The Line Between Software Company and Recruitment Agency Is Blurring – and That's a Good Thing

One of the questions I get asked a lot is, "Is WeFind a software company or a recruiting agency?" I hate this question, mostly because it assumes you have to be either a software company or a recruiting company. For me, this raises further questions: What's the difference, and does it matter?

Traditionally, there has been a very clear distinction between software companies and recruitment agencies. Major HR tech players like LinkedIn offer subscription access to their platforms with no human consulting or intervention. LinkedIn is built so a recruiter can leverage technology to do their job better.

Agency recruiters, on the other hand, have always been people-driven operations. They consider their key differentiator to be the personal touch required to really determine if a candidate is the right fit for a role. Emma Hatto, a cofounder and director at agency recruiting firm BOWER Talent, says, "I want to sit across the table from a new candidate and look them in the eye to understand if they are a fit."

In summary, then, we can say that most technology companies enhance the recruiter's capabilities with tools, whereas most agency recruiters offer end-to-end people-oriented recruitment services.

However, in 2017, the difference between agency recruiters and software companies is no longer black and white. Arguably, the companies that will win are those that decide to blur the line.

Recruitment Software and Recruiting Agencies Are Starting to Look Similar

It is a software company's ultimate goal to provide users with a product they love and consistently want to use over and over again. The advantage of software is it allows you to do tasks that used to be completed by humans in a much more scalable way – and often in a way better than humans ever did them. In the recruiting market, the way to truly achieve this is by consistently introducing recruiters to high-quality candidates that are hired and retained by the company for a long period of time. This is what buyers in the recruiting tech space will expect – and the reality is that the human touch is still required to provide such results.

For example, consider the difference between evaluating a candidate on paper and conducting an in-person interview. A candidate may have stellar experience on paper, but when you speak to them in person, their composure and personality fit may turn out not to match your needs. Software is of little help here because, for the most part, information about a candidate's personality isn't available online. As the human experience becomes further and further integrated with the web, this data may become readily available – however, we're not there just yet.

Meanwhile, agency recruiters must start thinking about how software can transform their service offerings. While technology hasn't addressed every recruiting challenge, it has started to transform how recruiters spend their time. Manually reviewing 300 resumes just doesn't make sense when software can do it for you. In addition, the growth of freelance labor has transformed how companies think about talent. Recruiters must adapt to the new realities of talent acquisition in a gig-driven market.

BOWER Talent has seen these changes, and the company's response to them is in many ways illustrative of how the line between software company and recruitment agency is blurring. In addition to integrating new profiling technologies into the recruiting process, BOWER has also launched a service designed to help companies gain access to virtual personal assistant talent. The service, called BOWER Virtual, is very similar to Fiverr, Upwork, and other gig talent platforms.

Georgina Bale, the other founder and director of BOWER, says that she has "a strong opinion that recruitment won't be around in its current form for a long time, and it will be transformed into a new tech-driven hybrid industry. Today, it is mostly human touch, but we know technology is the way forward."

Many agency recruiters are skeptical of new technology. To quote one agency recruiter I used to work, "Everyone thought job boards were going to kill recruiting, and they didn't. Then it was LinkedIn, and they didn't. We are still here for a reason."

On the flip side, many in the technology space reject the human element. Humans are hard to scale, and compared to artificial intelligence, many believe the human perspective provides flawed insights into what truly makes for great candidates.

Neither of these points of view are entirely incorrect, but they are incomplete. While agency recruiters are still responsible for 15 percent of sourcing work, job boards now account for 15-20 percent of jobs filled today. While LinkedIn brought over 400 million resumes online, many recruiters find the platform oversaturated and are testing new tools to find great talent.

Humans still have an important role to play in the recruiting process, but the current wave of new technologies has transformed the profession and will likely continue to do so. Artificial intelligence is only getting smarter. Data on the human experience is only becoming more readily available. As a result, there will be a gradual shift in how humans and technology interact to find great talent. Software companies and agency recruiters that embrace this interaction will win in the long run.

David Sokolow is the Founder and CEO of WeFind, a talent acquisition tech company.