"If I have seen further, it is by standing on the shoulders of giants" – Sir Isaac Newton.
I love this quote because it reminds us that we can learn so much from all the business successes and mistakes before us. There are so many books, articles and living success stories out there with all the answers to our most burning business questions, but we need to look for the answers explicitly, or you will miss them.
What answers are your business looking for?
We are just over the halfway mark for 2023, so how is it looking for your recruitment business? What answers does your company need that could be found by seeing things from the metaphorical giant's shoulders?
At a previous event on business growth, the speaker referred to the "only" four ways to grow a business. If you've read Michael Gerber's 'The E Myth,' he refers to similar principles. So, what are these '4 Ways", and how can a recruitment company put these to use?
Are there only four ways to grow a business?
For many businesses, recruitment or otherwise, most owners focus on one way to grow their businesses – i.e., winning more customers or clients. However, with this thinking, they would be missing out on three other key avenues and, therefore, 75% of the opportunities to grow.
It sounds simplistic to say that there are only four ways of growing a business. But if you think about it, any strategy you can come up with to grow your business will no doubt fall into one or more of these categories:
I invite you to read with the mindset, "How could this specifically apply to my recruitment business?" HINT for action takers: make notes as you read and set a timetable for implementing your ideas.
1. Win more clients of the type you want.
Winning new clients is essential, but you want to attract more clients of the type you already like, rather than ones that make life a little bit more difficult for you! Hindsight is 20:20. There will be assignments you wish you had never taken and clients you wish you had politely said no to.
Just like best practices in marketing, define your ideal client profile and focus on finding more like that. By definition, or all the vertical and industry specialists, your starting point is more apparent. Whatever sector or level you serve, you can profile your ideal client organisation by some simple criteria like a stage in the company lifecycle, size, and location.
You will then want to segment further regarding nuances, values and beliefs. What about the organisation's culture or the leadership team's characteristics? Those who value your rigorous processes and rank accountability as key will likely be much more pleasurable (and profitable) to work with. You will know the type of client who values your industry knowledge and service offering. Use those clients as a reference point to build out your ideal avatar.
As a wrap-up to this first point, it's worth highlighting that people (aka your clients) buy the differences they perceive between one firm and the next. Unique differentiators help your potential clients understand why your business differs from your competitors and, therefore, why they would want to do business with you.
What is your unique differentiator, and how will it benefit your clients? Once you are clear on this and have identified the client type you want, you will have much greater confidence in asking for client referrals and exploring other strategies to win more clients you want.
2. Increase the number of times your client comes back to buy.
I am sure you have all heard about studies that suggest it costs up to 6 times more to win a new customer than it does to have an existing customer buy again. So how can you consistently offer outstanding service and encourage repeat business with your current clients?
I see and hear of increased firms offering more flexible fee agreements, for example, providing more extended periods of guarantee, performance-related fees or moving to a billing model where the client pays for the time the search firm puts into the assignment.
Many recruitment and search professionals miss repeat business by neglecting client relationships after completing assignments. In the busy working day of a recruiting professional, it's all too easy to focus all communication efforts on the few clients where there is currently life or potential work. During conversations with search firm owners, I've heard many say that their clients can quickly feel unloved in quiet periods and that recruiters only make contact when they want something from the client.
What can you do to nurture client relationships? Consider how you can delight clients at different points throughout the year and add value to their business and personal lives.
Most recruitment professionals genuinely want to live up to the status of 'trusted advisor' and 'partner' to their clients. An increasingly used phrase is being 'client-centric'.
3. Increase the average value of each sale.
To win a client's business in the first instance, your company has undoubtedly invested significant time and resources. Why not leverage that investment and increase the average value of client spending?
If you don't already base your fee on the full compensation package, can you justify starting to do that based on the premium service you are offering and the passive candidates you are presenting?
Can you transition into helping your clients solve more senior talent challenges and therefore access higher remuneration packages?
Can you offer solutions for project work to add multiple people to a department simultaneously?
4. Improve the processes within your business.
The processes within your firm will underpin and tie everything together. Your rigorous search process is the service that your client is buying. The desired outcome is a successfully hired candidate who stays with the new company delivering value for a few years. However, it all boils down to the processes in your firm that lead to that ultimate result. Do you have a defined process for your recruitment/search, and indeed for the other operations in your business? By improving the processes, a company will likely leverage any of the three aforementioned ways.
Increasing the effectiveness of delivering your search and recruitment services is central to everything. The quality of the processes defines and determines the quality of the outcomes (in this case, the quality of the candidate found, the experience and satisfaction of the client and candidate, and the magnitude of fees paid).
Training is a crucial area for improving the processes within your recruitment business. Having best practices and systems in place will spell out how to execute your optimal search (or recruitment) process and make it easy to train team members and delegate work where needed. Improving processes will create more time for the recruitment business owner to develop their firm further.
Conclusion
So, there, you have four ways to grow your recruitment business.
If, for any reason, you and your Team can't make this work revert to Plan B. (The one "Golden Nugget").
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