Recruitment Process Outsourcing: A Buyers Guide. To Accompany Tender Document

Transcription

1 Recruitment Process Outsourcing: A Buyers Guide To Accompany Tender Document

2 SUPPORTING DOCUMENT What should you consider when choosing an RPO provider? This will be a mixture of qualitative and quantitative data. How you weight the responses is entirely dependent on your business and the factors that influence it; a lot depends on how close and impactful a relationship you want and need. Whether you need a company to turn the recruitment handle as a process, so to speak, or to partner with your business from a strategic perspective and anticipate your recruitment cycles and needs. The questions below are comprehensive but not exhaustive. You may wish to adapt the phraseology to suit your corporate communications style or to elicit a more or less explicit or factual versus elaborate and descriptive a response. In conjunction with this tender, we have compiled a supporting document which outlines the thinking behind each subject and some of the areas to be aware of when considering responses.

3 RPO PROVIDER DETAILS 1. Area of expertise: Please detail your experience in relevant technical sectors Please detail your experience in relevant functional disciplines Please detail your experience in relevant levels of seniority Be clear in your mind whether this is important to your business. Specialists are often necessary in very niche industries but an RPO provider is different to an agency in that it is the process that is important rather than the individual. Robustness of process, scalability, flexibility and cost are often more important that technical specialism, as account managers are recruited for their functional expertise. It is worth taking time to understand the calibre of people involved in the RPO business. Are they strategic business people? Are they intelligent, honest and straightforward? Do you feel comfortable with them? Can you envisage them as your business partners? 2. How many RPO clients do you currently have? Do you want to be a sizeable and important client to your service provider or is there safety in numbers by being one of many of a similar size? Being a disproportionately large client for an RPO provider of any size has its positives and negatives. You will undoubtedly have their focus and a great deal of effort, however you may be so important to your RPO provider that they do business with you at any cost, including sacrificing profit for volume or kudos. This creates pressure on the business to drive profits elsewhere reducing staff overheads (less able recruiters onsite) or increasing costs to other clients, which one day could be your account. Conversely, being one of many means that you may not be able to design and drive through the strategic change that you need; a smaller RPO is much more likely to design and implement long term, robust change. 3. What is the typical number of appointments you handle in a twelve month period for each client? Do you know how many appointments you are likely to make in a year? The response here should indicate how the RPO provider would help you to determine your likely hiring volume, typically achieved through an audit of past activity and an analysis of your business growth or change strategy for the next months. This question will help you to determine whether your RPO provider is accustomed to business of your scale. If they are used to appointing dramatically fewer or more than you are, anticipating for your business, you should probably probe a little more deeply. Dramatically more might indicate that the RPO provider is unaccustomed to a closer, more strategic relationship; while dramatically fewer might indicate that they do not have experience of volume recruitment. Follow-up questions include (particularly if you are radically different to the RPO provider s norm ): How will you adapt to our environment? 4. What types of business do you typically work with? Size, industry and geographic location. Is the RPO provider working with any competitors? Is that important to you? You will need to be sure that information is not transferable between recruitment account managers, such as by having completely separate back office functions including a separate ATS and dedicated account managers.

