In each character lies a unique talent, and that's what we are at Randstad all about: finding and engaging that unique talent for our clients. Let me start off with a warm welcome to each and every one of you. It's great to see so many shareholders, analysts, and banking relationships here in the room. You know, I'm still a bit new, you could say, but I've already seen quite a few familiar faces and some new faces as well. So great to have you all here. Also, a warm welcome to our online viewers, and a very special welcome to our founder, Frits, and his wife, Petra. I know you are watching. Hi, Frits and Petra, good to have you also here with us. Why are we here today?
We're here today because we actually found some remarkable similarities between Tate and Randstad. First, a legendary founder, Henry Tate, and Frits Goldschmeding, and Frits is a true legend in our industry. We celebrated his ninetieth birthday a couple of months ago. Second, Tate is a global leader in the world of art. Randstad is a global leader in the world of talent. But in 1992, Tate decided to put a major step ahead, and that is to create Tate Modern, to take Tate to the next level. So my team and I are absolutely delighted to have you all here today to discuss an equally important step for Randstad, to take Randstad to the next level. Randstad Modern, you could say. Let me start with the end in mind. At the end of the afternoon, I would like you to take away a couple of things.
First of all, the world of work is changing, and Randstad has set an exciting and new vision for the future that sets the right tone and direction for the company. That vision is to be the world's most equitable and specialized talent company. Second, the combination of the strongest possible foundation, our new strategy, Partner for Talent, of which specialization is a key pillar, combined with an outstanding team, results in a new growth algorithm. These four elements, they reinforce each other, and they will drive higher growth and profit at a scale that only Randstad can do in this industry. Let's say a couple of words about the strongest possible foundation.
When I joined Randstad, and that's not so long ago, it's about a year and a half ago, my first visit was to Randstad in Spain, and they took me to meet a few clients, and I was blown away. I was blown away by the warmth of the relationship, by the value add of the relationship, by the mutuality of the relationships. And then, of course, we met with the teams. Great people, very excited, very passionate about the work they do. And guess what? Our teams deliver. They deliver in sales, they deliver in sourcing, they deliver in delivery, delivering the talent to our clients. Having a team of more than 40,000 people in the field, day in, day out, with clients and talents, is absolutely very powerful.
The best thing about this all is, and that's why it says universal values here on the slide, is that wherever I go, I see Randstad. I don't just see a company, I see Randstad, and that is because of the values that we share in Randstad. A couple of weeks ago, I was in Randstad, in Italy, and you see Randstad Italian style, with a lot of Latin swing in the relationships, how they go about with their clients. When you go to Japan, you see Randstad the Japanese way, with a lot of respect for the clients and a lot of precision in how we make the matches, but it's still Randstad. The other key thing on the slide is here, is our DNA, and first of all, that's our adaptability. Adaptability is absolutely a critical thing to have in your DNA.
It works on the way up, and as you have seen last week from our results, it also works in more challenging times. Then we have scale, and scale matters in our industry because scale means capability and profitability. And if you have scale, you also have the capacity to invest in growing the business. If you take those two universal values and DNA, you get happy clients, happy talents, happy employees, and you get financial results. And over the past years, we have delivered financial results. We've grown the company, we have grown our profit, our cash flow has been remarkably stable, and we have had industry-leading TSR over the past decade. So we have the strongest possible foundation in this industry that anyone, that anyone could have. Let's talk a little bit about the world of work.
The world of work is changing rapidly, and you see three big trends on the slide here. We call them the Big Three in Randstad, and the number one there is talent scarcity. And talent scarcity is driven by aging population, meaning it's not going to go away anytime soon. Talent is more powerful than ever, and therefore they're more demanding than ever. Talent is not just looking for a job and a payslip. No, they're looking to learn and grow, they wanna make a career, they wanna work for companies with a purpose, they're looking for belonging. And last but not least, as you probably all know, because you're amongst the talents, they're looking to work in a flexible way. So employers and Randstad really need to step it up on how they engage with talent. So guess what?
If talent is scarce, it's also higher on the list of our clients. So talent and the talent agenda at the company is now very much a C-level issue, the CEO, the business leaders, and of course, the CHRO. So clients are looking for more support from people like us. Clients are looking for support in their talent strategy, in their workforce planning, in their employer branding, in getting the people on board, in deciding whether that's gonna be on a permanent basis, on a temporary basis, or on an outsourced basis. Clients are looking for help in skilling, clients are looking for help in coaching, and they're looking for help in transitioning careers. So a much broader set of services is what clients are looking for these days.
Last but not least, the third one of the Big Three , data, digital, AI, cloud, all the digital technologies that are transforming the world. It's really in the combination of these technologies where the opportunity lies. Opportunities to engage better and deeper with talent and clients, opportunities to help our consultants to do a better job for their talents and clients, and opportunities to have seamless processes throughout our organization. Opportunities in the round, I would, I would say. A couple of months after my visit to Spain, I had my first day in the job as the CEO of Randstad, and we had a room like this, few more people, about 100, the top 100 leaders of the company in the room. We said, "What are we gonna do with the company?
What are the next steps that we're gonna take?" So we kicked off a project, we called it Polaris, North Star, to decide what it is that we were going to do with the company. We had 10 teams working, ranging from mission and vision and the IT systems we need, and everything in between. And after a couple of months, 3, 4 months, we came together, and we drew two very important conclusions. First, the Big Three play in our favor. We've been dealing with clients for 63 years, we've been dealing with talents for 63 years, and we have a lot of good stuff in terms of digital technologies, where we engage with our clients and talents. At the same time, we concluded it is time, once again, to raise our game.
We need to be making that big step that I was just talking about, to move on from a generalist staffing company, to be the world's most equitable and specialized talent company. Let that sink in for a minute. The world's most equitable and specialized talent company. Three big words here. The first one, obviously, talent. Talent is scarce, talent is what we are helping our clients with, so everything we do needs to be about talent. Second keyword, equitable, and this is really very simple. If talent is scarce, we need everybody on the pitch to do the work. If we want to find the best people for our clients, we need to look in all pools of talent and not just in one. And we need to level the playing field.
We need to ensure a fair and equitable treatment for talent throughout the process, so that they get in the best possible shape at the starting line of our clients. And this is not window dressing, we're very serious about it, because I always say to my teams, "It's not to be nice people, this is a business imperative for us at Randstad." Third, specialization. Clients are looking for specialized skills, not just people. So the better we know what our clients are looking for in terms of specializations, the better we will be able to find, engage, and retain talent with them. So specialization is really very important. So you might say, "Sander, that sounds all very interesting, but how are you going to make this happen at Randstad?" And that's why we are launching our new strategy today, and it...
We are saying Randstad will be a Partner for Talent . A Partner for Tal ent. And again, that sounds simple, but behind Partner for Talent , there are quite some mighty promises, I would say. We will partner with our clients, be they large global enterprises, local champions, or SMEs, we will truly know what makes them tick, so to speak, what their business is about, what the skills are that they need, what their culture is, to make sure we find the best possible talent with the right match for them. And we will be a Partner for Talent . And this is about not just finding talent a job, no, this is about helping them in their career. This is about training, skilling, this is about coaching, and it's about building a deep relationship with talent.
Because in Randstad, we are a people's business, so at the end of the day, it's all about relationships, relationships with clients, and relationships with talents. We're gonna do all that, as you can see on the slide, along the lines of four specializations. Let me first say a couple of words by what we mean by specializations. Because specializations, we will run our specializations as a business. Each of them will have its own strategy and its own growth focus. Because specialization is not only about skills, it's also about sourcing the business models, how we sell, how we deliver, dedicated teams, and how you make a career in Randstad. Specializations will be pervasive in our organization. We will have four main specializations. I'll mention them briefly here, because Dominique will later go in a bit more detail.
Randstad Operational Talent Solutions, which is the talent that our clients need to keep their business running in the plant, in the warehouse, in the store, at the airport. Randstad Professional is the HR professionals, legal, finance, but also doctors, nurses, teachers. Randstad Digital Talent Solutions is all about the hot skills for digital transformation, cloud, AI, user experience, product and software engineering. And our last specialization is Randstad Enterprise Talent Solutions, and these are end-to-end talent solutions for our larger clients, our enterprise clients, as well as our local champions. So four specializations. So what is distinct about this? Two words: focus and scale. We will focus on these specializations, we will focus our teams on these specializations, and we will do that at scale. Because at Randstad, we are big, we need to do everything at scale.
So it's an integrated strategy, and that's why we will do everything, as you can see on the slide, under one Randstad brand, because we believe in the power of collaboration. We're gonna be a house of specialists, collaborating to bring the best of Randstad to our clients. And we will grow and invest in all four of the specializations. And as I always say to my teams, we have four specialization, and I love them all equally. Our portfolio will evolve depending on the growth that those various markets offer and the investments that we will make. Maybe we talk a little bit more about how we're gonna do this all in detail. What is our strategy to make that all happen in? And you may have seen it already in the press release. Five elements of the strategy.
Growth through specialization. We talked about specialization, let's now talk about growth. If there's one thing that I have learned in my 35-year career in professional service, it's that focus works. Focus works because if you wake up in the morning, and you say to each other, "We are gonna be the best team in Operational Talent Solution in France," you will be on it. You will know your clients better, you will know your talents better, you will deliver better, you will price better, you will run your business better. Focus works, period, end of story. That's one important source of growth. Second important source is we target the specializations each on high-growth segments. Again, Dominique will talk more about it later. Third source of growth is we will expand our services portfolio to be truly end-to-end, ranging from workforce advisory to career transitions and everything in between.
Second key pillar of the strategy is talent and equity at the heart of everything we do. This is about sourcing, it's providing the talent with the best experiences, it's about learning, and of course, it's about the best we can be at equity. We will raise our game on developing even more personalized relationships with talent. Third key pillar is delivery excellence. So why delivery excellence? Guess what? Clients buy from Randstad because we deliver. I always say, delivery is the best marketing of Randstad. If you deliver, clients will be open to do more business with you. Very simple. Simple concept, more difficult to do. This is about meeting our clients and talents where they are, omni-channel, and it's about talent and delivery centers to drive also specialization in the delivery. And Jesús, our Chief Talent and Client Officer, will talk more about that this afternoon...
Fifth, fourth pillar of the strategy, the Randstad Talent Platform. The Randstad Talent Platform is the collection of digital assets that we use to engage deeper and better with our talents and clients, that we use to help our consultants do a better job for their talents and clients, and to have seamless processes throughout the organization. The Randstad Talent Platform will also enable us to innovate faster at scale, and to be more cost-effective when it comes to using technology in Randstad. Last but not least, the fifth pillar in our strategy is the best team in the industry. Because we're a people's business, we need to have the best team on board. I think we are already the best team. Why? Because we can attract great talent in the market. We have that purpose, that sense of purpose.
You know, we find jobs for people, doesn't get a whole lot better than that, and we have a great employee value proposition. But we need to keep working at it. So later this afternoon, we have Martin on the Randstad Talent Platform, and Myriam, our CHRO, on the best team in the industry. And all of this is underpinned by an investment agenda, because I'm a strong believer that if you have the right strategy, you need to invest in the business to accelerate growth. So we will continue to invest in organic growth, as we have always done, adding teams where we see opportunity. We will invest in the Randstad Talent Platform. That will help us sell more, but also help us deliver better, engage better, and we will continue to do acquisitions like you have seen us do in the recent past.
We bought Finite in Australia for Randstad Digital, and we bought Grupo CTC for Randstad Operational in Spain, focusing on outsourcing in the operational environment. Investment in the business is a key plank of our strategy as well. So what's the so what here? The so what is value creation. Because everything we do here is geared towards deepening the relationships with clients and talent, and the deeper those relationships are, the more durable and resilient our business will be, resulting in a good quality of revenue. Growth through specialization will drive higher growth. Talent and equity at heart will create more and better talent and more talent loyalty. Delivery excellence will drive up win rate, will drive up talent and client satisfaction, and will drive up productivity. The Randstad Talent Platform will allow us to innovate and create economies of scale.
Yeah, and the best team will help on all of that, of course. And again, this is underpinned by our DNA that I already mentioned in the beginning: adaptability, scale, and investment capacity. And all of this will drive a new growth algorithm that will drive higher growth and higher profit at the scale that only Randstad can do in this industry. Which brings me to the folks that you're gonna see this afternoon. We have an outstanding leadership team. It's a good combination of deep, deep, deep, deep Randstad expertise and experience, and some outside experience that we really didn't have in Randstad, before. And I can tell you one thing, I would not swap with any CEO in this industry, because this is truly the best team.
These folks, they have the passion, they have the commitment, they have the energy, they have the experience, they have the knowledge, and last but not least, the wherewithal to execute our strategy and deliver results at the same time. You will see all of them on the slide here in action, except Chris. There's a last wave of COVID that came through the Netherlands. So Chris, we wish you all the best. I know you're watching, so we're gonna miss Chris this afternoon. And meet, our Myriam, you can raise your hands, our CMO, she just joined Randstad a few months ago, so we gave her a pass on this one. Next time, she'll be on the stage as well.
So in summary, the world of work is changing, and we have set an exciting and new vision for Randstad that sets the right tone and direction for the company: to be the world's most equitable and specialized talent company. And the combination of the strongest possible foundation, our strategy, the right strategy, Partner for Talent, of which specialization is a key pillar, and an outstanding team, will result in a new growth algorithm that will drive higher growth and profit at the scale that only Randstad can do in this industry. With that, let's roll the video.
The way we work is changing. Change driven by digitization and technological innovations, by the rapidly growing imbalance between in-demand jobs and available talent, and by a wide variety of work expectations and needs. Talent look for more than a job, more than a monthly paycheck. They want meaningful work, opportunities to develop, more flexibility, and a sense of belonging. Talent scarcity requires companies to run their workforces in a highly agile way. Finding, attracting, and retaining the right people takes much more effort. That's why, for both talent and clients, we are a partner, a Partner for Talent . We support talent as they navigate their working lives every step of the way, create equal opportunities for all, and when needed, give someone that little extra help to keep them moving forward.
For clients, being a Partner for Talent means we help define and execute end-to-end workforce needs to power their business at speed and at scale. Our operational specialization offers talent solutions that keep a business growing and moving. Our Professional specialization provides talent solutions that establish an organization's core and vision. Our Digital specialization brings talent solutions that drive tech forward. Our Enterprise specialization creates sustainable business value through global talent advisory, acquisition, development, and transition services. These four specializations support businesses and people as they grow, every day, everywhere, to reach their full potential. Randstad, Partner for Talent .
So the agenda for this afternoon will be, the first section that we will go to next is, of course, growth through specialization. Then we will have a quick break, then we will look at talent and client delivery, the Randstad Talent Platform and Best Team, and then last but not least, I would say Jorge, our CFO, with the new growth algorithm. Let me now introduce Dominique to the stage. Dominique is our head of Northern Europe, and she will introduce the next section.
Thank you, Sander. Also from my side, of course, a very warm welcome here in London, and also for all of you who are watching us online. I'm Dominique Hermans. I'm responsible for group strategy, and I'm one of the four regional chief executives of Randstad. Started already 20 years ago with Randstad, and still very excited to work here. Meanwhile, I had the opportunity to do different roles, to work in different roles, but my passion still is here because I know how important it is, and our work brings a lot of importance to clients and to talents. And we also have a strong performance angle, and that combination really suits me very well. Being in the business every single day, we know how important growth is, and I will explain you why and how specialization supports this growth.
We specialize because we really want to develop a stronger competitive advantage, as we already have today. Being specialized ensures our talents and our clients to get the focused support they are looking for in a world where they are already expecting more from us, or a better service from us than they already have today. We have decided on those four specializations that Sander was already talking about, of course. We have Randstad Operational Talent Solutions, Professional, Digital, and Enterprise Talent Solutions. Primarily, we look from the angle of the profiles because we know that we can offer those profiles not just a job, but we can offer them a first job, we can offer them a second job, a career.
And we can also help them with skilling, with coaching, so that they can really develop themselves into their role, so that they can become better from low to high skilled or higher skilled. And we will also continuously engage with them through the Randstad Talent Platform, and by doing that, we add value to the talent, but therefore, also add value to the client. Let's have then a more in-depth look into every of those specializations. First of all, the Randstad Operational one. Like Sander already said, that's all you need as a company to attract and also to manage your operational workforce, so you can think of the factory, the production, the warehouse of a company. Today, almost EUR 20 billion of our current revenue is already in this space.
We have strong market leader positions in many of the countries, but still, we see some segments of growth, some growth opportunity. In common, in the 10 biggest markets, we see that there is an opportunity to grow further in this specialization in skilled trade and engineering and in logistics. And to put a bit of data, as a proof point, in skilled trade and engineering only, we have today already 66 million jobs or FTE, and we expect a growth of 8% towards 2030. And that is, of course, mainly due to the energy transition. The second one is Randstad Professional Talent Solutions, and that's all profiles in the field of office and admin, HR, finance, healthcare, education. So think of headquarters or shared service centers, educational institutes, hospitals.
