RPO: You get what you pay for
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To outsource or not to outsource. In today’s business environment,
it’s not only a necessary but a smart piece of the business strategy mix to
address non-core competencies. By engaging outside specialists, a company can
more closely manage expenditures and drive significant savings while focusing
internal resources on more direct areas of the business.
My inTalent colleague, Mary Claire Ryan, recently wrote a white
paper on the topic of RPO (Recruitment Process Outsourcing) which can be found here.
It covers much of the fundamentals of the RPO process and its current state in
the business world. She also touches on the fact that many people are using RPO
and don’t know it, so therefore aren’t managing it to its full potential.
When considering outsourcing any business process, namely recruiting,
due diligence is a given. You don’t want to buy a Cadillac version if that’s
more than you are ever going to need—don’t overspend with a partner who may not
fully aligned with your objectives. At the same time, it is just as costly to under-spend
on critical functions just to save money.
For a business, its employees are arguably its most valuable
resource, so human capital processes are not the place to shortchange. When choosing
an RPO partner, if you go in uninformed and unprepared, you’ll get what you pay
for. (Same is true for hotel rooms, laser eye surgery and kitchen knives.) Many
approach vendor relationships by identifying a few companies in the space, then
having that vendor present the project scope or service approach. They think
they are saving money by having the vendor tell them what they need. Not the
case.
Remember why you are outsourcing in the first place—reduce costs, focus on core HR capabilities,
drive efficiencies, and gain skills resources and expertise, among other things.
Build a plan around those areas to identify exactly where an RPO can benefit your
organization. Then determine which firms are most complementary with yours
based on that criteria. This way you aren’t tempted to “add on” services you
weren’t planning (or budgeting) for.
Recruiting is a very detailed and time consuming discipline. The
process involves screening applicants, conducting interviews, following up with
references, negotiating salaries, and so forth. There is little time to shift
gears to address the internal aspects of HR such as on-boarding, training,
benefits, succession planning, and on and on. Utilizing RPO can save a company
time and money if it is with the right partner.
Like anything, you get out of it what you put into it. By identifying
and communicating the capabilities and requirements of your organization with
not only the vendor, but the managers who inherit
managing the vendor, you will capitalize on all that time and money you save.
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Cindy Lubitz is Managing Director of inTalent Consulting
Group