I propose a new staffing model: The connected talent cloud, which I call Tier 0.5. In this model, which brings together the traditional agency search and direct sourcing, staffing agencies play a vital, bridging role by working with clients and technology partners. Why am I suggesting this?

The big picture. Companies hire workers to generate revenue. On average, an employee brings in revenue of $100,000 to $2 million annually, so the revenue cost of a 30-day candidate search is $10,000-plus to the client. Meanwhile, staffing agencies work for free much of the time, typically filling 5% to 10% of the roles they work on. But with the Tier 0.5 model, both the agency and the client can eliminate cost and waste from this seemingly underperforming picture.

Let’s take a side-by-side look at both traditional tiered and directsourcing models:

Traditional. Normally, agencies are tasked with returning three CVs or résumés in three days, with shortlisting of candidates taking place in the first week and interviews/selection in a few more weeks. Rinse and repeat, expanding the search to Tier 2 suppliers if the first pass is unsuccessful, taking months to fit and fill.

Direct-sourcing. On the other hand, to direct source, an enterprise organization must create a private talent cloud, which entails engaging a technology solution and a curator if they cannot process candidate selection internally. But that takes time — at least six months to start a private cloud and another year to cultivate it to critical mass or stay with business as usual with the traditional agency model.

Thus the dilemma.

The bridge. Enter Tier 0.5, which bridges the two, reducing the time it takes to create a private cloud and allowing the client to find the best fit, fast. A connected talent cloud takes you to the next level, leveraging your database with artificial intelligence-matching to understand in seconds versus days or weeks the probability of filling a role. It’s a technology used by the client company HR or procurement teams or even possibly the line managers to check the market and adjust duration, location, rate, etc., in order to test fillability scenarios in real time.

The connected talent cloud will have millions of candidates with only a fraction currently available and interested. With a connected talent cloud offering based on this collective data, your clients could have a short-list of possible candidates in seconds. There can also be instances where the client would need to “doubledown,” using a staffing agency’s recruitment services or a combination of both approaches. Obviously, clients will pay one fee for access to the connected talent cloud, and a premium for full agency services.

Level up. Imagine empowering clients, for an additional fee, to expand the search to a network of candidates reachable through partner mini-agencies or independent recruiters. Crowd recruiting at its best! Overnight, they would have expanded their candidate pool, the number of recruiters working on their requisition and added the power of AI matching.

Given that digital transformation is here to stay and clients are moving toward direct sourcing, staffing firms can now be part of the solution to help their clients find the best blend, affording agencies the role of invaluable partner with their clients. The Tier 0.5 model not only provides this competitive advantage, but it essentially creates a new product. Client options would then include:

  • Full agency search implemented for the hard-to-fill roles that take deeper connection and recruitment skills, typically the top 20%.
  • Direct sourcing from a client’s “private talent cloud” for the easy-to-fill general roles, the bottom 20%.

And the 60% in the messy middle is handled by Tier 0.5.

Instead of simply selling recruitment services, agencies can now market data access and become critical direct-sourcing partners.