For the last two years HRO Today listed TalentTrack, a recruitment process outsourcer (RPO) in its list of the top 13 RPO companies in the US. Today it may be the largest RPO focusing on healthcare. Editor Beth Ellyn Rosenthal talks with Kim Davis, President and Co-Founder, about how to get reluctant buyers to sign on the dotted line and why the leadership team has to read Blink and watch The Replacements.
Q: How do you get reluctant buyers to try your RPO services?
A: We are willing to do projects and pilots. Pilots give people a taste of our services before they buy. Afterwards, their receptivity goes way up. Our performance removes their fears.
We guarantee results with our service level agreements (SLAs). Everything we do has a written contract. They can see we put our own dollars at risk.
Q: Do you have a specialty or sweet spot?
A: Sixty percent of our business is healthcare. This year we will fill 8,000 clinical positions and 12,000 total professional positions.
Q: Why healthcare?
A: When we founded the firm in 2002, the US economy was in the midst of a recession. We looked at the financial vertical, but it was slowing down. But healthcare had extreme shortages. And we saw no competition. In addition, the healthcare industry is receptive to new things in HR because the talent crisis is so great.
Q: Did demographics play a role?
A: Absolutely. I believe the Baby Boomers are going to work longer but not in the same way. We estimate 40 percent of the US nursing staff will be over 50 by 2010.
At the same time, there aren't enough of Gen X (25-35-year olds) and Gen Y (16-25-year olds) with the skill sets our clients need. Healthcare employees need college degrees and certifications. Schools can't produce enough graduates fast enough.
Q: Are healthcare companies really that forward thinking?
A: Our clients realize their core competency is developing healthcare services. They have discovered they don't have the resources for talent management and recruitment.
But yes, our biggest challenge is our clients' mindset. I've found things haven't changed much in 20 years; people are still frightened of the concept of outsourcing. They don't want to lose control of their staffing.
But they are more receptive today because they have no choice. They don't have the right talent and they can't afford the high cost of per-diem staff.
Q: Who is your biggest competitor?
A: Our customers themselves. We respond to very few Requests for Proposals. We have to build relationships.
Q: What is your biggest challenge?
A: We have to educate our clients, especially since non-HR people are part of the buying process. And that's our biggest challenge-determining who our actual buyer is. Is it the CEO, President, CFO, senior VP of HR, or all of the above? However, the senior VP of HR always has a part in the buying process.
Q: Where did you grow up?
A: I grew up in a small town outside of Chicago called Mt. Carroll. I came from humble beginnings. My father dropped out of school in the eighth grade to support the family during the Depression. He worked as a custodian his entire life. My mother really never worked outside the home.
I am living proof that dreams truly come true with hard work. I believe anybody can do anything if they put their mind to it. But they have to be your dreams, not someone else's. I believe people are capable of doing anything. My daughter is dyslexic yet is graduating from college summa cum laude.
Q: Did you have a mentor back then?
A: My high school guidance counselor suggested I attend a two-year technical school because he knew our family had no money for education. However, that was never my dream. In the end, I received a basketball and academic scholarship and eventually received my degree from Northern Illinois University. Then I received my master's degree from Western Illinois University.
Q: How did you end up in outsourcing?
A: Even though I didn't have an engineering degree, I started my career as an engineer. I went to work for GTE in Genoa, Illinois. I went through a testing process and the human resources (HR) department thought I would make a good industrial engineer. I eventually worked my way up to engineering manager.
Then I went through another assessment process. The HR people told me I had an aptitude for sales and HR. I really didn't want to go back to school to become an engineer. So I took the HR job.
Q: How did you segue into recruiting?
A: United Technologies acquired the automotive supply company I worked for. At the time, I was a corporate HR director with significant employment responsibility.
Then, in 1989, my new boss, who had moved 25 times in his 29 years with the company, wanted me to move to Florida. I had moved multiple times in the past four years. My eldest daughter was now in the fourth grade. I decided I didn't want to move. I wanted my family to put down roots. I wanted my daughter to be able to tell people where she was from.
Q: What was your next move?
A: I left big corporate America and went to a 60-person recruitment firm with two offices. We grew this business to be the fourth largest outplacement firm in just seven years. We sold the company to Interim Services, which is now Spherion, in 1997. I joined the company at its corporate headquarters. I led the national sales and strategic-account management effort, which grew to $750 million in national revenue with 50-plus accounts.
Q: How did you become a specialist in RPO?
A: In 2000 the president of Spherion asked me to start a new business concentrating on RPO. I did that until I left in 2002.
Q: Why did you leave?
A: We struggled after September 11. And I realized I wanted to work in the healthcare space. Spherion couldn't enter healthcare until 2008 because of a prior legal agreement. I left to start TalentTrack with two other partners, both from Spherion. I moved back to Toledo.
Q: How did you start the firm?
A: We used our own capital. We have never had any long-term or short-term debt. We don't even have a line of credit. We decided at the outset we weren't going to use debt to fund our operations.
Q: Please describe your business plan.
A: First we hired the people. Then we built our solution and technology platforms. This took roughly 10 months. Then we went to market.
Q: Hospitals typically already have software in place. How do you handle that?
A: We are supplier neutral; we use the platform that's already in place. We know how to maximize their value. We have people who have backgrounds in 15 different platforms.
Q: What is your corporate goal?
A: To have our clients win the talent war.
Q: What's your favorite movie?
A: Enemy of the State with Gene Hackman and Will Smith. It's about a person who is falsely accused by a special group within the FBI. They start ruining his life. He talks about being small, nimble, and quick versus the government which is slow. He has the resources to fight back. I actually share that part of the movie with our new recruits.
Everybody has heard of IBM and Hewitt. Who's heard of TalentTrack? We try to show our people we have a lot of advantages over the big boys.
I also show our team The Replacements with Gene Hackman and Keanu Reeves. After the replacement team loses its first football game, Hackman holds a session in the locker room. He asks each player to name a fear. We all have fears. The only way to get past them is to think about them, then use them to make you stronger.
I watch those movies over and over again.
Q: What's the last book you've read?
A: Blink by Malcolm Gladwell. This book is required reading for my leadership team. It got me to think about how my past affects my present. I agree that quick decisions really work; you have to make decisions with the data at hand, or you will be in a constant state of paralysis.
Q: How old is your daughter now?
A: I have two daughters in their twenties.