The Seven Tenets of Successful Recruitment Process Outsourcing

in Recruitment

Recruitment Process Outsourcing—better known as RPO—has gained significant market momentum in recent years. Yet it has taken a while. Given that employers have been seeking help in their recruiting efforts for decades, it seems odd that the rise of RPO as a service solution has taken so long. Isn't outsourcing of non-core functions a widely accepted business strategy? Isn't recruiting one of the largest line items for many organizations and not a core function?

Today, however, organizations that consider outsourcing their recruiting efforts can pore over and compare tangible outcomes seen by those successful early adopters of RPO. But tread lightly. There have been a number of very public RPO failures where results have fallen woefully short of expectations, sending business leaders and the marketplace back into the boardroom to debate yet again the viability and sustainability of the solution. Can RPO be truly successful? If there are companies out there who are reaping the proposed benefits of outsourcing, what are they doing that others are not? The fact is there are common elements—let's even call them tenets—that when followed, can greatly increase the effectiveness and ultimate outcomes of the RPO solution. Before we look at those tenets, however, it's important to understand the history of RPO.

Recruitment process outsourcing is the culmination of an evolutionary process that started with third-party recruiters engaged at the line manager level or as an adjunct to an organization's internal staffing initiatives. Utilizing the approach was simple: call your preferred recruiter(s) with a job description and expect screened candidates to be sent to you. Overall, this process continues to serve as a highly scalable option in many talent acquisition strategies, but it is extremely costly. Moreover, based on the transactional nature of the relationship, it comes with high risk and little accountability for results.

Companies soon realized they could bring the same talent in-house as contractors—their intentions clearly centered on achieving the same scalability but with reduced cost and greater control of the outcomes. In practice though, this model proved to be almost as expensive as high agency utilization and surprisingly, with co-employment and other new issues, even more complex. Worse yet, the rates for contractors continued to climb as corporate recruiters began to seek out these new, more highly paid "nomad" positions instead of their corporate roles. The desired "direct sourcing" impact these recruiters were supposed to have never materialized as skills, and innovative approaches floundered without the access to best practices and innovative techniques that contingency recruiters cultivated.

At the same time, traditional recruiting providers began to assume a more prominent role in assisting their customers with new ways to handle huge spikes in hiring. Although this represented a new challenge for both companies and providers, the solutions were primarily project-based and, therefore, rarely focused on achieving strategic improvements.

Over time, the RPO paradigm changed to finally justify its title, while providers literally began assuming delivery of an organization's internal staffing function. This early model was fraught with mistiming because most organizations treated RPO solutions like earlier transactional recruiting solutions. In addition, most providers simply weren't ready to deliver at the levels they had signed up for. As the burgeoning industry learns from itself, organizations have honed their approach to RPO vendor management and some providers have refined their solutions to near industry-standard levels. Let's look at some of the tenets they abide by to make it work.

1. Actively Govern the Relationship

Clear and close alignment of the provider and the customer is crucial to success. This sounds simple and intuitive, right? Surprisingly, this doesn't happen as often as it should for RPO. For many years, companies allowed RPO to be viewed internally as just another agency—though perhaps an agency on steroids—relegating the management of outcomes or the relationship itself to contract staff or even hiring managers. Successful RPOs have clear governance structures that raise visibility, accountability and impact of the partnership to the highest levels of leadership. Together, they look at trends, measure business impact, seek progressive levels of performance from one another and ultimately engage with their partners beyond the transactional level.

Second, accountability for RPO success must be driven across and down into the organization as shared elements of the process and tools become more common. This kind of governance eliminates the "sit back and watch" tendencies that can be seen from hiring managers.

2. Use Metrics That Count

In RPO, the word "metric" is grossly overused and under-defined. Organizations want metrics from their recruiting operations and many providers can deliver them, but the biggest gap can be highlighted by two questions: what do they really mean and how do we manage our business with them? Let's focus on measuring what really matters and let's stop producing metrics for the sake of it. Short-term transactional metrics such as open requisitions, hires-per-month, cost-per-hire and time-to-fill all have their place in operating a recruiting organization, but demonstrating a tangible impact on the business is what gives HR a true seat at the table. RPO provides a tremendous opportunity to create that linkage and many companies have jumped at the chance. Today we see correlations and indices from top RPO solutions that demonstrate talent acquisition's impact on longer-term outcomes, such as increased revenue, customer satisfaction, productivity, absenteeism and even safety.

