Hiring From The Same Industry: Pros & Cons

Hiring From The Same Industry: Pros & Cons.

In the hyper-fragmented world of recruiting, it’s important for hiring managers and recruiters to have a wide variety of sourcing techniques at their disposal. With exception to specific scientific or high-tech IT and engineering roles, most job requirements such as management skills, decision-making abilities, common ground experiences, and education level can be found in candidates from any other industry. So how do you decide where your next hire should come from? Here are some tips to help you weigh the pros and cons before you decide to hire from the same industry.

What Is Industry Recruiting?

Industry recruiting is when a recruiter or hiring manager finds candidates from the same industry as the employers. It is a highly specialised form of sourcing that requires a great deal of knowledge about the industry specifics, which include its relevant technology application, the company’s business, and network within the industry. There are several advantages and disadvantages to hiring from the same industry.

Advantages Of Hiring From The Same Industry.

1. One of the biggest advantages of hiring from the same industry is that you may have an easier time finding candidates with the same industry knowledge. You only need to focus on a specific industry candidate pool that is already looking for jobs. Your search is narrowed down to only those candidates who are likely to be a good fit.
2. Another advantage is that it is easier to communicate with them as they would understand the industry’s lingo and jargon. If your team is made up of people who work in the same industry, they will understand each other better and communicate more efficiently. This may support your talent retention objectives as these candidates may fit better culturally.
3. You will also save time in training the new hires as they have the foundation from the past job, which is within the same industry as your company.

Disadvantages Of Hiring From The Same Industry.

1. The biggest disadvantage of hiring from the same industry is that you may face fierce competition in hiring from the same pool of talents. This is especially true if you are from a niche industry where the demand for a specific skill set of talent is higher than the supply.
2. Competing for similar industry talents could also impact your cost of hiring over time as employers may offer better rewards to attract them, hence affecting your overheads if you do plan to match or counter offer.
3. Another disadvantage to industry recruiting is a lack of diversity. Hiring from the same industry may skew hires to fit a specific profile. Your team may lack diverse ideas and solutions. This could lead to a lack of creativity and innovation due to homogeneity in your team.

Strategies For Successful Company-Wide Recruiting.

So, how do you determine whether you should hire from the same industry or not?

It is easy if your objective of hiring is to replace an existing employee who has tendered his or her resignation. You can just list out the skill set of the departing employee and look for the same skill set in the potential candidates via job ads or a recruitment agency.

However, if you're taking the opportunity to restructure your team to bring in creativity, diversity and innovation, you will need to strategise your hiring plan. The first step is to make sure that you have a clear idea of your department's structure and how this new candidate will fit into it. From here, you will need to prepare a well-defined job description for the new role and what are the expected skillset. Group the skillset into essential and desirable skills. Then, look for the candidate who fulfils both categories at the approved budget for this headcount. By doing this, you're adopting a skill-based hiring strategy that focuses on the results you would like to see, rather than the type of candidate profile or specific industry that you think could deliver those results.

In the event that the hiring managers are not sure about the possible benefits or transferable skills of a candidate from a different industry, or do not have experience in conducting an assessment of specific skills of another industry, they can seek professional advice from a recruiting agency which generally brings a broad knowledge of various industries and a wide network of talent pools. Usually, an experienced professional recruiter can identify complimenting or transferable skills and suggest the right recruitment strategies to their clients.

Conclusion

Both recruiting from the same or different industry has their advantages and disadvantages. The former could provide you with a lot of commonalities that you can build on, while the latter offers you new opportunities to explore new ideas and possibly new best practices for your business. Hiring outside of industries has become a norm these days. If you are looking to hire from a different industry, you could do a reverse study on the similarity of groups of clients or identical functions which the role is required to serve and how the candidate could be effective. One of the past popular practices was to hire sales and marketing talents from the FMCG industry to fill Retail Banking roles, which resulted well as the candidates serving similar types of consumers of varied lifestyles. 

If you are experiencing a talent crunch and would like PERSOLKELLY to help you in analysing your current situation and finding the right talent for your organisation, you can reach out to us at info_kr@persolkelly.com.