By: Gregg Dourgarian, CEO, Tempworks Software
Recent reports attribute an uptick in staffing to small businesses.
As a small business owner myself, this is exciting news. My business, TempWorks Software, primarily serves the staffing industry. That got me thinking: are there parallel strategies at work here between staffing and small business?
Delivering Greater Value
Hiring temporary staffing gives a small business owner the flexibility to upsize and, if needed, downsize, without significant cost. Outsourcing can help keep the cost of healthcare benefits relatively low. And working with a professional staffing agency has the potential to keep the actual cost of hiring down, a good strategy in an economic recovery.
Then again, what about the longer-term benefits? How can a small business continue to survive if it’s just chasing short-term benefits?
Keep in mind: staffing is a bitterly competitive space. In many ways, survival in staffing is very similar to survival as a small business. Like you, staffing firms are figuring out how to deliver better value than anybody else.
Staffing agencies can no longer survive long-term by saying, “we’re going to supply you with qualified people, and we’ll give you 10 cents an hour off your bill rate.” Like you, they’re asking: “How can I get a bunch of guys to come and pay to get into my party?”
The answer is: you have to have the goods. But what does that look like?
Staffing firms can prove their value by going beyond traditional small company recruiting strategies.
Some staffing firms are figuring out that you’re not just looking at your staffing expense. You’re also looking at internal employee expenses and at solution expenses - in other words, as your company grows, you may wind up spending more on consulting than you do on hiring clerical help.
These firms are succeeding because they’re realizing that businesses have squeezed the traditional temporary staffing firms as much as they can. They’re saying, “don’t pay $250 an hour for a consultant -- I can give you three consultants for $100 an hour.”
Increasing your value can be about the small picture. It can be about finding a market and then finding ways to serve it that no one else can do.
My company built part of its business on developing software for payroll services. We did that using what I call the Briar Patch strategy. When there are a lot of sexy things out there that we can chase after, we found a market that is decidedly unsexy.
We filled a need -- who wants to take on the problem of a temp worker who works in two locales and yet needs one check? That’s a real problem, but not one that anyone wants to solve. We survived at the start with one large client who was paying us to solve that problem.
Going Beyond Filling the Job
Staffing firms know that, as a small business owner, you must focus on your customers and employees and not waste time on things like how to file for payroll. If you are trying to grow a business and you keep spending time on little details, you are either going to go nuts or you’ll simply stay small.
Many staffing firms are specialized, which can help fulfill targeted hiring needs. They provide technical people, engineers or executives, but probably not all three. They’re also tapping into third-party software providers to offer payroll, paperless processes, information management, tax processing and mobile apps.
The most interesting strategies for me arise as staffing firms take on the big picture. As they find new directions for business growth, they delve further into the mindsets of small business owners.
Ask yourself: for your start-up business, who is the first person you should hire? The wisdom that persists among start-up business owners is that they need to hire people who are just like them. Perhaps that person, or people, should be someone who is not like you at all.
Collaboration is changing, too. A small software company owner like me might say “I’m supposed to be breeding the developers, not buying them. So now we’re going to build this software, and we’d like you to own part of it. We’ll create a visionary product that you’ll be a part of.”
That’s a much more interesting business proposition than just offering a product.
Some staffing companies are even going so far as to roll out new, collaborative business models that allow them to tap into resources from companies once considered their competition.
While all of this is developing rapidly, it points to an overall evolution in staffing trends. As the staffing industry reinvents itself with value-add staffing services, they go beyond supply-chain needs. In doing so, they’re thinking more like savvy small business owners.
Greg Dourgarian is Chief Executive Officer of Tempworks Software, which provides staffing software and payroll funding for all sizes of staffing companies. Gregg wrote the first TempWorks software as a teenager in 1975 with his staffing pioneer father who founded Manpower's technical and payroll operations. Gregg also built an airline software company. Its product, Supertrace, helps keep airline reservation systems running smoothly worldwide.