This article was originally published in Maclean's Magazine on May 10, 1999
Corporate Recruiting on Campus
The invitation was modest. Printed on plain white paper, it was billed simply as an evening to "learn how to cope confidently with cherry tomatoes." But for 60 smart QUEEN'S students, it was a clarion call. On an unseasonably hot evening last September, as freshmen pulsed down the stairs to Alfie's Pub, and lovers strolled by the lake, fourth-year commerce students battled for a seat at the first annual etiquette night. Like Scarlett O'Hara being laced into whalebone, the commerce types were being prepped for courting - courting of the corporate kind. Tickets were scalped for the five-course event; ties were knotted, stockinged toes slipped into high heels. Taking their seats at the candlelit University Club, the students were treated to a cautionary clip from Titanic: Jack confronts the cutlery. "And," quipped one, "we all know what happened to Jack." For two hours, restaurateur and wine expert Clark Day coached them through soup, pasta and the entrée, straight through the salad course and on to profiteroles. With patience and humour, he deconstructed the art of fine dining: the salad fork's connection to the dinner fork, and so on. When a plastic bug was slipped into one woman's meal, she won full marks for poise. "You will be in a restaurant," warned Marilyn Shurtleff, career adviser to her commerce charges. "Something will happen, not to your liking, and you must know how to handle it."
Of course. Manners are the grace notes. But make no mistake: when it comes to capturing a hot business grad from the UNIVERSITY OF WESTERN ONTARIO or Queen's, or a high-tech turk from WATERLOO, the UNIVERSITY OF BRITISH COLUMBIA or NEW BRUNSWICK, a minor dinner-table transgression is unlikely to spoil the appetite of most corporate callers. From McKinsey to Microsoft, Goldman Sachs to Nortel, they are courting with a vengeance. Even as Shurtleff played Dolly Levi to her graduating class, grooming them for the fall matchmaking season, she was well aware that recruiters had been sneaking in the back door all summer, sending flowers, with handwritten notes. "We know you have many offers," they gushed, "but we hope you'll keep us in mind." Long before signing bonuses and stock options made it to the table, the corporate loot bags had begun to arrive - elaborate care packages at exam time, leather-bound photo albums to commemorate a summer work stint, Palm Pilots and Mont Blanc pens.
The message is clear: for the class of '99, it's a shopper's market - and a global one at that. "Human assets are the capital on which corporations now compete," says Roger Martin, the newly minted dean of the Rotman School of Management at the UNIVERSITY OF TORONTO, formerly a worldwide director of the strategy consulting firm Monitor Co. "There is a war for talent, and the battle for certain people is white hot." Michael Bloom, principal research associate at the Conference Board of Canada, agrees: "It's not all roses. But when your skills match up, you're part of the elite - and you're laughing."
If there's a war for talent, campus recruiting has become a primary battleground. Without a doubt, cross-border shoppers have upped the ante. Shrewd eyes from Silicon Valley, major investment banks and strategic consulting firms are all targeting Canadian campuses. In the past three years, the campaign for the best and the brightest has revolutionized the recruiting game. Companies are cherry-picking students in first and second year, launching co-op programs and internships as a pivotal part of their recruitment strategy, breeding loyalty as early as possible. In corporate jargon, it's all about branding: raising the profile, and reinforcing it on a regular basis with leadership conferences, wine and cheese parties, guest lectures and e-cruiting drives. "Our company is well branded in Canada," says Rosemary McCarney, vice-president of workforce strategy for Nortel Networks, Canada's flagship high-tech firm. "But we don't take it for granted. We do a lot of research on understanding the triggers that cause people to join us."
What tops the list? Not money. In McCarney's parlance, the first priority is "killer apps." Translation? Killer applications for the high-tech worker; challenging case work for the commerce grad. "In other words," says McCarney, "they want to be at the bleeding edge." Last month, Ashish Kapur, a 21-year-old electrical engineer and one of the co-founders of Corporate McGill, a student-run consulting company, hosted an information session for 20 multinational companies, including McKinsey & Co., Andersen Consulting and Petro-Canada. The aim was to educate the employers on students' prime decision factors in choosing a job. Their priorities, from top to bottom, were: interesting co-workers, challenging positions, career advancement, training and good salaries.
