evaluating

talent acquisition models -

is RPO the
best fit solution?

the
right
RPO
its all about the right strategy
and the right partner
introduction
The western economy is showing
positive signs of revival and
businesses are looking to grow
and drive expansion in emerging
markets such as India and China.
In the wake of the recent
economic and market volatilities,
enterprises both big and small
are working to control costs and
maintain a healthy pipeline of
talent capable of superior
performance that can take the
organization to higher levels of
business efficiency. HR leaders
across the world have been
2 The Right RPO series | evaluating talent acquisition models: is RPO the best fit solution?
facing major challenges in
recruiting the right people at the
right time and at the right price
point. Human capital being the
force that fuels business growth,
there is a rising pressure on HR to
maximize recruitments while
maintaining optimal levels of
cost control.
Given this scenario, the HR
function has certain options to
choose from a) build an
internal recruitment team b)
outsource the recruitment
function partially and c) engage
with a competent external
partner for end-to-end
recruitment support. The ability
to choose the right solution to
meet organizational human
resource needs will clearly
depend on evaluating the
benefits of each option and
building a solid business case
that can justify both the
short-term and long-term
recruitment strategy.
recruitment
challenges
faced by HR
Before selecting the right recruitment strategy, it is critical to identify the
various challenges and pitfalls HR faces on a daily basis by assessing the
current situation based on a holistic view of both internal processes and
external forces. RPO is about solving critical business challenges and hence
prioritizing the issues faced by HR becomes paramount. Some of the typical
challenges HR leaders in many organizations face include:

scalability access to talent

Sudden demands of increase in workforce has a
direct impact on the organization with more
pressure on the HR function. The main question is
whether the internal talent acquisition teams are
equipped to scale and de-scale to meet these
fluctuating demands. Often the choice of
changing the recruitment strategy is tied to a
company's operations or strategy, including
challenges around growth such as globalization
or shrinking markets.
Another common driver relates to challenges in
identifying, attracting, and recruiting the right
talent at the right time. Organizations often
encounter issues such as hard-to-find skills in
short supply, geographical challenges, the need
to build employer brand attractiveness, and the
activities of competitors. The ability to engineer
solutions to meet these challenges comes from
access to the right recruitment expertise backed
by the latest tools, methodologies, and analytical
processes necessary to devise a successful strategy
and make key talent recommendations.

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cost control
Organizations are under a lot of pressure to improve their profitability and shareholder
return. There is a need to consolidate not only internal hiring costs, but costs pertaining to
external recruitment agencies as well. Then again, both direct and indirect costs need to be
factored in while devising strategies to ensure enhanced cost efficiencies. Given below is a
simple representation of the various costs involved in internal recruiting. Opportunity costs
pertain to HR initiatives that suffer due to lack of attention or huge management time
consumed in the recruitment process.

direct costs indirect costs opportunity costs

Team cost of employees Unfilled vacancies Employer branding initiatives

Cost of external tools -

Employee engagement
job boards, technology Poor quality hires
programs
platforms, assessment, etc.

Talent management strategy

Interviewing High attrition rate
in alignment with business

Onboarding and induction Greater time-to-hire

process efficiency
Process efficiency is directly linked to quality,
time, and cost that most often manifests through
protracted time-to-hire and limitations of the
tools available to recruiters. The net result of this
is difficulty in meeting demand or a reliance on
additional resourcing personnel. Decentralized
recruitment processes result in increased costs and
time-to-hire while diminishing the candidate
experience and employer brand.
visibility and
measurability
Recruiting is a continuous pipeline development
process that is built through extensive processes,
systematic improvements, and measurable
accountability. HR generalists have multiple
priorities and limited bandwidth to gain visibility
on recruitment metrics, talent mapping, supply
and demand, and candidate experience. Data,
metrics, and analytics are very important and
provide a comprehensive view of the current
recruitment processes and systems, highlighting
gaps if any.

