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Thursday, March 12, 2015

Could Your Staffing Firm be a “Burning Platform?”

The agency temp model has been the tried and true mainstay of the staffing industry for many decades.  The client needs a contingent worker, the staffing firm finds and supplies the right one while serving as employer of record.  The machinery for executing this process has not changed that much—automation has been introduced to optimize here and there—but all the basic steps have remained the same, like an old dance that everyone knows and loves to do.

Or maybe not everyone is loving it:  dances change over time—for example, from a minuet to a hot cha-cha-cha.

And staffing firms may be starting to feel the heat these days.  BLS data suggest that a cyclical peak may have been reached heading into 2015, perhaps signaling an end to the “post-recession recovery temp staffing party.” 

But deeper changes may also be at work.  Staffing Industry Analysts recently published these staffing firm survey results, indicating that even some large percent  of staffing firms were expecting to generate less revenue from conventional temporary help services and more from SOW and online staffing.

Other studies, including one by Ardent Partners, basically mirror these findings--except they anticipate changes occurring within a shorter time frame (in coming years, not over the next ten years). 

The bottom line is that the staffing business is changing—service models and processes are changing with technology and changes in client/candidate expectations and behaviors. 

Most staffing firms and analysts have been mesmerized by one new, fast-growing services model called  SOW.  But SOW is just the first visible signal of changing models—it is not the end-all.  At the same time, SOW is showing many staffing firms how difficult it is to adopt and perform new service processes and delivery successfully to customers with new business models (e.g., for fee by completed project vs. a % of ongoing temp billings). 
More changes are coming, including “workers on-demand” and “specialized, short-burst talent-as-a-service.”  Customers and candidates want to engage in processes that offer them control, visibility, and speed (patience is waning for the service time frames and practices of traditional middlemen). 

Staffing firms that are fully locked into their traditional temporary help business models, processes, and technology may not be able to change and adapt to new processes and models as demand for temporary help services begins to recede in favor of other workforce services and solutions.  For firms like these, the flames may not be visible and there may not be any smell of smoke, but their businesses may be turning into “burning platforms.”

The way to avoid becoming a “burning platform” is to start making small changes and to start innovating NOW—begin to introduce new digitized processes and service offerings.  This does not mean that you should shift your focus away from your core business and try to substitute a new innovative one.  It means that on a small scale you should start making changes, getting accustomed to changes, trying to make changes work (some will, some won’t).

NextCrew is the ideal platform for pursuing this process—complete with capabilities that can be used to digitize and start to transform the way you engage with clients and candidates and how you deliver your staffing services to them.  It is economical and easy to deploy, complementing and integrating with your existing technology.  Moreover, you control how much and what change you want to try, and the NextCrew platform will support your doing so.  NextCrew even offers pre-developed service processes and models for you to try out (like Talent Showcase, Private Talent Pools, et al).

Closing questions:  Are you and your staffing firm going to be doing the same things you've done for years when the music starts and there is smoke rising in the air?  Or are you and your business going to face the music now and start to dance?  

 Guest Blogger, Andrew Karpie, is Principal Analyst at The Research Platform and a recognized expert on emerging online work intermediation platforms as well as their impact on the staffing industry.  Over the past three years, he has produced and published numerous research reports and articles on these subjects with Staffing Industry Analysts.  He has also produced research and published content for a number of major staffing firms and online staffing platform businesses, and he serves on the Advisory Board of The Rise of the Platform Economy research program, a joint initiative of Stanford University Business School and The Center for the Global Enterprise.  Andrew holds an MS in Policy Analysis from Carnegie Mellon University, and he lives with his family in the San Francisco Bay Area.

Tuesday, March 10, 2015

Will You Be A Hybrid Staffing Firm?

Do you remember when you saw the first Prius?  

Let me prime you your memory with some facts from Wikipedia:
  •  The Prius was introduced worldwide in 2000.
  • Global cumulative Prius sales reached the milestone 1 million vehicle mark in May 2008,] 2 million in September 2010, and passed the 3 million mark in June 2013.
  • The Prius family reached global cumulative sales of 4.8 million units by September 2014, representing 67.7% of the 7 million hybrids sold worldwide by Toyota Motor Company since 1997.
Today, almost every automobile manufacturer sells hybrids:

There are even hybrid trucks and buses today!
Why has this happened?  “Value to customers.”
Customers didn't want “a gasoline combustion”  ride.
They wanted a ride that was economical and sustainable.

