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In this episode of our Industry Spotlight series, we are joined by Aaron Grossman, the CEO of Talent Launch, a leading player in the staffing industry. With over two decades of experience and a track record of remarkable success, Aaron is here to share his insights on growing a staffing business in today’s challenging economy.
In this episode, Aaron highlights the importance of having a strong tech stack and embracing automation to drive efficiency. Aaron shares his personal experiences and advice for aspiring entrepreneurs, emphasizing the need for discipline and perseverance, especially in the crucial first year.
Throughout this conversation, Aaron discusses the evolving role of technology in the staffing industry, from fears of it overtaking the human touch to its complementary nature, helping companies grow and adapt.
But it’s not all about technology. Aaron believes in creating a strong culture and fostering personal and professional growth within his organization. He introduces us to the concept of a “redwood tree culture,” where core values act as roots and environmental pillars guide the way.
We also delve into the challenges faced by smaller staffing companies and how Talent Launch is helping them overcome barriers and achieve growth. From integrated technology solutions to simplifying roles and responsibilities, Aaron shares strategies that can make a significant impact.
And of course, we can’t forget about the key metrics that drive success in the staffing industry. Aaron reveals the KPIs he monitors daily and offers insights on navigating through downturns and ensuring revenue growth.
Aaron Grossman [00:00:00]:
People don’t like change. And guess what? When you’re getting job orders left and right and it’s easy and I’m filling and I’m making a ton of money, and then suddenly you tell me I start seeing it’s not happening anymore, and then you’re telling me to solve this, I actually have to work two or three times harder than I was before to get the job order? That’s hard. It’s hard to get people to pivot that way and to understand that, especially in this industry and there’s a lot of other industries, nothing is status quo.
Kortney Harmon [00:00:28]:
Hi, I’m Kortney Harmon, staffing and recruiting industry principal at Crelate. This is the Full Desk Experiences Industry Spotlight series, where we are talking with the top leaders and influencers who are shaping the talent industry. In this series, we’ll be shining a light on popular trends, the latest news, and the stories that laid the groundwork for their success. Welcome back to another episode of The Full Desk Experience industry spotlight. Today, I have the pleasure of hosting a true industry leader, and his name is Aaron Grossman. He is here to share his invaluable insights on growing your staffing business in today’s economy and beyond. Aaron is the CEO of Talent Launch and seasoned professional with a wealth of experience in the staffing industry. As we dive into his remarkable journey, you’ll discover secrets behind his success and gain practical strategies that can revolutionize your own staffing ventures. Now, when you look at Aaron and his experience, you’re going to find a career marked by remarkable achievements, a commitment to excellence, and with over two decades of experience, aaron has honed in on his skills as a leader, paving the way for numerous organizations to thrive even in challenging economic landscapes. With a passion for innovation and growth, aaron has been at the forefront of driving success for staffing businesses. His expertise lies not only in identifying emerging trends, but also capitalizing on opportunity, overcoming obstacles that can hinder growth. Aaron’s unique perspective and proven strategies have earned him a reputation as a trusted advisor within the staffing industry. So throughout this episode, we’re going to delve into a wide range of crucial topics that are vital for success in the staffing industry. Aaron will provide valuable insights on seizing growth opportunities, overcoming challenges, implementing successful initiatives, key metrics, adapting to changing markets, and advice for entrepreneurs. So get ready to be inspired as we tap into Erin’s expertise and brain. So, whether you’re a seasoned staffing professional or budding entrepreneur, this episode promises to equip you with the tools and strategies needed to propel your staffing businesses to new heights. So without further ado, let me welcome the visionary leader and esteemed industry expert, Aaron Grossman to The Full Desk Experience. Aaron, thanks for joining us, and we’re so excited to dive into this much needed conversation today.
Aaron Grossman [00:02:57]:
Well, thanks for having me. I’m a little overwhelmed right now based on the introduction. Like, I feel I’m going to be such a failure in this moment, but hopefully I can live up to the wonderful introduction you provided. Thank you.
Kortney Harmon [00:03:08]:
Well, I mean, with a little bit of back knowledge on you as a person and maybe knowing you for 20 plus years, it’s a little easier to write that introduction.
Aaron Grossman [00:03:16]:
Right. Well, thank you. I feel really good. Like, my day is made today.
Kortney Harmon [00:03:20]:
I’m happy to help in any way that I can. Now, not everybody knows you like I do. I’ve known you when you started your career and have been touch and go and throughout within your organizations. So tell our listeners a little bit more about you, what you do, who Talent Launch is, and maybe why this topic resonates with you.
