Winning requires more than a front office solution

Technology and its role in the staffing business is evolving and growing at an incredible pace. As one of those people who can still remember using white boards, index cards and mechanical check writers, it is amazing to see the technology available to a staffing business today. Now technology can make a staffing company what every customer wants their agency to be: faster, better and cheaper.

In talking with staffing business owners, we find a consistently high level of interest in technology, and great attraction to all the “latest and greatest.” That’s easy to understand, but what surprises me is the nearly exclusive focus on front office “bells and whistles.”

Don’t get me wrong. I recognize that there are significant efficiencies to be gained from one-click job board posting, integrated email and texting, direct resume parsing, and Boolean search tools with ranked results and highlighted key words. I’m in favor of all those things.

We’re right around the corner from the day when it will be common for staffing companies to manage the entire recruitment, interviewing, screening, testing and on-boarding process in an online environment, paperless and touch-free. I just hope that when we get there, we’re not still keying in hours from faxed timecards, exporting data files to separate payroll processing systems, and printing invoices from QuickBooks.

Many staffing companies—including some sizable, well regarded firms—still operate with fragmented systems and labor intensive processes in the back office, while robust, state-of-the-art tools support front office operations. Some even think it’s perfectly fine to use three or more disconnected systems and processors in the back office. “Nobody ever made money in the back office,” they say. But a whole lot of money can be lost there. Every week.

Pricing pressures affect nearly every business today, and we’re all part of a big efficiency race and productivity contest. Can a staffing firm afford to have a core employee calling clients for time approval and manually keying in hours if the competition is capturing time through an online facility that automatically emails clients and links directly to the payroll system? Can they afford to have someone attaching paper timecards to paper invoices, stuffing envelopes and running a postage machine while a competitor delivers invoices through an automated email system with links to approved, online time reports?

When margins are thin and shrinking, how can staffing business managers assure consistent profitably without visibility to true costs and gross profits (with actual payroll burden) at a granular, client and employee level? When hours and even minutes count for the customer, how can a staffing manager be effective if he/she has to wait a month or even a week to see financial and operational metrics in spreadsheets that are manually compiled from three different systems?

The staffing companies that win the race will be those that can leverage technology to optimize efficiency and performance “from req. to check,” from job order to receipt of payment. They will have fully integrated systems that accelerate workflows while minimizing errors and duplication. With real time visibility to the performance of the entire business their managers will make better decisions that lead to improved outcomes for the staffing firm and its clients alike.

Fully integrated workforce and financial management systems are key to balancing increased customer demand with the delivery of cost effective staffing services. To maximize the benefits of advanced technology, staffing firms need to implement technological strategies that encompass and effectively link the front and the back office.

Unfortunately, there is no true enterprise solution affordable to the typical staffing company—no one out-of-the-box application to manage everything from job posting and applicant tracking to order management, payroll processing, billing and general ledger. Even a basic software “platform” system for staffing business management will consist of at least two different applications.

Key to optimizing technology are:

•  approaching decision making with the entire business and all its interconnected process in mind,
• evaluating technological tools primarily on the basis of the ROI they can produce, the time, manual workload and expense they can eliminate,
• minimizing the number of different applications or systems required to support daily operations, and
• getting all the systems linked and “talking to” each other efficiently.

Of course, most staffing people are not technologists—nor should they be. Most of us struggle to understand exactly how a comprehensive information system would work, much less how to create one from several disconnected pieces.

With the pace of change in technology, and its growing criticality to competitive success, it makes total sense for staffing companies to partner with a qualified, specialized firm for the development and management of IT solutions, and even for management of the back office business processes themselves. With someone else focused on the technology and back office execution every day, you can better utilize your own resources, human, intellectual and financial, to grow the staffing business.