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Recruitment Process Outsourcing: A Guide to RPO’s What, How, and Why

Recruiting has never been more challenging. Even with certain industries slowing down due to high-interest rates, the labor market remains exceedingly tight; as the baby boomer generation retires, labor market participation is waning. Coupled with this, new candidates to fill these roles prove increasingly difficult to engage. Correspondingly, there is an increasing need to pair advanced technology with recruiting process expertise to plan efforts that yield high-quality hires at a low cost.

Leading companies are increasingly turning to recruitment process outsourcing (RPO) companies to bring new energy and insights to their talent acquisition. By implementing innovative technologies such as machine learning and artificial intelligence (AI), RPO service providers can improve your strategic workforce planning ASAP. Given current labor market trends, recruitment process outsourcing makes sense as a solution now more than ever.

One pre–COVID-19 study by Aberdeen Strategy Research found best-in-class companies are 46% more likely to say engaging an RPO partner reduced their cost-per-hire by at least 25%, and time-to-hire by at least 20%. In addition, the RPO industry is forecast to grow at an incredible 17.4% compound annual growth rate (CAGR) through 2027.

Let’s explore exactly what this service entails and how it’s different from other recruitment services. We’ll also look at how your business—and your bottom line—can benefit from RPO.

recruitment process outsourcing for healthcare workers
Source: Shutterstock

What It Is—and What It Isn’t

Recruitment process outsourcing is the transfer of some or all of a business’ recruitment functions (advertising, sourcing, screening, initial interview, and so on) to an external service provider. An RPO provider operate as an extension of a client’s recruiting teams, leveraging the client’s brand and employee value proposition. They work collaboratively with clients on process design and take full responsibility for the management of the recruitment funnel.

Recruiting top talent requires navigating a tight labor market, being proficient in relevant technologies, and nurturing candidates along the recruitment journey. RPO providers are talent acquisition experts. They know what to look for and which technologies to use, and they can scale recruiting capacity as needed.

How Recruitment Process Outsourcing Works

RPO providers integrate technology, processes, and metrics to find the best people for your business. Using machine learning and AI, they can engage candidates via:

  • Automated CV screening
  • Sourcing
  • Chatbots
  • Assessment tools
  • Self-scheduling interviews

They also help improve diversity in hiring and employer reputation.

What’s more, RPO providers don’t simply advertise the role you need to be filled now. They also drive candidate exposure to your brand via social media, networking, referrals, and job boards. This helps build brand recognition for employment and engages potential talent for the future.

Once service providers find candidates with suitable skills, they guide these candidates through the hiring process to ensure they have the motivation for the job and start off on the right foot. After all, a candidate’s experience has a significant impact on their longevity with the organization.

Finding the right talent can be hard. But in today’s competitive environment, getting top talent to want to be part of your company can be even harder. An unpleasant experience during the recruitment process can cost you a great candidate.

RPO recruiters use a long-term partnership approach to provide ongoing analysis of your recruitment strategy. With advanced applicant tracking systems, they can identify inefficiencies and sticking points in the process. They also report back on key metrics like time-to-hire, cost-per-hire, candidate satisfaction, and retention rates.

RPO vs. Staffing & Search Firms

RPO differs considerably from staffing and search firms. In their motivation to get bodies on the job to fill vacancies, staffing firms typically deliver lower-quality candidates with high turnover.

RPO Cost per hire
Image: Source2

In tight labor markets, the best candidates have the ability to choose their employer. Staffing firms typically pull from a less reliable and dependable population when it comes to committing to a full-time position with a single employer. The corresponding high turnover has a significant impact on safety, quality, and productivity.

Meanwhile, search firms, while focused on high-quality hires that are a good fit with the client, are not organized to recruit in scale. As a result, their fees are very high.

While staffing and search firms are highly transactional, RPO is strategic and relationship-oriented. An RPO provider works in close collaboration with the client in designing and executing a highly efficient end-to-end recruitment process. While the exact services offered will vary between providers, you can expect them to be hands-on, guiding you through best practices and providing recommendations.

Consider creating a checklist that enables you to determine which needs align with your organization's business objectives. After completing the checklist, businesses can discuss it with their RPO partners to determine the most effective ways to address their specific priorities.

RPO providers aim to build a talent pipeline of active and passive candidates. They spend more time investigating applicants’ backgrounds, thoroughly assessing suitability and compatibility with your company culture and values. In addition, their approach is strategic and long-term—they’re essentially an extension of your business and serve as your representative to candidates. So you can be confident they’ll represent your brand well!

Frontline workers
Source: Shutterstock

Why Outsource the Recruitment Process?

Since recruitment process outsourcing focuses on a long-term relationship, it serves a much bigger role than simply filling a vacancy. At its core, it’s a strategic partnership aimed at helping you achieve your business goals.

An RPO partner will work with you to understand your unique needs. With their analyses, planning tools, and expertise, they assist with staff planning and forecasting to help you save in the long run.

By immersing themselves in your brand and building a talent pipeline, RPO service providers bring many value-added benefits:

  • Reduced time-to-fill
  • Lower talent acquisition costs
  • Improved candidate experience—and therefore employee retention
  • Management of seasonal hiring fluctuations
  • Brand promotion
  • Free internal recruiting to focus on filling high-level, professional roles
  • Access to the right talent at the right time
  • Freedom for HR to focus on high-value activities (such as retention, training, and professional development)
  • Advanced analytics that enable continuous improvement
  • Regulatory compliance
  • Improved onboarding and company integration

Choosing the Right Recruitment Process Outsourcing Partner

The right recruitment process outsourcing partner will work collaboratively, not as a siloed third party. At Source2, we see ourselves as an extension of your internal team, working in alignment with your other HR functions.

Our flexibility and our expertise in high-volume hiring set us apart from the rest even further. Source2 recognizes that each client has unique challenges, needs, and desires—and that circumstances can change on a dime. We pride ourselves on our ability to meet the unique and ever-evolving needs of our clients.

Not ready to jump into an RPO contract? You don’t have to just yet. At Source2, nearly all of our new client partnerships begin with a pilot program. This unique approach lets you view our capabilities first-hand while establishing the most suitable partnership structure. And while most of our pilot programs lead to long-term business relationships, there’s no obligation to commit.

Importantly, our pricing model is highly variable-cost driven—meaning that the vast portion of our compensation are per hire fees, earned and paid when candidates actually start. This pay-for-performance pricing model ensures that you receive expedited, top-notch service.

Our experienced recruiters specialize in finding frontline workers across a wide range of industries, including:

  • Manufacturing engineering
  • Distribution & logistics
  • Healthcare
  • Construction
  • And more!

We leverage technology for extraordinary results and prioritize accountability, teamwork, and doing the right thing for our clients. Contact us today to see how we can customize a service that meets your recruiting needs.

Written By: Source2

Tags: Talent Acquisition and RPO

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