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best talent acquisition
solution to ensure
seamless functioning
From the perspective of the above challenges faced by HR in the recruitment process,
three possible approaches can be evaluated to ensure smooth functioning of the
recruitment activity:

1. Internal approach Building an improved team and capability internally

2. Partial outsourcing Retaining an internal capability but engaging with external
partners for some parts of the solution
3. End-to-end outsourcing Contracting an external partner with the right expertise to
deliver comprehensive recruitment solutions

Let us explore each of these options keeping in mind the business objectives,
organizational culture, and future talent and growth strategy. The table below
summarizes these approaches.

end-to-end
critical parameters internal recruiting partial outsourcing
outsourcing with RPO

Cost of services Fixed Fixed + Variable Fixed + Variable

End-to-end accountability Complete Shared Complete

Scalability Fixed Partially flexible Completely flexible

Breadth of service Limited to company Limited to services

capabilities knowledge and skills End-to-end
outsourced

Enhanced competitive
advantage (better visibility, Limited Limited Complete
metrics, employer branding etc)

The following is an examination of the three scenarios that stem from different
approaches to addressing the critical issues mentioned above.

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internal approach
An organization's vision and pre-
defined milestones provide a
broad picture of the structuring
of internal teams, management
of the talent pipeline, and the
relevant recruitment strategy to
be adopted by HR. HR leaders
have to gauge if the current
talent strategy can be aligned to
business initiatives by upgrading
the existing internal team with
the right expertise. With a
dearth of quality talent, the rules
of the employment game have
changed and the power of
choice now rests with candidates
rather than employers. After
successfully implementing strong
internal functions, the biggest
consideration is whether the
organization can attract,
develop, invest in, and retain
candidates for a longer period of
time. To win the war for talent
organizations need to make the
right investments capable of
providing long-term benefits
rather than short-term gains.
Greater transparency in the
internal recruitment process has
always been a challenge and HR
will benefit through better
structuring and hard metrics that
provide clear visibility into
internal team efficiency.
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scalability: It is difficult to set a benefits derived from low-cost
fixed internal team headcount as delivery locations.
demand for talent varies and a
process efficiency: HR functions
fixed overhead cannot be
within an organization can be
justified as cost-effective. This
divided into three separate
depends on the talent strategy
departments depending on the
planned, current talent strength,
activities carried out
attrition level, and the
transactional activities (payroll,
recruitment numbers to be met
compensation, benefits);
by the talent acquisition teams.
recruitment activities, and
access to talent: Candidates now strategic activities (people
have the ability to pick and development, business strategy).
choose, be proactive or passive, This differentiation offers better
and investigate potential process efficiency and visibility.
employers more thoroughly than
visibility and measurability:
ever before. This is where deeper
A complete accountability of
sourcing expertise, a wider
internal teams can often go
candidate pool, technologically
unaddressed as in many cases
advanced tools, and employer
internal reviews rely on strength
branding initiatives need to be
of relationships rather than data.
developed internally to stay
Key metrics like cost,
ahead of competition in winning
productivity, retention,
the war for talent.
employee satisfaction, etc.
cost control: When considering provide meaningful insights into
upgrading internal resources, the effectiveness of the current
additional costs need to be business and HR strategy.
factored in such as buying,
configuring, and operating the
right tools and methodologies to
ensure best-in-class sourcing and
recruiting systems to access and
map the right candidates. Long-
term investments in creating
shared service centers offer
partial outsourcing
A partially outsourced solution
might seem attractive to some
organizations as it represents the
least change in the current
structure. This requires internal
teams to work closely with
external vendors and clearly
define processes and tasks to be
handled by the vendor with pre-
defined SLAs. Partial outsourcing
has both its advantages and
disadvantages. Many
organizations usually outsource
their transaction intensive
operations such as payroll
processing, recruiting,
background reference checks,
employee benefit issues, etc.
allowing HR teams to focus more
on high-priority strategic
functions such as training and
development, employee
communication, and
performance management.
When specific issues arise outside
the expertise of internal teams,
subject matter expertise from
vendors comes in handy. For
example many organizations
partner with outside resources to
develop the strategic HR plan
and create a tactical structure to
align and support with business
strategy. This approach may