4 SET UP AND ACCOUNT MANAGEMENT 5. What is your account management model in house, offsite or a blend? Be aware that there can be additional costs associated with both models around expenses. All of these models can work and there are pluses and minuses to each. 100% in-house recruiters can feel isolated, particularly if they are alone or if there are pockets of resistance to the RPO provider amongst your hiring team. 100% offsite recruiters can find it difficult to get to know your working culture and can often miss the water cooler conversations with your hiring team that help to create a thinking process around future hiring needs. Your RPO provider should look at your environment and discuss the right approach for you. Follow-up questions include: How do you ensure your team is adequately motivated and managed (in house)? How do you avoid your recruiters going native? How do you develop working relationships with your clients effectively (offsite)? 6. What is your process for new accounts? Approaches to setting up new accounts can range from the entirely bespoke to entirely prefabricated, and both have their benefits. All RPO providers should have a basic process in place to avoid reinventing the wheel. Bespoke processes run the risk of overcomplicating recruitment, while prefabricated processes do not take into account your own cultural needs. A bespoke process should involve some detailed planning and analysis, taking time to understand what processes you have in place at the moment and presenting a revised process for you to review and approve. Be aware that this process takes time, so make sure that you discuss timescales with your preferred RPO provider. They should be flexible enough to provide a shortterm solution to cover emergencies. Follow-up questions include: What information do you need to carry out your planning phase? How long does your planning phase take? How involved can I get in determining your process? Is it flexible? 7. How do you determine your account team for new clients? 8. How do you ensure that the right people are appointed to your new clients? This is probably the most important factor in an RPO relationship. As well as excellence in delivery, stability, consistency and reliability are critical to the success of a relationship-driven partnership like recruitment. Your hiring managers need to trust and value your recruitment team; otherwise they will continue to use recruitment agencies. It is easy to forget that recruiters are the first point of contact for your employees of the future. They should reflect your business culture and act as brand ambassadors for you in the competition for the best talent. Is your RPO provider hiring for your business or drawing from bench strength? If the latter, what do these employees do in between accounts? This can be a hidden cost that impacts on the profitability of the RPO provider. In addition, taking the best performers off their current account leaves a hole which needs to be replaced, and one day you could lose your account manager to a new client. Ideally, your RPO provider should have their own Talent Warehouse of recruiters; people they know, value, may even have worked with in the past, with a variety of skills and technical specialisms. If not, they should be able to be transparent with you about how long it will take to appoint your team and what can be arranged as a short-term measure. Other follow-up questions include: Are you able to have a say in who is appointed to your account? How do you know that they will be culturally a good fit for your team? Do they have expertise in your market or are they generalists? Is this important to you? Why? What happens if your appointed account manager does not work out? Has your RPO provider preempted a bad cultural fit before? How did they deal with it?

5 9. How do you promote your services across your clients? One of the biggest battles in implementing a recruitment system is gaining the buy-in of hiring managers, particularly where recruitment has not previously been a strength. Most managers will at some stage need to recruit, so they have an interest in it being as smooth and painless a process as possible. They often have established relationships with agencies, or for whatever reason feel that HR s involvement is not necessary. It is often left to the HR team to roll a new RPO solution out to the hiring managers, who are sometimes unwilling to adopt new practices. You need to determine the support that you need from your RPO provider to win the hearts and minds of the hiring managers; responses here should give you confidence that your RPO provider has experience in a similar environment to your own. 10. What is your typical account structure? This question helps to clarify who you will be dealing with at the various stages of your relationship with your RPO provider. If one person wins your business and another delivers it, it is worth checking how problems will be escalated as the solution you have been sold may not be achievable. Your account structure should include a delivery team and an account director as a means of escalating any problems and understanding the strategic direction of your business. It is also worth meeting some of the company s delivery team so that you can get an idea of the calibre of people that the company hires. This is particularly important if you are an SME and your delivery team is likely to be small as you are reliant on that individual being able to deliver on a strategic as well as a tactical level, or at the very least you need to know that your account director has a thorough understanding of what is happening at a granular level. Follow-up questions include: What is the escalation procedure in case of problems? How do you anticipate problems? How many people are appointed to each client? How do you deal with peaks in recruitment? 11. What is your ratio of recruiters to number of hires? The answer here should be qualitative rather than quantitative as this should vary according to the level of seniority of the role. Typically, more junior positions require a lighter touch compared to managers and directors, who should be engaged with differently. There are also economies of scale from lots of positions of the same type, such as sales people or call centre workers, where multiple people can be appointed from each recruitment cycle. A good average is around fifty hires in a year to each recruiter. It is worth checking the RPO provider s process on dealing with increases in demand. Costs could increase either as a penalty for reduced hiring as the revenues will also reduce, or in order to hire more recruiters to cope with more work. 12. How is your back office team structured? This question is primarily about the work that goes on around recruitment which is critical to the success of any attraction campaign. The major benefit to RPO as a model is that you are not just hiring a recruiter, you are drawing on the expertise of a team of people who have worked on a range of accounts and in many different recruitment environments. The back office should comprise a marketing team to create attractive and engaging candidate materials; technical specialists to help design and implement ATS and other recruitment technology; social media experts to drive your social recruitment campaign; a process expert to continually review process as your company evolves. Check here whether there are additional costs associated with using the back office team. Follow-up questions include: how is your recruitment team supported? Is there a marketing team to pull together candidate attraction materials and newsletters to your Talent Warehouse? Who deals with social media campaigns? How is your careers portal created and managed? Who liaises with your Communications and PR team to ensure a consistent message to the market? How is your account manager incentivised and motivated?

