson. He and I were part of a team that helped build an internal executive search practice at Motorola, out of the corporate offices in Schaumburg, Illinois. In the course of the two years we worked together, David managed a number of our international searches that took him over to Asia and then to the European market as well.

While in Thailand managing a project, he spent some time there and recognized a couple of different things. First off, it’s 12 hours exactly different from Chicago and he was able to get quite a bit of work done while all of us were sleeping here in the US.

Secondly, the people that he worked with at Motorola in Thailand were extremely educated, dedicated individuals, and the cost of labor was considerably lower for the resources that he had to work with while over there. As he came back, he felt there’s a compelling opportunity there

The idea behind the name of Velocity – speed. The idea was to provide to our clients overnight resume sourcing services, identifying resumes from the internet – whether it’s paid job boards or Google or whatever may be – identifying them and delivering them to our clients overnight. It was our thought that hey, why don’t we identify clients and provide them with those resumes before their competition gets them. That was the concept behind the business.

It has evolved dramatically since we started the business. We now provide the overnight resume sourcing. We provide qualification services – all of the qualification services take place out of Chicago – and delivering, in a very short period of time, a very impactful service, which sources, screens, qualifies resumes and turns resumes into candidates quickly for our clients at a low cost in a very compressed timeframe.

Peter: A few days ago, John walked me through the technology platform used internally by Velocity’s clients in sourcing qualified candidates for their open positions. John, can you draw us a picture here on the radio, walk us through a typical search assignment your company conducts?

John: Sure. We work with a variety of different clients and a number of different industries across the internal skill sets – so HRIT from low level positions up to vice president level. But what happens is a company when they have a need, one of our clients – they’ll contact us and say, “Hey we have an opportunity, we need some help filling the position.” We take the specific requirements for that role. Our team overnight sources resumes, identifies resumes from the - we call them “active candidates.” We source the major job boards and a few niche boards as well to identify resumes, which match up with that skill set.

Our process takes three days of sourcing. We provide our clients opportunities for calibration. So after the first night, while our clients are sleeping, we’re sourcing. The next morning, our clients come into their office, they have an email, they log into our portal, and they can access and look at the resumes identified. From that point, we sit down with them and work through the different resumes to determine what’s a fit, what’s not a fit, and basically what we call a “calibration call” to really make sure we hammer in what we’re really looking for, what the client really likes what they see; we take that information and continue our sourcing efforts for an additional two days.

At that point, our team here in Chicago begins the qualification process. The qualification process is based off what we call linear – it’s non-assessment, but it’s just gathering information. So we’re asking and gathering information about salary requirements, about relocation, specific questions about years of experience, certifications, education, and just basically identifying that the candidate is qualified, available, and interested in opportunity - take that information and deliver it to our clients in a real time basis. Throughout the day, as we’re calling these candidates and identifying them as interested, our clients are seeing that within our system.

We have another component to our business where we not only do we source resumes, but as our clients post their positions to different jobs boards or internet sites or media – could be even print these days, it’s very rare – but wherever they may post it, as resumes come in for many of our clients, we take those inbound resumes, review them, screen out the resumes which are not a fit, but then move the ones that are forward through, qualify them, and process that data as well.

More importantly for that line of service, not only do we do the actual work, we open up every resume, qualify the resume, but we also provide back to our clients analytics about where the resumes are coming from, what is a fit, basically the analytics of how many resumes received per site, the number of resumes qualified per source and delivering that data to our clients in real time.

Peter: There’s a considerable amount of human intervention that exists here in spidering through these resumes. This isn’t all a software thing that’s going on over there in Bangkok.

John: Not at all. We do utilize some technology, but the majority of the work activity is, both David and I believed from day one of our business, that recruitment, although there’s some great technology to assist, ultimately there needs to be a human eyeball on a resume. There has to be a human picking up the phone and making a phone call.

