THE TECHNACIOUS RECRUITER NEWSLETTER

November 29, 2005   view past issues

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Feature: To RPO or Not, That is the Question

It’s not as if you don’t have anything else to do. I mean, in addition to waging the War for the Best Talent, your organization also expects you to keep morale up in the face of stingy salary increases, keep attrition down in the face of leadership shortfalls at the supervisory level, and keep benefits administration, health insurance premiums, human resource information systems, training and development, diversity practices, ethical values and a myriad of other people-related issues on an even keel. As a result, a small, but growing number of employers are contemplating a shift in their strategy for talent acquisition. They’re thinking about moving to Recruitment Process Outsourcing (RPO).

It’s a big step, of course, and it’s important to make the right decision. Some believe that it’s fundamentally a business issue. Do the dollars and cents warrant the use of an outside vendor for your organization’s acquisition of talent? Or, to put it more candidly, can you cut internal labor costs in an overhead function like staffing and still keep the seats filled with an external resource? Others, however, claim that the issue is performance. Can an organization use an outside vendor to tap into the best practices of recruitment and, as a consequence, acquire better talent? Should an employer candidly assess its competence in recruiting and, if it’s lacking, turn that activity over to a resource with the necessary expertise?

Both of these factors are clearly important, but they answer only half of the question: what the vendor does. To make a sound evaluation of using RPO in your organization, therefore, you must expand the focus of your analysis to address what you do, as well. In essence, you must assess whether RPO is the best way for you to invest:

  • the organization’s limited capital,
  • the staffing function’s limited management time and effort (because even outsourced recruiting has to be carefully managed internally), and
  • the Human Resource Department’s limited credibility inside the organization.
  • To address those issues, you must first understand what RPO is and what it isn’t. Recruitment Process Outsourcing is the transfer of the operation of your staffing process to an outside vendor. It is the acquisition and oversight of staffing capabilities for your organization. Hence, it can involve all or part of that process. RPO does not, however, transfer the responsibility for recruiting results from the Human Resource Department (even if a procurement function “manages” the contract). HR remains accountable for talent acquisition in the organization regardless of who implements the recruiting process

    Simplistic as it may seem, therefore, the decision to RPO (or not) should turn on your assessment of outsourcing’s ability to deliver expected financial and talent results. And, those results will depend upon your ability to accomplish what I call the “4 S’s.” They are:

  • Sensing your prospects.
  • Setting the right goals.
  • Selecting the right vendor.
  • Seeing that goals are achieved.
  • I’ll cover the first of these four analyses here and the remaining three in my next newsletter.

    Sensing Your Prospects.

    Obviously, you should only use RPO if it can have a positive impact on your recruiting results. Outsourcing, however, can only have a positive impact if your organization has an appropriate profile for that activity. Employers fall into three “recruitment process types,” and only one of those types warrants an investment in RPO. The types are:

    Type A-the organization has some or all of the following characteristics:

  • It is risk averse.
  • It employs hiring mangers who do not feel obliged to follow established procedures.
  • It has limited or no knowledge of the true costs or cost drivers of its recruiting.
  • It has a lousy employment brand.
  • It offers below market compensation and benefits.
  • This organization cannot implement recruitment process outsourcing successfully. It has a culture that cannot compete in the War for the Best Talent. And, procuring a better process-even a world class process from a world class vendor-won’t compensate for that fatal flaw. Said another way, culture trumps process every time in recruiting.

    Type B-the organization has some or all of the following characteristics:

  • It has an efficient process.
  • It has broad compliance with established procedures among its hiring managers.
  • It has effective cost controls in place throughout its recruiting process.
  • It has implemented automation effectively among all users of the process.
  • It has a strong employment brand.
  • It offers market or above compensation and benefits.
  • This organization can outsource successfully, but must adjust its expectations. Why? Because it is likely to see only marginal improvements from the effort. It has already implemented most of the best practices in recruiting and has likely already achieved significant performance and financial gains. Said another way, the best is the best no matter who does the recruiting.

