Recruiting OnlineA Guide for Decision Makers

RESEARCH

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Introduction

• This guide is intended to provide employers with an overview of online recruitmentand how it can be utilised to attract top talent effectively and efficiently.

• The guide is aimed at senior decision makers, including top management of companies and those involved in setting and executing talent acquisition strategy.

• The data, insights and opinions presented in this guide are based primarily on the Middle East market and may not be fully applicable in other countries or regions.

• This guide has been compiled by GulfTalent, the leading provider of online recruitment services in the Middle East.

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Contents

• Online Recruitment Cost-Benefit Analysis…….................….. 3

• Developing an Online Recruitment Strategy………………….. 8

• Appendix – Analysis of Middle East Online Candidates…….. 16

• Glossary……………………………………………….…………. 23

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Online Recruitment Cost-Benefit Analysis

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The Internet provides an ideal channel for employer branding, candidate sourcing and efficient screening

Uses of Online Recruitment

Employer Branding

Candidate Sourcing

Screening & Selection

• Promote the company as an employer of choice

• Gather market intelligence that shapes recruitment strategy

• Receive applications from active candidates

• Headhunt passive candidates through targeted database search

• Automate screening and filtering of applicant CVs

• Organise the logistics and administration of the recruitment process

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Online recruitment has proved an effective substitute for newspapers as the primary channel for sourcing candidates

Overview of Recruitment Process

Newspaper

Recruitment AgencyCandidatesEmployer

Online RecruitmentPortal

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Online Recruitment

NewspaperAdvertising

Recruitment Channels – Performance Comparison

Recruitment Agency

ExecutiveSearch

• Locally-based candidates

• International candidates

• Active candidates

• Passive candidates

3-30 days1-10 days 30-60 days5-15 days **

• Sourcing candidates

• CV Filtering

• Interviewing

Geographic Reach

Type ofCandidates

ServiceCoverage

Speed • Average time *

Online recruitment compares favourably with other channels in terms of reach, effectiveness and speed of getting results

Job posting /CV search

Advertising /Classified

Contingency recruitment

RetainedsearchProduct • Product name

* Defined as the total duration from the time a vacancy is sent to the HR team, until the HR team can provide matching CVs sourced from the supplier. ** Includes lead time required for an ad going into print, time to receive CVs and screening time

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Internal Cost Per Hire **Typical Supplier Fee per Hire *

Recruitment Channels – Cost Comparison(US$)

Recruiting online is by far the most cost-effective method, with total cost per hire as much as 90% lower than traditional channels

OnlineRecruitment

NewspaperAdvertising

RecruitmentAgency

ExecutiveSearch

$9,000 – 12,000

$100 – 300

$200 – 500

$12,000 – 21,000

$1,000 – 2,000

$1,500 – 3,000

$2,000 – 4,000

$1,000 – 2,000

$10,000 – 14,000

$1,600 – 3,300

$2,200 – 4,500

$13,000 – 23,000

Total CostPer Hire †Supplier Fee Structure

• Fixed fee, regardless of number of hires

• Payable upfront

• Fixed fee for advertising, regardless of number of hires

• Payable upfront

• 15-20% of annual salary per candidate hired

• Payable upon successful hire

• 20-35% of annual salary per candidate hired

• Payable 1/3 upfront, 1/3 on short-list, 1/3 on hiring

Source: Interviews with HR managers, supplier terms, GulfTalent analysis* Estimated based on hiring a mid-level candidate with a compensation of US$ 5,000 per month** Includes time of HR team, travel expenses of HR team and/or candidates, assessments and other associated costs† Total cost per hire = Supplier fee per hire + Internal cost per hire

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Developing an Online Recruitment Strategy

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3 Which Products?

Which online recruitment

products are most

suitable for my needs?

To maximise the benefits of online recruitment, companies need to address four key questions

1 Which Vacancies?

Which of my vacancies

are best filled through

online recruitment?

4 What Organisational Model?

How should my HR team and process be

set up to use online recruitment effectively?

2 Which Suppliers?

Which online recruitment sites are

most appropriate for my needs?