Aaron Grossman [00:03:39]:
Well, again, my name is Aaron Grossman and I’m the founder of Talent Launch. I actually probably like most people, I think there’s only one person I ever met that actually said I graduated college and wanted to get into the staffing industry. So like pretty much everybody else, I fell into this industry. I didn’t know that it existed. My first job out of college was selling commercial insurance, working for an insurance brokerage firm in Cincinnati, Ohio. Anyways, got a call from a big national staffing firm one day and said, oh, what’s this? And went and visited and really fell in love with just the idea of being able to help people in matching talent with opportunity and helping people find gainful employment and helping companies grow through talent. I love that concept and I also love the chaos of that. This industry is anybody that’s doing this knows that every day is different and you don’t know what you’re going to come into when you start the day and you don’t know how the day is going to finish. And I personally just love it. So I fell in love with this and worked for a national firm for the first couple of years of my career and then decided to venture off and start my own firm, where I’ve gotten lucky multiple times because I didn’t have the money to start my own company, but actually was introduced to an investor out of Detroit, Michigan, who I met on a Saturday morning with no business plan. And the next thing you know, he gave me a quarter of a million dollars to start the business and then he left me alone. Like I’m 27 years old and I’m like, are you going to help me? Tell me what to do. Actually, one of our core values is make it happen. And that’s because every time I’d ask him, he’s like, go figure it out, make it happen. And I had to learn the hard way what that meant. But started my first staffing company was Alliance Staffing Solutions back in 2001. Fast forward today. That’s now Alliance Solutions Group, and it’s one of our operating companies within the Talent Launch network I created the idea of the talent Launch Network back in 2016, which is now a nationwide network of independently operated but wholly owned staffing and recruitment companies throughout the United States. We’re now, I think, one of the top 150 largest staffing firms in the US. And really, our business model is about helping small staffing companies grow. There is a clear bottleneck in the industry that 97% of all staffing companies do less than 25,000,099%, do less than 50. And so our goal with the Talent Launch Network is to provide a large company feel from a back office perspective and a technology perspective. So we bring the best technologies, the best professional management, the best structures to smaller staffing companies to help teach them how to grow their staffing companies year in and year out. That’s what we’ve been doing since 2016. And our goal is to be a billion dollar company in the next six years. On top of that, I realize now I’m a serial entrepreneur. I’ve created one technology company that many might be familiar with called Able, which was sold a couple of years ago. And I just recently launched a new technology company called Preos Health, which is really focused on the healthcare space. The idea behind it is that we literally digitally transform a healthcare staffing agency overnight. It’s a marketplace hiring automation platform that really is the evolution of healthcare staffing for the future. That’s a little bit about me. I have five kids, live in Cleveland, Ohio, and I’m also a wrestling coach. So wrestling has been a big part of my life. I’m sure there’s a lot of athletes out there. I wrestled for the majority of my life, and it’s just a big part of who I am. And so I actually sometimes jokingly say that I wear a singlet every day to work. I feel like I’m wrestling in a match sometimes. I really am. But yeah, that’s a little bit about me.
Kortney Harmon [00:07:09]:
I love it. In your whole description, what you’re trying to do as an organization is grow staffing firms. So this topic is not better fitted for anyone else besides you. So I love this, and I’m excited to talk about it because it’s at the forefront of all of their conferences. It’s at the forefront of all of my conversations, is how do I grow? How do I get better? Because to get over those stats, that’s a big chunk of our industry in general, 99%. And people just want to get better, because when you do individually, you get better, your company gets better, so on and so forth. So I’m excited to dive into this topic. So thank you for joining us.
Aaron Grossman [00:07:44]:
Kortney Harmon [00:07:45]:
Now, our industry, the staffing industry, has evolved over the years. And in your experience, how have you seen it evolve? I’m sure you’ve been a part of a recession with your decades of experience.
Aaron Grossman [00:07:56]:
Are you saying I’m old?
Kortney Harmon [00:07:57]:
No, because I’m not much younger than you. I’ve known you for that long. So with that being said, what are some of the key factors driving this evolution?
Aaron Grossman [00:08:06]:
Well, everybody understands that technology is such a big part of this space. When I first got into the industry in 2001, there were still a lot of staffing companies who were either using cards or I think we had like a Dos based program that we were using and we were part of a billion dollar company. So technology was not centered to how we did our work. It was still very much manually driven. And I think as the years have gone on, for one, there’s been a lot more compliance that’s been a big part of our world. There’s a lot of litigious litigation that can happen. So being mindful and dotting your I’s, crossing your t’s around everything that we do because everything that we do is around people. And so we have to be very conscious about what we’re doing and how we’re doing it and making sure that we’re doing it in the right way. So technology has actually helped us drive, help us simplify the complexity that I think has happened over the years. It used to be just about finding talent done, but now you can’t just find talent, you’ve got to do a whole bunch of other things around that to make sure it’s done correctly. And so that’s been a big part of it and then especially in the last few years and COVID, I think has been a big driver of this is with such a talent shortage, the idea of artificial intelligence, obviously machine learning was coming up through that and automation. And just when you think about what we do, there’s actually a lot of inputs to the workflow to create a really great experience in the staffing world. Again, we are working with people, our client is a person, our teams are people. And so there’s a lot of communication, there’s a lot of inputs that need to happen in order for us to identify the right talent and put them and match them up with the right opportunity at the right time. And so to create a great experience, you have to be able to do all of these inputs to drive that. And the reality, as I said earlier, we don’t know what to expect when we come into work every day. So while we have an intent of what we want to accomplish and we want to do all of these inputs to create the greatest experience, five other things happen to us that we weren’t expecting. And oftentimes we minimize some of those inputs that would create a great experience to drive the outcome, which then can minimize the actual experience around that outcome. And that’s where technology, really, especially in today’s world, is really taking center stage and helping recruiters and staffing agencies drive those better experiences by automating some of those inputs, those communications around those inputs, to ensure that it’s still being accomplished, so that we can have a really healthy experience aligned with the outcomes that we’re trying to drive. So I really think that’s where technology recessions are always those moments where usually you see new technologies come up again. COVID is the most recent example of, you know, we’re in a soft market today. It’s the industry. ASA and Sai are reporting a year over year decline. And so what are you seeing? You’re seeing Chat, GBT, you’re seeing artificial intelligence start to creep up in a very significant way. And in some ways, some people are alarmed by it. They don’t know what to expect. They don’t know what it’s going to do moving forward. I personally look at it in this stage to be something that really complements the work that we do. I think that technology is for transactions and people are for relationships. And so I think with artificial intelligence is how do we again find those moments that matter in those workflows where people matter most and allow technology to automate and create a healthy experience around those other inputs so that we can actually drive even better experiences in the years to come. And that’s what I see in the industry today.