    Type C-the organization has some or all of the following characteristics:

  • It has a reasonably well-engineered process.
  • Its Human Resource Department and hiring mangers recognize the importance of staffing and that it is not an internal competency.
  • It has an objective and carefully measured cost baseline (or is willing to get one).
  • It has a culture where business rules matter and procedures are followed.
  • It has a strong employment brand (or is willing to build one).
  • It has market or above compensation and benefits.
  • This organization can outsource successfully and has the potential to achieve significant improvements. It is a sophisticated consumer because it knows the exact status of its recruiting process in the present and understands what it will take to improve that process in the future. It can, therefore, effectively set performance and financial targets and accurately measure a vendor’s progress against them.

    Recruitment Process Outsourcing can be an effective strategy for winning the War for the Best Talent … but only if the right organization uses the right vendor to achieve the right goals in the right way. We’ve discussed what it takes to be the right organization. I’ll cover the remaining three “rights” in my next newsletter.

    Thanks for reading,

    Peter

    P.S. Please tell your friends and colleagues about WEDDLE’s newsletter. They’ll appreciate your thoughtfulness and benefit from your recommendation.


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    Section Two: Site News You Can Use

    CareerJournal.com and the Society for Human Resource Management released the results of their 2005 U.S. Job Recovery and Retention Survey. It found-gulp!-that 76% of our employees are now looking for a new job. Even worse, fewer than half of all employers are doing anything about it. Only 49% of the HR professionals who responded to the survey said their organizations had implemented special retention programs, and that’s up from the almost ostrich-like figure of 35% last year. What are organizations doing? Respondents said the most effective strategies were:

  • implementing competitive salaries,
  • providing career development opportunities,
  • promoting the most qualified employees, and
  • offering flexible work schedules.
  • Wow! The fact that such fundamentally important initiatives are only being implemented in the face of potentially dramatic employee desertion underscores the bankruptcy of HR management as it is presently practiced. Its culture of yes, sir-no, sir-three bags full, sir all but ensures that corporate executives will misunderstand the requirements of successful talent asset formation in an era of labor scarcity. What they and the organizations they run desperately need, instead, is HR leadership, because it engenders a culture with the courage of its convictions and the moxy to implement them.

    Google introduced a new feature called Google Base. Its purpose is to help consumers find classified advertising for cars, homes and … yes, jobs. In essence, your recruitment ad can now appear for free on Google and in front of all those prospects who use its search engine. There are just one or two tiny little problems with the service. First, your ad will be but one of 17,000,000 others like it appearing on the site. Instead of competing with peer employers, you’ll now be competing with every Tom, Dieter and Hoshan who has an opening to fill anywhere in the world. That means a candidate will have to scroll down to the 12,348,717th ad to find your posting in the search results-a highly unlikely occurrence given the attention span of the browsing public. Second, you can, of course, improve your ad’s visibility by paying to highlight it using Google’s now famous contextual advertising model. As the price of these ads is based on what your competitors are willing to pay for them, however, it’s also unlikely that they’ll end up being any cheaper than your traditional postings on a more targeted job board. While the jury’s definitely still out, therefore, I think it’s at least an even bet that Google recruitment ads will be a great way to overpay for reaching active job seekers and a lousy way to reach the passive prospects we most want to recruit.

    HRMagazine from the Society for Human Resource Management published a recent story on H-1B visas, the entry permit for foreign workers seeking employment in the United States. According to the article, the total allotment of these visas for fiscal year 2006 (which runs October 1st to September 30th) was reached in August, more than one month before the fiscal year even began. If your company was one of the thousands scrambling to get one or more of these allotments, I respectfully offer the following suggestion: Invest the money you’re now spending on lawyers and administration for H-1B visas on upskilling the workforce in the communities where you need talent. Given the lead time required to obtain a visa, this alternative strategy is just as likely to deliver the workers with the skills you need in the time frame you need them, and it will enhance the stature of your organization’s employment brand, improving even further the quality of the new employees that you hire. Where I come from, that’s called a “2-fer,” which is clearly more than you’re getting with an “H-1-fer.”

