Q&A: What’s in store for the staffing firms in the future
Rituparna Chakraborty is the President of Indian Staffing Federation (ISF) and Co-Founder & EVP, TeamLease Services Ltd. At ISF, a conglomerate of Staffing industry stalwarts, Ritu actively promotes growth of the Industry and strategizes to initiate amendments to the regulatory framework that governs labor workforce in India.
What are some of the key industry-shaping trends in the staffing domain today?
The last couple of years have witnessed significant changes in the business, social and political context, both in India and elsewhere globally. Demonetization, Introduction of GST, Trump’s election as the President of the USA, Brexit, protectionist measures adopted by the developed countries, the increased proliferation of digital technologies and automation, the consolidation of the start-up space and the rise of the gig economy — all these have had a bearing on the industry at large, including the staffing industry. As we move forward, staffing industry is also responding to these marketplace developments to stay relevant by moving up the value pyramid and broad-basing their offerings. They are building domain specialization to cater to the unique needs of each industry domain, investing in technology to enhance their own productivity & performance, and focusing on providing not just any head-count but productive headcount.
Gig economy is the real deal today. With all the self-directed employment options available, how can staffing companies remain a valid option for candidates seeking flexible employment?
The Gig economy is a reality, however, for more advanced labor markets. Rapid increase in Internet penetration and constant innovation in technology has made this possible. Having said that, the market in India is big enough to accommodate the gig-economy and the staffing firms –and given that employment market in India is largely informal in nature, gig economy is unlikely to have an upper-hand overstaffing.
Staffing firms can stay relevant to their clients and candidates by offering a differentiated value proposition. Staffing firms have some inherent advantage which they need to leverage even better –as they face the realities of a gig economy. While gig-economy based workers thrive on the independent lifestyle, there are limitations and downsides of being an independent professional and this is where it helps to be employed with a staffing service provider. So the staffing services companies would need to demonstrate to their candidates the overall value they offer in helping a job-seeker build a sustainable career while giving the candidates the flexibility they desire. They need to underscore the importance of Employer Relationship, Employee Benefits & Support, and enabling specialization while bringing in the element of learning & skill-building, which is a critical enabler of jobs today. Staffing firms need to be seen as a comprehensive one-stop resource of jobs and career-related advice.
The staffing players also need to embrace the market-place model of the gig economy that enables candidates to seek jobs and opportunity of their choice through easy-to-use mobile apps and desktop solutions. More importantly, staffing services companies would need to calibrate themselves with the expectations of the employer and employees and that would be critical to stay relevant, competitive, and profitable.
Traditional staffing and recruitment firms are now competing with everything from Uber to Upwork for talent. How can staffing firms capitalize on this entrepreneurial approach to employment?
In today’s time, where we live in a highly dynamic and volatile world, staffing organizations like other organizations need to be nimble, agile, and flexible, while being customer-centric and responsive. They also need to align their strategy to the changing mindset of employers and employees. Uberization of work and the rise of gig economy have changed the way the world works — it has not only fundamentally altered the employment landscape but pushed to the fore new business models and employee engagement models. It has also created an entrepreneurial approach where employees now prefer to be on their own, and have flexible working arrangement. This shift will impact the future of work and staffing firms have to account for this change. Given that they are the critical bridge between the employers and the employees/candidates, they will have to reassess their strategy and re-align themselves.
The rise of gig economy has signaled an important change, which is leading to the emergence of the ‘entrepreneur employee’ — so staffing firms have to try and capitalize on this change. They will have to look at their current hiring and service delivery models to see how they can leverage this trend to hire, attract, and engage the contingent workforce. They have to strengthen their own value proposition to cater to the needs of this millennial workforce and in doing so draw on the complementary proposition of the gig economy.
Candidate experience is arguably more important today than it has been in the past. What does it mean to provide a great candidate experience and why should recruitment firms make it a priority?
A great candidate experience ensures that employees are engaged and motivated and they value their relationship with the staffing service provider better. It improves morale, performance and employee productivity. Happy and engaged candidates become ambassadors for the staffing service provider and they aid referral and help in attracting talent.
Candidate experience should be a priority for the staffing service firms, as it results in lesser employee turnover and attrition, which in turn has a positive impact on the bottom-line of the staffing firms. It also helps to improve its positioning as a preferred employer – which can help attract right talent, while reducing recruitment cycle time. By investing in candidate and employee/associate experience programs, staffing firms can improve employee engagement, morale, productivity that will ensure that the employees/candidates assigned to work with the client are committed, diligent, and effective in meeting the job requirements. Given this, it is important for staffing/recruitment firms to proactively invest in candidate experience.
What should staffing and recruitment firms do to enhance candidate experience?
Firstly, staffing and recruitment firms need to orient themselves to this idea of building strong employer relationship with the candidates they seek to hire, and in line with that align their internal processes to make candidate journey seamless, hassle-free and memorable. Candidate experience at the point of entry is critical as it is a determinant of how the candidate will engage with the staffing firm and how he/she will perform on the job. Therefore, it is important to treat the candidates right the very first time. Secondly, it is important to ensure that they stay connected with the candidate at every step of the hiring process; and thirdly, to ensure the right level of communication and information access. It is important that the candidates get to know all the relevant details about the organization, job, working environment, and the benefits. As part of the communication process, candidates should be exposed to the organizational messages and the experience of other candidates who serve as a testimonial. Post joining, for sustaining the level of engagement and communication, staffing firms can undertake periodic pulse surveys to ascertain the employee engagement and motivation levels and basis that align interventions and initiatives that can help improve candidate and client experience.
While production numbers are important for profitability for staffing firms, this can only be sustained by delivering an incredible customer experience. Do you think candidate satisfaction and client satisfaction are mutually inclusive?
Candidate Satisfaction and Client Satisfaction are not exclusive but mutually inclusive. A candidate/associate who is happy would be more engaged and therefore more productive – and clients are looking at productive resources as they contribute to the bottom-line. By proactively investing in candidate engagement and their development and well-being, staffing companies will not only ensure tenure and longevity of their candidates, but also that the clients benefit. An important part of building a strong client relationship is enhancing clients experience and that happens only when clients benefit from having trained, skilled, compliant, and productive workforce.
Do you think staffing agencies have contributed to the erosion of candidate benefits?
Staffing firms have helped significantly in improving the employment scenario in the country. The fact that staffing agencies and firms have nearly 3 million people working on their rolls, speaks about their contribution to the economy. They have been instrumental in driving the formalization agenda and ensuring formal employment for people. Formal employment entails having formal work contracts, appointment/hiring letters, minimum wage payment and paying all statutory benefits to the employees — staffing firms are actually helping people get formal employment along with the benefits.
Automation is both a top priority and a top challenge. How do you think automation is affecting the staffing industry? Is it revolutionizing the industry or decimating it?
Automation will benefit the staffing industry greatly by improving productivity and operational efficiencies, which in turn will improve their performance and bottom-line. Automation will help improve candidate sourcing, hiring while streamlining the whole recruitment process. Given that recruitment is a critical need for any staffing business – any improvement in this area has a direct bottom-line benefit. It will also help in reducing transaction errors involved in salary and benefit administration, which in turn will mean that staffing companies are not only able to meet their SLA’s but also ensure a great client experience.