Recruitment Process Outsourcing : Changing Strategy

For years, recruitment process outsourcing was viewed as an efficiency play with big companies tapping outside vendors to hire a lot of low-level people as quickly and cheaply as possible. But times, they are changing’. Today’s RPOs are being brought in specifically to unearth the hard-to-find talent that companies need to fill highly specialized and critically important roles. 

HR services and staffing firms globally are expanding their teams and operations to cater to the rapidly growing demand for recruitment process outsourcing (RPO) as organizations increasingly farm out all or part of the hiring functions to focus on their core businesses. This is driving large and midmarket companies to use RPOs more strategically — streamlining their own recruiting process while reducing the burden on HR — and to use vendors’ expertise to build their social media brand and presence to connect with a broader candidate pool. 

There is an increasingly sharper focus on understanding of the Indian market for RPO projects, Corporates are looking not only for a specialization in sourcing but also in processing and technology, to which attention was not paid a couple of years ago. A few months ago, Principle RPO inked a deal with Major tier 1 agency PPP worth $3 million according to Global RPO report 2015, for a period of five-seven years. Principle RPO provides platform based RPO solutions, taking end-to-end ownership of permanent recruitments for its clients. It has seen addition of 10 new RPO clients every year and growth of about 100 per cent over the past one year alone.

The top three growth drivers for the RPO boom in 2015 are the need for organizations to enhance quality of hiring, reduce cost of hiring and increase speed of hiring.

Organizations are moving up the value chain, from outsourcing one or two processes and short-term projects to end-to-end RPO that includes everything from sourcing, scheduling, selection to job offer roll-outs and on-boarding hires. As hiring increases and the war for talent intensifies, more and more companies are expected to outsource their recruitment process work. This model helps provide a cost-effective and consistent talent acquisition process, keeping turnaround time low and allowing companies to scale up quickly when the business environment improves.

In India, software, technology and IT sectors are the major torchbearers for RPO growth. However, mid-sized to large companies in manufacturing, telecom, pharmaceuticals, healthcare and banking sectors are also driving demand In the global market, multinational companies are increasingly seeking a single RPO service provider across multiple locations, with India being one of the primary markets. Companies are moving towards regional shared service centres for HR and this is bound to see an increase in global RPO programs.

One of the biggest advantages TPG gained is his ability to be flexible around talent acquisition. PRG’s business is seasonal, and based on crop prices, the company often has to ramp up hiring for a while, and then tamp it back down. “Outsourcing recruiting has given us the best of both worlds

The growing demand for hard-to-find skill sets, coupled with the looming talent crisis, has been a boon for RPO industry leaders who were able to transition themselves from being transactional, low-cost providers to strategic HR partners — though it left other RPO providers in the dust. The shift in what customers want from their RPO providers has caused a dramatic change in the industry makeup over the past five years, with former leaders dropping off industry top 10 lists, while new players have risen to the top .