Workshop RPO: Why You Should Care and What You Should Do

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1 Tuesday 4:45 pm Veranda C Workshop RPO: Why You Should Care and What You Should Do Stephen M. Clancy, Director, Contingent Workforce Strategies and Research, Staffing Industry Analysts Over the past decade, Recruitment Process Outsourcing (RPO) has typically been the lesser-known sibling of MSP. This has changed recently, with more than 20% of all contingent workforce managers surveyed saying they have an RPO in place and another 20% looking at implementing one in the next several years. Coming out of the recession many companies are looking to increase hiring without increasing recruiting overhead. During this interactive session industry experts will outline the basics of RPO, and discuss the keys to success for the many companies that are taking advantage of this form of human resources outsourcing and winning the war for talent.

2 Let s start by I. Who is here.? RPO Clients, RPO Providers, RPO Explorers and RPO Deniers II. Why are you here.? III. What problems are you trying to solve..? IV. Are you committed to SIA RPO Work-shop participation requirements?

3 RPO Workshop Agenda I. What does RPO mean.? II. Why should you care.? III. What should you do about it. IV. Open Q & A Forum.

4 What does RPO mean..?

5 BPO/HRO Landscape Lexicon Cloud Six BPO RPO VOP Sigma LPO Supply HRMS TMO MSP Chain BPO SaaS Utility Cloud Computing VMS HRIS MPHRO ATS Co-Sourcing Professional STO Services MPBPO Multi- Sourcing Art vs. Science Shared Services ERP HR BPO

6 Hierarchal HR BPO Order Stack BPO HRO, FAO, AMO RPO MSP LPO VOP TMO BPO TTO Facilitating Infrastructure BPO Market Segments Multi-Sourcing, MPHRO, Co-Sourcing HRO Market Segments Solution Bundles HRMS Shared Services HRIS ATS Cloud Computing Social Networking VMS ERP SaaS

7 What is RPO? RPO is a form of Business Process Outsourcing (BPO) It represents outsourcing all or part of the recruitment processes by the employer BPO HRO RPO Ownership of Talent Acquisition Process Performance/Management is the biggest distinction between RPO and other types of recruitment services/solutions Paying for a Result.

8 RPO Solutions Models/Variations Remains a highly customized services outsourcing solution End-to-End/Comprehensive RPO Selective RPO Project RPO Administrative RPO Out-Tasking Recruiter-On Demand (ROD) University RPO Workstream Internal Mobility Workstream Intern Program Management Co-Sourcing Multi-Sourcing Typically a combination is deployed across talent segments.

9 What Recruitment Processes can be outsourced? Recruitment marketing/ Advertising strategy Name generation and sourcing Job posting distribution Reference Due Diligence Background checking Drug screening Candidate screening Testing and Selection Interview Scheduling On boarding HM & Candidate Satisfaction ATS Design, Implementation & Mgmt.

10 RPO, More than a Direct Hire Service Typically, 100% dedication of scope and recruiting resource Typically, sourced candidate pool owned by client Service Level Accountability and Comprehensive Process Visibility All activity tracked and processed by recruitment technology (ATS)

11 RPO, More than a Direct Hire Service Includes process consultation (Enhancement/Transformation) and re-design Provider represents the client and employment brand Scope includes process management/ownership Significant cost savings potential.

12 RPO Pricing Models Transaction Fee/Pay Per Use Success Fee/Pay Per Use Management Fee Combination Contract Minimums Pay for Performance Levels Contingency Fee Financing Fees Transition/Implementation Fee

13 RPO Savings Leverage Process Optimization Comprehensive vs Selective Eliminating Perm Agency Spend Variable Expense Partner s Economy of scale Shared Services 10% to 25% savings opportunity

14 RPO Market Providers. STAFFING COMPANIES PURE-PLAY RPO EXECUTIVE SEARCH HRO

15 RPO s Ultimate Definition. What problem are you trying to solve? The types of deals are related to the scope of change, the relationship complexity, and the business value expected from a service delivery relationship. Transformation Business Value Enhancement Efficiency TRANSACTIONAL FOCUS PROCESS FOCUS MORE ART THAN SCIENCE FOCUS Relationship Complexity Selective Process Full Process 2011 by Crain Communications Inc. All rights reserved. Source: Multisourcing, Moving Beyond Outsourcing to Achieve Growth and Agility, Cohen & Young, Gartner, Inc 2006

16 Why should you care.?

17 First, some recent research suggest YOU DO NOT care! The primary benefit of outsourcing is to reduce operational costs Companies that outsource are more nimble and better equipped to weather economic downturns Outsourcing is one of the initial phases of business transformation Loss of Control is an outsourcing initiative killer..

