What is Recruitment Process Outsourcing: RPO explained

What recruitment looks like in one business can look completely different in another. It is one of those human resource functions that lends itself to being quite flexible depending on the requirements of a business. For example, recruitment in one business can involve just the screening and sourcing process of potential employees. However, for another, it can involve the sourcing, hiring, screening, interviewing, onboarding and management of potential candidates. There is no set guide to setting up a successful recruitment or talent acquisition team.

That is why it is important to understand how best you can establish efficient recruitment processes. This could mean having a recruitment team based outside of your business or sending recruitment tasks overseas - an outsourced recruitment function - better known as recruitment process outsourcing (RPO).

In this blog, we take you through what recruitment process outsourcing or RPO is, why it is important, the benefits and how to select the right RPO provider for your business.

What is recruitment process outsourcing?

RPO is a subcategory of BPO or business process outsourcing and sometimes can be referred to as human resource outsourcing (HRO) if a businesses recruitment function lies within the HR department. Recruitment process outsourcing (RPO) involves sending all or some of your recruitment processes or tasks to a team or person outside of your business to complete. This could be anyone from a freelance RPO provider just down the road to an outsourcing provider overseas that offers RPO services.

Why is RPO important?

Let’s start by taking a look at the market. The global RPO market size was $6.107 million at the end of 2019 and is expected to grow to $18.540 million by the end of 2026, with a compound annual growth rate of 17%. This projected growth is supported by the need for efficient recruitment processes to combat the current global labour shortage. Recruiters no longer need to just be good at ‘finding’ quality talent but also need to be able to ‘attract’ and ‘convince’ potential candidates too. Research suggests that job seekers are more in control than ever before.

They hold all the power, making more informed, value-based decisions on who they want their next employer to be rather than just settling for the satisfaction of financial gain or job stability. Alternative resourcing strategies, like recruitment process outsourcing, allows businesses to tap into subject-matter experts around the world who work with talent acquisition for a living. RPO means your business is partnering with recruitment experts to ensure your recruitment strategies, tasks and processes are completed efficiently, effectively and sustainably.

What recruitment tasks or processes are outsourced?

That is completely business dependent. However, commonly outsourced recruitment roles include HR specialists or talent acquisition specialists and commonly outsourced tasks might include:

• Liaising with hiring managers to determine requirement needs and selection criteria
• Sourcing potential candidates through various platforms including online advertisements, LinkedIn, social media and job boards
• Managing the hiring process from start to finish, including screening, interviewing and offering stages
• Organising the interview process and questions for shortlisted applicants
• Writing, placing and updating job ads and job descriptions
• Managing communications with job applicants including the scheduling of interviews
• Administration of onboarding and terminations
• Generating and maintaining HR reporting 
• Maintaining and updating personnel files
• Administration tasks relating to employee relations issues, performance management and OH&S.

What are the benefits of recruitment process outsourcing?

While outsourcing can significantly reduce employment costs, there are many more benefits a business can experience with RPO, from streamlined efficiencies through to accessing capabilities that only external assistance can generate. Let’s go through some of these benefits in detail:

Delivers cost savings

Anyone familiar with recruitment can empathise with how lengthy the process can be. Having to source, create candidate pools, screen resumes, send invites for interviews, schedule interviews with hiring managers, propose contracts, negotiate contracts terms - all takes time and requires financial investment. Not just RPO but outsourcing in general can save your business up to 70% on employment costs alone.

Improves candidate quality

Again, time is a popular commodity in the recruitment function. Think about it, to find the ideal candidate, you need to thoroughly go through the applicant's qualifications and experience as well as identify if they fit the company culture and have the necessary soft and hard skills to be a valuable addition to the team. RPO providers are subject matter experts and have access to a greater talent pool which provides them with the ability and time to find candidates that fit these key areas.

Improves time-to-hire

Lengthy recruitment processes can not only put stress on your recruitment or HR department but also on the line managers and teams of those down a team member. That is why the ‘time-to-hire’ KPI is an important one in recruitment. The faster you can find a suitable candidate, the quicker a function within the business can get back up to speed. RPO providers are constantly on the lookout, searching and creating active candidate pools with top-tier talent ready to hire. They are always in the market, understanding who is available or when they will be available. This significantly decreases the ‘time-to-hire’ issues some businesses can be faced with.

Fosters scalability

Recruitment process outsourcing allows you to quickly and easily grow or reduce your team according to your needs. For example, if you have an unexpected recruitment drive, you can employ additional talent acquisition specialists to assist. Outsourcing will allow you to add and remove team members depending on which skills your business needs at the time.

How to select the right recruitment process outsourcing provider

A recruitment process outsourcing provider that works for one business, may not necessarily work for another. In order for your outsourcing journey to be a success, it’s crucial that your business fully understands how potential RPO providers operate and they understand and can meet your business needs. How can you assess this? It’s as simple as 33 questions. This eBook arms you with 33 questions to ask any potential outsourcing provider to be able to drill down on their operations.

This blog was updated on 1 March 2022.