What is Direct Sourcing and why should I be thinking about it?
What is direct sourcing and why should I be thinking about it?
The need to recruit high-quality, flexible talent is essential to a company’s competitiveness in the market. Direct sourcing has become the latest talent strategy to provide organizations with top talent in a flexible, agile way.
The most commonly accepted definition of direct sourcing means leveraging a pool of pre-identified talent that can be engaged on-demand versus recruiting talent from external staffing suppliers.
Historically, staffing suppliers were considered the most common and widely used resource to access contingent labor. Vendor Management Systems (VMS) have become the norm for managing those staffing suppliers and the candidates they submit. Unfortunately, companies are beginning to realize that their VMS (and Applicant Tracking Systems) feels like a bottomless bucket. Once the talent goes in, they rarely engage or use that talent again. There is no simple mechanism for engaging or redeploying known talent. This is both costly and nonstrategic.
Globalization, labor market changes, the rise of the gig economy, and remote work, coupled with technological advances, have taken the concern over access off the table. Companies want control over their contingent labor talent. They want to directly market their brand and redeploy known, qualified talent quickly.
A company’s brand is its lifeline -- to customers, consumers, and those who do/will work for them in the future. It’s an impression left on everyone it comes in contact with and is a critical component of success. Engaging through a talent community specifically about its brand, communicating with them directly on what’s happening in the organization, and attracting quality talent based on its brand is unique to direct sourcing.
Today, companies are concentrating on attracting talent that is looking for flexibility and the opportunity to directly impact their employment environment. Candidates want more control over how they are being represented than a staffing supplier simply submitting their resume to a job posting.
What’s more, a 2019 Mercer study found 79% of executives expect that contingent and freelance workers will “substantially replace full-time employees.” Developing a long-term contingent workforce strategy that quickly targets quality candidates in this labor category is more critical than ever.
The needs of the worker have also changed. Workers want flexibility, transparency, a sense of connection to and community in their workplace, and the ability to help shape their workplace culture in definitive, meaningful ways. Direct sourcing allows candidates to target companies of interest and showcase their capabilities more comprehensively by providing skills assessments, interview collateral, and having the ability to respond in a more direct, personal manner.
What’s in it for me?
Direct sourcing offers a lower-cost alternative to traditional staffing firms. It does this by leveraging the brand to draw in talent, reducing time-consuming recruiting activities through the technology efficiencies provided by talent pool technology, avoiding costing staffing agency mark-ups, and reducing compliance risk.
It also offers greater flexibility, agility, improved candidate quality through more thorough vetting, decreased time-to-fill (upwards of 15% faster) by cutting out the middle-person, and offers the economies of scale necessary to compete in today’s global market. What’s more, clients finally own the right to engage and manage the talent through their technology, something they do not have through a traditional VMS.
As diversity and inclusion initiatives remain top of mind for prospective candidates and companies alike, direct sourcing allows for community/talent pool building and tracking mechanisms to be put in place to report on diverse candidates of all employment types. Sub-pools (aka Talent Puddles) can also be created within a talent pool, allowing targeted campaigns to be generated when organizations have specific hiring needs.
Direct sourcing technology also allows organizations to engage talent before they ever work for them by communicating specific information on brand, company culture, communications around company goals and initiatives, and providing a sense of community not found via traditional sourcing methods.
Having an engaged talent community ready, connected to their brand, and excited about working for them, regardless of how they are employed (i.e. full-time, contract, SOW, etc.), will help down the line with retention, as well as an organization’s reputation in the market.
If you want to know the pros and cons of public versus private pools, and the importance of having vetted, curated talent be a part of those pools, check out our article, “What is expert vetted curated talent and what is its value to an organization?” which offers more insight as you formulate your global talent strategies.
About High 5
High 5 is a world-class technology and service platform that helps organizations get work done. We connect talent with opportunities on a global scale -- from full-time to part-time, contract to contract-to-hire, project-based SOW, on-site or remote work, from gig-work to big work -- it all gets done on High5.
To learn more about High 5’s product offerings in Expert Vetted Talent and Direct Sourcing, please visit high5hire.com.
Want to learn more about applying Direct Sourcing to your business? We'll send more information your way.
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