Core Competencies of Staffing Agencies

Nov 17th, 2016
Core Competencies of Staffing Agencies

'All staffing agencies are above average' if you go by what they say. They all have a proprietary database of candidates, the best hiring processes, the best recruiters, the best customer service, and the most loved by contractors and customers. However, ask a contractor or a customer and the response is mostly 'meh- that they are all the same'.  What gives?

Core Competency is the single-most (core) unique capability of company which is the key differentiator that makes their product or service different than everyone else. While Google might be great in project management, software development or design, their single 'core' competency is their search algorithm design.

For Nike, it is Marketing. Sure shoe design, manufacturing and their operations are important in their success too, but as any shoemaker will concede, they could match Nike in those fields but still wouldn't be able to sell as many shoes due to Nike's marketing success.

As the leading staffing agency directory that helps jobseekers and clients identify the best, we try to identify the core competencies that separate the best staffing agencies from the rest. How does a small staffing agency suceed against a large multinational one? How does it build its staffing agency brand? How does an unknown company get selected by the most desirable company? All functions at the staffing agency are important but they are not core competencies.

Based on what we've learned over a number of years, these are the most common core competencies we see in staffing agencies.

Core Competency 1: Sales- Getting selected to the preferred vendor list for the best clients

Nothing differentiates a staffing agency more than its client roster. The number 1 reason a candidate talks to a staffing agency is the job they can offer them- the client is the number 1 reason a candidate considers a job as ‘cool’. Finding and convincing a top company to use them is a core differentiator and hence a core competency for staffing agencies. This may sound simple in theory- but even the best staffing agencies often can’t crack into a desirable customer and often have to buy their way in by acquiring an established staffing vendor.

Core Competency 2: Sourcing - The ability to source the best candidates from unique sources

Most staffing agencies claim proprietary candidate databases or long tenure in business, but in reality neither of this is a real differentiator. There are two types for sourcing competencies

Sourcing Reach- This is where large multinational firms claim an upper hand by virtue of having recruiters and offices all over the world.

Sourcing Niche- This is where a small agency or consulting shop can claim access to the most skilled workers in that skill.

Staffing agencies that have sourcing as a core competency have recruiters that deeply understand the requirements, can explain these really well to candidates, and know unique places or have unique access to where these candidates hang out. They may have great in-house referrals, have a trusted pool of corp-corp sub-contractors, h1b visa ready candidates or a large offshore sourcing team that scours the hundreds of job boards.

Core Competency 3: Screening- Being able to judge if a candidate is any good

Any staffing agency can search resumes by keyword matching and talk to a candidate and submit them. After a few bad submissions, hiring managers start ignoring resumes from such agencies and they are left wondering why they are not closing any positions. The good staffing agencies realize that the best way to build a relationship with a client is by giving them the best candidate in the market that solves their problem. Even if the rate is higher, even if they are lacking certain skills. They know a manager will compromise on the job description if a candidate is really good.

This can only be done by a staffing agency that spends time in understanding the requirement (rather than the keywords) , has a technical person interview candidate – for overall skills not just what is stated in the job description and only presents the best candidates. If a manager hires a contractor and starts trusting a vendor to deliver quality candidates, no procurement manger will ever convince them to change their vendor for a lower price.


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