The differences in Hiring between the US and Europe in the Procurement Technology sector

I recently wrote about the general market differences in hiring between the US and Europe and also about what candidates are looking for.

But what are the specific variations applicable in the Digital Procurement and Supply Chain Technology sector that we experience?

Size of the market

Just simplistically, the US Procurement Technology market is bigger. There are more people.

Why?

Basically, many of the biggest organisations in the sector are US-based or have significant operations based there. Additionally, a number of the smaller entrepreneurial startups and ‘best of breeds’ began in the US so their headquarters and ‘key players’ are in the US. There is also a bias towards more senior people with global responsibilities who manage EMEA teams.

Labour (Labor) Market Dynamics

The overall Tech Sector generally has a larger demand for tech talent, particularly in major tech hubs like Silicon Valley, Seattle, and New York City. The Digital Procurement and Supply tech market is just part of this and as a result, there is often more competition for the top professionals in the US.

The pace of the hiring process is often much faster as the US labor market is far more flexible with less employment legislation and typically much shorter notice periods. This drives client and candidate behaviour.

If someone resigns then they are leaving soon. Often within 2 weeks. Organisations need to act fast to replace them. Equally, candidates need to secure a role quickly. They aren’t waiting for a possible offer; typically the first offer typically wins.

Interviews tend to be shorter and more to the point and reflect the emphasis on individual achievements. Follow-ups are typically quicker.

As an example, a US P2P Client interviewed a Director-level candidate over the Christmas period three times in 10 days and made an offer immediately after the final interview. This kind of pace is unusual in Europe, especially over a holiday period.

Entrepreneurial start-up culture

The US tends to have a more entrepreneurial culture and this is true in Procurement Technology and there is generally a higher tolerance for risk-taking and innovation. Start-up culture is particularly prominent, and there is a strong emphasis on individual initiative and the pursuit of ambitious growth-linked goals. Sales roles, in particular, can be highly KPI-driven with a ‘no prisoners’ attitude to hitting the numbers.

Yes, there are plenty of entrepreneurial start-ups in Europe but not to the same level.

Location / remote working

There is no ‘centre’ as such in Europe but in the US a number of the firms are located in California (many elsewhere) but work across the Nation.

As such remote working has been established for much longer and people were often comfortable with 3-4 days away per week (less so since the pandemic). In Europe, we are seeing some demand for a return to the office up to 2-3 days, in fact.

On both sides of the Atlantic travel to meet clients is becoming expected on a ‘needs’ basis

Open to approaches / willingness to move

Until 5 or 6 years ago the percentage of the workforce with an active LinkedIn profile was still higher in the US than Europe. Whilst the UK is at similar levels for professional roles in some parts of Europe levels are much lower or people use different work platforms (such as Xing in Germany). The number of ‘open’ profiles on Linkedin is higher in the US and due to this it is still typically easier to identify the right type of person in the US.

Typically, in the US, people are more open to an approach even if not actively looking. They will listen and with the more fluid labour market are often more likely to move and take a risk.

People in Tech and SaaS especially are more typically ‘early adopters’ so open to different things and this is reflected in Procurement Technology.

Pay & benefits

The salaries in the US are typically significantly higher than their European counterparts and may reflect the % of start-ups as stock options and equity are more common in the U.S. European companies may offer equity, but it’s less common.

Language

Yes, English is often the main business language but in Europe, a significant % of people in the sector are bilingual. We are frequently asked to look for people with professional business fluency in at least two languages and this is gradually becoming a more prevalent ‘ask’. 

In one of our US clients, however, Spanish is increasingly important reflecting their customer and sector demographics and may reflect a future trend?

IF YOU NEED MORE INFORMATION ABOUT ANY OF THE POINTS RAISED IN THIS ARTICLE PLEASE DO GET IN TOUCH, I’D BE HAPPY TO ADVISE YOU

Peter Brophy
VP Digital Procurement & Supply Chain

peter@edburydaley.com

US Vs Europe Hiring part two – The differences in what candidates look for

All candidates look for the same things don’t they? The differences in what candidates look for between the US and Europe….

