One area that few firms have explored is e-recruitment. Traditional online recruitment services have centred around job postings on Internet boards such as Monsterboard.com. But, in a move that could signal a new direction for the recruitment market, ERP supplier SAP has joined with executive search service Futurestep to create an online personnel management service called Recruitment Factory that will integrate with SAP software.
ERP applications such as SAP have incorporated human resource functions for a long time - SAP's competitor PeopleSoft has its roots in the HR software market - but Recruitment Factory promises to integrate internal human resource functions and online personnel management services.
Palle Bisgaard, president of business solutions for Futurestep's European operation, said the service will enable SAP users to manage both job candidates and existing employees.
"It is an end-to-end system. It posts job openings on job boards, tracks candidates and logs them into the back-end system. But it goes further than that because it also includes a service element," he explained.
The service component stems from a database of company-specific personnel that Recruitment Factory customers can maintain using a managed service.
This is exactly the sort of thing that the current Web service and ASP evangelists have been preaching for the past six months. Although the company will not be offering e-learning in the first edition of the service, it would be only a short step to factor online training into the service.
Of course, making this system work in practice and convincing customers to buy into it will be an uphill battle.
For one thing, personnel information is one of the most sensitive types of data in an organisation and, even though Bisgaard preaches security, many companies are bound to be sceptical about storing such information outside the firewall.
The DTI recently released proposed amendments to its employment agency regulations. One of the most significant changes makes it easier for firms to approach contractors who are working for them under a recruitment agency and offer them permanent positions, without having to pay a penalty fee.
Anne Swain, chief executive of the Association of Technology Staffing Companies, believes that this will lead to a shakeout in the recruitment agency business because agencies will not be able to hold onto their contractors as easily as they did before.
Kevin Barrow, a partner at law firm Tarlo Lyons, thinks that contractors and end-user companies will begin to question the benefit of using recruitment agencies as go-betweens. What is likely to happen is that, as the margin is eroded from the contractor supply business, the larger recruitment firms will move into managed services, such as those announced by Futurestep. Added value will be the order of the day.
While such predictions must be taken with a pinch of salt - firms often enjoy the benefits of using contractors rather than permanent staff - there is a definite market for value-added business services such as personnel management. These services will bring a greater level of maturity to a market that currently relies on disconnected systems and manual interaction with online job boards.