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What is Recruitment Process Outsourcing (RPO)?

RPO as it commonly called, is a form of business process outsourcing (BPO) where a company or an employer sublets a part or the total recruitment function to an external HR Agency. A RPO may or may not use the clients infrastructure, processes and reporting methodology. Generally there is a prime difference between a RPO service provider and a placement and a recruitment agency. A recruitment agency is held responsible for the results while an RPO vendor is just following the processes and systems downloaded upon it. Recruitment process outsourcing (RPO) is a recent business service model. Recruitment being a professional activity; while the descendants model of human resource outsourcing because companies found that recruiting correct and skilled manpower is a significantly costly exercise and a challenging activity. However, RPO has migrated to a much more complicated relationship between the outsourcing recruiting as an outside agency, although it is considered as two-thirds of the bonding factor between the two parties. RPO is a association between the hiring company and the (RPO service provider) where the branding is taking place of the hiring RPO buyer’s rather than of the RPO provider’s.

Recruitment Process Outsourcing Definition

The Recruitment Process Outsourcing is defined as “a method of business process outsourcing where an hiring company or the RPO buyer handovers the entire or a part of its recruitment cycle to an peripheral vendor. Recruitment Process Outsourcing agencies are allowed to control the complete recruiting/hiring process, or can control one or two parts of the procedure, principally aiding as an logical extension of the hiring company’s HRD”. This description demonstrates that RPO facilities are not subcontracting in the customary sense, as operating along with an RPO provider is far more consultative and time consuming as compared to the conventional method of recruiting.

What are the different types of RPO Services

Occasionally RPO providers will take on a client’s entire recruitment function, as the RPO buyer would like to have some control under their purview. On a regular basis RPO providers agree to extend specific services that are programmed to increase what the RPO buyer or the client is already doing in tis recruitment function, or an RPO provider may also choose to work with the RPO buyers recruiters to give an impetus to their hiring team. We have enlisted few of the major services an RPO provider will offer to its client base;

  • Candidate sourcing: This is the typical vanilla service where the RPO provider sources relevant matching cv’s for its client either from their own database or a portal subscription provided by the client.
  • Compliance tracking: As the name suggests there are many procedures and processes which need to be followed in the recruitment cycle. This activity can also be outsourced to a RPO provider.
  • Reporting and Audits: MIS reporting on the recruitment function and its effectiveness along with cost control and auditing the processes followed.
  • Hiring Manager Training: Training how to interview, screen, shortlist and induct new recruits is also another activity which RPO consultants perform as an external agency on behalf of their clients.
  • Process Mapping: This is another activity which the client may consider out sourcing to an RPO so as to keep a track on the overall effectiveness of the recruitment process. Redundant processes may be identified and removed and kaizen improvement in the processes may be implemented in consultation with the RPO buyer.
  • Technology Consulting: Applicant tracking systems and many other HRM MIS, SAP & ERP systems are available nowadays and clients are quickly adopting technology to have better decision making abilities.
  • Third Party Vendor Management: There are many functions of the HR department where in external vendors are involved. The entire vendor management, billing, service quality and product quality auditing can be outsourced partially of wholly to a RPO provider

RPO providers normally accept total responsibility of the recruitment process and its outcomes. Therefore a RPO provider will not only stretch beyond limits for a client company it will also coordinated with the in house recruitment resources to improve upon the effectiveness of the recruiting processes and recruiting results. Thus easing the task for the clients to hold the RPO agency liable to recruit relevant candidates for the company, and not just filling in the vacant positions.

What an RPO does not represent?

Recruitment Process Outsourcing is often misunderstood and does not mean that the RPO buyer is conducting the recruitment function remotely. It also should not be presumed that the RPO buying company is shrugging its recruiting responsibilities to someone else because of lack of interest or time or any other factor. A RPO agency is not a plug and play solution for all recruitment needs, nor does it replace solution, in-house recruiters or HR Team. By outsourcing some parts of recruiting function to an RPO provider, the in house HR department is not washing its hand from its recruitment responsibilities. The approach has to be top to down and by merely onboarding a RPO consulting company it does not imply that a company is committed to improving its recruitment vertical. With such a thought process an RPO should not be signed up.

What are the indicators that a company should sign up with an RPO

The services of an RPO should be only sought for when a hiring company is looking for a hiring solution other than the standard head hunting or executive search placement method. Under these needs will tying up with a RPO make sense. This is because a RPO service provider is a serious empanelment methodology than the standard placement sourcing contract. It is like a company is partnering with some external agency for a critical resource. It is not only a commercial agreement. It involves a lot of commitment from both the RPO provider and the RPO buyer towards each other to make the association a win-win one. The relationship so formed has to be committed to creating an employer branding process which will enable the hiring company to attract and retain talent rather than just increasing the head count with qualified members.


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