Creating a One-Stop 'Human Capital' Shop

FRAMINGHAM (05/01/2000) - These days, if you want a desk, you go to OfficeStuff.com (or whatever) and pit desk-makers against one another for the low bid, right? For a customer relationship management suite, you go to CRMmart.com (or whatever) and let a dozen vendors haggle for your business.

Small surprise, then, that pretty soon, when you want a programmer/analyst, you'll go to Personic Inc. or one of its competitors, give your requirements and wait for information technology workers to call.

Brisbane, California-based Personic hopes to do for what it calls the "human capital supply chain" what Commerce One Inc. in Pleasanton, California, and Ariba Inc. in Mountain View, California, have done for business-to-business procurement: develop a technology infrastructure. "Think of us as a Nasdaq for human capital," says Mohamad Boroumand, the company's chief strategy officer.

Personic will handle not just IT workers but also employees of all stripes, from office temps to high-level executives.

Stiff Competition

As an established recruitment player with 300 employees, Personic is unlikely to dry up and blow away. But with competitors attacking the red-hot market from myriad angles, the big question is whether Personic's business-to-business exchange concept - to be called the Personic Exchange - will take hold. And how comfortable will corporate America be ordering employees the same way it orders a box of pencils?

Founded in 1994, Personic sells recruitment software packages, called EZaccess and Workflow, and has more than 600 customers, including Wal-Mart Stores Inc. in Bentonville, Arkansas; L.L. Bean Inc. in Freeport, Maine; and Enron Corp. in Houston. The company hopes to leverage its expertise and installed base to launch the Personic Exchange this quarter.

"[Personic is] well established in recruiting," says John Hagerty, an analyst at Boston-based AMR Research Inc. "They're coming at [the market] from their core competency, which is getting people into companies."

The Personic Exchange will look familiar to anybody who's used other business-to-business procurement exchanges. A buyer - whether an in-house recruiter, a hiring manager or a human resources agent - posts an open position, including specifics such as a job description, pay range and location. A seller of labor then responds.

"We've heard so many horror stories of [hiring companies] paying headhunter fees for people they've already got in their database," says Ankesh Kumar, Personic's co-founder and chairman. "With us, you're getting better mileage out of your recruitment budget."

With Personic Exchange, the seller can be just about anybody in the labor supply chain. Sure, it may be Joe Schmoe looking for a job. But more likely, the seller will be somebody else.

"A big company probably uses 50 [sources for] staffing," Kumar says.

Managing Resources

This one-stop shopping appeals to Dan Reilley, staffing manager at Novell Inc.

Already a Personic software customer, Novell plans to check out the exchange.

"Everybody tells you the more exposure the better" when you're hiring, Reilley says. "But when you use over five [Internet recruiting] sites, you've got to go back and manage all [the recruiting information]. It's a lot of work."

Personic will allow all parties to transact business in a single place, supporting both one-to-many and many-to-many models. The company will draw on its recruiting-software background to help [clients] sift through résumés.

While hiring is today's major IT human resources headache, getting rid of people costs money, too. In large, dispersed IT organizations that hire lots of contractors, this can be a problem. "You hire someone for six months," Boroumand says. "Eight months later, they're still there - at $150 an hour."

Hagerty says that when he declares workers must be treated like resources, "I get the head nods - but I also get raised eyebrows." To some, he says, the idea appears "dehumanizing." He says this cultural issue is one of Personic's major roadblocks.

And the company knows it. "There are nuances here," says Tadhg Canniffe, co-founder and chief technology officer. "You're not buying a chair. We ‘get' the recruitment process. We've been doing this five years now. We hear the pain from both sides."

Kumar adds, "We want to be a true intermediary. Screening, filtering and assessing [job candidates] is still for staffing pros. Our software will facilitate that process, not replace people."

Ulfelder is a freelance writer in Southboro, Massachusetts. Contact him at ulfelder@earthlink.net.

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