Kortney Harmon [00:11:40]:
I love that. I want to get into all the things you just said separately, and they’re not all my questions. I love that technology has changed. I remember when I started with your firm in 2003, it was using I mean, we were still using paper applications. We were doing things differently. And your company got me started on my passion for process and my education background, kind of meshed them together. And look, here I am at a software company. Who would have known? So thank you for that.
Aaron Grossman [00:12:10]:
My pleasure. It’s cool to see what happened with you. Like, where you’ve gone. It’s awesome. You were playing baseball for Cleveland State right at the time.
Kortney Harmon [00:12:18]:
What sport? What sport was I playing?
Aaron Grossman [00:12:19]:
Kortney Harmon [00:12:20]:
Softball? Yes. And I played on pitch teams with you.
Aaron Grossman [00:12:24]:
I think you did. It scared me how fast you pitch. It literally does scare me. I have nightmares about it still.
Kortney Harmon [00:12:32]:
I love that. Thank you. I hope you don’t have nightmares about me. Obviously going into that next set of topics. We’re talking about recession, we talked about technology. We’ll come back to technology. In times like these, you’re hearing a lot of people, or at least I am, saying, I’m going to tighten my belts, I’m going to really batten down the hatches. Have you seen firms and agencies grow at times like this? Obviously when we’re seeing these technologies kick off, everybody’s gut reaction is to hold back. Does it make sense? Is it possible to grow in times like these? Or is it just the innate response of how people are responding to economic times?
Aaron Grossman [00:13:08]:
Well, I think the natural response, obviously, is to manage profitability and manage your financials during a time where you see a softening in the market. I have seen companies grow during this time. And I do recall actually, during 2020 and 21, there was a firm that I had some people that I knew. Not my firm, but a firm that’s talking to, and they actually really looked at what industries are actually scaling up during a downtime. And in that case, I think it was like last minute mile delivery. So when you think about COVID what happened, people are at their homes, they’re shopping Amazon or whatnot, things are not even delivered. So they saw an immediate need. They thought there was immediate need. And so they proactively engaged in moving into that vertical and they saw extreme growth during that time. So I think it’s really being smart about understanding, okay, where are we at in this moment? And what industries are either coming up or going to grow in a down market like this? And if you can be proactive enough and strategic enough, you can capture a lot of growth opportunities by pivoting into those spaces in 2020. For us, for example, we were not in what we call retail merchandising. We had no idea. And so it was stocking shelves, putting things into stores that end up being delivered, and we ended up getting an opportunity and secured a client. We had never done it before. And next thing you know, we had three or 400 people throughout the United States working in different department stores, grocery stores, stocking shelves in our industrial space. So that was something that really helped save us in a very difficult time in 2020. So it is all about being strategic and being nimble enough to pivot and pivot fast.
Kortney Harmon [00:14:53]:
I love that. I love the idea of being able to take something, whether it’s even an arm of your organization, to go contract a perm or the idea of going into a new industry, but just having that pulse. And it sounds like I know you especially personally, you’re very well in tune to the market. You’re always talking to people. And I think that’s just when you’re well connected and you’re having those conversations, you come across those opportunities. So I love that you were able to pivot. That’s obviously a positive. But what are some common challenges or roadblocks that maybe your staffing firm has had or others may have encountered maybe in that process of growth? Right? We often learn more in terms of our failures than we do in terms of our successes. So you want to share any challenges that you guys have had when you guys have been trying to grow? Because I know that’s your mission.
Aaron Grossman [00:15:42]:
To be honest with you, as I said earlier, our entire business model is about helping staffing companies, smaller staffing companies, grow past those barriers that I mentioned earlier. This has been a progression to understand where are those roadblocks and then how do we crelate solutions to overcome those roadblocks? So I’ll give you something that we’re working on right now. We’re actually literally doing this right now. So let’s talk about roles and responsibilities. And this is a theory that we’ve had in that what we find in a lot of smaller companies, especially ones that have kind of peaked or reached a plateau that they haven’t been able to overcome and haven’t figured out how to overcome, but they want to retain their staff. They might decide to create new titles, new roles that not necessarily are progression roles that help the company scale. It’s more about how do I keep this person here? By giving them a title, giving them different responsibility. And what that ends up doing from an accountability perspective is it makes it very difficult to understand who’s doing what, who’s responsible for what, and how do I hold people accountable to what. And so that’s kind of the newest roadblock that we’ve uncovered just this year. And now we’re kind of circling back. And what we’ve done is create we have two tracks. Basically. We have a recruiting track, so we have a career pathway progression around it, and we have a sales track. And so we’re just now starting to roll this out. But the idea is to simplify the roles and responsibilities and also give people a pathway to grow. Another thing that I’ve seen over the years is in companies that we’ve acquired is that I hire you into a role. You’re going to work as an account manager or a client manager. And in my mind, I’m thinking you’re going to be there for the rest of your career. Now, how likely is that? How many people want to take a job and sit in that same job for the next ten years? If they do, they’re probably not ones who are going to help you grow your business. Being an athlete, I know you’re an athlete. I want to know if I’m getting into a role. I want to know, okay, even though I’m accepting this role, I want to know how I get to the next one and how I get to the next. What do I need to do? Tell me what I need to do and what does that look like? Most of the companies that we that have come into our network initially don’t necessarily have those all mapped out in a very simple, strategic way. And so that’s another reason why if you want to get top talent that can help you grow your business, you got to show them a path of how they have the ability to have a journey with you and have a career with you. So these are the things that we’re working on right now to help remove that roadblock to grow. A lot of other things is I’ll mention a couple of other things is just, again, technology like these are small companies. They don’t necessarily have the resources, the bandwidth to kind of go out and understand what technologies that are out there that might make an impact in my business and that’s only step one. So let’s say you do find that technology. Now the hard part is figuring out how do I integrate that technology, how do I bring it into my tech stack so that a recruiter or whomever is in your company isn’t having to go into three different systems to do their work because they won’t do it. You got to figure out how to get them into one system, which takes strategy and it takes some expertise to know how to do that and it’s not easy. And so I’ve seen a lot of smaller agencies procure technology, spend a lot of money into it and they can’t figure out how to integrate it effectively. And then let’s say you do integrate it effectively. Now how do you create education to create the adoption so that you get the utilization to it? Because let’s be honest, we are as human beings, we are creatures of habit. And so change isn’t always easy for us. We always will say, oh, we don’t mind change, we can do it. But the reality is it’s really hard. And if you get accustomed to creating a habit around how I perform my work and suddenly you tell me here’s something else that’s going to make it better, well, it doesn’t mean I’m going to suddenly start using it because I’m into my routine. So you have to really create a really healthy change management initiative and strategy to create that change that you need and to create the inspiration around it so that you can get the adoption so that it becomes part of how your people do their work. These are just some of the things that we’ve seen that become roadblocks to staffing, companies growing.