Our philosophy into our business in a discipline process – so from the sourcing aspect, our team in Thailand, all of our analysts who are doing the sourcing the activity, highly educated, Master’s degreed, multilingual – they sit down, log into Monster and run a Boolean search string in identifying resumes, log in to the next job board, log into the next job board and massage the search. There’s some art along with the science of identifying candidates. All of these people have been trained through our process of sourcing and interesting to note, one of the biggest advantages that Velocity has in the marketplace is the fact that one of the founding members is onsite managing our offshore facility. Without a doubt, that impacts our deliverables to our clients dramatically.

It’s really people doing the work and we have a team of people here in Chicago that are consistently on the phone calling and qualifying. So although we do send out emails and leverage our own technology to help the process, eliminate waste, and really develop our systems to support a very disciplined process and deliverables that are very consistent to our client, it relies on people. I think that’s the big differentiator between maybe a Velocity service and some of the technologies out there today.

Peter: One of the things that jobseekers who are listening to this podcast need to understand is how the job boards operate and make money. A lot of people outside of the recruiting industry assume it’s through job postings, but the job boards in reality are very, very large databases and you have job listings on one side and resumes on the other side and a great deal of the job boards income is derived from selling access to their resumes databases, am I right, John?

John: Yeah, that’s exactly right and that access to the resume databases – what we’re finding has never been a better value proposition than it is today. As candidates or individuals throughout the last year and a half, is the unemployment has skyrocketed, individuals who are not employed have been posting their resumes and we’re talking about highly qualified candidates – individuals who for no fault of their own, caught up in downsizing or whatever, find themselves out of a job. Where do they turn? They post to the major boards, to some of the niche boards, but the volume, the quality has never been better for individuals sourcing those job boards.

So tremendous value proposition for our business for companies who buy access for those. I think the bigger challenge though is are they utilizing their resources, the companies and the recruiters within those companies, do they have the time to effectively source those job boards in a disciplined manner pulling out that data effectively? That’s our value proposition back to the marketplace.

We go into those boards, we find those resumes, and it’s not just one – we call it cherry picking, right? We don’t cherry pick the boards, we go in and have a very disciplined process of manipulating search strings, identifying different pieces of a resume, use that as our next search string, and it’s a very complicated process to really extract those qualified resumes that may be hidden in different corners of those databases.

We pull those out because we have the time to do it. We have a small army of people managing that activity and delivering that to our clients. So the job boards, the databases – phenomenal resource for recruiters, phenomenal resource in value proposition for our service.

Peter: A lot of recruiters have told me that the best, the most qualified, the most desirable candidate for any job is a passive candidate, meaning someone who is currently employed. What’s your take on this?

John: I would respectfully argue with that. In certain cases, potentially the answer would be yes. It is my thought and our philosophy and has been since we started this business almost nine years ago now, you can’t ignore any candidate, whether it’s active, whether it’s passive and we found this at Motorola. We were able to identify some very high level of candidates and fill positions at the senior levels of resumes we found online, and we’re talking big roles and people who are high producers for the organization. Just because someone has a resume posted online doesn’t mean they’re a bad candidate.

The reality is, and we always come back to this position, that it is the fastest, least expensive way to identify candidates in the recruitment process, sourcing process. It cannot be ignored. We’re talking about 50 million resumes posted out on the internet, whatever the number is, you can’t ignore that and those who do ignore it and focus primarily on the passive, that sucks up enormous amounts of time and creates enormous cost to an organization, if that’s all they were doing.

So we feel that there’s a very nice blend. Do we think that the active candidates is the only way to fill a job? Absolutely not, but it is, in our opinion, the first place to go. Why not? We have seen throughout the course of our almost nine years in business, the research and the information we pull down, candidates who we identify from the internet ranging from retail salesclerks up through vice president levels and clients have hired candidates through our service over $300,000 annual salary – found from the internet.

Peter: Really?

John: Oh yes.

Peter: You would assume, especially in doing like the kind of services that you provide, that you’re basically out there sourcing entry level or high churn retail jobs, but you’re telling me you get assignments to go out and find very senior level people?

John: That’s part of it, yes, but it’s across the board. It’s from industry. We work in the pharma, biotech, technology, aerospace, manufacturing industries. I don’t think there’s an issue we haven’t touched – healthcare, from the levels, from vice president down to shipping and receiving clerks.

