Updated: Jan 15, 2021
So your headcount is continuing to grow with no end in sight, you feel like you’re on a ship with a leak and the water is rising. You look at your fellow HR and recruitment partners and see there’s not enough hands or buckets to deal with the rising water. Do you look your team in the eyes knowing that it’s going down? Or do you call on help to deal with the impending doom?
Assuming you’re not fool-hardy, you call on help, specifically a Recruitment Process Outsource, or RPO. RPOs are one of the most cost- effective and cash-flow conscientious things you can do. Think of them as a pre-built water pump to get some of that water out of your ship’s hull quickly and effectively. It’s going to take a minute to integrate but once it has, it should provide long term lasting solutions.
RPOs can be built a number of ways for any number of reasons. Let’s “dive” into them a bit deeper.
Why use an RPO?
Save money or maximize your recruitment budget
Some pricing models are listed below. Never forget, be creative when negotiating with partners – most of the time they are flexible! Factor in how much work they are doing: are they just sourcing, or are they writing job descriptions, interviewing, working with hiring managers, coordinating everything & still sourcing?
Monthly retainer that can be linked to the number of roles
Flat fee per role depending on the role/salary - try a tiered pricing bracket that incrementally increases the fee based off candidate salary or title
Hourly payment to an independent contractor on-site
Leverage database, horsepower & reach
RPOs & Recruitment agencies main IP (intellectual property) is their database of candidates and the relationships of those candidates to those recruiters
When selecting an RPO you also have to think about how many other recruiters they have sourcing for other clients in the space. The more recruiters in the space means more passive sourcing for roles that might be aligned with your company. Also they may be able to quickly call on other internal resources if there is an influx of work increasing your recruitment bandwidth
Agencies are oftentimes signed up to all the major job boards and have LinkedIn Recruiter licenses which, because of their scale, can save a smaller company loads of money
Maximize time and minimize hassle
You have a professional onsite who can meet with hiring managers
The RPOs are able to really ingrain themselves with the culture, understand the product, company vision, and other factors often not well understood from other external partners
Don’t have to review and negotiate 10 different agency contracts that tie up legal
When it makes sense to use an RPO?
At the cusp of explosive growth
A company can only grow as fast as it can hire its people. If your recruitment team is going to be a choke point for the company’s growth, consider how an RPO’s resources can help deal with a large influx of hiring.
Struggling to find candidates in your industry
If this is a consistent problem then RPO could make sense but if it’s just a one off role, you should consider a contingent search.
Your Cost Per Hire (CPH) is just too high at the moment
RPOs offer a great way to stabilize your CPH and help you predict what it’s going to be 6-12 months down the road
Quick improvement of the recruitment process without having to internally revamp every aspect.
HR is bogged down with recruitment, your internal team is a bit inexperienced, your internal processes aren’t great yet - are all reasons to consider it. RPOs are literally a pre-constructed road map to having a smooth recruitment process
Questions to ask potential RPO partners
How are you going to integrate yourself into our culture/company?
Are you going to be a partner to them or a customer to them
How extensive are your services?
Does your RPO just send CVs to you or do you take over the whole process? From conducting interviews to writing JDs
What types of candidates do you specialize in working with?
Think of the passive sourcing they might be doing or their existing database. You’re paying for their IP so make sure it has value
What’s your tech stack?
Do you have access to all the job boards, LinkedIn Recruiter, what ATS (Applicant Tracking System)
How many recruiters will be assigned to us at any given moment?
Maybe you want one dedicated recruiter or the capability to call on 3 of their recruiters. Find out how you can best utilize the resources at hand
Once you start shopping for an RPO, you’ll start to find they each have their own unique ways of modeling their partnerships. But hopefully this article becomes a good starting point if it’s your first time utilizing an RPO.
If you’re interested in learning more feel free to reach out to Josh Lopez, President & Founder at Top Ten Talent (Josh@top10talent.com/303-550-7588) and he can refer you to some of the better known RPO solutions out there.