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Recruitment Process Outsourcing (RPO): What It Is…And Isn’t

The term recruitment process outsourcing (RPO) is gaining recognition among hiring managers. But what is it? And is it worth looking into?

RPO is defined as a form of business process outsourcing in which an employer transfers all or part of its recruitment processes to an external provider. RPO providers can manage the entire recruiting and hiring process, or can manage one or two aspects of the process, essentially serving as an extension of a company’s human resources department.

How does RPO recruitment differ from using a traditional recruiter or staffing firm? Instead of a completely outsourced recruiting process, RPO providers often work with an employer’s own resources to improve upon that employer’s recruiting processes and results. In most cases, RPO providers offer specific services from job profiling to the on-boarding of the new hire, including staff, technology, method, and reporting. RPO contracts often span years.

“Effective RPO firms will work with talent acquisition leaders, C-suite executives and other stakeholders to formulate and monitor metrics to make sure they’re on track 30, 60, 90 days in, and for the duration of the project,” explains HR Dive’s Tom Starner.

Proponents of RPO exclusively assert it holds many benefits over traditional contingency staffing. But the truth is that using elements from both areas is often the best way to improve recruitment and retention. The good news? Leading staffing firms already do just that.

“There are specific scenarios in which RPO does well but it tends to be in large-volume, entry level positions,” says The HT Group Managing Partner Nad Elias. “The drawback to RPO is the process is somewhat reactive and often treats a search for a customer service rep the same as a CEO search.”

In fact, as one industry white paper points out, RPO is not designed to be an on-call permanent placement service or to replace a headhunter or traditional recruiter. It’s also not for the occasional opening or to fulfill the need for a quick list of candidates. And it’s not suited for temporary staffing needs since the candidates recruited through RPO become direct employees of the client.

Elias goes on to explain while many RPO-only providers assert the process can and should be used for specialized positions, that hasn’t been his experience.

“The unfortunate reality is that we—as a full-service staffing and executive search firm—have been called in to ‘clean up the mess’ an RPO has made when it’s been utilized in the wrong situation or in the wrong way,” he adds. “The times in which I’ve seen RPO recruiting fail the most is for top-level executive positions or highly skilled and hard-to-source positions.”

He believes this is because executive-level positions require highly individualized and expert resources to fill. For example, as we explained in an article last month, top executive candidates aren’t scrolling through job boards or asking friends for referrals. They are passive job seekers who can only be found through exclusive access and advanced recruiting strategies.

“There are scenarios in which we would utilize RPO methods and others in which we would employ more traditional and highly qualitative recruiting practices,” Elias says. “The benefit of a firm like The HT Group is that we help our clients decide which will be most advantageous on a case-by-case basis.”

Having been in use for only about 10 years, RPO is still being tried and tested. What questions do you still have about RPO recruitment? Have you considered it? Why? Start the conversation here!


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