A Preferred supplier list (PSL) is a system which should allow you to streamline your recruitment process, limit your workload and save you a great deal of time. It is a grouping of agencies, or consultancy's depending on the level of interaction, which a client has elected to be their sole suppliers. These PSL’s are not just a list of suppliers whom you want to do business with, but they are a group of suppliers who are all working to the same set of goals, with the same service level arrangements and payment terms.
In theory a PSL sounds perfect, surely?
You don’t have to listen to the 10th recruiter telling you about their fantastic candidate, you can monitor and review the said supplier’s performances and most importantly, you maintain a healthy competition amongst your chosen suppliers to provide you with the best candidate for the job.
However, due to the current market being heavily candidate driven, combined with the exponential growth of technology such as CRM’s, mobile platforms and multi-platform job postings, there is a strong argument that PSL’s are an outdated method of recruitment. Furthermore, one could argue that limiting yourself to using a select few agencies is then reducing your chances of finding that all elusive goal- the best candidate for the job.
In addition, the practice of limiting yourself to a small number of agencies actually makes very little sense from a business point of view. You would not operate this way in any other walk of life, for example if you were going to the supermarket, you would not pledge loyalty to Tesco, especially if Sainsbury’s had a better product or a cheaper price. If you are client, a key question to ask yourself is: am I prepared to miss out on the right candidate for this role?
PSL’s have also given clients an escape from speaking to agencies.
If you are a recruitment consultant I am sure you hear ‘we have a PSL’ at least once a day. Contrary to popular belief, recruitment consultants aren’t looking to sell you a fast one, we make an effort to understand our candidates, their motivations aspirations, reasons for leaving; we become familiar with certain candidates and build genuine connections. When we call up a client we aren’t just selling a product, we are offering a solution tour recruitment problem. Now you may receive 10 of these calls a day and dismiss them with a PSL objection, but what if on the other end of that phone is a consultant who has the perfect candidate for the role? You are missing out on a candidate and therefore the solution to your problem.
A PSL can be an important way of controlling and monitoring your agencies performances however it can also hinder your recruitment drive and limit the possibility of finding the best candidate for the job.
Does a PSL have to be so rigidly adhered to, or would a tiered and flexible approach to each unique recruitment element, with a creative and effective solution improve staff retention and reduce the impact of recruitment spend on the bottom line?