One of our Directors Peter Brophy has previously worked as Head of Recruitment / Resourcing in organisations such as Rolls-Royce, BDO and Proxima as well as for Manpower the global recruitment and workforce solutions business. He has also worked within specialist Executive Search and Selection recruitment businesses. He has experienced and implemented different recruitment models and processes across a number of sectors at a senior level giving a deep insight into the strengths and weaknesses of these from both sides of the fence.
Here he offers his expert opinion on the merits of the various recruitment models available to large organisations.
Here’s an excerpt from our Procurement Quarterly Market Update for the second quarter of 2015 which addresses recruitment market trends and the availability of skills in the consulting sector.
The picture in the consultancy space is not as bullish as in quarter one. It is somewhat mixed as some niche areas (spend management) are doing well but many others are either static or struggling to win new deals and hence we have seen a number of examples of organisations pulling back on previous expansion plans.
Most consultancies are still recruiting but not at the rate anticipated or merely to cover leavers or to backfill promotions. The picture varies according to each organisation’s project pipeline and this can change week by week currently. This is impacting on recruitment as candidates become nervous when recruitment drives are delayed or even cancelled.
Much of the new project work being awarded centres around technology led procurement transformation and many of these organisations are successfully ‘on-selling’ other services. In our view organisations not offering access to a technology solution seem to be at a disadvantage in the current market
The larger outsourcing deals appear to be less in number as many CPO’s or senior Procurement Leaders have indicated to us that they are focusing on ‘targeted help or consultancy on specific areas of spend or to speed up specific projects’ This implies they want to retain full control and don’t want to commit to the costs or risks of a long term outsource unless there is a long standing relationship or a specific business problem beyond the in-house capabilities.
Some organisations are in effect running transformation projects internally by carefully utilising interims directly instead of ‘outsourcing’. However there remains a shortage of experienced consultants with the requisite skill set to deliver major transformation projects in procurement and supply chain at senior levels.
An increasing trend that we have reported before is the shortage of junior level consultancy candidates with 2-3 years experience. Many consultancies are increasingly delivering projects via a tiered delivery model with good junior people increasingly being used to support senior people on-site from day one. Therefore they can only consider those with existing client facing skills and experience as they cannot risk putting those without this straight into this environment. This increasing demand means salary rates for these levels are becoming increasingly inflated as competition for good candidates becomes more intense.
As an example we are finding that good junior people with 2-4 years experience can command a base salary of £45-50k for a move to another consultancy. There are examples of individuals with only 3 years experience being offered £55k to move to some of the smaller niche consultancies. This we think will cause increasing problems for the bigger players or those organisations with strictly controlled salary and career bands who are unable to flex.
If you wish to discuss any of the points raised in this article, please contact Peter Brophy.
Edbury Daley have instigated some timely new research on the choice of recruitment and selection methods and the impact of those choices on the success rate of a getting a quality recruit in to the hiring business.
As the global economy recovers many companies are pursuing significant growth plans. Often, the key constraining factor is the ability to hire and retain the skills and expertise needed. Employer Branding and Talent Communities are becoming the new parlance of Human Resource Management as bigger corporations embrace the advent of social media to gain an advantage in finding the people they need. This is covered in some detail in a very interesting recent study by Deloitte.
In our most recent Quarterly Market Update on the employment market for procurement professionals we reported on a skills shortage in spend management which has been created by the recent growth in the sector.
We mentioned the various factors creating inflationary pressures on salaries and offered some potential solutions for companies seeking to hire the talent they need in a very competitive market. The full report is available here whilst subsequent editions of our quarterly reports can be accessed here.
Unfortunately one fact is unavoidable, salaries are rising at pace and this is making it harder to afford quality people within existing salary bands.
Most salary data provided to HR departments is 6-12 months out of date and is too general to be accurate for a specific niche like procurement technology.
Given our specialism in this area we have access to a great deal of market data and have recently analysed how remuneration packages are growing at the various different levels from Directors down to graduates with two years experience.
If your business needs to benchmark its salary and benefits packages with direct competitors from the industry, we can provide a bespoke report tailored to your specific grades within a week. Please contact Andrew Daley if you require more details.
If you want more information about what’s happening in the Spend Management sector, including the latest news and career opportunities, you can visit http://www.spendmanagement.co.uk/
As part of Spend Matters focus on Talent this month we are contributing a series of articles relating to the subject of recruitment and retention of outstanding procurement professionals.
A great recruitment strategy actually starts with the retention of your best people. Why? Retaining, developing and promoting your best people sends a very positive message to the market that your department is a great place to work. Conversely an organisation with high staff turnover and unhappy staff will quickly gain a negative reputation.
