There are Good Things in the Short Straw

Tom Kosnik, President of Visus Group and Founder of Presidents' RoundTable, says he got into the staffing industry because he drew the shortest straw. Now, he will be the first to laugh and tell you that this was the best thing for him. Tune in as he and Lisa discuss the intersection of community and entrepreneurship, as well as the importance of examining your blind spots for business growth.

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All Lead Generation Tactics Are Not Equal

by Visus Group Partner Jay Mattern, CEO of  TerraFirma Marketing

All Lead Generation Tactics Are Not Equal

If you are utilizing outbound marketing to generate leads, how can you stand out from the crowd and generate optimal results? And by results, I mean getting readers/subscribers to do more than just open an email. Here are seven tips that will help you convert more leads into sales.

1.Stay True to Your Brand

Too often, email campaigns are generic and fail to convey the solicitor’s branded message. While it’s important to tailor your message to the reader and address their needs, your brand still needs to come through loud and clear. Even if your email is short and to the point, it should always be created in your brand voice and reflect your messaging strategy. 

2. Learn how to get and direct attention. 

The email’s subject line is certainly important but getting them to go beyond that will require a purposeful design and compelling content. How can you use design to direct the reader’s attention? By using the elements of motion, size, color, and positioning, you can subtly yell at the reader — “HEY, LOOK AT ME!” Here are some specific ideas:

  • Placing an element higher in the email is more recognizable than a lower one.
  • An element that is in contrast with its surroundings is more recognizable than one which blends in.
  • A larger element is more recognizable than one that is smaller.
  • Bold and/or italicized font stands out when used sparingly.

3. Never forget that conversion is the primary goal.

You should always be asking yourself “what do I want the audience to do?” Ideally, you want them to respond to your Call to Action – to click on the CTA button. That’s what we mean by conversion. The ultimate end of your sales and recruiting process is undoubtedly more involved, but the immediate objective of an email or ad is always to motivate the reader to want to learn more. You need to open that door.

4. Triple-check everything.

Have you ever clicked on a CTA (converted!) and actually wound up on an “Error 404 – the requested URL was not found?” Or the click actually did nothing. It is imperative that you check all of your links to make sure they all work as promised. This is your first opportunity to deliver on something you promised, and a poor impression here takes you out of the running.

5. Make use of urgency.

It’s well known that we tend to want what we can’t have. When something is rare, exclusive, or limited, it immediately makes it more desirable and more in demand. Use this same approach in your email marketing efforts. Limit your offer. Make it clear that immediate action is necessary, whether it’s due to a timeline you set or a seasonal/business cycle. Convey a sense of urgency.

6. Get to the point.

The best lead generation emails are written understanding that the reader’s time is scarce and you’re competing for their attention. No one will take the time to search for your message. It’s your job to package and present it.

  • Use bullet points to highlight key ideas. This will help the important takeaways easily stand out from the rest of the text.
  • Strategically utilize imagery (a picture is still worth 1,000 words).
  • Most important is a clear and inviting Call to Action. It should be just that – a “call” to the reader to do something.

7. Use landing pages.

To get the most from leads you generate, you should use a unique landing page designed specifically to convert the lead to the next step and move them into the lead funnel. A well-designed landing page will prevent the lead from being distracted by other messages or information that reside on your website and will focus them specifically on what the next step is.

Given the significant shift towards digital marketing and automated marketing solutions, getting a message through to a prospect or candidate is becoming increasingly more difficult. Your message must truly stand out and present itself uniquely in order to successfully engage the prospect. With deliberate focus and attention, you can optimize your email marketing results and more easily turn leads into results. And that is the ultimate goal.

When it comes to technology in your staffing firm, address these five areas first.

Technology in the staffing industry sure has evolved over the last few years. Right now, there are over 400 hundred technologies that are currently supporting the staffing industry. That’s right, 400+ technologies! How do you know which ones are new? How do you know where to start? How do you know which ones are the best ones for your staffing firm?

What I frequently hear from my clients and members is this: “I’m a business owner of a staffing firm, someone with a sales background. How can I possibly know how to make the right decision on technology?” It’s a valid question and one that has a variety of answers. The first step is to really analyze where you currently are on the technology spectrum ranging from low-technology firms, a smaller firm or one that doesn’t use too many products, to an enlightened staffing firm, one that has built out their tech stack and understands how to leverage their IT department for greater efficiency. The reality is that many are on the former side. 