Ka-Ping Yee would have no quarrels with that pecking order. Raised in Winnipeg, Yee was a member of the three-person superstar team from Ontario's University of Waterloo who won the Association for Computer Machinery International Collegiate Programming contest in 1994. As a Waterloo student, he did co-op placements in Japan with Alias/Wavefront, in Toronto with Alias Research, in Montreal with the Canadian Space Agency, and with Xerox in Palo Alto, Calif. When Yee hit the market last year, the competition was stiff. He had several cold calls from Canadian and U.S. companies, as well as five solid offers. One American stock-trading firm went as high as six figures. He turned it down. Microsoft was at his doorstep, but Yee, then 22, was unimpressed: "I wanted to be proud of the software I produced. Office 2000? I was going to have to be making excuses for it."
Instead, Yee applied to be a production software engineer with George Lucas's Industrial Light & Magic in Marin County, Calif. One year later, he is part of a five-person troubleshooting team, helping artists solve problems with graphic software effects on such films as Star Wars: The Phantom Menace and The Mummy. "ILM was not the highest offer, not by far," says the soft-spoken Yee. "But this is deeply creative. I'm surrounded by artists." And while he misses Canada, he confesses that California is "exhilarating." "For technical people, it's like nowhere else," says Yee. "A large fraction of all the people you want to meet are all here."
And a large fraction have been wooed from other countries - for good reason. In 1990, U.S. schools were graduating 17,000 fewer students in computer science than in 1986, a drop of 40 per cent. And as a growing number of diverse industries demonstrate a need for high-tech talent, the shortfall has grown ever more urgent. As many as 250,000 new high-tech jobs are being created annually in the United States. Richard Meissner, director of permanent recruiting at United Staffing Systems in Manhattan, estimates that there are 10,000 unfilled positions in New York City alone. "Bonuses have skyrocketed to 150 per cent of salary," says Meissner. "And companies have had to lower the bar. One guy had a manslaughter charge and the company looked right past it."
This summer, software engineer Mark Derbecker is heading to work for Microsoft in Redmond, Wash., with as many as 18 of his Waterloo classmates. All were bombarded with calls and gifts this year; many were jetted, often with their partners, for interviews across North America. In the end, Microsoft offered Derbecker twice as much as any of the Canadian competitors, plus stock options and a signing bonus. "Those who are staying here in Canada are doing so largely for family reasons," says the 24-year-old native of Woodstock, Ont. "They don't want to leave home." Still, Derbecker adds wistfully, "I'm going to be glad that I have a brother in Seattle."
Rotman dean Martin, a keen observer of global recruiting, calls Silicon Valley simply "the most competitive market on the face of the planet, a place where everyone's an executive recruiter." What he's referring to is the well-established practice of paying current employees for tips leading to a successful hire. For the past 10 years, Nortel has been paying referral bonuses as well: $4,400 for hard-to-hire strategic positions, $2,200 for more traditional jobs, and $730 for the lower-paying ranks.
But if the high-tech sector is the most aggressive market, business runs a close second - thanks in large part to the voracious appetite of global consulting firms and investment banks. Those concerns have upped the ante in a significant way, both in terms of compensation and opportunity. When Martin opened the Toronto office of Monitor in 1987, he discovered that the Canadian employees of a major international consulting firm were earning 40 per cent less than their peers in New York and Chicago. Martin began paying a North American salary, and all others have followed suit. Starting salaries for recruits with commerce degrees run between $60,000 and $75,000 - plus signing bonuses. But for the new grad, the attraction is more than fiscal. Recruits are immediately put on teams, working with challenging clients, upgrading valuable, portable skills.
Jonathan Goodman, a worldwide director of Monitor and head of its Canadian operations, says his firm fields over 2,000 résumés a year. On average, it hires 10 undergrads. Where does he shop? "We're getting the top of the class at Queen's, Western, McGILL and CALGARY. Strong people from Waterloo, WILFRID LAURIER, Ecole des Hautes Etudes Commerciales and U of T." Where else? "Queen's engineers, urban geographers from Western, UBC political science."
