What Is Recruitment Process Outsourcing (RPO)? Your Essential Guide to RPO Solutions

Recruiting the right people to work with you is an absolutely crucial part of success for any organization. If you’re responsible for hiring new recruits, you’ll want to make sure that the recruitment process is as effective as possible.

That’s why more and more recruitment managers are starting to turn to recruitment process outsourcing (RPO). Working with a suitable RPO partner gives you access to the best technology and expert recruiters, allowing you to make the most of your recruitment operations and meet hiring demands that are only getting more competitive.

If you want to know more about the benefits of recruitment process outsourcing, the different types of RPO, some of our RPO best practices, and much more, keep on reading our in-depth guide to recruitment process outsourcing solutions.

What is Recruitment Process Outsourcing (RPO)?

RPO, meaning recruitment process outsourcing, is when you transfer all or part of your recruitment operations to an external provider. This external provider will essentially act as an in-house recruiter for your organization, allowing you to draw on their expertise by embedding them within your HR operations.

RPO can include gaining access to the RPO program’s talent acquisition team and its wide-ranging suite of recruitment technology, while also ensuring that the RPO partner becomes embedded into your operations, allowing them to gain a deep understanding of your organization’s culture and priorities.

How is RPO different from recruiting?

Many organizations might be thinking that they don’t need to use RPO because they already have an in-house recruiting team. However, many existing recruiting processes simply rely on HR staff who are not specialists in recruitment. This is the key difference – an RPO partner is an external expert group that works with you to achieve your hiring goals.

RPO is also very different from using an agency recruitment team. To put it simply, recruitment process outsourcing offers a far more in-depth and specialized operation that is perfectly tailored to the needs of your business. Here are the main specialisms that RPO can offer compared to a traditional recruitment team:

What’s the difference between RPO and BPO?

You might be thinking that RPO sounds very similar to BPO (business process outsourcing). That’s because RPO is simply a specialist aspect of BPO, which refers to any business process that is outsourced to any external provider. RPO is just the recruitment aspect of BPO.

Why Consider RPO Solutions?

With HR managers responsible for managing their budgets, making an investment in RPO Technology and teams will understandably have to come alongside a clear understanding of its potential. That’s why recognizing its benefits and disadvantages is so important.

Recruitment process outsourcing benefits

Moving to an RPO system has a range of obvious benefits for organizations of all sizes:

1. High-quality talent. Recruitment process outsourcing providers are ultimately responsible for making sure that your business hires the best candidates for your openings. This means that RPOs are specially trained and talented at identifying high-quality recruits, with access to global databases and up-to-date recruitment practices.

2.  Cost efficiency. When they look at the long-term return on investment from using an RPO, many companies find that using an RPO leads to better cost efficiency. With metrics such as time-to-hire and quality-of-hire, RPO teams boost your productivity by making sure that candidates are found for vacancies as quickly as possible.

3.  Scalability of recruitment. By establishing a core of recruitment specialists within your organization – but with access to a wider team in the RPO company – using an RPO provider easily allows you to scale up your recruitment operations as your organization grows.

4. Compliance with regulations. Making sure that you’re following the right legal regulations can be a challenge in recruitment, especially when your HR team already has to focus on compliance around workplace practices. Using RPO allows the specialized RPO team to handle all regulatory demands related to recruitment.

5. Access to cutting-edge technology. With the right technology – such as recruitment data analysis tools – recruitment can become quicker, smarter, and easier. However, this can be expensive if you’re handling recruitment in-house. RPO providers, on the other hand, regularly invest in the latest recruiting technology.

6. HR re-assignment. By working with an RPO provider, you can free up the HR specialists in your organization to work on other operations. This is because RPO providers will take care of permanent recruitment processes, allowing HR professionals to drive overall strategic change and manage the existing workforce.

Disadvantages of recruitment process outsourcing

Although the advantages of global recruitment process outsourcing are obvious, it would be wrong to say that RPO only brings benefits. It’s important to also recognize some of the downsides of recruiting process outsourcing:

1. Onboarding time. When you first work with an RPO team, you need to build in time for them to be fully up to speed. This can be especially complex if you work in an industry with specific demands and regulations, such as in legal organizations.