Kortney Harmon [00:20:04]:
I love that. And we could do it. I already did a whole episode on change management, but that’s chronic change then leads to retention problems and I mean, it’s a snowball effect. So I love that you said all those things and I paid you nothing to say all them. So there are some negative, there are some challenges, things for us to think about, food for thought for our own industries. But let’s talk your guys own success. You talked about some things that you’re implementing now, I love that. I just had a conversation with Dan Mori about career progression management, understanding that me and you, we want more, that’s not necessarily everybody, but being able to have understanding what metrics I have to hit, understanding what’s next keeps that engagement within your organization and long term retention. So can you share some other maybe examples of successful growth initiatives that you guys have implemented and what made them successful?
Aaron Grossman [00:20:55]:
There’s so much that I could talk about. One thing that I would say that we did that was really meaningful was in 2021 and it was centered around job order management. Now growing up, working for, I worked at robert Half when I first cut my teeth into staffing. So it was very focused in the accounting and finance field. And it was very disciplined and regimented in how we did our work. And so job order, there was a way in which you manage a job order. And I was always used to filling a temporary job order within 24 to 48 hours at the latest. And what I was learning in our environment because a lot of these companies we have acquired is that the fulfillment, the times to fill were like crazy long. And really kind of the story here is that it was in 2021 when everybody started to worry about the scarcity of talent. We can’t find people. And I was looking at our data and I’m like, we’re interviewing 1400 people a week. We had over 3000 open jobs then. And I’m like, how are you interviewing 1400 people, yet the 3000 open jobs isn’t going down, it’s staying there. Oh, and by the way, we’re actually not growing. So first I listened to the field who were saying, we need more talent. We move our talent. So I invested heavily in recruiting so that we can get more talent in. So next thing you know, we’re interviewing 1700 people a week, but we still did 3000 jobs and we still weren’t growing. So then my kind of light bulb went on and I’m like, all right, this isn’t about the talent coming in. This is our inability to effectively understand which jobs do we actually have open that we can actually fill? So I created an entire strategy around how we an automation strategy of how to actually manage a job order. So suddenly all job orders that we would accept would become like, let’s say they’re eight orders. And depending on the submittals or the placements within that job order would determine whether that a job order would remain an a job order until it was filled. Or if there were no submittals and no placements, after 14 days, it would move to a B order. And if after 21 days it moved to a C order, and if it was still open after 45 days, closed if there’s no placements. And so what that ended up doing is reducing our job order count to 1500. And we grew 15% in 45 days. So suddenly we didn’t have to get more talent. In fact, we reduced the 17 back to 1400, minimize that. And we started filling our jobs and growing. That really was the essence of it. So that was a key area of success. We also spent time around talent interviewed. So going back to that 1400 people that we’re interviewing, we created a tracking mechanism to understand, okay, of those 1400 people we interviewed that week, how many get placed in week one, how many week two? So you can start to see very clearly that if we don’t place people in that first week, the chances of us placing that person drastically starts to decline. And then we can understand if we haven’t placed that person in eight weeks out of the 1400 people, what we learned is that 80% of the 1400 people we didn’t place after eight weeks. Wow, think about that. If you’re a manufacturing company, you’re going out of business, that’s tremendous scrap. So that’s just a huge, that business intelligence gives us the opportunity to start figuring out how do we close the gap, how do we minimize that number? And so business intelligence has been a huge piece of our ability to grow the business because we can see where those gaps are by looking at the functional aspects of the work that we do and really getting hyper focused into that so that we can know how do we create better efficiencies? And that’s some of the stuff I.
Kortney Harmon [00:24:33]:
Love what you’re talking about, because a lot of times what we see in our industry and you can probably agree or disagree with this, but there is oftentimes a do more mentality. We just want you to do more. Go get more job orders, go place more talent, go call more people. But you’re kind of calling bull crap on that because it’s not necessarily do more, but it’s better. It’s better quality, it’s better analytics, it’s better understanding. Because oftentimes, and I’m saying this coming from a software company, our ATS just kind of gets the plethora of data. It just gets dumped in and it gets forgotten about. So I love you talked about automations. Automations are what keeps us in track. It keeps us making sure we’re looking at the right information at the right time. So I love some of those initiatives that you talked about.