18 2010 Contingent Buyers Survey 18 Twenty-two percent of buyers use RPO, use gradually trending up Currently, 22% of contingent staffing buyers are using RPO, and an additional 20% said they might do so over the next two years. The 22% current usage is the highest so far reported by respondents to this annual survey. The proportion of buyers using RPO has increased an average of 1.4 percentage points annually over the period Are You Using RPO? Don't know, 12% Yes, 22% An analysis of survey responses with respect to this question suggests that RPO will continue to become more popular; our estimate is that as much as 23% of buyers of contingent labor will be using significant amounts of RPO by No, 45% Maybe Over Next 2 Years, 20% Percent of Buyers Using RPO 21% 22% 23% 14% 17% Confidential Report NOT for Distribution 2011 by Crain Communications Inc. All rights reserved (P)

19 Economic Uncertainty driving RPO Growth and natural high Program Renewal Rates MSP RPO fastest growing HRO Workstream RPO Growth slowing with slow down in general hiring trends Deal growth still healthy More Select/Project RPO versus End-to-End RPO engagements More monthly management fees included in deals

20 Global RPO The Global mobility of workers and work continues Today s business growth is being capture in emerging markets across the globe with local talent...beyond traditional labor arbitradge Off shore talent acqusition resourcing Infosys, Wipro RPO Globilization Partnerships and Acqusitions Universal Governing ATS w/ Multisourcing Providers

21 Key Reasons Customer s Engage RPO Reduce Costs Increase speed and capability Improve Hiring Manager/Candidate Satisfaction (Quality) HR focusing on Strategic Talent Management Tasks Access Talent Acquisition Best Practice processes/skills

22 Key Reasons Customer s Engage RPO Replace/upgrade Talent Acquisition technology Make Talent Acquisition costs a predictable operating expense.transition from fixed to variable. facilitate Scalability Increase competitiveness, prepare/begin to engage in the War for Talent Enhance Compliance.both Operational & Legislative Globalization

23 Summary of Core benefits Reductions in Cost..Transition from Fixed to Variable Expense Increased Scalability/Agility/Responsiveness/Speed Access to New Talent Acquisition Process Expertise Access to New Talent Acquisition Process Technologies Enhanced Talent Acquisition Process Performance, Measurement & Management Increased Visibility & Control Enhanced Compliance & Risk Mitigation Access to Continuous Improvement..Ultimately Enhanced TA Competitive Capability

24 Strategic Direction and Leverage Converging Workforce Acquisition Markets/Solutions? Contingent Hire MSP Permanent Hire RPO

25 Multiple Talent Acquisition Work Streams NEXT NEXT Marketplace Marketplace Innovation? Innovation? Direct Hire Total Total Talent Talent Acquisition Acquisition CW Vendor Management IC Management & Compliance SOW/Outsourcing Engagement Management Talent Acquisition Hiring Manager Advisory Talent Acquisition Comprehensive Dashboard Outsourcing Outsourcing Intern/Alumni Engagement Management

26 What you should do about it.

27 Workshop questions.. I. Where do I start.? II. How do I build a business case..? III. Should I Go Big RPO or go conservative/selective/project rpo..? IV. What will be the major challenges..? V. What initial successes can I rely on?

28 RPO Best Practices

29 Best practices Build a Talent Acquisition Supply Chain Strategy/Roadmap w/ multiple work-streams that consider Efficiency, Enhancement and Transformative Strategies.Three to Five Year Timeframe Align Engagements to both Strategic and Tactical Business Objectives.Cost Reduction-PLUS.Although 10% to 20% cost reduction is a minimum in any new RPO engagement

30 Talent Acquisition Capability Roadmap Phase 1 Phase 2 Phase 3 Phase 4 SCALE / DELIVER IMPROVE / OPERATE TRANSFORM OPTIMIZE/CONTROL I. XX II. XXX III. XXXX IV. XXXXX I. XX II. XXX III. XXXX IV. XXXXX I. XX II. XXX III. XXXX IV. XXXXX I. XX II. XXX III. XXXX IV. XXXXX Today Six Months One Year Two Years

31 Best practices Build detailed State of the State review & business case of your Talent Acquisition Supply Chain Acquire Very Senior Executive Sponsor to drive internal political change and support of the HRO/BPO strategy Plan to Continuously Improve your engagement solution starting at Go Live! Leverage an ongoing ROI from the expertise of your RPO partner(s).don t be a passive client!

32 Best practices Design the RPO solution beyond your organization's dependencies where possible so that business and solutions objectives are not compromised and Talent Acquisition Capability/Competitiveness is not limited Don t let your ATS drive your process solution design Go Six Sigma! An RPO Solution can incorporate multiple work streams, technologies and providers

33 Best practices Considerations when Integrating ATS Technology into an RPO Strategy The Mission for its RPO Engagement Strategy ATS: Buy vs Leverage Define RPO Metrics Protocol Integration: Legacy IT Infrastructure & RPO Supply Chain Technologies Universal Report & Analytics Platform Globalization Cloud Recruiting: Web 2.0 Sourcing Networking Strategies Beware of Web Elitism Change Management: The Vital Consideration

34 Best practices Demand cultural delivery team fit Remember to invest in on-going, change management or be prepared to pay the downside consequences SLAs should support what is important to your organization and therefore the RPO engagement should focus on those priorities. They don t drive performance they focus performance a common misunderstanding!

35 Best practices Build an Integrated Partnership with BPO Provider(s) at multiple levels in the your organization (where appropriate, proportionate and supportive) Promote your BPO Partners business growth, so BPO solutions you engaged will competitively evolve

36

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