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KPI's in staffing industry

Gloria Vigil's Profile

Can anyone share the top 3-5 KPI's for the staffing industry?

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Tim Brands
Title: CEO
Company: iBusiness Solutions
(CEO, iBusiness Solutions) |

Here are a few we track:

1. Profit per hour (see Jim Collins' book Good to Great) = net operating profit / total company hours worked. This metric gives us a good number to compare across time regardless of billable staff vs. back office staff ratio, the number of billable hours in one year vs. another, etc.

2. Utilization rate = billable hours of consulting staff / total hours of consulting staff

3. Personnel expense ratio = personnel expenses (for us this is cost of revenue) / net revenue. Our fully loaded personnel expenses include payroll, benefits, training, T&E, etc. The personnel expense then become our single biggest expense category. Our profit margin is largely determined right here.

These are all lagging indicators. We do look at a few leading, or forward looking, indicators as well, which are a little more difficult. I would suggest starting with the lagging indicators. If you calculate them frequently enough (we do them all weekly) they are very timely even if they are lagging.

Finally, because of how we set this up, we can calculate these metrics by time (year, quarter, month, and week), by employee, by client, by line of business, and more. Very powerful!

Tim Brands
tbrandsatibusiness-solutions [dot] biz

Mark Gandy
Title: Founder/Owner
Company: G3CFO
LinkedIn Profile
(Founder/Owner, G3CFO) |

Consider putting yourself in the shoes of the customer (that's what we call them in the staffing industry). Here are a few:

1. Fill rate ... I'd show this by sector, like clerical, light manufacturing, and office. If the staffing business has more than one office, I'd show by office too.

2. Closely related to -1- above is candidates per job slot. The more the better from the customer's perspective. Additionally, this number is insightful from the staffer's point of view as it addresses the efficiency and effectiveness of their supply-side pipeline.

3. Complaints or incidents by (you fill in the blank). Bottom line, the customer wants a great staff person who is as low maintenance as possible. More complaints/incidents mean a hit to the staffing company's brand and ultimately lost revenues.

Are you good with tools like Tableau or Qlik? And do you have access to systems like Avionte?

If yes to both, gross profit is key in this business in this low-margin business. Slice and dice your gross margins by sector, geography, sales rep, and customer size.

Since there can be a lot of repeat business in this industry, using the same data set above, you can create some dynamic visuals showing revenue by key customers--both trends and year-over-year comparisons focusing on lost revenue and/or gross margin dips.

The above should be a decent starting point.

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