Aaron Grossman [00:25:15]:
Well, the automations have been huge for us. I mean, we started to really kind of automate whether it’s node action types, we call them node action types when we document the activities and kind of what those were and then the statuses around the contacts or the client records so that we can create a note action type which could change the status of a contact or a candidate. And then we could create reporting around it so that we can start creating recruiting funnels and sales funnels. That’s been one of our most recent things is really helping staffing companies understand how to create a sales funnel. What is a sales funnel and how to track it from a business intelligence perspective. That’s been a huge education for us, that’s been incredibly impactful over the last few years.
Kortney Harmon [00:25:56]:
You said education. That’s going to take me to my next question, of course. What role does continuous learning, professional development play in the growth of a successful staffing firm?
Aaron Grossman [00:26:07]:
Well, I think, you know, I have this redwood tree culture that I’ve built from the ground up. It’s something that I created. And one of the pillars, and when I say pillars are the cloud, we have this redwood. Tree concept. And we have clouds that sit over top of thing. And the roots of our redwood tree are core values. Those are the things we hire and we develop and we ultimately fire to as well. Those are the things you have to be to be a part of our network. But then the clouds that sit above the redwood tree are the environmental pillars. These are the things that if we, as a culture, if we’re feeding it, then we’re feeding our redwood tree. We’re feeding our core values so that we can grow a redwood tree anywhere in the United States. One of our pillars is active learning, which is to constantly be in the pursuit to grow both personally and professionally. So I absolutely believe in my heart of hearts that we need people who ultimately want to achieve their best self. They want to help them realize their potential. And the way that you do that is by learning. Right? So we want to make sure that we’re providing great training, great learning. There was a concept that I created years ago called Era, which is educate, reinforce, adopt. And the reason why I created that is because what I noticed back then is that everybody focuses on the education part. So we had an hour long workshop. Isn’t that good enough? No. We all know that we probably keep 20% to 30% of what we hear in that moment. The rest goes out the window. And if we’re not applying it instantly, all of it typically goes out the window. Right? So you’ve got to not only create an education, but you got to figure out how do we reinforce that education so that we can ultimately drive adoption to what we’re trying to learn? So I’m a big believer in it personally. As an entrepreneur and a CEO of a business, one of the greatest things that I did for myself was sign up for continuous learning through organizations like the Entrepreneurs Organization that I belong to for many years. And one of the greatest gifts for that was that they gave me a path of leadership within that organization. It’s a nonprofit, so it’s led by people like me. And I got a chance to run the Cleveland chapter. That 160 members. So I’m literally leading other entrepreneurs. Everybody’s an entrepreneur, everybody’s a volunteer. And I’m having to learn how to lead people and get things done with people who are built like me, which is really hard to do, by the way. And then I was able to one of the inspirations that gave me the confidence to want to create a billion dollar company is that I got an opportunity to be a regional director for EO. There was nine regional directors in the world, so I got a chance to meet people all over the world. But I literally was representing 2300 entrepreneurs in the central US. For two years, and again, just giving me a lot more experiences and insights and being able to kind of listen to my peers and learn, but at the same time lead. And that gave me the confidence to say if I can do that with entrepreneur like 2000 entrepreneurs, I can lead people to a billion dollar company. And so I absolutely believe in the concept of continuous learning, not only at the staff level, but at the leadership level as well.
Kortney Harmon [00:29:08]:
I think that it’s so important, obviously that’s my background, but I think it just continues to help us evolve and it’s sometimes the thing that’s put on the back burner. So not to forget those pieces, this kind of goes hand in hand of marrying those two topics together. But what are the key metrics and performance indicators that staffing firms should track to measure growth and success? So how do you know you got there? How do you know you’re doing it right? What are some things that you measure within your organization that are top of mind?
Aaron Grossman [00:29:33]:
Well, I think everybody measures revenue, right? Revenue, gross margin, those are like the outcomes, right? I think that what we have really honed in on is talent working because that’s market share. If you’re getting more people out to work, that means you’re getting market share. It’s also on the staffing side, it’s hours worked, our available hours working. Now that can vary based on average hours worked in a week. Like I might have more people out working and have less hours worked because their average hours worked maybe is a holiday week or whatnot, but still hours worked is a big performance indicator for us as a business. We’re looking at our active clients build. Obviously if we’re growing active clients build, we should be growing market share, right? New clients build. So it’s not just our active clients, but that helps us understand on our sales, on our business development, are we still hunting? Is the wheel still turning? If we’re not getting enough new clients coming in, eventually we’re going to see attrition in our active clients build. And that’s typically what I see happen in a recession with staffing companies who don’t have a strong sales focus is that you’ve got the way we look at revenue, we look at new revenue, we look at expansion revenue, we look at reduced revenue and lost revenue. Those are like the four quadrants. So in a recession, what are you going to see? You’re going to see your active clients probably reduce their revenue. You’re going to see your expansion revenue decline. You might not lose that client, you’re just going to see a lot less of it. So the only way you can combat that is with new client acquisition. So if you don’t have a really strong wheel around that, you’re going to see a dip in your business. And that happens to more firms than I would like to see, including aspects within our firm. So we’re still working to solve for that. Job orders, obviously getting job orders, that’s a healthy indicator. Like when we started seeing, even in this year, we started seeing a slight dip in new job orders created. So that’s a sign. So if you start seeing that consistently, that can allow you to be more proactive on expense management or just making sure you’re putting your costs in the right bucket within your business so that you can still keep the wheels spinning in a positive direction. Those are just some of the indicators that we look at on a daily basis. To be honest.