Key Elements of an Online Recruitment Strategy

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Professional /Managerial

Effectiveness of Online Screening

Candidate Presence Online

Entry level /Very Junior

Manual /Unskilled

High presence online High presence online Limited online presence

Can be efficiently screened using online tools

Hard to screen online, as core skills not in CV

CV insufficient for screening, or no CV at all

Ideal for sourcing and screening online

Can be sourced online, but screening may still be time-consuming

Unsuitable for recruiting online

Overall Fit For Recruiting Online

Segmentation of Vacancies

Vacancies suitable for recruiting online should be distinguishedfrom others

Examples

• Finance• HR• Marketing• Engineering• General Management

• Shop Assistant• Receptionist• Fresh graduate

• Labourer• Driver• Maid

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Key Metrics Method of Evaluation

• Request references from peers in other firms

• Review brochure and official statistics of the recruitment portal

• Request a free live demonstration of the site

• Purchase a short-term subscription to try out the service

• Monitor number of interviews and hires over a period of subscription

Candidate Quality

The appropriate online recruitment sites can be selected based on objective criteria

Supplier Selection – Metrics for Evaluating Online Recruitment Sites

Customer Service

• Quality of CV presentation

• Calibre of candidates

• Responsiveness and professionalism

• Familiarity with the online products

Online Tools• Quality of search and filtering tools

• Simplicity and user-friendliness

• Breakdown of candidate database(by location, industry, etc.)

• Size and freshness of CV database

Candidate Availability

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While most employers use both job posting and CV search, it is important to understand the benefits and limitations of each product

Days(should wait for candidates to apply)

Only Active candidates(cannot reach those who do not apply)

Candidates very likely to accept (they show interest first)

Need a full job description to start Only need job title and/or key skills(no need for a full job description)

Candidates may or may not accept(need to be persuaded)

Both Active and Passive candidates(some of the best candidates are passive)

Minutes(proactively target desired candidates)

Comparison of Online Recruitment Products

Time to GetGood CVs

Candidate Types Reachable

Likelihood of Offer Acceptance

Input ParametersRequired

Job Posting CV Database Search

Ability to draft attractive job ads, filter and screen CVs

Ability to do structured online search, and to approach candidates persuasively

Key HR SkillsRequired

Visibility and Branding

Recruitment is publicly visible(ideal for building an employer brand)

No public visibility or branding(can be good for confidential vacancies)

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Most firms operate a ‘centralised’ organisation for using online recruitment, giving access to the HR team only

Organisational Model – Centralised

Online RecruitmentPortal

HR Team Line Manager

• Line managers communicate recruitment needs to the HR team

• HR team source and screen CVs online, and forward to line managers for review

• HR team follow up with approved candidates to arrange interviews

• Line managers do not have direct access to the site

• Common setup in the majority of companies

Key Features

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It is possible to adopt a ‘distributed’ model, giving access to the line managers as well

Organisational Model – Distributed

Online RecruitmentPortal

HR Team Line Manager

• Both the HR team and line managers have direct access to the site

• Line managers identify desired CVs directly and mark them for further follow-up by the HR team

• Access permissions to the site are controlled by the HR team – e.g. who can post jobs, search CV database or view CVs online

• Used in a minority of firms, but adoption increasing

Key Features

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The choice of organisational model depends on the needs, priorities and resources of the company

Central HR team can develop expertise in online recruitment

Fully controlled access and compliance with standard procedures

The default setup in most companies; consistent with pre-Internet boundaries

HR team needs to expand in line with the growth of recruitment needs

Easy to scale up; a small HR team can support a large organisation

Unpopular with some line managers. Can be offered on a voluntary opt-in basis

Enforcing HR standards and procedures in dealing with candidates needs more effort and education

Fragmented use may not allow deep online recruitment expertise to be accumulated

Comparison of Organisational Models for Recruiting Online

KnowledgeBuilding

Control & Standardisation

StakeholderAdoption

Scalability

Centralised Distributed

Recruitment requires several exchanges between HR and line managers

Less communication overhead; line managers search and identify their target CVs directly

ProcessEfficiency

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Appendix – Analysis of Middle East Online Candidates

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Many myths and misconceptions exist about online candidates

“ Online candidates are mostly students and young people ”

“ Only technical candidates can be found online ” • Online candidates span all industries and functions,

with only 31% coming from IT and engineering roles

• Half of the online candidates are aged over 30, and 37% hold managerial positions, including 8% who are in top management

Common Myths about Middle East Online Candidates

“ Arabic speakers, especially Gulf nationals, do not look for jobs online ” • Over 35% of online candidates are fluent Arabic

speakers, including 8% who are Gulf nationals

“ Fewer people go online, compared to those who read newspapers ”

• The number of Internet users in the region is much higher than the total newspaper print circulation

“ Job ads on a recruitment website do not get as much exposure as print ads in national newspapers ”

• An online job ad typically receives over 400 applications, compared with around 200 for a print ad in a popular newspaper

Myths Reality *

* Based on GulfTalent’s database and analysis of publicly available data

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10%

13%

18%

23%

35%

35%

40%

43%

49%UAE

Qatar

Lebanon

Bahrain

Kuwait

Saudi Arabia

Jordan

Egypt

Oman 9%

6%

5%

8%

27%

17%

10%

15%

18%

Internet penetration has reached critical mass and now far exceeds newspaper print circulation across the region

* Number of Internet users as a percentage of total population. Based on 2007, the most recent year for which data is available** Sum of print circulation of all daily newspapers as a percentage of total population. Based on claimed (unaudited) circulation figures for 2008

Online vs. Print

Total Population (millions, 2008 est.)

