Category Archives: Staffing & Recruiting

Commentary, articles, and whitepapers related to my nearly 25 years of experience in the staffing and recruiting industry, with specific attention on how technology — staffing software and recruiting software — impacts the business of staffing and recruiting agencies.

Three Secrets to Staffing Software or Recruiting Software Selection

How to select staffing software or recruiting softwarePsst! Want to know the three secrets to choosing the best software for your staffing or recruiting agency? Sure you do. And I’m going to share with you the three secrets to choosing software that I’ve learned over the past 25 years that I’ve spent marketing staffing and recruiting agency software.

If you’re in the market for new staffing or recruiting software – and you should be if your current software is more than 5 or 10 years old – you’ve probably already made your wish list of what that software should be able to do. And that’s great. You should do that. I know that because I’ve written many guides over the years to help staffing and recruiting agencies make honestly objective “good” choices.

Now I’m going to share with you how you can assure yourself that you’ll make a “great” choice.

You see, there are three factors – “secrets” – that will determine the success of the software you buy for your agency. And they have NOTHING to do with any special technology or whatever else a software sales rep is telling you. These secrets have everything to do with the software vendor and their vision, attitude, and commitment to achieving success. They measure the essential stuff that pays off for the vendor, and more importantly, for you and your agency.

What are these three secrets? Glad you asked!

First, they have to INNOVATE.

Staffing software and recruiting software vendors must innovateWell, duh, right? Software developers started their business built on an idea. The idea was to innovate and solve a problem using software that would result in better organizational performance.

For staffing and recruiting software vendors, the problems usually revolved around either front office recruiting or back office payroll/billing. The earliest staffing and recruiting software solutions were relatively crude and cumbersome, but they were an innovative miracle to agencies that were often overwhelmed with paper CV’s and the challenges of payrolling temporary workers.

Over the years, these solutions have grown in their complexity and sophistication, offering more bells and whistles and integrations and “enhancements.” Some of these new developments have been fairly innovative. And all of them were supposed to improve the performance of your staffing and recruiting agency. Maybe they did. But, when was the last time that your staffing software vendor offered or delivered to you a truly innovative enhancement to its product?

I’m not talking about an enhanced interface or integration to someone else’s product. Or something that you’ve been asking for in the software for years.

Nope. I’m talking about blow your socks off innovation that perhaps caused you to re-think your entire business service model because you see where implementing the new staffing or recruiting software can dramatically improve performance and profits.

When you think about innovation in that context, it’s really rare, isn’t it?

And that’s the problem. Staffing and recruiting software vendors often started with great ideas and created spectacular solutions. Then they spend the rest of their business life trying to stay up with or ahead of the competition. Some are just as happy with the status quo and become “one-hit wonders.”

True innovators are always doing more. They think up, develop, and provide frequent enhancements that deliver on the long-term vision of the software company to help agencies do their jobs better, faster, more efficiently, and more profitably.

Innovators are fearless and not afraid to put forward concepts that solve your agency’s problems in ways you might never have thought of. Innovators will see the possibilities in some new technology and adapt that to other staffing and recruiting problems. Non-innovators will just try to keep you happy enough to renew your maintenance contract.

A good example of forthcoming innovation is the beginning onslaught of Artificial Intelligence-based systems that will, according to many, disrupt the business market over the next 10-to-20 years. In 2015 nearly $3 billion dollars was spent on HR-related technology alone. Where does your staffing and recruiting software vendor spend your money? On innovation? Or just keeping up?

Your agency deserves an innovative partner that’s looking out for you and your business needs tomorrow. It’s up to you to ask: “What innovation have you delivered in the past three years that is unique to your software that will improve my business?”

If the software vendor can’t give you a clear answer, they are not an innovator.

The second secret is that they have to GROW.

Staffing software and recruiting software vendors must growIf innovation is the intellect that starts and sustains success for a staffing and recruiting software vendor, then growth is the result. Growth is the only true measure of success and acceptance in the marketplace.

Growth means that an increasing number of agency business owners recognize the value of the vendor’s software to their business operations.

But growth is more than just about the number of users and customers. Growth – the sale of more new software to more new users – provides the critically needed capital for reinvestment in the product, services, and, yes, innovation. In fact, I’d go so far as to say that it is financially nearly impossible for a software firm to sustain any kind of innovative thinking if they aren’t growing.

So how should you measure growth of your staffing and recruiting software vendor? At its simplest, the yardstick you should use is: “How many users and customers have you added year-over-year for one, three, and five years?” You want both numbers because if all you measure is the total number of users, that number can be skewed by one or two large customer agencies that are growing themselves.

What you’re looking for is a consistent pattern of growth over time. A good benchmark is the staffing and recruiting industry’s growth. It’s averaged about seven percent per year since 2010. Your staffing or recruiting software vendor should have somewhat similar year-over-year growth in their number of users and customers. If it’s greater than that benchmark seven percent, you’re looking at a leader in the market, if not, well…

A second yardstick you can use is to ask: “How much has your staff grown year-over-year for one, three, and five years?” This second measurement will offer insight into a different aspect of their growth; how they are growing internally in response to sales and the support of their customers. If the numbers you’re given don’t reasonably align with the growth in numbers of users and customers, they should be considered suspect.

