Victory Over Chaos

The employment industry is transforming once again. This time the drivers are quite different from those of the late 1990s. Employers are coping with the need to lower costs and boost productivity and revenue in a still-sluggish economy. "Do more with less" is their daily mantra.

That's why companies are looking to HR outsourcing firms and a myriad of management consulting firms to provide remedies for ailing profits. Executives throughout North America are being charmed by "costs less, does more" solutions.

This climate presents opportunities for the entire range of firms who service HR. For example, now in demand by HR departments are individuals and firms with knowledge of applicant tracking processes, branding, Internet recruiting and direct recruiting. The more technical, flexible, customer service focused and problem solving their orientation, the more valuable they are.

Firms and sales executives with experience selling executive recruiting services are quite attractive to an HR outsourcing, HR consulting, or to an employer services firm aiming to win a few million dollars in service revenue from their client base. Strategic partnerships leveraging each others expertise and contacts will produce additional revenues.

Some HR insiders may feel threatened by the outsourcers. They can, however, either seize the opportunity and join the ranks of the consultants or compete internally for the business. Marketing graduates now working for within the industry may be lured by service vendors, eager to infiltrate the 20,000-30,000 third-party firms and the 5,000 plus Human Resoruces organizations in North America.

As long as third-party recruiting and staffing firms seek to broaden the scope of their practices and HR staffs strive to cultivate greater recruitment expertise, musical chairs will be a lively industry game-just don't expect the music to slow down anytime soon!

To stay limber, third-party firms have pared their teams down to the bone, and more new hires will be sought at the lower end of the compensation scale. Many of these firms will begin to target entry-level individuals to perform pieces of the highly complex recruitment process. Efficiency is a virtue; so this is not a bad thing. Permanent placement owners and executives have realized that they must segment functions in order to attract, cultivate and offer career paths for their staff and build their firms for the long term. In addition, this can be an opportunity to expand expertise and integrate additional services.