So how do you keep your best people happy, motivated and away from what is a very busy job market?
Here we look at the reasons why procurement professionals to want to leave their current employer, what we in the recruitment profession call “push” factors.
Looking at this study from the US they list the top three reasons in order as:
- Career Advancement
- Work/life balance
We wouldn’t necessarily disagree with this but from our experience with procurement people there are a number of factors in play. Using years of anecdotal experience, here’s a list of the most common reasons people tell us they want to move.
Lack of career progression – when people reach the glass ceiling where they realise their future opportunities for advancement are limited they are generally willing to consider roles with organisations where those opportunities are considerably better. This is a common mindset amongst “passive” job seekers.
Lack of training and development – “I’m not learning anything” or “I don’t feel challenged” are common complaints that usually tie in with a lack of career progression.
Break down in relationship with boss/peers/stakeholders – this can lead to a pretty unhappy time at work and usually results in a desire to move jobs as quickly as possible.
Lack of senior management support – procurement needs sponsorship at the highest level to effect positive change. A lack of support from the top is a common reason why departmental leaders want to move. Similarly for those working with difficult or uncooperative stakeholders in Category Management roles, going to work can be very unrewarding and encourages people to seek an environment where their skills will be valued by others.
No challenge left in the role – many leading procurement people thrive on delivering the inherent change required to deliver better commercial outcomes. When they have delivered significant improvements and are left with running a “steady state” they become bored and seek the next challenge, usually in a new employer.
Treated unfairly – when people perceive that others are being treated better by senior management, whether it be through promotions, pay rises or bigger bonuses, this breeds resentment and pushes that person onto the job market.
Colleagues moving on – when people see their friends at work moving to other organisations for better roles and salaries they begin to wonder if they should be considering options outside their current employer.
Company health/profitability – be definition procurement people are commercially savvy and have access to all sorts of financial data. They know when the company is struggling and this brings the issue of job security onto the agenda.
Work/life balance – working long hours, making early or late calls to colleagues, stakeholders and suppliers in different time zones and excessive work loads will be tolerated by many in the short term but when it becomes a long term trend and impacts on your personal life it becomes a source of discontent.
Practical reasons – a significant change in personal circumstances often prompts people to look for a new job that is more suited to their lifestyle. People also move because of excessive business travel and difficult commutes.
Financial – it is actually very rare that a procurement person lists salary as the principal reason why they want to consider a move. In fact it’s usually us that raises the issue of salary and benefits when we first speak to a new candidate and most people will tell us that its only one consideration in a much broader picture.
However when it comes to actually discussing a job offer, it becomes clear that the salary is usually a critical factor.
This situation is perhaps best illustrated by something one of my senior management consulting clients once said to me:
“The thing that irritates me about hiring procurement people is how they switch from sales mode in interview to buyer mode at offer stage. They tell us that career progression is their top priority then feel the need to demonstrate their negotiation skills and end up giving the impression it was about salary all along.”
Whilst this maybe a slightly harsh judgement, it does offer an interesting insight into how many procurement professionals behave during the process, and confirms that salary is a key driver in almost every job move.
In our recent research into recruitment best practice we asked how much of an increase in basic salary would you require to commit to a move?
Only 10% of participants would move for an improvement of 5% on their salary, whilst 44% wanted at least a10% uplift. 39% said they would only move for an improvement of 20%.
With the skills shortage we mentioned above and this approach to negotiating job offers, its clear to us that companies looking to attract the best procurement people will have to look carefully at their budgets in 2015. Quite simply, if the financial package on offer isn’t attractive, most procurement people will wait until someones makes them an offer that does meet their expectations.
Our message to procurement leaders is this – we are on the cusp of a skills shortage in key areas of the procurement profession. Hiring good people is becoming increasingly difficult in a competitive job market and your best people will be in the sights of head hunters. A key target for you in 2015 is to work hard to keep those best people.
Whilst a small degree of staff churn is viewed as healthy by most, keeping your best people will also make it easier to attract a quality replacement when you do lose somebody.
For an alternative view from the US on this subject, this article from Forbes magazine makes interesting reading.
Our report on the job market conditions for procurement professionals and associated markets in the second quarter of 2014 features some interesting and largely positive developments. Whether you read this with the mindset of a hiring manager or with an eye on your own career, this analysis provides very informative reading. Headlines include:
- We are seeing some classic symptoms of a recovering job market for the procurement profession.
- Technology remains the most sought after area of indirect spend category expertise.
- The Spend Management Technology market continues to grow rapidly.
- Consultancies face challenges around balancing resources.
The full report is available here: Q2 2014 Procurement Market Update Featuring The Indirect Spend Index