With her easy demeanour and ability to build rapport with just about anyone, Ms Adeline Sim is the consummate people person.
"I've been told that I'm all about people, people, people, and it's true," said the executive director of HRnetGroup, which made its trading debut last Friday on the Singapore Exchange (SGX).
"My dad always says that anyone he meets should benefit from that encounter, and that has become a driving philosophy for us at HRnet," Ms Sim, 36, added, referring to group chairman and human resources veteran Peter Sim, who founded HRnetGroup in 1992.
With 10,500 contracted staff at any one time, and more than 8,500 permanent placements across the region per year, the largest Asia- based recruitment agency in the Asia-Pacific ex-Japan wields considerable clout. "That amounts to one placement every hour. So the number of lives we can positively impact is tremendous," she said.
Started as a one-stop shop for human resource solutions, HRnetGroup has grown to 24 business units with 838 full-time consultants as at the end of last year, from 17 business units and 426 permanent employees a decade ago. With more than 2,000 clients, its operations span 10 cities - Singapore, Kuala Lumpur, Bangkok, Tokyo, Hong Kong, Taipei, Seoul, Beijing, Guangzhou and Shanghai.
The group has 10 brands, including HRnetOne, RecruitExpress, PeopleSearch, SearchAsia and RecruitFirst. It specialises in industries ranging from healthcare, life sciences, finance and legal, to retail, consumer, industrials, telecommunications and technology. It also offers payroll processing, HR consulting and corporate training.
My dad always says that anyone he meets should benefit from that encounter, and that has become a driving philosophy for us at HRnet.
MS ADELINE SIM, executive director of HRnetGroup.
HRnetGroup is SGX's second mainboard listing this year. In its initial public offer (IPO), HRnetGroup issued 193.4 million new shares at 90 cents each. Due to overwhelming investor response, the 85.7 million placement shares in the IPO were 13.17 times subscribed, while the 3.4 million shares in the public tranche were 68.34 times subscribed. More than half, or about 103.9 million shares, went to cornerstone investors, while 440,800 shares were reserved for directors and staff.
Cornerstone investors include Aberdeen Asset Management, Affin Hwang Asset Management, FIL Investment Management (Hong Kong) and Meiji Yasuda Asset Management. Strategic investors include TechnoPro, one of Japan's largest technology-focused staffing and service companies, as well as Jasdaq- listed recruiter en-japan inc.
Heliconia Capital, a unit of Singapore investment firm Temasek Holdings, has been a shareholder since last October and will hold about 1.95 per cent post-IPO.
Heliconia and Simco - the Sim family vehicle that holds about 74 per cent of HRnetGroup post-IPO - have agreed to a six-month lock-up period from the listing date.
PROVEN TRACK RECORD
Over the last 10 years, HRnetGroup has grown revenues and earnings by a compounded annual rate of 12.8 per cent and 14.6 per cent, respectively. It has been in the black every year since it started operations, except for 1998. As at Dec 31 last year, it recorded revenue of $365 million and net profit of $48 million. Cash and cash equivalents stood at $106.1 million.
According to Frost & Sullivan, HRnetGroup has a market share of 20.6 per cent in Singapore, and is also the most profitable recruitment player in terms of pre-tax profits.
Looking back, Ms Sim vividly remembers helping out in the family business during school holidays. Her tasks ranged from photocopying application forms to filing documents for candidates and plugging clients' staffing vacancies.
Ms Sim graduated with a Bachelor of Law degree from the National University of Singapore in 2003, and joined Drew & Napier the following year where she was engaged in, among others, general corporate work and dispute resolution.
It was only after her son's birth, and when her daughter was two months old, that she returned to the fold. In 2009, Ms Sim became legal counsel at HRnetGroup, and was named general counsel seven years later. Last month, she was appointed executive director, overseeing HRnetGroup's corporate strategic and tactical legal initiatives.
Ms Sim believes in cultivating a strong entrepreneurial ethos in the company. Diligence, discipline and integrity are some of the group's defining values, along with agility and a focus on the bottom line.
"Although we are a professional services company, we're very much driven by schedules, processes, meetings and practices. Our daily programme includes fingerprinting in before 8.30am, a wellness exercise, and our morning sales meeting, where we track sales activities and numbers," she said.