Kortney Harmon [00:31:50]:
I love that. So you guys look at that daily sometimes, especially when we saw COVID. I don’t necessarily know if you saw this within your organizations. I saw a lot of firms like, we have too much talent. We don’t necessarily we’re getting job orders, they’re already coming in. We’re not going to go search for new and now it’s like, oh, now that that’s slowed down and you’ve seen that trend, it’s like, well, we have to get these staffing firms reflexing, this muscle that they probably haven’t used nearly as much as they should have over the past two years.
Aaron Grossman [00:32:15]:
Exactly. By the way, starts and ends, like, I didn’t say this earlier, but those are the simple, those are the ones you look at. I mean, I’m looking at that throughout the day, right? And one of the things that I’ll say to starts and ends is what we’ve been able to do is because now we’ve got history of data we can see Monday, we know if our starts within a certain range, we know through data that that means we’re probably going to hit this number by Friday or by the end of the week. So we know on Monday whether we’re going to be good or bad. And that gives us starting blank. Okay, we got a red flag here. Our starts are low. We got to start running. So that’s actually a really good indicator for us to manage the business on a daily basis. But to your point about yeah, I think that’s the biggest thing in staffing right now is we were taking job orders. Like, it was like just coming out to the spigot. And so sales, the sales aspect of things kind of died down a little bit. The muscle wasn’t built as strong as it was before. So everybody’s trying to figure out how do we build that muscle back up? Because again, people don’t like change. And guess what? When you’re getting job orders left and right and it’s easy and I’m filling and I’m making a ton of money, and then suddenly you tell me I start seeing it’s not happening anymore, and then you’re telling me to solve this, I actually have to work two or three times harder than I was before to get the job order? That’s hard. It’s hard to get people to pivot that way and to understand that, especially in this industry. There’s a lot of other industries. Like nothing is status quo. Our economy goes up, goes down, goes up and goes down. And if you can understand that, you can understand that the way you work is always going to shift depending on where you are in that economic cycle.
Kortney Harmon [00:33:55]:
Great advice. So can you provide some actionable tips or advice for staffing firms that are looking to accelerate growth and maybe achieve long term success? Any advice, tips or tricks?
Aaron Grossman [00:34:06]:
Well, I talked about this earlier, I think. And again, I’m learning these things like the roles and responsibilities. Make it simple. One of the things that I made mistakes on and have made mistakes on is that I have a complicated brain and I have these visions and to me it’s like I can articulate what they are and I can document, this is how you do it. And it seems simple to me, but when you really get into it, it’s not simple to most. So I think really looking at what outcome you’re trying to drive and how do you make it super simple for somebody to execute against from a learning and development perspective? This is the other thing I’ve learned around. This is like when you create too much complexity in the business and you make it very hard, it’s very hard to train against that and to get the adoption you need. And let’s be honest here, this industry has turnover. I think the average career is maybe three years. I don’t know if it’s less than that. It’s around two to three years. So if you’re constantly rotating people in and out into a complex business model that has complex training, by the time somebody gets up to speed, they’re already halfway out the door. So again, if there’s one recommendation, simplify your processes. Make it super simple to crelate the outcomes and the experiences that you’re trying to drive. And then create great training around it so that you can get people up to productivity as fast as humanly possible and make sure you have the right roles and responsibilities. Because if you want to get I used to say this, I want to hire a bunch of sharks. People who are really competitive, who want to win, who want to grow. So create a journey for them in your business. Take the time to invest in yourself in creating that journey so that you can give people here’s what good looks like and this is what gives you the opportunity to get promoted to your next role. You do that, you’re going to get better talent wanting to participate with you to drive that growth for you. And I think those are just two quick advice tips that I would give.
Kortney Harmon [00:36:03]:
They’re big. They’re big and they’re not necessarily something that takes, that you can execute overnight. They require a lot of time and effort. I’ve had to try to train people on your brain so I understand the complexity of it.
Aaron Grossman [00:36:15]:
Yes. That’s why we’re trying to make it simple now.
Kortney Harmon [00:36:18]:
What are some emerging trends in the staffing industry that firms maybe should be aware of and adapt to? You talked a lot about technology. I’m not necessarily saying that you have to go to technology, but think about trends going forward, what you’re seeing, where you’re pivoting to within your organization.
Aaron Grossman [00:36:37]:
Reality is it’s focused around technology. Our mantra is people for relationships, technology for transactions. We want to figure out where in the workflows people matter most in our world, what we’re trying to become. Actually, my marketing executive kind of talked about this a couple of years ago. She’s like, we want to be the Best Buy of staffing. When you think about if anybody’s read the book Good to Great with Jim Collins, he doesn’t talk about Best Buy, he talks about the competitor, Circuit City. And Circuit City was one of the great companies back then, but they didn’t pivot as ecommerce really developed in the early two thousand s, and next thing you know, they’re gone. But Best Buy was still here. They figured out how to adapt to the technologies that were coming in in place. They figured out where their stores mattered most, where their people mattered most. And we’re sitting here in 2023, and Best Buy is still a relevant business today. Staffing. I will say, and again, I think throughout the two decades that I’ve been doing this, there have been different technologies or different software. Whether it was job boards in the early 2000s like Monster or Crew Builder, everybody was scared, like, oh my God, staffing industry is going to be dead, that they’re going to take over or LinkedIn when it started to come up, oh, they’re going to take over the staffing industry. None of that happened. In fact, all of them became complementary tools to the staffing industry to help us grow. That being said, I think there are a lot of executives in the staffing space who see that technology is coming to the forefront, where it’s now going to become disruptive, where it truly is. And artificial intelligence is really, I believe, going to be that disruptive force. There are already things that are out there, artificial intelligence that are out there where you can actually have a conversation on the phone and you do not know that it’s artificial intelligence that’s talking to you. That’s how good it is. And it’s still in the early stages of this. So if you’re an agency, you’re not mindful of artificial intelligence, whether it’s Chat, GBT, or some of the other solutions that are out there. You really need to start investing some time into understanding what’s going on in that space and try to figure out how to adopt some of those tools that are using artificial intelligence into your workflows so you can be a part of the future rather than die because of the future. It’s coming and it’s coming right now.
