Dispelling the most common recruitment outsourcing and workforce solution myths
A few months ago, I joined my colleague Darren Topping, Director of Solutions and Insights, on Lorien’s ‘People Make The Difference’ podcast to discuss the benefits of recruitment outsourcing in its many forms, and the most common misunderstandings we’ve heard. I’ve been working this space for 15 years and recognise that from the outside, recruitment outsourcing and managed solutions may seem over-complicated and prone to risk. My aim in this blog is to demystify RPO and Contingent Workforce Solutions and dispel some common associated myths.
All or nothing
Many organisations are under the impression that if you’d like to outsource your recruitment, you have to outsource absolutely everything, but that’s not true. Instead of agreeing an all-encompassing end-to-end service, you could choose just to outsource certain elements, such as the sourcing, the administration, or even a specific grade or vertical of recruitment – for example your tech hiring. At Lorien, we’ve found that future-facing clients are now looking to slice and dice their outsourcing in a variety of ways to suit their business needs. No one solution is the same, and each organisation is unique, but the important thing is to find a partner who can create a bespoke solution for you. This way you only need to outsource what is absolutely necessary.
Risky and complicated
I’ve heard the terms ‘risky’ and ‘complicated’ attached to outsourcing too many times to count. That is definitely not the case. Designing a talent solution that leverages outsourcing is a straightforward, simple process. When you think about what kind of outsourcing model and structure will work for your business, a credible workforce solutions partner can help you to do that without complexity or huge cost. You can agree clear pricing levels with your partner that allows your demand to scale during busy periods or reduce requirements (and thus reduce costs) when it’s a little quieter. Your solutions partner will flex their team according to these demands. There is also a lot less risk when you decide to partner with a specialist outsourcing provider, as there’s often the option to negotiate a reciprocal ‘termination for convenience’ clause in the contracts – this gives you the option to exit without penalty to bring recruitment back inhouse, or transition to an alternative partner, prior to the contract end. Ultimately, companies outsource because they can reduce their time to hire and their overall cost, whilst improving the quality of candidates and their experience. It can be an invaluable partnership.
Outsourcing means you’ve ‘failed’
Occasionally I’ve heard commentary suggesting that if you can’t find your own candidates or manage your own process, you’ve somehow failed at recruitment. Of course, this is nonsensical! For example, you can have a highly effective inhouse recruitment function that delivers superb core hiring consistently, but you might need to consider an outsourced partner to add that extra edge to your delivery for a specific project or to run a brand-boosting campaign on your behalf. You might be struggling to tap into diverse candidate pools when opening up in a new location, or finding that due to a surge in demand your team is working at full capacity and needs additional support. Perhaps you wish to reduce your reliance on agencies and build up an talent community owned you and stored on your internal CRM. Whatever your circumstances, partnering with an expert talent solutions business who can help you achive your business objectives through an outsourced arrangement - in whatever way works best for your business - is just common sense, and the opposite of failure.
Best practices when considering a potential workforce solutions partner
The best advice I can give anybody looking to engage and select their next recruitment outsourcing partner is to have the right information and data to hand. When you first start to engage with potential partners, you’ll be asked for basic data; for example your intended scope of the outsourcing (i.e. where you’d like the service to start and stop), typical volumes, salaries, and locations. You don’t need to provide hugely detailed information, but it’s good to be as open as possible and demonstrate any pain points or problem areas to your potential partners.
If you’re struggling to determine where to start with your search, many Industry Analysts provide rankings and analysis of different recruitment outsourcing and contingent workforce solution providers, offering a great first stop in your search. We also suggest talking a range of different providers – both mid-market and enterprise, and those that specialist in your sector or recruitment skillsets (e.g. tech, change and digital). When you move onto having conversations with providers, simultaneously leverage your social and business networks to speak to any contacts you have that work with outsourced providers.
You’ll want to ensure you’ll be an important client to your partner (see my blog on ‘What it means to be an important client – and how can you tell if you’re not?’) and that your provider specialises in the kind of recruitment that you need. Cultural fit is also important – you can’t put a price on meeting potential partners and getting to know them, spending time talking through what you’re trying to achieve and how they can help you. If possible take some informal references and once complete, you’ll probably be in a good position to select a shortlist and request a formal quote.
Benchmarking your existing outsourcing provider
If your business already has a solution in place, but you’re not sure if it’s the right partner for the long term, you might wish to benchmark your incumbent provider. One common myth is that this is time consuming and difficult to do – not so! Firstly, you need to look back and think if your provider has delivered what they said they would in the sales pitch and the proposal. Data can also play a key role in examining your partnership as you’re able to see if SLAs and KPIs are being achieved. Take a careful look at the statistics and targets, and particularly how have they performed from a direct sourcing (non-agency sourcing) perspective.
When considering changing partners, it’s also important to look forward. Is your partner future proofed? Where is your business going, and can your partner grow with you – perhaps you’re going through a digital transformation and you need specialist recruitment capability to hire those niche and in-demand skillsets – or you’re expand internationally. Many clients look for multi-faceted partners who can offer Total Talent Management in conjunction with SOW Spend management services. See my previous blog on benchmarking here.
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