RPO is the complete ‘process’ outsourcing of recruitment. The RPO vendor is accountable for transforming the client’s processes and is responsible for all areas — tactical and strategic.
Anjali Prayag
The Bangalore-based IT consulting firm MindTree Consulting made a clean sweep at the annual Recruitment and Staffing Best in Class (RASBIC) Awards ceremony, winning five of the seven awards at the event held last month. It was recognised as the Best Recruiting and Staffing Organisation of the Year.
The company attributed the achievement to its talent acquisition team that had transformed recruitment from a traditional Excel-based recruiting and staffing function to a cost-effective process with a faster turnaround and better job fits.
Sanjay Shelvankar, Vice-President, MindTree Consulting, puts the company’s recruitment effectiveness down to a well-managed recruitment process outsourcing model (RPO). “RPO is the future and the rest of the world has recognised it — the time is ripe for India to replicate this model,” he says in an interview with The New Manager.
In his opinion, when the current recessionary period passes and the IT industry gets back to binge-hiring, it will be the ability to recruit large numbers, swiftly, consistently and in an inexpensive manner that will help the sector resume its high growth rate.
Please explain how an RPO vendor is different from other recruitment partners (non-RPO vendor model)?
The difference is actually that between the sky and earth. A recruitment partner is usually one of many resume sourcers (contingency hiring organisations) and in some cases may also supply contract recruiters to the client. The recruitment partner usually works in conjunction with the client’s existing recruitment teams and other sourcing vendors. Most often, the planning, processing and almost all the strategic areas of recruitment are retained by the client-side recruiter team. In this model, accountability is not passed on fully to the recruitment partner and the commercial model followed will at best be a fixed retainer fee that may or may not have a variable bonus component.
RPO is the complete ‘process’ outsourcing of recruitment. This means that the RPO vendor holds complete accountability for transforming the client’s processes and is ultimately responsible for all areas — tactical and strategic. The commercial model is a full-risk switchover to outcomes/value-based pricing, a clear departure from the traditional no-risk retainer fee model.
How is the effectiveness of the RPO vendor measured?
When we defined RPO, we realised that it would be relevant to an organisation only if it links its payments to value created and/or outcomes achieved. The challenge was to quantify the value/outcomes in detail so both parties were satisfied that they were getting a fair deal. At MindTree, it was relatively easy to get here as we had begun measuring our recruitment effectiveness internally before we implemented the RPO model. We have identified eight critical-to-quality (CTQ) items that we will monitor in the RPO engagement, namely, the fulfilment index, source mix, no-shows, offer to joining conversion rate, turnaround time, screening to interview selects, cost per hire and effort per hire.
How does RPO help in reducing the cost per hire, effort per hire and the overall candidate-job fit? Can you talk about the MindTree experience?
Since the RPO vendor takes responsibility for the entire recruitment team and its activities, the recruitment team’s direct (salary) costs are first transferred to them. Apart from this, there are at least six different cost items such as sign-on bonus, employee referral payouts, walk-in events, travel and logistics costs, etc, that are transferred to the RPO vendor.
Besides the cost-transfers, the RPO team structure ensures optimal usage of resources and there are incentives to increase productivity and minimise effort-loss. Since the RPO is accountable for the entire process, there is an incentive to continually innovate and realise process improvements rather than being content playing the paper-pushers.
The RPO vendor handles all hiring requisitions and passes them on to a preferred sourcing vendor. This ensures that there is a deep discount on the industry average of 8.33 per cent consultant payout on each joinee, ensuring that the cost per hire is significantly lower than before.
Candidate-job fit which is the ultimate deliverable is the most difficult to achieve as requisitions from our internal customers are not as clear and unambiguous as we want them to be.
Does RPO help in bringing in a JIT (just-in-time) hiring system?
RPO definitely enables JIT hiring. Our average processing time from receiving a resume to rolling out an offer is 5.6 days. This period includes tasks such as screening, arranging the interview logistics, taking the candidate through three levels of interviews and rolling out the offer letter. ....
