Why the SourceRight-Hays deal came at the perfect time for one high-tech client.
By Russ Banham
Sometimes in business, a coincidence has a way of breaking new ground. Such was the case when JDSU, a worldwide provider of highly innovative broadband test and measurement solutions, sought a novel global solution to its permanent staffing and temporary workforce hiring needs.
Based in Milpitas, California, JDSU provided optical technology that assisted the 3-D effects in the blockbuster movie Avatar. It is no boutique, however. The company generates $1.3 billion in revenues and employs approximately 4,000 employees at 80 offices serving customers in 160 countries. Its workforce, like most companies’, comprises both salaried, fulltime executives and staff and contingent employees.
In 2007, seeking to implement a scalable, cost-effective recruitment solution to complement its internal team of recruiters in the United States, JDSU engaged outsourcing vendor SourceRight Solutions, a division of SFN Group, to provide RPO (recruitment process outsourcing) services. Previously, JDSU had engaged SFN to provide MSP (managed service programs) to administer its contingent workforce functions. In effect, the same vendor provided both hiring services—an important trend in the HRO industry.
Given JDSU’s wide global footprint, in addition to its satisfaction with the RPO-MSP engagements, the technology company took the next logical step—seeking an RPO/MSP solution similar to the one it had in the U.S. for its non-U.S.-based hiring needs. It also had an outsourced talent acquisition vendor in mind. “We had opened up discussions with Hays in the U.K. to provide both RPO and contingent workforce outsourcing solutions, not knowing at the time that they were simultaneously engaged in discussions with SourceRight to form a global alliance,” says Mindy Aiello, senior manager, global talent acquisitions, at JDSU. “No sooner had we selected Hays as our non-U.S. provider when the alliance was announced. It turned out to be a coincidence that has really worked to our advantage.”
SourceRight and Hays struck their deal to establish a strategic alliance in March. Each provider brings to the table both complementary recruitment services and a broad base of geographic locations to provide a range of RPO and MSP services to JDSU and other multinational clients. Overnight, the alliance could tout its position as one of the world’s largest such global talent acquisition providers, combining and tailoring their specialized recruitment offerings and candidate outreach strategies to specific industries, countries, and cultures.
For JDSU, the deal broke at the perfect time. “We will now be able to leverage our U.S.-based RPO/MSP model to drive recruiting efficiencies across our global operations,” Aiello says.
When a Marriage of Convenience Serves the Client
The strategic alliance between SourceRight and Hays is predicated on providing the full range of RPO and MSP services to multinationals as the hunt for talent becomes more global and competitive in the tight labor marketplace. “The hiring demands of our clients from a global perspective is what initiated everything,” says Jennifer Beck, vice president of operations and general manager at Fort Lauderdale, Florida-based SourceRight.
“Clients kept saying to be successful they needed to be global. We needed to follow suit, and felt the most effective methodology, after much due diligence, was a strategic alliance.”
London-based Hays already had experience serving pan-European clients’ RPO and MSP needs, but it lacked a viable U.S. presence. “The RPO and MSP markets in the U.S. are a few years ahead of us, in terms of maturity, innovation, thought leadership, and development,” says Les Duncan, managing director of corporate accounts at Hays plc. “SourceRight is a key player in this market, and we had no real ambitions in the short-term to compete in it—hence the benefits of an alliance.”
Arm-in-arm, the partners are equipped to offer a formidable array of MSP, RPO, and contract compliance services on a broad geographic basis. Together, they serve clients from more than 100 sites within 30 countries (SourceRight with 675 offices and Hays with 340), have 17 specializations and verticals, and are able to leverage the knowledge gleaned from serving 75 RPO customers combined, a figure believed to be the largest in the marketplace.
All this and more—both firms have particular expertise in understanding employment law in diverse countries—is in the process of being aggregated to serve JDSU, the alliance’s first client. As Duncan sees it, “They’re getting the best of both worlds.”
Aiello agrees. “We’re leveraging ‘lessons learned’ from our RPO and MSP experience with SourceRight and SFN since 2007—what’s worked well and not so well—while bringing the ‘best practices’ of Hays to the table,” she says. “As they now learn from each other, we become the beneficiary of a much better talent acquisition solution.”
The signature value proposition for JDSU, she says, is its newfound access to a single, global program for both RPO and MSP that provides a “consistent look and feel for our hiring managers around the globe—especially when they are crossing borders for talent.”
