Myths, myths, and more myths (continued) #8

Myth #8: RPO Costs Too Much

As we continue down the list of what I’m calling “myths“, or rather misperceptions, surrounding the use of recruitment process outsourcing to augment or replace an organization’s recruitment/staffing function or processes, somewhere on the ranking order we’d have to come to cost. The notion that RPO, by providing so many of the additional resources, and additional infrastructure not currently present in your existing process, would almost by definition be more costly certainly is not unreasonable. In fact, the question is all but universal.

But think about it for a moment…and allow me to really torture a metaphor, if you will. If I’m riding a horse and buggy to work, and this old mode of transportation isn’t cutting it for me anymore and I decide I need to do something more contemporary, I’ve got three choices. I can design and build from scratch my own automobile, assuming I have the money and resources to do so (to say nothing of the expertise required). Or I can cobble together some of the best aspects of this automobile to my horse and buggy, which may cost less, but which will still not give me a great car.

Or lastly, I can go out and buy a car from someone who makes cars. Now as absurd as it may seem, 100% of the people in this world, save for the odd eccentric here and there, go out and buy a car when they want to own a car, and yet 90% of these same people when they are in a senior recruiting position will effectively choose the option to either a) build from scratch their own “car”, or will b) cobble together some hybrid of parts onto their old “horse and buggy” recruiting process, ensuring again that their “car” is neither great, nor even much of a “car” for that matter.

Yes, it’s a stretch, I know. But not so much so that the logic is flawed.

And yet looking at the pictures (thank you, Google), it would seem that I’ve defeated my own argument that RPO doesn’t cost more, and can actually cost less, than my existing process, because surely a Ferrari costs more than the old horse and buggy you see up top. And you’d be right.

Unless, of course, you try to build your own Ferrari from scratch. Now we’re talkin’ serious coin.

Of course everyone doesn’t need a Ferrari (I do, but that’s a whole different conversation, and a notion my wife has not quite disabused me of), but if you’ve found that your recruiting process is woefully inadequate and/or antiquated, the most expensive option you can pick to address the challenge is to create everything from scratch. This point is one that I think everyone can agree upon.

But what if you’re not back in the “horse and buggy” days of recruiting? What if, actually, every thing is functioning fairly smoothly but you’ve been asked by your organization to see if additional savings can be found? Are there additional efficiencies that can be squeezed out to further streamline your efforts? Can all this (whatever “this” is) be done for less?

In the current economic environment, this question is being asked daily.

RPO vendors can do one thing that internal recruiting departments can never do — they can bring economies of scale to an equation just as a manufacturer can bring economies of scale to the fabrication of highly complicated components. But unlike the anonymous and repetitive process involved in manufacturing something, RPO is definitely not an assembly line workflow, as every customer’s process is different, and their needs and challenges are going to be unique to them. A complete and thorough understanding of these processes is, in fact, a critical component of a successful RPO engagement.

Aon’s RPO group has 400 professionals dedicated to serving our clients. We have the ability to source and assess candidates 24 hours a day, 365 days a year. Our parent organization generated $1B in revenue last year, and the parent company generated $10 billion. To suggest Aon may have more resources available to provide a truly world-class recruiting process to an organization than it would ever consider building for itself would be an understatement, to say the least.

And all of this is why RPO can actually cost less — and deliver more — than your existing process is costing your company, and why we continue to save our clients hundreds of thousands or millions of dollars annually on their recruiting costs.

Is it possible that engaging an RPO vendor will actually cost more than what you’re currently spending on recruiting? Of course. Some people want a “Ferrari”. But for the vast majority of clients, the savings involved are a significant reason, if not THE reason, for engaging with a partner that can deliver these services for less, and can do so more effectively.

RPO costs too much? Not likely.

Michael