Get your team lean and mean for the downturn

Whether it is officially a recession or not, some sort of downturn is on the way. Now is the time to get your team fighting fit so that you come out on top. John O’Sullivan looks at the steps you need to take to ensure survival

Well — is it going to happen? If so, when? In what way will it affect me and my company? How long will it last? What should I be doing about it?

These are the burning questions within the recruitment industry at the moment in relation to the much talked-about, and now seemingly inevitable, economic downturn.

The last real recession ended more than 15 years ago. So it's hardly surprising that few owners and managing directors have any real world experience to guide them in handling the potential storm ahead.

So what are the key headline actions you should consider to make sure your company is in great shape for the trials ahead?

First, it's important to engage with your staff, consultants and support alike, to make sure they have a good understanding of what you are doing and why.

When conditions change, they are looking for your leadership more than ever. They need to see that you are in command and confident, and not burying your head in the sand and in denial about external conditions that might affect the business.

Without alarming them, you must make a confident statement about how more turbulent times will take many of them beyond their experiences to date, but that you have plans that will give them the tools to survive, and even thrive.

You can even go so far as to create a sense of excitement surrounding the new methods of working they will learn. It's certainly fair to say that the job of a recruiter can be more demanding, and therefore ultimately more fulfilling, if you are not just cherry-picking all the time.

From the frontline sales people to the back office and support functions, you will need to adopt a survival mentality, a sense of 'We're all in this together'. Having set the scene, you will then need to train and support them.


Customer relations

Think about your customers. Customer relationships are always important in recruitment, whatever the economic conditions, but never more so than when times get tough.

If you think you've already got close relationships, then now is the time to make them even more binding. If you haven't concentrated on this so far, you will need to take immediate steps.

When head-count freezes start to take effect, and the list of suppliers is culled, you need to be in a position to ensure you are not one of those jettisoned.

Perhaps now is a good time for owners, directors and managers to undertake quality audit surveys with all your key customers. This will enable you to find out what they think of you, your company and your staff, as well as help you to get a good handle on what their plans are for coping with the prevailing economic conditions. Better to engage with them now, while you still have chance to advise them, or even help them with implementation, than to wait for the 'Dear John' call.

It will also send a clear message to them that you are there for them, whatever the outlook, and prepared to work with them more closely. Even if their immediate hiring plans halve, providing their suppliers fall by more than that, and that you are a survivor, this will work to your advantage.

'Added value' is an over-used term, but now is the time to give key accounts more than your competitors will — or even more than your clients expect from you. Surprise and delight them, and make them see you in a different light, a 'cut above'.

Offer to undertake tailored salary surveys for them or to train their hiring managers in competency-based interviewing techniques and CV assessment. Perhaps invite their HR people to your offices to see how you resource candidates. The list of possibilities is endless; the important thing is that you are doing something in the first place.

And don't just restrict offering added-value service to current clients. Come up with a target list of past and potential clients, particularly if they are in sectors unaffected by the downturn. Then go and eat your competitors' lunch!


More involvement

Get your people involved in and committed to this strategy. You might run an incentive programme for those who engage with their clients the most.

Even though tougher times are probably coming, most sectors are still suffering an underlying skills shortage. So if you can get the candidates that your competitors can't, you will still make placements. Clients will deal with you if you are holding the 'product' they want.

Most recruiters nowadays have been trained in, and allowed to use, what I call the 'lobster-pot' method of recruitment, and it has served them well in buoyant times. This involves putting all their vacancies on the job boards (at great expense to the company), going home and pulling up the 'pot' in the morning to see who has responded.


Creative resourcing

All well and good — but these are the applicants who are available to all and sundry, and won't set you apart in tighter markets.

Creative resourcing techniques will not only find the gems out there, but will teach your consultants new skills. They will need to learn how to get referrals, make head-hunt calls, gain candidate exclusivity, and use the social and business networking sites, among many other tools and techniques that will set them apart.

Invest in training, and perhaps book trainers for weekend sessions. Your team must understand that working outside normal hours is going to be vital for recession-busting strategies to succeed. It always has been, and will be again.

Another idea: why not offer a short-term commission booster payable on placement of candidates not found on the job boards?

And speaking of money, many of those that went under in the last recession were actually profitable at the time, but simply ran out of cash — something you will only do once.

You need to maximise revenues and keep costs under tight control, but most important of all is to make sure you get the cash in, and quickly.

Review your clients and make sure you are not overly reliant on a small number of them — particularly with temporary workers — and therefore more vulnerable to a bad debt. Get bad debt insurance cover if you don't have it now; the banks and invoice discounters will be happy to quote.

Trade something with your clients for better settlement terms. Perhaps discounts from standard terms and conditions or better rebate terms, and train your credit controllers on getting your company to the head of the queue for cash collection.

Perhaps your external accountants could give your credit controllers free training. If not, maybe another, keener firm might be interested in pitching for your business.

Ask your own suppliers for discounts. They will be feeling the pinch and keen to hold on to your custom — and if you don't ask, you certainly won't get.

Do a forensic review of your costs, with no sacred cows. Distinguish between those that are revenue enhancing and revenue draining. Imagine that your survival depends on it, because it just might.

You want to cut out waste, and make no mistake, there will be some. Encourage your staff to join the exercise. Perhaps by introducing a simple profit-share scheme, the savings will come.

The good news in all of this is that you are likely to come out the other end of any downturn all the stronger. But to do so, first of all you've got to survive, attract and retain the best staff, train them accordingly, and let them loose on great clients and candidates.

It's easy when you know how.

John O'Sullivan is the owner and managing director of Elite Leaders, a peer-to-peer learning group for the owners of recruitment companies.

www.eliteleaders.co.uk

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