Written by
Changeboard Team

05 Jun 2013

RPOs vs. talent acquisition: which model works best?

05 Jun 2013 • by Changeboard Team

What's best for the future?

Naturally, all businesses have different drivers behind selecting their approach (cost saving, headcount reduction or centralisation) obviously impacting on that ultimate decision. But, which model actually works best in the recruitment landscape of tomorrow?

Internal resourcing functions have matured quite considerably over the last five years based on improved search and management technologies, learnings from tested in-house recruitment models and the perception shift from ‘order takers’ and ‘advert farmers’, to a function responsible for meeting strategic demands of the business (Employer brand, EVP, talent attraction and recruiting for  future capabilities). While some businesses do have TA working successfully, the model isn’t always appropriate or feasible for all organisations, so we have to consider the flip-side of the coin.

Opting for an RPO model

If you’re thinking about enlisting the services of an RPO, you’ll be no stranger to the benefits, like: efficient time to hire windows, a high degree of structure, a centralised approach and the model’s ability to adjust to your hiring demands. However, the caveat is often around the price tag and potential limitations when accessing specialist talent.

Traditionally, RPOs were seen as more successful in buoyant markets (when the concept was initially developed); however should they now rethink their commercial structure to adapt to a market that is increasingly more fluctuant? Approximately 15 years ago, RPO models had the capacity to be more flexible and responsive to demand periods. However, in many instances nowadays contracts would need to be fully renegotiated in order to respond to hiring needs, perhaps highlighting a distinct lack of flexibility.

One of the first and most important elements of engaging an RPO is being fundamentally clear on why you are using it; be it, risk reduction, from a legality perspective or for a particular set of expertise. Thomas Breach (Talent Acquisition Manager at Thomson Reuters) stresses the need to “be clear who on is driving the process: Resourcing, Procurement or HR. Ultimately, the decision and process needs to be supported by all three functions and most importantly, be fit for purpose.”

When engaging an RPO, make sure they are providing you with a service worthy of what they are being paid for. With regards to talent pipelining, if they’re not planning 3-4 years ahead of time, they should be. When possible request a dedicated RPO resourcing team, working solely on your account to ensure a high quality service, to enable recruiters to immerse themselves in your brand and to make them feel like they are working directly for your organisation.

Building your internal talent acquisition team

TA is undoubtedly more effective when intertwined with strategic workforce planning (SWP), as Resourcing is able to work more closely with the business to meet future hiring needs. Candidate engagement is also often higher during the process; in turn enhancing the development of long-term relationships. However, the internal TA model is generally slower than agency or RPO usage, often lacks in the tools to access passive or ‘hard to reach’ talent, and if managed poorly, can be detrimental to the employer brand.

One of the clear disadvantages of using an RPO is that skill-sets, relationships and talent pipelines aren’t typically being developed internally. Whereas in-house (providing the business and CEO are bought into the TA model), highly skilled teams can be developed to avoid spending out on RPO and agency usage.

Tokunbo Adebayo (Talent Acquisition Manager at Barclays) emphasises that: “if a company believes in the direct sourcing methodology, they have to be prepared to financially support and grow the function. This encompasses developing a solid referrals programme, investing in the right technologies, offering good financial incentives for recruiters and providing attractive training and progression packages.”

Looking ahead, businesses will (and should) become more expectant when it comes to engaging RPOs and will progressively demand a more ‘fit for purpose’ model to meet their hiring needs. Perhaps we’ll start seeing more of a hybrid approach, whereby an RPO meets the peaks of recruitment (more project-based) and the internal TA team covers business as usual hires?