Headhunters’ killer quality

Rebecca Wallace has a compelling reason to explain her recruitment firm’s debut on the 2011 BRW Fast Starters with a ranking of 24. “I’m really quite good at recruitment,” she says, “including when it comes to recruiting my own staff.”

The founder and managing director of Sydney-based Launch Recruitment – one of 13 recruitment firms to rank among Australia’s fastest-growing businesses – says the expertise, commitment and loyalty of her 18 staff ensured her business powered through the global financial crisis.

“My team are fantastic at what they do,” she says. “Ours is very much a relationship business and they’ve got such well-established relationships with clients that even at the lowest point in the downturn the order flow was consistent and, in fact, we increased market share during the GFC.”

Launch’s 2009-10 revenue of $6.3 million was an increase of 72 per cent on the previous year.

The firm specialises in recruitment for the telecommunications, utilities, alternative energy and agriculture sectors – all of which proved resilient during the downturn. Wallace says the fact that Launch was not involved in financial services recruitment also helps explain how they emerged unscathed from the GFC.

“I’d like to say it was all good management but some of it was good luck,” she admits.

Wallace, a former state manager for recruitment giant Drake International, started her business in 2006 and has branches in Sydney, Melbourne and Brisbane. For her, the expression “people are our greatest asset” is no idle mantra. During the downturn there were no staff cuts at Launch.

“I made a conscious decision there would be no redundancies,” she says. “Frankly, I didn’t know how long I could hold to that but luckily Australia bounced back sooner than expected. I’ve always believed that the more I put into my staff the more they give to the business.”

The importance of relationships is a common thread that runs through this year’s batch of fast-growing recruitment firms. Simon Hogg , co-founder and joint managing director of Sydney-based Balance Recruitment , which makes the Fast Starters list for the second successive year, says a “transactional” approach satisfies neither clients, candidates nor recruiters.

“We take the time to speak to candidates,” he says. “It’s important to take a personal approach because changing jobs is a serious business, it’s up there with getting married or buying a new home.”

As a “relationship-based business”, Hogg says the better Balance understands the career aspirations and priorities of candidates, the better it is able to fulfil the expectations of its clients. “It really comes down to building strong relationships with the right people in an organisation and then delivering on what it is that you promised to deliver.”

Balance, which has specialist practices in information technology, accounting and finance, had 2009-10 revenue of $5.85 million, up 41 per cent on the previous year, placing it at No. 25 on this year’s Fast Starters list.

Hogg, a former manager with IT recruiter Candle, started Balance in 2007 with three other partners, including his uncle Geoff Morgan, recruitment industry doyen and co-founder of the now defunct recruitment giant Morgan & Banks, which listed on the Australian Stock Exchange, as it then was, in 1995 and became a $700 million-a-year company before it was acquired by a United States concern. It was Morgan, Hogg reveals, who urged his nephew to turn entrepreneur.

“He said to me, ‘You need to do your own thing’.” Morgan does not play an operational part at Balance but he does sit on an advisory board, which meets quarterly.

Hogg does not have plans to create another Morgan & Banks. With offices in Sydney and Canberra and plans to open a Melbourne branch, Balance’s big challenge is recruiting the consultants it needs to press home one of its biggest advantages: experience.

Balance’s 11 consultants have an average of 12 years’ experience each. The company wants to employ more consultants – particularly with projected growth of 170 per cent this year – but as the recruitment market surges, so do Balance’s competitors.

“People make the difference, whether it’s the people we place with our clients or the people we employ as consultants,” Hogg says. “At the moment we’re finding it very hard to find good recruiters. It’s one of the biggest issues we face.”

Another recruiter finding it difficult to attract consultants is Sydney firm SustainAbility Consulting , which debuts on the Fast Starters list, ranked 57. Its 2009-10 revenue of $2.6 million is 129 per cent up on the previous year. The accounting, finance and IT specialist believes being a “boutique” firm – it has 11 consultants – is a plus. Peter Zonnevylle , who co-founded SustainAbility with Martin O’Donnell in 2008, believes being small helped the firm survive the global financial crisis.

“While larger competitors were going through cutbacks and downsizing we were able to grow from a low-cost base,” he says.

“We were just two people in a small room without great expectations but with lots of energy and passion.”

