‘Many Americans spend their whole life never going outside the US. But living in London, the rest of the world is so close. It’s very exciting,’ says Bill Grubbs, chairman of IT personnel and MD of workforce management solutions at Spring Group.

Grubbs’ international perspective comes from early exposure to foreign lands. Born in Andover, Massachusetts, his early life included six years in Saudi Arabia and a year in Lebanon, before returning to the US to finish high school and gain a degree in computer science from the University of New Hampshire. After graduating, Grubbs personified the American dream - he bought a fast food restaurant, Dairy Queen, the company he had worked part-time in for years.

Five years on, with a chain of five restaurants, Grubbs decided to try his hand in what he calls ‘the real business world’. His IT background and business acumen led him to answer an ad in the paper for a technical recruiter at TAC Worldwide. Through a 14-year tenure at the company, Grubbs worked his way up through the ranks, including a brief stint in the UK, to become vice-president, international operations.

In 1998, Grubbs was headhunted by Harvey Nash to become MD of the IT contracts division. Only seven months later he was offered a job he couldn’t refuse in a recruitment company in Salem, New Hampshire, home to his family (eight brothers and sisters) and his original Dairy Queen business.

As head of IT staffing at TRS Staffing Solutions, Grubbs was soon promoted to president and CEO. But 20 months later he was ‘disillusioned’. The management of the Fluor Corporation, the engineering and business services company which owned TRS, was holding the company back, says Grubbs: ‘I didn’t feel that TRS was going to be allowed to grow and expand in the long term as I wanted it to. The direction and investment that Fluor was willing to put in was insufficient to make it a larger player.’

Despite his mild-mannered exterior and soft accent, Grubbs is a determined man who likes growth and knows how to command it. So when he hooked up with some old contacts on a golfing trip to the UK with his family last year, it was perhaps unsurprising that he ended up with another job offer. In October 2000, Grubbs crossed the Atlantic once again to take up his new job at Spring.

The American way

So how does recruitment in the UK differ from across the Atlantic? ‘It was quite a steep learning curve when I first came over to the UK - things work very differently here.’ UK employment law is totally different, for example: ‘Employees in America are employees at will - there is no contract of employment and they can get rid of you basically at any time they want. The labour laws alone make recruiting a very different process.’

More fundamentally, cooperation between staffing companies is an established business trend in America, Grubbs explains: ‘Business in America has become very tiered. A client has a number of preferred staffing suppliers, but below these there is usually a second and third tier of suppliers to those companies. The candidate shortage has been such that companies have wanted access to a wider range of suppliers, but didn’t want relations with them.’ Each company along the chain takes a cut, but initial margins are often double those in the UK, says Grubbs.

In line with market intelligence, Grubbs agrees that trends in recruitment tend to originate in the US before making their way across the pond. Managed service programmes, where an agency manages contractors or temps on site, are only just starting to make an impact here, but already account for 15% of American staffing revenues, for example. UK companies have also been slow to implement the preferred supplier lists which were becoming commonplace in the US by the late 80s.

Even IR35 hit first in the US - American contractors were hit by a version of the controversial tax in the 80s. ‘There was the same uproar there as there has been here - whole organisations were set up to fight it.’ Grubbs recalls that the US staffing industry emerged largely unhurt - comforting news for those recruiters who fear the effect IR35 may have on their business.

As for his personal experience of the US/UK as places to work, Grubbs says: ‘When I first started in the recruitment business 17 years ago, we worked almost every evening and every Saturday from 9am-12pm. You don’t tend to see a lot of that here.’ Americans are also more serious, he claims: ‘Office dynamics are very different here - in London I find people have a much more fun-loving attitude. Colleagues want to go out and have drinks together or go on a trip together. That’s not so common in the States.’

So what is life like as an American in London? ‘I was a bit worried about how I’d be perceived when I first got here, particularly as an American working in a British company,’ he confesses. ‘But I have had no problems. I love it here.’

The new world

If most trends in recruitment originate in the US, Spring Group is preparing to buck that trend by opening a new office in Chicago. While Grubbs is not part of the official team launching the American operation, his experience in the market has given him a key role as unofficial adviser.

A year ago, Spring’s CEO Jon Chait announced his plans for expansion into America. At the time, it made sense. Now all we hear from the US is doom and gloom. ‘The downturn in the US has certainly been much more significant than in the UK - it hit sooner and it hit harder,’ says Grubbs. ‘Not that it won’t come here. There has been an impact, but it doesn’t seem to have hit as hard as it has in the US.’

So why is Spring going ahead with the expansion? ‘At $72-75bn, it’s the largest market in the world.’ To Grubbs, the US downturn is ‘just a blip’ - it will ‘come back again soon’, he asserts.

Spring isn’t too worried about starting at the bottom. ‘You have to start somewhere, and the Spring team already has a lot of experience in the US market.’ In the US, Spring will be enacting more of a ‘technology-based staffing solution’ than the traditional staffing service: ‘Chances are that for a period of time we will be a small player, but the market is big enough for us to make an impact. I think we stand a chance of competing with the big players in the US.’

Beyond the risk involved in venturing onto new turf, there are also benefits. ‘There are higher margins and higher net profit numbers in the US,’ says Grubbs. ‘And we need the diversity of being in more than one economy, rather than just the UK.’

Spring cleaning

A lot of people will be watching Spring as it launches the next phase of its business timetable, of which the American expansion is only a part. For over a year, Spring has been losing money. Its shares fell from 150p last July to a low of 43p in April this year.

But things are now going according to plan, claims Grubbs. Jon Chait’s arrival in May last year was the occasion for a total management reshuffle. Despite a new board, the company still has to live with some of the legacy of the old one - in the past, Spring did not deliver on all its financial promises. But that has all changed: ‘Shareholders are going to be cautious given the current economic situation, but things here at Spring are right on track.’

In December the company disposed of two arms of its non-core business: Spring Education and Spring Skills, for the sum of £72m. ‘We sold at the right time - we would not have got that price if we had waited a few months,’ Grubbs admits.

The sale was based on Spring’s decision to ‘focus’ on its core business, Grubbs insists. This streamlining has also involved some ‘restructuring’, as Grubbs calls it. Compared to redundancies in other recruitment companies recently, Spring’s probably number only in the tens rather than the 100s - ‘not significant numbers’, according to Grubbs. But will there be more? ‘There may be some additional restructuring, yes, over the next couple of months.’

While Spring is slimming in some spheres, it is preparing for a feast in the future. A key aspect of the Chait ‘vision’ that has yet to be realised is acquisition. ‘We have a number of things in the pipeline,’ confides Grubbs, who refuses to be drawn much further. The company is looking predominantly at the IT market, but ‘would not rule out acquiring in another professional sector that is high margin and high growth.’ The company has an outside agent and an internal mergers and acquisitions specialist hunting opportunities in both the UK and US.

Recession is the buyer’s friend, as any businessperson knows. And Spring has money in its coffers from the earlier sell-off. Yet Grubbs is ‘cautiously optimistic’ that the downturn is going to be over soon. Watch this space.