Helmut Neumann International anchored its business in Slovakia in 1992 to help stabilize the country's shaken base of business executives, when the socialist-style manager was crumbling away and a new one hadn't been molded yet.
Founded in 1971, the firm currently ranks atop all recruitment agencies in terms of executive placements in central and eastern Europe, while ranking second in Europe and sixth in the world, according to Marta Kubinská, H. Neumann partner in Bratislava.
Although the Slovak branch initially provided services mostly to the Neumann Group's international clients, Kubinská explained that since 1993 the annual increase in the number of clients has been between 60 and 70 percent. Today, the company serves around 70 regular clients.
Recently, H. Neumann filled 150 openings for Globtel, a new mobile phone network provider. Last year, the company did personnel audits of about 600 employees of Slovenský Plynárenský Priemysel (Slovak Gas Industry).
As Kubinská said, the work for the SPP was exceptional because domestic companies still mostly rely on their own resources for recruitment and personnel policy. However, she said that the trend towards externalized services is irreversible, and sooner or later Slovak companies will start allocating funds for specialists rather than keep personnel and financial resources tied up for often less effective in-house activities.
Kubinská cited the relatively low level of foreign investment and slow privatization as H. Neumann's main limitations in Slovakia. "As for other aspects," Kubinská said "we feel confident that the business will grow. Generally, the demand for staff and managers is high, as well as for consulting services."
The importance of individual consultants is underscored in the H. Neumann group by the fact that recently 30 percent of shares were passed to 150 consultants. Another 21 percent was offered as an option to partners, giving employees majority in Helmut Neumann Holding.
Creating a favorable image among the public is as important as having a good name among professionals, according to Kubinská. "At the very beginning," she said, "while we were still a newcomer to this market we had problems attracting candidates, especially for executive searches. The fact that we were able to overcome this problem soon and establish ourselves as a trustworthy partner probably gave us an edge over the competition."
When asked about expansion to regions of Slovakia outside Bratislava, Kubinská said, "Of course, we do some placements outside the capital, but the majority of our services is [still] provided to companies based in Bratislava." The Bratislava office has seven consultants and six administrative employees, all of them Slovak.
A consultant from a rival company confirmed that to be successful, one needs "internal references." Douglas Stewart, head of Personnel Select's Bratislava office, said, "That is, information that you don't get from a person's CV. It is therefore good to have Slovak consultants hiring employees, as the communication is much easier, and it is possible to use informal information networks."
Another illustration is Dr. Ostertág, a company that is currently the biggest job advertiser. Its owner, Peter Ostertág, said it is especially necessary to have native specialists for personnel audits and trainings. "Recruitment is often just a routine," he said. "But for the real consulting work you need to have real specialists. Of course, because of detailed communication, these cannot be expatriates."
That may be one reason why purely domestic companies, such as Management Partners Group, are able to catch up with multi-national agencies and establish themselves on the market.
H. Neumann Group At a Glance (1996 figures):
Consolidated pre-tax profit:$1.6 mil.
Consolidated profit after taxation: $420,000
Consolidated turnover: $48.5 mil.
No. of branches worldwide: 49
No. of consultants: 150
