RPO & StaffingTalent Acquisition

Trade Groups Accelerate RPO Market’s Growth

With buyers and providers collaborating on common goals, recruitment process outsourcing adoption is sure to increase.

by Andy Teng

How can you tell when a developing market is maturing? One telltale sign is how organized its trade group has grown. And judging by the progress that the recruitment process outsourcing business has achieved, it appears RPO has become a fully accepted way of delivering recruitment services in an HR organization.

It was only a few years ago that end-to-end RPO services first started showing up in HR organizations in the U.S. and Europe. Today, the market is more vibrant than ever, bolstered by widespread adoption by large and mid-size employers who are outsourcing both projects as well as their entire recruitment function. In a number of instances, organizations are treating external RPO vendors as an extension of their HR functions; others simply turn to RPO when they need to scale up quickly or find qualified candidates for hard-to-fill jobs.

But don’t just look at market growth as a sign of industry maturity. That RPO service providers and buyers are organizing themselves through several industry trade groups speaks volumes about how mature the business has become. For instance, an effort to organize a special-interest RPO buyers group is being spearheaded by Sheila Gray of International Paper. The movement is to help buyers benefit from each other’s experience with outsourcing recruitment services.

Additionally the RPO Alliance, an established special interest group of the HRO Association, has served vendors for several years. It was originally founded to help the industry educate and clarify questions about RPO. More recently, an independent group, the RPO Association, was started by a handful of providers and consultants involved in the recruitment market. Negotiations to merge the two groups are underway and appeared likely as of press time, according to several industry sources.

Perhaps just as telling as the groups themselves is the work they are undertaking. These associations mainly facilitate the dialogue between buyers and providers, essentially helping the two sides to shorten the engagement cycle. For instance, the RPO Alliance recently formed its Outreach & Event Committee, comprising both buyers and providers. Participants include representatives from companies such as Hertz, Grainger, MetLife, CA, Spherion, Futurestep, CDI, PeopleScout, and others.

Annamarie Phillips, vice president of Spherion’s RPO practice and the chairwoman of the committee, said the committee wants to serve as a communication vehicle for the industry and to help accelerate RPO’s maturation. The group will stress best practices and raise awareness about RPO engagement to help all stakeholders. This will be done through outreach efforts as well as “roadshows”—regional events aimed at educating buyers on the marketplace. So far, four events have been planned.

Phillips said the committee hopes to educate the industry on issues such as sending out requests for information/proposals. In fact, at one of the conferences, sourcing advisory firm TPI will discuss maximizing the RFI/RFP process. She noted that this has become an important issue for buyers and providers alike because often the two sides have disparate expectations of the process, which can lead to a longer engagement cycle. By educating all stakeholders in the industry on the most efficient way of executing deals, Phillips said the committee hopes it will further accelerate the RPO industry’s growth.

“For organizations that have never done RPO, the best way for the best outcome is that everybody has to do good due diligence upfront to ensure they can create a solution that is an effective one for the HR organization and to price that out in a way that’s appropriate for the organization. All of these contracts have to be win-win,” she added.

Part of the challenge, she pointed out, is that procurement is often involved in the process, and it has a very rigid process for qualifying proposals and determining the winning bid. However, while HR might have a good understanding of RPO’s value proposition, procurement doesn’t, and that may lead to an inappropriate RPO vendor selection, she noted.

Phillips also said that she would like to see buyers and providers focus as much on process as on recruitment. She noted that a number of providers in the market have placed emphasis on recruitment capabilities, but as the name RPO implies, implementing a better process is also key to this outsourced model. To do that, the committee will reach out to a broad array of stakeholders for their input, including generating more whitepapers and procuring the perspective of various buyers. “We need practitioners who really understand the entire recruitment lifecycle,” she added.

As the committee ramps up its work, it will likely collaborate more closely with other industry associations to keep RPO evolving for the betterment of the industry. Although each one will have its own objective, collectively they all have a common goal: to make RPO a more effective tool for practitioners.

Tags: RPO & Staffing, Talent Acquisition

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