What You Need To Know About Recruitment Process Outsourcing (RPO)?

Last updated on 

December 14, 2021

by

The VA Reviewer
Recruitment Process Outsourcing

Talent analytics, recruitment technology, and new sourcing tactics are used in today’s recruitment solutions to deliver your company the employees it needs. 

Find out how recruitment process outsourcing (RPO) may help you find, screen, engage, employ, and onboard the appropriate people while increasing business agility.

In a nutshell:

  • Recruitment process outsourcing occurs when a business outsources some aspects of the recruiting process to fill vacancies. These tasks are handled by a person or organization that specializes in recruiting.
  • Employers can delegate as much or as little of the recruiting process to RPO providers, who can act as internal resources by taking over the entire process of stepping in for individual projects, regions, or anything in between.
  • Many RPO providers can act as the organization itself instead of an agent on behalf of the employer.

What is Recruitment Process Outsourcing (RPO)?

Recruitment process outsourcing (RPO) is a type of business process outsourcing (BPO) in which an employer outsources all or a portion of its recruitment processes to an outside service provider. An RPO provider can provide its staff or take over its team, technology, methodologies, and reporting. 

In all cases, RPO differs significantly from other providers such as staffing firms and contingent/retained search firms. It assumes responsibility for designing and managing the recruitment process and the results.

Your RPO model can be modified to include a specific set of services directly related to your company’s goals, needs, and recruiting challenges. Your company’s recruitment resources can be scaled up or down based on changing hiring needs, giving it a high level of flexibility. Some RPOs also provide talent mobility and career transition services to clients downsizing their workforces, making for a complete end-to-end solution.

Types of RPO Models

Consider several factors when determining which recruitment process outsourcing solution is best for your organization. Here are the four most common types found on the market:

End-to-end RPO

It is a long-term solution that includes all services associated with permanent recruitment, including recruitment technology investments. The most excellent savings, efficiencies, hiring outcomes, satisfaction, and compliance can be expected, but this model is also the most difficult to implement.

Your RPO provider may supply on-site and off-site resources to consult with your hiring managers, process requisitions, source and screen applicants, schedule interviews, prepare and deliver offers, and undertake onboarding activities. 

End-to-end RPO is frequently evolving through value-added services such as talent marketing and employer branding, internal mobility programs, advanced recruitment technology implementation, and contingent workforce management.

Project RPO

It is an end-to-end approach to a specific project, such as launching a new product or establishing a new branch. Suppose you need the benefits of an end-to-end system for a particular hiring project but want to retain internal recruitment capabilities for day-to-day hiring. In that case, project RPO is an effective solution.

Selective RPO

Selective RPO addresses and strengthens specific aspects of your organization’s internal recruitment process. Many employers outsource their sourcing and screening processes and candidate management entirely. With selective RPO, you only get the best practices for the services you need.

Recruiter on Demand (ROD)

This model provides recruiters to assist your company with hiring spikes, new business initiatives, product launches, or handling portions of the hiring process. You can add recruitment capabilities right away without requiring any process adjustments or technology development; however, unlike other models, ROD does not often result in permanent process transformation.

Why consider RPO?

Today’s modern recruiting environment is quite complicated. You must navigate a tight labor market, become proficient in a set of relevant technologies, and manage and nurture candidates and hiring managers to recruit top talent effectively. RPO providers are subject-matter experts, and talent acquisition is their primary focus. They know how to navigate the recruiting landscape, are up to date on recruiting technologies, and have the means to increase recruitment capacity to meet demand. RPOs combine people, technology, process, and metrics into the talent acquisition operation.

An RPO solution can provide a variety of benefits depending on the needs of the organization, including managing hiring fluctuations throughout the year, reducing total recruiting costs and reliance on staffing agencies, improving hiring manager satisfaction, reducing time-to-fill, elevating the employment brand, improving candidate experience, simplifying or streamlining the whole hiring process, and freeing up time for other tasks.

Advantages of RPO

Using market insights and talent analytics, you can improve workforce planning and gain agility.

Innovative sourcing and screening strategies, AI-powered recruitment technologies, and tried-and-true talent marketing and employer branding strategies can help you quickly find and recruit the right talent.

Other advantages of RPO include: 

  • Reduce hiring costs by relying less on third-party agencies;
  • Create a more diverse workforce, equitable hiring strategy, and inclusive culture;
  • Create talent pools for niche and in-demand skills to quickly find qualified candidates;
  • Gain instant specialized sourcing, talent marketing, candidate management, and onboarding expertise without investing in internal resources;
  • Reduction of risks by using compliant hiring practices; and
  • Construct the process and technological infrastructure required to transition to a total talent management model.

Disadvantages of RPO

Employers may feel as if they have less control over the recruiting process, making some organizations or individuals uneasy. The organization will never know if a qualified candidate was passed over. It may also be difficult for an RPO provider to understand role requirements and the organization’s culture, both of which are important in finding a good fit.

How to Choose the Best RPO Recruitment Solution?

Its current challenges and long-term goals determine the best RPO model for your company. Taking note of these questions will put you on the right track:

  • Do we require resources on a short-term or long-term basis?
  • Do we want to change our company’s current hiring practices?
  • Are our agency utilization and costs consistently high as a result of ineffective internal recruitment strategies?
  • Do we want our recruitment capabilities to be up to date in terms of methods and practices?
  • Are our talent requirements urgent because of a new initiative or internal team issues?
  • Do we understand how and when technologies such as artificial intelligence (AI), recruitment marketing tools, candidate engagement solutions, and talent analytics can best complement human intelligence to improve our recruitment results?

Each model has a high degree of adaptability and agility. The right solution for you today can evolve with your company to adapt to changing markets.

Costs of RPO

Monthly management, placement, and project fees are used to calculate recruitment process outsourcing rates. An end-to-end solution would typically guarantee a minimum volume of hires to provide a baseline cost. An incremental fee is added for each placement.

A project RPO engagement may be priced similarly. However, because the scope and volume are typically well-defined and distinct, your provider may be able to provide a more specific estimate. Fees in selective RPO can be determined by the volume. For example, per candidate is scheduled for interviews or a particular project, e.g., an employer brand audit). In all cases, the costs are typically lower than those of a recruitment agency.

Takeaway

RPO improves recruiting effectiveness and provides a competitive advantage to an organization when adequately implemented. As previously stated, improving recruiting and hiring allows an organization to place the right people in the correct positions, resulting in an environment where everyone wins:

  • Employees are happier.
  • Management is more effective.
  • Executives hit their numbers.
  • The company is better positioned for success.

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