Key consideration when choosing RPO

The biggest challenge that an HR Manager faces today, is recruiting the right talent for their organisation. The challenge becomes greater when the recruitment demands are complex, unpredictable and variable by country. Unless this is managed properly, it may result in poor hiring decisions, unsatisfied employee, high turnover rate and increased cost. This ultimately impacts the organizational ability to meet their global demands.

Recruitment Process Outsourcing or RPO is the latest business model in the field of HR. It’s like BPO industry, where an organisation outsources the management of one or more of its non-core process to a third party. Similarly, in Recruitment Process Outsourcing a company outsources the management of the recruitment function (in whole or part) to a third party.

The process allows companies to get the services of a third party who have an expertise in this functional area. The RPO service providers, on their part, bring best practices and capabilities to find the talent and new hires that their clients need. So, the firm is given the responsibility to place people into that organization. The organisation gets benefits in terms of cost, quality, efficiency, service, and scalability.

Looking at the benefits, RPO Services in India is also growing at a fast pace, and many organisations are looking at help outside to fulfil their short term and long term manpower requirements.

While the traditional Staffing Agencies are RPO do similar work. The major difference is in their scope of work and the value added services over by RPO Service Providers. While the scope of traditional recruitment firms is limited to source and place the candidate in the required role, the RPO Service Providers take ownership of the design and execution of the complete recruitment process. They work as an extended arm of the HR team and act as a regular funnel to fulfill their manpower requirements.

Depending upon the requirement, there are 4 common RPO Models, which are given below:

1. Holistic Hiring: In this model, all hiring requirements including consultants, workers, freelancers, non-permanent staff are taken care of.
2. Project Based Hiring: In this model, only short term hiring requirements are handled. These requirements may be one time or repetitive in nature.
3. Selective Hiring: In this model, the client has an existing team, and wants to add some more people to add on.
4. On Demand Hiring: In this model, the requirement is to hire people for the organisation’s in-house function.

An organisation, may choose any of the above model. But our experience says that there is no one-size-fits-all solution. Companies need a customized strategy to get the desired benefits.

As competition for the best talent heats up, more and more employers are looking for better, more efficient options to acquire talent without having to build an internal army of recruiters. In such a scenario RPO emerges as a highly effective recruitment practice. Many blue chip companies like Tesla, IBM, Barclays, Google, Facebook etc. have benefitted from this technique.

1. Work with the Experts: Today, we are living in a world, where everybody looks at experts for getting something particular. So, if an organisation does not have people in-house who possess the required skills, it makes sense to work with an RPO provider. For the RPO providers, this is something they do, day in and day out.
2. Cost Efficient: Since RPO providers work on economies of scale, so they adopt proven recruitment processes and channels that reduce administrative burden, and a good RPO provider will come with robust network of candidates that allows them to find talent without much advertising investments. As per studies, taking the RPO route can reduce recruitment costs by 50%.
3. Saves time: Since the RPO Providers have a ready talent pool, they are able to shortlist the prospective candidates and provide the organisation with robust network of candidates that allows them to find talent faster. Such an arrangement helps reduce time to hire by 40%.
4. Access to Global talent pool: Since the RPO firms have access to talent from across the globe, they are able to make them available and the organisation is able to choose from the best across the globe.
5. Global Recruitment Know-How: The hiring rules and processes of different countries are different, and it’s a big challenge for any HR Director to hire quality people quickly. Here, again RPO providers come handy with their knowledge and expertise in expanding your team globally.
6. Use of Technology: RPO companies employ all the modern techniques for recruitment and conducting interviews. They employ new interviewing trends like video interviewing, online assessments.
7. Ability to Scale or Shrink, as per the need: RPO helps companies address real-world fluctuations in hiring. When the companies need a big time quickly, RPO Provider can scale up the team, very quickly. And the team can be taken off, when things slow down. This is best suited for requirements, which are short-term in nature. In such cases, RPO is far more efficient than hiring temps.
8. No geographical limits: The RPO providers can offer recruitment outsourcing solutions through various modes. They can work on-site as an extension of the client’s talent acquisition team, can work off-site, and/or through a combination of both, across country-aligned, multi-regional or global remits.

Just like any other industry, when it comes to RPO, there are many service providers. And each service provider has its own industry specializations and different ways of working with clients. So, it becomes bit difficult to determine which RPO provider will best fit your company and your needs. This section of the blog specifically answers this question.

Before getting into short listing the RPO Service Providers, you need to do a little homework at your end. You need 3 different things ready before hand. These 3 things are:

1. Thorough knowledge of what are your requirements
2. List of important criteria that that you expect to be fulfilled by your RPO providers
3. A good way to evaluate the providers who apply.

There are many key considerations to be kept in mind, while selecting a RPO Service Providers. And these criteria vary according the specific needs of the company and the industry that they are involved in. For example, for a company working exclusively on government contracts, having an RPO Provider, who has a thorough knowledge of government contracting will do a better job as compared to someone, who does not work on contracts at all.

However, there are some criteria that should be considered regardless of company and industry specifics. These criteria include:

1. Domain Knowledge – The first consideration is that whether the RPO Service Provider has the required domain knowledge of the client’s business.
2. Provider Capabilities – Then, we need to check whether the RPO provider have capabilities that the company needs?
3. Client-Agency Chemistry – Since both the parties have to work ‘hand in glove’ with a common objective, we need to check whether the RPO provider and client company share a good professional bonding?
4. Cost – What will be the cost involved in this RPO engagement?
5. Partnership – How will this partnership work? Will the service provider work as just a contract hire or actually, work as an extension of the company’s HR team?
6. Experience – What is the length and depth of experience, the RPO provider has working on engagements similar to this one?
7. Past and Existing Clientele: Who are the clients, who they have worked in the past or they are working currently. This gives an idea about the capabilities of the people, who are going to provide talent pool to your organisation.
8. Value Added Services: What are the different value added services offered by the Service Provider.

While there are can be more criteria that companies can use to evaluate RPO providers, these 8 are the must have in any evaluation.

Today, most HR managers are overworked and handling many things at the same time. The job market is very volatile and its becoming increasingly difficult to hold on to talent and attract new talent. Many companies may not have the necessary skills and expertise to develop a proactive hiring strategy. Some may not even be equipped to test, interview and appraise candidates for highly technical roles.

In all such cases, RPO Service Providers come very handy. While they do all the leg work, the HR managers get time to focus on growth of their organisation.