    JavaJobs.com released a new feature called Web Services. It provides site Webmasters with free business-to-business and business-to-consumer solutions that they can use on-the-job. Why do you care? According to the site, the usefulness of this free content will attract a population of potential candidates who will now see your postings on its site, as a result. As its name makes clear, the site specializes in positions involving the use of Java technology.

    WorkSurveyor.com and Bob Nelson released the results of some recent research into what employees value and what they don’t from their employers. The three most important attributes were (1) a manager who supports them when they make a mistake, (2) being personally thanked for doing good work, and (3) being asked for their opinion or ideas. What they could care less about is receiving a certificate of achievement or being named employee of the month. Interestingly enough, in a separate survey by WorldatWork and the National Association for Employee Recognition, only 41% of employers said they recognized employees for their suggestions or ideas, while almost four-in-ten (39%) selected employees of the month or year. What’s it all boil down to? I think employees want leadership, and employers, all too often, give them dewey buttons, instead. Employees want to be led by those who care about them and about helping them to make a real and meaningful contribution to the organization. Employers want the same thing, but all too often they try to produce that behavior with wall posters and platitudes rather with than leaders who are held accountable for encouraging and enabling it.


    Section Three: Site Profiles

    Site Insite … how well do you know the Web’s 40,000+ job boards?

    1. The Holiday crush has just begun, and the Grinch has already struck-one of your retail store managers just quit. Where could you go online to ring up some strong candidates?

  • RetailManager.net
  • Retail-Manager.com
  • AllRetailJobs.com
  • BestJobsUSA.com
  • 2. Your nursery is seeing its Holiday business explode, and you want to find another arborist fast. Which of the following sites would help you grow a list of prospects who would blossom in the job?

  • TreeCareJobs.com
  • TreeCareIndustry.org
  • ArboristSite.com
  • AgCareers.com
  • 3. Your energy company needs a machinist to work at its plant outside New Orleans. Which of the following sites would produce a smooth finish to your search process?

  • BlueCollarJobs.com
  • Trades.com
  • Machining.Micronomy.com
  • Finishing.com
  • (answers below)

    Site Spotlite … from the pages of WEDDLE’s 2005/6 Guides and Directories

    InterEC.NET

    http://www.interec.net

    Internet Engineering Center

    Post full time jobs: Yes

    Post part time, contract or consulting jobs: Yes – All

    Distribution of jobs: International

    Fee to post a job: None

    Posting period: 6 months

    Can posting be linked to your site: No

    Resume database: Yes

    Number of resumes: 500

    Source of resumes: Direct from individuals

    Top occupations among resumes: Engineering

    Other services for employers: Listserv for networking, Banner advertising, Status reports: banners/postings.

    Answers to Site Insite

    1. All but Retail-Manager.com, the site of a firm selling retail management software and services.

    2. All but TreeCareIndustry.org, the trade association of tree care companies.

    3. All but Trades.com, a site devoted to equity trading.


    Support Our Sponsor: ZoomInfo

    This issue of WEDDLE’s newsletter is brought to you through the generous support of ZoomInfo.

    Better Information Means Better Candidate Placement-Try ZoomInfo

    “The ROI on ZoomInfo is evident from the number of successful placements we have made as a direct result of using the tool.” Tristaff

    Learn how Tristaff, a premier recruiting firm since 1972, uses ZoomInfo to both find and research candidates for successful placements. Benefits to Tristaff and you:

  • Locate superior passive candidates
  • Quickly find candidate background information
  • Develop new business by targeting decision makers
  • ZoomInfo is an intelligent search engine that finds, extracts and summarizes online information on more than 27 million people and 2 million companies.

    Download the case study today