Here we have EUR 4 billion of our current revenue, and compared to the market size, still a big opportunity to grow. The market position of Professional in different countries varies a lot, so we don't have only opportunity in many of these segments, but also in many of the geographies. We think that the most promising, if you look again at the top 10 countries, are healthcare and finance. You can see on the slide, in healthcare, we expect 20% of growth in amount of jobs, and in finance, 13%. So I would say lots of evidence that investing and further specializing in those segments is worthwhile. Then the third one, and the third one is digital.
Digital transformation really is a hot topic in almost every company, in every sector, and those companies are then looking for a trusted partner to help translating the digital transformation strategy into execution by doing or delivering a right mix of solutions, global capacity, and staffing models. That's exactly what we are at Randstad Digital. But I don't want to steal the thunder of my colleague, Venu, who will shortly explain a bit more in detail what it is all about. The fourth one here is Randstad Enterprise Solutions. And Enterprise, they will act like the orchestrator for our big clients across the organization. And besides being the orchestrator, they also deliver services themselves, like managed service provider, recruitment process outsourcing, talent advisory, career transition, outplacement, and coaching.
The biggest growth in those services is definitely with those big clients, but the services are also available for our SME markets. Within this specialization, we will further specialize into life sciences, because we see a growth coming of 6% of amount of jobs towards 2030, but there is also big demand for RPO and MSP. Mike, other colleague, who will be on stage shortly, will then explain to you how that precisely works in depth. The four specializations together work as one Randstad to deliver the end-to-end talent solutions Sander was also referring to. To be able to deliver those end-to-end talent solutions, we have broadened our services further. We have added workforce advisory, skilling, coaching, and career transition. Those are sizable markets, so also within the segments, a big opportunity to grow.
Every single manager within Randstad is focused on driving performance, and that actually means that we want to grow in a profitable way and also faster than the competition. But there is also focus on executing the strategy, so implementing the five pillars that you heard before. Maybe the most important of all are all our employees, because they have daily contact with talents and with clients, so they can be the true specialists in the industry. They can be that by leveraging, for example, the talent and client delivery models we're putting forward now, but also by using the Randstad Talent Platform to be supported, to, for example, redeploy their talent faster and better, and also to permanently be in contact and engage with those talents. And that's what Jesús will explain later today, and he will explain why the talent and client delivery is a real differentiator.
Let me summarize my part, or this part. The four specializations will drive the growth in the coming years through, among others, the six segments I was just explaining. In those specializations, specialized sourcing and customized delivery will really develop that stronger competitive advantage I was talking about. And our employees will be supported to become even better than they are today, so that they can be the true Partner for Talent . Now, there will be a panel discussion. Before Mike and Venu will explain a bit more about Enterprise and Digital, the four regional chief executives will come on stage and discuss, and be more than happy to share our thoughts on the regions, and also some great examples on specialization. Sander, I would like you to host the discussion, if you wish.
Absolutely.
Please.
More, more than happy to, as you can imagine, Dominique. Thank you very much for that introduction. Let's ask, Herman and Kajetan to come to the stage. And Herman and Kajetan-
Just-
A re leading our two biggest regions in terms of growth profit, and in terms of geographic span, so to speak. Southern Europe, Latin America-
U.K.
U.K.-
India
A nd APAC. Herman, let's start with you. You're the biggest one. Tell us more about, you know, the biggest markets in your region and how they are doing.
Yes, with lots of pleasure, Sander. Also on my behalf, a very warm welcome to everyone here in the room, but also the people who are watching online. First of all, about myself, I'm indeed managing Southern Europe, but what you should know, and what's most important, is that I've been within the company for about 35 years. So talking about an employee value proposition, I mean, Sander, that was really, for me, the most important one, to be in a company that puts people to work. I did that together with my unit colleague. 35 years ago, I started, and I had 60 talents working for me, and now, with all of my unit colleagues in these 13 countries in Southern Europe, we have about 260,000 people working for us.
I mean, someone has called it the best job in the world. It is indeed the best job of the world, and I'm still proud of doing that each day again. Coming back to your question, Sander, let's zoom in on the three largest countries in my region. First, we have France. France, we are number 3 in the market, but we are the most profitable one, and we have invested in Professional segment, and I have a nice example of that one. Healthcare, for instance, they have doubled their revenue in about 4 years' time. Then, we have Italy. In Italy, we have a very experienced team, and that team has built actually on an autonomous, organic growth base, an end-to-end service portfolio. They are runner-up in the market, and the challenge will be to be the leader. And then last but not least, we have Spain.
In Spain, we are number one, and we are number one in all segments of the market. So not only within Professional, within Operational, also in Digital and in Enterprise. So I think if you look at what we then acquired last week with CTC, you were mentioning it, Sander, we are not only a market leader in all segments, but also in the segment of outsourcing Operational business, so in that sense, a real market leader.
Herman, something that you said that really intrigued me: impressive growth in healthcare. If I hear impressive and growth, and then any industry is okay for me, but then I wanna know more.
Yeah, and it's indeed a very nice example of what specialization can do for the future of our company. Because if you look at healthcare in France, we doubled revenue, as I said, within four years' time. How did we do that? Well, first of all, we had dedicated resources, units, and branches who specialized in the healthcare business. Secondly, at this moment, we have 500 consultants who are expert in that healthcare company and who know what they're talking about with companies, but also with the talents. And thirdly, we have a digital marketplace where we can connect the talent and also the companies, which are mostly hospitals and pharmacies.
So by combining that and by letting them choose between the human-forward touch, but also between the fully 100% digital way of working, they can really choose their interaction with us, and that have made us market leader by far in that segment. So I'm quite proud of that.
I mean, it's just... It's a great story. I was there in Paris the other day, and they showed it to me. It's really-
Yeah
It's really impressive. Herman, I know also in your region, I mean, you're leading the way on skilling in-
Mm-hmm
I n quite a few of your countries. Maybe say a few words about that, because skilling obviously is increasingly a part of what we do with our clients and with our talents.
Yeah, indeed, because you were mentioning it, Dominique was mentioning it, scarcity is part of our labor market, and it is here to stay. So that also means that we have to solve it one way or another if we want to play a role in society. So what we do is we have a digital learning platform. I can name the example of Spain, for instance, where we have a digital platform where people can learn. I think we have about 450 learning modules, where people can train themselves to upskill their talent.
In Italy, for instance, we have a real in-school training, sort of campus, where we also have co-working rooms, where there's a vibrant atmosphere, because you can really feel, make it tangible, that people can upskill themselves to also build a career for the future. So in that sense, very proud of those two initiatives.
Yeah, and, again, I was in Italy. I was in the box, as they call it.
Mm-hmm.
40 women learning coding. I loved it. It's really a great story. Kajetan, let's move to you. APAC, big, dynamic. Tell us all about it.
Sure. Thank you, Sander. Very well, a warm welcome to all joining this meeting. A quick word of introduction, Kajetan Slonina, in the talent services industry since 1999, with Randstad from 2008. I'm very proud how Randstad in APAC has built a winning team, which is a solid foundation for profitable growth. We have shown a fantastic growth capability, with 129% in the last 10 years and improvement of profitability by incredible 1,066%.
Woo-hoo!
In this period. Thank you. So now, let me deep dive into main markets in the region: Japan, Australia, and India. In Japan, we have the oldest working population in the world, in parallel with very low birth rate. That creates a growth opportunity, which we used, and had solid organic growth with very good margins. We are providing 33,000 talent weekly to our clients. Dominique mentioned that there will be a growth of engineering jobs globally, and this is also a key opportunity for us in Japan. We are already partnering with leading Japanese companies such as Hitachi or Fujitsu, ensuring that they get the engineers that they need.
It's a very scarce market from the talent perspective, and we are focusing on helping our clients to retain the talent. We engaged with more than 44,000 talents to date, with in recognition events, which has proved to be to increase talent retention, but also client satisfaction, and this is a win-win. Now, moving to Australia, I'm very proud of how we increase our market penetration there from number 6 to number 4 by offering total talent solutions and by focusing on locally relevant specializations. Australia is facing a multitude of challenges in the healthcare space, and one of them is a predicted shortfall of nurses by 2030, with about 120,000 nurses missing.
We are focusing on that segment, and we are already partnering with top—with 7 out of top 10 aged care providers, helping them to source critically needed nurses. We believe that there is a huge growth opportunity for us, and this is what we aim to do. We aim to gain market share there. And, similarly, we see a shortage of teachers in Australia, and we built our own digital marketplace, which is putting clients and talent together to fill their available vacancies. Now, moving to India, we have experienced high growth there over the recent years, focusing on financial and engineering segments.
Global capacity centers in India are employing well over 1 million skilled talent, and there, that segment grows by 17% year-on-year. We are very proud of working with top 5 engineering companies, staffing their global capacity centers with trained engineers. These individuals, they work in automotive, construction, and energy sectors, and it is another growth opportunity for us.
Kajetan, I heard you say something about education in Australia, digital marketplace, growth, you know. There's a theme here, by the way, ladies and gentlemen. Maybe tell us a bit more about that.
Sure. So, education is our key specialization, and everyone who is using our platform there is finding value in it. So for our clients, the benefit is that they can place a role anytime and anywhere. And imagine a situation when a teacher calls in sick in the morning, then placing their role, the vacancy on our platform, ensures that the class can go on. For talent, they find value in self-scheduling their shifts and also taking the roles that are suitable for them. We have around 8,000 people already registered and working with us, and we are planning 20,000 shifts every week. And doing this, we know that we do something that really resonates. And let's see more on the video.
In Australia, in the education sector, there was an absolute demand for something that was quick and easy for both educators and teachers, as well as clients or childcare centers and schools to use.
It is a true 24-hour, 7-day-a-week business. If there's not a teacher or educator in front of a classroom, it causes havoc. We have a digital marketplace, and it's a really unique product that has gone extremely well here in the education market.
It's essentially a platform where both clients and candidates can give their preferences and requests for staff, and on the candidate side, where they can pick up the work that they are looking for. They can basically work when they want and where they want, and it's all as simple as touching their phone and, and reaching out to the platform.
The impact that digital marketplace has had is we've had more engaged talent working for us. Over the last two years, we've actually tripled the amount of teachers and educators working with us, and that number is growing. It's growing because the candidates are in control. We're not ringing them with one shift. They have a variety of shifts they can self-allocate them to, which means they're staying working for Randstad much longer. We've been able to put consultants in what we call a work-life partner role, where they're actually able to call the candidates on a weekly basis, ask them how their week was, and not just seen as a number, but they're seen as a greater team member, helping the good for society to be educated.
Thank you, Herman and Kajetan. It's, I mean, good to see that our both our two biggest geos, in different ways, are in good hands. Let me welcome Marc-Etienne, who's leading our North America business, and of course, welcome back, Dominique. Marc-Etienne, let me, let me start with you. I mean, you're just coming into the role, drinking from the fire hose, so you're not new, of course, in North America, no. But, you know, what's going on? What's up?
Yeah. Yeah, I'm not new, definitely, so nice to meet everyone. I have... my name is Marc-Etienne Julien. A quick word of introduction: like Dominique, I started in the business 22 years ago, and also, like Herman, I started as a staffing consultant. He had 60 talent working. I started at a lower base. I had 16. Today, the North American region is a team of 75,000 people. So, Herman, keep, keep an eye on your performance. The North American leadership team is very competitive, and we have our eyes on becoming the largest region for Randstad over time. Couple of words, maybe, Sander. We talk a lot about specialization and how that translate to the North American market. The North American market is a highly fragmented market.
It's also a profitable market, and our specialty framework has been in the works for quite some time already with great great improvement. On the Operational Talent Solution side of things, we focus on four sub-specializations: skilled trade, engineering, industrial management, and light industrial. In those four sub-specialties, we are tailoring the way that we work, the way that we go to market. We've identified key growth area in specific industries, like high-tech manufacturing, food, and also green energy. And it really empowers our internal people to become real subject matter experts. So they can ramp up faster, they can also drive higher productivity, but more importantly, they can really tailor the working experiences that our talent and our customers have. So that really helps us gain ground quite a bit of momentum in the market.
On the Randstad Professional Talent Solutions side, we also focus on four key segments: finance, operational accounting, health, life science, and of course, office and administration, which is an important one. So in Professional also, we've tailored our ways of working to those four specialties and focus on key segment like the finance industry and of course, the life science industry with pharma and biotech. That's showing good, accretive performance to our overall, portfolio. So we have a strong Fortune 500, customer footprint that Mike is gonna talk about a little bit later on, for which, we can grow from. And so far, early observation, Sander, is that, of course, we have some headwind currently in the marketplace.
Our customer are giving us a little bit less volume than what we like to see at the moment, but the good news is that we're still gaining additional customers in the North American market. We have a strong leadership team, a smart plan, and we're on the case to make sure that we show positive growth and great momentum.
Sounds like you're on it. That's good, that's good to see. U.S. is the land of tech, or North America-
It is
I s the land of tech. I live there too, so I know it. But it's also the land of tech in Randstad. So tell us how you're also leading the way on the technology side and not just on the specialization?
Absolutely. So we're an early adopter of emerging technology, and we've been for years focused on user experience in the North American market. And when I say user, I mean all users, our talent, our customers, our internal employees. So with the Randstad Digital platform, we've expanded that two-sided marketplace where we can really impact user experience. And we know that in today's world, a strong digital experience is conditional to satisfaction and sustainable relationship. So the platform is a two-sided marketplace where customers and talent can meet in a digital fashion, and it runs 24/7. For a customer, it means that they can log on the web portal or the mobile app, they can sign up a new shift that they have to fill, tailor the requirements, be matched with local candidates that fit those requirements, and also manage all of their administration from the platform.
It ensures full transparency to the process, better fill rates, and also the ability to manage deployment and absenteeism, should there be any. On the talent side, our talent can use the web, the mobile app for them to create a profile, search for job in their surrounding, self-deploy themselves, and of course, manage their availability. So we're really putting the full power of Randstad at their fingertips and putting them in the full control of their journey. And of course, for our internal employees, it has a lot of benefits. It really helps our internal staff focus on added value task, such as business development or career coaching, time that they can spend with their talent. They have full, transparent view on all of our digital transactions, and we're really deployed right now in 2 states and 15 RIS locations.
Showing great signs of improvement in terms of talent utilization, fill rate, and of course, time for delivery.
Fantastic. For those of you who don't know the acronym RIS, that's Randstad Inhouse, those are our largest clients, where we have lots of talent working. Let's move on to Dominique. Dominique, you know, we talked a lot about specialization, and you were giving a great exposé about it, but how are you all doing it in your region, in Northern Europe?
I will give a glance of it. Northern European region, by the way, is 13 countries. It starts with Norway and goes all along the side to Romania. We have, like, big and small countries, but we have a strong market leader position. We are market leader in Belgium, Germany, the Netherlands, and in Poland, but we're all over the place, very strong in operational. So Randstad Operational Talent Solutions is our biggest business. It's 80% of the business, so 120,000 people work every day in this area for us. And we still see growth opportunities like we all do.
For the Northern European region, that is mainly the energy transition and logistics, so we will further invest there and also make sure that we adapt the client or the talent centers and the client delivery, as we have spoken in our strategy about. For professionals, we see that in different markets we have different realities, so also a lot of segments where we still can grow. We will further invest there in finance. We will also invest in healthcare, and life sciences is also important for this region. And what we will do there is make sure that we can really facilitate the careers for talents. I'm very convinced of that growth because we already have some very nice examples in it.
In the Netherlands, we work for the three biggest banks, and for those banks, we managed in the last couple of years to place 3,000 people. 450 out of that immediately started in a career path. That means when they started it, the end goal was very clear. You're not just offered a temporary job, but we are taking you alongside in your career to develop yourself into those roles in the banks. And the good news is that 30% of them already did it so far. So it's really working as a true partner for those talents. We are helping them with their career path, which is, of course, nice. And equally important, another example is, of course, that we work together with those four specializations.
Nice example there is a big life sciences client in Belgium, where we place, for example, operational staff in their factory, but also financials and R&D engineers in their R&D department. It's logical that it offers a lot of added value for the client if we work with a strong, engaged team alongside the different specializations, but it's also adding a lot of added value for the talent, because we have many examples there where someone started as a junior financial in the factory and then, well, became a more specialized financial in the R&D department, to say something. We also put people into an outplacement process if needed, so you really see that that working together is paying off.
So I would say and summarize for the Northern European region: further specialize and invest, invest in the business, but also in those models, in our strategy, and work together very well, and that's the game plan for the next coming years.
Right. Collaborating to bring the best of Randstad while helping the talent along.
Yeah, that's what it is.
I think it's a great, it's a great story. Dominique, to wrap up the panel, I mean, you've been around Randstad much, much longer than I have been. What would you say is the secret sauce of Randstad?
I think the answer lies in the past and in the future. We have a very strong and successful foundation. We know what we are talking about. We also see the importance of our work to talents and to clients, and we also know how to run this business in a profitable way. If you look back more than 60 years ago, when we were founded, we did it in a very traditional way. It was almost with a paper and a pencil. Today, we have a very specialized portfolio. We have multi-channels to reach us, but still, we are working with a very entrepreneurial spirit. We really want to get things done. Our values, as said, are still the same as Frits taught us more than 60 years ago: to know, to serve, to trust.
