Online Extra: The McDonald's of Temporary Staffing?

Randstad CEO Ben Noteboom says the Dutch firm's strength lies in standardizing all aspects of its business
The BusinessWeek 50

Ben Noteboom, CEO of Amsterdam-based temporary staffing agency Randstad, likes to say his outfit's goal is to be very boring and predictable. "The only surprise should be in the numbers," he says. He's talking about upside surprises, of course. In fact, Randstad has come roaring back since 2002, registering a profit increase last year of 160%.

But how do you keep that kind of momentum going in Europe, where growth is so slow? Noteboom recently addressed that and other questions in an interview with BusinessWeek European Regional Editor Jack Ewing. Edited excerpts of their conversation follow:

Q: A couple of years ago Randstad sales were declining, and the outlook didn't look too good. What went wrong?

A:

After 38 years, our founder [Frits Goldschmeding] stepped back in 1998. If you have to follow a genius, that's not very easy.

Q: You call yourself the McDonald's (MCD ) of the temporary staffing business. What do you mean by that?

A:

We have a very strong conviction that if you want to be successful in a service industry, you have to be able to multiply what you know works. We have standardized all aspects of the company: How to do sales, recruiting employees, accounting.

In every market where we have finalized this concept, we have gained share. Our market share in the Netherlands has gone from 34% to 39% in the last three years.

Q: Randstad has offices in 16 countries in North America and Europe. How do you get employees all over the world to stick with the program?

A:

Success is contagious. If people see that something actually works, they are more willing to follow. It takes quite some time before everyone is aware. The biggest part of my time, at least one day a week, is spent visiting branches in all our countries.

Q: What's the outlook for the future, especially given that European growth is very slow?

A:

We are not pessimistic at all. We have a mix of more mature and very immature markets. Penetration rates of staffing are still very low in some markets. The German penetration rate is 0.9% [of the workforce] vs. 2% to 4% in more mature markets. There is still a lot of growth potential.

Q: Do you see any effect on business from the votes in France and the Netherlands to reject the European Union constitution?

A:

It's very important that we have an open market and no borders. I don't think personally the "no" votes in France and the Netherlands will make a big change. It's a strong signal to politicians, but it's not what keeps me awake at night.

Q: What's your advice for succeeding in a slow market?

A:

If you do the same thing as everybody else, you will have average performance. You have to have different ideas [such as Randstad In-house, in which the company sets up offices on the customers' premises and takes responsibility for finding all necessary temporary help on short notice].

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