What Matters Most in an Elimination Round When Selecting Staffing Agencies? | DCR Workforce Blog

What Matters Most in an Elimination Round When Selecting Staffing Agencies?

What Matters Most in an Elimination Round When Selecting Staffing Agencies(“Originally published on SIA Staffing Stream, December 08, 2014.”)

My daughter is an avid follower of Masterchef Australia. I recently got pulled in to watch a tough elimination round where both semi-finalist contestants dished up outstanding items. The criterion the judges applied to decide who advanced to the next round in the contest was illuminating, to say the least. It was simply this: Who did a better job on the core ingredient of the dish – in the way it was cooked?

An elimination round which poses a similar challenge to the players in our industry would be: When organizations choose staffing partners, what are the criteria they apply? Are the factors used five years ago still applicable today? Does each carry the same priority as it did previously?

One thing is for sure. We have multiple criteria which are of importance in the staffing world.This fact makes it very difficult to determine their importance and choose just one (or only a few) of greatest importance.

As the Managed Services Provider for many clients, DCR works directly with hundreds of staffing agencies, and is frequently involved in our clients’ selection of preferred staffing agencies. We noticed an interesting phenomenon:

In many programs, there is a significant disconnect between the clients’ stated supplier selection criteria and the actual selection criteria applied.

We asked DCR’s analysts to investigate further. A survey of 85 companies was conducted in which the Request for Proposal issued by the company was compared to the actual selection criteria applied to creating a preferred vendor list. It revealed the following:

Ranking

Alignment of Supplier Offices with Client Hiring Locations. DCR found that the responses varied by the types of skills needed. Clients with large populations of general commercial (LI/Admin, Clerical) workers were seeking local support. Those focused on Professional and Technical workers were less concerned about this issue. The use of social recruiting has also decreased the priority of this requirement.We should note that there was a wide variance of responses, and the rankings reflect the weighted average of these responses. While additional research would be needed to validate these results, there are some indicators that could possibly be derived from this analysis.

  • Overall Market Ranking (Volume of Business in Staffing Specified Skill Set(s)). The old notion that big equals best continues to linger, although many clients expressed concern regarding the importance that the largest staffing companies would place on their account.
  • Experience in Client Industry. With few exceptions, clients who claimed this was a priority actually selected suppliers with little or no specific experience or references in their industry.
  • Assignment of Dedicated Recruiter(s). While many RFPs asked if dedicated recruiters would be assigned, the requirement was typically not mandatory, and was not a top priority when ranking candidate submissions. However, most respondents did indicate that they were seeking agencies who understood their priorities, culture, core criteria for candidate quality and training needs and the urgency that drives their requirements.
  • Cost/Mark-Up. In each RFP, the client indicated an unwillingness to jeopardize the need for quality and response time by choosing the low cost vendor. However, all else being equal, vendors asking for lower mark-ups were selected.
  • MWBE or Veteran-owned Supplier. While many respondents stated that establishing a diverse supply base is of importance, it was clear that vendors were not chosen on this criteria alone.
  • Existing Business Relationship with Client. While all RFPs stated that preference would not be given to the existing supply base, results indicated that companies leaned toward incumbent staffing agencies whose work was at least satisfactory. Most respondents indicated that “it is too much effort to change.”

Other factors emerged that set some staffing agencies apart from others and make them the winners.

  • Insight into the buyer’s decision process, selection team and pain points. Respondents preferred responses that spoke directly to their situation, even if the vendor had no relevant experience with the client’s industry. Most selection decisions were made by a committee. Savvy suppliers evaluated the composition of that committee (Procurement, HR, other) to determine points of emphasis in their proposals.
  • The staffing agency’s relationship with candidates was sometimes evaluated as a predictor of worker performance potential attrition rates.
  • The ability of staffing partners to include technological advances offered by the industry in establishing an employer brand, creating talent pipelines (by networking with new sources while staying connected to alumni), using advanced methods in recruitment like mobile technologies, videos, social media networking was a factor in anticipating the vendor’s turnaround time and candidate quality.
  • The supplier’s track record for compliance with corporate screening policies, financial administration, safety procedures was considered by all companies. Compliance is growing in importance in vendor selection.

Now, it is up to you to decide which of these factors takes precedence over the rest. Of course, nothing is etched in stone. In our experience, what truly matters most in winning new business is understanding and speaking directly to the needs of the prospective client. And, once selected, making good on every commitment made during the selection process. The best sales strategy is always to deliver great customer service.


Disclaimer:
The content on this blog is for informational purposes only and cannot be construed as specific legal advice or as a substitute for competent legal advice. They reflect the opinions of DCR Workforce and may not reflect the opinions of any individual attorney. Do contact an attorney for advice specific to your issue or problem.
Lalita is a people/project manager with extensive experience in operations, HCM and training and development across industries like banking, education, business consulting, BPO and information technology. She believes in a dynamic approach to life and learning as change is the only constant.