The top three ways companies leverage RPO today

Greg Karr

So, you’re considering hiring a recruitment process outsource (RPO) firm, and naturally weighing up the pros and cons of leveraging a RPO solution.

As you consider your options, it’s important to recognise how the offering has changed in the last five years. The provider community, the service itself, and the core benefits have all shifted, in some cases quite dramatically, to keep pace with micro and macro changes in hiring. I’d like to highlight three changes offering dramatic benefits to you as a buyer.

1. Transformative vs. ‘lift and shift’

In the past, HR would turn to RPO to get more hands on deck. They were generally pleased with their talent acquisition (TA) model, and so were looking to an RPO provider to deliver the same process. It was all about moving recruitment off their plate. Today, companies turn to RPO because they recognise that their current TA model is flawed, not keeping pace with the expectations of a twenty-first century workforce, or facing systemic challenges that are threatening the future of the company. A leading RPO provider brings process design, sourcing, employment branding, analytics, and performance improvement services, as well as highly experienced and focused TA professionals to the typical engagement. It provides the engine that keeps your company moving forward with the quality of talent needed to compete, delivering an agile and flexible solution. By bringing a transformative intent, a RPO provider can improve efficiency and help you align TA with real business outcomes; so you’re not thinking ‘who can do recruiting for us’, but rather ‘who can help us do recruiting better.’

2. ‘Service and quality; vs. cost out

When clients came to me five years ago, their biggest goal was to drive cost out of recruiting and saving money. Cost is, of course, still highly relevant. Today though, getting a ‘good deal’ is less about lowering cost and instead centred on driving value. You may see your recruiting spend go up, but it’s an investment in the business, and the entire point is to upgrade your people and processes. There are typically cost-savings that come from improved efficiencies (such as the hours hiring managers free up to focus on coaching and team-building), organically sourcing higher quality candidates and eliminating agency fees, or improving revenue generation by quickening time to hire and getting sales people in the field quicker. Better-quality hires improve retention, help drive revenue, and, ultimately, save you money long term. A better employment brand reputation, more engaged employees, and increased productivity lead to happier customers who spend more. Instead of trying to save a little bit of money on recruiting, companies are trying to make a lot of money by hiring better people faster. Recruiting is no longer a cost centre; it’s a revenue-generating centre.

3. Fluid vs. fixed

RPO deals used to be somewhat rigidly constructed and even bundled into 5–10 year HRO deals. These deals often came with fixed deliverables, SLAs, workflows, and prices. What they lacked was the ability to be fluid and move with the business. Today, the only thing guaranteed in TA is that change will come. Macro-economic conditions, candidate behaviour, and the competitive landscape you work in are all fluid. In this environment, an RPO programme needs to be highly agile and responsive. You need a partner who is agile enough to move with you, and you need to be agile enough to shift and respond. This may mean changing pricing when the statement of work (SOW) shifts, constructing a new recruitment process workflow when you integrate a new applicant tracking system (ATS), adjusting the number and type of onsite resources, or modifying the process when you acquire a company in a new geography. You want your RPO provider to demonstrate in their own talent development and promotion strategies that they operate their business with a fluidity that will be carried over to yours. Do their employees stick with them? Do they have a model that fosters organic growth and promotions? Check references, too. Have they demonstrated an ability to adjust delivery strategy based on shifts in the business? How have they handled adversity?

Excellence in recruiting is one of the most important things for your company and you need TA to be awesome. A great RPO provider can help you transform the function, drive value to the business, and respond to inevitable change.

Greg Karr is Executive Vice President of Seven Step RPO