2. Ensuring long-term buy-in. If you want to really see the benefits of using an RPO provider, you need to make sure that it’s a long-term relationship. This means that you’ll need to build the right culture and expectations in your own teams while also putting the work in with the RPO team to build that relationship.

3.  Managing autonomy. Using an RPO team simply isn’t going to work if you want to micro-manage every aspect of the recruitment process. These people are experts in the world of recruitment, and you need to be prepared to hand over autonomy and control if you want to see the benefits of RPO.

4. Setting out expectations. There’s inevitably going to be some initial points of friction when an external team integrates into your organization’s workflow. When the RPO team arrives, you’ll need to clearly set out your expectations around communications and company culture. This will require regular check-ins to ensure a smooth process.

Types of RPO 

When you decide to move to recruitment process outsourcing, you need to be aware of the different RPO Models that are available to organizations. Selecting the right types of RPO provider will enable you to easily and effectively integrate RPO into your HR operations.

1. Enterprise RPO

This type of RPO, also known as end-to-end RPO, essentially hands all of your recruitment processes to the RPO team, with them providing end-to-end recruitment operations including strategy, interviewing and onboarding.

Enterprise RPO is a long-term project, as they’ll be embedded in your organization for years. It’s ideal for larger organizations that need experts to support their ongoing recruitment operations and that have space for high levels of integration with an RPO provider.

2. On-demand RPO

Also known as project RPO or selective RPO, this is a shorter-term relationship with an RPO provider. It is built around a specific recruitment project or a sudden increase in hiring needs, often lasting for a few months.

On-demand RPO is all about flexibility and speed, with RPO teams being quickly deployed to meet your organization’s immediate needs, and it sees less integration between your organization and the RPO provider.

3. Hybrid RPO

While enterprise and on-demand RPO are the two biggest types of RPO, some operations require a combination of the two approaches, known as hybrid RPO. This will include a long-term relationship with an RPO provider that can be tailored for specific, short-term needs.

In the hybrid RPO model, for instance, you might have one RPO specialist who works with your organization over the long term, but you could extend the level of integration if you have a sudden increase in certain hiring needs. Access to enterprise RPO therefore allows you to easily deploy an on-demand RPO project.

How Does Recruitment Process Outsourcing Work?

Recruitment process outsourcing works by bringing in recruitment expertise from outside your organization. It can be broken down into four key steps.

1. Initial assessment and evaluation

When you first get in touch with an RPO provider, you’ll need to work together so that they fully understand your company culture and existing hiring practices. In this stage, you’ll also consider costs and other practical details such as the service level agreements (SLAs).

The RPO team will also undertake an evaluation of your recruitment operations in order to design their hiring strategy. They’ll integrate their technologies and set out their plan.

2. Sourcing candidates

RPO providers maintain a large pool of potential candidates so they should be able to quickly source the right candidates for your current vacancies. This stage includes screening their candidates and producing a shortlist to your HR leaders.

3. Offer management

The RPO team will then organise and manage the process of interviewing candidates and negotiating offers. This means that all of the practicalities of identifying and selecting the right talent are handled by the RPO provider.

4. Onboarding

Often the RPO provider will remain deeply involved in the operations that come after recruitment, such as onboarding. They will bring their expertise to ensure that new hires are able to get going in your organization straight away. In this stage, you will also work with the RPO team to evaluate their performance and set targets for the future using RPO Metrics.

4 Recruitment Process Outsourcing Best Practices

If you want to make a success of RPO, you shouldn’t just assume that RPO will suddenly solve all of your recruitment problems. Instead, following these best practices will allow you to be as effective as possible:

1. Choose the right RPO partner

Integrating an external team into your HR operations requires a lot of trust. This means that you should spend time identifying the best RPO partner for your industry and specific business context. Follow our advice for selecting the right RPO provider later in this article.

2. Make the most of technology

Investing in HR and recruitment technology can be expensive to do in-house, so you should make the most of the technology offered by your RPO partner. This will allow you to access a huge range of candidate data, produce analytics reports, and automate many key recruitment workflows to boost your productivity.

3. Integrate flexibility

Adaptability should be a crucial consideration when setting up and managing your RPO operations. Plan for scalability, such as by arranging agreements to increase the size of your RPO team, while also ensuring that the team is able to increase their rate of hiring. You should also make sure that the RPO team can respond to any market changes in your sector.

