Staffing Technology

39: A call to front office vendors: onboarding automation please

Hiring companies are pushing more and more administrative functions to their staffing suppliers. Staffing companies have between one and two dozen forms for new hires to complete. Just figuring out which federal, state, local, client-specific, position-specific and staffing company forms need to be completed for each new temporary employee is a major feat. Strict client compliance requirements and looming government audits mean that staffing companies need to implement effective processes for managing this immense amount of paperwork. Automation is the natural soltuion for exactly this type of uniform, high transaction process.

Many corporate HR oriented applicant tracking systems come with onboarding workflow, forms tracking and management and e-signature capabilities. However, onboarding solutions are not readily available fromcommercial front or back office vendors, even though the pain of managing onboarding paperwork is industry-wide. Because front and back office staffing solutions have not provided robust solutions fast enough, staffing firms are starting to find innovative ways to automate these painfully manual processes. It's unfortunate that staffing firms are having to work hard toadd additional technology in order to automate onboarding. In 2010, we hope to see more onboarding and compliance functionality integrated with, or built into, leading front office solutions.

Check back for our upcoming article on onboarding automation in ASA's Staffing Success magazine.

37: Buy not Build

We here at The Code Works love custom software as much as we love commercial packages. We see the strengths and weaknesses on both sides in the buy versus build discussion. Really, we do. But because of the high cost and risk associated with custom application development and the availability of good commercial packages for staffing firms, It is our view that there must be a compelling reason for a staffing firm to decide to build rather than buy.

At the end of the day our clients tell us that they are in the staffing, not software, business. Many, many staffing firms have learned this lesson the hard way. Nearly every large public staffing firm has an embarrassing annual report or two outlining massive write-offs related to a failed  software development or major customization project. Many staffing firms have learned the hard way that they do  not have the software product development discipline nor the software development capability to successfully complete and manage custom dev projects.

While our off-the-shelf staffing software options may not be perfect, they have improved over the last several years. Software vendors are releasing new functionality routinely. While custom systems can be extended to include new functionality too, we see that commercial packages are integrating with more and more technology-enabled services (e.g. background checking, payroll service providers, VMS integration, social and professional networks). We believe that it will be harder and harder for custom staffing systems to keep up with the partnerships and integrations that off-the-shelf vendors offer.

There is clearly a trend for staffing firms to buy rather than build software. Manpower selected Bond Adapt for all staffing segments across all branches worldwide. Kelly Services selected Bullhorn for their professional and technical staffing segments in the US. When large and complex organizations (who would've been best positioned to benefit from the economies of scale of a custom system  move away from their own custom apps toward off-the-shelf solutions, it becomes even more evident that off-the-shelf staffing solutions must be seriously considered - if they can do it - you probably can too.

Custom systems can be tightly tied to business process and this  can be appealing. Technology can be a key enabler of a staffing firm's differentiators. Sometimes, the differentiator can be configured or customized into the off-the-shelf system. Sometimes, not. It is our recommendation that staffing firms be very clear about the importance and necessity of the functionality that drives the decision to build rather than buy staffing software. Be sure it's differentiating - be sure off-the-shelf systems can't handle it - be sure you can't risk leaking the intellectual property with the outside world.

Do everything you can to talk yourself out of building that custom application before you make the leap because once you commit to building it you are definitely a pig not a chicken, and it is going to be incredibly difficult for you and your organization to make the move to an off-the-shelf application down the road.

32: Killer feature: Who knows who functionality

In my opinion the killer feature in executive search FO/ATS applications is who-knows-who functionality. We've added this question to our standard FO RFI and have found that staffing FO vendors don't offer this feature - at least not yet.

Successful executive recruiters rely heavily on referrals and capture a contact's network continuously. Executive recruiting software includes a simple feature which allows recruiters to enter the name and characteristics of the relationship. So, for example, the system has a simple way of capturing the fact that board members Sue and Joe golf together, used to work together, hate each other, etc.

Professional and social networking sites allow recruiters to view the network that contacts want you to see but it is impossible to characterize the relationship or to leverage the connections in a sophisticated way. That is, you can work you way to the person you want to know but you don't know the quality of the relationship, especially with open networkers.

Simple who-knows-who functionality allows recruiters to capture the portion of the network that matters to your staffing firm and to characterize the quality and type of the relationship. Some executive search software helps you visually see the links across your database so that you can find a warm, high quality path to contact them,  within your very own, honed database.

I don't know about you, but I think this feature would be a great addition to FO and ATS software as long as it is extremely easy to use.

23: VCG takes $5m

VCG Software announced that it took $5m last month (June 2007) Jefferson Capital Partners Ltd. and Constellation Software Inc. to support the launch of Pointwing, their next generation front office built on the .NET platform. 

It looks like Jefferson Capital made a previous investment in VCG for the WebPAS product. Looks like VCG took $7.5m in 2000.  Constellation Software says they invested $4m, generally buy vertically focused software companies and like the potential of being able to buy VCG in the future.  I honestly had not realized VCG was venture-backed until Constellation's press release said so - they've been around so long..

I am trying to think of any privately-held front office application vendors that are venture-backed and can't think of a one this morning. Can you?

Post a comment or email me if a vendor name springs to mind.

12: Front Office (FO) vs. Applicant Tracking System (ATS)

Earlier this year I published a two part article on Front Office (FO) systems in SI Review. The first part talked about front office functionality trends and the second part talked about how to select an FO application and listed basic information about the off-the-shelf vendors. When I started the article I thought there would be about 20 or 30 vendors on the list and by the time I was done, there were 54! 

FO software is typically marketed to contingent staffing companies.  There is an adjacent market, Applicant Tracking System (ATS) software that is typically marketed to HR professionals for direct hiring.  I counted 54 FO apps and there must be 3 or 4 times that in ATS software solutions. 

One of my messages in the article was that I see the potential for FO/ATS convergence since the two feature sets and markets have so many similarities.  My gut tells me that the overall market is not large enough to support all of these vendors. We've already seen a lot of M&A across ATS vendors; I am sure that we'll continue to see consolidation and convergence in the ATS and FO spaces.

Some vendors have crossed over and started to go after their complimentary market. For example, we see Taleo talk about going after the staffing market, Bond go after the HR space, and companies like HireDesk selling into both markets more or less equally.

When investigating your options at a high-level, it can be difficult to see the differences between FO and ATS. Some of those ATS options are becoming increasingly enticing. ATS is a larger market with greater competition, so features and technologies typically advance faster.

However, if you are using an ATS (not an FO) to support your contingent staffing processes, it is likely that you are seeing some real ATS shortcomings. These so-called shortcomings really stem from the fact that they focus on two different markets.

A few examples of ATS / FO differences:

• Hiring companies need workflow in the ATS to manage job requisition approval; staffing companies don't need that workflow - they assume the req was approved before it hit their desk.
• Staffing companies need to ensure hooks into their time & expense tracking and billing & invoicing applications (if they are separate).  Hiring companies need to get the ATS data to their HRIS.
• Contingent staffing companies aim to place candidates on consecutive assignments, while HR departments have a totally different perspective on multiple assignments for a single candidate - they call it managing internal candidates.

As I stated in my article, if you are searching for an FO replacement it is important to take a look at adjacent markets, like ATS; just be sure to focus on enabling your business process and try not to be dazzled by the ATS market size, momentum and price points.