Recruitment Process Outsourcing (RPO) is becoming more and more widely used as organisations experience rapid change and exceptional growth, particularly in the technology and online sectors. Flexibility and scalability are critical to any business, and RPO gives companies a solution to ever-changing hiring demands.
The Recruitment Process Outsourcing Association defines RPO as follows: "When a provider acts as a company's internal recruitment function for a portion or all of its jobs. RPO providers manage the entire recruiting/hiring process from job profiling through the onboarding of the new hire, including staff, technology, method and reporting. A properly managed RPO will improve a company's time to hire, increase the quality of the candidate pool, provide verifiable metrics, reduce cost and improve HR compliance."
The biggest distinction between RPO and other types of staffing is Process. In RPO, the service provider assumes ownership of the process, while in other types of staffing the service provider is part of a process controlled by the organisation buying their services. RPO Providers work seamlessly alongside HR to provide a high-volume solution to staffing.
The RPO Alliance, a group of the Human Resources Outsourcing Association (HROA), approved this definition in February 2009: "Recruitment Process Outsourcing (RPO) is a form of business process outsourcing (BPO) where an employer transfers all or part of its recruitment processes to an external service provider. An RPO provider can provide its own or may assume the company's staff, technology, methodologies and reporting.”
In all cases, RPO differs greatly from providers such as staffing agencies which provide contingent/retained in that it assumes ownership of the design and management of the recruitment process and the responsibility of results.
What to consider when selecting an RPO partner:
- Track Record - ensure that there is proven history of success with other clients, preferably in your industry. Talk to the clients which have been serviced by your shortlist of RPO providers, learn from their experience and ask them to provide references. A companies client list on RPO can tell you a lot about their ability to handle your project.
- Candidate Reach - make sure that your RPO provider has experience and knowledge of how to source and recruit outside of your geographic location. If the talent is not in-country, then you need to be confident that they can go and find it for you.
- Recruitment Process & Automation - RPO is all about process, look into detail at the processes and way in which the company handles applications from high-volumes of candidates, and how they get from volume to quality hires.
- The People Behind the Process - It's all very well having the processes in place, but the people running the project, from the management team down to the administration and recruitment team are critical to the success of the RPO.
- Your Core Values & Culture - It is vital that your RPO provider 'gets' your business. They must truly understand your values, your people and your culture in order to implement are highly effective RPO solution which exceeds your expectations.
- SLA's in Place - Always ensure that you agree Service Level Agreements which are metrics driven in line with your company standards to keep your RPO provider accountable. These could include time to hire, fill rate, quality of hire, retention, attendance, performance etc. and will vary depending on whether you are bringing in RPO for contract staff or permanent staff.
There are many benefits to RPO:
- Scalable solution to support the ebb and flow of hiring demands; with an RPO provider you can manage staffing for a seasonal business or ramp-up quickly when a new contract is won and increased headcount is needed. One of our clients we provide RPO for increases headcount by in excess of 700 staff in the lead up to Christmas in UK & Ireland. Our role in this is to source, select, screen, assess, hire, onboard and pay the staff and then manage any disciplinary procedures for the duration of the contract. We provide onsite staff and work seamlessly with the HR team and management within the business.
- Cost-Saving - What is the cost saving for a business in using RPO? A large IT company in the US saved over $1m per annum, representing 40% of their costs. Initially companies may look to RPO for cost reasons, but they also make long term gains. Outsourcing is better for efficiency, better service, employer brand reputation and a host of other reasons. Once corporates engage in dialogue with the RPO provider they start realising the value in other areas. Cost brings RPO to the table but its not why people sign up and stay with RPOs.
- Large or Small Business? - It’s just not just large corporates who are turning to RPO, start-ups who have just taken on VC funding are looking to RPOs as a quick and effective way to get scale quickly. They focus on what they do best and outsource areas such as recruitment and HR from the get go.
- Expertise & Industry Knowledge - An RPO provider can hit the ground running, they can start building a pipeline quickly
- Your Employer Brand - An RPO provider can give your company more exposure and more credibility in the marketplace by representing you really well to jobseekers and potential talent. Their reach in the market will be greater and many RPO providers will advertise on your behalf with your branding, as well as running social media campaigns to attract only the best people. Their networks in many cases can take you further afield and build you a great reputation in the marketplace.
- Strategic Focus for HR Teams - Bringing in an RPO provider allows key internal HR resources to refocus on higher level organizational competencies.
I hope you found this explanation useful, I am regularly asked this question so I thought I would share my thoughts and ideas and point you in the direction of resources that can help you decide if RPO is right for your organisation.
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