Robert Walters: From start-up to global brand
Sept. 15, 2015
Although the long-established model of lifetime employment is being chipped away at in Japan, mid-career recruitment is still a relatively new concept. Domestic firms have historically been slow to pick up modern hiring methods such as direct sourcing and social media outreach, and merit-based transfers are still far from the norm. In what could be described as a sluggish labour and recruitment market, one British company is blazing a trail. Launched in the UK 30 years ago, Robert Walters Japan will this year celebrate its 15 year anniversary in Japan.
The firm’s Tokyo office, the second largest after London HQ, currently employs over 25 nationalities, and together with their Osaka office, has become the most profitable business in the group globally. As well as being named the official supplier to the Japan National Rugby Team, in advance of the 2019 Rugby World Cup – the first to be held in Asia - Robert Walters KK is now the first ever foreign sponsor of the National Art Centre in Tokyo in April 2015.
So what’s the secret behind this UK success story?
On September 15, the firm's eponymous founder Robert Walters, was interviewed by BCCJ President David Bickle at a BCCJ lunch event held at the Conrad Tokyo.
Taking the stage as his company celebrates 80% year on year profit before taxation in 2014 and is preparing to celebrate 15 years in the Japan market, Robert says “Doing things the right way creates long-term value for us”.
To a packed room of BCCJ members and guests, Robert firstly explained how he came to enter the recruitment industry in the early 1980s. After initially planning to work as an accountant, he met with recruitment company Michael Page Ltd - then in its infancy - to discuss available placements. There he met CEO Michael Page.
"At the end of it Michael asked 'have you ever thought about doing what we do?' But of course I hadn't, and most people hadn't started to think about what we do as a full-time career. It's become far more common of course but back in 1978 it was very unusual. So it was a chance, a lucky break that got me started.”
Robert soon made an impact as a recruiter and was asked to take on an overseas assignment.
“I started up Michael Page's New York office in 1982. It was a real character building experience. At the time I thought I was really good, but it was a baptism of fire. It was honestly very difficult as a British businessman in New York at that time - very parochial, and I struggled a lot."
When CEO Michael Page retired, Robert decided to start out on his own - taking out a bank loan for GBP500,000 and acting as his own guarantor. “I put my house on the line. And I had a great bank manager at the time. I just had to keep taking him out for lunch to his favourite fish restaurant!
The company grew rapidly. “Within four and half years, we had four offices and 120 people, having opened Brussels, Amsterdam and Thames Valley.”
Robert admitted that with the benefit of hindsight, the company's push for impressive growth could have seemed foolhardy. "I look back and I think, 'what the hell was I thinking?' Yes, it seems reckless."
After initial successes, he was able to secure GBP750,000 in capital just before the recession hit in 1990. "It was very hard in 1990-1993. At one point I was on holiday with my wife and my two-year-old and I had to drive to a carpark on the coast to get a phone signal, to get the latest bad news. We were selling everything that wasn't nailed to the floor. It was nearly all over. If it hadn't been for that finance that I'd gotten on board beforehand, none of this would have happened."
Following the recession, the company began to grow again. Robert explained how the idea of going global was first mooted by his neighbour, Lord Deighton, who at the time was working at Goldman Sachs.
"It really started as a casual conversation. He said, ‘Rob, you already do work for us in New York, Singapore and Hong Kong, but you don't have anything in Tokyo? We're going to grow from 50 people to 1500.’ So I decided to open an office. Which again, you could say was a bit reckless, as there was nothing on paper, but I thought that if Goldman Sachs were expanding so would the other banks."
The Robert Walters Tokyo office is this year celebrating its 15th anniversary and, together with the Osaka branch, is the most successful overseas arm of the Robert Walters operation.
The CEO admitted that start-up costs in Japan had been high compared to the company's other overseas branches. "It was quite expensive and a risky venture. But we grew organically, steadily, year after year. And it's become one of our most profitable businesses with a great mixture of international people.
And he acknowledged that Japan has some distinct challenges for market entrants.
"I think a lot of businesses in our industry do find it a little difficult to shift to an international environment - particularly in Japan. Things are just different here - a little difficult and over-complicated. It has certainly got its own challenges."
The firm's Japan operation now houses over 40 different nationalities. Robert said this cultural mix was intentional. "It's deliberate. I think it's ingrained within the company, to have diverse people from different backgrounds. I don't think we ever thought about it as a policy as such. But we transfer a lot of people internally to offices around the world. This year alone we have transferred 27 people to a different country."
Moving onto branding, Robert confirmed that even with a presence in 24 countries, all offices and procedures conform to the company standards.