I recently wrote about the hiring differences between the US and Europe that organisations experience but also there are subtle differences in what candidates look for too.

Candidates’ preferences do vary based on individual factors but there are some significant general differences to be aware of which may help you understand the nuances of each market when people are looking for new opportunities 

Continue reading “US Vs Europe Hiring part two – The differences in what candidates look for”

Interview with Andrew Daley – Latest trends in Digital Procurement & Supply Chain

Watch this short video interview with one of our founders Andrew Daley where Tony Restell asks him three key questions:

1. In your latest Insider report you talk about it being very difficult for many companies to hire the expertise they need. What are some of the main contributing factors?

2. What are some of the most important trends you’ve seen in the sectors you serve?

3. Are you seeing companies increasingly offering flexible working hours, 4 day weeks and work from home options to entice more professionals to consider joining them?

 

You can download our latest Insider report here: https://edburydaley.com/the-digital-procurement-and-supply-chain-insider/

Video – How do Procurement Leaders hire the best in Digital Transformation?

We’ve just helped a leading international supply chain services business hire the specialist leadership they need for one of the most ambitious digital procurement transformation projects in Europe.

This company has long been seen as an early adopter of procurement tech solutions but they are now about to embark on a program that will take them to a new level.

How did we find the great people they have hired in such a competitive market for these skills?

This short video from Andrew will give you an insight.

Video – Four things great hiring organisations do to attract talent

There’s a real skills shortage at present, so how do you give yourself the best chance of hiring great talent?

In this short video, Andrew shares his experiences of what he has seen from companies that consistently win when it comes to competing for great people.

It covers go-to-market strategy, a range of sourcing approaches, and other key factors that can make a big difference in a competitive market for talent.

Click this link for immediate access.

Video – Exploring the value of Talent Intelligence from Edbury Daley

How do you source the very best candidates in such a competitive market when there is a skills shortage?

Hiring in the digital procurement, supply chain technology and sustainability tech markets is really challenging at present.

This short video gives an insight into how we at Edbury Daley ensure we are working with the very best people who are looking for new career opportunities in the European market.

It explains how the various elements of our Talent Intelligence offering combine to give our clients a competitive advantage with their talent acquisition.

Video – How do you solve candidate sourcing problems when there’s a skills shortage?

Is the skills shortage in the digital procurement and supply chain technology markets impacting your growth ambitions?

Are you wondering why you can’t find the people you need for your organisation?

What are your competitors doing about it?

Watch this short video from Andrew to understand how we address these challenges for our customers.

Video – 4 keys to hiring in today’s market

If you are struggling to hire the talent you need, you are not alone. Vacancies are increasing sharply and the supply of candidates is diminishing.

This two-minute video below by Simon Edbury highlights four keys areas to focus on to improve your chances of getting the right people into your company.

The dynamics of professional recruitment markets – how are they changing?

In this article, Peter Brophy examines a number of critical factors affecting hiring in the current climate including:

  • Professional recruitment activity has been severely disrupted by C19.
  • Capacity in the recruitment sector is drastically reduced.
  • Top performers can perceive job moves as risky.
  • People think recruiting has become easier but making great hires can be harder than ever.
  • What are your options when hiring for a key role?
  • Recruitment models will take time to adapt.

One of Edbury Daley’s most popular and most read articles over the past couple of years was on the subject of the various different Recruitment Models that are used by large organisations. It discussed how recruitment actually worked in reality, and was written to help our clients and candidates get some insight into the sector, so they could improve their own hiring or job search strategies.

Similar to many other professions, these recruitment models were evolving as recruiters embraced new trends in social media and increasingly adopted the use of AI and Digital solutions. However the recruitment market has been severely disrupted by C19 in ways that were never anticipated. At the height of the pandemic the recruitment industry reported drops of up to 80% in permanent recruitment and 50% in temporary markets. 

All bets were off and Internal Recruitment and Talent teams were suddenly faced with headcount freezes and hiring blocks on all but critical roles.