Source:
http://www.blonnet.com/manager/2009/03/02/stories/2009030250831000.htm
Anjali Prayag
The Bangalore-based IT consulting firm MindTree Consulting made a clean sweep at the annual Recruitment and Staffing Best in Class (RASBIC) Awards ceremony, winning five of the seven awards at the event held last month. It was recognised as the Best Recruiting and Staffing Organisation of the Year.
The company attributed the achievement to its talent acquisition team that had transformed recruitment from a traditional Excel-based recruiting and staffing function to a cost-effective process with a faster turnaround and better job fits.
Sanjay Shelvankar, Vice-President, MindTree Consulting, puts the company’s recruitment effectiveness down to a well-managed recruitment process outsourcing model (RPO). “RPO is the future and the rest of the world has recognised it — the time is ripe for India to replicate this model,” he says in an interview with The New Manager.
In his opinion, when the current recessionary period passes and the IT industry gets back to binge-hiring, it will be the ability to recruit large numbers, swiftly, consistently and in an inexpensive manner that will help the sector resume its high growth rate.
Please explain how an RPO vendor is different from other recruitment partners (non-RPO vendor model)?
The difference is actually that between the sky and earth. A recruitment partner is usually one of many resume sourcers (contingency hiring organisations) and in some cases may also supply contract recruiters to the client. The recruitment partner usually works in conjunction with the client’s existing recruitment teams and other sourcing vendors. Most often, the planning, processing and almost all the strategic areas of recruitment are retained by the client-side recruiter team. In this model, accountability is not passed on fully to the recruitment partner and the commercial model followed will at best be a fixed retainer fee that may or may not have a variable bonus component.
RPO is the complete ‘process’ outsourcing of recruitment. This means that the RPO vendor holds complete accountability for transforming the client’s processes and is ultimately responsible for all areas — tactical and strategic. The commercial model is a full-risk switchover to outcomes/value-based pricing, a clear departure from the traditional no-risk retainer fee model.
How is the effectiveness of the RPO vendor measured?
When we defined RPO, we realised that it would be relevant to an organisation only if it links its payments to value created and/or outcomes achieved. The challenge was to quantify the value/outcomes in detail so both parties were satisfied that they were getting a fair deal. At MindTree, it was relatively easy to get here as we had begun measuring our recruitment effectiveness internally before we implemented the RPO model. We have identified eight critical-to-quality (CTQ) items that we will monitor in the RPO engagement, namely, the fulfilment index, source mix, no-shows, offer to joining conversion rate, turnaround time, screening to interview selects, cost per hire and effort per hire.
How does RPO help in reducing the cost per hire, effort per hire and the overall candidate-job fit? Can you talk about the MindTree experience?
Since the RPO vendor takes responsibility for the entire recruitment team and its activities, the recruitment team’s direct (salary) costs are first transferred to them. Apart from this, there are at least six different cost items such as sign-on bonus, employee referral payouts, walk-in events, travel and logistics costs, etc, that are transferred to the RPO vendor.
Besides the cost-transfers, the RPO team structure ensures optimal usage of resources and there are incentives to increase productivity and minimise effort-loss. Since the RPO is accountable for the entire process, there is an incentive to continually innovate and realise process improvements rather than being content playing the paper-pushers.
The RPO vendor handles all hiring requisitions and passes them on to a preferred sourcing vendor. This ensures that there is a deep discount on the industry average of 8.33 per cent consultant payout on each joinee, ensuring that the cost per hire is significantly lower than before.
Candidate-job fit which is the ultimate deliverable is the most difficult to achieve as requisitions from our internal customers are not as clear and unambiguous as we want them to be.
Does RPO help in bringing in a JIT (just-in-time) hiring system?
RPO definitely enables JIT hiring. Our average processing time from receiving a resume to rolling out an offer is 5.6 days. This period includes tasks such as screening, arranging the interview logistics, taking the candidate through three levels of interviews and rolling out the offer letter. ....
Source:
http://www.blonnet.com/manager/2009/03/02/stories/2009030250831000.htm
