This paper will aim to solve how digitization, with the help of RPA, can eliminate mundane tasks and increase documentation, leading to higher productivity for employees of staffing and recruiting agencies. Digitization is a problem for organizations who employs a staff that is highly interactive with customers, clients and prospects. With a sales-force that is constantly away from their desk, there is a major lack of documentation and data to measure how effective their interactions are. A large majority of this research will come from my knowledge of the field (having worked in it for 5 years) and industry reports describing the need for higher productivity in these types of roles. Digitization is a new cost of doing business and can lead to a major competitive advantage, as many staffing companies in the field are too occupied with their own productivity to make the investments into process automation. This paper aims to identify the need for digitization and robotic process automation in the staffing industry and suggests that investments into the technology that drives automation will lead to reduced overhead costs and higher profitability. Getting people out from behind their desks where mundane tasks are being performed and into the field where relationships can be built, and new business can be identified is the mindset that staffing companies should adopt when considering their strategic road maps.
According to Gartner, Digitization is defined as “taking an analog process and changing it to a digital form without any different-in-kind changes to the process itself.” In a simpler description and in the context of this paper, digitization takes hand writing and converts it into a digital, computerized form. At current-state, much of this conversion is done manually which is a challenge for many organizations as it is mundane and consumes time that could be used elsewhere in more value-adding activities. In the staffing industry, there are generally two types of employee; the sales person and the recruiter. Some companies mix these roles and others segment the two further but in general, these are the two functions. Whether the sales person or the recruiter, both require a great deal of interaction with people and documentation to ensure that those conversations are captured in a viable way. The challenge in digitizing the output of these people is that the information is either verbal or hand-written, and very seldom emailed unless there is an intent to summarize it for documentation purposes. With the help of Robotic Process Automation (RPA), employees can leverage artificial intelligence to reduce double-work and increase efficiency through the digitization of these interactive processes.
The Need for Digitization is Here
In an article published by Booz & Company entitled “The Next Wave of Digitization,” there are three main driving forces that are creating a demand for companies to move towards a completely digitized business operations model. The first of these three forces is “Consumer Pull.” There is a major push for our lives to be interconnected across platforms and highly integrated amongst different streams of information. (Friedrich, Booz & Co.) Consumers and clients alike want everything quickly and easily accessible. In the context of the recruiting industry, much of what is done is repetitive and often inefficient. Recruiters have resources at their disposal, such as content management systems where resumes get stored, but since there is a major disconnect between powerful search functionalities and variable resume formats and styles, it is often very difficult to seamlessly parse and update management systems. Digitization of customer and candidate information is available but often inefficient. Now, more than ever, there is a major demand for staffing companies to stay ahead of the curve and meet the customer demands for quick and accurate information sharing.
The second force that is driving digitization is “Technology Push.” (Friedrich, Booz & Co.) Staffing companies have a plethora of data that is often just sitting there unused. There reason is because recruiters and sales people do not have the bandwidth to convert handwritten notes and notes from memory out in an efficient way. Additionally, when they are typed out, there is no uniform formatting that can be used in an efficient way, especially in terms of data analysis. There is a high demand for cloud computing and data analytics that are helping out other companies in greatly impactful ways. In “The Next Wave of Digitization,” article there is mention of a concept called “Internet of People.” According to BitcoinWiki, the Internet of People is “an open social graph, consisting of interconnected peer-to-peer networks hosting people’s profiles, reputation and identity information.” It is important to keep in mind that in the recruiting field there many things that are considered when people are placed in jobs. Much like the Internet of People, this includes a person’s resume (profile), their references (reputation), and their salary or logistical expectations (identity information). Building a crowd-sourced profile of each candidate within an organization is an essential part of reducing redundant work and increasing efficiency for recruiters. This, however, cannot be done unless information gathering is digitized and uniform for analysis.
The third and last force that is driving digitization are the “Economic Benefits.” According to the Booz & Company article, there is an increasing amount of money being spent into digitization technologies. With speed and efficiency being a main driver of success in today’s business environment, freeing up resources to focus on more value-adding activities is essential and digitization can provide organizations a real competitive advantage. In the recruiting field, firms often race against competitors when a job posting gets released to find the most qualified candidate who is interested, validate their experience, interview them and submit their profiles to the customer in a very short window of time. This happens sometimes 24-48 hours upon hearing about it. If competitors are not using pre-populated profiles from their database, the time to submit a qualified candidate is dramatically increased. However, if a firm can leverage a digitized platform that encompasses a large body of knowledge, they can beat the competition to business. Speed is a very important factor and if it is data-driven, it can offer an extreme competitive and economic advantage.