More importantly, however, when you look at when they turn to Velocity, they’re probably giving us some tough jobs - positions where they’re having trouble identifying candidates, and so those typically are positions which are either highly technical, very high demand for those candidates. So they turn to us to help them find candidates for those roles.

It ranges from some highly, highly technical – for aerospace companies, senior collision avoidance radar architects, to highly technical and scientific roles for biotech and pharmaceutical companies. It doesn’t really matter to us; our search process or sourcing process remains virtually the same. What changes is the search strings and what we approach, how we tie those search strings together to find those candidates, but they’re out there and we’ve demonstrated that time and time again to our clients. There are some great candidates in the marketplace that are posted to the boards that are highly qualified and that can do their jobs and for less than $2000 at a pop, they see tremendous value in that activity.

Peter: Here’s something I’d like you to address. It’s no secret that job boards have gone through a brutal last couple of years, thanks to the recession. Even though they’re getting tons of resumes, they’re not getting tons of jobs. We’re continuing to see consolidation most recently with Monster’s acquisition of HotJobs. What’s your assessment of the job board industry? Is it healthy, is it going to survive?

John: I think it certainly is going to survive. It’s going to change. In our industry, there’s a lot of buzz around social networking. There’s a lot of buzz about new technologies consistently. Again, I’ll go back over the course of the last nine years; we’ve consistently focused on just the active candidates who are posted to job boards and have delivered successful search services to our clients, sourcing candidates off the boards. I don’t see that going away.

When a candidate is looking for a job, what’s one of the first places they go? They’ll go to a Monster or an Indeed… something along those lines to post a resume or find a posting. It works.

If you think back, back in the early 90s, recruitment was one of the first real business applications of the internet. As the internet became popular, Monster was an early adaptor of this type of service or business deliverable to the marketplace. It’s still valuable and it’s still works. Although it’s not as sexy as Facebook or LinkedIn, it works, and there’s still enormous amounts of data on those boards. There’s still a value proposition for companies to post on those boards. I think it’s going to change however, and I think where they move and in what direction, I can’t say I’m an expert in that space but I think they have a lot of legs left. I mean I think it’s going to be a long time before we see them totally gone from the marketplace.

Peter: To your point about the explosion of the social networks, the LinkedIns, the Facebooks, and the Twitter out there. I mean LinkedIn is virtually becoming a resume posting service. You look at how people are now constructing their profiles or constructing their profiles the way you would construct a resume.

John: That’s right, and it’s a fantastic tool. It works. Enormous amounts of people are putting their data on there. It’s a great networking site. You talk about social networking sites, I’d call this more of a professional networking site, but that certainly is what I would consider the industry lead in recruitment for social networking types of services handed down a phenomenal tool for recruiters.

We use LinkedIn for sure. We have not found the value proposition in applying our services to the Facebooks or MySpaces from a recruitment or sourcing standpoint, although I think it’s a great place for branding and that sort of thing.

From a hardcore sourcing perspective, we just haven’t found it to be as valuable and quite frankly, even LinkedIn. Now although LinkedIn is a great tool, it’s a great way to identify unbelievable talent who may not be posted on the internet. The challenge with LinkedIn, it requires a whole another set of skills to attract, pitch, sell, and bring those “passive” candidates into the fold.

So when we look at what we’re delivering for our clients, our focus has always been on the active candidates because as an example, our contact ratio of individuals who have posted their resumes is over 75 percent. Meaning if we find 100 resumes for a job, we’ll call through those individuals and talk to or communicate to 75 percent of those candidates on average. When we turn to LinkedIn, that number drops dramatically. We’re pushing 25-30 percent contact ratio. Those are passive candidates for the most part, they may not have interest in talking to you about an opportunity. It takes more time and effort to recruit those candidates. So it’s our philosophy and our business model for us to support our clients with the active candidates, high volume, a lot of work activity, do that for them so the recruiters in the marketplace or at the companies can focus on that high value work activity. That high value work activity is working those passive candidates because those are great candidates, you can’t ignore them - utilizing their skills to attract, to pitch, to sell the candidates on an opportunity within their company.

