Recruitment goes beyond simply filling vacancies. With skill shortages, rising costs of local talent and strained internal recruitment departments, recruitment service providers are stepping in to help organizations find, deploy and keep talent for all skill levels and roles. Recruitment service providers manage the entire hiring process, from job profiling and applicant screening to training, support and monitoring of new staff. Besides skilled manpower, the vendor often provides technology, methodology, analytics and reporting. Unlike contingency and temp staffing companies, recruitment service providers have the capability to assume end-to-end management of the recruitment process, focusing on value-driven services. Recruitment models include in-house management, hybrid recruitment process outsourcing (RPO), project recruitment, and full RPO.
Market and Trends
Research and consulting firm NelsonHall estimates that the global recruitment process outsourcing market reached about $4.4 billion in revenues by 2015 (Targeting RPO, NelsonHall). Only 17 percent of organizations use end-to- end recruitment process outsourcing, while the majority (60 percent) use RPO selectively for hard-to-fill roles or for certain elements of the process, according to business research company Aberdeen Group.
Globally, companies face a shrinking labor pool, where more people (and more talent) are leaving the workforce than entering it. Recruitment experts contend that the number one problem stalling the recruitment process is the shortage of skilled staff or lack of quality hires. Other top recruitment problems are location issues, uncompetitive salaries, and issues with current recruitment processes. Companies are feeling pressure to tap new sources of talent, such as professionals in emerging markets, freelancers, and retirees.
The global workforce is also evolving in terms of its needs and expectations. Some of the factors affecting recruitment are increasing competition for talent and increased focus on efficient hiring decisions.
An example of a successful RPO partnership is between a Fortune 100 financial institution and a recruitment solutions vendor hired to improve top line revenue by hiring qualified and experienced financial advisors across all branches. The outsourced recruitment service provider developed a custom, end-to- end RPO solution to recruit the financial advisors. This led to an increase of over 20 percent in revenues and retention rates and a 15 percent increase in diversity; and a reduction of over 45 percent in days to fill.
Recruitment Challenges and Solutions
Recruitment has become increasingly complicated across industries and for businesses of all sizes. The biggest challenge for organizations today is finding the most qualified and skilled candidates in a competitive global marketplace. Adding to the pressure are changing staffing needs. Costs can multiply when a company needs to recruit multiple professionals within a very tight timeframe. Internal human resource departments may be overtaxed by the demands of recruitment on top of their core responsibilities, particularly by large-scale projects that require multiple hires at a moment’s notice.
Limited internal resources, common among many small and medium-sized businesses, can also make recruitment a slow and laborious process. It is difficult to compete with larger, more established companies for the same talented professionals unless an experienced third party steps up to fill the gap in technology and capabilities.
Outsourcing recruitment to a trusted and experienced specialist is thus an increasingly attractive proposition. According to a 2009 global survey, organizations frequently outsource recruitment and hiring to increase the volume of applications, decrease time to hire, improve the quality of candidates, and reduce recruitment costs. Aberdeen Group reported that RPO users reduced time to fill by 60 percent, improved new hire retention by 55 percent, increased hiring manager satisfaction by an average of 67 percent, and reduced cost-per- hire by an average of 48 percent.
Cost and Process Efficiency
The first wave of recruitment process outsourcing addressed cost and process efficiency issues, and these two factors continue to drive outsourcing initiatives. However, while early adopters focused on cost reduction, process improvement and leveraging technology solutions, today’s enterprises are looking for strategic value out of outsourcing relationships. Recruitment process outsourcing service providers today should be integrating effective talent acquisition and management methodologies with cost reduction and process-focused models to deliver better value.
Value and Innovation
Companies are now more invested in their talent acquisition initiatives, with increased senior management oversight. Talent management is seen as a strategic, integrated system that addresses skill shortage problems. Besides cost efficiency, talent as a competitive advantage is on top of the priority list. Vendors that utilize innovative strategies and capabilities to create value while reducing costs have an edge over those that focus only on cost-reduction. An effective RPO provider integrates people, process and technology to enhance the client’s competitive advantage.
Recruitment Outsourcing Providers in the Philippines
Recruitment outsourcing providers in the Philippines such as Sourcefit have more stringent quality metrics than most in-house HR departments. This can give clients detailed and accurate data such as the volume of candidates that meet hiring criteria, the best sources of qualified candidates and other information that reduce time to fill and reduce cost per hire.
Please contact us to find out about Sourcefit’s custom recruitment solutions.