Transcript
Mark:
Welcome to People Tech, the podcast of the HCM Technology Report. I’m Mark Feffer.
Mark:
My guest today is Jonathan Kestenbaum, until September he was co-founder and Managing Director of the research and advisory firm, Talent Tech Labs. Now he’s Managing Director of Technology Strategy and Partnerships for AMS Alexander Mann Solutions. We’re going to talk about the dynamics of talent acquisition at a time when the pandemic and new ways of working are making the world to say the least unsettled on this edition of People Tech.
Mark:
I began by asking Jonathan what lured him from talent tech labs to AMS.
Jonathan:
Yeah, so I started Talent Tech Labs almost eight years ago, and it’s been a fantastic opportunity to really get deep expertise in the talent acquisition technology space. I’ve actually had this opportunity to also build deep and meaningful relationships with heads of talent and CEOs of RPOs and staffing firms. As with anything after eight years of doing something, you get excited and interested to try something new. I had this opportunity and we built a healthy business Talent Tech Labs is still growing and we’re up generating revenue, cash flow positive growing on EBITDA, right. But really wanted to try something new and leverage the knowledge that I had built up and the relationships that I built to join one team.
Jonathan:
So use it, instead of advising a number of different companies at the same time join one and be able to not only give advice, but actually make it happen. Execute on the ideas that we have and see if we can make an impact, and I had this opportunity, as I said, to advise a number of the large RPOs, and I was always fascinated with Alexander Mann AMS from the sidelines, as I believe they had the foundational elements for what would make the RPO of the future. So the second I got the opportunity to join the team, I ran as fast as I could.
Mark:
You made this move at a really interesting time in terms of the labor market and hiring, in all of these things that are just so up in the air because of the great resignation and people debating whether or not they want to go back to work or how they want to go back to work. Is that something that’s top of mind with your new team and with you?
Jonathan:
Yeah. I’d say one of the big things that I learned is, despite all the billions of dollars that have been invested in talent acquisition technology over the last five years, let’s say, which is probably like 10 billion over the last five years. You still need people and process built around that technology for it to be successful. And so now being people on process side and being able to really build ideal people and process teams around technology, I have this opportunity to see things from a different perspective and to really optimize the technology in unique ways. Definitely the fact that… Talent acquisition has been a dynamic space since 2014, when we started Talent Tech Labs. It’s definitely an interesting time, not just with the great resignation, but also with this move to remote work and how that’s changing the way that we recruit and find talent.
Jonathan:
And so I’d say and actually also I’d argue the renewed interest in diversity and the impact that could have on organizations, if they take it seriously, all of those dynamics are driving even more excitement in the talent acquisition space. So those are definitely things that are driving me towards continuing to dive deeper in the space, but I’d argue that the opportunity to combine the people process with the technology and really make one plus one equals three is what excites me most.
Mark:
Okay. Now you’re out there talking to a lot of employers, obviously, what are you hearing from them? Are there any common threads in the challenges that they say they’re facing and that they talk about?
Jonathan:
Yeah. I’m still wrapping my hands around the “great resignation” it’s early [inaudible] in terms of conversations that I’m having with folks. Well, I would argue that the verdict is still very much out on whether you’re just seeing two years of attrition in one year, rather than… During COVID not many people are leaving the organizations they’re working at. There’s no data backing up this statement right now, because we’re just starting to have conversation around it, but I’m just saying there is a case where this could just be two years of attrition happening in one year because of the slowdown that COVID brought to attrition.
Jonathan:
I think though many of the conversations I’m having are with organizations that are struggling to find talent and it’s mostly in areas where there are skill shortages. So technology but also areas where due to the COVID pandemic, for example, retail or hourly hiring folks are struggling to engage talent to come work for them and there are many drivers there.
Mark:
What’s your sense about all of the employers who talk about they can’t keep their employees, because their employees have decided they want to do something that’s more fulfilling? I read a lot of reports where employers are saying that, not sure that there’s a lot of numbers out there to directly back them up. So what’s your take?