Staffing customers are no different. Staffing customers want value, and they expect their suppliers to deliver it. 

Staffing customers want:
·         The right labor/talent when they need it.
·         Low overhead (cost and cycle time) in getting it
·         Control (they want to step on the gas and get the performance)

Many staffing firms have been trying to meet customer expectations by putting their “pedal to the metal” and driving up RPMs to unsustainable rates.  They have not stopped to think about innovation (the way Toyota did some time back). 

Tried and true “staffing engines” can only be driven so hard, can only perform so far.  Innovation is the answer to getting to the next level… “Jumping the curve,” as Guy Kawasaki said at the 2014 SIA Executive Forum.

NextCrew is a platform that will allow a staffing firm to pursue an innovation path.  Starting with the basic development of a Talent Showcase, expanding it to a customer’s private Talent Community, or unleashing the power of an online marketplace and self-service for customers and candidates—

NextCrew is an engine that that can transform a gasoline-only-driven, commodity staffing supplier into a multi-dimensional workforce solution provider that can meet customer needs for staffing/workforce in many more ways than the traditional staffing model allows.

Hybrid cars have two engines—the gasoline one, and the electric one.  For “hybrid” staffing firms it is similar -- they have their traditional “agency temp” engine and the new electronic engine of NextCrew that can perform for customers in ways that meet new needs and do so in highly efficient ways. 

NextCrew is the second engine and the enabler of the next generation of hybrid staffing models.  And the future of staffing is hybrid:  the temp agency engine will run on, and the electric engine will run in tandem, delivering new innovative workforce solutions to customers.

As more and more hybrid staffing firms appear on the road, providing customers with the cleaner and more efficient rides they want, where will you be?

Will you be left behind?  Or will you be racing ahead?

Contact us today to learn more! 

 Guest Blogger, Andrew Karpie, is Principal Analyst at The Research Platform and a recognized expert on emerging online work intermediation platforms as well as their impact on the staffing industry.  Over the past three years, he has produced and published numerous research reports and articles on these subjects with Staffing Industry Analysts.  He has also produced research and published content for a number of major staffing firms and online staffing platform businesses, and he serves on the Advisory Board of The Rise of the Platform Economy research program, a joint initiative of Stanford University Business School and The Center for the Global Enterprise.  Andrew holds an MS in Policy Analysis from Carnegie Mellon University, and he lives with his family in the San Francisco Bay Area.

Tuesday, January 6, 2015

Staffing Industry Transitions in 2015

In 2008 many staffing businesses began to feel the pressure of the economic down turn that started with the collapse of the subprime mortgage industry in 2007. Some agencies may have even been working with these types of companies and felt the effects immediately. Over the last 7 years, the economy has improved and staffing, as always, has been at the forefront of that change. 

Staffing, as we all know, is an indicator industry. When staffing picks up, other businesses can expect growth as well. It makes sense. Companies are less confident about their hiring options since many had to go through several rounds of layoffs as the recession hit. Staffing becomes the perfect answer.
While the economy has been slow to recover this time, the important take away is that it is recovering and temporary staffing, of all varieties, is riding the crest of that wave. 

Let's take a look at some of the numbers from 2014. 

  • Unemployment at 5.8%: as of November, the unemployment rate was holding steady at 5.8%, the lowest since May, 2008.
  •  Payroll increases: According to the same Department of Labor report, wages have increased by 9 cents in November. This is a difficult stat to track since wages are so reliant on location, production, and experience. 
  •  Increased staffing index: In 2006, the American Staffing Association launched an index to track the growth of the staffing industry. It was set at 100 when it was released and during the recession dipped as low as 66 in 2009. In 2014 it remains comfortably above 100.
  • 11 million temporary employees: Back in 2013, the staffing industry reported that it had hired over 11 million temporary and contract employees across all specializations.
  • Sales at $122 billion: In the same report, the ASA indicated that staffing sales had also reached an all-time high.

So, what's in store for 2015? 

The staffing industry is continuing to experience growth and at the same time technologies are changing the game to allow for more opportunities including online staffing. What can you do to keep the momentum for the New Year? 

  1. Consider online staffing: Offering the ability for your pool of candidates to connect directly with hiring managers can bring in more revenue this year.
  2.  Streamline technology: Automating processes, connecting current systems, and allowing candidates and clients to have access to self-directed portals can also increase your company's ability to source and place talent.
  3. Improve on-boarding procedures: It is currently believed that up to 20% of new employees will quit before their first 90 days is complete. This is a horrifying statistic and many businesses are turning to staffing and temp-to-hire options to help with the onboarding process. Your business can become a bridge to success for both clients and candidates.

