Tom Cooksey
Posted: June 2023
I get it – first and foremost, recruitment is a sales environment. The front-office gets much of the focus in terms of resources, funding, and tooling. It’s the lifeblood of any recruitment business because if leads and candidates aren’t flowing then everything else is pointless.
Scaling your recruitment business
However, as you grow and scale your recruitment business, your ability to continue that throughput will be reliant on a good back-office process. Your business needs to be compliant – from right to work checks, documents tracking and background checks. The list goes on.
Very often this process is managed by the unsung heroes of the recruitment world, the compliance team. Their complex work involves bolting together various bits of process using Excel, online forms, email and sometimes good old-fashioned pen and paper. It will often be an area of your business that you don’t think about too much because that complexity is very well hidden by highly capable compliance & back-office managers.
But the truth is there is more to it than meets the eye. Things like candidate experience, GDPR compliance, and a repeatable, consistent process are so important.
At the moment, the vast majority of recruitment businesses rely heavily on people carrying out manual processes.
Fundamentally these processes are not designed with speed, efficiency, and security in mind. They are largely cobbled together because they don’t get the attention they deserve.
So, as an owner or director of a recruitment business, why should you care? I expect you’re thinking that your current process seem to work fine. I could of course suggest modernising your back-office because you need to “move with the times” or because being more compliant is “best practice”. However, we all know that these arguments are not enough to truly drive change in this area.
No, the real reason you should pay more attention to your back-office can be summed up simply as Cost & Scale.
Exploring the costs associated with compliance management
Let’s deal with cost first. You either have a compliance team, outsource your compliance, or don’t really worry about compliance.
Assuming you do have some kind of process, it’s almost certainly reliant on people. People who are often carrying out manual working across different systems, filling in spreadsheets, re-opening those spreadsheets (If they remember to check things like expiring documents), running qualification and background checks, and sending onboarding packs via Email.
The fact is people are expensive if their main role is to carry out manual work which can be easily automated. This doesn’t spell the death of the Compliance Manager. Far from it. But it’s about giving these highly skilled people the right tools. At the moment they bring in fairly low skilled people to operate the manual processes, train them up which takes months only to watch them move on to something more interesting because they are de-motivated with boring tasks. The alternative is that the Compliance Manager doesn’t have any help and must do absolutely everything. This leads to them being spread too thinly, stuck in the weeds and unable to be more strategic.
If you outsource the compliance process, you’re effectively paying people in an external company to carry out the work on your behalf. In many ways this is worse because you still suffer from all the inefficiencies of using people for manual tasks, but they’re not even dedicated to your business and your brand.
Automating much of the process means you’re able to optimise the number of people you have in the back-office team and therefore reduce cost. Furthermore, the people who remain are able to take on a wider remit because their time is freed up driving cost savings even harder.
Scaling beyond growth: The significance of sophistication
When it comes to scale, this isn’t necessarily simply about growth. It’s also about increasing your business’ sophistication. This is important for several reasons but if your goal is to grow and/or sell your business you are going to need a back-office environment that’s in good shape to come along for the ride.
As you move into different markets and win larger clients who have greater expectations of their suppliers you can’t continue to operate on Excel spreadsheets and a load of people.
Similarly, many recruitment businesses as they grow rely on recruitment consultants to play at least a part in the onboarding and compliance process. This might be sending out onboarding packs, emailing things across to the compliance team and then chasing the candidate.
All of this means the consultant is not out selling which brings us neatly back to the very start of this article. If you’re not driving sales into the business, you might as well all pack up and go home. If we can save even 10% of a consultant’s time, across a team of 10 that’s effectively an extra person at no extra cost
Ask me anything
Please keep an eye open for our next article. In the meantime, let me know if you any questions or comments relating to the topics discussed above.
About The Author:
Tom Cooksey
Tom started work as a software engineer for brands such as EA Games, The National Lottery and Sky. He went on to build a successful software consultancy with clients including British Horse Racing Authority and Nationwide Building Society. After exiting he went on to found IR35.io which was acquired by The Kingsbridge Group – Tom now heads up Elements, building on this previous success.
