• Building a pipeline of talent will help you compete and keep your growth in line with the economy.
• Areas where distributors have struggled to keep pace with other industries — websites and social media — are opportunities to make incremental changes.
• Start small: Look for ways to differentiate in the eyes of recruits, such as with an internship program or the way you create a career path for employees.
As the country continues to reopen at a rapid clip and the economy gets cooking once again, the war for talent is also heating up. And the speed at which your company can grow alongside the improving economic climate will depend on your talent, according to Bharani Nagarathnam, Ph.D., associate director, Master of Industrial Distribution Program, Texas A&M University. Nagarathnam delivered the presentation, “How to Build Next-Gen Talent Pipeline: The Mindset of Gen Z,” at MDM’s recent Future of Distribution Summit, held virtually in April and available on-demand.
As Nagarathnam outlined in his presentation, distributors are competing with everyone — not just their competitors — for talent. And successfully recruiting, developing and retaining the next generation of employees begins with understanding Gen Z’s expectations, needs, priorities and mindset. “Who is your competition?” he asked. “It’s not other distributors. The competition is everybody — retailers, the warehouse down from your street, tech companies. You need to develop a multifaceted approach to your talent acquisition and align that with your business strategy.”
What is an EVP and how do you develop one?
Younger generations are spending less time with companies than, say, baby boomers or even Gen X. So the first step to improve its talent recruitment efforts is to create an employee value proposition (EVP), Nagarathnam said. “It’s very important for us to understand why people join companies, and why people leave companies,” he said. “One way to achieve this is by developing an employee value proposition, which is very similar to a customer value proposition. If a customer value proposition is about why you should do business with us, very similarly an employee value proposition is about why you should come work for us — beyond the pay.”
Nagarathnam said a distributor’s EVP should include tangibles, such as compensation and benefits, but it should also include intangibles, such as the company’s work environment and culture. “It has to be authentic and unique to you or your company,” he said. “A good way to start is by asking your long-term employees why they work for your company. Also, you can ask some of the new employees why they chose your company.”
In that surveying of employees, a company’s HR department and leadership team can get a better sense of that company’s EVP. Then, Nagarathnam said, “you need to articulate that and disseminate that within the company. That helps you to provide a consistent and clear message, which everybody in the company uses.”
At that point, you can begin sharing that message with recruits. “Once you have formulated that, you need to put that on your website, in your marketing collateral, in your recruitment material,” Nagarathnam said. “Also personalize the EVP. Why somebody should come work for you at a management or leadership level is different from an entry-level position, a sales professional career, or a warehouse job.”
Once an EVP is established, distributors can begin a three-pronged approach to reaching Gen Z through specific means that might not have worked for previous generations.
Action item No. 1: Digital
The first is through digital means, including making significant updates to your website and social media channels. By improving the career section of your website, you’ll better engage with the Gen Z prospects who are likely to research your company online before even considering applying for a job. “Many distributors have just one page that lists open jobs,” Nagarathnam said. “Include as much information as you can because this is the first place that a prospect and potential applicant will see you. Put out as much information as you can on why somebody should work for your company.”
Next is making sure you’re active on social media, but not just for selling the latest cutting tool or newest line of fasteners. This is a chance to give your company some personality while also letting potential recruits know more about the business than whatever SKUs you sell.
“I’m sure many already use it to promote your product or services but also use it to promote your culture, your EVPs and your recruitment,” Nagarathnam said. “This is very important for recruiting.”
Action item No. 2: Internships
Internship programs are a low-cost option to recruit and build a pipeline for your talent. But beware of establishing a counterproductive internship program that sends other prospective candidates running. “If an intern has a good experience, they come back and tell all their friends back at the university,” he said. “If they have a bad experience, they come back and tell a lot more people about it. So, it’s very important that the internship experience be meaningful. While you are interviewing them for their skills, for their abilities, they are interviewing you to see if this is a place where they wake up Monday morning and want to come to work. Think of it as a 10-week extended interview.”
One critical aspect of an effective internship program is engagement from the manager who will oversee interns. “If a manager thinks, ‘Oh, this intern is one more person that I have to babysit,’ that is not a good way to approach internships,” Nagarathnam said. “Develop a list of projects that interns can work on. Take interns to customers and see if you can schedule a manufacturer visit. The key is to have a detailed internship plan. If the intern doesn’t have anything to do and they’re just sitting around in the office, that is not a good internship experience. And finally, engage the interns by having them meet with leadership, having them meet with managers, having them present a project to leadership.”
The goal of an internship program is to convert them to full time, and even if the intern is not graduating immediately, companies can perhaps provide a letter of intent rather than an offer letter. This is another area where it’s critical that HR work in conjunction with leadership on the program’s parameters and goals.“We highly recommend distributors develop internship programs for developing a pipeline,” Nagarathnam said. “These interns will often go back to school to recruit even more interns. Internships can build your brand with the next generation of the workforce.”
Action item No. 3: Job titles & career paths
Job titles are important to millennials and Gen Z, according to Nagarathnam, who said that young people often compare their career titles and descriptions with their friends on LinkedIn. The typical job title for a distributor doesn’t fare well in those comparison discussions. This is especially true when it comes to showing prospects — at a college career fair, for example — what could be in store for them if they come to work for you. “Let’s say you are recruiting at a college campus, and they ask you about career path possibilities,” Nagarathnam said. “If you say, ‘Well, if you work hard, you will make a lot of money, and things will happen,’ what they hear is that you don’t have a plan. It is important to have a career development program.”
Like with social media or an internship program, it is critical for a company to develop this messaging and align it with the business strategy. “Make it widely available so that everybody can see it,” Nagarathnam said. “That may get you more quality applicants.”
In summary, he said, no one thing is going to make a significant difference, but the more a company tries to improve in these areas, the more they’ll see Gen Z’s top-tier talent choosing them. “These are all small people-process improvements,” he said. “Keep making those small improvements. And if you make three, four or five of these improvements, immediately you can see that your company is differentiated and is going to stand out from the competition.”
Nagarathnam’s checklist for distributors wanting to make marked improvements in their recruiting tactics:
• No one thing is going to make a significant difference
• Make small improvements in all areas
• You are not competing with another distributor for talent – you are competing with retailers, consulting companies, big box, gig economy, etc.
• Benchmark your practices
• Assign process owners for each of these activities
• Plan to grow talent – build a pipeline
• Engage leaders, manager and employees in talent acquisition
• Measure ROI
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