Kortney Harmon [00:38:52]:
We actually just had two podcasts that dropped. One was chat GPT workshop. It’s really about prompting, doing things the right way. And AI is not here to necessarily replace us. But soon, I’m not quite sure if you’re going to find a job that doesn’t use AI to make you faster, to make you better, almost to give you like that Superman hero cape, right? To make you do things at scale. But it’s about the human element. We’re never going to forget that, especially our industry. We’re people. People. So with that being said, I know you had talked about a recent conversation you had about AI.
Aaron Grossman [00:39:26]:
Yeah, literally this morning. So it’s around training and development. So you think about role plays. I know you love role plays. It’s a huge part of somebody’s development. And it’s not always something that people like doing, especially in a group setting, right. They’re uncomfortable or whatever. And honestly, to do a proper role play, traditionally, you need two people to do it at a minimum, right? Well, guess what? Chat GBT and artificial intelligence, it’s built up to a place now where you literally can use it to role play, where you can actually be in your office or be at your desk. You can actually have a real conversation, very functional conversation with artificial intelligence and role play your scenarios and get training whenever you want and not feel uncomfortable that there’s human beings participating with you around it, but you’re getting the real feedback of what a person would say back to you. That’s incredible. When you think about it, how cool is that? So to your point earlier, it’s like artificial intelligence is going to help us become better.
Kortney Harmon [00:40:29]:
I love that. I think it’s great and I think it’s just at the forefront. And I know it’s scary, but again, it’s one of the things that’s going to change our trajectory of our industry. And I think just being able to understand it, understanding the nuances and the challenges that it might bring, and just keeping them aware in the forefront of our brain. So how can staffing firms leverage data and analytics to make informed business decisions and drive growth? I know you talked about KPIs a little bit, but maybe dive into that a little bit more. How can we leverage data and analytics to drive growth?
Aaron Grossman [00:41:01]:
I can give a story of back around the job order automation of like what I talked to you earlier about what we did. Right? But how we got there, how I actually got there was through data analytics. So once I started realizing, okay, we went from 1400 to one, 7000 hundred people, we still have 3000 job orders, we’re not growing. Okay? I’m seeing that in the numbers right now. I want to use business intelligence to help me understand really what’s going on. And so what I learned, I created a fulfillment analysis report. I created like a job orders with starts report, like, how many job orders create the starts. And we had a B and C orders. And what I learned was that the job orders that created starts, the majority of them, I think it was like 70% were rated C orders. Our A orders were like the low percentage. So I’m like, okay, this is telling me that we are in a sea of job orders and we’re lost because by the time we’re fulfilling them, they’re C orders. They designate C orders because of a time issue or whatnot. So I’m like, all right, now I can see what’s going on here. So then you fast forward. When we created the automation, went back to those same reports that I created right now. Fast forward. We launched it in August of 2021. It’s almost August of 2023 now. 92% of all of our job orders that create starts are filled within our A orders only. I think it was like under 5% are C orders and the rest are B. So the majority, we’re filling orders faster. We’re filling them in a more focused way. And so that business intelligence showed us that, okay, we saw the problem through data. We created a solution. We use that same data set to see that the problem is now solved. That is a real life example of how we use data to actually see the problem and validate the problem and then use it to actually ensure that we’ve solved for it. That’s just a quick example.
Kortney Harmon [00:43:09]:
Quick but timely example. I love that. And I think it’s important just to be aware. And now you can monitor that. That’s never something that’s going to be off your radar ever again, right?
Aaron Grossman [00:43:18]:
Kortney Harmon [00:43:18]:
Last and final question. Aaron, as we’re coming to the top of the hour, what advice would you give aspiring entrepreneurs looking at starting their own staffing firm in today’s economy? I know this might or might not be your expertise, talking to all those entrepreneurs, so what advice would you give them?