On the basis of those values, we really deliver excellent service with trust and equity in everything we do. I'm also convinced that we're not at the end of that evolution. We know where the growth is, how to catch that. We have a strategy. We can execute on that, but we will still also, in the next decades, work, yeah, with the same values in mind, the same passion, and the same entrepreneurial spirit.
Right.
I think the best ingredients to lead the industry, I think.
Now, Dominique, I'm so happy that you brought it up, because ultimately, in the people's business, it's the cultures and the values and how we collaborate that set us apart in the eyes of the client. And that is really something that's very strong at Randstad, that you all should take home. But let's maybe hear what our clients say about how they experience Randstad.
In the automotive industry, the projects are becoming more and more complex with a lot of software content. You need specific competencies, knowledge that we are not used to having, and that could come from non-automotive fields.
Coming out of the pandemic, the demand for travel was extremely high, and we basically had to rebuild. We couldn't meet up quickly enough with the demand, so Randstad truly was a key partner in helping us.
We need also, multiple competencies in different locations to coordinate and to work together. Here, the footprint of Randstad in many countries is allowing us to have access to these talent pools, where we are not always necessarily fully located, and we do not have direct access to these talent pools.
The experience with Randstad in finding the talent we need and will need as a company can be defined in one word: excellent.
They really took the time to come to headquarters, spend time with our leaders, spend time with our frontline employees to truly understand the day-to-day. There was never a no. It was always about finding creative ways of getting things done, and I think what's critical here was we're never compromising the quality of the candidate.
We have a strategic partner aligned with our culture, competing as a team to win and seeking excellence.
If you are only in a relationship of I buy your service, you are not engaging in this long-term view. That's why this partnership mindset is of critical importance from our point of view.
They always came back to us with solutions, and that was really critical for us. It was always, "Let's see what we can do and how we can get there together." That's why Randstad, for us, is a true business partner.
So let's move on to Randstad Digital. When we were talking about Randstad Digital and launching that in the market, we said, "We need an industry veteran to come and lead this for us." So that's why I was very happy to find Venu, who joined us from... after a long career in IBM and a bunch of Indian companies. So, Venu, please join us on the stage here to talk about Randstad Digital.
All right. Thank you, Sander. Good afternoon, everyone, and welcome. You know, I'm new to Randstad. I joined Randstad at the beginning of this year. As Sander mentioned, I spent almost three decades in the IT services and consulting industry. You know, so I started way back with IBM and as part of the Cognizant's executive leadership team. So when Sander discussed, you know, this role, almost at the same time last year, I was, you know, intrigued, because I could not relate what technology business with Randstad. But as I learned through the discussion, and most importantly, what I discovered after I joined, literally blew me away.
You know, we are talking about the business, which is close to EUR 2.6 billion in revenue, you know, with a billable talent of 20,000+, almost close to 25,000 billable talent all across the world. And most importantly, servicing 300 of the Fortune 500 customers and delivering a great mix of solutions business and a good mix of talent augmentation business. You know, if this was a standalone in a competitive perspective, you know, with, with the billable headcount of 20,000+ and with the size of revenues and the kind of projects we do, I would actually say, you know, this business could give a good run for money for any of the top 20 IT companies in the world. So it's a great foundation that was there, right?
That's that really excited me, you know, to take up this role. Over the last 10 months I've been here, I and my team have focused to deliver three things. The first is we integrated all the tech business of Randstad, you know, from different parts of the world, under one global organization, under one unified brand of Randstad Digital. Incidentally, we launched that on thirtieth of August, and we got a great response from clients, analysts, partners, and the whole ecosystem of talent. The second thing we did was, you know, if the business is gonna focus on digital, you know, then we need to define the areas we will double down in terms of skill sets, double down in terms of focus area.
We said, we'll focus on four things when it comes to the specialization within the digital landscape. The first is about experience, with customer experience, because all the dollars are going in enhancing the client experience. The data and GenAI capabilities, you know, the future dollars will be spent on that specialization. The third card is cloud, which is the biggest catalyst for any tech modernization, and the fourth is the software engineering and the product engineering. We said we'll focus on these four things, and I'll talk more about how do we intend to do that as part of the strategy, you know, in the subsequent slides.
The third thing that we did was, which I believe is gonna be a very strategic pivot and will essentially redefine the business model, is we already had 400 of a very talented engineers working in the automotive, aerospace from our Romania center. We enhanced that capability by opening up a few more, you know, global centers, primarily 2 of them in India, in Bangalore and Hyderabad. And then, of course, we have in Quebec, and, you know, during the course of the next year, we'll also open a few things in Latin and so on. The aspiration is 40% of our billable talent over the next 3 years should work from any of these talent centers.
So that actually gives us a strategic advantage of developing skill sets, solutions, and capabilities through a centralized location, and obviously, it's a great opportunity for the value creation because of the cost and the revenue profile that you get. So these are the three things that we did. So before I talk about where the opportunity lies and how do we intend to manage it, you know, let me take a minute of yours to present you the Randstad Digital introduction video.
Digital transformation is unstoppable. It's evolving at a rapid pace. Advancements in generative AI, automation, and data science are impacting every aspect of our lives. From cloud engineers and data architects to CX specialists and cybersecurity analysts, the world of tomorrow is taking shape before us. Digital transformation hinges on having access to the right tech talent. They represent the most critical strategic component in driving change. How do you unlock your organization's full potential? With a partner that is uniquely positioned to enable you across the digital transformation value chain. We are Randstad Digital, your digital enablement partner. We accelerate transformation at scale. We stand as a global enablement partner. With managed solutions across specialized domains such as digital and product engineering, customer experience, data and analytics, generative AI and cloud solutions.
Embracing a talent-first philosophy, we support tech experts throughout their working lives and ensure they develop the skills they need to be at the forefront of innovation. Through our diverse network of tech talent, we seamlessly connect organizations to highly skilled professionals whenever and wherever you need them. Take advantage of our talent services to augment your current workforce with the right tech experts. Harness the reach of our global talent centers to rapidly scale your operations and access specialized skills. Leverage our subject matter experts to deliver industry-relevant managed solutions. With Randstad Digital, we are introducing a new category: digital enablement partner. We are charting a course for organizations to be future-ready and setting the standards for true digital transformation empowerment.
You know, thank you for watching. It's really exciting times, you know, for us at Randstad Digital because the opportunity is massive, right? The digital transformation is very pervasive. You know, every company across all industries are involved in some form or the other with regard to the digital spend and digital transformation. Incidentally, nine out of ten customers that we speak are still at the early stages of digital transformation. You know, the first wave was more about bringing efficiency, but the real spend is more towards transforming the business model. So that's where the real focus is, and hence we have nine out of ten, we're still at a very early stage of it. We all know what the Gen AI is gonna create in terms of the future productivity gains for the global enterprises.
We're talking about unlocking, you know, $ trillions worth of productivity gains and thereby the bottom-line contribution. So we can expect a lot of spend going towards Gen AI implementation, you know. And the critical thing of Gen AI implementation is having the right talent. I'll talk about that in a moment. So in summary, there is a huge opportunity for us to establish a new category and to lead that new category of digital enablement through talent-centric delivery model. You know, while we have a massive opportunity ahead of us, we did a very quick survey with, you know, the top 50 of our, you know, CIOs and CXOs along with Everest, which is a leading analyst. There's some interesting results that came out of the survey.
93%, it's as good as almost all of them still acknowledge it's very difficult to source, train, and retain the digital tech talent. That's still a very critical thing. More than half of them, almost 67% of the customers, say that the situation is fairly critical, right? It's scarce. The programs are on hold, so you need to have the right talent at the right cost base and also at the right time zones, right? That situation is fairly critical. You know, it's a great position to be in. You have a great opportunity that we can foresee, but the critical challenge that defines the success and the failure of a digital transformation, one of the critical aspect is talent, right?
And that really positions us very uniquely, you know, to define a new category of how we can enforce the talent story for our customers. So that's where we're talking about enabling our customers through the entire end-to-end digital value chain by defining three engagement models. The first one is, how can we continue to do, you know, what we have been doing over the years by by providing the talent services to customers? So we'll bring more innovation in terms of talent transformation, skilling, and, you know, upskilling and cross-skilling in the aspect of talent services, services. The second is the strategic pivot that I spoke about.
You know, having the global talent center model now with us, both in India, in Eastern Europe, and over a period of time in Latin and different locations, you can actually give access to the global talent for a very high-end specialized skill set to our customers. You know, the fact that we have defined four focus areas within digital, the four service line that I spoke of, and you have the infrastructure of a global centers, you know, you're actually uniquely positioned to provide managed solutions. So our ability to enhance, you know, the projects where we can start taking more outcome-based projects or where we can take more responsibilities on behalf of customer, will only increase with time. So that's the third engagement model. And with these three combinations, we could truly be a digital enablement partner for our customers, delivered through a talent-centric model.
That essentially is the core strategy about Randstad Digital, right? While having acknowledged, you know, the talent being scarce, it's not easy to hire and retain. It's also important that we build a good capability on how we actually cross-skill and upskill talent. You know, if you go and look for a Gen AI tech talent, it's not readily available. You know, the focus is a lot on how can you actually train the data engineers you have into the Gen AI capability? How can you train your developers into the Gen AI capabilities?
So you know, that's where we have established Randstad Digital Academy, you know, which is gonna focus a lot on cross-skilling and upskilling our existing talent, and also build a talent cohort ecosystem in our supply ecosystem so that we can start delivering squads and the teams to our customers, especially in the high-premium digital skill set. You know, anyone who gets through the Randstad Digital Academy and gets certified as Randstad Digital s-- you know, engineer, I sort of look at that as, you know, an assurance of a good assessment process, and also a certification of, you know, the quality talent the client gets from us in any of the three engagement models that I spoke of. So Randstad Digital Academy is gonna train more than 10,000 of our talent on the next-gen skill sets over the next two years.
So this is really gonna play a very strategic role in terms of how we deliver growth in Randstad Digital. You know, before I sort of summarize, let me also share with you that, you know, I spoke about how fantastic foundation we already have in this business. And if you go and look at the clientele examples, you know, we have quite a few of them, which are very, you know, inspiring and impressive. I picked just three of them for today's presentation. You know, the first one is the work that we do for the automobile space. You know, we have engineers who are actually trained and focused in delivering what is the next trend in the automobile industry, called software-defined vehicles.
You know, if you look at any of the new cars, it has more software than the mechanical or any of the auto parts, right? So that's how most of these vehicles are actually defined as software-defined vehicles. So our engineers working from Romanian center, actually are focused in delivering projects for automobile industry. And you know, here we are talking about a manufacturer, automobile manufacturer, where we have more than 200+ talent delivering projects on the software-defined vehicles. You know, either to enhance the in-car experience or to enhance the safety of the car. You know, it's a fascinating piece of work that our team does. The second one is on the healthcare and life science.
Healthcare has been a bit of a late adopter in the digital transformation, so there is a lot of money that's being spent in how to reach direct to the consumer from a healthcare and life science industry. We have, you know, one engagement where we have more than 100+ talent, of our client experience engineers working in enhancing that experience. And the third one is for the financial services. You know, the, all the focuses are on cloud, you know, especially on the AWS cloud in the, in this engagement. And trust me, I've been in this industry for quite some time to get 100+, you know, cloud engineers, AWS high-end cloud engineers, coming together to work on a project, it's not easy, right? So these are the things that I've actually impressed with what we already have.
So in summary, if I look at the massive opportunity we have, in digital transformation, great foundation, of the existing clientele base, 20,000 billable talent that we have, pivoting ourself into the digital enablement model of the three engagement model that I spoke of, and then finally, supported by the Randstad Digital Academy. I'm extremely excited about what we can deliver in terms of growth and value creation for this business in the next year. Thank you for listening. Thank you, Sander.
Thank you, Venu, and, Venu, let me tell you, I could not be more pleased with the progress that you have made just in 10 months from, you know, cobbling together everything we have and now having Randstad Digital with a sound strategy. I cannot say, but I love it.
Thank you.
Next guest, Mike Smith. He's a homegrown talent. He started in Australia, then moved to Singapore, then he was in the U.K. here for a while, and now he's in the U.S. to lead Randstad Enterprise. Mike?
Good afternoon, everyone, and thank you for joining us today. As Sander mentioned, my name is Michael Smith, and I have the pleasure of being the Chief Executive of Randstad Enterprise. As he also mentioned, I've been with the company for 20 years. I've had the pleasure of working in every region of Randstad, and I've also worked across every product that you see today. I'm incredibly excited to share with you the Randstad Enterprise story. As our colleagues already mentioned today, the world every day is indeed becoming more talent-led. Within Randstad Enterprise, we have a front row seat to understanding the challenges that the structural talent issues that we mentioned today are creating for the world's largest brands.
In fact, today, within Randstad Enterprise, we have the pleasure of getting up every day and partnering with over 100 of the world's most admired brands. And those brands generate for us in excess of EUR 5 billion every year. Interestingly, we also have, within those EUR 5 billion, 41 specialized Diamond-level customers. And those Diamond-level customers represent our most valued and treasured partnerships, which create a disproportionate amount of benefit for us, for clients, and for candidates today, which we'll go into in more detail during the presentation. In addition to the EUR 5 billion, the 100+ clients that we have, we also deliver a number of MSP RPO services that give us our leading position within these customers today, and I'll also touch on that more during our presentation.
Within Randstad Enterprise, as mentioned earlier by both Dominique and Sander, we act as the orchestrator of all of the services that exist within Randstad today, and the goal of that is very simple: to be able to connect the dots on the problems that our customers are having with an enterprise, with the myriad of services that we offer within Randstad across Professional, Digital, Operational , Enterprise, in a really simple, scalable, and global way. The question then becomes: how do we do this every day on a daily basis? We do this in two ways.
Firstly, those 100+ customers that we have, we have a dedicated enterprise account management team and a dedicated talent advisory team that solely and wholly, deeply and intimately understand all of the challenges that these enterprise customers have, and are working tirelessly to understand how we can connect the dots between the problems that they have every day and the great solutions and differentiated market-leading services that we offer, to be able to solve their problems at scale and simplicity in a global way. In all of these conversations that we're having with enterprise customers every day, we hear about a number of challenges that they're trying to solve. I just want to touch on a couple of them at the moment.
Firstly, we hear customers talking about the need for more scalable hiring models, the ability to be able to very clearly navigate across the unpredictable economic landscape that exists today and scale their ability to meet that demand. Secondly, we hear about their desire to really delve into having future-proofed access to critical skills and be in a situation where they implement diverse employment solutions. So being able to offer contingent, statement of work, freelance, statement of work management globally in a seamless, scalable way to future-proof your access to those critical skills is incredibly important. And then lastly, they're always looking for more data. They want to understand how, when, and where they could get work done.
The idea behind that is that giving yourself access to hidden talent, understanding where you should use contingent instead of perm, et cetera, has the capability to drive truly differentiated capabilities in cost, quality, and efficiency. However, there's one resonating message that we hear from our enterprise customers, and that one message is about ensuring that in the future, they have the capability to work with one consultative and strategic Partner for Talent . Someone that has the capability of navigating everything that we've talked about today comprehensively and being that single Partner for Talent . I'd now like to share with you a short video in which Randstad is already being that Partner for Talent for some of the world's most admired brands today.
We're looking for people that are harder and harder to find in the market, which means that we needed a complete new sourcing solution, and Randstad has helped us build this.
Our first engagement with Randstad was in 1973, so nearly 50 years ago. Because of the range of services they provide, they are able to engage across the entire life cycle and engage talent at different stages in that life cycle.
We've completely outsourced all our recruitment activities to the Randstad Group. A lot of clients, I think, are reluctant to see too much of this being outsourced because it may feel like they're losing control. We look at it very differently. We retain the control, but what we're gaining is the expertise.
Whether it's advisory services or talent marketing solutions, Randstad always shows up with a unique perspective and a deep knowledge of our business, which really allows us to create great strategies together.
We have a very intense collaboration on various levels that starts really on shop floor level, where we have people from Randstad in our sites helping to solve the issues that we have on the recruiting side.
We had a moment where we actually had to increase our recruiting volume significantly, and Randstad was able to partner with us to scale from 100 to about 400 recruiters over a period of about 4 months.
I receive a lot of information about market trends. We discuss current developments like home office, what are the challenges we have with Gen Z.
Sitting down with a team of probably about 100 people now in Randstad who work with us day and night and saying, "Okay, this is the vision. This is where we want to go," and to hear nothing but really healthy enthusiasm from everybody, it's the best part of my job.
If you're looking for a partner that has both deep and wide global reach, who can support a very complex portfolio in a simple way through end-to-end solutions throughout the talent lifecycle, Randstad is that company.
