27 April 2011

Australia's most productive companies: what can recruiters learn?

A couple of weeks ago, daily news service, HR Daily, published a summary of the recent Profiles International publication Australia's Most Productive Companies 2010. The report is a summary of recent research (150 of Australia's public companies) into the factors that drive high revenue per employee.

Further research, including interviewing executives within each high-performing company, identified specific aspects of their culture that drive high productivity.

These attributes were then collated under the headings of People or Strategic and Operational.

I have listed the People Attributes below, with my views as to the typical reasons that prevent many recruitment companies from being even close to Most Productive Company status. 

The Strategic and Operational Attributes are then listed with a very brief comment.

People Attributes

1. Performance-driven culture
What the report says: A large number of Australia's Most Productive Companies (MPCs) have built true performance-driven cultures in which the entire workforce focuses its effort on achieving the results most important to the organisation.

What I say: Many recruitment companies fall down in this area because ‘results' become solely about top-line billings or margin. Highly successful recruitment companies have just as strong an emphasis on behaviour for all employees (ie not one rule for big billers and another for everyone else).

2. Effective managers
What the report says: He or she takes responsibility for ensuring that an individual succeeds and that the team, department or business unit achieves its expected results. The MPCs are typically more proactive than their peers when it comes to identifying and developing effective managers.

What I say: The emphasis on (and remuneration linked to) the individual billing of each manager means that the core focus of an effective recruitment manager, helping their subordinates improve and succeed, all too often becomes secondary. As a result far too many rookie recruiters struggle then quit in their first 12 months, demoralised and unsuccessful.

3. High employee utilisation
What the report says: All jobs have clear descriptions and goals so that everyone knows exactly what needs to get done and how. They expect people to arrive at work a little earlier and leave a little later, and they reassess priorities to determine what work is most important and what activities can be streamlined because they don't add sufficient value. And they have efficient selection and on-boarding practices so that new people become productive in a short amount of time.

What I say: Embarrassingly, for our industry the standard processes to select and on-board new recruiters is ad-hoc, not competency based, reactionary, disorganised, long on promises and short on delivery. As if this is not bad enough, many recruitment companies seem to boast of their low employee utilisation in their own job ads for recruiters (eg no KPIs, fortnightly RDOs, etc).

4. High employee effectiveness
What the report says: The MPCs always keep before them a clear picture of the type of employee who has the best chance of succeeding in the role. They consider an employee's fit with the job, the team and even the manager. And they use the characteristics displayed by high-performing employees in each role as a model for prospective hires.

What I say: The concept of building a profile or template of an ideal recruiter based on profiling existing high performers (results and behaviours) within the organisation, appears to be rarely practised within the recruitment industry. Given how quickly a high performing recruiter can become profitable for a recruitment company, it seems puzzling that this remains a huge gap for most recruitment companies.

5. Encouragement of innovation
What the report says: The MPCs are likely to encourage an exchange of ideas among employees, managers and leaders to make the business more competitive. When employees and managers have open lines of communication, employees become more invested in the organisation's well-being. The MPCs also typically do a better job of putting ideas into action than their peers.

What I say: The underperforming recruitment company works in silos (desk, teams or business units) and widespread communication only occurs when there is bad news (eg we didn't meet target this quarter so no chocolate biscuits next quarter) and when communication does occur, it's mostly via ill-thought through emails or embarrassingly disorganised meetings complete with dull or illegible PowerPoint slide shows. Agreed actions rarely happen within designated timeframes, if at all.

Strategic and Operational Attributes

6. Technological sophistication - Are there manual files piled on your desk?

7. Financial sophistication - Do you know your real time YTD fee income? By consultant? By client? By business unit? By industry?

8. Operational sophistication - Still emailing resumes in competition with a multitude of other recruiters to a client who wants a 10% fee and cannot be bothered to meet with you or even return your calls?

9. Effective distribution channels - Still relying on job boards for 90% of your candidates?

10. Marketing and brand sophistication - Still cannot even convince yourself when a prospect asks ‘so how are you different to every other recruiter that wants my business'?

What can you learn from Australia's Most Productive Companies?

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