IT firms put pedal to metal with culture, focus, obsession …
By Craig Johnson
Information technology staffing firms dominate the list of high-achieving staffing firms. More than half of the companies on Staffing Industry Analysts’ 2012 list of fastest-growing staffing firms cited IT as their main business line. There are a number of reasons for this (See “The Star Burns Bright”).
And the segment appears poised for more growth. The size of the IT staﬃng market is expected to reach a record level of $23.1 billion in revenue in 2012, according to Staﬃng Industry Analysts estimates.
Still, just being in IT isn’t everything. Fast-growing IT staﬃng ﬁrms have earned their success by focusing on a couple of specialized techniques. And they are not resting on their laurels. They will continue to do what works, and at the same time innovate to meet market demands.
We spoke with several ﬁrms that ranked among the top 10 fastest-growing staﬃng ﬁrms. This article explores common traits including maintaining a recruiter culture, keeping your focus and being obsessed with service. Here are their stories about what makes them such star performers.
At Mindlance Inc., the focus is on serving the vendor management system/managed service provider market.
And that focus appears to be working. The Hoboken, N.J.-based professional staﬃng provider — which counts IT staﬃng as its largest business line — ranks No. 10 on the list of fastest-growing staﬃng ﬁrms with ﬁve-year compound annual growth of 43.1 percent. It also ranked on the 2011 list of fastest-growing staﬃng ﬁrms.
“About three years ago we made a conscious decision to focus on VMS/MSP business,” says Vik Kalra, managing director of Mindlance. “Everything was built and conﬁgured to support VMS/MSP business … We created a recruitment-focused organization.”
The ﬁrm concentrates on coverage, speed, pricing and quality as part of its focus on the VMS/MSP business.
Kalra says the ﬁrm took that route because it perceived itself to be a stronger recruitment-based organization than sales.
Mindlance has centralized recruiting hubs in both the U.S. and India as part of its VMS/MSP focus. Kalra says the operations in India helped give the company scalability and a long-term cost advantage. It also allowed the company to provide dedicated recruiting on accounts from the proﬁtable to the not as proﬁtable while some of Mindlance’s competitors might look at VMS bill rates or markup as unattractive.
The company is also very candidate-focused, continuously pipelining and building a pool of personnel, Kalra says. Its operations include a high-touch candidate model to bring in the workers with the top IT skills.
“They have a choice of vendors to go to and you want to be that employer of choice … you need to build a brand name and relationship so people with those skill sets come to you,” Kalra says.
Recruitment is also important at Principle Solutions Group. The Atlanta-based IT staﬃng ﬁrm ranks No. 2 on the list of fastest-growing staﬃng ﬁrms with ﬁve-year compound annual revenue growth of 70.9 percent.
“To really grow revenue, you can’t just sell your services and get on approved vendor lists; you have to deliver and make those placements,” says Joe Ventura, managing director at Principle Solutions Group. To do that requires consistently providing better candidates than competitors.
“We have 35 technical recruiters within our company, all well-trained, energetic, compassionate people who understand technology,” Ventura says.
In fact, the company has a special focus on recruiters.
In some IT staﬃng ﬁrms, the relationship between recruiting and sales is non-existent or broken, Ventura says. Recruiters may also be underpaid or undertrained. But Principle Solutions Group works to foster closer communication between the two groups. “We do a lot of exercises to build that trust,” Ventura says.
And recruiting isn’t merely a training ground where people ultimately move up into sales, he says. Workers can have a career in recruiting.
“This is a place where recruiters can really thrive,” Ventura says. “Here you can build a career in recruiting … [Recruiters] have the opportunity to be successful, and there are a lot of opportunities to lead and train others.”
Overall, becoming aligned with some of the top companies in the country as customers and hiring the right people has enabled Principle Solutions Group’s team to drive growth, he says.
“When we are able to get the best accounts, and when recruiters enjoy working here, we know that we’re doing our job right,” Ventura says.