This has several affected capacity in both internal recruitment teams and external suppliers.

The market has bounced back to a degree since then but is still some way short of pre-pandemic levels.  In many sectors it’s recovering slowly as this report from KPMG and the REC shows. 

We don’t actually know yet what the ‘new normal’ will be but we do know that many of the potential changes and pre-existing trends to adopting new technology or ways of working have been amplified, so some of these changes have accelerated.

In tandem with the crash in recruitment volumes many organisations and external recruiters had to furlough a significant proportion of their people.  Many face the real prospect of redundancy before the year is over. As the UK furlough scheme comes to an end, anecdotal evidence indicates that many will take advantage of the Chancellors new Job Support Scheme meaning many recruiters will be working reduced hours or not at all. This has big implications for recruitment and the way it works.

Another major impact is that with increasing redundancies there are unfortunately more people looking for jobs, just at a time when there are fewer recruiters to deal with the impact of this e.g. huge advert responses often made up of largely unsuitable candidates.

So It should get easier to find good, available people right?

As we all know many organisations furloughed staff and as we reach the end of the scheme we are seeing a wave of redundancies particularly in the hospitality and entertainment sectors.

That should mean if you are hiring you will get plenty of good candidates right?

Well, actually not necessarily, no!

There are some big issues to challenge this assumption.

Recruitment actually gets a lot harder in a recession, not easier as recruitment models and behaviours change, particularly if you really need to find the best candidates, not just anyone to fill a seat, and that is the case in professional recruitment where head count is limited and leaders need the right person to fit the team, achieve targets engage customers, suppliers or stakeholders.

If your business is up against it in terms of pressure to deliver, then it may seem counterintuitive but recruiting directly for the ‘first’ people who apply could be the most expensive mistake you make.

The big challenges to overcome when recruiting right now

This ultimately is related to quality versus quantity and the impact on internal recruiters / HR.

Yes the volume of available candidates has increased and many people have lost jobs through no fault of their own, particularly in the badly affected sectors.

However most organisations are looking closely at their headcount costs as they try to remain profitable against often unpredictable demand. We know that many are using this as an opportunity to lose the poorer performers, often the ‘bottom’ 5 or 10% of their workforce or those in ‘non-core’ departments.

It is rarely admitted but few organisations will allow their better performers to go or lose their best people unless absolutely necessary for business survival. Think of your own business and how much you need your best people right now.

Equally important is the psychology of those remaining who feel relatively ‘safe’. Would you risk a move right now if your job appears ‘safe and you are performing well? There is also the old ‘last in first out’ adage and many feel moving to a new employer is a risk unless it is in a strongly performing business or sector. 

The reality is that most top performers in any profession or sector are sitting tight and making sure they are safe right now and do not want to take the risk of joining a new ‘unknown’ company unless they face redundancy themselves

Therefore the reality right now is that typically the volume of applicants to any given job is often higher, but critically the quality or relevance of those candidates may actually go down.

Another critical factor to consider is that due to the economy many people are desperate for a job so they will apply for anything, so are they really after your job or just any?  Will they take the first job they are offered and then resign as soon as a good job in their sector or preferred environment comes back? That risk is actually very high so when you think of the total cost per hire, the time wasted in the process, the problem of finding replacements etc it makes sense to tread cautiously.

So think carefully – yes you’ll get lots of applicants and potentially fill a role quickly but are the vast majority of the newly available and relatively inexpensive candidates really the people you want to hire?

Don’t you owe it to yourself and your business to think a bit more strategically and carefully about how you recruit right now?

The impact on internal recruitment / HR

Often internal recruitment teams are one of the first hit by cost-cutting and are typically very vulnerable in a recession. In the financial crisis of 2008 many were severely cut and it took a year or two before they bounced back. We have seen many being badly affected already in this Covid crisis. In fact, RPO and Outsourced Recruitment arrangements seem particularly badly affected as they are often linked to a flexible demand based resourcing model.

