RPO as your recruitment strategy in difficult times

From the November 2008 issue of Ceridian Connection.

You may have heard of Recruitment Process Outsourcing (RPO) and dismissed this option because you consider recruitment too important to your organization to outsource. Or perhaps, facing today's economy, you are busy reviewing your staffing plans and determining how your company is going to weather the economic storm.

While the Bureau of Labor Statistics has been reporting job losses and higher unemployment for several months, you are challenged to find the right candidates for your business, when you need them and for the least cost per hire. Even in this softer job market, organizations are looking for new methods to source, onboard and retain qualified candidates. The traditional methods of disparate recruitment functions and outsourcing to multiple vendors (staffing, technology, screening, etc.) do not meet today's requirements to compete effectively in the global marketplace. They also are difficult to manage in terms of quality and cost efficiency.

When you are held tightly accountable to the bottom line, it can be easy to believe that keeping your recruitment activities in-house is the safest option. You might feel that you will have more control and oversight. However, the risk is that by maintaining the status quo in your recruitment practices, you may actually have the opposite effect and negatively affect your bottom line. Taking advantage of a RPO in a questionable economic climate is one way to keep your organization lean and efficient.

When considering outsourcing, you might think that you do not have the budget or the staff to explore or manage such a sweeping change. You might believe you are comfortable with your current recruitment process, results and spending.

Take the time to objectively consider the best recruitment strategy for your company in this economy by answering the following questions:

• Do you have a solid and accurate grasp of your cost per hire?


• If your HR generalists are tasked with partnering with your hiring managers to recruit, what is the "opportunity cost" to the organization of their time spent recruiting versus workforce planning?


• Assuming you have the technology and staff in place to manage your recruiting efforts internally, how is this team accountable to the quality of candidates, the cost of their sourcing efforts and the time in which they are filling positions?

Organizations turn to RPO for a variety of reasons. According to the Aberdeen RPO study released in March 2008, "a lack of internal HR resources is the number one reason that companies turn to RPO."

Additional driving factors include:

• A reduced turnover through improved quality of candidates.


• An accountability to management that creates a need for detailed cost management and a forecast of staffing and workforce planning -- backed by verifiable metrics.


• The need to better manage/reduce recruitment spending/total cost per hire.


• The need to free HR resources to focus on more strategic talent management and workforce planning initiatives.


• The need to better manage and reduce costs of using a third party (staffing agencies, screening, etc.).


• A transformation to centralize a decentralized recruiting function.


• The need to control global staffing requirements through one centralized service center and technology to increase oversight and control of recruitment activities and spending.

These challenges all provide a case for RPO by outsourcing the transactional, administrative tasks associated with recruiting. This allows the HR and talent acquisition functions the necessary time and resources to focus on strategic, talent management concerns driven by the bottom line. Supported by verifiable metrics from their RPO provider, HR is able to influence better decision making and improve workforce planning efforts. The review of RPO has led many companies to realize that a lack of sufficient internal information and data prevents accurate calculation of their cost per hire.

If you choose RPO, you can benefit immediately from a recruitment team that can quickly scale to meet your hiring needs. If your hiring needs are reduced, you do not carry the overhead of a recruiting department. When the economy begins to turn around and you need to hire more employees, the RPO team is in place and can be quickly ramped up to meet your needs -- at no additional cost. An RPO team's success is tied to stringent service levels, providing a high level of accountability to performance and cost that is often difficult to build and enforce with an internal team.

Ceridian's burgeoning RPO practice has clients across North America. These clients have reported the following gains from their strategic partnership with Ceridian:

• A reduction of 80 percent in third-party agency expenditures within one year.


• A reduction in time to fill positions (showing a return to the bottom line over $1million by not having key sales positions unfilled).


• Lower turnover rates due to better hires.


• Improved global reach for hard-to-fill niche positions.


• Improved employer brand.


• Increased HR's time to focus on greater talent management issues.

Consider RPO as a long-term, strategic approach to building a strategic talent management function. The RPO partnership can relieve you of chores associated with recruitment and provide a fixed cost per hire backed by stringent service level agreements. The value of increased quality of candidates, reduced time to fill positions and improved time to productivity of new hires can directly impact your bottom line. Through the establishment of best practices presented by an RPO provider, organizations of all sizes are realizing the benefits of outsourcing their recruitment processes.

If you are ready to explore your options with RPO, visit Ceridian's Recruitment Process Outsourcing page for more information.