6 13. How often does your account management team change on average? Good recruiters need to be managed, motivated and challenged. Their careers can evolve down a number of routes. This is important to you, the client, because the best recruiters will find other opportunities if their employer cannot stimulate and develop them and if people give notice unexpectedly there will be a period of instability in your recruitment team during the handover period. Your RPO should be able to demonstrate career development for its teams, ideally with junior or even entry level people onsite with each client to learn the ropes.

7 RECRUITMENT PROCESS 14. What is your standard recruitment process? Please attach a separate sheet with your standard methodology/workflow if necessary. 15. What standard documentation do you use? 16. How involved do you get in the interview process? Recruitment is a seemingly straightforward process, but it is also complex, and it takes experience and time to get it right. All RPO providers should have a standard workflow of some description. How flexible you need the RPO provider to be is up to you, your own business needs and how developed your recruitment system is currently. Some companies benefit enormously from the whole process being removed and replaced with a standard large-scale system; others have already invested in an expensive ATS, or have a population of hiring managers who are particularly resistant to change. Ideally the RPO provider will be able to adapt to your needs, but it is worth making sure firstly that it is possible and secondly that doing so will not require extra investment on your part. Similarly, at what stage candidates are submitted to you (post telephone screening, face to face interview or simply following a CV sift) should be flexible according to your needs. Some hiring managers prefer to be involved from the very early stages, at least until they are comfortable that the recruiter understands their candidate base, and others only want to see the best two or three candidates. 17. How do you source direct hires? Ideally the RPO provider will be able to adapt to your needs, but it is worth making sure firstly that it is possible and secondly that doing so will not require extra investment on your part. Here you are analysing whether the RPO provider is covering the applicant market thoroughly. Avenues such as LinkedIn are well-known and should be a given, however there are many different ways to use LinkedIn other than just typing in key words to a search engine. See question 26 for further detail. In addition to social media, there are a great many other routes to market for hard-to-find candidates and this will become increasingly important as the candidate market tightens. Examples include: developing relationships with relevant industry bodies and academic institutions; holding open days; creating mentoring schemes with high potential candidates; keeping in touch with interested potential candidates through newsletters; targeted advertising campaigns in a range of online and printed media. There can be additional costs associated with this, such as advertising and subscribing to CV databases.

8 AGENCY USEAGE 18. When do you use agencies? How do you determine which agencies to use? 19. What proportion of your hires are direct versus indirect (via agency)? 20. How do you get the best out of your agency relationships? These questions will determine how you structure your financial agreement with your RPO. A key benefit of using RPO as a recruitment solution is that the team begins to develop a Talent Warehouse, or pool, of candidates that your business can draw from in the future, which you will not have if there remains a heavy reliance on agencies. Your RPO provider should source the vast majority, if not all, of your roles directly. However, agency relationships can be critical to an effective recruitment delivery team and should be managed carefully. Your RPO provider is also liaising with your preferred agencies and therefore needs to get the best out of that partnership, valuing them as colleagues. The relationships you have built up with your agency suppliers over the years should not go to waste, and idally the RPO provider should spend time with the preferred agencies to make them feel part of the total solution rather than a last-minute distress purchase. Be aware that fees for agency use can vary some RPO providers charge an administration fee. Be aware that fees for agency use can vary some RPO providers charge an administration fee.

9 EXECUTIVE SEARCH 21. Does your firm provide Executive Search services? 22. What is your experience in Executive Search? 23. How is Executive Search executed as part of the RPO? There are a range of services that are classed as Executive Search but may not be, in reality. Executive Search involves proactively engaging with a distinct candidate community against specific roles, typically handled by a specialist headhunter and utilising a researcher to approach relevant candidates. RPO providers who have emerged out of contingent firms may carry out a database search instead. Executive Search is most effective when seeking to appoint into senior positions, managerial or director-level at least. Some RPO providers have distinct departments to handle Executive Search and their credentials should be checked as part of this process. You may wish to keep Executive Search separate to your general recruitment until you are happy with your RPO provider s performance. As a rule of thumb, as the costs of execution are higher for Executive Search, if the proposal does not provide for higher charges for Executive Search you may wish to consider other options.