Take your staffing business to the next level today! 

NextCrew can help you customize online staffing solutions and better technology integration for your specific business needs. Contact us today!  

Image by wackystuff via Flickr

Saturday, January 3, 2015

Staffing firms, don’t be confused -- NOW IS THE TIME to begin your Online Staffing journey!

Guest Blogger, Andrew Karpie, is Principal Analyst at The Research Platform and a recognized expert on emerging online work intermediation platforms as well as their impact on the staffing industry.  Over the past three years, he has produced and published numerous research reports and articles on these subjects with Staffing Industry Analysts.  He has also produced research and published content for a number of major staffing firms and online staffing platform businesses, and he serves on the Advisory Board of The Rise of the Platform Economy research program, a joint initiative of Stanford University Business School and The Center for the Global Enterprise.  Andrew holds an MS in Policy Analysis from Carnegie Mellon University, and he lives with his family in the San Francisco Bay Area.

The trend toward the use of “contingent workforce” is clearly on the rise.  In 2012, per Staffing Industry Analysts, the worldwide staffing industry supported spend of about $350B on just “temporary staffing” contingent workforce, and the total global contingent workforce spend numbers (including SOW, ICs, freelancers) was several multiples larger.  There are now numerous forecasts that point to on-going growth in contingent workforce in future years, and it is not uncommon to find growth rates of 10% or more.  Certainly, this continuing growth is being driven by a number of factors, including the development of new ways of procuring and providing contingent workforce in different forms (i.e., not just continuing to do things only in the same way as was done before).

Over the past three years, my research and analysis has been highly focused on the emergence of so called “online staffing” and other “human cloud” platforms--and their development alongside and within the established staffing industry.  While many in the staffing industry have reacted to online platforms with concerns about “disruption,” I have tended to expect the impact and change to more of a “transformation” of the industry, as more and more staffing firms adopt “digital platform models” in some way and use them to innovate their staffing business models. 

In the past year, I developed the Staffing Industry Analysts 2020 forecast of the aggregate worldwide contingent workforce spend that would be enabled by “online staffing” types of platforms (whether they were platforms of new, free-standing platform-based businesses like Elance-oDesk, Field Nation, etc. or they were “digital platforms” that staffing firms adopted to innovate and evolve in different directions from the traditional staffing business model). 

In one article about that 2020 forecast (which ranged as high $46B in “online staffing-based spend”), I shared my perspective on how “online staffing” and the established staffing industry might “co-evolve:”

“To forecast to 2020 and create a few plausible scenarios, we considered a range of potential drivers and constraints,” …“It’s hard to build anything other than expansive scenarios. The big questions seem to be how fast, in what forms and to what extent. I think two of the big wildcards here are the pace of larger enterprise adoption and to what degree staffing firms (and managed service providers/vendor management systems) start to adopt and leverage these models. By 2020, my guess is that the staffing business will be much more hybridized, similar in some ways to what happened with retail and online shopping.”

What I say in the last sentence about “hybridization” means two things (and refers to the retail industry as an analogy).  First, I mean the staffing industry will become more of a (hybridized) mix of different types of firms (so just as in retail today you find Amazon and Walmart, in staffing you will find something like an Elance-oDesk and a Manpower).  Second, I also mean that established staffing firms will adopt and adapt online staffing platforms into their own businesses (so just as today, Walmart and most retailers are also online, in the future most staffing firms--that are successful—will also have leveraged and integrated online staffing platforms into their business models). 

So in the future, many of the successful staffing firms will likely be “hybrid” staffing firms.  That does not mean that they will stop being staffing firms (doing some part of their staffing in the way they did before) or that they will start offering “wild west” open marketplaces that leave clients and themselves open to compliance and other risks.  What it really means is that staffing firms will appropriate and leverage digital online platforms to expand and innovate their businesses in many directions. 

Certainly, it is conceivable that a staffing firm in the future will offer its clients access to “online workers,” but those workers will be vetted and classified and paid properly just as they would be today.  By adopting and starting to leverage digital platforms, staffing firms will gradually discover that such models open up all kinds of innovative opportunities for serving their clients’ changing needs, improving staffing firm cost structure and service performance, attracting new worker populations in different ways, and most likely creating new revenue-generating lines of staffing services, etc. 

