Everything you need to know about Recruitment Process Outsourcing (RPO)
Has your business ever considered contracting an RPO? Recruitment Process Outsourcing can be a fantastic solution for high-growth medium-sized businesses but not a lot of organisations know what it is.
It’s a service that we offer our clients as a way of providing them with a “recruiter-on-demand” who really knows a client’s business. Find out whether an RPO is something your business should consider.
What is it?
Whether you call it Recruitment Process Outsourcing (RPO) or Recruitment as a Service (RaaS) the concept is the same. This is a model that allows businesses to outsource all, or part of, their recruitment process to another business.
An RPO becomes an extension of your internal team. They know your business and your hiring needs and can deliver exceptional candidates.
Rather than paying for recruitment services when a candidate is placed, in an RPO arrangement, a business pays a recruitment company a day rate, for a contracted number of days each month. When candidates are successfully placed, a small recruitment bonus is paid, rather than a percentage of your new employee's wage.
What are the advantages of an RPO?
With an RPO, you will always have the same people on hand to help your business. Often, you’ll have one key account manager who is your main point of contact.
As an RPO is contracted for a set amount of time on a monthly basis, the recruitment company will spend time getting to know your business so they can source candidates that aren’t just right for the job, but also the right fit culturally.
One of our clients, Elsby & Co, was finding that before RPO, they’d get busy and need to recruit in a conventional way. Their historical results over many years had been that agency recruits had a very low success rate. This was because the agency didn’t know the business and were under time and financial pressures. Therefore the candidates were an ill fit and left quickly. This led to further recruitment expenses for the business.
RPO works out more cost-effective for businesses that are making regular hires, as a recruiter could be working on any number of your internal hires at once.
An RPO should feel like an extension of your business and they’re about far more than just getting bums on seats.
Working with an RPO means that you can work together to address recruitment strategy, plan hires over long-term periods, gain insight and advice on best practices, and have access to a consultant on a regular basis. It’s a proactive approach to recruitment rather than a reactive one.
Who’s it for?
RPOs are most cost-effective for businesses that are growing and hiring on a regular basis. We’d suggest businesses of around 50-250 employees, that plan to hire at least 10 people over the next 6-12 months, would find this model most advantageous.
For smaller businesses that are hiring less, contingency recruitment is probably a better model. This means you use a recruiter as and when you need to and pay a percentage-based fee. You may go to different recruiters for each new hire, but at Exceda Ltd, we endeavour to keep long-term relationships with our contingency clients, regardless of how regularly they hire.
For larger multinational companies who are hiring 10s or 100s of people a month, having an internal team is necessary so that all of the paperwork, the interviewing, and the offers, are handled on a timely basis. Some multinational businesses have multiple teams in recruitment, each with its own specialist area or geography.
An RPO really is the sweet spot for businesses that sit somewhere in the middle. They may have a small internal resource that is stretched to the limit and needs an extra pair of hands, or may not quite be at a point where they need a full-time hire.
RPO is for businesses that want to plan ahead and they’re ready to work with a partner to build their network of candidates, engage in positive social media campaigns to improve employer branding, and come up with innovative ideas to appeal to candidates. It’s about working together to put your best business foot forward to attract candidates.
It’s worth noting as well, that good internal recruiters are hard to find. There’s a significant skills shortage in this area, especially for part-time roles. For businesses that need regular, ongoing, and reliable support, an RPO could be the answer.
“Our business has grown substantially since we began working with Exceda Ltd in January 2021. We were looking to establish a partnership, rather than just a client and recruiter relationship so Recruitment Process Outsourcing just made sense.
Working with Exceda has actually revolutionised our business. The dynamic has changed from being reactive to proactive, and Exceda have influenced every aspect of our employment offering, not just the recruitment part.
They’ve helped improve our retention rate, astronomically improved the success rate of our recruitment, and all that has given the business wings to fly.
We’re now thinking two years ahead with our recruitment, and all this helps keep us ahead of our competitors in very difficult times.”
Why choose Exceda Ltd?
Our business offers both RPO and contingency recruitment to businesses across the Midlands and wider UK.
So far, we have successfully worked with a small number of RPO clients between 3 and 6 days per month and currently have the capacity to engage with high-growth medium-sized businesses on an RPO basis.
For one client, in just 6 months, we successfully placed 16 candidates, working just 4 days per month.
For us, RPO is a fantastic opportunity to really get to know the heart of the business. We take a consultative approach where we work with senior leaders to address their current staffing requirements and project how this might develop in the future.
We pride ourselves on developing long-lasting business relationships and endeavour to find candidates that aren’t just a fit on paper, but a fit in real life.
We recognise that culture is everything.
Contact Nikki today via nikki@exceda.co.uk
