5 key secrets of successfully scaling your staffing business · 2020-06-09 · stages/revenue sales...

© 2012 Crain Communications Inc

5 Key Secrets of Successfully Scaling Your Staffing Business

Greg Palmer, Managing Partner, G Palmer and Associates

Concurrent Session: Operations & Finance Track

Tuesday, Oct. 16 | 11:45 am | Ironwood 2

© 2012 Crain Communications Inc

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Concurrent Session: Operations & Finance Track

5 Key Secrets of Successfully Scaling Your Staffing Business

How to Successfully Scale: The 5 Key Steps

4

Mitsui

5

What are the Characteristics of Scale?

Revenue

• Faster growth rates than Industry

Profit •Greater Profit %’s than Industry

Satisfaction

•High Employee •High Client•Low client

concentration

Sustainable Model

And

And

6

You vs. Peers

7

5 steps to Successfully Scale

1. Create the Plan, Strategy, Budget ,Vision

2. The Leadership

+Team 3. Set up the

Model & KPI’s

4. Communication

& Meeting Rhythms

5. Track Adjust / Tackle the

Choke pointes

8

Employee/ Customer Satisfaction

Vision and Strategy – Step 1

$$$

Best in the

world @Passion

What is your Vision and Strategy?

How did you determine this for your organization?

What decision filter did you use to create it and maintain it ?

Source : Jim CollinsHedgehog Concept

x

9

“The Plan” – Step 1

10

StrategyVision

The Plan

Execute

3 Questions to Ask:

1. Vision and Mission2. Life Style company vs. sustainable

Business3. Exit Strategy

Life Cycle of A Business:Where are You ?

Idea and Planning

Mature

11

Entrepreneurial (Processes structure added) Bureaucratic(external focus) New Talent added ( Internal focus)

Time Line

Step 2 – Talent Plan “Internal”What- Why- How

• Training•OJT•Opportunity•Challenge

• Comp•Base•Incentive•Equity

• Retention•Personal growth•Culture•Comp•Equity

• Recruiting• Industry vs. no industry• Education• Personality• Experience• Culture fit Recruiting Retention

DevelopmentCompensation

12

Adding Key Talent – Step 2When?

Source SIA

13

Step 2 – Who Do You Want on the Bus? $0 - $25m

Stages/Revenue Sales / Recruiting CEO/CFO/EXE FounderInfancy $ 1m

Clear Profile

IncentivesShort term/Long term

Clear expectations

FoundersBook keeperCPA

Active

Rapid Rate$5 -10M

Same+Sales Manager

Same – top grade Active

Adolescence$10m - $25m

Same+Sales manager

FounderCFO/CIOOther Executives

Thinks about adding COO or CEO

Prime$25m

Same+VP of Sales

CEOCFOOther Executives

Chairman or Board or exit

14

Step 2 -Talent Plan “Contactors”

Industry Grade commentSourcing A to C

Screening A to B

Forecasting/ Recipe

D

Process D

Inventory of Skills F

Shelf life of inventory

F

Candidate Care F

“Most organization are too busy, being busy to focus and solve the recruiting challenges they face ” – Tim Alderman

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Step 2 - contactors “A” Talent + “A”Orders =CRQ Matching Process

Commitment Rate Qualifications - talent

AvailableEagerVerifiable time lineAgrees to interview timeGeography is a good match

Market PayNot ridgedMarket knowledge

Has 90% of skills neededHas 90% of experience neededGood culture fit

Commitment Rate Qualification - Job orders

Single providerAbsolute P.O.Interview time has been established

Market BillNot ridged Market Knowledge

Well thought out Job descriptionCandidate matches 90% of skillCandidate matches 90% of experienceGood culture fit

“A “ Candidate

“A ” ClientCRQ matching Process

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Model/KPI’S – Step 3

• Recruiting KPI•Emails / calls/ presents•Interviews / close•Ratio’s

• Sales KPI•Connects/

Interviews/Extensions

• Financial•GP%, Labor % of

GM•Debt to Equity

• Productivity• GM/FTE• $3000/$5000

HUB/Branch Systems

FocusCulture

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Step 3 - CEO Dash Board

Cash/DSO

GM/FTE SaleKPI

RecruitingKPI

NewA Candidates

New

A orders

New

Accts

WeeklyAccountsBilled

GP%EBITDA%

Compliance

$ on hand

AR

40 days

$3000/$5000

Calls

Emails

Connects

Time on phone

Calls

Emails

PresentationInterviews

X per week X per week

X per week

xx30%

10%

100%

Disciplined Activity = Results

18

Timing – Invest, Cut Back, Sell

19

GDP% growthTemp growth

rate

Source : GPalmer

Recession

19

How and How Much to Invest?

Expenses - 75% of Revenue Growth

rate

Balance sheet3:1 Quick Ratio

Labor-Variable Vs.

Fixed

20

Account Rep Breakeven(BE)Assumptions:

Fully Loaded cost = $60k , assume $60 bill rate, 20% gp

---------------

$60 bill rate x 20% GP = $12 GM per hour

$60,000 ( acct rep ) / $12 = 5000 hours a year to BE

5000 / 52 week = 96.15 hours per week to BE

96.15 / 37 ( hours worked contractor ) = 2.59contractors on billing per week BE

21

Want to Improve your Profit 20% increase your GP% 1%

Profit % = 5%

Improvement = +1%

Total 6%

1% of 5 % = 20%!

22

GM /FTEGM/FTE$ EBITDA% % increase Productivity %

increase$3000 4%

$4000 8% 50% 33%

$5000

On AssignmentQ2 2012

$4846

12% 50%

11.4 %

66%

23

Meeting Rhythms & Communication/Culture –Step 4Sample communication and meeting rhythms

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Weekly

Recruiting calls

Sales/ Ops Dashboards

Strategic issues

Forecast

Monthly

P & L

AR/ cash

3 key issue

Forecasts

Quarterly

Advisor meeting

Annually

Year end recap

Next yearplan

Next year budget

Removing the Choke Points Step 5

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Q 1 Action Who When Resource needed

Q2 WageManagement

Bob 3/31 Bill register

Q3 Price increase Sue 9/15 N/A

Team MemberBig issue Improve

GP% Goal 1%Story

How to Get Started5 steps Current

Grade (A,B,C,D)

Expected Grade(A,B,C,D)

When Leader

1.Plan,Stategy2.Teaders/Team3.Model/ KPI’s4.Meeting Rythms5.Track/Solve choke pointsClient/Staff Satisfaction

26

The 5 Deadly Sins of Scale

WhatWhy How

No Talent recruiting

and retentionPlan

Too man Priorities

Lack of MeticsLack of

accountability

Lack of Focus

You know They know

Everyone knows

Hold on to Talent too

Long

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High client Concentration

NO PRICE IMPROVEMENT CULTUIRE

Resources 28

6th Step – Emotional Attachment

Transformational(self actualization)

Success(Social, Belonging

Esteem)

Survival(Physiological & Safety)

Employee Satisfaction Customer Satisfaction

29

Thank You!Greg Palmer

GPalmer@cox.net

www.GPalmerandassociates.com

949.232.7101

30

© 2012 Crain Communications Inc

Give Us Immediate Feedback

A B C D F294268 294269 294270 294272 294273

Please grade your satisfaction with this session on a scale from A (highest) to F (lowest) by texting your grade to #22333.

Concurrent Session: Operations & Finance Track

5 Key Secrets of Successfully Scaling Your Staffing Business