4. Monitor and evaluate RPO effectiveness

As is the case with any business operation, you should always make sure that you know how effective the recruitment outsourcing process is for your organization. This requires tracking and monitoring key recruitment metrics, such as time-to-hire, turnover rate, and cost-per-hire. This will allow you to evaluate the effectiveness of your RPO provider and support any adaptations that you need to make.

How Much Does Recruitment Process Outsourcing Cost?

The cost of RPO will depend on a number of factors: the size of your organization, the RPO provider that you choose to work with, and the type of RPO that you want to use. However, there are some different RPO pricing models that you should be aware of.

Some RPO providers charge a fixed fee, called a management fee, which is commonly used by enterprise RPO services. Others charge a fee per hire, which is more commonly used in on-demand RPO.

However, it’s important to note that there are lots of minimal adaptations that companies make to these payment models – for instance some might charge extra for access to a certain RPO Software. Take the time to check the overall cost of the RPO service when choosing a model and provider.

How to Select the Right RPO Provider

Choosing the right RPO provider for your business context is crucial if you want to successfully implement an RPO model in your recruitment operations. Here are the main things to look out for when selecting an RPO provider:

1. Tech tools

Digital operations are becoming increasingly important in the world of recruitment. You should evaluate the tools that each RPO provider can add to your organization’s tech stack, with new solutions and analytics software offered by many RPO teams.

2. Recruiting services

You should check that the RPO company’s recruiting services are up to date with today’s hiring context. Make sure that their services include recruitment marketing operations, as well as features such as ensuring diversity recruitment.

3. Cultural alignment

Working with an RPO provider will be a long-term process, with significant amounts of integration. This means that you should make sure that there is a cultural alignment between your organization and the RPO team, with shared strategic goals and business values.

4. Scope of hiring

You should also ensure that the RPO provider is able to support your recruitment needs. This means assessing their scope of work – if you recruit globally, do they have the expertise to contribute to this? You could start by seeing which RPO providers are already working in your industry to help with this.

Streamline Your Recruitment Efforts With Oleeo’s Recruitment Process Outsourcing Software

Recruitment process outsourcing is a great way to improve the efficiency of your recruitment operations. By bringing in real experts in hiring and recruitment, RPO allows you to truly identify the right candidates for your vacancies and access the technology that you need to succeed in modern-day recruitment.

That’s why RPO solutions such as Oleeo’s RPO Tool are so popular. Allowing you to streamline your recruitment operations and make hiring more efficient than ever before, RPO software is great at managing recruitment strategies. Request A Demo today to see how it works for your organization.

FAQs About Recruitment Process Outsourcing

What is the meaning of RPO in recruitment?

In recruitment, RPO stands for recruitment process outsourcing, which refers to the practice of outsourcing all or part of an organization’s recruitment processes to an external provider.

What do RPO companies do?

RPO companies manage an organization’s recruitment operations for them, including sourcing and hiring candidates.

Is RPO only available for large or enterprise organizations?

RPO is available for organizations of any size although the type of RPO that you use will change according to your size and demands.

When should you outsource recruitment?

Outsourcing recruitment can take place at any time during your business’s lifecycle but many companies decide to use RPO before an expected increase in hirings.

How to know if RPO is right for your business

Evaluate your existing recruitment processes and reach out to RPO companies to see whether RPO is right for your business.

What is recruitment process outsourcing pricing?

RPO pricing depends on the size of your operations and includes different pricing models, such as a management fee or fee per hire.

What are recruitment process outsourcing examples?

Examples of recruitment process outsourcing include:

1. End-to-end recruitment: An RPO provider manages the entire recruitment process, from job requisition to candidate onboarding.

2. Recruitment for specific roles: Outsourcing the recruitment of particular job functions or specialized roles, such as IT or executive positions.

3. Talent acquisition strategy: Partnering with an RPO to develop and implement talent acquisition strategies and employer branding.

4. Candidate sourcing: Handling the sourcing and initial screening of candidates, including managing job postings and leveraging talent pools.

5. Recruitment administration: Managing administrative tasks related to recruitment, such as scheduling interviews and coordinating communications.

6. Onboarding support: Assisting with the onboarding process to ensure a smooth transition for new hires.