3. Approach the Recruitment Process Outsourcing Program Holistically

Here is where true RPO can really shine. There are far too many loose applications of the term RPO. The fact is that RPO goes far beyond phone screening and structured interviews—recruiting in all forms impacts the quality of the workforce and even how their experience is maximized. Top tier RPO providers build their solutions to impact the client's talent lifecycle in its entirety, not simply in terms of candidate flow. A glimpse across the most successful RPOs shows much higher expectations of providers when it comes to having a deep understanding of other lifecycle elements: branding, assessment, performance management and engagement. Further, customers expect proactive data and research from their providers in these areas, not just surface knowledge.

4. Avoid the Sourcing Trap

On the other end of the RPO spectrum, organizations have been using RPO to describe the automation of processes, stand-alone software or even consulting. Don't fall victim to the "big hat, no cattle" ploy. Effective sourcing needs to be a critical core competency of the provider, not a secondary skill. Validate your RPO vendor's recruiting pedigree; ensure they can objectively demonstrate their ability to attract and recruit top-tier—and certainly passive—talent. This is one of the most commonly heard complaints of organizations that are not seeing the results they expected from Recruitment Process Outsourcing.

5. Ascend the Service Hierarchy (Together)

Recruitment Processs Outsourcing is a journey, not a destination. Early versions of RPO services strove primarily to address needs, such as accuracy or timeliness, as companies moved recruiting administration and interview logistics off their plates. Today, these are considered fundamentals for RPO and sit as the foundation for service—everything else fails if these are not in place. Cyclical industries have further driven the need for responsiveness from both partners to stay on track. With that said, the upper echelons of customer service have evaded all but the most successful RPOs.

Recruitment Process Outsourcing providers need to establish the fundamentals so that they can be proactive—pooling for key talent segments, partnering on workforce planning, aiding in the development of integration and expansion strategies as examples. Ultimately, the highest levels of customer service are seen from organizations that teach and learn from one another, making them more capable and more suited for the partnership.

6. Two Companies, One Culture

Maintaining recruiting efforts that are consistent with a company's overall culture and brand is a recipe for recruiting success and improved retention. Again, this seems intuitive, yet many don't invest the time and energy necessary to ensure cultural alignment and understanding between the new recruiting organization and the company it now represents. Top performing RPOs have provider talent so firmly embedded in their client culture, it is impossible to distinguish them from long-term employees. Why? They've deliberately been given access to all that full time employees have access to: new employee orientation, key leadership messaging, newsletters, training and line-of-sight to their impact on key strategic initiatives within the businesses.

7. Merge Services and Technology

Providers are striving to effectively integrate all services and technology related to the lifecycle on behalf of their customers. Given the number of vendors that may become part of an overall RPO solution, companies are demanding single source accountability from their partners. This once again raises the bar for RPOs in driving business outcomes from multiple providers around process, science and technology. Few do it well, but those that do provide a simple interface to an extremely complex set of solutions.

Conclusion

What is becoming clearer as the Recruitment Process Outsourcing market continues to mature is that HR outsourcing can transform talent acquisition and talent management. It is a matter of knowing the path to those results. Both the company evaluating and the provider they choose need to take and apply the lessons that the industry's failures have afforded them. Partnering with the right human resources specialist or RPO vendor in the right manner can both tip the recruiting scales in the employer's favor and deliver pervasive talent gains throughout the organization.

Author Box
Andrea Watkins has 19324 articles online and 24 fans

Andrea Watkins writes articles for Kenexa, the best business solutions providers for human resources around the world. Recruitment process outsourcing is a viable tool developed by Kenexa to scale up or down your operating expenses when recruiting but at the same time ensure you get the most suitable candidate for the job. hr outsourcing is no magic bullet and it requires your company to work with a results-proven RPO company for the best results.

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The Seven Tenets of Successful Recruitment Process Outsourcing

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This article was published on 2010/10/12