So as you've heard from some of our enterprise customers today, Randstad is uniquely positioned to help customers be that single Partner for Talent and navigate that end-to-end talent solution that organizations are looking for. We attempt to bring that to life through the current slide, where we talk about the ability to help organizations with all the inflow of talent that's coming into their organization. Once that talent is within their organization, we have the capability to help it move around the organization through coaching, through advisory, and then in addition, we have the unique capability to help organizations with the potential outflow of certain skills, consistent with the values and culture of their organization. Surrounding that is our talent advisory, our enterprise account management, and some of the differentiated functions that you heard our customers already talk about....
More recently, we also had the pleasure of having this single Partner for Talent thought process underpinned by Everest, the leading analyst for our community, where we were ranked as the only organization globally as having, being a leader in every single talent service that they analyze. That really underpins our unique category of one positioning within the market currently. There were three other demands that we constantly hear from enterprise customers, which we're gonna cover during our talk today. The first is, these enterprise customers continue to demand that we're creating cutting-edge talent solutions with them that are constantly underpinned by technology. Martin, later on, is gonna talk about the way that we're doing that at scale within Randstad and how that's helping our enterprise customers, but I wanna share one example with you. Within Randstad already, we've created an automation COE.
That automation COE has already automated 100,000 hours of tedious administration work, freeing up our consultants to go and do more value-added work on behalf of our customers. Secondly, lots of our enterprise customers demand the absolute best talent in the market, and in order for that to be true, we need to have the best talent within Randstad. So later on, you're gonna hear Myriam talk a little bit about how we bring that to life every day. One example of how we're doing that already is thoughtfully cross-training our people. So in the economic recovery of 2021, we saw an incredible surge in hiring at most of our tech customers. We'd already, however, pre-trained our career transition consultants to be recruitment consultants and talent advisors.
So we were able to meet that unexpected demand of the surge in hiring in our technology customers by deploying those people rapidly for our customers. And lastly, as mentioned earlier in my presentation, clients have an insatiable demand for data. And within Randstad, we've thoughtfully built out our Randstad Market Insights tool, which brings together all of the data that exists within the Randstad ecosystem to create the most statistically significant insights in real-time labor market dynamics. And Martin's gonna talk about how we continue to drive cost, efficiency, and quality improvements for our clients. I'd now like to turn your attention quickly back to our enterprise customers so that you can get an idea of just why this is such a critical part of the overall Randstad narrative. As I mentioned earlier, we have 100+ of the world's largest brands represented within this portfolio.
We have EUR 5 billion worth of revenue every year. In addition to that, we also have a special diamond segmentation within those 100 customers. Those Diamond customers, at present, spend at minimum EUR 10 million gross profit with us every year and represent our most trusted partnerships. They also typically buy more strategic end-to-end talent solutions from within our portfolio in a multi-year engagement underpinned by technology. We also offer these customers a more customized and dedicated service, which continues to mutually benefit each other and grow the overall partnership that we have with these customers. Now, I wanna delve into a few more data points on why it's critical for the Randstad narrative to have these enterprise customers. Firstly, it's about growth. Now, we've done an incredible job of growing our enterprise customers over the last 6 years.
We've gone from EUR 3.9 billion to EUR 5.1 billion with enterprise customers. In addition to that, however, what we're most excited about is growing more enterprise and Diamond customers. You heard me mention that already we have 41 that generate in excess of EUR 10 million gross profit each annually. If we double-click underneath that, what we see is that we already have another 60 that spend between EUR 5 million and EUR 10 million, and then we have another 150 that spend between EUR 2 million and EUR 5 million. So we have this incredible capability to continue to leverage all the services that you've heard about today in a thoughtful and intentional way to grow these clients up the value chain and continue to create more value creation for Randstad. In addition to this, we have more resilience within this portfolio.
If you look at the way that these customers have continued to grow over the last 6 years, we've seen double-digit gross profit growth in all of our enterprise customers, in particular our Diamond customers, over the last 6 years. Thirdly, these customers typically buy and procure more end-to-end talent solutions for us. That's evidenced in the fact that if we look at the gross profit makeup of our Diamond customers over the last 6 years, they've doubled the amount of gross profit they spend in our enterprise, in our digital, and also in our Professional segments, evidencing the diversification of our services and our ability to continue to get into the C-suite and really drive differentiated value creation. 2 more data points.
The retention of these enterprise customers sits currently at 97.5%, and we have an NPS score of 42.85, both hallmarks for our industry. If we look at the total amount of Diamond customers that we had in 2017 to now, we still have all but one of those customers. Really an indication of our ability to re-win and expand those customers and continue to create incredible lifetime value creation for us and then, and for them. Then lastly, I mentioned that we work with the world's best brands in this space, and 50% of the Fortune 500 companies are evident within this portfolio for us, and they act as a talent magnet.
We're able to continue to attract better clients as a result of their desire to want to receive the same service that our Diamond customers get today, and those incredible brands act as magnets for candidates who wanna come work for those brands. And that cycle allows us to gain more scale and efficiency in how we deliver to the whole of the Randstad Group today. So in closing, the real magic of Randstad Enterprise comes together when we take the local expertise of our operational professional individuals. We combine it with the global delivery capabilities of enterprise and digital, and then we fuel it with the enterprise account management and workforce advisory capabilities that we've thoughtfully and intentionally built to really offer an unrivaled symphony of service to the world's largest brands that absolutely cannot be easily imitated today.
We're incredibly excited to continue the growth ambition of what we have for our enterprise clients, and we look forward to sharing more with you over the years. Thank you.
Thank you very much, Mike. You know, it's great getting to know you over the past 18 months. You know, Mike and I both like big clients and big deals, so we get to spend a lot of time together, which is great. We're gonna have a short break. We're gonna be back at five minutes to the hour, to sharp at three- to start at 3:00 sharp.
Wasn't looking for nobody when you looked my way. Possible candidate, yeah. Who knew? That you'd be up in here, looking like you do. You're making staying over here impossible. Baby, I'ma say your aura is incredible. If you don't have to go, go. Do you know what you started? I just came here to party. Now we're rocking on the dance floor, acting naughty. Your hands around my waist, just let the music play. We're hand in hand, just a chance, now we're face to face. 'Cause I wanna take you away, let's escape into the music. DJ, let it play. I just can't refuse it, like the way you do this. Keep on rocking to it. Please don't stop the, please don't stop the music. I wanna take you away, let's escape into the music. DJ, let it play.
I like the way you do this, keep on rocking to it. Please don't stop the music. Please don't stop the, please don't stop, please don't stop the music. Please don't stop the music. Please don't stop, please don't stop. Please don't stop the... Please don't stop the music. I said, baby. So baby, are you ready? 'Cause it's getting close. Don't you feel the passion ready to explode? What goes on between us, no one has to know. This is a private show, uh. Do you know what you started? I just came here to party. Now we're rocking on the dance floor, acting naughty. Your hands around my waist, just let the music play. We're hand in hand, just a chance, now we're face to face. 'Cause I wanna take you away, let's escape into the music. DJ, let it play.
I just can't refuse it, like the way you do this. Keep on rocking to it. Please don't stop the, please don't stop the music. I wanna take you away, let's escape into the music. DJ, let it play. I like the way you do this, keep on rocking to it. Please don't stop the music. Please don't stop the, please don't stop the, please don't stop the music. Yeah. Please don't stop the music. Oh, yeah.
Riders on the Storm . Riders on the Sto rm. Riders on the Storm . Riders on the Storm . Riders on the Storm . Riders , ride. Riders on the Storm . Into this house we're born, into this world we're thrown. Like a dog without a bone, an actor out on loan. Riders on the Storm . Riders on the Storm . Riders on the Storm . Into this house we're born, into this world we're thrown. Like a dog without a bone, an actor out on loan. Riders on the Storm . Riders on the Storm . Riders . Ride. Ride rs.
Lay down your head and show me if you like it. Lend me your ears and read me like a book. This conversation, it strikes me. No need for words, it's so understood. Lay down your head and show me if you like it. Wonder if there is something we did wrong. Nothing can stop me from shaking. Why did we have to fire that gun? Lay down your head and show me if you like it. Wonder if there is something we did wrong. Nothing can stop me from shaking. Why did we have to fire that gun? Why did we have to fire that gun? Oh, why did we have to fire that gun?
Our summer day withers away. Too soon, too soon. Speak low, darling, speak low. Love is a spark lost in the dark. Too soon, too soon. Speak low, when you speak love, our summer day withers away. Too soon, too soon. Speak low, darling, speak low. Love is a spark lost in the dark. Too soon, too soon. I feel wherever I go, that tomorrow is near, tomorrow is here, always too soon. Speak low, when you speak love, our summer day withers away. Too soon, too soon. Speak low, darling, speak low. Love is a spark lost in the dark. Too soon, too soon. Speak low, when you speak love, our moment is split like ships adrift, we're swept apart too soon.
I guess that's the end of the break, so welcome back. Earlier today, we talked about how we're gonna make a step up on talent and client delivery. So I would like to welcome our colleague, Jesús, who looks after talent and client delivery on a global basis. He's another one of those homegrown talents, and he was actually the one who received me in Spain for the very first time. And I can tell you one thing: I know a talent when I see it. Jesús.
Randstad has been very, helpful in my job search, actually. It's a new job in a foreign country for me.
I'm a student, and I have a very strict school schedule, so I don't always have time. Randstad really, really helps me just by actually being very flexible. I like to learn, new things, and they offered me a position, which was for me, kind of level up.
They help with the job search, but also support you as, someone from another country.
They understand my needs and my skills, so if I have any questions, I will have an answer immediately.
Also providing the necessary training for you to grow as a person, as an employee, as a professional.
If I would describe Randstad in one word, I think, the word would be support.
Stability. Flexible.
Heel fijn iet s.
Great!
So, good afternoon. Thank you for joining us today in London, this Capital Markets Day. And, I will introduce myself, even though Sander has introduced. My name is Jesús Echevarría, and I've been working for Randstad for 20 years. And today, today I'm very excited about going a little bit deeper in two pillars or the five strategic pillars that Sander said: specialization, talent, delivery, platform, and best people. And we're going to go into the first thing. It said by everybody in the – during the day. I mean, Sander said talent expectations are increasing clearly because scarcity. And scarcity is a reality in many, many markets, and scarcity is due to the fact that we have more vacancies than people looking for a job in many markets, in many segments, and this is a reality.
Talents are looking for clearly more than a job. They are looking for belonging, they are looking for learning, a career path, a professional growth in the company, about learning, skilling, reskilling. They are looking for flexibility. We have seen in the video, they look for more flexible jobs, doing some work from home, a career development, as Dominique said before, one job, another job, another job, a partner for me - a Partner for Talent , with a seamless experience and not only jobs. They are looking for jobs with purpose. This is what talent are looking for. But it is not only about that. They are also... the workforce is becoming more global and more diverse, and this is a reality, and we need to have everybody on board. We need all the pools of talent that we can have and access to.
In this, in this, groups of talent, maybe we can train and we need to coach a little bit to all of them. But there is a talent in each person, and when we place a talent in the labor market, we have done a very good thing for the talents, a very good thing for Randstad, and a very good thing for the society. This is a reality. If we think about equity, the things that we are doing today are more or less the following numbers: We are placing more than 700,000 people below 25 people. We are placing more than 270,000 people above 50. We are placing 300,000 people without any education. We are placing 22,000 refugees and 13,000 disabled people.
This is a very good job. These are very good numbers that are increasing year after year due to the consequence of our choice. With this activity, we are setting a new standard in the industry. We are putting the talent principles, the talent rules in our systems. They are embedded, and we have the most ethical and transparent processes to all talents, that they can choose wherever they want, the job that are fitting best their needs. This is what we call equity by design, and we have recognized for all of these activities for the Dow Jones Sustainability Index as the unique talent company in this index. Okay, we have seen that, and we are going to see what is the Randstad proposition to all of these people. We want to capitalize the strength in the market from our brand, from Randstad.
We are leading the shift in becoming the talent-centered company. We are leading the shift, moving into putting the talent and equity in the center of everything that we do. People are not looking only for a job. We have our value proposition for these talents is very clear. We have the more relevant job opportunities, equitable opportunities, and we have a career path, a professional growth through Randstad. So we can train these people. We skill these people. We already have trained 300,000 people, and we have invested more than 5 million training hours to develop our talents. And this means that we have the capability to access to many, many different talent pools, and that brings that the dependency on external sources is lower for Randstad. Okay, but, what are we talking about? What are we talking about?
We see clearly how talent expectations are getting more and more demanding than ever. But let me share with you a few numbers. A few numbers that to put in context the size of the things that we do, what we do every single day, what we do, the 40,000 people that we are in the company. We place, every year, more than 2 million people. We find a job for 340,000 people working for the customers, and we have 75 million people in our databases. These are the numbers that we have today. But this is on yearly basis, but let's put in perspective to realize about the size of the things we do. Every single week, we have more than 600,000 people working.
Every single day, we have 10,000 people hired, 30,000 people registered, 1,500 placements done. It means that every 9 seconds, we do a placement. Every 3 seconds, we have a new talent registered in our databases, including night. So the reason why we can deliver these services is because the size and the quantity of activity that we do. Imagine the power of improving any of these things, improving time in placements, in registering, or whatever, the impact is huge because the volume of things we do. And we can ask ourselves, why customers, why customers prefer Randstad? Why customers buy Randstad? Sander said it before. Customers buy Randstad because we deliver, and we deliver by specialization. We have this industry knowledge in each specialty. We, we talk the same language than our customers, and we deliver at scale... at speed with the right quality.
And that means that we have a very high customer client satisfaction score, above eight, which is fantastic. This is the reason why the customers buy Randstad. But then you could think, "Well, what is the delivery excellence that you are talking about?" And the delivery excellence is, I would say, easy to explain. It's a combination of few things. The delivery architecture that we are building is a combination of systems, processes, steering, and people. And this is a very complex thing because it's not one, each one of them. There are a strong dependency from one to the other, and all of them are completely connected. It's a very unique competitive advantage, by the way, very difficult to copy, extremely difficult to copy.
This delivery excellence that we have is also built on the 60 years experience, Randstad experience that we have, and applies to all the business models and delivery models and specializations that we have. I mean, it fits for perm, for staffing, for in-house, for outsourcing, for RPO, for any business line, and all specializations. You can think, "Well, and what is the value? What is the value from this delivery excellence that you already have?" Well, the value, the more relevant thing is about talent and client and customer satisfaction. Talent and client satisfaction is the key thing. If we have talent and client satisfaction, we are going to grow, and we are going to get profitability. How are we going to get this? Well, the first thing, it seems easy words, but they are quite strong: consistent. What does it mean?
We always deliver. It doesn't matter where we are. We deliver the same in London, in New York, and in Tokyo, and we deliver always on Monday, on Friday, in January, in August, in any moment, becoming reliable for our customers. Another critical thing I would say is about efficiency. Having these new models that we are going to share later with you, we are going to increase and to have a seamless processes. We increase productivity because to apply our field steering with the data that we have, and we improve the conversion rates in the processes. We also are going to do one thing due to the new delivery models that you are going to see later. We are going to adjust our accommodation footprint as a consequence of all these improvements. These models allows us to scale fast.
We have one global delivery excellence model that we scale, we copy, we put in place in the markets where we are not today, or we apply to the other specializations. I also will remark that helps us to keep in control our risks. I mean, we are... Due to these capabilities, we are going to have health and safety risk completely in control. We have equity in our systems, and we are also going to have a lower dependency on external sources, which allow us to be-- to become, to have access to more talent. And of course, we are going to drive, drive innovation. Why? Because any improvement that we are going to do in the systems will be immediately deployed in the other specializations, markets, or whatever. Okay, that's good. Can we be a little bit more tangible? Yeah, we can.
This is the omnichannel go-to-market approach. Let me split our processes in three big blocks. It's about looking for talent, I would say talent validation. It would be about getting sales, and of course, if we have a talent and we have a customer, a client, what we have to do is the matching. This is our business. So let's go through the talent validation, looking for a talent. Our traditional way of doing things was the branches are going to look for the talent. We have developed and built these talent centers, which are specialized teams looking for talent. And we, of course, can look for talent digitally using the platform that Martin will explain later. Okay, let's think now about sales. Sales, we can get orders from our strategic accounts.
Mike Smith said it before, we can get orders and customers from our traditional commercial activity in our branches, but we can also get sales from digital, from the platforms. Very good. And how are we going to do the matching? The matching we can do with the traditional branches, we can do with in-house, our traditional in-house and very successful model in-house, EUR 7 billion, big numbers, which is big volumes in one site. We are building delivery centers, which is big volumes, multiple sites, and we, of course, can have a digital matching done by the systems. And the beauty of this chart is that this is a kind of Lego model. I mean, you can choose or pick one or two different pieces in each row to fit, to look for the best way to serve one specialization in one market.
There is another thing very nice in this chart. The more we move into the right, the more efficient we are. I mean, talent center are clearly more efficient than the traditional way to look for people at branches, and digital are even more efficient than the talent centers. And this Lego model allows us to combine all of these things, but there is also another very relevant thing in this chart. It's about the omnichannel approach. Omnichannel approach means that talents can reach out to Randstad in their best way, digitally, in the branch or whatever, or customer can reach out to Randstad at their best convenience. But also another thing that we can apply, we can apply the benefits of these new models, talent center, digital, to the existing customers. We are not going to have only a pure digital channel.