BUILDING A LEGACY
Ms Sim attributes the process- driven mindset to the legacy built by her father, and her uncle - RecruitExpress group chief executive officer J. S. Sim. "It's that same focus on efficiency," she added.
HRnetGroup also has a sales- driven culture, with about 85 per cent of employees holding sales roles. "In our organisation, there are no receptionists, no secretaries and no drivers," she said.
To sharpen that edge, particularly for those fresh out of university, employees are given a detailed sales manual and taught the 10-10-3-3 rule to boost success rates of matching candidates with clients, Ms Sim said.
Every week, each employee is encouraged to set up 10 internal interviews with potential candidates, send out 10 profiles to clients, and set up three appointments for clients to meet candidates. This will result in a minimum of three candidates starting work per quarter.
Remuneration packages and promotion criteria are equally transparent. "You don't have to carry your boss' bag to get promoted. For someone new, if you chalk up sales in excess of five times your payroll costs for two straight quarters, that's an automatic promotion."
The company's profit-sharing - rather than commission-based payouts - model also sets the tone. "This directs the energy of every team member to focus on, among other things, gross profits instead of market share, and cost-effectiveness instead of budget spend. This means everyone is motivated to ensure everyone else in their business unit is performing well," she added.
The IPO will help HRnetGroup build on its co-ownership model, and also result in up to 404 more employees becoming shareholders, motivating them to continue growing profits. A total of 22 shareholders in specific subsidiaries will also have the option of swopping a portion of those holdings for shares in the company.
FIRE IN THE BELLY
"Some people think this is a crazy place to work in. Those who stay with us must be self-starters, and have the fire in them to succeed. If you're looking for a nine-to-five job, this is not for you," she said.
Meanwhile, prospects for the recruitment industry are rosy. "Flexible staffing is an easy way for companies to operate and this trend, which is very common in the United States, is gaining traction here."
With its IPO proceeds, HRnetGroup plans to ramp up operations in North Asia, particularly in Tokyo and Shanghai, with a focus on temporary and contract staffing, as well as professional recruitment services.
Frost & Sullivan estimates the market for flexible staffing and professional recruitment services in North Asia is valued at $46.3 billion, versus $3.6 billion for Bangkok and Kuala Lumpur, and $1.4 billion for Singapore.
HRnetGroup's North Asian operations account for nearly 39 per cent of its gross profits. In comparison, Singapore contributes 57 per cent of the group's gross profits.
"We believe North Asia will drive our next stage of growth," she noted. "The recruitment markets in cities such as Shanghai and Tokyo are highly fragmented, which provides compelling opportunities for us to deepen our presence."
HRnetGroup intends to maintain a 50:50 net profit split for its staffing and professional recruitment divisions. "While flexible staffing provides strong recurring cash flows and a stable revenue base, the professional recruitment services division does drive our margins," Ms Sim added.
Besides organic growth, HRnetGroup is also seeking merger and acquisition opportunities to further entrench itself in existing markets or enter new ones.
With relatively low entry barriers, competition is a persistent bugbear, and staying nimble is imperative, Ms Sim noted. "The question is how we organise ourselves to ensure we are faster and better, and a 120-hour work week could be one way to go about it," she said, referring to a comment made by notorious workaholic and tech billionaire Elon Musk.
She said: "We need high standards because we have to set the benchmark, and ultimately, it's the little things that count."
This attention to detail can be seen from HRnetGroup's rule of establishing a presence in Grade A office buildings only. "What's the experience and impression that you give clients and candidates when they meet you? Is it a positive one?"
Discipline is also critical. "Gratitude and positive thinking are important. It's also about the law of attraction - if you keep having negative thoughts, they will ultimately happen," Ms Sim noted.
"Life isn't perfect, but these are some of the values that will help us get through difficult patches, which are bound to happen, no matter who you are or where you work."
• This is an excerpt from Singapore Exchange's Kopi-C: the Company Brew, a regular column featuring C-level executives of SGX-listed companies. Previous editions can be found on SGX's My Gateway website www.sgx.com/mygateway