His competitor Bain & Co. is shopping in similar circles. Managing director Joe Shlesinger says that of Bain's 20 annual new hires at that level, 25 per cent come from Western's Richard Ivey school of business honours program, 25 per cent from Queen's commerce, 25 per cent from U.S. schools and the rest from across Canada, including engineers from Waterloo and Toronto. Bain assigns a manager and a partner to act as "team captains" for recruiting at each school, a job Shlesinger deems as "almost as important as client work."
And no wonder: the field is getting crowded. This year, one prestigious consulting firm flew two third-year Queen's commerce students back from their exchange studies in Europe - just to interview them for summer jobs. Meanwhile, the Los Angeles office of Donaldson, Lufkin & Jenrette, a New York-based investment bank, has been recruiting at both Queen's and Ivey, hiring for their summer program. "Up to five years ago," says Goodman, "you would have had to be an extremely industrious person to get a summer position like that. Now, DLJ is right on campus. This is a great story for undergrads - not necessarily a great story for Canada." And although the salaries are set globally, Shlesinger quips: "There is no way I can equalize for tax."
In certain corporate quarters, that personal tax differential is no small concern. Last week, Nortel CEO John Roth warned that his company would have to leave the country if Ottawa refuses to ease the tax load, saying that he is losing as many as 500 engineers a year to U.S. competitors. Many Canadians agree with Roth, seeing taxes as a major strategic hurdle. According to Bloom at the Conference Board, the number of Canadians on temporary work visas in the United States quadrupled between 1990 and 1996, rising to 40,000 from 10,000.
George Hunter, executive director of the British Columbia Technology Industries Association, is crying foul: "I don't give a damn what Mr. Chrétien and Mr. Martin say - the brain drain is real. A young person can drive 40 minutes south and earn twice as much take-home." Martha Piper, president of UBC, is more sanguine. "Here, in the Northwest corridor, living with the Microsoft phenomenon, we're very aware of being poached," says Piper. "But it's a world issue. We're operating in a very fluid global market. We should be building bridges, not barriers."
Perhaps Piper and Hunter are both right. In the face of intense competition, the smartest are building bridges to the community at large. Hunter reports that B.C. companies have increased their outreach to Canadian students through co-op programs, and are striving to create employee-centred work environments. Meanwhile, Piper has vowed that by 2003, every faculty and school at UBC will have developed co-op options. Teri McNaughton, head of recruiting for PMC-Sierra Inc., a Vancouver-based firm that designs chips for the Internet, targets first-year students, visits campuses at least every two months, and participates in virtual job fairs to keep the company's profile high.
That sort of effort can have a powerful effect in winning a student over. Take Martha Lawrence, 21, who just graduated from Acadia University with a bachelor of business administration and a 3.96 average. Lawrence set her sights on IBM after meeting the company's Canadian CEO, John Wetmore, on campus two years ago. And IBM's funky ads for e-business captured her heart: "They had a big effect on me. The company looks cool." Next month, Lawrence will head to Toronto, starting work as an information technology specialist in IBM's e-business services, earning more than $40,000 a year. "I want the resources of a big company," says Lawrence. "A friend is enrolled in the IT program at Sheridan. She has to shell out to learn. I don't."
What all this means is that the ball is now in the students' court. "This is a sea change," says Martin. "These kids can smell it, and feel it. The power dynamic has shifted." And the bright students understand exactly what business guru Tom Peters means when he stresses investing in "the brand called you." Veterans of the so-called shrimp wars - the on-campus corporate information evenings - they are looking for challenge, opportunity, learning and growth. Most of all, they want to make sure there is a personal fit. These students want to be able to kick the tires of a company, through summer work, co-op or internships, before they commit.