All the customers can benefit from any improvement in these new delivery centers or digital capabilities. As an example, our traditional delivery model in-house, very successful, could be served from a talent center and digitally. Clearly, we are going to increase the productivity of this model due to the new delivery models. Yeah? Of course, if we want, we can have a pure digital model, where talent validation is going to be done digitally, sales are going to be received digitally, and the match can be done digitally. I think that we have been talking about this, and this is very good. What we think, what we say is fantastic, but at the end of the day, what really matters is what we do. I'm going to share with you four examples about things that we are doing today.
And let's go to the first one. The first one is to go a little bit deeper into the talent center. Talent center is a dedicated team, a specialized team. Specialization is also for our own staff, a specialized team to look for talents with a seamless process. I'm going to talk about two different practices that we have today. In Spain, specialization is Operational, and we have 5% fulfillment uplift. We have 25% productivity gain, 60% reduction of time to fill, and the more relevant one from my side, 95% total independence in looking for talents. We are not depending on external sources to look for talent with this, through this talent center. Why? Because we have these people focused, specialized, and trained in looking for these talents. Let's go to another part of the world, in this case, Japan, Operational and Professional.
In Japan, we are increasing 10% the talent utilization, by 10% the talent utilization, so from the people that reach out Randstad, we use 10% more, and we also use our equity. We apply equity to our own people, and we have 50% of the colleagues with disability. So putting equity in the heart of the things we do can perfectly fits with delivery excellence. This is one example in the lower row about looking for talent. Let's go for the next one. The next one is about delivery centers, customize, customized delivery solutions for customers. Customers are looking for only one single point of contact. They are looking for a partner who fits the needs that they have. And again, I'm going to share with you two different experiences. We have in Spain, a Professional banking.
We have done 3,000 placement in 3 months, but the thing is that we have done this in one thousand seven hundred and fifty different locations. The fulfillment ratio is 100%. The satisfaction rate, the satisfaction rate for the customer is above 8, and we have 70% productivity uplift. So the more we move in the matrix to the right, the higher the productivity is. Let's go to the Netherlands. In the Netherlands, we have a completely different delivery center. This delivery center is for the government. We are serving through to 3 different ministries. We serve to the Ministry of Tax, of Water, and Interior. We have one dedicated team, and we serve more than 1,000 people all around the country in the Netherlands. And the thing are again, the same.
The conclusions are more or less the same. Customer satisfaction, client satisfaction, above 8, and a clear productivity uplift of 30%. Okay, that's, that's good, but why, why we exceed client satisfaction with these centers? Why these centers bring so much value to us? Well, if we think and make it very easy, clients are looking for three things: quantity, I mean, I want all the people I've ordered for; quality and speed. How we deliver these three things? Well, quantity. Quantity is because we have access to one of the biggest database in world, 75 million talent, 70 million talents, but we have a very good search and match tool. It's not only about having 70 million people, it's about having the tool that allows you to look for the right person in the database, powered by AI, and this is the difference.
Secondly, I would say about quality. Quality, because we are moving forward through the specialization, and we have a specific validation process, depending on the profile for each specialization. That warrants for the customer that the quality of the talent that we are delivering to them exceed their expectations, their needs. The third one is about speed. Speed. Speed, how we deliver speed faster than our competitors? It's not because we try to do it a little bit better. We are going to make it a little bit better. No, it's more effort. No, it's because we change the process. We don't wait the order to start the process. We move from order-driven to forecast-driven. Again, we use AI. Martin will explain it later to have forecast, and we look for people and we validate people before having the order.
So at the moment that we receive the order, we only have to do the match, and this is how we increase speed to deliver to customers. And on top of these two examples, we have an additional opportunity, which is going to be the third example. The third example is going to be about global talent delivery centers. It's not only about building these capabilities, training these people, defining all of this process, also we can scale and have a location strategy. And we have these global talent delivery centers in few places in the world. We have mainly in India, Eastern Europe, and the benefits from that is that we can scale faster, we have flexibility, we can balance from one country to another country, from one specialization to the other specialization.
At the end of the day, this third example allows us to have between 25%-50% productivity gain. We already have 4,000 people in these locations, and we are planning to add an additional 2,000 people in the next 12 months. But you know, as we have said, what I say is not so relevant. Let's listen some of the people who are working in these centers.
We deliver to over 50 clients using 15 languages when cooperating agility, flexibility, but also standardization, digitization, and the one team spirit.
My job is to find the right profile and to connect the client and the candidate. It's very important for me to set the tone in the first meeting and to establish a good connection. There's a standard process that I get help from Randstad by training and different documents that I use that help me to be very successful at my job.
We are a talent center to customize, to help, and meet our customer needs. We collectively process over 200,000 requests in a year. There's a couple of ways that we do that. One is we do a lot of pipelining. Customers go through different peaks and troughs, and the demand is different. So one of the advantages of building a large center here is we are able to scale up and down just to make sure that we can meet them at the point when they need it.
The benefit from the talent center is clearly client satisfaction. We have been able to reduce the time to fill by 60% and to increase the fulfillment by 5%. Also, we engage talents with their skills and their preferences and increase the opportunity in redeployment. That's why we work at Randstad.
Wow, fantastic! I want to say it. So let's go to the fourth example. We are going to talk now about some digital marketplaces examples that we have today. We are already doing close to EUR 1 billion business, and our ambition in the next 12 months is going to double this business. This is going to be good. Let's talk about three examples. We have a lesson from Monster. In the U.S., we have Operational United States. We place today in Texas and Florida close to a little bit more than 10,000 workers every day, and we are planning to uplift this by 20,000 additional workers in 2023, achieving 30,000 workers in States. The benefits, Monster has a lot of benefits. We are open 24/7, but we see a clear additional benefit.
As the talents can have access to the platform out of the working time, I mean, at night, Saturday, Sunday, whatever, we have seen an increase of working hours per talent. So the same talent are working more hours. We have seen a 5% more working hours in States due to the fact that they use the digital platform. We increase the talent utilization, and we have more revenue for client. This is operational in States. We are going to go now to professionals in Professional education in Australia. Okay, I explained a little bit about this before, but I'm going to go deeper with that. We are doing 1 million shifts per year. This is a reality, a heavy use case, and we are doing 90% full digital matching.
But what is amazing, and it's the combination of the matrix, we uplift from 90%-99% with a delivery center. So we do the matching 90% digitally, but to ensure the quality to the customers, we uplift this to 99%. This is a winning strategy against any other digital competitor. And we have, as a consequence of that, 52% revenue growth. Now, we move from Australia again to Europe. We go to France, and in France, we have seen the healthcare, the healthcare example. I'm going to bring another one. We have retail in France. We have 25,000 talents in France, working in 1,400 different locations in a very efficient way.
We have the result of this process is that we have above 90% fulfillment ratio, we have a clear market share gain, and we have increased revenue by 100% one year compared with the other year, which shows the huge potential of this digital marketplace in our landscape. And this is the fourth example. Martin will explain later how we connect all the people that we have and all the customers that we have through the Randstad client platform. So as a summary, I would say. The talent is scarce, very, very scarce. We have built this delivery excellence. The delivery excellence is this combination of systems, process, people, and steering. Very complex, extremely difficult to copy, that allow us to deliver to talents a very high satisfaction and to client a very high satisfaction.
This allows also to be reliable at scale, at speed. We do what we say. These two things will bring growth to Randstad. And this model, as you have seen, is very cost efficiency, and this is how we are going to increase profitability. This is what I wanted to share with you. So, Sander, I hand over to you to go to the next two pillars.
Thank you very much, Jesús.
Thank you.
I'm sure you will now all have seen that why Jesús is in this job. He has the passion, he has the knowledge, he has the attention for detail. He knows what he's talking about. Let's move to the next subject with Martin on the Randstad Talent Platform, and Myriam on Best Team. Myriam and Martin. Oh, stay. Let's start with you, Martin. I'm gonna sit down. You know, you and I go back a long way. Martin and I got to know each other in our previous careers when we were doing big, hairy billing systems for utilities, not only in the Netherlands, but also even here in the U.K. So Martin, I mean, you've been around the block in information technology, 30 years, maybe, almost?
Thirty years.
Yeah.
Thirty years.
You joined Randstad about a year ago.
Yeah.
What have you seen so far? What's your impression?
Yeah, well, the impression is always related to your expectation. When Sander called me and said, "Do you want your name in the hat?" I thought, "Wow, that must be quite a big job for me to leave Accenture, but also to come to Randstad." So I was expecting there would be a problem. I've been here for a year now, and I've been looking at it. There's 75 million people on our websites. We've got 100,000 clients working with us digitally through portals. We got marketplaces, we got people that need a payslip, we got people that need a bill, and we do that in 39 markets, around a number of specializations, we call them now, but a number of pockets of employees, and I got zero phone calls for a year.
Nobody called me for a crisis. Nobody called me that there was an issue with the payroll or an issue with the billing. So I think there's a flawless execution here at Randstad every day, and I find that deeply impressive because, in a way, this is a process industry. The numbers are so big; if you have one hiccup, you got a million hiccups. You cannot make a mistake in this industry because there will be so much work to catch up, and Randstad is the best in this. That's totally clear. And that's why if Jesús says we have a reputation for delivery, it's clear that it's not just in the business, but it's also in IT. We have 1,700 IT people that do a marvelous job every year across all the markets that we're in.
And that was a massive relief almost for me, that we would not be in problem-solving mode, but we would actually be looking at something else. And many people have said it so far, the Randstad Talent Platform, if you look at where we are, we have many, many solutions across the world, and they—I think everybody has been working to create the best online and offline experience for our talents, who wanna work 24/7, who wanna schedule their own shift, but also our clients, who wanna drop in their own work and not have to talk to a consultant for all specializations that we have now defined in all our markets.
I think it's important that we keep investing in creating that platform and building that platform out, to make sure we serve our talents, and our clients, and our employees in the right way. People talked also about scale, and systems are simple. If you have a system, you can scale it, and your marginal cost is minimal. So actually, if we move towards a global talent platform, that makes us scalable and that will drive benefits, efficiencies, and we can automate things that we currently sometimes cannot automate because we lack the scale, because of the spread across the market. If we innovate on one platform, if we innovate once, we innovate for everybody. If we make an adjustment to an app, it will be an adjustment for everybody, and I think that will drive a lot of innovation that we can create in these markets.
The economies of scale are obvious. I mean, there's less cost of maintaining the solutions, but also, if we wanna change something again, we change it once. And then last but not least, we can right source. Now, we have many partners we work with in many countries. We have many people in IT in many countries. By moving to one platform, it becomes easier to maintain and to invest. We can do that at a lower cost point, and from an HR point of view, we can also build a capability for our own IT people, where they can make a career, and they stay with us. Because Randstad, our business, it's a special business, it's not...
You cannot find it anywhere, so we've got to make sure that we keep the deep knowledge of our IT solutions and the deep knowledge of how they work and why they work that way in Randstad, and by bundling those skills, we can actually foster the career of the people that work with us. What does it look like? It's a very simple picture, and as I said, we have many, many variants in the world because for every segment, we need to tailor a little bit. That's why we call it a platform and not a system. It's there to drive specialization and talent and client engagement. I work from the outside to the inside. On the left-hand side, you see the talent engagement. People more and more want to work through the web, through apps.
We have branches around the world, and when I was young—I, I'm, I'm a Dutchman, so I know Randstad from my, from my very early days. You went to the branch and found a job. People still do that, but they also want to go on the app or on the web to find a job. And actually, what you see is that 60% of our interactions are now through our various apps that we have in the various markets. The same on the client side. Clients wanna post their shifts, wanna post their jobs in an interactive way, but sometimes they also want a conversation. They want some advice, and that's when they can go to the front office... to our consultants. So the outside of our organization will become more and more digital, what shifts there are, and app doesn't know what jobs there are.
So we're currently investing in our front office, and the front office is where the talent meets the client. That's where we have our jobs, that's where we do our search and match, and that's where we make the deal, if you will. The front office we're building currently based on Salesforce, it's live in one country. It will go live next week in the next country, and the feedback that we've had from the people in our company working with it is amazing. Because it's not just the front office, it has pricing advice, it has information that they never had before, and they had to pull from a spreadsheet somewhere. They claim, and they explain why, that they can find better talent faster in our existing database.
So we can see huge benefits already by creating that one front office, and through the talent app and the client portal, we can actually expose that front office to the world so people can do it themselves when they want. The mid office at the bottom is the cash register of Randstad. That's where we have the contract, we have the time sheets, and from those two, we create a payslip, and we create a bill. It's of course a lot more complicated than that, but that's the simple synopsis. And then what is absolutely key, in the middle, we have the common services and the integration. We will have to gradually implement this platform, allowing for space for particular functionalities that we need for specializations or for certain markets. Certain markets have regulations, certain specializations need some extra functionality.
Our common services enable that, so we can click special functions in there, but it also houses the secret source of Randstad. That's where our AI lives, that's where our search and match engine lives, that's where simple things like CV parsing lives, and that's common services. Block serves all the surrounding functionalities, so that we only need to change it in one place. So it's a really simple picture. It's a lot more complicated than it seems, but this way we can serve our talent and our client in the way they want by using one unified core for Randstad, and that altogether is the Randstad Talent Platform. What's important, we go standard where we can, because not everything in Randstad is special.
Where we can be standard, we will be, but we will be Randstad where we need to be, because that's the secret sauce of the company that we definitely don't want to lose. We're working with best-in-class technologies where we can, and we're working with the best partners that we can find. I think we have some excellent partners on board, helping us to deliver this at the right pace.
Yeah, Martin, obviously very exciting, but I can sense some people thinking in the room here, "Sounds exciting, but that's a significant undertaking." So how are we gonna do that?
Yeah, it is a significant undertaking, but this picture exists. It exists in 39 markets because this is what we do. So we have hundreds of people, if not thousands, that know very well how this works, that can help us design the next generation of this functionality. So this is not an exploration, but it's more a globalization of something that Randstad is already incredibly good at. So if you look at it, we will have a relentless focus on value, and not just because we made a business case, and there is a business case for everything. But having the focus on value also helps you to limit your scope, it helps you to identify how you wanna roll this out to get the maximum value out of your investment.
So not IT for IT, but actually IT for the business, driving value and value for Randstad, it's client engagement, talent engagement, and what I always call stickiness. And if we can achieve that by the investment, then we get the maximum value. We're also gonna do this more or less within the boundaries of our current investment level. We've been investing in the front office for several years. We're gonna invest a little bit more for mid office and apps, but we can find that money in the savings we can make in the existing budgets. So all in all, maybe it will go up a little bit, but it won't break the bank, to say it that way. And what is super important, we gotta keep the business running. So we're gonna go as fast as we can, but as careful as we must.
We are a process industry every day, every week, every month. As Jesús said, if we have, I don't know the number exactly, 10,000 people logging on or something a day, they need to keep logging on because that's what we do. So we gotta keep the business going while we do this transformation. And also there, this, this setup with the common services allows us to gradually, in the larger locations where we are, gradually replace the landscape and prevent the big bang where everybody wakes up tomorrow and there's a new Randstad. So the whole setup actually is also there to protect our business. And last but not least, the people, Myriam will talk more about that. Our people are phenomenal. They have a fantastic, deep insight. They push for client happiness and talent happiness every day.
We gotta bring them along because they, they are the only asset other than IT that we have. So they gotta come along and make it work, because I can build any system with a bit of luck, but if the people don't want it to work, it will never work. It will make it work. That simple.
Thank you very much, Martin. That was, that was very clear. Let's, Mirjam, let's move to you. I mean, we don't go back all that long. We got to know each other a little over a year ago, I think. Two years already? Oh, my, time flies when you're having fun. You're right. We got, got to know each other even before I joined, because Myriam was in-- just thinking of moving on from her job as CHRO at Cargill. She wanted to move back to Europe, and that was the moment that I called her. So and I'm so happy that that moment happened. So, Myriam, what have you seen so far at, at Randstad?
Yeah. Thank you, Sander, and good afternoon, all. I remember the very first conversation we had when you shared that Randstad is a unique people culture and also a huge opportunity ahead, and those are the reasons why I'm here today. I felt at the time that with my background in corporate strategy, finance, and HR, I can contribute to driving the new strategy of becoming the most equitable and specialized talent company... and now 15 months in the job, I can say that we have the right fundamentals here in terms of people and culture. Our purpose is very strong. Our people take pride in our mission and our values. Dominique talked about it. We have 84% of our employees that find their work in Randstad highly meaningful, and this is remarkable.
In all the markets that I visit, what I hear is very consistent. Our culture is very strong. People care, they respect each other. We are entrepreneurial, we are pragmatic, we have a strong sense of ownership, we are fast and agile, and this is what I have observed. This is Randstad, and I can say that those fundamentals are really difficult to get right in very large corporations, and we have them here.
Very good. The world of work is changing. That means it's also changing for us. We need to raise our game as well. We need to deal with the Big Three at Randstad. How are we going about it?