For the purposes of this blog post, it is important to make the point that successful staffing firms of the future are likely to be “hybridized” firms that have managed to leverage digital platforms to innovate their business models and services in a variety of ways, depending upon the staffing segment, the firm strategy, etc. 

At the beginning of this post I said that claims of “online staffing” suddenly “disrupting” the established staffing industry seem to me to be over-blown, and I have discussed what I foresee as an evolutionary process of “transformation” and “hybridization in the years to come. However, “transformation” and “hybridization” are not just buzzwords, they describe real, active developments and changes that have already started in some staffing firms today and will continue to develop in more and more staffing firms in future years. 

It is critical for staffing firm owners/executives, therefore, not to just think, “Ok, no disruption, just transformation…  I can relax, I’ll just sit tight and wait out the storm.”  That attitude could underpin a superlative strategy for “being left behind,” while other staffing firm competitors innovate and outflank you. 

I can assure you: “the time is now” to get started, to begin learning, and to put the investment of time into figuring out how to best innovate your business using a digital platform and keep your business at the front of the competitive pack. 

A recent report by research and advisory firm, Ardent Partners, (“The State of Contingent Workforce Management: The 2014-15 Guide for Managing Non-Traditional Talent”) reveals some eye-popping data from its survey of contingent workforce buyers.  Ardent asked those surveyed about what would be a source of contingent talent now in 2014 versus what would be a source in 2016.

  • 88% said Traditional Staffing Suppliers/Agencies for 2014, but for 2016 that % was only 78%! The way I interpret this is that fewer survey respondents (78%) will regard Traditional Staffing Suppliers as a source of contingent talent in 2016 than in 2014 (when 88% of the respondents consider Traditional Staffing Suppliers as a source).
  • Alternatively, it seems the use various “non-traditional” sources of contingent talent would be increasing -- for example, “Private talent pools/“known” networks [2014 45% versus 2016 61%] and Online labor marketplaces/freelancer networks [2014 23% versus 2016 46%].

Clearly, as the use of contingent workforce by businesses increases, change and innovation in procuring and providing contingent workforce “is happening now.”  Online staffing platforms are already beginning to transform the established staffing industry, and savvy innovative staffing firms are already taking actions to respond to these changes (figuring out how to innovate their businesses and compete and grow using digital platform-based capabilities).  These are the firms that are on their way to becoming the “hybridized” firms in what will be an increasingly “hybridized” staffing industry. 

To make this shift and not be left behind, it is important to start right now by adopting and starting to use an online staffing platform and beginning the learning process to eventually understand the best ways for your own staffing business to leverage this high-potential tool set with your target clients and workforce and find better, innovative ways to serve them both and stay competitive in the staffing game.

Monday, December 15, 2014

Does "All in One" Software Solution Really Exist?

We spoke with a client recently who is looking for one system to handle everything: their applicant tracking system (ATS), customer relationship management (CRM), payroll, and workforce management. This got us thinking about whether or not an all in one system is really the most effective solution for staffing services. 

Instead, companies can create an ecosystem of applications which all communicate and are individually good at what they do. 

Our systems are designed for the staffing industry. Within this industry no one company provides every possible type of talent. Rather, staffing companies specialize in their own industry to maintain integrity and expertise. A light industrial agency isn't going to recruit for locum tenens doctors. Recruiters are trained to source candidates within their own vertical so they can remain focused. This becomes the most effective and efficient way for staffing providers to service their client's needs. 

The same is true for technology. 

While it sounds like the easiest solution an "All in One" system may not be the best. Rather than purchasing a system that doesn't do any one thing well companies should consider having multiple systems, each the best in their specialization, which can integrate with one another for smoother business operations. 

For example, cell phones are changing the way we individually use technology. With just your phone you can connect to the internet, take photos, store music, and make phone calls. However, it has limitations. Some websites are not optimized for the small screen of a cell phone so users may need access to a desk or laptop computer for certain needs. The phone's camera, while excellent, is not professional quality. If someone wishes to take the best photos possible they will still need to invest in the top end DSLR camera.  And all of this tech can communicate with one another. A photographer has the option to upload their photos to a computer and use separate photo manipulation software to improve the raw images. Each of these components is integrated, but not all in one.
As the owner of a staffing company you are proud of the specialized service you provide to your core clients. Why not work with a series of systems that can each provide the same level of service for your organization? 