provide access to external
expertise to address key issues,
but the question HR leaders
need to consider is how to
define the accountability of the
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external party so there is enough
incentive to drive investment
and show measurable results.
Since the vendor would not have
complete visibility into an
organization's HR and
recruitment strategy, seamless
communication and coordination
between internal and external
teams is essential for better
efficiency and productivity.
scalability: Partial outsourcing
can address hiring fluctuations
like seasonal peaks and troughs
but there will also be pressure on
the external vendor to cover
some risks in the commercial
agreement due to limited
visibility of demand and scope.
Access to talent: Recruitment
vendors have access to a wider
candidate database and refined
sourcing and validation
methodologies. Vendors are
experts in what they do which is
why internal HR teams can
utilize the vendor's expertise in
areas that require more support
in the recruitment cycle.
However, this can hamper a
consistent brand message and
candidate experience if multiple
recruiters contact potential
jobseekers.
Cost control: Partial solutions
offer access to more efficient
cost structures, but the impact
depends on the governance and
process steps required to ensure
seamless operations between
internal and external teams.
Engaging with multiple agencies
reduces visibility into the total
spend by the agencies and
internal recruiting teams.
Process efficiency: Only effective
synchronization between
internal and external teams
produces the desired impact.
When only a part of the
recruitment process is
outsourced, different teams are
likely to use different
recruitment approaches and
methodologies making
standardization difficult to
achieve.
Visibility and measurability:
External agencies can easily
provide the necessary
recruitment metrics for which
they are accountable. However it
can be a challenge to link hiring
metrics and analyze the
performance of multiple
agencies and internal teams to
provide a 'big picture' to the
management. Moreover metrics
related to candidate satisfaction,
cost efficiencies, and the talent
pipeline would be hard
to decipher.
end-to-end outsourcing
In an RPO engagement,
ownership of the recruitment
process is transferred to a
competent RPO partner. By
engaging with an end-to-end RPO
partner, all recruitment activities
are consolidated under one roof,
thereby maximizing productivity
and minimizing risk. RPO follows
a holistic approach when offering
the right solution that introduces
simple yet effective processes.
Once these best practices are
identified, tested, and
implemented, it becomes easier
to adhere to process compliance.
This end-to-end approach
provides the greatest impact
because it fully benefits from the
advantages RPO offers
advanced tools and
methodologies, dedicated talent
acquisition professionals with the
desired consultative experience,
and access to a wider pool of
qualified talent. Then again, by
taking over complex labor-
intensive tasks, RPO enables HR to
focus time and energy on
working closely with the
management to align talent
strategy with business goals.
A single RPO vendor helps in
reducing the cost of engaging
with multiple agencies by utilizing
time and cost saving tools,
deploying advanced technology
and analytics, and ensuring
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detailed reporting that improves
decision making and strategy
development. RPO specialists
collect, analyze, and interpret
data, delivering insights and
recommendations that enhance
operational efficiencies and
business effectiveness.
scalability: RPO solutions can
quickly scale up or down to meet
long-term talent acquisition
plans and new project
requirements or on-demand
hiring depending on the
organization'sneeds.
Access to talent: RPO proactively
creates a talent pipeline
consisting of active and passive
candidates through candidate
mapping, social media, and
other brand outreach programs
that cannot be built through
traditional recruiting methods.
Successful RPO models provide
value adds like incorporating
employer branding initiatives to
narrow down the candidate
selection criteria and ensure the
right job-boss-company fit. This
model not only selects talent
based on job descriptions but
appeals to the culture and
working environment of the
organization to recruit the right
candidates, improve hiring
manager satisfaction levels, and
reduce attrition.
Cost control: There are three key
benefits of engaging with an
RPO partner:
Since RPO providers operate in
a competitive environment and
the accountability entirely rests
on them, there is constant
pressure to deliver more value
at optimal cost.
Long-term investment in the
vendor's operating models is
shared across their entire client
base rather than on a single
client.
Cost is more variable than
fixed, resulting in greater
visibility, control, and business
alignment.
An RPO model offers both long-
term and short-term savings to
the client by increasing cost
efficiencies through recruitment
process expertise, proven
methodologies, and improved
process enhancements.
cost savings through RPO

short-term savings long-term savings

Reduced time-per-hire Lesser attrition rate

Reduced cost-per-hire Improved processes and best practices

Improved interview-to-offer rate Better visibility through the use of analytics and metrics

