Sabana Consulting

Competitive Analysis 

 

PORTER'S FIVE FORCES ANALYSIS

 

 

I. COMPETITIVE RIVALRY

 

1. In Colombia there are 610 private employment agencies

2. Industry service fixed costs are average.

3. Price strategy is standard among the industry

4. Multinational headhunting companies have a strong presence in the Colombia with local based branches

5. Multinational Organizations have worldwide contracts with known Talent Acquisition companies

6. There are few companies competing in mid-level of management executives search and operational and unskilled workers.

7. There is a strong offer in searching top executives, management, leaders, c-level and top managers as well as board members

8. There is another competitive segment of market, related to medium-sized and new international companies establishing in Colombia, looking for operative personnel and general office workers

9. The presence of organizations offering new interviewing, assessing  and testing standards and technologies is small

10. The rivalry of highly specialized competitors in medium sized and new organizations is low

11. Consumers in search of talent, switch supplier easily.

 

 

II. NEW ENTRANTS THREAT

 

1. Capital investment requirements are relatively low

2. Geographic and cultural factors in Colombia limit the competition

3. Entry Barriers in Colombia are high

4. Too many agencies are being utilized across the same business segments

5. There is a loss of good candidates profiling through an unprofessional or unstructured recruitment processes.

6. There is a lack of consistent screening methods for curriculum vitae

7. There is a lack of relationship management skills at operative and general office workers

8. There is not sufficient knowledge of specialized segments from individual agencies

9. Clients and candidates are probably loyal to Specific Agencies,

10. There are few economies of scale

 

 

III. SUBSTITUTES THREAT

 

1. CTA´s: Worker Cooperatives

2. New recruiting trends are emerging

3. Social media (Facebook, LinkedIn) is also changing the landscape for hiring managers and human resource

4. Skilled professionals are now searching job listings online, using job search engines and Organizations´ web sites

5. Direct hiring to drive down costs

6. Staff loyalty and internal promotion is a substitute for recruitment

7. The use of press advertising and handling of their own processes

8. Consumers in search of talent, switch supplier easily.

 

 

IV. SUPPLIER'S BARGAINING POWER

 

1. Recruiters have an extensive knowledge of local labor markets of special niche sectors

2. They have access to extensive data bases of available workers and also of passive candidates that do not apply to advertisements, or do not participate in job fairs and are not registering at corporate websites

3. The Colombian recruitment industry has developed a structure around specialized sector or business opportunities

4. They have the specific expertise and technology necessary to provide the service

5. The cost per hire is increasing in different industries.

6. Companies are having a high turnover due to bad recruitment policies and procedures

7. Recruiters have a clear understanding of the market including: salary surveys, skills competencies and key reasons for candidates to join any organization.

 

 

V. CUSTOMER'S BARGAINING POWER

 

1. Customers and Buyers require special customization procedures

2. The speed to direct hire is lower in days, than recruiters process who report an average of 2 months

3. Direct recruiting reduce costs

4. There are few Recruitment Agencies that have dedicated resources to recruit specialized talent

5. Organizations feel recruiters are not able to attract the experience and skills necessary to meet specific company’s business objectives

6. Changes in recruitment process have taken different forms, one of the most common is the continued growth of internal recruitment expertise by using social networking, driving down some costs

7. Clients could use multi-sourcing to attain the best proposal for a given process.

 

 

CRITICAL THINKING

 

Our market insight and our advisory services are oriented to be the best in the headhunting and recruiting industry in search of the highest and most adequate profiles, by offering a range of tailored solutions, from full-time staffing, contract-to-hire and contract assignments, managing services and technology solutions, to gather market intelligence to comply with our clients´ requirements.

 

The Talent Acquisition and Recruiting industry is an entrepreneurial opportunity that requires a low capital investment and strong networking competencies.

 

Although it is a highly competitive industry, there are sizes and segments of the market that are growing due to global opportunities that are presenting professional opportunities for our Project.

 

We have noticed that technology leadership together with a focus on those unseen opportunities and niche sectors, are the doors to new strategic and successful entrepreneurs.

 

If we want to succeed we need to differentiate in terms of type and size of industry, our service level and the use of technology and on line tests applications.

 

We have also understood that Service levels are poor and inconsistent and that small clients show better satisfaction levels. This is the reason why we should consider this segment of the market as a priority for our project.

We will need to look closely and understand the new role and impact of social networking in order to take advantage of using it for our benefit.