NextCrew offers a robust online staffing platform which can allow companies to connect different components to create a powerful ecosystem. It can also facilitate online staffing business models which can work in multiple staffing verticals. Our system fluidly integrates ATS, payroll, invoice management, vendor management systems (VMS) and more to bring efficiency to your organization and offer new opportunities for revenue streams in the world of online staffing. Contact us today to learn more! 

Tuesday, December 9, 2014

Online staffing is not one-size-fits-all

Whether a staffing service has been in business for five, ten, or over twenty years it is clear that they will establish a certain set of procedures that work for their staff, clients, and candidates. Having ways for your company to stand out from your competition is essential and everyone strives to provide the very best customer service and job placement. 

Then online staffing comes along and threatens to shake up the very core of the industry. Now, recruiters don't need to be the middle step between clients and candidates and this can sound a little scary for a company who has spent years developing and training their recruiting staff to provide exemplary service. But online staffing doesn't have to be that way. If you're considering implementing this change in your company it is important to realize that you don't have to completely overhaul the way your business currently runs, you can simply enhance it. 

Online staffing is not one-size-fits-all.  

Over the last decade online retail and digital communications have dominated the marketplace. When companies like Walmart began to offer online services to their shoppers they didn't change their current model. Many people who are part of their target demographic still prefer shopping in the store but the number of shoppers utilizing the online services is growing. In 2014 the online shopping business grew by 30%.  Even more startling is the fact that 95% of potential Walmart shoppers will research their purchase online before going into the store to buy it. It is important to note here that Walmart didn't change their business model but they provided additional options as their target demographics began to change their shopping habits. 

Both your clients and your candidates are changing with the digital age. In 2014, 87% of American adults use the internet to get their news, connect with friends and family, and apply for jobs. This is a huge jump over 2005 where only 66% were online. Staffing companies need to follow their candidates and offer online tools and ways to digitally connect to reach the audience they are targeting. 

The digital age is changing the way clients interact with their vendors as well. There are multiple direct web services that connect freelancers to the people who want to hire them. This is beginning to leave some staffing services out in the cold. By providing online options it allows staffing companies to cater to their customers who want high-touch and hard to find talent as well as a high volume and on-demand workforce.

If your company is considering the addition of online staffing services over the next few years the best way to get started is to implement a workforce management system. This will allow you to enhance your services later in a seamless, integrated manner. You will be able to transition to forms of online staffing that fit your business model and your clients' interest.

For more information, check out our post about some of the reasons better workforce management may be needed to stay competitive in the current market. 

Are you ready to explore an online staffing business model which works for your business? 
Contact NexCrew today!  

Image by Bruce Guenter via Flickr

Tuesday, December 2, 2014

Efficient Workforce Management: A Step Towards Online Staffing Business

We talk with a lot of companies who have considered making major changes in their office technology. Most companies within the contingent staffing industries have heard of workforce management and even on-line staffing. Many even love the idea and agree that this is the future of staffing. But for multiple reasons companies sometimes stop short of implementing these changes in their business for a variety of reasons including: 
  •  A fear of change
  • The high cost of a new system
  • Leadership decisions
  •  Issues with current systems not communicating
  • Uncertainty of where to start.

Companies who may not be considering entire online staffing systems who are still using older technology or even manual systems to keep track of their talent may be interested in learning that workforce management tools and online staffing are simpler solutions when working with the right vendor. 

A better workforce management system for the 21st century is not only necessary for efficient work processes but it can take even the smallest staffing businesses to the next level. It can allow for companies to provide more value added services and increase their own profit and viability in the marketplace. 

Online staffing is about hiring and sourcing talent online. Businesses utilize online systems to source their own talent and making hiring decisions. Why allow your competition to have the corner on this market when integrating an online staffing program may be as simple as upgrading your current database and workforce management system. Your company can facilitate these transactions allowing your employees to work more and your company to generate more revenue. 

A new workforce management system will allow your company to:
  1. Standardize your processes
  2. Engage and communicate better with your pre-screened talent pool
  3. Allow for the scalability of your business
  4. Provide better service to your client base
  5. Project trends based on the information in your system
Workforce management is the foundation for offering various online staffing business models.  

If you work with a contingent workforce, NextCrew can help you analyze your current system, vision, and client base to determine how to position your workforce management technology to take advantages of the opportunities knocking at your door. Are you ready?