Aaron Grossman [00:43:34]:
Listen, when I started my company, it was July 4, 2001, [email protected]? Boom stuff. And then guess what? September 11 happened. A couple of months into it, economy crashed. So I was there. I started a business in that moment. One of the things, if you’re an aspiring entrepreneur, obviously think about your tech stack early. Put that at the forefront because the right tech stack can help you create automation and drive workflows and drive outcomes quicker and more effectively and efficiently. So I think that’s really important. Have the discipline and perseverance to overcome what’s going to be a hard road in that first year. I know. One of the things for me, there were two things I did when I first started. One, and I remember saying this to Kevin and to Chad who started with me, I’m like because one of the guys was just constantly, oh, my God, the economy’s bad. We’re not going to make shut up. Put your head down. Don’t think about anything. And I said this for six months, just put your head down. You know the activities that you need to do to drive the outcomes. Put your head down and just keep doing them. We’re just going to lift our head up. We’re going to be fine. Because guess what? Even though if the economy is bad, there’s a recession, there’s still competitors out there doing business with somebody, and that somebody should be our client. So go figure that out and find them. That was one thing, is just put your head down. The other thing that I did is, especially if you were never an entrepreneur before. And I was 27 when I started my business. I was still young. My first manager and staffing, her name was Tanya, and she sat right next to me, and she would critique everything that I did. And so what I decided to do is pretend that Tanya I had an invisible manager named Tanya that sat behind me when I started my business. She wasn’t real, but I pretended she was, and it created that fear that I needed. Like, I got to do this, otherwise she’s going to get on me. So I tried everything I could to make sure that I had the self discipline to do all the things that I wanted to do. The other thing that I would say that I did early on, too, is that and I see this a lot, because when you start, especially when you start your own staffing company, one of the first thing you see is just a sea of opportunity. Oh, my God, there’s so many opportunities. And what happens is that you can get lost in those opportunities and actually never get traction into anything. So I got super hyper focused into just a couple of verticals, and I stayed true to it. I found companies who would use labor in those verticals, and I just create sales pitches and sales and value propositions and messaging around that so that I can start capturing and getting in business into that. So that would be a huge piece of advice, too, is just really stay focused and don’t try to even though there’s a lot of opportunities to a lot of things, figure out what you want to do and get traction into that focus before getting into other focuses as well. That would be another piece of advice I give.
Kortney Harmon [00:46:27]:
That’s a great word of advice. And oftentimes I saw working with franchise owners, they’re like, well, I can go over here, and I can go over here. And they oftentimes got distracted. And to your case, they did nothing. They didn’t get any traction. They didn’t have the expertise. They didn’t even have the knowledge to have some of the conversations that needed to be had. So I love that piece of advice.
Aaron Grossman [00:46:46]:
Kortney Harmon [00:46:49]:
Smart and get yourself a Tanya. I mean, tanya’s, the new Karen. I mean, heck.
Aaron Grossman [00:46:54]:
There you go.
Kortney Harmon [00:46:57]:
Great words of advice. Anything else you want to share with our audience before we wrap up for today?
Aaron Grossman [00:47:02]:
No. Well, if you have any healthcare people, healthcare agencies, I do want to pitch my company Preyos Health, which is we just launched it in March, and it’s a marketplace. So if you’re a healthcare staffing agency and you know things like Vivian or, you know, a trusted Health or a Nomad Health that are tech first, or a staff nurse, we literally with preos. When we combine it into a traditional healthcare staffing agency, we turn them into a competitor to trusted health, nomad health, stamp Nurse overnight, Intelligare overnight. We basically give you your own version of Vivian overnight. It’s fully integrated into some ATS that we’re working with, and we’re continuing to identify other ATSs that we want to partner with that work with healthcare staffing agencies. It is the future of staffing. If you’ve read any articles in the past year, they say that within the next ten years, traditional healthcare staffing is not going to be around, and a lot of it’s going to evolve into what preos health can provide and become that conduit for those agencies. So I just wanted to pitch that really quick because I’m really excited about it. And then I think you had mentioned this at one point with talent launch. Right now, the companies that are in our network are companies that we’ve acquired, but starting next year, we’re going to offer our entire platform and support enablement functions to staffing companies that we don’t own. So we’re offering that as a licensing opportunity. So if you’re starting an agency, we could be a great you basically get the big company technology right out the gate. You don’t have to worry about integration or procurement or anything like that. You just become a part of the network as a member company. So that’s something that we’re going to be doing in the next year. We’re really excited about that, too.
Kortney Harmon [00:48:41]:
Such exciting new endeavors. Congratulations on all the new things.
Aaron Grossman [00:48:45]:
Kortney Harmon [00:48:45]:
Thank you. Erin, I’m going to wrap up because we have talked for nearly an hour. I’m sure you and I could go on for hours, but thank you so much for joining us today and sharing all of your insights and wisdom and your passion that you truly have.
Aaron Grossman [00:48:59]:
Thank you. I appreciate it. I love trying to help other entrepreneurs and staffing agencies grow, so hopefully this conversation helps.
Kortney Harmon [00:49:06]:
Obviously, this wraps up our amazing conversation with Aaron, again, a true leader in the staffing industry. And as we close in this enlightening conversation, in depth conversation with Aaron, he shared a wealth of valuable insights and expertise on various aspects of staffing firm growth and success. We also explored industry evolution, growth opportunities, and uncertain times. Things that he’s done, overcoming those challenges that he’s seen in our industry. What successful growth initiatives look like, and most importantly, continuous improvement and tracking those key metrics, performance indicators, and so much more. I encourage you to reflect on this knowledge shared by Aaron and consider how you can apply these insights to your own staffing ventures. Remember, building a strong foundation, embracing innovation, nurturing those relationships with the human element are key elements to achieving long term success in this ever evolving staffing industry. So thank you for joining us on the full Desk Experience industry spotlight. And if you found this episode insightful, make sure you subscribe, leave a review, and share with your colleagues and friends. So stay tuned for more captivating conversations and insights from industry experts. Until next time, I’m Kortney Harmon with Crelate. Thanks for joining us for this episode of Industry Spotlight, a new series from The Full Desk Experience. New episodes will be dropping monthly. Be sure you’re subscribed to our podcast so you can catch the next Industry Spotlight episode and all episodes of The Full Desk Experience here or wherever you listen.