Recruitment process outsourcing (RPO) is a form of business process outsourcing (BPO) where an employer transfers all or part of its recruitment processes to an external service provider, according to the Recruitment Process Outsourcing Association (RPOA). An RPO provider can provide its own or may assume the company’s staff, technology, methodologies, and reporting. In all cases, RPO differs greatly from providers such as staffing companies and contingent/ retained search providers in that it assumes ownership of the design and management of the recruitment process and the responsibility of results.
Today, the recruiting environment is rather complex. In order to effectively recruit top talent, you need to navigate a tight labor market; become proficient in a set of relevant technologies; and manage and nurture candidates and hiring managers. RPO providers are subject-matter-experts; talent acquisition is their core competency. They know how to navigate the recruiting environment, stay current with the latest recruiting technology and have the resources to scale recruiting capacity to meet hiring demands. RPOs bring people, technology, process, and metrics into a talent acquisition function.
According to RPOA co-founder and Talent Acquisition expert John Younger, “the number one reason companies succeed, struggle, or fail directly correlates with who they hire.”
Depending on what an organization is looking for, an RPO solution can bring an array of many benefits including managing hiring fluctuations throughout the year; reducing total recruiting cost and dependency on staffing agencies; improving hiring manager satisfaction; reducing time-to-fill; elevating employment brand; improving candidate experience; simplifying or streamlining the hiring process; and saving time for other duties among other benefits.
Historically, RPO provided high-volume hiring for large organizations at a lower cost compared to other recruiting options. However, RPO has evolved over the last few years to become a flexible strategic talent acquisition solution with additional benefits that can be adopted by small and medium-size organizations as well.
Over the past few years, RPO has been trickling down into the smaller and middle market domain as outsourced recruiting becomes applicable to these markets. As a result, smaller, agile RPOs are rising into the higher ranks of strategic recruiting partners and carving their unique niche in the talent acquisition marketplace.
Unlike other outsourced recruiting models, recruitment process outsourcing is a strategic partnership that brings additional value-added benefits, including:
Analysis and planning. When run effectively, RPO providers work with their clients to understand the business side of recruitment or business goals. They help clients forecast staffing needs and plan the necessary resources to respond to these needs, which help achieve those business goals.
Extensive job marketing. RPO providers market client jobs through job boards, social media, referrals, and networking to drive candidate exposure to jobs and employer brand (a major differentiator from staffing solutions).
Sourcing and engaging talent. In addition to finding talent, RPO providers build up employment brand and recognition; engage future potential talent through talent communities and talent pipelines; and source candidates in advance and with multiple sourcing assessments.
Candidate assessments. RPO providers assess candidates, guide them through the beginning of the recruitment process, and make sure they have the core skills, competencies, and motivators to do the job.
Candidate care. Managing the candidate experience is very important as it reflects on your employer brand. RPO providers help clients take care of the candidates and manage their experience, whether they are being interviewed, hired, or considered for the job.
Three basic types of RPO engagements
RPO is not a one-size-fits-all. RPO offers different engagement models. John Younger, RPO expert, and RPOA co-founder describes the following three main RPO engagement types:
On-Demand RPO: A contract-based engagement with a qualified provider that knows the company, their messaging, their processes and the results they need. The contract specifies a defined number of roles within a defined period of time.
Function-Based RPO: The RPO provider takes a piece of the company’s recruiting needs entirely off the company’s plate (e.g., the IT department or an entire division of the organization).
Full RPO: When the RPO vendor provides a company’s entire internal recruiting function including access to the provider’s full breadth of resources.