Yeah, you said it, and, and Mike mentioned the word is talent-led due demographics. Jesús talked about the talent expectations that have evolved, and this also applies to our own employees. They want belonging, they want to thrive, and for that, they look at their employers to get support in their careers. At the same time, I hear from our employees that are very excited by our new ambition, and this will require a different way and evolution in the way we think, we work, and we deliver. So it means a few things in terms of people and culture, and I'm just going to talk about two today. One, we focus on equity. We said we need all hands on deck nowadays. Equity is a strategic imperatives.
In fact, in our Workmonitor research, we found that 54% of people would quit their employers if they feel they do not belong anymore. So equity is really a significant factor to attract and retain employees. Now, at the same time, I said, we hear that our people are very excited to be here. We start from a position of strength. Unlike many other companies, we have here at Randstad that position of strength. Over above 50% of our total workforce are female, and we have employees across 5 different generations, from very early graduates to close to retirement people. So with such strong foundation, we must dream bigger, and therefore, we have engaged with our organization to achieve gender parity by 2030 in senior leadership positions.
We think, I think, that this is a reasonable, yet important goal to achieve, considering that we have a baseline of 39.8% of female in leadership position today. So very good, but beyond gender, we have a more holistic ED&I strategy that addresses specific underrepresented minorities in all the markets where we operate. So that's one. The second is focus on Best Team, one of our five strategic pillars. In a company where people are almost the only asset, we must have the right skilled and motivated people in the right position today to achieve our ambition. There also, when each time I engage with our employees, I'm amazed by the strong talent pipeline that we have.
In fact, when you look at the executive leadership team, 70% of the positions came from internal promotions, and just a few targeted external hires came to bring some specific capabilities. So this is a healthy mix of internal and outside-in perspectives. So very good. But this also created opportunities, development opportunities for many more in our organization, and we'll continue to bring on that strength by focusing on careers for all. Why? Because, as we said, employees and talents are looking at their employers to get support in their careers and in identifying the skills they need to grow, and this is core to our EVP.
So as we continue to develop our best team, we will continue to evolve our employee value proposition, and we'll do that by fostering a culture of continuous learning and well-being, by integrating faster the new hires that we have, and by creating careers for all. I'm very convinced that the specialization framework that you have heard about today will make it much easier to create those clear career tracks for people. As we become more globally aligned, it will add development opportunities for all as we make Randstad a career marketplace for people. So that's my view, Sander, but I think it will be impactful to hear from our employees.
Okay.
I think the work that we get to do, at Randstad is really challenging and meaningful.
I think we look at the whole person, so personal growth.
It has been an incredible experience all these years. A lot of learning opportunities and professional growth for me.
What I like is the colleagues around me.
I want to make an impact to society and to the people who are in the society.
To help people get their dream job.
It's allowed people to buy their first home. It's allowed people to start their families.
You know, to be able to make a positive difference to people's lives and to be able to see it is very meaningful.
And I feel like the Randstad culture translates, no matter which country you go to.
Everyone is encouraged and supported to be the best version of themselves.
Everybody is striving for the best.
Equity, diversity, and inclusion is my life work, so I am very lucky working at Randstad.
Well, a 15-year career journey is hard to put into three words. I think impactful. It's been really impactful for me.
Well, warmth and belonging.
I think it's people.
Professional, passionate, and fair.
People-centric and dynamic.
I'm within the company for 10 years now.
Almost 17 years now.
Three years now in different roles.
36 years now, today.
The people, the culture, it feels home.
Right. Well, for those of you who are wondering whether that was me in the Japanese outfit, yes, that was me. Myriam, I mean, it seems like a happy bunch here at Randstad. We talked about specialization a lot today. How are we gonna bring that to life in our own organization? Because, of course, we need to eat our own dog food, if you will.
Yes. And all the markets are now adopting and bringing to life the specialization framework that we have shared today. In fact, specialization existed in many markets in some form. What is different now is that we are doing this at scale and with more consistency, and it infuse energy in the organization. When I talk to commercial leaders, they like it because they see the possibilities. In fact, specialization resonates with our clients because this is how they organize themselves. It aligns with the way our talent likes to talk about their career aspirations and experiences, and it helps our employees, as we have seen, because it brings clarity in career path for them. So this is how we are going to grow through specialization.
At the same time, we must capitalize on our position and size. With a presence in 39 markets, it provides an opportunity to optimize, eliminate applications, streamline processes, as well as increase productivity through leveraging the technology, as you said, Martin, and leveraging the shared service centers that we have. We have talked about the talent centers, and increasingly, likewise, we are going to leverage our global capability center to deliver functional excellence at scale. So in summary, I would say that we will strengthen our strong foundation that we already have. We will evolve to win through our specialization, and we'll take the full advantage of our size and scale. With this, ultimately, it will inspire our clients in how we attract and we grow our people through careers.
We'll measure success through profitable growth, of course, and Jorge will talk about it, but also ongoing external recognition of our progress. Here you can see a few examples. A recently received award of Top Employer leader in equity, and learning and development best practices.
I love it. I cannot say anything else. Martin, just one more thing. These days, you cannot talk to a CIO without talking about AI.
Yeah.
Can you give us an update, a brief one, on the state of the nation on AI in Randstad?
I'll be very brief. So Randstad has been using AI for a very, very long time. We mentioned search and match. We mentioned demand forecasting. We can predict, Jesús pointed out, we can predict when we will have demand, and in many, many particular applications, we use this already. What is new now to the market is large language models, which puts a language front end to all this intellect that was already there, and we've jumped on that at speed. So we've already done a pilot with the automated writing of job postings, job descriptions. Fantastic results. People now write job descriptions in 50% of the time it took, and I'm deliberately saying people write it because you always have to make sure that somebody checks what is actually written, and we do that very deliberately.
But also, we're the prime or one of the key people piloting a Duet from Google, and we have a very good relationship with them, and they've allowed us to be one of their pilot companies for that, which is an AI assistant for the people working with their Google Workspace. Nice results. It makes people basically faster, that's what it does. And we have a list of use cases that we're now going through and start expanding to embed this truly in our business. So we're going to do it with speed, we're going to do it very responsibly. We want to be able to always explain, and be able to explain why a choice was made. Why were you picked for a job and not somebody else?
It should not be a black box of a machine making decisions, and we say, "Well, we don't know." We also need to make sure there's no bias, that's clear. We want to be equitable, we want to be transparent, so bias for us is, is a place where we don't want to be. And last but not least, when we scale, we want to make sure it works at scale. And you probably have heard the stories that sometimes these tools create text that you rather would not send. At our scale, if we make those mistakes, many, many people will get strange letters. We don't need that either. So we're going to do this at speed, but, but very, very carefully, making sure every step we do in the right way, transparent, unbiased, and scalable, and then I think we're in a good place.
Does that answer to you?
Very clear. Thank you very much, Martin. Thank you very much, Myriam. I mean, it's clear that our two most important assets, people and technology, are in great hands. Thanks a lot!
Thank you.
One last asset to talk about, and that's euros. And who else than our CFO, Jorge Vazquez, can talk about-
euros
Our new growth algorithm in euros.
Euros and euros . Thank you, everyone.
Take it away, Jorge.
Thank you, Sander. I think I've met most of you over the last six months, and probably for those that I have not yet had the chance to meet, well, streaming in or looking through the stream, I am Jorge Vazquez, I am the CFO of Randstad. I've also been with Randstad for many years, 12 years, so I've been through some ups and downs in the economy, and I'm actually quite excited to be here with you. I'm excited to be here with you, especially six months after I've started. I've been an integral part of this process. We've been designing our new strategy. I've been working with Sander, I've been working with all this great team that you just met, and it's with pleasure today that I actually talk about excitement.
I'll just bring a little bit, even though I'm a CFO, I'll bring why it's this excitement. It's great to have a new strategy, and I definitely think we are onto something big. But I've been through some ups and downs in Randstad, and the company, like many of our colleagues mentioned today, it thrives on energy, and it thrives on activating 42,000 people at the moment to push more and to believe more. And what you now see with this strategy, and you heard many of my colleagues talking about several actions, we'll talk about in a minute. Every team, every in-house location I heard today, every function, every country, every unit, every consultant knows through specialization, through talent or Partner for Talent , "I can dream more, I can do more, I can grow more, I can be more productive." And that's special now for Randstad.
We are onto something big. We built this on a very strong foundation, and many of you have now followed us for 10 years, and I think it's important to talk about this. Not just to talk about the numbers, but to talk about what it means to deliver these numbers year in, year out. This is not something we do every year. We don't perform well in one year; we perform well year after year. As group controller, as I was before, sometimes you do lose a bit of hair, but you deliver. It's here. My predecessors actually have way less, way less hair. We deliver, and we deliver consistently. That's done only and, thinking not in one country, not in one business line. This is the power of Randstad. That's the foundation of Randstad.
It's 39 countries, different business lines, everyone knows what is to manage cycles, to be able to grab the opportunity, build alpha on the way up, reduce our beta on the way down. Just some numbers, numbers to put it a little bit into perspective. Revenue. Last year, we delivered EUR 27.5 billion-EUR 27.6 billion of revenue. That's 1.5 times bigger than 10 years ago. That's impressive, a CAGR of 6%. At the same time, our gross profit has actually significantly outpaced it by 8%. That is what we've been talking about in taking care about broadening our services, broadening what we do for our clients. Getting different types of business, different end-to-end solutions into Randstad on behalf of our talents, of our clients. But look at the CAGR and the impact on EBITDA.
We've doubled our EBITDA over the last 10 years. We've delivered EUR 1.3 billion EBITDA in 2022. Why is that so much bigger, perhaps, than the revenue growth would have suggested? That's the benefits of scale. That's us basically becoming better every time we grow. At the same time, free cash flow, something that we take very dear at Randstad, and I'll talk more about that in a minute or later in the-- in my delivery. We've tripled this number. From 2012, 2013 to 2022, we closed to triple our free cash flow. And this is done only not by one team, not by one company, not by one country. It's 42,000 people that know exactly what to do day in, day out. Which brings us to an important point.
We just published our Q3 results, and for many companies, we will be thinking, "Wow, we are in a down period of the cycle." We are exactly excited because we are in this down period of the cycle to be now very well positioned to benefit from the recovery. Two very important things we discussed last week when we published our numbers: We have a very strong, sound financial position. We are in a position of strength. We can make choices, always with the discipline that we just discussed, but we can make them. We can now activate and find growth where that growth exists. And speaking about growth and existing, we are now more diversified than we've ever been. 10 years ago or 12 years ago, we were a way more concentrated company in Europe.
Today, you heard from my colleagues, we are present in many more places in the world at scale. We have more than ever, companies in the group or countries that have more than EUR 1 billion of scale. We are a big player everywhere in the world. But we also have more different services. You heard Mike talking about enterprise. I'll talk to you in a minute about our different specializations. We are a stronger Randstad than we've ever been. We will find growth where the growth exists. Which brings me to our new growth algorithm, and it's very simple but very powerful to excite and energize an organization. We believe through our Partner for Talent , and I'll show you how, even though you already heard it, but I'll summarize it.
Through our Partner for Talent and through specialization, there is a lot of growth to be captured. Yes, we've been doing well in growth over the past 10 years, 4% approximately, so growing close to GDP, which many companies do not do. Growing consistently close to GDP over 10 years is in itself an achievement. 4%, the remaining to the 6% was primarily M&A. But we believe with the ambition that we have, and focusing rightly so in specialization, we can unlock a higher pace of Randstad and growth for Randstad in the next years.
At the same time, and you will see how, and you already heard bits and pieces today, we are on the verge to actually push Randstad and the productivity of Randstad that we have, to a whole new level with the tools and the ways of organizing work that we can achieve on a rollout today. But more important, and we've talked about scale, scale is critical in the industry. I'll come back to that in a minute. But the only thing we must do, is never shy away from investing and keep on fueling this growth, and keep on fueling this cycle to expand growth and expand conversion. Which brings us now to the four specializations. So we talked about it a lot today, and what we've done here is just to create the starting point.
So we looked at our businesses throughout the world, and we've been working with all our teams throughout the world and identifying what do we do today, and how can we plot it as a starting point of Randstad in its specialization journey? And you find four specializations here, as they've been described before, and two important conclusions. We are big in each one of them. We're not a beginner. We are playing at scale. We have the right to play. I think... I don't know where Venu is, but even Venu said: "Well, when I came in and I realized the scale we have, we don't have anything to envy to the top 20 IT and solution players in the world." In each one of these four platforms or four specializations, we are large. We also have a quite healthy conversion, meaning these businesses are all healthy.
I don't know where Sander is, but Sander mentioned I don't have a preference for any of my children. This is why. I wouldn't have neither. This is why. These are good businesses. All in its own right, they are delivering very good returns for Randstad. You will notice they have different revenue profiles and different business models. Some of them, as an example, enterprise, EUR 1 billion revenue, point seven billion gross profit, a very high margin. These are typically fee businesses. The businesses operational tend to have a slightly lower gross profit, but a high conversion. All of them delivering in its own right.
The exciting thing is, we can now plot growth for each one of these four, and we can now think: How are we going to position Randstad and everyone in Randstad to capture growth in each one of these four, more than ever before? There you heard a few things, but I'd just like to kind of very quickly list them to you. You've talked, we have talked a lot about specialization, so basically making sure that we have a talent strategy, making sure that we have a delivery strategy, a go-to-market strategy for each one of these four. Focus, like Sander says, but focus brings growth. By focusing and being a specialized player to each one of our talents and clients, we can aspire for growth. The second thing is, it's not only being present in the different specializations.
Inside each one of them, and I think Dominique described it well, but let's, let me tell you, we've been working with every single team on the top 10 countries to list, even now in this economic context, and projecting for the next three years, where are the talent needs and the talent scarcity requirements that we can and should now start developing, creating access to, so that we actually ride those waves of opportunity. We call them high growth segments, and that's why we're gearing a lot of organic investment towards, to make sure that we capture not only the outlook we believe possible, but hopefully even at times surpassing it, surpassing it. Because in every economic cycle, in every talent scarce market, there's significant opportunity for Randstad. Which brings us to the third point mentioned here today, which is expanding our service portfolio.
You heard Mike talking about broadening our end-to-end solutions. You heard about Venu talking about, in Randstad Digital, broadening our service lines. I don't think we talked today, but you probably know we just acquired an outsourcing company in Spain to broaden our offering on the operational side. By expanding our service portfolio, we can set Randstad to consistently grow ahead of GDP, and this is exciting for us. Let's talk about the other important component of our growth organ, algorithm: conversions, margins. Here you have, in a very simple way, how we look at our cost base in two big buckets. One important point before, it is a principle of Randstad, and it's an immutable principle, and you've seen what it has brought to us. 90% of our cost base has one single point of accountability. There's no discussion about it.
There's someone that decides. At the same time, that single point of accountability is not someone hypothetical, away from talent and away from clients. It's basically our P&L leaders, it's our businesses, it's the people that are the closest possible to our clients and to our talents. This is a, a sacred point because it enables us to, from that, being able to start cascading two points. One, on our field delivery costs, approximately 65% of our cost base is here, people doing our work every day, delivering productivity. The other, on everything that has to do with support the field, support everything we do, deliver and free up capacity. This is exciting because we've always been trying to improve productivity. We've always been trying to improve and free up capacity.
But what we're doing now differently is very clear: per specialization, trying to challenge some of the highest growth assumptions or highest productivity assumptions we've had, to beat through them and to surpass them. And you heard the examples. You heard my colleagues talking about adapting field steering for each one of our specializations. You heard my colleagues talking about talent and delivery centers. Jesús mentioned 8 countries, but we are clear, we want to be in 10 next year. We've talked about digital marketplaces. Jesús mentioned we have EUR 1 billion through revenue, let's say, going through this. The ambition for next year is to surpass EUR 2 billion. So there are actions, country by country, specialization by specialization, to roll out a productivity level that we have never been able to surpass. We've done well, but we've never surpassed it.
Which brings me to the right-hand side, which is freeing up capacity. Here you have to think that we have a new organization, and we can leverage that organization to structurally improve and free up our capacity. Think about it. We now have regional CEOs working throughout all our organizations, trying to think, given their portfolios, together with their teams in each one of our countries, "How can we improve? How can we bring everyone to the best practices of Randstad?" You also heard Myriam, I think, talking about our global delivery centers and trying to work with each one of our countries and see how can we become a more efficient, effective, functional support for our business? How can we leverage more our IT generally, but in the end as well, each one of these categories.
And what this means is that where we were primarily well-positioned to always keep pushing what we could deliver from our more fixed costs, now we have an organization that actually support us to think we can push through that limit. One last point here you see is portfolio evolution. See, one other point is, of course, in any business, we always have parts of the business that can improve. And it's also something we are steering towards, to continuously push and improve our portfolio through the cycle. Which brings me to: what does this mean? So we have, on one hand, productivity gains, on the other hand, we have freeing up capacity.