10 RECRUITMENT TECHNOLOGY 24. Which Applicant Tracking System (ATS) do you use? Are your costs inclusive of the ATS? What elements are not included in the cost? Which systems are compatible with your preferred ATS? Your Applicant Tracking System, or ATS, is the backbone of your recruitment solution. There are many different types of ATS, principally falling into one of two camps: online/cloud-based or server-based. Your business needs will dictate which is most appropriate for you as the costs, levels of commitment and flexibility varies dramatically, and not all are fit for purpose. Your RPO provider should be able to advise you on the most appropriate tool for your business. As an indication, server-based systems are typically very expensive to implement and be the least flexible, so you will probably need to adapt your business processes around it rather than vice versa, while online/ cloud-based systems tend to benefit from being more recent entrants to the market and so are more aligned with new recruitment methodologies, but may lack some of the more sophisticated tools and reporting. You should check whether the suggested ATS will integrate with your existing systems and what the process is to do so as the costs of carrying out integration and can be very high, even with compatible systems. Another hidden cost to watch out for is making any changes to the standard ATS to suit your business if the ATS and its processes are not built around you. 25. What is your preferred methodology for constructing and managing careers portals for your clients? How do your careers portals interface with your ATS? How much support you need in this area depends on the level of expertise you have within your organisation, how fixed your existing systems are and whether you have some form or careers site or portal already. If you already have some form of careers site on your company website your RPO provider should acknowledge this in their response, with an indication of how they can integrate it into their proposed ATS solution and processes. If you do not, equally the RPO provider should acknowledge this and outline their methodology for creating an appropriate solution based on your business needs and profile. Of key importance here is that the solution should be fit for your purpose, whether that is an off-the-shelf solution or something designed specifically for you. As with the ATS, if it is not clear in the response you should check whether there are additional costs associated with the build of a careers portal and what those costs are likely to be. Follow-up questions include: Who will manage and maintain the career website? Is the career website externally hosted on a separate domain or built to exist within the current domain? What CMS (content management system) will control the career website if it is separated? How is the career website performance monitored for application vs dropout (Google analytics etc)? 26. How do you use Social Media in recruitment? There can be no doubt now that social media is a really powerful tool in any recruiter s portfolio. However, using social media effectively is a skill which takes time, experience and patience to master. It is not sufficient just to launch an ad on LinkedIn and see what comes of it; social media is a long term investment which is very closely linked to your employer brand proposition, and the most benefit comes from a well thought-out, consistently applied strategy. A lot of the value of LinkedIn and related platforms comes from involvement in discussion groups, sharing of information and similar. Your RPO provider should be able to demonstrate a thorough understanding of the benefits of effective social media use that goes beyond the basic LinkedIn recruiter profile and how social media can be of most benefit to your business and your strategy. Ideally they should be able to provide additional support from their in-house team with a named person responsible for driving your social media strategy relating to recruitment. This is part of the recruitment process so there should not be an additional charge here, but again as with anything that could be deemed non-core it is worth verifying related costs.

11 EVP AND EMPLOYER BRANDING 27. How do you assess Employer Value Proposition prior to commencing? This is a critical aspect of understanding what you, as a business, stand for and what is, or should be, attractive to your potential hires. It informs everything - who is appointed on to your account, the best sourcing methodology, the correct language and tone of voice to use in advertising and briefing materials, how interviews are conducted, how the onboarding process is carried out. This in turn affects how unsuccessful candidates are handled in terms of their future engagement with your business. In addition you may be able to get some good ideas from your RPO provider on how to improve or adapt your EVP so that it is fit for purpose as your business needs evolve. Be aware that there may be additional costs relating to consulting for this, however a good RPO should see it as part of the process of finding the right people for your business. 28. Do you have a process for improving Employer Branding? What is that process? What support do you provide and what do you need in return from your client? Employer branding is absolutely critical to effective recruitment and retention. Getting employer branding right means that candidate attraction is easier, first and foremost, as more candidates will come to you, but in the long term you should find that improving employer branding has a knock-on effect of reducing attrition. Your RPO provider will know this and it is clearly a double-edged sword, as in theory executing a great employer branding message could reduce the amount of revenue your RPO provider can generate from your business. However, looked at another way reducing attrition gives your business the opportunity to focus on growth, which in turn creates further roles. How your RPO provider responds to this question will give you a really good understanding about their strategic input into their clients, so even if you carry out Employer Branding in house it is a useful way to get to grips with how an RPO client works as a partner.

