Best Operating Practices: How Smart is Your Firm?
I just read through a very interesting presentation by Mark Roberts, CEO, of the National Association of Computer Consultant Businesses (NACCB). Mark points out double-digit, year-over-year revenue growth for staffing and recruiting firms, but declining profit margins. Imagine what happens to those margins, and your firm, when growth inevitably slows down?
Now there are a lot of reasons for margin pressure – too numerous to discuss here in detail, and there is no point repeating what you typically hear throughout the industry. However, the Wall Street Journal ran an article yesterday on how business intelligence is coming of age across a variety of industries to help drive growth and profitability. I highly recommend you check it out. Once past the $5 term, “business intelligence,” the idea makes a great deal of sense for staffing and recruiting firms of all sizes. Afterall, we are in a numbers driven industry.
What I find especially significant about the use of business intelligence in staffing and recruiting is its potential impact on those declining profit margins. In the Mark Roberts NACCB presentation, he makes the point that 74% of a firm’s net sales can be attributed to the direct costs associated with recruiters and sales people – your front office. That’s a big number. Imagine if you reduced that direct cost percentage by a couple of points – that’s hundreds of thousands of dollars right to the bottomline of a mid-sized staffing and recruiting firm. That’s where business intelligence comes in.
Very soon Bullhorn will offer Bullhorn360, a new product for our front office that will let staffing and recruiting firms have complete visibility into the productivity of its recruiters and sales people. Productivity impacts profit margins. High performing recruiters and sales people make more money for you in less time.Cognos Which recruiters have the highest submissions and/or placement ratios by which type of job? What are the time-to-fill trends by job by client and by recruiter? Understanding those numbers in an easy-to-use, real-time way enables your firm to exercise much more control over your profit margins – you’re able to allocate resources much better. And in fact, you’ll have much greater visibility into appropriate levels of compensation and identifying the keepers that you want to retain.
If you read the Wall Street Journal article that I mentioned, you know the key point is integrating the data so it’s aligned with your business objectives. At Bullhorn Live 2007, Art demonstrated that Bullhorn360 will do the integration for you – all you need to do is choose the information you want to see. With Bullhorn360 our customers exercise greater control over their financial destiny. Till the next time