Better offer acceptance rate Increased competitive advantage

Reduced job posting timelines Reduced usage of multiple agencies

Process efficiency: An RPO provider adopts a holistic approach to designing and

implementing effective recruitment processes in a centralized, consistent way. By
getting involved in the entire process right from workforce planning to onboarding
and candidate support, RPO helps centralize the recruitment process thus
standardizing best practices, managing compliance issues, and minimizing risk. Along
with cost savings, RPO streamlines the recruitment process, enabling hiring managers
to source and hire specialized talent and reduce the time-per-hire.

recruitment process

candidate
workforce requisition pre-screening offer & hiring
sourcing interview onboarding
planning process & management manager
& selection
assessment support

Visibility and measurability: RPO helps time to fill

organizations identify and manage critical KPIs speed Open Req Aging
related to the recruitment process like fill Time to Submit Hired Candidate
ratios, cost-per-hire and ROI, time-to-hire,
fill ratio
hiring manager satisfaction levels, employee
delivery Source of Hire
engagement and retention, and quality of
Diversity of Sourced Candidates
hires. Clear KPIs are documented and owned
such that they can be measured and can Submitted to Interviewed Ratio

contribute to continuous business Hiring Manager Satisfaction

improvement. RPO also provides insights on quality Attrition

non-recruitment data such as detailed labor Candidate Satisfaction
analysis, demand-supply, talent landscape, Offer Letter Accuracy
competition analysis, market mapping, future
cost Agency Utilization %
hiring trends, etc. Some of the KPIs usually set
for RPO partners include Speed, Delivery,
Quality, and Cost.

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conclusion
With the right information it is easy to compare, evaluate,
and identify the specific recruitment management option
capable of providing greater value to the organization. RPO
should not be seen as a mere cost control model but as a
solution that resolves critical business challenges and boosts
overall recruitment process efficiencies. When taking a
business decision of choosing the right recruitment strategy it
is important for all key stakeholders including HR, CEO,
Finance, Procurement, and hiring managers to have clear
visibility and influence over the decision so that the transition
is smoother with minimal roadblocks.

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 the right
RPO

RPO has found a strong foothold
among the HR fraternity and in
simple terms, it denotes
organizational strategy to utilize
an external partner to manage
some or all activities associated
with recruitment. Unlike a typical
recruitment agency, an RPO
partner comes with the required
expertise to provide highly
scalable and consultative
recruitment services focused on
achieving optimal hiring results.
Clients may engage an RPO
partner to supplement their
entire talent acquisition function
or to manage limited scope
services for particular businesses,
positions, initiatives, projects
and/or geographies. The success
of an RPO engagement depends
on the service provider as every
RPO partner comes with specific
strengths individual to their
business offering. A partner with
advanced capabilities; experience
spanning global markets,
geographies, and industries;
ability to scale; and offering a
breadth of end-to-end services
can help an organization reap
maximum benefits by addressing
various recruitment needs and
challenges.
In this context, it is about
acquiring the right RPO solutions
offered by an expert partner,
which will go a long way in
meeting an organization's
requirement for human capital.
Right RPO is governed by four
fundamental pillars that are
critical to the successful execution
of an RPO strategy Scalability,
Quality, Speed, and Brand.

The 4 pillars of Right RPO are

scalable access to business critical

01 scalability talent when & where
you need it 03 speed roles filled faster to
impact bottom line

higher quality enhanced employer

02 quality talent aligned to
your business vision 04 brand brand, diversity &
competitive position

11 The Right RPO series | evaluating talent acquisition models: is RPO the best fit solution?
 shaping
the world
about Randstad India of work
Randstad India offers the broadest HR
services portfolio ranging from Staffing,
Search & Selection, to Recruitment Process
Outsourcing (RPO). The organization has a
vast network of offices across the country
to ensure maximumclient and candidate
outreach. Randstad is the second largest
global HR services provider active in 39
countries across the globe. Randstad India
continues to focus on developing
customized and innovative HR solutions
through a wide geographical presence and
end-to-end service capabilities across all
HR functions.

Randstad can be your Right RPO partner in

providing tailor-made RPO solutions that
can help you create measurable business
impact. For more information write in to
us at sales.enquiry@randstad.in or call us
on 1800 2674050.
Visit us at www.randstad.in