12 REPORTING AND ANALYTICS 29. What metrics do you typically report on and with what frequency? 30. How do you measure your own success? 31. How do you improve your performance? This primarily concerns how your RPO provider is performing. There are two key positive reasons for measuring metrics firstly, ensuring that your RPO provider has improved your company s recruitment performance and secondly, delivering continuous improvement throughout the course of your relationship. Metrics are also useful should you wish to exit your RPO provider if the break clauses in their contract are overly onerous, in much the same way as a performance review with a member of staff. Your RPO provider should have a standard list of metrics and should be able to show you examples of how they have been able to improve performance with a client in the past. Key metrics should always include Time To Hire, Cost Of Hire, CV To Interview Ratio and Interview To Offer Ratio at the very least. Management time, source of applicants and offer acceptance ratio are a few more. There are at least thirty useful metrics that can be employed depending on your company s current data and objectives. Success can be measured in a number of ways and the answers here will give another solid indication about how the RPO provider works with their clients. Strategic partners will tend to focus on specific examples, or talk about making improvements that the client has not ask for explicitly but that improve performance in a targeted way. RPO providers who are accustomed to bulk recruitment at low cost will tend to talk about the easily trackable metrics such as number of applicants per role rather than selection methodology, attrition rates or promotion rates. Follow-up questions include: What do you do when you have an unhappy client? How do you deal with problems from your hiring managers? How do you improve your performance over time?

13 HR SUPPORT AND ADDITIONAL EXTRAS 32. What HR support can you provide? If your company s in-house HR resources are stretched, having the option to outsource some of the more transactional elements of recruitment might be useful. Examples include offer management, onboarding, reference/background checking, ensuring right to work status. You might also find it useful to have some support during the recruitment process, such as offering interview training to your hiring managers, designing competency-based interview questions, holding assessment centres and so on. Some RPO providers can set up and manage your payroll, sickness and holiday tracking, create an establishment list, harmonise contracts and other more technical aspects of HR.

14 CURRENT CLIENTS 33. Current clients please give details of a reference client How much detail you go into with the reference client is up to you, as is the size of the reference client. A small, growing RPO may not be able to give examples of similar businesses to your own, in which case you need to determine whether this is important or whether you are otherwise happy with their processes. Similarly, a large RPO may not be able to give examples of smaller clients, and again you need to satisfy yourself that your needs will be met if the RPO provider is working with businesses who are likely to generate much more revenue from them that your own business. Questions can include: are you happy with your RPO provider? Are they responsive and flexible to your needs? Are there any hidden costs that you didn t know about before receiving an invoice? Can you see steady improvement in your recruitment services? Is your account manager up to the job? Would you hire them again? Can you see a benefit to using your RPO provider rather than having an in-house recruiter? What does your RPO provider do other than recruit? 34. What is the scope of your client activity? This question is designed to help you understand how involved the RPO provider gets in the strategic direction of their clients and how they add value in addition to carrying out recruitment. For example, does the business provide training courses, consultancy, HR support, market mapping, employer branding, long term candidate engagement, process improvement and so on. There may be specific projects that your RPO provider can help you with, such as developing your careers portal, overseas talent acquisition or engagement with a graduate channel, for which you need a more consultative and strategic approach.

15 SUMMARY We hope that this Buyers Guide is useful and gives you some ideas of what to look out for. Getting this decision right is critical. There are many different RPO solutions, all have their merits, and the right one for you will depend on a huge number of variables both within your business and the industry that you are part of or are searching to pull candidates from. Contracts are typically long term; they can be difficult to get out of and once established the tentacles of recruitment reach far across and deep within a business. It is really important that your RPO provider is effectively embedded into your business. They should be su pported by the HR team so that they can get the information they need, while at the same time remembering that they are providing a service and so maintain a professional relationship in which they are judged on performance. It is a fine line, and one that should be navigated with care from both parties. You will get the best out of your RPO provider if you treat them with the respect of a strategic advisor, not as an agency, and you should expect great performance in return. If you have any further questions about any of the information contained in this guide, please feel free to contact us on , or enquiries@quarsh.com.