According to Peter Drucker, a business only has two core purposes: innovation and marketing.

If you look at Fortune magazine's list of the world's most admired companies, they tend to be companies that are incredibly innovative:

Apple Revolutionized personal computing, music, and telecommunications.
Google Changed how we search the Internet, how we advertise, how we share information, and soon, maybe even how long we live.
Berkshire Hathaway Warren Buffett redefined the insurance industry, and his innovative approach to investing has yielded superior returns for his shareholders for decades.
Amazon The 800-pound gorilla of online shopping has completely changed the distribution industry. Now they are working on robotic- and drone-based fulfillment.
Starbucks $4 for a cup of coffee? People would have called that crazy until Starbucks redefined the coffee experience.

Why is Innovation Essential?

A few years ago, Price Waterhouse Coopers did an international study of 1,200 CEOs. Their number one finding? Innovation is the most important factor for growth.

But the study also illustrated a few other fascinating things:

Innovation cannot be delegated.
If the CEO doesn't drive and reward the process, it will fail.

Middle managers are not natural champions of innovation.
They tend to reject new ideas in favor of efficiency. They are not rewarded for being innovative.

Innovation attracts and retains top talent.
Yet most people don't think their companies want them to be innovative.

Innovation is a disciplined process.
Innovative thinking must be engrained in the work process, and people need absolute freedom to contribute ideas. Then the company needs a way to test and implement these ideas.

A Very Personal Example (or two)

In 2011, I attended the 20th anniversary reunion from my Wharton MBA class. During one of the lectures, a professor asked a simple question: How many of you work in an industry that did not exist when you graduated?

More than 90% of the room raised their hands!

And even in my own firm, Haley Marketing, our business is radically different than what it was when we started in 1996. Back then, we were basically ghost writers for staffing sales reps, helping people to sell staffing by writing great letters and educational articles.

  • The Internet was just a few years old
  • Few companies had a website
  • There was no Google
  • There was no social media

Next year will be our 20th anniversary, and in that time we've had to completely reinvent ourselves multiple times. Sometimes the reinvention was out of opportunities (e.g., capitalizing on the explosive growth of social media), and other times it was out of necessity (e.g., surviving the industry downturns in 2001 and 2009).

Today, more than 40% of our revenue comes from an area of our firm that did not exist five years ago. And 100% of our revenue comes from services we did not offer when we started.

Want to see specific examples of how we innovate?

Check out this PDF that outlines the new things we've done in the past 12 months

But What About Your Business?

The staffing industry is really fascinating. On the one hand, there are companies doing some incredibly innovative things. Yet the vast majority of the services provided by staffing firms today are nearly identical to the services provided by firms 20 years ago.

If you Google "innovation and staffing," you don't get a lot of results (although you might see one of our clients as the #1 search result!). However, you will find an article questioning whether or not the staffing industry can stay relevant.

Certainly there have been many innovations in recruiting in the past 20 years--from the rise of job boards to the growth of job aggregators like Indeed and Simply Hired, to the dominance of LinkedIn as a recruiting tool / job site / candidate database. And here is a great article on Zenith Talent's website outlining a few new recruiting apps that are trying to reinvent the candidate selection process.

There have also been innovations in service delivery with the advent of VMS technology, the growth of MSP, RPO and HRO services, the globalization of talent sourcing, and most recently, the explosive growth of the online staffing industry.

But has Your Firm been Innovative Enough?

Look back five or ten years ago, and ask yourself a few questions:

  • Are the services you offer today the same as what you offered then?
  • Do you take more ownership for speed, quality or outcomes?
  • Are your service delivery models the same?
  • How have you improved your recruiting efficiency?
  • Have you changed your approach to pricing?
  • How have your margins changed?

Innovation in staffing can be tough--especially when you are dealing with a client (HR) that tends to be very conservative and resistant to change. But without innovation, you get commoditization and an inevitable reduction in your markups and profits.

So, How Could You be More Innovative?

Innovation comes in two forms--radical change and constant incremental improvements. If you make a 1% improvement in your business every week, that's a 66% improvement in one year (with compounding). Constant incremental improvements can come from the simplest places:

  • Ask your staff how to improve sales, recruiting and service by 1% each week.
  • Ask your clients what you could do to better serve their needs.
  • Ask your candidates.
  • Ask your vendors for ways to make their services better for you.
  • Find partners who could help you drive, expand, or improve your services.

But maybe you want the BIG change. Here are a few strategies for revolutionary innovation:

Find new problems to solve for your clients.
The bigger the problem, the more value you can deliver.

Try to put yourself out of business.
Sit down with your team and brainstorm the question "what changes in hiring, staffing or technology could put our company out of business?" Based on the answer, you can then either defend against this risk, or try to put your current firm out of business with a better business model!

Move up the value chain.
Help your clients solve business problems, not just staffing problems. How could you take more ownership for outcomes? What services could you offer that would deliver greater value for your clients?

Dissect and reconstruct your service model.
Process map everything you do in sales, recruiting and service. Document every action and touch point. Define every desired outcome. Then sit down with your team and ask yourself three questions:

  • How could we do this better?
  • How could we do this faster?
  • How could we do this cheaper?

Embrace technology.
Maybe you'll get into the online staffing game. Or maybe you will find new recruiting tools to find talent faster. Or maybe you'll create an app that allows you to deliver a more exceptional candidate experience. Technology should be evaluated in regard to how it can improve the service experience, increase the capacity (and productivity) of the people in your office, and allow you to create new service models.

Challenge your team with an "impossible" goal.
Henry Ford once told his engineers to make an engine out of a single block of steel. They told him it was impossible. It could not be done. Ford responded, "I know. Do it anyway." While many thought he was being obstinate and unrealistic, Ford knew better. He provided his team with an "impossible" challenge AND the resources to solve it. While it took two years, his engineers finally had their eureka moment and delivered the engine Ford required. And that led to the dominance of the Ford Motor Company in the early 20th century. In staffing, that impossible challenge might be about time-to-fill, candidate quality, markups or any of the other drivers of service excellence.

Most Importantly: Create a Culture of Innovation

Innovation is a process. It takes time. It requires risk. It takes investment. And you must be willing to fail. Being innovative takes guts and commitment. That's why it's the CEO's job to create--actually demand--a culture of innovation.

  • Make time every month for brainstorming or other creative problem solving.
  • Constantly challenge your staff to find ways to deliver faster, better and cheaper.
  • Regularly ask your clients about the problems they are having (and not just staffing problems).
  • Test new ideas. And learn from them when they do not work.
  • Celebrate your successes...and even the bold initiative you attempt that doesn't work out.

Personally, I find it helps to be a little paranoid. Someone else IS trying to take your business. Your job as a leader is to find ways to make your services so irresistible that no client or candidate would ever want to work with anyone else.

Good luck! And please let us know if you'd like to set up a time to discuss your business and brainstorm opportunities for innovation.

Contact Us Today

Reprinted with permission courtesy of
Haley Marketing Group
716-631-8981
https://www.haleymarketing.com