The good news is that we are in a unique position, through our Presidents RoundTable, to get exposure to all the IT challenges that staffing firms of all sizes face on a weekly basis.  Through all of these stories and consulting moments, we’ve identified five critical areas that staffing firms need to address within their IT strategy:

Align your technology stack to your business model. 

What is your business model? Define it. Know it. Map it out. And then determine what is the best technology to help you implement that business model in the marketplace. The number one error we see staffing business owners make is that they get enamored with shiny new technology. Or, they hear from their Sales Reps & Recruiters, “We have to have this new technology! This new technology will be a game changer for us!”  

The worst mistake you can make (as it relates to IT) is fitting the technology to your process. The replicable business model is the anchor (the key criteria) in which all decisions on technologies are judged against. It is that simple. A simple decision-making tree will help any staffing firm make far better IT decisions. And knowing what specific business model is being implemented.      

Decide who will manage your technology.

The makeup of your IT department can have an enormous effect on how fast or slow you are to new technologies. There are essentially two structures – in-house IT or Outsourced. 

Outsourcing: If you are a small Owner/Operator staffing business you really have no choice, but to outsource as your payroll is best served for recruiters and salespeople. In this model, you will be paying for work done, some monitoring, but you may not see the dedication this company may have to building an IT roadmap as they will be in maintenance mode for you. The key here is to find an IT Support firm that aligns with the size of your firm and has your firm’s best interest at heart.  

In-house: If your firm is midsize to enterprise, then you will most likely have IT personnel on your staff. The biggest challenge here is having the right person in the right seat. When you do, they are truly your IT QB owning the roadmap, procuring powerful vendor relationships, and getting themselves involved in your business to help make your processes better through automation. On the other hand, we have seen staffing firms held hostage by in-house IT personnel that “had all the magic passwords” or were unwilling to think critically. There are a lot of fantastic IT professionals working in companies. You just want to make sure you have someone that does not put job security over the company’s best interest.       

Think about your integration strategy. 

Let’s be honest, there is no staffing firm 100% happy with the ATS they are currently utilizing.  Every ATS has challenges, wonky processes, or lack of wish list items. Also, every ATS has challenges customizing to an individual staffing firm’s specific business model. Your business could be part of the problem. How? Let’s think about three things. (1) Not fully vetting the capabilities of the ATS to the business need. We know of several staffing firms that implemented an ATS and in less than 18 months later switched to another ATS. Why? Because they didn’t stick to their business model. Define it, know it, then go out and find the best ATS that helps you implement that business model in the marketplace. (2) No ATS will be perfect. Just accept this fact. There is a front office, middle office, and back office. The reality is that most of the ATS’ in the market are for front office needs – recruiting and sales. It is no surprise that the middleware and back office can be suspect in many ATS platforms due to their focus on candidates and placements. (3) Integrated System Versus Separate Systems: this is a very big decision. Do I have one system where my entire process is integrated or do I find a fantastic front office and then find a separate middleware technology and back-office technology that becomes semi-integrated into that fantastic front office technology? There are pros and cons to both strategies and it just matters how this works with your business model. Also, a final consideration here is identifying your subject matter experts or those super-users who will help ensure the technology is running and all are abiding by the process.

Acquire a true technology leader.

As many of you know, we sponsor peer RoundTables through the Visus Group. Over the last several years, we have been asked to start a CIO RoundTable on many occasions, but we failed to get traction from this type of RoundTable. This RoundTable was meant to provide an outlet and community for IT leaders to discuss tech stack, current trends, and product roadmaps. Why did this fail to attract a following and what information did we gather from this? Outside of a lack of demand, it told us that many staffing firms really do not have a “true” technology leader on their staff. Rather, these staffing firms had “director-level” personnel on staff focused less on strategy and more on infrastructure and tech support. Instead, the technology strategy and roadmap responsibilities fell under the COO. In my opinion, this is not the right approach for larger staffing firms. Regional and national staffing firms need a true CIO on staff because technology is transforming the staffing industry at a record pace. Having an experienced technology leader on your leadership team ensures you have someone who understands how to evaluate new technology and translate it into current processes and overall roadmap.            

Secure your technology budget.

The most important part of the equation – a technology budget. When you add up your tech stack costs between servers, ATS, phone, hardware and software to run your business, it all adds up quickly! Yes, this is all part of your IT budget, but is this a true representation of your entire IT spend? And can you calculate any cost savings or ROI? Many of our clients don’t know where to start or end with budgeting and determining the true ROI (return on investment) on technology investments. Our rule of thumb is this, if you invest in innovative technology and it does not increase the average gross profit production per internal production personnel, then it must not be the right technology for your business.                   