24.9

5.6

4.0

6.1

3.6

1.4

2.8

1.1

77.1

Internet Penetration * Newspaper Circulation **

Sources: ITU, The World Factbook, Internet World Stats, Middle East Media Guide, Economist Intelligence Unit, GulfTalent Analysis

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55%

10% 35%12%

88%

Candidates found online have a higher level of education and better language skills than the general population

By Language

Breakdown of Online Candidates *

Arabic & EnglishEnglish

Only

English &Other language

By Level of Education

No UniversityDegree

With

Uni

vers

ity

Deg

ree

*

Base

d on

Gul

fTal

ent’s

dat

abas

e of

1 m

illion

can

dida

tes

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Online candidates include a significant proportion of mid-level and senior professionals

By Age By Seniority

13%

29%

22%

15%

15%

6%

Under 26

26-30

31-35

36-40

41-50

Above 50

9%

20%

34%

29%

8%

ExperiencedProfessional

Junior Professional

Fresh Graduate /Student

Director /Executive

Manager

Breakdown of Online Candidates *

* Based on GulfTalent’s database of 1 million candidates

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57%12%13%

14% 4%

Online candidates include a diverse talent pool from different locations

By Country of Residence

Asia

GCC **

Middle East(excl. GCC)

Europe / US

Other

Breakdown of Online Candidates *

* Based on GulfTalent’s database of 1 million candidates** Gulf Cooperation Council (GCC) countries include Saudi Arabia, Kuwait, Qatar, Bahrain, Oman and the United Arab Emirates

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Candidates from all major industries and job categories can be found online

By Industry By Job Category

5%

1%

3%

3%

4%

5%

5%

6%

6%

7%

8%13%

16%

18%Construction & Real Estate

Banking & Finance

IT & Telecom

Oil & Gas

Education

Manufacturing

Retail & Consumer Goods

Healthcare

Marketing & Media

Transport & Logistics

Hospitality

Government & Public Sector

Recruitment

Other3%

1%

2%

3%

4%

4%

6%

6%

6%

7%

10%

13%

14%

21%Engineering

Finance

Sales & Customer Support

IT

Administration & Secretarial

General Management

Marketing and PR

Education & Teaching

Healthcare

Human Resources

Logistics

Procurement

Legal

Other

Breakdown of Online Candidates *

* Based on GulfTalent’s database of 1 million candidates

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Glossary of Key Terms

Online recruitment portal

Job posting

CV database search

Active candidate

Passive candidate

Contingency recruitment

Retained search

An Internet website where employers advertise their vacancies and candidates register their CV to apply for those vacancies, or to be otherwise found by employers for potential job opportunities.

A job advertisement placed online on a recruitment portal, allowing candidates to review and submit their applications directly to the employer advertising the vacancy.

An online facility allowing employers direct access to the CV database of a recruitment portal, to search and find candidates with the desired profiles and to contact them directly without the involvement of an intermediary.

Someone who is interested in changing employment and is actively searching and applying for vacancies.

Someone who is potentially open to considering alternative employment opportunities, but is not actively searching and applying for vacancies.

A type of recruitment service where the recruitment agent receives a fee only upon successful placement of a candidate. The employer typically works with several competing recruiters.

A recruitment service where the agency is exclusively retained by an employer, with an upfront payment, to fill a particular vacancy. The agency typically uses a headhunting approach to target passive candidates.

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Further information is available at: www.gulftalent.comTel: +971 4 367 2084

Disclaimer & Copyright

About GulfTalent

Headquartered in Dubai, GulfTalent covers the markets of Saudi Arabia, Kuwait, Qatar, Bahrain, Oman, Egypt, Lebanon, Jordan and the United Arab Emirates.

This document should be used for information purposes only. GulfTalent makes no claims or warranties regarding the accuracy or completeness of the information provided, and accepts no liability for any use made thereof. The recipient is solely responsible for the use of the information contained herein.

GulfTalent is the Middle East’s leading online recruitment portal, with a database of over 1 million professionals covering all sectors and job categories. It serves as the primary source of both national and expatriate talent to over 2,000 employers and recruitment agencies across the region.

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