Back in more analog days, before the large-scale adoption of applicant tracking systems, client relationship management software, back-office systems, and more, there was a simple solution for staffing firms to track operations: the whiteboard.
Job orders, available candidates, dates to fill, etc. would all be visually represented in simple terms. It was easy to track and understand, but offered no insight, and would disappear just as quickly as it came.
Entering the digital era meant translating the principles of whiteboard tracking to another easy solution: spreadsheets.
Unfortunately, even though staffing firms have ramped up investment in dedicated staffing technologies, old habits die hard. Many agencies still use spreadsheets as a supplement or outright replacement for their tech stack.
In this article we’ll discuss why that happens, why it’s so dangerous to staffing operations, how to fix spreadsheet dependency, and what firms stand to gain when they do.
Why Staffing Firms Turn to Spreadsheets
Spreadsheet dependency doesn’t happen overnight. Oftentimes agencies turn to spreadsheets because they fill an operational need. But over time, as more data gets entered, they become more of a system of record than initially intended. Some of the reasons spreadsheets enter the picture:
- Simple Ways to Track Exceptions: Staffing is not one-size-fits-all. Every customer has their own unique circumstances; different states have different compliance requirements, some clients have different shift differentials, some bill weekly while others bill monthly. Rather than taking the time to configure dedicated tools to accommodate for these exceptions, it becomes easier to enter client-specific data into a spreadsheet. Eventually, the spreadsheet becomes the source of truth on servicing that client.
- Garnering Data Insights: Particularly for sales and accounting teams, but across entire staffing organizations, Excel is the default for presenting and translating data insights. Part of the reason firms turn to spreadsheets is a disconnect in systems. One report showed that only 25% of staffing firms had integrated systems, which makes spreadsheet reliance for data insights almost inevitable. So if management asks for details on branch performance, assignment duration details, or gross margin questions, it can be the default to throw all of the data from the CRM into Excel and extract insights that way. More on why this is a problem later on.
- Internal Organization: Recruiters manage a lot. From talent assignment statuses to contracts to an ever-expanding set of compliance requirements, the amount of information that needs to be monitored can be overwhelming. As a result, spreadsheets can become a de facto repository for managing crucial information. This impulse to get organized can be beneficial in the short term, but before you know it, individual spreadsheets become the source of truth for an increasing amount of important dates, data, and details.
To be clear, using spreadsheets is critical for many staffing firms. They can offer organization in a simple visual representation. When they become a problem is when they become a replacement for tech stack investments the firm has made.
Let’s take a look at why spreadsheet dependency is such an issue.
When Spreadsheets Become a Problem
The problem with spreadsheets isn’t the tool itself, it’s what they replace. In a perfect world, a staffing firm’s ATS, CRM, back office software, etc. (bonus points if they’re all one system) should be the central repository for all client, financial, and employee data.
Pulling data out of that system and into spreadsheets has many negative effects; let’s dive into a few of them.
- Manual Data Replication is Unreliable: Earlier we talked about using spreadsheets to garner data insights. On its face, this use of spreadsheets isn’t bad. The problem is, all data needs to be manually ported over from a firm’s ATS, CRM, etc. Any time there’s a manual transfer of data it leaves room for error; and it turns out spreadsheet error is incredibly common. A salesperson may be working on earnings forecasts and miss a crucial piece of data in the transfer process. Building reports directly within your source of truth, central data hub ensures reliable insights.
- Disparate Version Histories and Poor Document Management: When spreadsheets become the source of truth, one single version of a spreadsheet needs to be maintained, accepted, and adopted by an entire organization, which often isn’t the case. More times than not, if management asks sales, operations, finance, etc. how many open orders there are, for example, they’ll get three different answers if those teams are working off of their own versions of a spreadsheet. Keeping a well-maintained central source of truth within the ATS and CRM is the best way to ensure everyone is operating off of the same and most up-to-date information.
- Data Security: When spreadsheets house critical information for a staffing firm’s sales pipeline, talent roster, financial information, and more, it becomes nearly unaccountable. If a team member was looking to start their own agency, there is little stopping them from walking out the door with valuable data. What’s more, if spreadsheets are used to store sensitive information like employee Social Security numbers and addresses, it leaves a firm open to all types of security liabilities.
- Institutional Knowledge and Access to Information: Another major problem with spreadsheet dependency is it not only makes the documents themselves vital, but it turns the owner of the document into a silo or a bottleneck. How many times have you needed a key piece of information only to find that it’s stored within a document or spreadsheet that only one person has access to. If that person goes on vacation or leaves the company, it creates a void of knowledge transfer that puts operations at risk.
In the end, spreadsheets may be a convenient sandbox for ideas, but when they become ingrained in a staffing firm’s processes, they quickly become unaccountable, unreliable, and insecure.
How Staffing Firms Can Remedy Spreadsheet Dependency
Spreadsheet dependency is one of the many modes of organizational drift within a staffing agency. Because they’re often owned and operated by individuals, reliance on them speaks to a broader concern about standardized processes across a company.
To fix spreadsheet dependency, the first step needs to be understanding which spreadsheets are most critical, who owns them, and why they were created in the first place.
From there, all information within the identified spreadsheets should be verified to exist within a central source of truth like an ATS or CRM.
Spreadsheets aren’t created by accident; they’re made to build some workaround to inconvenience or lack of functionality within the tech stack. More often than not, the desired functionality exists, but there isn’t a set process in place to extract it out of the tech stack.
Putting in place set standard operating procedures (SOPs) that define the process within the tech stack that was avoided by creating a spreadsheet can not only remedy the impulse to create spreadsheets in the first place, but builds a repeatable process that isn’t reliant on one person. As employees change roles or jobs or go on vacation, there’s a playbook in place to replicate the process and avoid workarounds.
What Staffing Agencies Stand to Gain By Fixing Spreadsheet Dependency
Spreadsheets serve an important purpose for staffing agencies. They only become a problem when they become the source of truth beyond a central ATS, CRM, or back-office system that are not only a major investment for firms, but more than capable of handling the insights and organizational abilities that spreadsheets offer.
By addressing spreadsheet dependency, staffing firms are able to remove bottlenecks within their operations, create repeatable, reliable processes that withstand personnel changes, and build from a shared foundation of truth in data.
Whiteboards were the standard in the pre-digital era. Spreadsheets were the natural evolution of that organization structure. Now that we’re in an era where staffing firms are managing thousands of workers in increasingly complex regulatory, tax, and compliance environments, spreadsheets are no longer equipped to meet the needs of modern staffing.
Leveraging the capabilities of the CRM, ATS, and back-office systems you invest in helps ensure a more resilient organization and sets the correct processes in place to enable the kinds of faster, smarter decisions that drive growth.