Technology has become an enormous area for staffing firms to conquer with the onset of new players and the pandemic increasing the need for digital transformation. As mentioned, these are the five areas I would circulate to my leadership team if I were in your shoes at your staffing firm. How can you correctly identify the technology that will work best for your firm without sacrificing wasted investment, additional processes or underutilized platforms? This is where the Visus Group comes in. We assist staffing firms by assessing their existing tech stack and make prudent decisions which align with your business model. Don’t get caught making the wrong decision – let’s chat!

Seven Most Common Mistakes to Avoid When Making a Staffing Firm Acquisition

With over 20,000 staffing and recruitment firms in the industry, there are always mergers and acquisitions that occur. According to Duff and Phelps research 115 staffing industry M&A transactions were completed by 96 unique buyers in 2020. This was a 20% decrease from the 143 transactions completed in 2019. Strategic buyers accounted for 85% of the staffing industry acquisitions in 2020, with private equity funds (financial buyers) investing in new platform acquisitions accounting for the other 15% of transactions.

Of the 115 transactions reported in the 2020, 44 involved companies whose predominant service offering was IT staffing and/or IT consulting. Healthcare staffing is another historically attractive sector, with 16 transactions completed in 2020.

We’re seeing that in this post-Covid era, a lot of staffing firms are in the market to acquire, but unfortunately, few do it well. Buying a small competitor or acquiring in a new market to get into that market sounds fun and sexy. The fact of the matter is that there are tons of places to make mistakes, whether it be wrong fit, not enough education of the financial indicators, or just being a novice to the valuation process.

In this short blog, I am going to outline some of the common errors I see buyers making in their attempts at acquiring a small to midsize staffing firm.

  1. Synergy & Trust: The number one thing a buyer needs to do at the onset is to establish synergy and trust with a seller. In fact, a buyer needs to actively build synergy and trust through the entire process. Why? No seller is going to sell their company to a person or group they do not trust. It is that simple. Building trust takes time and work. I see it often overlooked.
  2. Breaks in Communication: No news is bad news. Setting up weekly or bi-weekly calls to stay connected, move the process along, resolve issues, establish credibility, walk through information given and received is critical to success. When there are breaks in communication a buyer is simply communicating to a seller that they are not interested. Not good.
  3. Lack of Flexibility: No two deals are the same. No two sellers are the same. Buyers may have a preferred way in which to acquire a company, but when buyers approach the market with a “one size fits all” strategy, specifically regarding to the way they plan on structuring the payout of the acquisition, then they are just going to leave a lot of potential deals on the table. 
  4. Lawyers: I see this error often with new buyers. Namely, they utilize a lawyer that does not have staffing industry experience. Big mistake. A buyer’s legal provider is likely to have M&A council on staff, but how much experience does this council have in getting staffing acquisitions across the finish line. I have seen a lot of deals go sideways simply because the buyer’s lawyer did not have the expertise in staffing.
  5. Lack of Focus: Nail down an acquisition profile and stick to it. Yes, stick to the profile. Such a profile is going to address the issues of size, geography, staffing niche, etc. Going to the market haphazardly or “opportunistically”, as I commonly hear, is only going to set up a buyer to waste a lot of time chasing a lot of deals that are only going to get washed. Get focused and stay focused.
  6. Money: Get the money lined up and secured. To start looking for acquisitions prior to having a bank on board and money lined up is only going to delay the process of acquiring a company. It is also going to communicate red flags to a seller. Most sellers will require “proof of funds”. The point here is to get your bank on board on the front end prior to going to the market. 
  7. Not Using a Cultural Assessment: This is so effective in understanding if an acquisition is going to be a good fit. Find a tool or hire a consultant to conduct a cultural assessment on the buyer. Understand the buyer’s cultural preferences. Survey the potential acquisition using the same cultural tool. Determine if the acquisition target has cultural preferences that match the buyers. If a buyer acquires a firm where there is not a good match, post-acquisition is going to be ugly. 

Here are just seven points here where buyers make common mistakes when acquiring companies, but there are many more. I will tell you, if you want to lose a lot of money, go do an acquisition without the appropriate assistance. 

Here at the Visus Group we have 75+ staffing firms in our RoundTable program and over half of these members are actively seeking acquisitions. If you are looking to get orientated into doing acquisitions, think about our advisory services or joining a RoundTable and learning from staffing firms that have a track record of successfully getting deals done.