Posted tagged ‘outsourcing research. hr outsourcing research’

Show Your RPO Mojo

May 20, 2009

On drill-down discussions and research, we’ve verified that RPO providers’ pipelines are quite strong right now, in some cases never stronger, but deals are taking longer than ever to close. Why this prolonged decision-making process, when RPO offers such an impressive value proposition – average 43 percent reduced time-to-hire and average 24 percent reduced recruitment costs?

Our just released “Targeting Recruitment Process Outsourcing” research study found that two of the major factors inhibiting buyers from putting pen to paper are: 1) change management issues, e.g., lack of buy-in and commitment from senior management, internal politics, etc.; and 2) lack of baseline data to make the business case for RPO. And of course, let’s not downplay business uncertainty, and consequently workforce uncertainty, and their contribution to RPO contract signing delays.

 Given RPO’s value prop, we recommend:

Buyers put aside fears while gathering the baseline data to evaluate the RPO business case for their unique organization (and providers will help with the baselining), understand that new flexible pricing structures allow for “pay per hire” contract terms to reduce financial output risk, and realize that, once the economy turns around and hiring volumes increase, internal recruiting departments will not be able to ramp up and hire the right people quickly enough…they’ll likely need assistance.

Providers actively adopt a variable cost model, offer prospects support in obtaining baseline data (at minimum on current recruitment costs and time-to-hire), and provide solid evidence of results achieved for other clients. Our research found that the number one selection criteria for an RPO provider is experience, reputation and client references. If you reduced a telecommunications company’s time-to-hire from 90 to 27 days, shout it out. If you beat time-to-hire targets for engineers at a global manufacturer by 30 days, tout it. If you reduced talent sourcing costs by 60 percent for a U.K. financial services company or by 50 percent in just six months for a consumer food product company, highlight it as a case study for prospects. In other words, show your RPO mojo!

Gary Bragar, Lead HRO Analyst, NelsonHall