Recruitment Technologies Costs Coming Down – Interview with Col Levander featured in Shortlist 16 January 2017
Recruitment business owners can expect to pay lower prices for business-critical technologies thanks to an influx of
offshore providers coming to Australia this year, according to advisor Col Levander.
Software houses and developers are increasingly offshoring their development to developing and emerging economies, particularly Vietnam, India, the Philippines, and Thailand, he told Shortlist.
Levander, who heads RecTech Solutions, expects this will have a significant effect on the local recruitment market, because “essentially, businesses and software houses can then develop their products a hell of a lot cheaper than what they would onshore”.
At least four new software providers will have entered the front-office software market providing recruitment management systems (such as ATS and CRM solutions) before the end of the financial year, says Levander.
These offshore providers will come in at a price point that could be anywhere between 20–30% cheaper than in the current local market, he says, creating a buyer’s market for recruiters.
Some of the cheapest and most ubiquitous recruitment software solutions currently on the market average around $99 per month per user.
By comparison, the newest products are likely to cost between $50–70 per month per user, Levander says.
“What it’s also going to do is lower the barrier to entry for smaller and start-up agencies.”
The savviest software houses employ expats in their offshore locations to run the development teams, and these “are the ones that are going to change and shake up the industry. [We’re] seeing that already”, he says.
Although an understanding of the local industry remains important in the recruitment software arena, he says, it’s much easier for offshore providers to enter the front-end recruitment software market, “because recruitment has a widespread general workflow process”.
The back-office software market – payroll, for example – is more compliance-driven in comparison, Levander notes.
An increase in offshoring for recruitment software development can be “fraught with danger” however, as professional standards vary by country as with other industries.
Levander says the questions recruiters should ask before investing in any new software include: “What’s the support mechanism? How are those systems maintained? What is their understanding of the Australia and New Zealand market?”