Further, Principle Solutions Group enjoys a low turnover rate, he says. And the company was named to the Atlanta Journal-Constitution’s 2012 top workplaces list earlier this year.
Service Is All
Tricia Dempsey, founder and CEO of Agile in Alpharetta, Ga., said her ﬁrm made a conscious decision to focus on the small to mid-market — serving ﬁrms with revenue of less than $1 billion.
Agile also sticks to providing a core of skill sets — software development, quality assurance, project management and business analysis.
The strategy appears to be working. Agile ranks No. 3 on the list of fastest-growing staﬃng ﬁrms with ﬁve-year compound annual revenue growth of 65.0 percent.
However, the mid-market and core skills aren’t the only keys to the company’s success. Dempsey describes the ﬁrm as having a “service-obsessed” culture.
“We don’t give up on our client’s jobs,” Dempsey says. That means the ﬁrm remains committed to making the placement. “I think most of our competitors try to ﬁll the job quickly but don’t have the same commitment once the job gets old,” she says.
Training is also a key to Agile’s success. The company has an internal, dedicated trainer on staﬀ. In addition, it has an online platform where internal employees can go to exchange information such as “which area ﬁrms hire .Net resources.” Internal employees contribute to the platform by uploading informational blogs, screencasts or even videos.
Dempsey is no stranger to focus. She began the company in 2003 in the midst of a personal battle with breast cancer. She just celebrated 10 years of being cancer free, and Agile is a strong supporter of the greater Atlanta aﬃliate of Susan G. Komen for the Cure. The ﬁrm puts on an annual golf charity event called “Agile on the Green” and Dempsey sits on the local Komen organization’s board of directors.
The IT staﬃng segment as a whole remains one of the faster-growing segments of staﬃng. But as the market reaches a record size, growth of the segment is expected to ease.
While the market recorded an estimated 15 percent growth in 2011, it’s expected to grow by 12 percent in 2012. The growth rate is projected to decelerate further to 8 percent in 2013. Competition from IT solutions ﬁrms will contribute, in part, to that slower growth, according to an analysis by Staﬃng Industry Analysts.
Still, the IT staﬃng ﬁrms we spoke with remain optimistic about the path ahead.
Ventura says Principle Solutions Group is not interested in haphazardly dotting the map with oﬃces, preferring strategic growth where it will make an impact. Many times, client demand has driven expansion at the ﬁrm, he says. The ﬁrm presently has oﬃces in Charlotte, Greensboro and Raleigh, N.C., and is headquartered in Atlanta.
Dempsey says Agile moved into a larger oﬃce space this year that will house 2½ times as many people as its former oﬃce space. She also sees opportunities in segments such as health IT and the ﬁnancial services area. The ﬁrm’s permanent placement business has also been growing and helps fund Agile’s investment in hiring new people.
Kalra also sees plenty of room for growth at Mindlance.
Of course, there can be challenges.
As a company grows, there’s a tendency to “optimize” rather than “maximize,” Kalra says. A mom-and-pop ﬁrm with one client will maximize their eﬀorts on that one client. As a ﬁrm gains more clients, it may tend to manage its resources and stop treating all clients as important. Making business decisions such as that may be a sensible way to run a business. But when it comes to customer service and recruitment, a ﬁrm must still “maximize” eﬀort to clients, Kalra says. That means treating each client as if it were the ﬁrm’s only client.
The overall market also presents challenges.
Kalra says IT has gone through several paradigm shifts over the years. The Y2K initiative before the year 2000 created demand for IT services among clients that was greater than what was needed to simply maintain their existing systems. Then the dot-com boom boosted demand for IT services. And right now things are more to do with cloud computing.
Keeping up with change in IT — which is now happening faster than ever — will be a key for IT staﬃng ﬁrms. That includes what new changes or technologies could lay around the corner.
“I think the challenge of staﬃng companies is how to take advantage of that opportunity, and not let that be a liability for us,” Kalra says.
Craig Johnson is managing editor, staffing publications, at Staffing Industry Analysts. He can be reached at email@example.com.