"We have the same front office and back office systems all over the world. From the furniture to the uniforms worn by reception staff, the colour of the paper. I'm a person who is focused on attention to detail."
The "old-school" CEO said he was optimistic about the firm's future growth, despite economic uncertainty in Europe and elsewhere.
"The recruitment industry as a whole is growing at quite a fast pace. Nowadays, the demand in China - which is the same as that in Japan, and elsewhere in SE Asia - is for bilingual professionals. It doesn't always matter about GDP or growth rate. For 14 out of the 15 years we have been doing business in Japan the country has technically been in a recession."
The firm has also chosen its markets carefully, for example avoiding countries with a low fee base.
And it differs from most recruitment consultancies - rather than paying commission to individual consultants it has a profit share approach. "The rewards to our consultants are based more on team work. Candidates see the whole client base and clients see the whole candidate base. The only other firm I know of that does this is Michael Page, and I think I'm right in saying we are the two fastest growing in the world, so it must be the right idea."
Robert said he was reluctant to offer general advice to those starting out in their career in recruitment but suggested that focus was always going to be a key component to success. "In my experience of business, from retail through to software, if there's any consistent reason for failure it's being distracted and not keeping focused. I did make this mistake myself. I should have stuck to accounting recruitment but I once took a job as a marketing consultant. It wasn't my skillset, and I should have just said no."
Robert also confided how he once turned down a search for pharmaceutical staff from a large client he was keen to work with, because his businesses needed to stay focused on finance at that time.
In a detailed Q&A, Robert took questions from BCCJ members and guests on various topics:
Talent in Japan and language skills
"We do a lot of work with the JET Programme and people like that because two key issues facing Japan are language and immigration. We can bring people into Japan relatively easily so I don't think the immigration process is a massive hurdle. It's more a case of encouraging foreigners into Japan who can already speak Japanese - like former JETs. It's about promotion of the country as a destination.
"Japan is going to experience a colossal drop in its working age population, but not everyone is ready or able to come here and speak Japanese.
"In terms of the English levels among the general population in Japan - it isn't so high. English is the global language of tech. I know some Japanese companies have installed English as the internal language but it's largely been a disaster because no one can speak it, and people fail to communicate with global teams. If you walk around this wonderful city [Tokyo], and it is a wonderful city, how many average citizens can speak English? It's a real challenge for the country."
Recruitment in the digital age
"I recently learned that Robert Walters is the 25th largest user of LinkedIn in the world. I'm not sure if that's a good or bad thing!
These days, no one has a black book of contacts. Everyone knows everyone. But access is not the point. The point is that people need to know who are the top candidates and have more involved details about them. I've been told 'I have a candidate but I don't know whether his LinkedIn profile is accurate; I don't know that he really wants the job; I don't know his salary expectations. Just put two CVs in front of me, not 2,000 and make sure the people want this job at this salary and at this company'."
Robert said he unconvinced by technology which aimed to automate some of the recruitment process by scanning for key words in resumes. '"The problem is that if you want good people you have to put the time in - it can’t be automated."
How Robert Walters set itself apart as a start-up
"We held seminars and disseminated information and we removed all the fear factor for candidates. We would invite them in and tell them they didn't have to register for anything and that there was no risk their CV would be sent anywhere. And we would do what we would have done had they been registered, and 90% of the time they asked to be registered.
"I also decided not to recruit for the big accounting firms but to headhunt candidates from there. We also headhunted lower level junior positions, as well as senior. And we went international quickly, most people tended to go regional and spread around the UK first."
"Acquiring other businesses can be tricky but the industry tends to be polarized now. There are the large firms and then there are the boutiques - whereas before everyone used to be in the middle. We have eight in-house lawyers to look over agreements and liabilities that lurk within 120 page contracts. Put simply a medium-sized firm isn't able to do that. There are so many hoops to jump through nowadays."
Candidate is king
'When an economy recovers, the candidate is king. It's not about finding a job it's about choosing a job."
The future of Robert Walters in Japan
The CEO remains bullish on Japan. When asked if, ahead of the 2020 Olympics and Paralympics, he envisioned the company working with more and more domestic Japanese companies, or whether he believed the focus would remain on international companies with Japan offices, he said:
“At the moment, it’s around 85% international businesses and 15% very Japanese companies, and some of the Japanese companies are actually run by internationally-minded Japanese. We do have an intention that Japanese companies would become a larger portion of our business, and it's certain that more Japanese companies are looking to internationalise. When we first started out we worked only with international banks, and we were in that bubble for two or three years. Since then, we have spread out. I would say that in five years in Japan, we will be serving about 70% international companies.”
Robert Walters an award winning business HERE
Robert Walters wins Company of the Year at the 2011 British Business Awards HERE