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UAE2022 SPI Reveal: As the Market Heats Up, So Do the Challenges That Lie Ahead For Attracting & Retaining Talent in a Competitive Market
When looking at the data, 2021 was one of the best years in history for professional services firms. During this time, firms of all sizes found a path to success by finding new ways to work from home and delivering projects remotely. Despite this success, consulting and professional services organizations still face challenges. By far, the most substantial headwind revolving around attracting and retaining talent in a competitive market. While the Great Resignation continues to force organizations to re-evaluate their processes and change perspectives on how to run their businesses more efficiently and effectively.
With this type of market uncertainty and growing competition top of mind, it is more important than ever to benchmark yourself against other firms in the industry. The SPI Benchmark Report, now in its 15th year, has become the go-to consulting marketing report for leaders to gain insight into ways they can analyze the performance of their organizations and improve processes to achieve service excellence.
“As an executive leading a global consulting practice, I strive to enable my team with the resources, technology and data to act quickly and efficiently. By studying industry benchmarks we have been able to set clear goals for future growth and discover efficiencies others use for project success.”
– Timothy Bailey, Vice President, Deltek Global Consulting
What the Data Tells Us About Attracting and Retaining Talent
We recently hosted the 2022 SPI Benchmark Reveal Webinar, with Dave Hofferberth, Managing Director of the benchmarking firm, Service Performance Insight (SPI) and Michelle Cipollone, Vice President of Product Marketing at Deltek. This annual event provides professional services firms with an excellent opportunity to gain insight into this year’s industry benchmarks and learn about the unexpected challenges to watch out for in 2022.
Leaders from consulting and professional services firms attending the event agreed that attracting and retaining talent in a competitive market was one of the areas where organizations needed to improve the most. This challenge appears to be an ongoing trend, given that this is the second year in a row that attendees have selected talent as a rising issue. We face the same challenges every day here at Deltek ─ we’re no different than any company in that regard. However, I do believe we’re doing a great job at taking care of our #TeamDeltek employees ─ there's no doubt there's a war on talent out there and something we need to be aware of.
Meanwhile the strain of the Great Resignation can be felt across the industry. According to SPI Research, voluntary attrition surged to a five-year high of 9.8% in 2021 versus just 6.9% last year.
In addition to losing more people, firms are also facing longer times to adequately recruit and train their employees. Last year, it took IT Consulting firms an average of 61 days to recruit and hire new employees for a standard position ─ five more days than the year before. Unfortunately, similar trends in recruiting times are also happening in Software, Architecture/ Engineering and Advertising and PR companies.
The length of time to recruit and ramp up new employees are very important determinants in overall performance, sustainable growth, and profit. Ramping time is critical because it not only focuses on making employees productive faster but also reduces the non-billable time and cost of other resources who support the hiring and onboarding process. According to the consulting market report, in many cases, the full costs of recruiting and hiring are over 50% of the first-year new hire’s base salary.
What Leaders Can Do
The good news is that there are things business leaders can do to improve hiring and retention rates. In this year’s SPI Benchmark Report we found that higher numbers of guaranteed training days positively correlate with attrition and net profit. Noting that access to high-quality training is a major workplace attraction driver and investing in employee training typically leads to increased performance.
The report also shows the value of a well-defined career path. Highlighting that employees who are invested in their individual development plans are more likely to recommend their firm as a great place to work, are less likely to leave. Interestingly enough, the study also found that billable employees with a well-defined career path, contribute on average a 3% higher utilization rates and over 6% on-time project delivery, which is great for any firm.
Overall, leaders who can create an environment where an employee can learn, grow, and develop their careers will find greater employee satisfaction and ultimately a stronger bottom line.
For a deeper understanding of these and other important benchmarks download the 2022 SPI Professional Services Maturity Benchmark Report here. To learn more about how Deltek can help power project success for your project-based business, subscribe to our Inside Deltek Project Nation newsletter and follow us on Twitter and LinkedIn.
Read Next: 4 Reasons Project-Based Businesses Should Measure Employee Engagement
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