Dating as far back as the 1970’s, organizations all over the world started using recruitment process outsourcing (RPO) as a more effective means of locating, selecting and acquiring global talent. In its early days, RPO was regarded as a full life-cycle solution (end-to-end process) by the providers of such services.
Growth of RPOs
Changes in the external environment, triggered by the global economic and financial crisis of 2008, have forced RPO providers to adjust their services to better meet recruitment needs of globally proactive organizations. IBM explains recruitment process outsourcing processes quite nicely, in fact, in many of their white papers.
RPO providers, more often than before, use new technologies to offer fresh and unique solutions to organisations to keep projects concurrent with society’s demand for product betterment. Because recruitment is a data-heavy process, special applications were designed to help providers put everything together and conduct thorough analyses.
Globalisation
As a new era of globalisation unfolded, more ambitious and financially solid organisations entered new international markets to maximise their profits. They needed local talent, but lacked a wide area of expertise to locate better cadres in a new country. RPO providers that were first to spot emerging trends went global early on to help organisations in their talent acquisition endeavours which, in turn, helped them become a more formidable global presence. Utilising proper benchmarks for powerful marketing campaigns, RPO providers are now able to take globalisation to the next level.
While it’s great to see more people testing and more people aware of the importance of RPO in globalisation, I’ve also noticed that all the hype around globalisation has caused some “myths” to become popular among RPO providers.
Provider consolidation
Smaller RPO providers were forced to exit the recruitment space because of the lack of formality within the recruitment process involved with outsourcing opportunities during the aforementioned crisis. Others had to merge and face challenges during this time span as well. As a result, the number of providers decreased and the industry fell to more robust RPO providers with well-developed infrastructures and a more expansive financial backbone.
Let’s face it: The importance of RPO consolidation can’t be overlooked by business owners who are keen on gaining a competitive edge today. This can be attributed to the fact that popular social media websites like Facebook, Twitter, Google+ and LinkedIn are offering an intuitive means for recruitment processing to take place. Social media sites are in fact the most important sources of RPO immediately after face to face interaction with manufacturers.
Most importantly, RPO providers are showing a stronger willingness to supply points-of-service or on-demand offerings on a project-need basis because that’s what organisations, such as the new Amazon of the Middle East, Jumia, want and can pay for. The buyers define the scope and desired outcomes, leaving the choice of the ways of reaching the goals and control over execution to the providers.
Price Adjustments
Before this evolution, RPO’s were regarded by some as too expensive yet not very sensitive to the precise needs of organisations. After the evolution, RPO providers began offering needs-based and on-demand services instead of full packages prices for the services declined making recruitment outsourcing as such more affordable. RPO providers had switched to the pay-per-performance model.
Mattia Perroni, CEO of Middle Eastern shopping powerhouse Jumia, understands the chain reaction RPO can have on a socioeconomic level. In fact, during the Egyptian political revolution, the penetration of Internet shopping and the time spent online per user was increasing tenfold, making Egypt the third fastest growing social shopping area worldwide. This gives credit to a more refined RPO process which allowed Perroni to help springboard Rocket Internet in The Philippines and eventually move on to growing Jumia Egypt.
Recruitment process outsourcing underwent many transformations to accommodate the ever changing needs of worldwide buyers. Contrary to a formerly popular school of thought, RPO providers are no longer considered to be change agents, nor are they regarded as the driving force behind the present demand for RPO’s.
It is the buyers who have a say in terms of what, when, and how often needs are addressed. In difficult times, there will be less demand for RPO’s, and it will be on a project-need basis. In better times, organizations will have more to spend and will use RPO providers in their global search for talent more intensively. In short, just like any other business during turbulent times, RPO industries will have to keep changing to survive and profit.
© Dave Smitherson
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