Zonnevylle says the GFC taught the business partners some “great disciplines”, such as cost management. It also gave the fledgling business the unexpected opportunity to attract candidates who were open to alternative recruitment firms.

“It was a great time to build our candidate network, treating every jobseeker with respect and courtesy at a time when many were getting frustrated at not having their calls returned and being treated like commodities by the big recruitment firms.”

Zonnevylle says forging enduring relationships with clients and candidates will be critical to SustainAbility’s success.

“When we make connections, they’re for the long term,” he says. “Candidates of today become the clients of tomorrow and clients can become candidates.”

Remaining a small firm will enable SustainAbility to maintain its focus on relationships but even boutique firms need people to realise their ambitions.

Zonnevylle believes that, with the addition of offices in Melbourne and Brisbane, the business can double its turnover in the next 12-18 months but its biggest challenge is finding fresh talent. He now wonders if the GFC was an opportunity lost.

“Looking back, we could have been more aggressive at hiring staff in the downturn, when good recruiters were more willing to move. We did recruit a couple of strong recruiters in early 2009, and they’re still with us, but perhaps we didn’t take full advantage of the opportunity.”

Zonnevylle says the big recruiters are “competing aggressively for talent”. As a former NSW general manager with Candle, one of the biggest IT recruitment firms, he knows big-name firms usually get first pick of the best recruiters.

“There’s a perceived risk in joining a relatively new brand but we’ve turned the corner to a degree,” he says.

“Having 11 recruiters creates a bit of momentum. It’s certainly easier now than in 2008 but it’s still a challenge competing with the Michael Pages and Hudsons of this world.”

Having experienced recruitment consultants with good contacts and industry knowledge has been critical to SustainAbility’s success, Zonnevylle says, but the company recently hired its first newcomer to recruitment as a trainee and is considering employing “one or two others”.

Melbourne-based executive recruitment firm Staite Henningsen Klein , or SHK, is well down that path. Although founded just four years ago, SHK has 40 consultants and the kind of blue-chip reputation that eases some of the pain in a tight market for recruitment consultants. However, SHK managing director Andrew Staite says the firm is open to hiring consultants from outside the recruiter community.

“When you find people who are passionate about what they do, who love what they do, then the business can’t help but be successful and recently that has included non-industry people with a knowledge of their markets and a passion for engaging with people.”

On the Fast Starters list for the second successive year, SHK is ranked 19 with 2009-10 revenue of $8.9 million, a 51 per cent increase on the previous year. Staite – who is a former Australia and New Zealand managing director of global recruitment firm Hudson – says SHK’s strength is “lasting, long-term relationships” with candidates and clients, and acting as a broker between the two.

“We work with candidates to find the right opportunities and if necessary help them develop career plans and identify target organisations that would take their careers forward,” he says. “The pleasure you get from those relationships can be incredibly rewarding.”

The relationship necessarily also extends to clients, which includes knowing a client organisation well enough to suggest a candidate even when there isn’t a vacancy to be filled.

“That’s where the relationship comes into its own, when you know you can ring someone and they’ll take the call and will be happy to review the person you recommend,” he says.

For Staite, the importance of these relationships means it is no longer relevant for SHK to remain exclusively a recruitment firm. SHK has already established an outplacement practice and it will shortly introduce an executive engagement and career counselling service for organisations that want to hang on to their top performers.

“Intuitively, it just makes sense for us to offer this service,” he says. “It will complete the career spectrum.”

SHK plans to list on the Australian Securities Exchange in the next three to five years and its business plan includes overseas expansion. The company does some work in New Zealand, accounting for just 3 per cent of revenue but has no plans for an office across the Tasman. Its likely first overseas destination will be either Singapore or Hong Kong but first it has some further domestic growth to achieve: it projects growth of 50 per cent this year and plans to open offices in Perth and Brisbane in 2012.

“Once we have established what we see as an optimal Australian presence we plan to focus internationally,” Staite says.

He says the growing role of social media in recruitment – particularly LinkedIn, the jobseeker’s tool of choice – has not altered the role of recruitment consultants, or the importance of relationship building.

“LinkedIn has enabled us to search and make approaches to people in a much more targeted fashion than has existed before,” he says. “It’s a means of identifying potential candidates and staying in touch with the right people but at the end of the day it’s still the relationship that counts and the consultants’ knowledge of clients and markets – that’s always going to be the case.”

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