By Bill Ingram, Executive Vice President of Seven Step RPO
If you’re thinking about hiring a recruitment process outsource (RPO) firm on a short-term or project basis, there are important things to consider before taking that route. Most companies look at RPO when they are struggling to achieve target recruiting results or when their internal team is over capacity. Project RPO offers wonderful benefits and direct solutions to these challenges, but it’s not something to jump into blindly.
What is Project RPO?
In enterprise RPO, you hire the RPO provider to become part or all of your full-time talent acquisition team, and their experienced professionals handle all aspects of your recruiting and hiring. These engagements are typically one to five years in duration, take three to six months to implement, and literally transform hiring by leading to more efficient processes, a better employment brand, and higher quality hires.
For companies that already have a strong internal talent acquisition function but need extra help for hiring surges, part of the hiring process, or part of the requisition profile, project RPO can be a way to augment a strong model. These engagements are typically shorter (three to 12 months), involve direct integration with existing talent acquisition team members and the RPO provider, and may include only parts of the process or hiring profile.
A well-scoped project RPO solution with the right provider can be a great way to handle more and maintain quality of service to the business. But what do you need to know to determine if it’s right for your company?
Determine the context. Think carefully about how long you will need the RPO service, what kinds of requisitions will be in scope, and what steps in the recruitment process will be executed. In my experience, a project duration of less than three months may not make sense. Why? Because RPO integration always involves a major commitment and investment in time, work, and resources to implement. If your need is for less than three months, it may be better to hire a staffing agency, contract recruiters, or get by with what you have.
The SOW needs to be substantial enough to justify the investment and attract a RPO firm. If you’re opening a call center and need 250 new hires in three months, that can be a great RPO project. If you have a one-time need to fill 20 jobs over three months, that isn’t as clear of a value proposition. Now let’s say those positions are critical, revenue-generating jobs and you can project those people are going to generate $3 million in revenue next year; in that case, investing in project RPO makes sense.
So, duration and SOW are your first two criteria to determine if Project RPO is a route for you.
Build a solid business case. Anytime you hire a RPO firm, you need to justify the investment of time, money, and people to ensure true ROI. In the past RPO was leveraged to cut costs from recruiting, but the value proposition now is more tied to value creation. RPO firms leverage experience to improve efficiency, strengthen your employment brand, improve retention, and improve quality of hire. All of these things can positively impact revenue. So, while your recruiting costs may not go down, your ability to generate revenue goes up.
But, since RPO comes with a price tag, your leadership will need to see the numbers. You can’t hire a RPO provider just because your recruiters are stressed and overworked or because you want to make the recruitment process easier. You need to be able to tie the RPO firm's potential impact to specific business outcomes, i.e., lost revenue, lost people-hours, or lost opportunities. Every business case will be different, but you need to find meaningful financial ROI.
Evaluate the operational impact. It’s also critical to examine the operational impact that the RPO partnership will have on your current team and ensure alignment. Why? Because two negative things may happen without alignment. One, the wonderful talent acquisition team that you've built may feel marginalized once they know you’re hiring a RPO and become disengaged or quit. Two, your team could feel animosity towards the RPO team, which would then make it difficult for the two teams to "play nice."
Whether your RPO team is going to take a specific project and handle it completely or if you are only hiring them to work in conjunction with your existing team, you need to be thoughtful about how they will work together.
You also need to consider how you will onboard and manage the RPO team. There is real, extra work to be done to implement RPO. Do you have capacity to manage their engagement?
Be picky in choosing a qualified provider. Because of the shorter duration, you will need to refine your requirements of a project RPO provider. With an enterprise RPO solution, providers have months to shift or hire resources to dedicate to your account. In project RPO, the timeline is shortened. The provider needs to be ready now with the expertise for your specific job profiles and staff in your geographic locale. Be sure to talk with potential providers about their current workload, where they have done similar work, who they are going to assign to you, where those resources are located, and what previous experience they have with your specific job profiles. There simply isn’t time to learn on the job.
When everything aligns, project RPO is a great way to augment your team and meet hiring goals. Just be careful that you do your homework, vet providers thoroughly, and prepare your team to collaborate well with their RPO teammates.