Robotic Process Automation (RPA) can help Digitization in Staffing
In short, Robotic Process Automation (RPA) is a practice in which software-driven robots are programmed to automate tasks that would normally be done by humans. These tasks are often considered to be mundane and menial. Technically speaking “RPA systems develop the action list by watching the user perform that task in the application’s graphical user interface (GUI), and then perform the automation by repeating those tasks directly in the GUI.” (Wikipedia) In the recruiting field, RPA can be leveraged to complete operational tasks such as expense reports, timesheet verifications, onboarding paperwork, etc. When exploring this in the context of digitization, some RPA technologies have the ability to scan documents and extract data from them through computer vision and machine learning. For example, the handwritten notes I have mentioned before can be scanned and completely converted into digital a form. From there, they can be parsed and uploaded into a uniform format that can form a candidate’s profile. This takes away the process of candidate qualification determination that is done by recruiter’s professional analysis, and often done incorrectly if the recruiter is not seasoned enough. RPA can work in tandem with the concept of digitization to ensure hiring decision are being influenced by data, rather than subjective analysis.
In a 2019 Global RPA Survey compiled by Protiviti, research concludes that there are many benefits to investing in RPA. Of these benefits; the biggest are increased productivity, better quality output, stronger competitive market position, and higher customer satisfaction. (Protiviti) The key factors that help staffing companies thrive are high levels of productivity and better quality which leads to higher customer satisfaction. This is fairly true for most industries but in recruiting, productivity is important as sales people and recruiters need to produce as many calls and meetings as possible to increase the chances of discovering new business. Since the field is built off of professional networks and your reputation in the field, building out a network of customers and candidates is the fastest way for firms to make profits. On the backend administrative side of recruiting, robotic process automation can greatly reduce the need of a support staff. Staffing agencies often have large teams of billing and onboarding specialists. At current state, this makes sense as a large volume of customers and contractors can require a great deal of management but if much of their work can be automated, firms can reduce headcount and create higher profit margins that would otherwise be consumed by salaries and wages.
In a report put together by Tata Consultancy Services, entitled “Robots in the Back Office: The Future of Recruitment Enterprises,” some specific examples of administrative process automation are shared. With Assignment Management where contract additions, closures and renewals need to be managed precisely, RPA can help extract data from contracts easily and templatize them for monitoring purposes. Time capturing and payroll processing is an essential function in recruiting as their workforce needs to be paid. RPA has the ability to pull information from sources such as vendor management systems to automatically approve timesheets and even send out automated reminders if information is missing. Billing and cash application are complicated processes because of how many customers a recruiting agency may deal with. Each customer has different applications and systems that the back-office will need to adjust to. There are also different payment terms and cycles that need to be considered. Robotic process automation bots can be developed to be flexible enough to comb over different systems and extract data where necessary. They can also be configured to consider terms and cycle constraints so that invoices are paid on time, minimizing financial risk.
More Automation and Digitization Means More Opportunity to Add Value
Many staffing firms are following the trend towards more professional services as opposed to the traditional staff augmentation staffing model. This includes the introduction of a managed services arm of the business. A traditional staffing simply entails submitting candidates to a customer’s job posting and when selected for hire, you manage onboarding and payroll. There is no management involved. There is a recommended need for enhanced services in the field to offer your customer more value, leading to the securement of exclusive business. Enhanced Staffing Services is a concept in which customers are in need of project-based resources or help with organizational build-outs and then the direct management of those resources. As of now, the management responsibilities are passed on to managed services teams that act as Program, Project or Delivery managers to help deliver solutions that are tailored to customer needs. As staffing firms build out their digitization process and robotic process automation technologies, it frees up resources to be devoted to this value-adding management. Additionally, the more data-driven an organization can become, the less risk there is associated with taking on these initiatives. With automated processes and better management, service-level agreements have a higher likelihood of being attained and customer satisfaction scores will correlate positively. My recommendation for staffing firms is to make the investment in automated processes so that new practice sectors can be opened up that can provide more value adding services in order to achieve competitive advantage. Since the staffing industry is extremely people driven, the mindset that a firm needs to take on is to get people away from their computer where mundane tasks are being performed and out into the field where client and stakeholder relationships can be strengthened.
Pressured by the demand for operational efficiency and availability of technology, digitization is a new cost of doing business and robotic process automation can help firms achieve this. The staffing industry is highly competitive and if firms continue to operate in a traditional way, they will lose out to more agile competitors that can turnaround requests quicker with higher value. This is a long-term vision that must be well thought out with intentionality and investments in technology must be made. According to Protiviti’s 2019 Global RPA Survey, in two years the industries who are projected to have the most maturing and advanced RPA presence are Technology-Media-Telecommunications and Financial Services with 56% of businesses at this stage and 53% of businesses at this stage, respectively. Much like these two industries, the staffing industry values profitability as a main strategic factor, so it makes sense to follow this trend of operational efficiency. RPA is a long-process that begins with the digitization of output produced by employees, but I believe that the benefits and applications of success are well worth the monetary investments.
Mr. Michael Lesce is a Program Manager at Insight Global where he managed a portfolio responsible for over one million dollars in annual revenue. His background is in technical recruiting and currently oversees infrastructure based projects. Learn more about the author here: https://www.linkedin.com/in/michael-lesce-2b011878/
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