Phil Gripton of Waypoint Partners
The past two years have seen a massive shift to digital technologies with unprecedented demand for new solutions. Whilst the pandemic has accelerated this swing, it’s not the only force driving the change. People are also interested because digital businesses are quick to generate cash and the impact they create for clients is easily measurable.
However, the increase in demand has been met with a lack of supply, creating the perfect storm of shortage. With digital entities at a premium, so are the specialist skills needed to make them happen.
The key side effect has been salary inflation and in the battle for talent it has become a candidate’s market. Recruiters are drowning in so many requests they are having to turn would be employers away.
The competition for skills is getting bigger
For agencies, the situation is manifesting into a real problem as it becomes harder to secure the right employees to fulfil growth ambitions. This has been compounded by an increase in recruiter competition which is no longer limited to other agencies. Now, the big guys are coming to fish in the same pond too.
Consultancies like Deloitte, Accenture, and KPMG have created digital practices through Covid and are looking for skilled people. Large corporates are also augmenting their in-house teams to reduce their reliance on third parties.
Private equity is funding companies such as Brain Labs, Croud and Jellyfish to go out and build more digital businesses. Even the big networks are back in play again having gone through their period of consolidation and are devouring talent.
Put simply, it’s a hot market, and everybody is competing for the same people.
What are agencies telling us?
During the pandemic, Waypoint Partners surveyed agency leaders, and asked them to identify what key actions they were planning to develop their workforce. Some 75% responded that improving digital skills would be critical to the success of their business.
However, when we asked about the barriers to making this happen, they all identified insufficient resources to cover the learner in their absence. “How are we going to make sure, with so much work on, we can make it all fit?” There was also concern about how to put a structured approach together that would let the initiative run without their constant input.
Finally, about half of our respondents said that they didn’t have enough budget set aside and there was reluctance to allocate non billable hours to a team when they were learning.
How are successful agencies turning the tables?
So, what can be done to mitigate all these difficulties? There are three key actions coming to the fore:
- Firstly, it’s about building a strong employer brand. To attract and retain the best talent, you’ve got to make sure your employer brand is something that’s differentiated and what you offer employees; salaries, bonuses, flexible working conditions etc, are best in class. Otherwise, employees are going work somewhere else.
It’s also about focusing on building a ‘people first’ culture for your employer brand. It’s not just about “let’s hire people and pay them decent money and everything will be fine”, it’s more complex and requires a sense of purpose.
- Secondly, smart leaders are concentrating on up-skilling people. You need to make sure that your team are equipped to deliver the best quality of work and driving efficiencies, thereby improving profitability. This is crucial, because it’s impossible to invest in your employer brand if you don’t make profit. Profit is what you use to fund growth, development, investment in four-day weeks, and other initiatives. These are not cheap to do, so having a functioning business is vital.
However, it’s not only about existing teams, up-skilling can be used to bring in more junior people too. By immediately investing in their skills and abilities, you can create loyal, capable employees who perform and work well with your clients.
- And finally, successful agencies are reaching out and using government funding to pay for the vast majority of what they need. The government have put aside millions of pounds to help businesses invest in training, and many agencies don’t realise they can go out there and get their hands on it. That money is sitting there waiting to be spent, so it’s important to look at what’s available.
All in all, it’s an incredibly daunting situation, but it’s not an unbeatable one. Through careful planning and research into funding, it is possible to alleviate the challenges and invest in your people, develop their talent, and enjoy the benefits of doing so.
