The practice of hiring passive candidates for highly-skilled positions can be a valuable recruitment strategy. This involves the hiring of candidates with at least a few decades of experience in similar positions, who can lead your organization and improve performance. Otherwise, you hire a seasoned professional who can quickly learn and doesn't require a similar onboarding process to a less experienced candidate or someone who has been promoted within the company.
What is Lateral Hiring?
Lateral hiring refers to the process of recruiting professionals who are currently employed in a position similar to the one you are looking for. These professionals are considered passive candidates, and they are not actively looking for a job.
These candidates will be happy in their current job and not open to new opportunities if the opportunity is appealing enough (in terms, for example, of career advancement). They have a strong reputation in their field and are well-connected. These candidates can be a great choice if your company is looking for specialized, niche-specific talent.
This is where lateral recruiting can be very effective. This allows you to find someone with the right experience to take over and do the job. Instead of having to hire someone with a lack of these skills and then training them, you hire a qualified candidate who is able to hit the ground running.
What are the advantages of lateral hiring?
Your business can reap the benefits of lateral hiring in the short- and long term.
First, hiring someone laterally reduces the amount of time and resources required to train them. This is especially important when filling a job that requires specific skills.
Second, Hire lateral employees. They can bring in their knowledge and skills from other work environments. This can increase innovation. Studies have repeatedly shown that companies that embrace innovation are more productive and achieve better business results.
Third, as previously mentioned, lateral employees already have a network of connections that can be beneficial to your company over the long term.
What are the best times to consider lateral recruitment?
Although it can be used in all industries and organizations, lateral recruiting is particularly useful in highly competitive industries where niche knowledge is crucial to success.
When your company is growing and going through a transition like a merger, you can also use lateral hire.
Your company can benefit from a lateral hire who has the required field experience to help it navigate this uncertain period and remain competitive while achieving its business goals.
Shareholders and stakeholders will feel at ease once you announce the news about the merger or expansion.
You can also opt for a temporary hire in certain situations, such as if you are looking for an expert to fill a vacant position and there are no qualified candidates in your talent pool.
How does the lateral hiring process work?
After a position is clearly defined, the lateral recruitment process should be managed either by an HR executive (headhunter) or in close collaboration with the executive team.
This is because these roles require specialized knowledge and skills. Many times, the only person who knows all the details is the top management.
The person responsible for the lateral hiring process should be fully informed about the requirements of the role, the company's goals, and any remuneration or benefits that they can offer the candidate.
After identifying the right candidate, the executive team usually hires an external recruiter to try to reach them.
This is done in order to avoid any litigation if a competitor firm discovers you are trying to pinch one of its staff.
It's also unprofessional to try and poach top employees from your competition. This is a common practice in large businesses.
These are the 7 steps to lateral recruitment
In that the ultimate goal is to find the best person for the job, lateral hiring is similar to all other types of recruitment.
However, its mechanics are quite different from traditional hiring processes.
You are searching for someone who has a track record in the field and is not available for an open job.
You want to attract a candidate who is happy at their current job and wants to work for your company.
You want to offer them something they cannot refuse.
These are seven crucial steps to follow in order to make your lateral hiring process a success.
1. Define the needs of your company
You must first establish the goals of your organization and decide how lateral hiring can help you reach them. It is important to clearly describe the role and the skills and expertise needed for the job. A candidate who is a good fit for the role should be able to understand the industry they work in, the challenges they will face, and how they can overcome them. They should also have a track record of success in similar roles with their current or previous employer.
2. Research every potential prospect
It will be difficult to find lateral hires, especially if you don't advertise the job opening. Candidates may also be employed elsewhere and not plan to move to another company. You should therefore look beyond your immediate area to search for the right match.
These are the questions you can ask to help you find the perfect candidate:
- Who was recently in the media spotlight because of their accomplishments?
- Who has published reports, papers, and articles in your field?
- Who is a well-known industry professional who has attended symposiums and events?
These questions will allow you to identify potential candidates for lateral hire.
This stage is where you can start researching their success stories and track records, and narrowing down those who are most notable. After you have narrowed down the top candidates, you need to thoroughly research each one. You might be able to find out more about them, their past work, reviews from their colleagues on LinkedIn, interviews that they have given, and any other success stories.
This will allow you to get a better understanding of each person and their work ethic as well as their ability to face serious challenges. Once you are satisfied with your findings you can compile a list that could attract the perfect candidate.
3. Your company is better than the current candidate
Most lateral recruiting is done at the executive level. Remuneration for this position is generally similar to other fields. Hence, candidates will not choose to work for you if they have more money. Instead, use the research you did to learn what could entice them into leaving their current employer. Maybe they will get a different set of perks than their current company. Perhaps they will be attracted to your company's mission and values. You could also offer them a job, even one that you create for them, which offers more career-growth opportunities. They may even be tempted by a project they are only qualified to handle because of their track record.
This step is where you will sell your business and the benefits it offers. This offer should be as attractive as possible to convince the candidate to consider the position even if it is not immediately appealing to them. To get them onboard, you'll need creativity and flexibility.
4. Contact candidates discreetly
Once you've found the right person, it is time to get in touch with them. This is a good time to show respect for these people as they are already well-known figures in their work environment. They are passive candidates, and they don't actively seek out new roles. Don't be affluent and approach them with caution. You might consider entrusting this task to an outside recruiter who is well-versed in your needs and wants.
Introduce yourself to them and tell them about a job opportunity. Then, ask them if they are interested in learning more. You can arrange a meeting if you receive a no. Do not ask for CVs from candidates and don't expect them to openly discuss the job. Instead, send your pitch and wait to hear back.
Don't try to persuade them if you get a negative response. Just move on to the next person in your shortlist. You should not divulge too much information to uninterested candidates. It is not your intention for them to reveal your secrets to the rest of the field.
5. Negotiate
After you have contacted your potential hire, the negotiating stage of lateral employment begins. You will need to pitch the person and convince them to join your company. You should offer similar perks to them, even better than their current compensation package.
It is also a smart idea to give them the chance to work in a more challenging position - one where they feel at home and are able to take control and be creative. These are often the motivating factors that make people want to join your company, not just a slightly higher remuneration.
6. Offer
You must act fast if the prospect says yes and offer them a deal before they lose interest. These people are happy where they are. Even though they might be attracted to a new project, they may not take the time to offer.
To sweeten the deal, ensure that your offer is in line with their expectations.
7. Strategically onboard lateral hires
In lateral training, it is more important to properly onboard new hires than normal. Although lateral hires won't need as much training as other employees, they will still need to be integrated into the company and become part of the team. They will also need to learn about the culture and values of the organization. If you want to keep them and reap the benefits of hiring someone with significant expertise, this is essential.
A study by ALM Rival Edge found that 47% of lateral hires by law firms don't stay for the full five-year period after they are hired. This is costly and detrimental to the firm in the long term. It takes between two and three years for new hires at the firm to get up to speed, and many more years to achieve the desired results.
This is often the case when lateral hires are not properly onboarded and don't feel settled in their new positions. This study was limited to law firms but it can be assumed that the same applies to other industries.
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