Want to hire the best minds? Turn to start-ups. That’s what Walmart Labs India, a captive unit of the world’s largest retailer Walmart, plans to do in the country — by using a relatively new recruitment concept called AcquiHire. This is a combination of acquisition and hiring, where a large firm snaps up a start-up solely for its talent, showing no interest in its products or services.
Globally, AcquiHiring has been used by large companies, including Walmart itself, to get talent in a new domain. For instance, in the US, Walmart acquired ecommerce company Jet.com in 2017 because this start-up’s employees understood the urban millennial consumer mindset really well. Walmart needed this skill to take on Amazon better.
However, in India, Walmart Labs will use AcquiHiring with a slight twist — it will not take over the entire company. Rather, says Sudeep Ralhan, Senior Director, Human Resources, Walmart Labs India, it will tap a team within a start-up having a specific skill-set.
Walmart Labs India plays a critical role in developing technologies and applications for Walmart. For instance, the core of Walmart’s Global Logistics Services is built at Bengaluru, and deployed in 28 countries where Walmart operates and ensures efficiency along its supply chain. The lab also drives eCommerce for four different countries and Walmart’s Sam’s Club business.
The lab uses different hiring channels, including referrals that constitute about 30 per cent of its hiring. “But the most interesting part that we are experimenting is AcquiHire where we are talking to existing teams in start-ups and how they can come on board and work with us directly,” says Ralhan.
According to Ralhan, the process of AcquiHiring has begun. “Over the next few months, we will get teams on board through the AcquiHiring route. Since this is the first time we are doing it, we are excited about it.”
It has partnered with recruiting platforms and firms that leverage technology to help understand the start-up ecosystem and accelerate AcquiHiring, he says.
The team from the start-up will join Walmart Labs on its rolls and bring certain specific skill-sets. For example, if there is a start-up focussing on home shopping in Mumbai, they understand local buying patterns, consumers and supply chain. This could be one kind of domain expertise that Walmart could use. The other skill-set would be on data as Walmart has 260 million customers and 2.5 million associates and data is a huge priority. “We will acquire skill-sets of data analytics or data sciences through AcquiHiring,” says Ralhan.
Till now, Walmart Labs had hired employees the traditional way, several from large services companies. With the talent from AcquiHiring, the mix can be fantastic in terms of the kind of various skill-sets and mindsets that they bring to the table. There are people who understand scale and complexity; and there are people who have worked in a start-up environment — bringing them together is the recipe for innovation, says Ralhan.
The lab started in 2018 with 1,300 employees and will close the year with around 2,400 people . “Instead of figuring out ourselves we would rather partner with somebody who is in the ecosystem and help us navigate that and the right kind of opportunity and we will take it from there,” he says.
Pros and cons
AcquiHiring is all the rage today to recruit specific skill-sets.
However, according to Prasanth Nair, Managing Partner and Country Head, InHelm Leadership Solutions, AcquiHiring needs to be done carefully as it carries a few risks.
Pros: Helps scale up fast and get the needed skills
Cons: Chances are the team hired is not integrated into the organisation and team working suffers
At times they leave for the next opportunity together, in which case it is a business risk.
Ways to make AquiHiring smooth
1. HR should facilitate bonding between those hired and earlier employees
2. Have payment linked to their staying for a specified period
3. Spread the hired team to different units if possible. Let them not be seen as ‘another’ team