Software companies are always growing, stagnating, or dying. You want to buy from the growing vendor.

Third, they have to ENGAGE.

Staffing software and recruiting software vendors must engageEngagement is the secret sauce in the recipe for success in today’s hyper-connected world. That’s one reason why many staffing and recruiting software vendors are touting whatever Customer Relationship Management capabilities their software may have.

But how’s their engagement with YOU, their customer? For many, it’s a quick “How are you doing? Everything alright? Good. Bye!” More often, it’s a panicky or irate call from you to THEM about what the software isn’t doing. That’s not the kind of engagement that fosters successful relationships, growth, or innovation.

Engagement means that the software vendor is relentlessly focused on YOU and your agency’s needs and challenges. They want to know every one of your pain points, just as they also strive to take a broader view of the staffing and recruiting industry and the issues and challenges that are important to and influence it. They engage because they must be constantly learning. It’s the only way to discover how they might be able to solve those problems through the application of technology or in collaboration with other resources.

They can only learn this by listening and learning through engagement with you.

It’s pretty easy to measure the software vendor’s engagement with you, as you’ll be able to see firsthand ample evidence of their efforts. They’ll work at engaging with you personally and frequently through a variety of means such as social media. They’ll coach you on how to optimize your use of the software. They’ll listen intently to your feedback on the software to correct defects and improve your experience. They’ll reward your loyalty and give you opportunities to weigh in on their new developments or innovations. They’ll have a high-profile at industry events as both attendees and presenters. They’ll generally strive to build a community of customers that is highly inclusive. Customers who are enthusiastic and eager to be references.

Here’s one measure of staffing and recruiting software customer engagement. Ask how many users show up for the software vendors’ annual user meeting – assuming they have one. In my experience, the customers who come to these events are often the most engaged and the most successful among their peers. A vibrant and engaging user meeting is a strong indication of just how committed the software vendor is to its customers, and to its vision. For example, Avionte hosted 350 users at its 2016 user forum. Even more impressive, Bullhorn had 1,000 attendees at its 2016 conference – that’s roughly equal to the number of attendees at the American Staffing Associations national conference!

Engagement is the catalyst that in turn fosters innovation and growth. You want a partner who is as engaged with YOU as you want to be with your customers.

Innovation, Growth, and Engagement – The Three Secrets to Selecting Staffing Software or Recruiting Software.

So there you have it. The three secrets to selecting staffing software or recruiting software that will help ensure that it will be successful for your agency. Go ahead and make up your RFP with all of its requirements. It’s a necessity. But before you send out that RFP, ask any prospective software vendor questions that will help you determine whether or not the software vendor is an innovator who is growing and engaging with their customers.

Those software vendors that successfully pass your innovation, growth, and engagement questions should be the only ones that are honored with your RFP.


Phil McCutchen is a B2B marketing professional with 25-years of experience marketing software to the staffing and recruiting industry. The observations presented here represent his own opinions. 

The Evolution of Staffing & Recruiting Agency Software

Evolution of Staffing and Recruiting Agency SoftwareIn looking back over the past 25 years that I’ve spent marketing staffing and recruiting agency software, I can’t help but marvel at the changes in the industry and the technology that supports its success. Just for grins, I’ve put together this brief outline of the evolution of staffing and recruiting software from the 1960’s to today – and my own vision of where I believe the technology will go.

1960's Staffing & Recruiting Software1960’s

The age of the dinosaur. Only the largest (national) staffing and recruiting agencies can afford the big, cumbersome, and frightfully expensive computer systems of the day. These are almost exclusively used in back office accounting and payroll support – essentially big calculators. Everyone else is using paper, pencil, rolodexes and filing cabinets. This manually intensive practice will continue for most smaller agencies for a decade or more. The staffing and recruiting industry is grossing in the hundreds of millions of dollars.

1970's Staffing software and recruiting software1970’s

The advent of mini-computers brings technology into the realm of affordability for aggressive mid-size staffing and recruiting agencies. A few home-grown solutions are offered for sale to other agencies for the first time. These systems offer rudimentary capabilities for back office accounting functions or act as crude electronic filing cabinets for candidate data. Staffing and recruiting agencies rely on the phone and classified advertising to find candidates and make placements. The staffing and recruiting industry hits one billion in gross revenues.

1980's staffing software and recruiting software1980’s

With the introduction of the Personal Computer the development of business applications exploded. Forward thinking (or frustrated) staffing and recruiting agencies develop relatively unsophisticated back office or front office programs to aid in their business operations, but none are as capable as the mini-computer systems which can network many end-users at once. While many repetitive tasks are becoming somewhat automated, most systems are still little more than glorified calculators and data repositories. Staffing and recruiting industry revenues grow to $10-plus billion.

