 |
 |
 |
investor relations
business from A to Z
investor relations services
| stock information | more | |
|
RAND.AMS |
|
| €28.49 | - 0.22 |
|
20 November 2009 17:35 CET |
|
Strategic growth drivers
Structural growth One of the most important factors driving the long-term structural growth in our markets is our clients' need for flexibility. A more flexible workforce helps them improve productivity and be more competitive. Structural labor shortages, made particularly acute by an aging population together with declining - and often negative - population growth in Europe and elsewhere, increase this need over the long term. Average penetration rates (the percentage of staffing employees in the total working population) therefore generally increase with each cycle. Yet only in the most developed staffing markets, such as the UK, the Netherlands and France, have these rates exceeded 2%, so the potential structural growth over the longer term is enormous. However, the structural growth element will sometimes be more than offset by economic developments, causing temporary declines, as there is a clear cyclical element as well. If gross domestic product growth is high, the labor market needs more of the skilled people we provide. In times of slowing economic activity however, demand grows more slowly, as it did in the first half of 2008, or declines, as it did for the rest of the year.Deregulation
Another driver of market growth is deregulation, a factor we try to influence as much as possible. While deregulation is a well-known and accepted term, we stress that we are not looking for a system without rules. In fact, we strive on the one hand for the lifting of unjustified restrictions in overregulated markets, and on the other for a fair and effective regulatory environment in markets where this has yet to be introduced. New opportunities continue to open up as governments increasingly recognize the need for flexibility in their labor market. In terms of the countries that together contribute a large portion of Randstad?s revenue, a major step forward was taken on October 22, when the European Parliament adopted the Agency Work Directive. It recognizes the positive role of agency work, provides more flexibility, and must be implemented by all EU member states in their national legislation by 2012. A very positive aspect of the Directive is the obligatory revision of all restrictions on temporary agency staffing in the coming three years, and the subsequent lifting of those that are unjustified or disproportionate, such as the bans on the use of temporary agency workers in the public sector in France, Belgium and Spain. The removal of restrictions in terms of contracts and sectors we can serve will significantly accelerate growth in many of our key European markets.
Clients looking for a total offering
The third factor that is becoming increasingly important in driving growth in our markets is the trend for clients to be looking for and to use a broader range of HR services, from staffing through recruitment to outsourcing. Randstad's comprehensive portfolio of services was already unique in our industry. The combination with Vedior has further enhanced and balanced our offering and given us a strong presence in almost all major markets. More clients are looking for global solutions, establishing international staff procurement organizations. Our international account management team coordinates collaborative efforts across all our country operations to offer cross-border service agreements based on quality and cost efficiency, making an increasingly significant contribution to total revenues. We are participating in many more international tenders, and received twice as many tender requests in 2008 than we had the year before.
Please also visit "Strategy" and "Strategic building blocks"Portions of this page copyright © Investopedia.com