For that reason, experiential learning has become a hot-ticket item. Between the 1990-1991 academic year and 1997-1998, the number of co-op placements for university students rose 64 per cent, to 40,366 from 24,581. The University of Waterloo, the largest co-op educator in the world, now has 10,000 students in placements in 80 academic programs. Six months after graduation, those who have had co-op experience are earning 14-per-cent more than their peers in the same program. Cindy Dunne - former head of corporate campus recruiting for Bell, then director of resources at CIBC - is now launching a co-op program at BROCK UNIVERSITY in St. Catharines, Ont. "For an employer, co-op reduces the incredible cost of recruiting off the street," says Dunne. "But it's also part of the long-term plan to indoctrinate a student. Through training, you build loyalty."
CIBC has been using student programs as part of their competitive recruiting strategy. According to Uli Wiemer, leader of campus and intake programs, CIBC has launched various programs to boost both its feeder pool and its visibility with top students. Last summer, it started the Branch Banking Student Internship program, a four-month learning opportunity. "Co-op is more like dating than marriage," says Wiemer. "Their impressions as to whether you are a good employer, whether your products are sexy and competitive, are critical. You just can't expect to show up at grad time and get first dibs on the best students."
By anyone's standards, Brenda Ha is a hot commodity. At 22, she is part of the elite and heavily courted class of Queen's commerce '99. Savvy and articulate, she made her choices carefully, watching as the companies came calling. Last summer, she chose to attend a student leadership conference in St. Charles, Ill. Hosted by Andersen Consulting, the four-day event was held on the leafy campus of a former college. Days were spent in workshops, honing presentation skills, interview techniques and teamwork. There were outdoor recreational courses, seminars on Stephen Covey's habits of highly effective people - and frequent opportunities to speak to junior employees of the firm. "They were really focused on building me," says Ha. "And there was no hard sell."
Last fall, when the hard-sell season began, Ha received cards, letters, gift baskets and dinner invitations from dozens of companies. One card read: "We really value you. Please make the right choice. And please think about the offer." In the end, it came down to a decision between two: working with a small start-up tech firm that is, in her words, "going to be seriously successful," or signing on as an IT consultant with Andersen. After asking for an extension to make up her mind, she chose the latter, in part because of the conference experience. "So many companies look good on paper, but you have to see whether the culture will be a good fit," says Ha. "Andersen invests a lot of time and money into excellent training - and I feel they are going to invest in me."
If recruiting is courting, hiring is more like marriage - and relationship-building is what it's all about. Like Ha, Joan Michener Schatz was a prize catch this season. At 31, she had worked for Trimark and the Toronto Dominion Bank, and was graduating with an MBA from Toronto. Articulate, poised and bright, Michener Schatz had set her sights on Monitor. She was attracted to the culture, the work and the people.
Last October, after a gruelling round of interviews, including one day-long session where she was grilled by five different Monitor executives, Michener Schatz was offered a coveted position as a consultant with the firm. But she had a secret: days earlier, the married student had discovered she was pregnant. In good faith, she called Jonathan Goodman, saying that the circumstances might change the company's interest in her. Goodman responded with one word, "Congratulations." He then encouraged her to attend the eight-day training session for all new worldwide recruits in Cambridge, Mass., this August - and welcomed her baby as well. Michener Schatz, who just finished writing her last exam at a professor's house because it conflicted with her prenatal class, is uncertain whether she will tow along her baby, due in July. But Goodman's reaction cinched the deal. "It told me that this really is the company that I want to work for."
Her dean, Roger Martin, is not surprised at the outcome. "Listening to people and working with them productively is what the business is all about," he says. "Joan is unusually gifted with people. She has an ability to listen in a very sophisticated way. And that is incredibly hard to teach." All of which makes her enormously desirable in 1999. "You know," says Martin, "if you asked a CEO in the 1950s to make a choice between having his bank accounts emptied, his factories burned or his employees killed, he would have said, 'It's sad, but kill my people.' Today, the answer would be, 'Burn my factories, take my money. But whatever you do, don't touch my people. Without their talent, I am nothing.' "
Voting With Their Feet
Programmatic growth in university enrolment between 1994 and 1997:
General Arts and Science: 6.0%
Computer Science: 32.3%
Electrical Engineering: 4.9%
Other Engineering*: 61.7%
*includes biomedical, computer, petroleum and geophysical engineering
Maclean's May 10, 1999