Meet Meena, the assistant V-P, HR, at the Aditya Birla group. After a decade of working with Korn/Ferry, she crossed over to the industry to join IBM Daksh.
MUMBAI: The head hunters are finally getting a taste of their own medicine.Being in the business of recruiting for their clients, they are at the receiving end. Many of their clients are setting up in-house units dedicated to recruitment. And the trend is gaining momentum in the Rs 600-crore Indian recruitment market.
A drift in the IT and business process outsourcing (BPO) is now trickling down to large diversified corporate houses in the country.
Meet Meena Jagtiani, the assistant vice president, human resources, at the Aditya Birla group. After a decade of working with headhunting firm Korn/Ferry, she crossed over to the industry to join IBM Daksh.
Oracle India’s recruitment services director, Jan Ackerman, is a 20-year veteran in the head hunting industry.
Having worked with the US-based head hunting firm Rogers & Associates and starting his own executive search firm, he finally gatecrashed into the corporate world. The trend is only escalating, with companies forsaking their relationships with recruitment firms.
Says Ashutosh Sinha, senior manager hiring, business and technology consultancy company, Sapient, “We are gradually trying to bring down our dependence on the head hunting industry and build a strong in-house recruitment team. The team will be a good mix of people from the head hunting industry as well as from other fields.”
Earlier, the industry sought head hunters for nearly 45% of their recruitment needs. At Sapient, it is down to an average of 16%, according to Sinha.
Why has outsourcing the recruitment function become such a big issue for corporates?
A booming economy has seen companies of all hues embark on an expansion spree, both at home and overseas. This has fuelled the demand for quality people at various levels across industries including aviation, retail and financial services.
Today, while companies are using smaller agencies to hire the mass-based entry level recruits, the larger assignments are done in-house.
Typically, companies pay their headhunters a fee which varies from 33% of the salary offered to top management recruits to 15 to 20% for middle level employees. Some human resource heads claim that this fee is rising, driven by the demand supply conundrum.
Such costs are being countered by performing the function in-house, with recruitment teams of around 10 to 25 people. “When corporates decide to build their own team, professionals from their head hunting partners become an easy prey.
Due to the long work association with clients, they understand their requirements and can be lured with better corporate perks,” says Nirmit Parekh, managing director and chief executive officer of headhunting firm Three P Consultants. Even as Parekh refuses to divulge his casualties, he adds that he’s signed a no-poaching pact with his clients.
In fact, the attrition rate in the head hunting industry swings from 30% to 40%, weaned by both corporates and competitors. “In-house recruitment division is far more dependable than relying on the outside partners.” For now at least, the name of the game is hunt the head hunters.
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