Jonathan:
Yeah. I think that… Look, and this is actually a thesis that I have generally speaking on talent acquisition technology and just technology in general, like how I invest my personal capital in the public markets and the private market. I think that the internet has brought rapid transparency to the world. AI is starting to bring some automation and efficiencies, but the internet broadly speaking has brought rapid transparency. As that impacts the talent acquisition space, it means that the noise to value ratio, the amount of noise that [inaudible] is going to hear from other companies, because the accessibility is so much more open now because of the [inaudible] internet brings for data and information about your organization. But similarly for the companies to understand data and information about the candidate that companies are going to start to have to lean into how to best engage candidates both before they apply for a job.
Jonathan:
And then once they’re an employee, keep them meaningfully engaged with their career. I think if there’re areas where companies need to lean in based on the fact that the internet again, and technology is making its way and impacting this side of the world. Engagement is going to be one of the keys to success and that’s both on talent acquisition side and talent management side. I think that it’s something that companies have been thinking about for a while. It’s a healthy thing that companies need to start to pay attention to these things, right? The market dynamics I think will drive better outcomes for employees in the long run.
Jonathan:
It’s a challenging when these shifts happen, but I would argue that… So I think, one that particular trend is a healthy one. But I would agree that I don’t think that it’s the only reason why employees are leaving companies or are hard to find. I think that in addition to technology and its impact on talent and HR broadly, COVID-19 has created so many new opportunities for folks to work from home and in jobs that might not be… Like you don’t have to work a retail job, you could work virtually for a company now. I think that it’s opened up new opportunities in markets where those opportunities might not have existed before. And it’s creating a shift which is partially another reason why companies are struggling to find talent for roles that traditionally weren’t as difficult to find talent for.
Mark:
Okay. Now my last question for you is, as you’re embarking down this new path, what are the major challenges that you think employers and recruiters are going to face over the next say one to two years?
Jonathan:
The major… Sorry, I just want to think through my answer before I-
Mark:
The major challenges, I’m thinking about there’s an election next year. We’re still digging our way out of COVID who knows where we’ll be next year, just there’s a lot of balls up in the air. So what’s that make you look out for?
Jonathan:
Yeah. Well, I think to that point with there’s a lot of balls up in the air, companies are not sure how aggressively they should be staffing up. Which potentially could mean they could lean on contract staffing firms more meaningfully, and there’s a lot out of interesting work happening in that part of the market. I also think another trend, which I didn’t mention previously, but I think plays into the next one or two years is, as technology and now leaning into artificial intelligence makes its way into organizations, not just talent acquisition, but other parts of the business, automated machinery, automated systems for your call center. The roles that people are playing in organizations are going to change so rapidly then we’re going to have to spend time re-skilling and up-skilling our people, because the skills that they have are not going to be as relevant for the roles that we need them or tomorrow.
Jonathan:
This is partially what excited me. So as I thought about my next step in my career, part one was okay, Hey, technology is only one piece of the puzzle. The people in process part is another, so being able to mesh those three things together was exciting to me. The other side of it, I think was, I do believe that companies are going to lean on RPOs more aggressively over the next two to three years, because they’re not going to be able to skill their people and build talent pools of the new talent they need fast enough to grow as aggressively as they need. And so they’re going to lean on RPOs to help them build those talent pools because we’ll already have them potentially in the market that they’re looking to hire.
Jonathan:
So I think it’s a really exciting time for RPOs to be able to take advantage of that shift in the market. I think there are obviously a ton of other dynamics we’re not addressing like the change in leadership, COVID continued impact on our health and the world. Even putting those aside or downplaying their impact, I think without those, these things were happening and with those, these things are accelerating the need for technology in the business. And that’s accelerating the need for RPO and again, accelerating the need to figure out how to meaningfully use this talent acquisition technology and building ideal people process structures around it.
Mark:
Well, Jonathan, thanks for talking to me.
Jonathan:
Thank you for having me. Super excited to be here.
Mark:
My guest today has been Jonathan Kestenbaum, Managing Director of Technology Strategy and Partnerships for AMS. And this has been People Tech, the podcast of the HCM Technology Report. We’re a publication of RecruitingDaily. We’re also a part of Evergreen Podcasts. To see all their programs visit www.evergreenpodcasts.com. And to keep up with HR technology, visit the HCM Technology Report every day. We’re the most trusted source of news in the HR tech industry. Find us at www.hcmtechnologyreport.com. I’m Mark Feffer.
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