14 February 2012

Dual Desks: A drag on consultant productivity and company profit

When I first started as a recruitment consultant, back with Hays in London in 1989, I was a perm accounting consultant. I worked in a team with 6 other perm consultants. All of us only recruited perm jobs.  

When I returned to Australia and joined Temporary Solutions, I was one of a team of three temporary accounting consultants. All of us only recruited temp jobs (including temp-to-perm). 

When I moved to Adelaide to establish a new office in a new market for Recruitment Solutions, I had one other consultant, and we were both working to build a combined temp and perm desk each. 

Having had those experiences and having worked with many different sized recruitment agencies over the past 9 years, it's clear to me that running a combined desk is very difficult and very rarely does it result in a flourishing temp and perm business for that consultant. 

Multi-tasking at this level stretches the abilities of even the most capable and motivated consultant. 

My experience tells me that a dual desk consultant is almost always a perm focused or perm-trained recruiter trying to build a desk of temps ‘on the side'. 

Here are the biggest barriers to a combined perm and temp desk reaching its full potential: 

1.    Cash flow: Paying out money to temps before you are paid by the client is a big financial commitment. Running a temp desk requires a very tight management of cash flow and effective financing arrangements for running an overdraft. The recruitment company owner/CEO will naturally gravitate towards a consultant generating the big lump sum payment that a perm fee provides rather than the slow drip of weekly margin, paid in arrears.
2.    Creating jobs: A temp consultant has a much greater likelihood of creating a job ‘out of nothing at all' because of the much smaller amount of internal red tape involved in a temp job being approved, compared to a perm job. This temp job creation requires a significant investment of a consultant's time each week in being pro-active with marketing candidates. A dual desk consultant will always default to working on a vacant perm role first, before picking up the phone to market with a view to creating a temp role.
3.    Assessing resumes: Some of my best ever and longest standing temp candidates were those that had resumes that made discerning their key skills and motivation very difficult. Job hopping, travelling, incomplete study and qualifications and multi-industry experiences were all factors that influenced perm recruiters to mostly avoid those candidates.  However these ‘licorice all-sorts' factors had temp recruiters intrigued to find out more about this person. In my experience perm-focused dual desk recruiters were rarely interested in understanding the potential of round-hole-square-peg candidates.
4.    Interviewing priorities: Interviewing for perm jobs generally involves selecting candidates for interview against a very specific job that is currently vacant. Interviewing for temp jobs generally involves selecting candidates for interview against general jobs that you have had in, and are likely to have in, but you don't currently have vacant right at that time. Hence it's easier to select and prioritise candidates for perm jobs.
5.    Interviewing skills: Due to the client expectation of a temp being productive on the first day of the assignment, a temp recruiter's interview of a candidate needs to be relatively more focused on technical capability compared to a perm recruiter's greater focus on behavioural competencies and motivation (combined known as ‘cultural fit'). Dual desk recruiters tend to be more perm-focused in their interviewing so are unsure whether the candidate really can do the job on day one.
6.    Job filling skills: Due to point 3 above, the dual desk consultant is less confident about selling the candidate over the phone to the client, so they default to sending resumes and arranging interviewing, a sure way to dramatically reduce your job fill ratio.
7.    Sweating the small stuff: A temp recruiter has a lot of small stuff to deal with. This can be from basic admin to the more important (and money generating) habit of checking on ‘sleepers'. Dual desk recruiters tend to overlook a lot of this stuff as they focus on perm jobs. The duty of care and motivation to care are two aspects of a temp recruiter's job that require lots more anticipatory and proactive thinking and action (ie site visits to temps, taking them for a coffee/lunch etc).
8.    Leadership mindset: A perm recruiter is an agent facilitating the permanent employment relationship between the client and the successful candidate. A temp recruiter is an employer who is selecting employees (temps) to be part of his/her team. The duty of care and motivation to care are two aspects of a temp recruiter's job that require lots more anticipatory and proactive thinking and action (ie site visits to temps, taking them for a coffee/lunch etc). Dual desk consultants rarely find time to do this part of the job, and don't understand its importance until something blows up in their face. Sorting out problems inevitably takes more time and costs more money than preventing them in the first place. 
There's plenty more, but these are the main barriers. 

In my experience the biggest barrier to making a change to specialist perm and temp desks is managing the remuneration issues inherent in transitioning desks across consultants. 

There is a very high level of difficulty in getting this right so that each consultant is treated equally and fairly and the business is not double paying commissions or bonuses. The level of difficulty is so high that most companies avoid doing it and persist with the dual desk policy (The I-will-deal-with-it-next-year attitude) in spite of knowing that it's a policy costing them money. 

What's your dual desk costing you?  

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Is temp recruitment more demanding than perm??

1 comment:

  1. Ross your comments are spot on. I ran my last recruitment business as a dual desk set-up and I know exactly what you are saying. Now ultimately we were successful but many of the problems or performance issues were due to some of the above reasons and being a star performer in one or other requiring different skills and mindset. I found that Consultants would lead with temp or perm and the other would be their 'back up' or the 'cream' for the month. When there is revenue coming in from both, it makes in nearly impossible to give one up! I thought about splitting it many times - but like you say, there was never the 'right' time or the 'perfect' answer.