Big companies are increasingly relying on recruitment process outsourcing as part of a strategic approach to recruiting that allows them to tap best-in-class technology, top recruiting talent and advanced performance metrics.
This is good news for RPO vendors, who’ve seen their businesses steadily grow. But it has also put them on the hook to provide an increasingly sophisticated set of tools and services to keep these clients engaged.
Today’s RPO customers want their vendors to do more than just fill seats, said Stacey Cadigan, principal consultant for Information Services Group, a market intelligence firm. They are looking to them to build their employment brand, increase passive candidate engagement and improve personalization in the application process without losing efficiency.
“Those services used to be differentiators,” Cadigan said. “Now they are expected.”
RPO vendors are responding. In recent years they’ve added a variety of recruiting technologies to drive engagement and brand awareness for clients, including digital marketing tools, video interviewing, and mobile job application and follow-up features. They are also working with clients in a consulting capacity, adding “brand specialists” who work with clients to help them highlight their brand message across all of their candidate touchpoints.
“Branding has become such a critical part of the RPO delivery model,” Cadigan said. “It filters into every aspect of the recruiting process.”
The Challenge: Merging Good and Fast
Clients may want a more robust suite of services from their RPO providers, but that doesn’t mean they are letting go of the key performance metrics that drive this business model. Time to hire and cost to hire are still key measures of RPO success, said Dan Oakes, senior vice president and general manager of Randstad’s RPO business in North America. That’s forcing vendors to juggle sometimes competing demands to create a personalized and engaging candidate experience that is also fully automated to increase efficiency.
“The challenge is how to best combine the technology and the human experience,” Oakes said.
One way Randstad is addressing this issue is by developing more complex talent community tools that proactively seek out and engage passive talent, so they are already warm when a position becomes available. It is similar to a talent community, but rather than passively storing data on anyone who applies, they seek out specific kinds of talent and sort them according to skills and experience, Oakes said. “It will help us get candidates to the client as fast as possible.”
Clients also are giving up on their desire to see proof that the RPO is meeting deadlines and cutting costs. “Analytics are a big part of that,” Oakes said. Most RPOs have rolled out a variety of analytics tools including dashboards and weekly reports to track candidate status and other measures. Though Oakes admitted, “No one has really mastered it yet.”
He would like to see the industry get to the point where data is available in real time, and appears as a tickertape running along the bottom of his screen showing constant performance updates. “We aren’t there yet.”
Part of the challenge is the disparate data sets. Much of the data that would provide recruiters with insight into where the best hires come from and the best ways to engage them live inside the company’s applicant tracking system or HR management system. Without that data, it can be hard for RPOs to make connections between past successes and future hires.
This challenge is further complicated by the increasing use of contingent labor, said Stephen Clancy, director of workforce strategies for Staffing Industry Analysts. The company’s data shows contingent workers represented 29 percent of all U.S. workers in 2015, representing $792 billion in staffing buyer spend.
“The penetration of contingent labor is pushing recruiting trends toward total talent management,” he said. That means RPO vendors need to get more creative in the way they source and engage candidates, leverage their networks and keep track of talent once these contracts have ended. “It is generating a lot of debate about the role RPOs play in finding contingent talent.”
Inside Intel: Adapt to Contingent Labor Trends
Most RPOs aren’t yet integrated into the total talent management process, but Clancy predicts they will move in that direction as contingent labor becomes a bigger part of the workforce. “RPOs need to think about how they are going to innovate to take advantage of this ‘known talent’ pool,” he said.
He believes that the vendors who figure out how to integrate contract labor into the broader recruiting and talent management program will gain a competitive edge going forward.
In the meantime, clients should continue to push their vendors to deliver more robust analytics around their recruiting efforts, and keep track of all the talent that moves though the organization, Cadigan said. “Clients should expect their RPOs to innovate, and to provide real-time data to support the decisions they make on their clients’ behalf.”