RPO at 10: What It Mean for Buyers, Providers & Results (Part 2 of 3)

by Allison Reilly

RPO at 10In part one, Recruitment Process Outsourcing in its Infancy, of this three-part series, we covered the recruitment process landscape as it existed 10 years ago. Back then, many HR leaders and companies were not comfortable with outsourcing and needed to be educated on what RPO was. Also, some of the first RPO providers needed to prove that this solution worked and was better than the other recruiting solutions that existed. Now, in the second part of this series, we explore what the landscape is today and what RPO means for buyers, providers and results in 2014.

What It Means for Buyers

When Kipp Sassaman, vice president of human resources at Fikes Wholesale, started in his position, he didn't like the idea of outsourcing. After all, recruitment management and human resources was his job! It's in his job title. But, when he arrived at Fikes, he saw that the company had a need for additional recruiting help.

"What I encountered here was no continuity, a very disconnected process and system. What I would consider a very up-and-down or disparate candidate experience. They didn't get the same experience every time through the process," said Sassaman. "In building an internal recruiting function, it seems as if you always either have too many recruiters, or not enough. There's never really a sweet spot."

Upon encountering all this problems with the current recruiting process at Fikes, Sassaman started to look for a cost-effective, yet scalable solution for talent acquisition. He saw that RPO could do that while keeping control with Sassaman so he could continue to do his job as vice president as well as improve the candidate experience. Sassaman started slowly with RPO two years ago, but says the company has picked up momentum every week with the solution.

What It Means for Providers

Verticals and domain expertise are growing trends that didn't exist 10 years ago. An example of this would be providers who specialize in working with healthcare organizations. John Younger, CEO of Accolos, said that a common factor among organizations in specific verticals or domains is that the organizations still have a variety of departments but can only manage to focus and do well with one or two departments. A healthcare organization has all of their health positions as well as an accounting department, an IT department etc., and typically needs help in meeting all the recruiting needs of all their varied open positions.

"In short, it requires that deep domain focus and expertise backed by deep resources, and we've seen it done successfully," Younger said.

As for pricing and core RPO services, Mike Mayeux of Novotus suggests that organizations start small with an RPO provider before signing the long-term contract.

"It's a marriage. It's an all-in move," Mayeux said. "[You need to make] sure that the cultures match and that everyone had a chance to test out each other."

Because the RPO buyer/provider relationship is a partnership, and is much more than a business transaction, core RPO services include a variety of choices and can be customized to each buyer or situation. Services can include from employment brand marketing to research, from having a recruiter on staff to building a career site in addition to the actual recruiting services.

What It Means for Results

Once Sassaman of Fikes Wholesale considered RPO as a solution, he also started to think about the employment brand and how to promote open positions. Since candidate experience was something he wanted to improve, he wondered how the previous and the current candidate experience impacted the brand and what could be done to communicate a positive message.

As for what a buyer would have to pay to see these results, Mayeux said that it's nearly impossible to offer a price without knowing the exact circumstances. RPO pricing is dependent upon geography, complexity, and volume, among other things. However, there are sources such as Staffing.org that provide a benchmark report of talent acquisition costs. Staffing.org uses a formula called the recruitment cost ratio to determine, by industry, the typical pricing for that industry in talent acquisition.

To learn more about the past, present and future of RPO, our latest webinar featured a panel discussion profiling the changes that have brought this industry from “the wild wild west” to the new landscape of the current competitive market. Now that the dust has settled, the RPO industry has grown significantly over the past 10 years and has increased in sophistication. View this webinar's video to learn how today's RPO adds extraordinary business value.

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