She elaborates that, “It’s so important that our hiring managers have the same experience regardless of where they hire talent. One of our strategic initiatives here is the implementation of processes that are lean, efficient and simple. We don’t want managers to struggle doing things one way with talent in China and another way somewhere else, whether it’s contingent workers or traditional ones.”
A major objective in the novel engagement is cost savings, one that JDSU can expect to achieve by narrowing its talent acquisition vendor relationships to two and ultimately one—Source Right, via the alliance. “JDSU will get more consistent pricing and control over costs,” Beck says.
But, the overarching goal in any RPO or MSP outsourcing decision is acquiring the best people for the right jobs. In this, Aiello is sanguine: “We’re gaining access to the largest network of professional skilled labor in the market.”
Stuff to Do
All three participants acknowledge that they’re only at the beginning of a very long journey together. Beck notes that the outsourcing partners are in the process of aligning their respective operations—sales with sales, regional executives with regional executives, president with president, and so on. “Right now Mindy is conferring with both of us, because it is such a large engagement, but as we go forward the goal is to have one point of contact,” says Beck.
Technology integration to provide this single point of contact, in addition to reporting requirements, is a key consideration. JDSU presently has an applicant tracking system in place, which it leverages globally. Aiello concedes that it is not the best solution, and she is conferring with the outsourcing providers to “take it to the next level,” she says.
“We’ve got some meetings set up in the next couple weeks with SourceRight to look at the technology it currently uses with clients to see if this might work for us,” she adds. “Ultimately, both vendors will link their disparate systems, and I imagine we will be the first client to benefit from this.” She estimates it will take another three years before a technology solution is forthcoming.
Duncan says that the partners are indeed seeking a common technology platform that would serve JDSU and other clients’ global reporting needs from a metrics standpoint.
“A single point of contact will permit better account management—for example, whose feet to hold to the fire if things don’t work out,” he says. “If the client is U.S.-based and we are delivering (talent) in a European country, you need to know who in that country is accountable. As long as we and SourceRight align our priorities, reward mechanisms, and centralization plans, we should have no problems.”
Aiello is confident of the future. But she’s also clear-eyed. “In a perfect world, this will all come together with no blips, but the reality is we’re pioneers here,” she says. “Not many companies have in place a global RPO program, much less an MSP one, with both provided via one point of contract. We’re doing it, and fully expect there will be bumps along the way. Still, we’re making fantastic progress. The outsourcing partners are doing a fantastic job leveraging their best practices and being very flexible about the need to change some processes. This is all ‘give and take.’ But, it’s also very exciting.”
Managing Traditional and Contingent Workforce Recruitment
In the hunter-gatherer days of hiring fulltime, part-time, and temporary workers (read: 1980s), companies turned to an array of recruiting firms on a regional and even local basis to find job candidates and eventually make the hire. Technology and the increasing sophistication of outsourcing service providers have altered the dynamic to a point at which it is now feasible to turn to a single provider for hiring needs across the planet.
Well, maybe not a single provider, per se, but at least one point of contact, as in the case of the strategic alliance recently struck between outsourcing vendors SourceRight and Hays. Both companies have evolved similarly, gradually building out their capabilities to provide both RPO (recruitment process outsourcing) and MSP (managed service programs) services to clients.
In many cases, the MSP part of the service offering might involve several vendors, with the provider acting as a master contractor, i.e., sub-contracting other contingent workforce providers to address localized talent needs. Still, a single point of contact is achieved, along with consequent cost savings and process efficiencies. Hence, the trend in the HRO space toward bundling MSP with RPO to create what is being billed as the “total workforce solution.”
Regardless of the category of talent sought by a company—fulltime, part-time, or temporary—providers such as Hays and SourceRight are positioned to get it. They can achieve their solution either on their own or through key relationships they’ve cultivated in multiple vendor channels. “Offering MSP services in tandem with RPO services is a logical step in assisting clients to gain proper control of the workforce,” says Les Duncan, managing director of corporate accounts at Hays plc. “More of our clients ask for both (services), and we can provide them through our vendor master agreements.”
Why are clients asking? Duncan says they’re placing greater emphasis on long-term talent planning: “By integrating both temporary workforce management with permanent staffing operations, they get a much clearer picture of their workforce requirements now and into the future.”