But what this means is, we've always strived to get to 5%-6%, and if you roll out, and while rolling out our specialization strategy, I'm excited because we can clearly see a path to get there, to get to 5%-6% underlying EBITDA margin, gradually getting there, but more important, staying there. Because we're creating the foundation not to deliver it once, but to actually stay there and be able to deliver it year in, year out. Which brings me to the second point, which is balancing our short-term performance with long-term investments.
Our responsibility will always be to, as much as possible, achieve performance in the year to come, but at the same time, making sure that we actually stay at that level of performance and we make the investments that we need to make to make a better Randstad for the future of tomorrow. A few examples. 2022, at scale, we were at 4.7, 4.7% EBITDA. We know we have made investments in IT that could potentially would have improved our EBITDA margin, although we said we decided to stop them. That's not a logical and that's not a good decision if we see the return we can get on them in the years to come. So we continuously have to balance the short term with the long-term choices.
Now, one thing, and one important reminder for those that follow us or know us well, we operate with a very clear definition of how good looks like. On the downturn, and you've seen it before on the first slide, on the downturn, it's very simple: we need to protect as much of, let's say, our EBITDA or as much of the gross profit to loss in EBITDA, meaning we have a 50% recovery ratio. On the upturn, we want to, as much as possible, take an uplift on that and increase it to 50%. Is it always 50%? No. That's where typically we have to make a choice between protecting short term and guaranteeing long term. But there's one thing, the company converts approximately, as you saw there, around 20%, right? 20%-25%.
One thing is for sure, every time we have an ICR, every time we are actually growing above of that, we are increasing our margins towards the 5%-6%. And that's why I'm excited, 'cause we see the path. Which makes the point of talking about investments. Here is a graph, and it's about organic growth, which is basically we name on Randstad field capacity and digital capabilities for one reason: look how successful Randstad has been, always in investing and getting ramp up our investments to make sure we capture the gross profit that we can, and we get from those investments. This is an impressive obligation. The discussions I have with almost every single team lead and our regional CEOs, "Please tell me, is there any area in the businesses that we can be investing organically? Because we need to."...
At the same time, the flip side of this is, every growth that we get is heavily dependent on FTE. Meaning a lot of the digital investments we are making is to build the scalability of Randstad that we have never been able to achieve before. And why is that? Because scale matters. And why do we need to invest? See, I'm a firm believer that scale in this business is extremely important. It's important financially because, as we just discussed, we have fixed costs. Therefore, any time you can dilute those fixed costs, we become a better player. That's not a surprise that larger players in the industry do better than smaller players. There is an advantage of scale, but they also matter for our clients and for our talents. More scale means more jobs.
More jobs means more talents. More talent means more jobs and more clients. So scale makes a difference exponentially more than what we would suggest in our business. And the third one is, as we make IT investments, the higher the scale and the more scale we have, the better it is for Randstad. Now, knowing that we know how to deploy FTE and as fast as possible, capture the gross profit or the growth that exists in the market, there is the number one priority, is to make sure that we deliver on this. Again, remind you, always with a very clear adaptability. Everyone in Randstad knows what's to be expected in terms of performance.
The second way to add scale is M&A, and there again, specialization brings something purpose, because we can now do M&A with a very clear line of sight on why we do it and to support each one of our specializations. It might be an omni-channel strategy in Randstad Operational. It might be about getting critical scale in Randstad Professional in a geography. It might be in Randstad Digital, building a capability that we can then scale globally. Or it might be in Enterprise, adding a new service to make sure that we continue on stretching our end-to-end solutions. But M&A all is done in Randstad with heavy capital allocation discipline, and is something that we pride ourselves, a sound balance sheet, an investment, a solid investment grade, let's say, comparable, and a very strong focus on ROIC.
This is the ROIC or the EVA, let's say, of Randstad over the last years. You can see consistently, period after period, how we've been increasing. Which now brings me to one important point, which is to invest, we need to generate cash. I think this is probably one of the most, let's say, exciting aspects of our industry, and at least definitely at Randstad, is the resilient part of our cash flow. Let me talk a little bit about it on some points I think are relevant. One is, if you look on the first slide, you see basically how the cash flow evolves. I've mentioned, I think in the beginning, it tripled, even though our revenue has only increased 1.5.
That's simple because on one hand, we generate more EBITDA, but it's a business that requires very low working capital to invest. So if we do our job right in managing working capital, in managing receivables, that everyone knows in the organization how to do it, we are set for a very solid growth of cash flow. The second thing is, that growth is actually, at times, not intuitive. It is fantastic on the way up because we generate more EBITDA, and therefore, that EBITDA translates into cash, but it's equally fantastic and exciting on the way down, as we just published our Q3 results last week. Which means we actually generate quite a lot of cash when we go down, if nothing else, because of the unwinding of our working capital.
And that means one thing: when we start projecting the future, we can actually have quite a line of sight into the cash flow that we're going to generate. And that cash flow, either be it through a model or a scenario with a downturn, a scenario, an upturn, it actually comes to a quite close range in what you can expect from a cash flow delivery. Which puts us in a position to talk about our capital allocation policy. And here, I think it summarizes pretty much it's the same. Nothing changes because it just fulfills and serves us very well. First, and number one priority, above all, it's my obligation, organic growth. Fund organic growth investments is the best investment Randstad can have.
We also have our dividend policy embedded in the, let's say, the capital allocation policy, and then you see our ordinary cash payout remains at 40%-50% of adjusted net income, a floor cash dividend. And then M&A, because M&A, if done with the discipline that we've done it, if done to support and purposefully to enhance our specialization, is the right thing to bring more scale and to accelerate scale, and to bring it, for further value creation for Randstad. And then again, when leverage ratio below 1, without, let's say, particularly, looking of sight of, of, bigger M&A or M&A activities, but if leverage ratio is below 1, we will consider an optional additional return to shareholders.
As you know, that can be done in two ways: a normal, ordinary cash dividend or a share buyback program. We have a current share buyback program running. Which basically allows me to summarize why I'm excited. We are on our way to basically step up in growth like we've never been. We have identified four specializations. Inside each one of these specializations, we have high growth segments, and we have basically mapped them country by country for the top 10. But more important, we are also equipping these specializations and equipping these growth segments with the right end-to-end service portfolio and expanding it where it matters. At the same time, we believe we are making significant steps towards reaching our ambition to get to 5%-6%. You heard my colleagues talking about delivery excellence and what that can mean for productivity.
You heard my colleagues talking about freeing up capacity, or at least the benefit of our new organization, and what that can mean for us to create investment capacity. We continue to improve our portfolio year by year, the parts that are not performing well. But more important, if we can fuel this and make sure we accelerate this circle, and we're doing by prioritizing organic growth, our Randstad Talent Platform and M&A. We set ourselves into a cycle of value creation we haven't been able to do until now, and it's a very exciting time to be at Randstad. Sander?
Thank you very much, Jorge, for explaining our new growth algorithm. And, before we go to Q&A, I actually want to thank you.
Thank me?
Yes.
Okay.
Because you've been a great partner for me since day one-
Likewise.
Almost.
Yeah.
But some of you may not know, Jorge was also our Chief Strategy Officer before, and he was my partner, you know, as I say, almost from day one, because I said this morning, on day one, we kicked it off with our new Polaris strategy project.
Yeah.
We've been working, you know, side by side, ever since.
Thank you.
Thank you very much. Thanks a lot, so far. We're gonna open it up for questions. Couple of rules of the game: we have quite a big group here, so we would like to ask you, limit your questions to one initially. We can go around, but we would like to give everybody an opportunity to ask questions. Not so fast.
Hans.
You see. Second, before you ask your questions, let me quickly introduce yourself, your name and the institution you work for. Hans! We have roving microphones.
Thank you, Jacomine. Yes, thank you. Hans Pluijgers, Kepler Cheuvreux. One question on... I have a lot, but I keep it to one. On the branding. So you identified four specializations. Does that mean that also all your brand names you currently use are being rebranded to those brand names? So, for example, Appel Médical goes to Randstad Professionals. Could you maybe elaborate on that, how that will work?
Yeah. So we will converge all our brands in the direction of the Randstad brand and the four sub-brands that we have presented today. And why are we doing that? Because we believe in Partner for Talent. Clients know the Randstad name, clients need all four specializations, and talent will be able to identify, you know, their entrance into Randstad through those sub-brands. So the convergence will happen over time in terms of the branding. Yes?
Maybe one follow-up on that, because in the past, you had, let's say, Randstad Professional. It's already existing for quite some time. What have you learned from that experience from the past, let's say, 20 years ago, when Randstad Professionals was created?
Well, I wasn't at Randstad 20 years ago, so I'm not sure what are the learnings were there. But I can tell you, because this is really important, because I'm sure that wasn't done at scale-
Yeah
A nd it wasn't done throughout. So if you go for a strategy, we say one brand name, Partner for Talent, you need to go all the way. You cannot go halfway. You cannot say, in this country, we do that. In that country, we do that. No. So we're gonna, we're gonna move forward in, in lockstep in all our countries.
Well, I was not 20 years ago, but spot on scale. I mean, if you look at Randstad Professionals in France, Randstad Professionals was Expectra, was Expectra and Appel Médical. Very clear focus, clear market leaders. In the Netherlands, you know the brand very well. So every time we decided to focus and actually get at scale, we were very successful. In many countries, we were just subscale in our offerings.
Hi, it's Andy Grobler from BNP Paribas.
Hi, Andy.
Just one on margins for Jorge, on margins, if I may. To get to that five-
He's just having a glass of water.
Yeah. Thank you.
I'll take my time. 5%-6%-
Yeah
T arget, which you've, Randstad has had for a while.
Yeah.
Kind of what do you need in terms of either time or the economy to get there? And if I can add on one little one, you said you could get there and stay there-
Yeah
W hich seems peculiar for quite a cyclical business.
Yeah.
How would you stay there through cycle?
Yeah, we do have to assume, and it obviously a normal cycle to return and then just an upturn in the cycle. I mean, the economies at the moment, as you see, are quite down. I think assuming that the cycle returns and is normal, a couple of years, I mean, that we can't obviously now predict, and we're sustainably there. We continue on balancing short term with long term, and what I mean by staying there is, you've seen some of the productivity improvements that my colleagues talked about. These are big at Randstad. These are basically changing the way we work, changing the way we achieve our, or we believe our good looks like in our operations, both for our clients, but also for our own operations. In retrospect, it does set us there, yes.
Okay. Thank you.
Thank you. It's, Konrad Zomer, ABN AMRO, Oddo. One question on scalability and efficiency. If you focus more on your specialized part of the service offering, your field steering and your scale is not as, let's say, efficient as it might be in what you now call operational. Do you not think that's going to hinder you initially in getting the scale and efficiency of being the biggest Partner for Talent worldwide, so to speak?
No. Let me tell you why. Because the delivery is different for each of the specializations. Yeah, in operational, it's about large numbers, large numbers of shifts, big clients with big groups of people. That's a different different model than in professional, where it's about smaller number of people, more specialized people, no real shifts, longer terms. Which is again. Oh, sorry, Jorge.
No.
Again, a different delivery model than in digital, where it's about local delivery but also about global delivery. So each of those delivery models, and I think Jesús did a very good job in terms of explaining that, are different, so they need to be optimized in a different way. The field steering principles, in terms of, you know, we're growing our business, we can add people to the business to grow further, they will be in place, but they have different metrics in different businesses. So by specialization, we will also specialize the delivery and do a better job there for our clients and for our talents.
That's clear, and I understand that. But my point is, you will benefit from less scale and efficiency in a healthcare business in Spain than you currently do in a logistics business in North America. So if you focus-
That-
more on specialization, and that becomes a bigger proportion of your overall revenue base. I can imagine that initially, before you've created scale and size in those specialized areas, it might have a negative impact on your efficiency initially.
Yeah, but...
No, let's say, if we need to invest, we will invest to scale. Yes? So we're not just gonna invest in healthcare everywhere and see what happens. No, we're gonna invest in healthcare, as an example, to create a scale position in a certain market. That is the name of the game. Focus and scale are the two principles that we will use. Yeah?
Thank you.
Oh, you. Yeah.
Thank you. Can I just say something? 'Cause... Sorry, I'm gonna go back to Andy, 'cause I'm not sure whether I answered the question, or at least you heard me well on the presentation. Last year, we were at 4.7% EBITDA. That's 30 basis points away from 5%. I believe we could have been there. We could have definitely delivered 5% yesterday, and that's why I mean... Yesterday, sorry, last year. It is important not to be able just to do it one year, it's important to set up the company to do it year after year. We've been increasing IT investments, and we have ongoing IT investments, as we just, I think, Martin, highlighted.
We also have parts of the business or parts of our portfolio, namely Monster, as an example, that are less performing or are not performing yet on breakeven standards. Would we have corrected for those things? And we'll be at 5%. What excites me is not to be one time at 5%. What excites me is set up the company to be between 5% and 6% consistently, because our operations are performing at a level that can consistently deliver that level. And that is important, because it is not necessarily about getting there, it's about sustaining it there. Yeah?
And that's why we say there is still a need, to kind of balance short-term investments with long-term ambition of getting to 5%-6%, 'cause if that supports staying there for the next few years, that's the right thing for us to do for Randstad. Yeah.
Here, in the middle.
Thank you. Good afternoon. It's Rory McKenzie from UBS. You've spoken a lot about talent scarcity, but you haven't mentioned much on wage inflation and fee rate changes over the past few years. I think that by the end of this financial year, price mix, whatever you wanna call it, could have added more than 20% to gross profit over the past three years, so much more than volumes in what's been quite unprecedented markets, really. Is it fair to say that wage inflation will slow from here? Do you think you can further expand fee rates? And within each specialism now, do you aim to expand your gross margin in each segment, or is it just the conversion margin you think you can control? Thank you.
Let me say a few things about wage inflation, because wage inflation is already coming down from where it was. It's now lower in the U.S. than in Europe. In the U.S., it's on average 2%. In Europe, it's in most countries 4%, with some at the 6% range, and France on the lower end of the spectrum in 2%. Jorge, maybe you comment on the pricing and the gross-
Yeah
G ross margins.
Rory, I think in terms of pricing, I mean, you've seen what we've done over the last 2, 3 years. So the ability to make sure we price, and I think we even mentioned dynamic pricing, 'cause there's quite a lot of programs in Randstad for that, are there. Now, do we celebrate gross margin alone? No. Ultimately, it's about scale, and scale comes through EBITDA. So if we feel at a certain moment in time that a certain price level, at that level, we can deliver, exactly like Jesús and Venu explained, through these new delivery models, to get that revenue and convert at the level that we need, generating the investment we need, that's fine, we will do it. So yeah. In terms of wage inflation, Sander just mentioned, but yeah, nothing to add.
Thank you.
Wait, wait, Hans. Yeah, yeah.
Hans is so excited today. I mean, you really, get up, no?
Yeah.
Sorry, Hans.
Marc.
Zwartsenburg, ING.
Marc.
Again, going back to your margin, yeah, ambition of 5%-6%, and, like Andy said, it's been there for a while, and talking about-
Yeah.
S cale, about digital marketplaces, et cetera. Was there a discussion to maybe stretch the range from 5-7, still acknowledging a bit of cyclicality in the business, that you stretch the higher end of the business? 'Cause if I say, by the sound of it, you will be more specialized, more professional-
Yeah
M ore fee-driven, et cetera.
If you look at each one of the specializations, there will be room to say, "We can aspire one day definitely to be there." So it will depend heavily on how we evolve our portfolio and the growth we capture. It is not unthinkable to get to a broader range in terms of EBITDA. My main priority is to at least go to 5% first, to then start dreaming about a higher level. It does require investments, yes, but again, I think you saw the discipline we have in investments. It's very limited working capital, so it's about investing in salaries. We typically have a ramp-up period, I mean, you know us very well, of 6-9 months.
So even if we were to now start building scale in some of our specializations at a granular level, we have a very clear line of sight of what to get in 6-9 months, so it does not even cross over the line of 12 months. That's why I'm with confidence that with the scale of growth and investment that come, we can aspire to get to the 5%, and we are cascading that in the organization.
Maybe a quick one on M&A.
Well, maybe, but you do your quick one later. Yeah, no, we have set some rules. I love you to death, Marc, but now we're gonna wait-
Suhasini.
We're gonna, we're gonna move here.
Be harsher in the second question now, eh?
Suhasini. Yeah, yeah.
Yeah, yeah. I'm sure someone will ask-
Yeah
A question on M&A, and otherwise, we'll take yours, your question as the last one. After Hans, of course.
Thank you. Hi, good evening. Suhasini from Goldman Sachs. It's a bit of. Maybe, just to get some clarity on what you think faster growth versus future should be-
Mm-hmm
V ersus the history should be.
Yeah.
It was 4% organic-
Yeah
I n the last 10 years. One chart said GDP plus, plus growth-
Yeah
I think, in one of the slides.
Yeah.
Is it like we should be looking at 6+, 7+, 8+?
Yeah.
Because there's definitely scope for double-digit growth in many-
Yeah
O f your areas-
Yeah
A nd as it specialize.