1990's staffing software and recruiting software1990’s

PC networking enables the development of a new generation of more sophisticated multi-user systems for recruiting and staffing operations. Integration of front-to-back office functions leads to impressive gains in staffing agency operating performance. Mini-computer system use peaks in the mid-1990’s and begins its decline. The birth of the internet changes everything and foreshadows a globally networked future. Online job boards begin their rapid replacement of classified advertising. Total industry revenues accelerate past $70-plus billion.

2000's staffing software and recruiting software2000’s

Staffing and recruiting software based on PC networks grow in their capabilities, while the internet provides an ever-growing pool of candidates and the means to connect to them and to customers. The first internet web-browser based recruiting and staffing software solutions appear. These solutions mark the beginning of the migration to internet-based data centers (Software as a Service). The introduction of inexpensive laptops and smartphones empower staffing and recruiting professionals to operate with more mobility. Staffing and recruiting industry revenues crack $100-plus billion.

2010's staffing software and recruiting software2010’s

Software as a Service for staffing and recruiting overtakes self-hosted computing environments, even at larger agencies. Increasingly powerful mobile and smartphone capabilities permit 24×7 global staffing and recruiting operations. Numerous point solutions developed for tasks such as sourcing, background checking, and more are integrated. The first simple artificial intelligence (AI) based solutions appear in the form of chatbots or agents that are capable of mimicking some human recruiter activities. By the end of the decade, industry revenues pass $150 billion.

2020's staffing software and recruiting software2020’s

Most staffing and recruiting software solutions have migrated to the cloud. Large multi-national staffing firms begin using their data pools and the growing power of AI-based systems to relieve recruiting and staffing professionals of nearly all of the mundane tasks of the past. In addition, AI-based agents become capable of performing many background tasks autonomously; such as sourcing, advertising, chatting with candidates, and more. Most back-office functions become completely AI-automated. Staffing and recruiting revenues grow to nearly $200 billion.

2030's staffing software and recruiting software2030’s

By the end of the decade many staffing and recruiting positions have been replaced by AI-based systems, even at small to mid-size agencies. These AI agents have reached a level of sophistication that enables them to autonomously manage searches, sourcing, testing, and placement of most low-to-middle range job requisitions. Further, many customer service and sales positions that were common just 20 years before have also been eliminated with the rise of AI-based agents that are more efficient and less costly. Total industry revenues hit more than $250-plus billion.


1960's-2030's Evolution of Staffing and Recruiting Agency SoftwareDownload the full-size infographic here.

Phil McCutchen is a B2B software marketing professional with 25-years of experience in the staffing and recruiting industry. The observations and predictions presented here are based on his own research and future thinking and represent his own opinions.

Find Your Niche. Or Else.

Adapting to the environment is critical to thriving

Adapt and find your niche to survive and thriveThis past summer I was privileged to be able to check off one of my bucket-list adventures, a trip to the Galapagos Islands of Ecuador, along with a side trip to the Amazon rain forest along the banks of the Napo River, which feeds into the Amazon River.

One of the things hammered home to me was how symbiotic these special environmental ecosystems were.

On the Galapagos Islands we had the opportunity to get up close to marine iguanas, unique to the islands, who have adapted to the harsh environment to eat marine plants to survive. Nowhere else will you find such creatures. Descendants of land iguanas who somehow crossed 600 miles of sea, they had to change their diet and mode of living to survive. They now thrive in a fragile, interdependent ecosystem thanks to their adaptation. They’ve found their niche in the ecosystem.

Similarly, your staffing and recruiting can thrive by adapting to constantly changing business environments. The key to this is finding the most profitable niche for your staffing and recruiting agency within the business ecosystem. Jim Childs, Partner of Childs Company, a long-term veteran of the staffing industry as a CEO and investment banker, has stated, “Niche staffing and recruiting companies are always more valuable than generalist companies.” Childs further points out that, “The specialty players can have gross margins well over 30 percent due to their specialty focus and their mix of permanent placement revenue.”

Of course, becoming a niche player in the staffing industry is not without its challenges. You must develop a level of stellar expertise in your niche that makes you and your team more desirable to your customers than your competition. And you must deliver the quality candidates needed – always. Of course, in a singular niche you may not have much competition — which is key to profits. Also, you must be willing to give up other staffing and recruiting opportunities to be a niche specialist.

The point is that you must focus yourself and your team on your core niche competencies. That means that everything not central to the niche you target should be something you stay away from.

Where do you start? What kind of niche should you focus on? Perhaps one of the first places to look is, the Bureau of Labor Statistics’ National Employment Matrix, where you’ll find occupation and employment projections for the next 10 years. There are plenty of potential opportunities there for staffing and recruiting agencies to develop their expertise within. Maybe one will suit yours. Or maybe you’ll have to study further to discover the potential for your agency.

This is important because the world of work will change dramatically over the next ten-to-twenty years. AI-based systems will replace many low-to-mid-level sales and customer service roles. In fact, a cursory review of employment projections shows that you might find the most profitable recruiting niches to be in healthcare, personal care, and related fields.

Perceptive staffing and recruiting agency business owners and managers who stay obsessed with being the best in their niche will reap the financial rewards of leadership.

Of course, you can always do things the way you’ve always done them. In which case there’s a good probability you’ll end up like this poor fellow below. He didn’t change.