Peter: Well that’s the real value proposition of a recruiter, is it not…

John: Oh absolutely.

Peter: … is being able to attract that passive candidate and getting them to take a look at another opportunity that exists out there.

John: That’s exactly how we feel, but what happens in today’s environment in the corporate world is that recruiters are bogged down in the weeds of the low value, yet highly critical, high volume work activity of sourcing, of reading the resumes coming in from postings, doing all the low level work activity, which is critical to sourcing, critical to the recruitment process, yet bogs them down and keeps them from providing high value work activity back to their company, to their internal customer.

So working with their hiring managers to understand their business needs and understand specifically the role that they’re recruiting for, working with the candidates and delivering or being able to spend more time assessing the slate of candidates as opposed to rushing through that because they don’t have the time to do it.

Our goal and our service is to help them manage that high value work activity so they can do a better job, they’re more valuable to their company that they’re working for. They’re delivering a higher level of service, more consultative in their approach to their job as opposed to tactical flipping resumes.

Peter: What you’ve been talking about here for the last couple of minutes is really right off of the SourceCon Conference homepage and that is, is sourcing different than recruiting? We think so and obviously you do.

John: Absolutely. They’re two separate things, however, the interesting thing is there’s a relationship between the two that is critical and without one, you can have the best sources in the world, finding the best resumes, but if you don’t have the recruiting support or the people to take that data and move it through the process and sell the candidates and work with the hiring managers and assess the candidates, it goes nowhere. Likewise, if you have great recruiters, but nothing coming in the pipeline for them to recruit, it falls down.

The relationship between sourcing and recruiting is tight, is necessary, is anything in the corporate world today. They rely on each other, you need effectiveness in both sides, to be an effective recruitment or talent acquisition organization. That’s what we try to help our clients, I mean, help them do a better job on that.

Peter: What are some of the things you are hoping to take away from SourceCon?

John: A great Shally Steckerl t-shirt.

Peter: (Laughs)

John: For us, there is a lot of new technologies that come out annually. It gives us an opportunity to see what’s out in the marketplace because as I said before, Peter, we do employ technology. We do employ many of the different types of strategies that SourceCon promotes, although they’re focused primarily more along lines of the passive research and candidates. We can utilize those skill sets and those types of – we find a lot of different tips and techniques in identifying candidates out on the internet we can apply to the job boards. And so just always trying to stand the cutting edge of technique, technology, what we can do to improve our services to our clients and we’re hoping to really identify some of those this year at SourceCon.

We think as the economy turns around, there’s a lot more buzz back. I think in our industry, I think things are coming back a little bit and we’re excited to be there.

Peter: Is there anything that I haven’t asked you in this interview that you would like to share with the audience?

John: I think this has been pretty comprehensive, Peter. I think it goes back to the whole concept of one of the things we’ve been fighting an uphill battle of the last nine years or so has been the industry perception that active candidates aren’t that great a candidate; that the passive candidate is the only thing out there. We have data piled upon data to show our clients hiring people that are from the active candidate job boards across the different levels and if you’re looking, especially in today’s environment, when budgets are tight, resources are very thin right now, even in the smallest of an uptick in need of hiring, where do you turn? What do you do?

Well, over the course of these nine years of being in business, we’ve been that company that’s right there for you on demand, can help support companies when it comes to flipping the switch on, you need us, turn it off when you don’t.

The one thing we want to share with your audience is it works. Active candidates are a great source, especially in today’s environment with the internet overflowing of great candidates out in the marketplace.

Peter: Thanks so much for speaking with us today on Total Picture Radio.

John: Peter, thank you. I look forward to seeing you in San Diego.

Peter: Thank you.

We’ve been speaking with John Fortino, cofounder and senior managing partner of Velocity Resource Group. We’d love to hear your thoughts and opinions on our podcast today. Visit John’s feature page in the Inside Recruiting Channel of Total Picture Radio, that’s Total Picture.com, to voice your opinion.

This is Peter Clayton reporting. Thank you for tuning in to TotalPicture Radio, the voice of career and leadership acceleration.

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