The first challenge I set to the team is at least 1% ahead of, or 100 basis points ahead of GDP. So detached from the Randstad that is growing 4% consistently... I mean, this is a CAGR of 10 years. Detach from that and show that we can find the pockets and find the growth, which we have mapped out, to detach to 5%, so 1% more above GDP. Again, if we are getting exposure, significant exposure, to... You remember, to the middle ones, where you have significant higher growth, 7%-10% growth, then, yeah, we will not be satisfied with 1% ahead of GDP. But the first point is detach from what is already good, but get even better. Yeah.
Thank you.
Unlock that for Randstad.
Hi, it's Kean Marden from Jefferies. Would you mind taking some time to help us understand the, the matrix? So you have a growth strategy built around specialisms, a reporting structure, presumably some part of the organizational structure built geographically. How do you manage the matrix, effectively and without introducing any, wanted cost headwinds in the organization?
Yeah, very, very good question. And indeed, you know, in any type of structure, you always need to be making sure that you don't add nodes and therefore costs. So Operational and Professional specializations will be run through our markets as they are today, so no, no change there. Enterprise was already run on a global basis, particularly focused on what we call the M1 markets, our top ten countries. So that's already a global P&L. The change that we have now made is for those M1 markets, the top ten markets, we have now put the digital businesses under one P&L as well.
But we also believe in collaboration, so in every market, the leadership team, on the big table in Germany, there will be the operational and the professional leaders, but there will also be, to make sure that there's collaboration, the digital and the enterprise leaders. So that is how we're gonna ensure collaboration, and we're not adding any nodes whatsoever, I would say. Yeah. Oh, well, we go there first, and then we come to you. I so... The microphone was so close there.
Thanks. It's Will Kirkness from Société Générale. Just a quick clarification: did Jesús say digital marketplaces are EUR 1 billion now and go to-
Yeah
EUR 2 billion in 12 months?
Two billion.
Okay, thanks. And, so my question was just around the, some of the digital tools. You spoke about the uplift to productivity. Have you got any stats on what it does for talent retention?
Absolutely, yeah. Yeah.
Yeah, we can ask Jesús to give some stats on the digital marketplace in North America, but maybe it's better if you connect with him directly.
Sure.
I mean, clearly, the stats you have to think about is, you know, talents stick longer with us. They pick their own shifts. They do more shifts. They show up, so the fulfillment ratios go up. So there's benefits in the round in those digital marketplaces.
Thanks.
Maarten Verbeek, half my question has already been answered concerning the organic revenue growth, but also with the acquisitive organic growth.
Yeah.
You showed that your free cash flow is growing faster than revenue and EBITDA growth-
Yeah
S o you have more money to spend, and also you want to specialize more. Can we also expect more acquisitions to be made in future? And-
Um-
Acquiring more specialized companies, that obviously also means another price tag for those acquisitions. Does it also ha-
Yeah
W ill have an impact on your return to be made?
Yeah. I mean, first of all, of course, as we generate more cash flow, and you've seen we have not changed our dividend policy or our capital cushion policy, we are in a position to spend more. But, I mean, we've been in a position to spend, I think, for many years at least. So that is not per se a need or a reason to do something. We are quite, let's say the bar is quite high at Randstad, because it's about basically acquiring something and being able to scale it, being able to get the synergies we want to get, growth or cost. We've mentioned before in the past, yeah, EUR 300 million-EUR 400 million per year. We haven't even been doing that over the years. Might it rise a little bit?
Well, we have the ability to do it and still comply fully with our capital allocation policy and, and capital discipline. But remember, I mean, it is ultimately about strategic fit, so specialization. I mean, this is basically the model we use internally. It's about value creation, fit. Can we really see a clear path for value creation? And it's about manageability. So a lot of the businesses we acquire are people businesses. Can we make them grow faster or get the synergies from these businesses? That discipline is there, hopefully now and not... We're looking at it much more from a specialization perspective, just to basically reinforce the strategy. But like, it's hard to tell if we're going to be doing sim-- We don't plan any major acquisitions.
We're looking at it from a lens of specialization, and we keep doing exactly like we've been doing. We just acquired one, by the way, in Spain, Grupo CTC. Yeah, it's a good example, one by one. Dominique?
Yeah. Hello, it's Dominic Edridge from Deutsche Bank. Just a question on technology and how that relates to what's going on in the industry. It's been very easy to say: well, technology, the smaller players won't be able to invest as much, therefore, that will drive a lot more consolidation. It hasn't really seemed to happen in that way. Do you see this latest stage of technology changing things, or should we just see it more as it adds a bit to your organic growth? It adds, obviously, gives you productivity gains, but actually, in terms of changing the industry, fundamentally, it's really not going to do a huge amount in that respect.
Well, a couple of, a couple of thoughts there. When I came into this industry, I was actually surprised by the relatively low penetration of technologies in the business in general. And, there is no Amazon in our industry. Took Amazon also 25 years to become the Amazon that they are, that they are today. However, we do see some of the digital players getting to a scale, a scale of EUR 500 million, some EUR 1 billion. And my point is, if one of our competitors can do EUR 1 billion on, in, in a digital way on a platform, they can also do 10, 20, 30, because it's scalable. So that... So the, the good news is the penetration is relatively low. The other side of the news is we really need to step it up as Randstad to become a serious digital player as well.
And that's why, Jesús mentioned, you know, we're doing a little shy of EUR 1 billion today. You know, we really want to step that up to EUR 2 billion over the next 12 months. So we're going to go full throttle ahead because I believe digital is here to stay, and it's not going to go away. The very important distinction that we have, and I think Jesús did a very good job in terms of bringing it home, is the omni-channel. We're not just a pure digital model. No, we have the different channels, the accounts, the branches, and digital. To deliver, we have the different channels, to source, we have the different channels.
We are strong believer in those channels working together to bring the best outcome to a specific situation, whether that's the banks in Spain or the retail in Italy or the healthcare in France. But I think digital is here to stay, and we need to go, you know, full throttle to make Randstad the leading digital player. Hans?
Yeah, sorry.
Yes, Hans Pluijgers again. Coming back on the margin target, or follow up on Andy's question. You indicated already that in principle, you could have been at the 5%-
Yeah
L ast year.
Yeah.
Same time, you say you want to have it, more or less, sustainable.
Yeah.
You provide on page 75, let's say, a breakdown of your revenues by specialization.
Yeah.
Let's say, to get that sustainable, do you need any material change in that breakdown? So could you maybe give some feeling on how do you-
No
S ee that going forward, or do you only see it coming from, let's say, efficiency improvements and cost savings? Secondly, on that, does it also maybe, because you provided, let's say, insights on which, let's say, segments you focus within those specializations?
Yeah
D oes it also mean that maybe some activities will be de-emphasized?
Yes. But let me first start with the first one. When we look at four specializations as a starting point, and when we say we can see ourselves through what we're doing in finding growth in each one of them and finding productivity gains, offering up capacity on each one of them, it's in that starting point, that set three variables, that we believe we can get to 5%. Of course, and I think someone asked the question, but what would happen if you start literally growing much faster in North West, growing much faster in one of the segments? Yeah, there is a potential to discuss about broadening the range. But as it stands, the productivity gains and the growth segments we're identifying make us believe that we can make sustainable and basically get to 5% over the cycle.
When I talked about how many years... I mean, let's be realistic. One year ago, we were a EUR 27.6 billion company. At that scale, we were this close already, or even there, I would dare to say. If we had reduced a little bit of IT investments, sacrificing some of the things you heard today on the Randstad platform or talent platform, or have done already an improvement to the level we were aspired to have in some of our businesses, we would have been there already. So would we get back to that scale as fast as possible? And we're doing everything we can to get there, then we are there. Yeah.
But yeah, I'm, I mean sustainable. So-
Yeah
O f course, in a downturn, you then will drop again below the 5%. So how, let's say, what-
What will drop below the 5%?
In a downturn.
In a downturn. Yeah. Yeah.
How can you... Let's say, do you need any change in your breakdown of revenues to remain sustainable within the 5%-6%?
It helps, obviously, if we get growth in business or specializations that show more resilience. Techno-digital is one of them. Even parts of our enterprise portfolio is more resilient. Again, Hans, the first point is to get to 5% through a lot of the rollouts we have on productivity. Yeah.
And on the emphasizing of activities, is that also maybe on the-
No, I mean, well, you can talk about-
No. Well, let's say, I said I love all specializations equally. If there are parts of the portfolio in any of our businesses, be it a country, be it in subset of services, being a subset of clients, then we need to work on to improve the productivity of the profitability. We will do, as you have seen, that happen in Germany over the past 12 months. They got on the case, they grew the profitability from what was always below 3, and last quarter it was 5. So those types of actions, we will of course take-
Yeah.
O n a continuous basis.
But Hans, if your point is, I think if I understood correctly, your growth segments, are we deprioritizing something in each one of the specializations? Yes. I mean, you know, field steering, we know how we operate. We've adjusted almost 9% of our FTE over the last twelve months. What we're also doing now is basically redirecting FTE to areas where we believe there's growth. That's just a normal hands-on field steering. So yes, if we don't see enough opportunity for growth in certain areas of focus, we prioritize the resources to these particular high growth segments, we call it.
There's nothing really, let's say, in the cards at the moment on that?
There's nothing in the cards?
Really, really already clear that you have to de-emphasize on certain operations at the moment.
We are rolling this out now.
Rolling it out.
So, yeah.
But give some feeling on that, what?
Okay, now I get it. Yeah. Sorry. Okay. Yeah. I mean, you heard some of my colleagues, Dominique Hermans, talking about this as well. We have investment plans in Japan. I mean, we know where we want to put our organic growth investments, per country, per specialization, and per profile, exactly, that we want to invest. Yeah. Would we do it all at the Big Bang in one go? No, but again, you've seen how it works at Randstad. If we deploy, we have 6-9 months to get people at productivity. It's with that same discipline that we're gonna make. Will we make it all in one day? No, but if you hire the first 1,000, 2,000 people, then it gives you confidence that if you get the gross profit, we can keep on investing.
That's the discipline we want to go.
Yeah, we promised we would go to Marc after Hans.
So, okay.
We have time for one... Well, let's say two more, and then we'll,
Yeah.
Oh, okay. Let's say three more, and then we'll wrap it up.
Okay, mate, this, this one is for Jorge. On your capital allocation policy-
Yeah.
W ith a 5%-6% margin, with the revenue path that you're projecting here, your cash flow will be well over EUR 1 billion. Three, four hundred million of acquisition, we didn't make it. Maybe we get there, but still, there's plenty of money left, even after dividend payout. So why is it still optional that we have either a share buyback or a special dividend? Why are you more strict, like, it's one times leverage ratio, everything below that is paid out as a special dividend or a share buyback? And within that choice, is it a share buyback or is it more special dividend? What, what will determine the quantity?
On the last one, it's, I mean, we cross that bridge when we get there, Marc. I mean, the world is changing, and you know it yourself from the Netherlands. On basically how share buybacks are treated versus a normal cash dividend, if we are in a position to issue an optional to basically make a special dividend, we will basically communicate on time. We have a running share buyback program, and so that is ongoing. On the first one, yes, I recognize that. At the same time, it is a capital allocation policy made with a clear purpose: protect the interest of Randstad in the long term.
If there's logical M&A to be done, we will be doing M&A with a very clear policy on a very clear discipline on what we want to achieve from that. But we don't shy away from looking at things and think: Can we create value and reinforce our value, our specialization strategy to it? In the future, will we, will we adapt it? Potentially, but I mean, 40%-50% guarantees a quite good yield in terms of what we generate into our shareholders. We take it from then year by year on the opportunities and the context we are operating.
Yeah, I recognize and hear what you say, but the M&A, if it's there and you go over the 1 times, the policy is still clear-
Yeah.
T hen it's not there. So you will be consistently generating cash flow. So from a financial health position, why is it then still an optional? That was more-
Look, it just serves us well. I mean, not long ago, 2009 to 2010, and then slightly after, 2011 to 2012, when things turn in the cycle quickly, they can turn very quickly, and we just like to operate with a sound financial position. I mean, comparable to a solid investment grade, gives us the comfort that we can always look at the upside, and we can always look at the downside. Barring that it's a fantastic event, and then we can see no signs of clouds at all on the horizon. Yeah, we can consider it. I mean, it's not... We don't fix our leverage ratio at one, as you know.
I mean, it can go up to 1.5, 1.75, whatever it makes sense, if we find the right targets to acquire and the right reasons to do it. But in that context, changing it, it also doesn't make sense. It gives us comfort and peace of mind to look at the company just with a controlled, sound financial position. Yeah.
I'll leave the last question for Andy.
No, we have the last question.
And then... No, no. Yeah.
The question before last.
Yeah.
Yeah, just a bit of clarification on the digital marketplaces.
Yeah.
So a couple of things. In terms of margins and gross margins, how do those sit relative to the broader business? And when you're looking about doubling that business over the next 12 months, is that cannibalizing or taking from existing business, or is that all new, new work?
Well, a couple of thoughts. Is it cannibalizing from existing business? We are putting existing business on those digital marketplaces, and clients love it. Talent love it. We've just added, I think Jesús said last week, we have added 15 of our in-house clients on the digital marketplace in North America. The talents are already on it before you know it. The clients take a little longer, but it's clearly a model, it's a model that works. In terms of the margins on the digital marketplaces, you know, that obviously depends on the type of business you're in. On the healthcare digital marketplace, it's a different type of business than on operational digital marketplace, which is, again, a different type of business than on the educational type of business.
This is not a pricing or margin game; this is a value add game. This is making talents happier, making clients happier, fulfillment higher. That is the name, the name of the game. It's not, "Okay, now we have a digital model, let's undercut the price." So I'm not at all concerned about the margins on those digital marketplaces because it's ultimately a better service for client, especially, and I found the educational example in Australia a very good one, where we have a combination of the two. 95% goes digital, and the last 4.9% is, if I understand it correctly, you know, is by manual intervention. So it's not a margin, it's not a margin game. It's ma...
It's providing a better service than anyone else in the market, and therefore it's growing faster, I would say, even at a higher margin.
But for the operational side-
Yeah.
which I guess is gonna have to be the bulk of it.
Yeah.
'Cause-
Yeah.
Australian education's never gonna get you to EUR 2 billion in revenues.
Yeah.
If you look at the competition in that area, they have, you know, low double-digit gross margins, not a lot of profitability. You know, how are you going to be generating-
We're rolling out in businesses and in clients that do not have low single- low middle-digit margins. That's point number one, so we don't see necessarily a pricing fight for the business that we are transferring, let's say, the example of Sander. And, I mean, you know the industry very well. You have to imagine, like, the productivity we can gain, and I would prefer not to put the numbers, but just imagine employees working per FTE, one of the key metrics we always use, right? So how many people can one FTE of our support? When we do this digitally, it is significantly higher, and that is the excitement of being able to transfer. Now, are we reducing completely our people? No.
We're just basically trying to decouple GP from the FTE line. That is showing upside enough for us to transfer a lot of our business towards it. The next year, our goal is to double it already to EUR 2 billion. We'll talk once we get there. Yeah.
Okay. Thank you.
Yeah. Last question?
Hi, thank you. Suhasini again from Goldman Sachs. This is about Randstad Digital that Venu talked about.
Yeah.
How do you see Randstad positioned versus the traditional IT services players? Are you effectively going head-to-head with them, and if so, what is your point of differentiation?
No, I think we're not gonna be an Accenture or a TCS. What Venu was very clear about is we are a talent enablement partner. That means we come at it from the talent side. Our models are about complementing client teams with talent, either on-site or in global delivery centers, and while doing that, we can increasingly take more responsibility for projects. That's the nature of the strategy. So we come at it from a different angle.
Thank you.
All right. With that, first of all, thank you very much for joining us today. We really appreciate you coming. Before I'm gonna let you go and show the video, I just want to remind you of the key takeaways for this afternoon. Randstad has defined a new and exciting vision that sets the right tone and direction for the company, and that's to be the world's most specialized and equitable talent company. The combination of the strongest possible foundation that we have with our new strategy, Partner for Talent, of which specialization is a key pillar, and an outstanding team, and I'm sure you all understand why I was eager to have them all on the stage here this afternoon. I mean, they're the best in the industry.
The combination of those four factors will result in a new growth algorithm, driving higher growth and higher profitability at the scale that only Randstad can do in this industry. Let's roll the video.
Ten, nine, eight, seven, six, five, four, three, two, one. In the tapestry of life, wisdom reminds us that our thoughts hold the key to our destiny. From thoughts, words emerge, setting the course for our aspirations. Words become actions, breathing life into dreams. Actions transform into habits, forging a culture of unity. These habits define character, the essence of our being, and within each character lies a unique talent. At Randstad, we believe in the power of nurturing talent. Together, we move towards a better tomorrow, where every talent is recognized and cultivated. With our clients, we create an environment where talent thrives. Our journey is one of growth, unity, and the realization of boundless potential. Join us on this exciting voyage, where together, we empower and amplify every talent for a brighter future. Randstad: Partner for Talent.
Thank you once again. Now, join us on an exciting voyage right around the corner here for some drinks and snacks. Thank you!