HBS Start-Up Profile: Job Hunting in a Crisis
The Dow Jones may be recovering from its record lows of last year but the same is certainly not true of the job market. Companies are still reeling from the recession and uncertain about their hiring plans. Many companies are postponing hiring until needs become more proven, and most students are rightfully preparing for an extremely challenging job search process.
But tough times are also an impetus for innovation. Rather than being simply overwhelmed, a number of HBS students are exhibiting an uncanny knack for ingenuity and are working hard to ameliorate the situation. A new, innovative recruiting tool being launched by three EC students is one example. Skydeck360 (a play on the HBS skydeck row) offers a way for students to signal their preferences to employers and improve their odds of landing the job they want.
So how does the solution work? The Skydeck360 platform will open for a limited time when each student can register and designate a few companies to signal serious interest to. Shortly after the platform closes, Skydeck360 will aggregate and transmit this information to companies, providing these companies with information on which candidates REALLY want to work for them. Everyone wins-companies get information about which students are truly passionate about working at their company, thus improving their recruiting yields (and saving costs), while students enhance their chances at standing out from an increasingly crowded competitive pool.
Of course the key question is: Will the idea of understanding student preferences take hold in the MBA recruiting market? Abhinav Agrawal, a co-founder, says that the idea of preference signaling is backed by serious academic research (Michael Spence won the 2001 Nobel Prize in Economics for his research on signaling) and is already in use. Signaling works because it helps solve a fundamental problem in every transaction-information asymmetry, in this case, between the employer and the job candidate. Education credentials signal a certain kind of information that is useful for employers in making hiring decisions; but in a world where candidates all have degrees from top-notch schools or work experience in the top firms in different industries, the information value of preference is heightened. “Signaling is used in hiring economics faculty or matching residents to medical schools-this is an opportunity for business school recruiting to become orders of magnitude better,” says Abhinav. The team worked with Andrei Hagiu and Peter Coles, professors at Harvard Business School and experts in the subject area, to perfect their model.
Abhinav and Yasser Salem (OI) hatched the idea for Skydeck360 during their RC year. They had been part of the same class at McKinsey and were interested in pursuing an entrepreneurial venture during their time at HBS. They realized they had a common interest and expertise in recruiting. Yasser had founded an executive search firm after leaving McKinsey which placed candidates into finance roles in the Middle East. In a similar vein, Abhinav was intimately involved in recruiting at Harvard Business School and was familiar with the problems faced by recruiters. Soon thereafter they were joined by Patrick Chun (the third co-founder) who was running for SA Co-President at the time and realized the extent to which the student body was really worried about the job-market. Patrick focused the team on designing a solution that fit HBS’s rules on recruiting, creating true value for students. “This tool is a marriage of recruiting and Web 2.0-enabled information exchange, providing additional connections between employers and HBS MBAs-this is something that really excites me given my personal commitment to seeing our student body get the jobs they want,” says Patrick, who is now student body Co-President.
Skydeck360 will go live in October, and will initially be available for only RC students. The tool is designed for simplicity: all students have to do is sign up on the Skydeck360 website and indicate their top choice companies. This data will then be automatically aggregated and shared with recruiters by Skydeck360 in early November. The Skydeck360 team has carefully crafted the platform to maximize the upside for students, while making it risk-free for the companies as well. “We’ve designed the preference signaling to allow for students of different backgrounds and experiences to improve their recruiting chances,” says Abhinav. “Everybody should join, because there is no downside to joining.”
For example, let’s say Mary, an HBS student with a very strong background in a specific industry/function wants to return to that industry/function. For Mary, this tool can be extremely useful to reassure companies and use a scarce signal to indicate interest. This may be especially helpful to Mary if the company may have perceived her application or pedigree as “too strong” and may have previously thought she would have declined any offer. Students of different backgrounds will benefit as well: if John, for example, is a career switcher, then he can use his signal to convey his passion and underscore his commitment to switching careers and joining their firm. So, who can this platform hurt? Trophy hunters possibly-but only if they continue to pursue a broad machine gun style strategy towards recruiting. “Continued trophy-hunting will not have as big a negative impact on fellow students as it does today,” says Patrick. “However, trophy-hunters who are thoughtful about their process will also find this tool wholly beneficial. This benefits all students, and helps companies in the process.”
So with everything going for them, what are the outstanding challenges for Skydeck360? According to the founders, their biggest barrier is one of awareness. HBS students are incredibly busy, and the team is not sure whether RC students will engage in career related topics this early on in their HBS experience. To build awareness and understanding of their tool, the founders have been developing partnerships with many of the student clubs at HBS. For example, James McNally, an officer in the healthcare club found the concept of Skydeck360 very intriguing and believes it would be, “a fantastic way to get in front of healthcare companies and demonstrate interest.” They are also working with administrators, career services, and professors to make the offering the most impactful on campus. Professor Peter Coles, who helped build the American Economist Association signaling network and teaches an EC Class called Market Design, states, “In labor markets, credibly signaling information about preferences can be notoriously hard, even though this information is valuable to candidates and employers alike. [Skydeck360] may really be on to something, as a preference signaling service could create significant value for each side of the MBA job market.” While they still have their work cut out for them, Abhinav, Patrick, and Yasser are confident students will recognize the platform’s value and that this platform will really help with RCs’ summer recruiting efforts. “We have a lot of exciting plans and ideas about where we can take this in the long run-this is just the first step in using technology to redefine recruiting,” says Yasser.
Oliver Segovia is a second-year MBA at the Harvard Business School, where he is a Board Director at the Harbus News Corporation.