5 Insights on the State of the Recuitment Process Outsourcing Industry

by Lamees Abourahma

A Perspective of an RPO Leader on the State of the Industry

Now what? The honest answer is that none of us has a crystal ball.  However, I am sensing some trends in the RPO industry that might be worth keeping an eye on. Certainly the playing field in the recuitment process outsourcing industry has both narrowed and expanded, with numerous original founding players exiting, and a slew of new faces and makeovers joining the fray. This may make it harder to differentiate ourselves and harder for buyers to differentiate between us.

Over time the market will take care of itself and the cream will always rise to the top.  Organizations such as the Recruitment Process Outsourcing Association (RPOA) can play an important role in translating for the Buyer community, and provide a forum for continuous improvement for the Vendor community.  RPO as an industry is maturing.  As it does, we as Providers will get better at delivering quality solutions and Buyers will get more sophisticated at selecting the right partners.

Other random observations:

1. Mid-size and smaller companies are buying RPO services.  Fast.

These size firms may end up driving the space in this next economic run up.  When dealing with these size firms, RPO providers will be well served to sharpen their game.  We will be dealing with tough buyers that will ask tough questions and keep a very close eye on the project. They do not have money to waste and demand ROI every day.  They expect to be at the center of the provider’s universe and it will not take months or even weeks to figure out that something has changed.

That is good news for committed RPO providers; for true customer advocates.

2. Generic RPO will go in one direction.  Precision RPO will go in another.

There is a place for large-scale enterprise RPO programs.  There always will be.  Peoplescout is a good example of a solid player in the large-scale process-centric view of RPO.  I have admired Peoplescout from afar as they have built an impressive array of processes, technology and people to drive that kind of RPO.  The Walmarts of the world will outsource and Peoplescout will be there to serve them with excellence.

For the rest of the industry, and even in specific mission critical areas of the large buyer, more precision is required.  Specialized firms, like many in the RPOA, are emerging as very strong players in providing niche or highly technical RPO hiring.  When positions are hard to fill and talent is scarce, these players can be relied upon to provide superior services to the Big Box RPO providers.

3. Direct Sourcing will become Critical Again.

While the concept of “Direct Sourcing” has changed a lot since I was handed a phone with a wire and a phonebook, the essence of it is about to become a whole lot more important.

Talent in many industries and areas of the country is already hard to find.  Technology-driven companies are struggling to find the right skills.  There is no unemployment for many talent clusters now and that will accelerate as the economy turns.

Aggressive, outbound direct sourcing is essential.  Making actual contact with human beings and selling them on the concept of exploring a new opportunity is important again.  Identification is no longer the critical skill it once was due to Linked In and the myriad other Internet search capabilities.

The skills needed to turn ID data into candidate flow is beyond critical.  Back to the phones folks.  Skillful e-mails and in-mails are important.  Communications skills and marketing savvy are critical.  Back to the future.

4. Recruiters are Important

It has been a tough 4-5 years for the profession both on the corporate side as well as the RPO side.  That is about to change.

RPO providers will be well served to adjust their employee satisfaction programs.  Our core competency is finding and retaining the best Recruiters in the country.  Systems must be built.  Programs must be developed.  Training will re-emerge as important.  Creating an environment that Recruiters want to work in will be important again, if it ever went out of style with some of us.

RPO providers must be employers of choice for Recruiters.

5. Customers ARE the center of our Universe.

More than anything, RPO providers need to learn from this year of consolidation in our industry.  Some clients were not well served.  RPO has a little damage control to do.  Corporate buyers might be a little jaded if they were dealing with a RPO provider that is now just a division in a much larger and somewhat threatening company.  Service levels have suffered so we will have to forgive the buyers if the vetting process gets a little tougher.

We would be well served to remind ourselves that without willing buyers of RPO there is no RPO industry.   

david pollardAbout the Author: David Pollard is President and founder of TalentFusion, leading the firm from inception through its current trend of rapid growth. TalentFusion has become a thought leading firm helping organizations optimize how they deploy their recruiting resources to take full advantage of the outsourcing option to create scalable, flexible recruiting capability

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