HR often have to deal with recruitment as well, but the function has been swamped by a number of conflicting priorities at the same time such as working from home, health and safety, mental health, furloughing staff and redundancies along with restructuring etc.  These issues are ongoing for them and unlikely to disappear any time soon, so this impacts on their capacity across the board.

So are you surprised that resourcing or recruitment may not top of mind for your HR colleagues right now? Or that it is one of many priorities they are struggling to juggle?

What are my options if I’m hiring for a key role?

So if your Recruitment and HR functions are constrained by limited capacity and you have a business critical hire what are your options?

Sorting through your own advert response will be time consuming, particularly in the current market with job seekers adopting a “nothing ventured nothing gained” mentality which is only exacerbated by the ability to apply to an advert in a handful of clicks.

Spending money on recruitment fees is a sensitive subject for many organisations who are scrutinising costs more than ever, but it can be money well spent if a credible, specialist recruiter is able to bring strong candidates into the process swiftly.  Particularly if their knowledge and network enables them to identify risk averse candidates who wouldn’t apply to job adverts, but could be interested in quality opportunities if engaged in the correct way.

Also bear in mind that with the recruitment sector facing its own commercial challenges, there has never been a better time to negotiate reductions in fees and maximise your value from the process.

The value of a good, specialist recruiter is emphasised when the job market displays extreme criteria, whether that be acute skills shortages, too many candidates or overcoming issues like job security fears, yet many people don’t realise that side of what they offer.

What does this mean if you are looking for a role?

Organisation’s HR people or in house recruiters are typically either feeling overworked or dealing with many priorities and are swamped. In some organisations the recruitment team will be much reduced or gone altogether.

Specialist in house team recruiters often suffer the worst headcount reductions as the business focuses on its core roles, so specialist knowledge in the team is often lost (such as procurement, sales and other commercially focused roles) and the generalist recruiters are retained to focus on core operational roles.

Many recruitment agencies (particularly broad generalist ones) face similar challenges as they focus on core areas and with reduced fees often focus only on those (clients and candidates) likely to make them a fee.

What does that mean for the candidate experience? Well typically the impact is a negative one with much slower response times, often a lack of feedback, or just poor communication generally leading to a feeling of wasted time and effort.

In some sectors there has been a deluge of applicants and when compounded by there  being fewer recruiters it has inevitably meant that candidate experience has significantly  declined. 

We know that many people are not hearing back from adverts or applications and are rarely getting feedback. Many candidates tell us they fear their CV has gone into a big black hole and of being lost amongst many applicants, particularly when they have applied online or via social media sites or even company websites.

The companies are subject to increased volume of applicants often sometimes, irrelevant or of low quality or from those just desperate for any job at any salary…..

Internal managers may need to recruit a replacement but may struggle to get budget or headcount sign off or find that HR are too busy with other things or the internal recruitment team or RPO is focusing on core roles or simply can’t give each role the specific attention it needs.

What this means for candidates is that it can be a bit of a lottery unless you have a direct contact in the business or you have someone specifically interested in what happens to your CV and is talking to people at the right level so your application does get considered. 

Consider your chances of being noticed – is it best applying via a portal or job site or sending a speculative CV?   Or is it better being represented by a specialist agency where the outcome really matters to them?  They  are often more likely to be talking to someone in a senior position who needs to hire.

Of course this article has covered a wide range of issues affecting the market today.  If any of these resonate with you we maybe able to help so if you are hiring in our specialist areas of procurement technology, spend management, finance and payments tech’, analytics, procurement or supply chain then please do get in touch.

We are also happy to help if you need general guidance on how to recruit outside our specialist areas.  You can contact me via peter@edburydaley.com

Want more information?  Why not read our follow up article – What are the challenges of recruiting in the current environment and how are companies overcoming them?

Peter Brophy

Associate Director

Peter Brophy is a CIPD qualified HR professional with significant experience of leading in-house Talent Attraction teams particularly in the Consulting sector before he joined Edbury Daley.

Image credits – https://www.proxyclick.com