As 2011 was coming to a close, I sat down and made a list of my 21 RPO observations from the previous 12 months. However, since I never blog over 500 words (a self-imposed rule), I reduced my list by two thirds to just 7 key observations.
So here are my top 7 RPO Observations for 2011:
- A group of RPO service providers talked a lot about total workforce solutions, but buyers were still mostly looking for standalone RPO offerings. In 2012, this should continue to help RPO service providers whose core product is Recruitment Process Outsourcing.
- One of the most frequently asked questions of 2011 was about our recruiters and whether they were employees of Pinstripe or just contractors. All of Pinstripe’s recruiters are employees; however, I learned that, unlike Pinstripe, a majority of RPO firms are leveraging significant numbers of contract recruiters. This contractor “situation” results in higher recruiter turnover, less program continuity and greater hiring manager frustration.
- More potential clients asked for a cost per hire fee model is 2011. In addition, they also wanted us to ensure program reinvestment and resource continuity. I spent some significant time (successfully) explaining that a combination of fixed and variable costs can be the most optimal pricing structure for driving reinvestment, continuity, results and return on investment.
- A major acquisition was completed by a large payroll services/human resource management organization. It seems this move will help them compete in some bundled HRO deals; however, the transaction may not benefit them as much in the Recruitment Process Outsourcing only deals. I’m watching this one closely as 2012 unfolds.
- If a RPO provider was not measuring up, then incumbency meant very little last year. With many 1st generation RPO contracts expiring in 2011, companies that went back out to RFP had clearly decided that RPO was the right solution; however, they also decided that they needed to find a new service provider.
- There was both more talk and more actual global and multi-national RPO deals in 2011. In addition, any service provider who said they can do it all themselves globally without partners, lost credibility in the marketplace. RPO buyers are getting more and more sophisticated and their due diligence is leading them to more credible solutions.
- The RPO market grew tremendously in 2011 and soon there will be a lot of press releases about 2011 results. As you read these announcements, please note that any service provider extolling their 10% or 15% or 20% or even 25% revenue increases, should also mention that they did not keep pace with overall industry growth by 10% or 15% or 20% or even 25%.
In conclusion, I perused of a lot of year end reviews about books, movies, restaurants, sports, politics, etc… and a frequent topic of discussion was whether or not it was a “magical” year.
So in your opinion, was 2011 a “magical” year for RPO? For me, it was really interesting but never quite reached the “magical” level.
Post contributed by Barry Diamond. Follow me on Twitter @bddiamond
Post contributed by Barry Diamond. Follow Barry on Twitter @bddiamond
In his NPR piece It's Time for Baseball to Stop Wasting Fans’ Time, Frank Deford shared:
“As a fan, there are always things I wish the various sports would do to improve themselves. For example, I wish more football coaches would go for it on fourth and short yardage; I wish NBA referees would stop giving breaks to superstars; I wish they'd get rid of the goons and the fighting in the NHL. But most of all, as we begin a new season, I just wish they wouldn't take so long between pitches in baseball games.”
So, what do I wish for in Recruitment Process Outsourcing that would improve our industry? Like Frank Deford’s wish that baseball move faster, I also wish that RPO opportunities would move more rapidly. Over the years, I have observed truly significant ROIs lost because stalled decisions have killed RPO initiatives entirely.
Here are 3 more things on my RPO wish list:
1. I wish there was more emphasis on RPO’s value in managing global talent and improving the business value of recruiting and less focus on direct cost savings.
2. I wish there was more collaboration and sharing during the RPO RFP process, so solutions (including pricing) were more targeted from the outset.
3. I wish more people read RPOlosophy.
By Barry Diamond
Ever bought cereal or snacks just because it says "high in fiber" or "low carb" on the front of the package? Just admit it. We all have.
What's important for consumers to know about food at a glance?
While high in fiber and low in carbohydrates isn’t bad, a recent report released by the Institute of Medicine says, that reducing calories, saturated fat, trans fat and sodium, is more important.
That's because we consume way too much of these, and our overdoing it is strongly linked to diabetes and heart disease.
There is a parallel situation in Recruitment Process Outsourcing.
Have you ever considered engaging a RPO firm because it says “lower cost per hire” or “reduced cycle time” on the front of their website? That is what most RPO firms plaster on their home page and we seem to be fed a constant diet of these two virtues.
So, what is truly important for consumers to know about Recruitment Process Outsourcing at a glance?
Clearly, cost and time are critical. But what about new hire quality, stakeholder satisfaction, scalability, and transformation? Or maybe global RPO delivery or recruiter quality should be added to the RPO nutritional plan.
Many RPO programs are succeeding because the service provider and client are focusing on more than just cost and time. However some unfortunate situations have arisen because of a preoccupation with cost and time. Predominately focusing on these two elements is like eating a low carbohydrate, high fiber diet without regulating calories, fat, salt and sugar intake and thinking you are going to be healthy.
The first question we should be asking is not whether our outsourced recruiting program costs too much or too little or whether it moves too fast or too slow, but whether the RPO program is working and delivering what the organization needs.
By Barry Diamond
As a frequent RPO traveler, one of my greatest fears is the bedbug. Infestations are popping up across the country at an alarming frequency. This fear of swarms of bugs feeding on me actually supersedes any apprehensions I have with the dangers of flying.
Everywhere I turn the news that bedbugs are spreading at a disturbing rate dominates. It seems that news organizations are all about sharing the blood sucking, creepy details with us.
I was discussing my bedbug phobia with a colleague, who blurted out: “Yeah, bedbugs are spreading as rapidly as RPO!”
Interesting comparison, but does this correlation really hold up beyond this one obvious observation? In order to find out, I decided to do some more investigation. I quickly engaged a few Pinstripe colleagues and queried them on the Bedbug RPO subject. Other than the proliferation comparison; here are few other responses I received:
Bedbugs and RPO are:
- Extremely persistent
- Need a host to thrive
- Don’t discriminate
But there is a key difference: Bedbugs cause distress; while Recruitment Process Outsourcing brings relief. In fact, they are nearly at opposite ends of the misery/pleasure spectrum.
A special thanks to my wife, Barbara, for this week's blog topic.
By Barry Diamond
David Eagleman, a neuroscientist, who has dedicated his scientific research to the relationship between the timing of perception and the timing of neural signals, recently coined a new term: possibilian. He came up with this word to describe his approach to his cutting-edge research on time perception, Neurolaw and Synesthesia.
So what is a possibilian?
According to David Eagleman, a possibilian is a word to describe those who “celebrate the vastness of our ignorance, are unwilling to commit to any particular made-up story, and take pleasure in entertaining multiple hypotheses.”
The more I ponder this, the more I believe Recruitment Process Outsourcing should adopt the word possibilian or RPO possibilian.
It’s perfect word for those Global RPO and talent acquisition influencers who continue to expand the industry boundaries, challenge conventional wisdom, create new delivery models, and refuse to accept the status quo.
As a matter of fact, we should start an annual Global RPO Possibilian award.
Any 2010 nominations?
By Barry Diamond
I was scanning stories on NPR the other day, when I came across a book review about the periodic table. Normally this subject would put me in a coma and I was just about to pass over the story when I saw the words “fun” and “intrigue” in the title. These are 2 descriptors I would never associate with this topic and my interest level decidedly increased (obviously, I’m a sucker for a good title).
Most people are like me and clearly wouldn't describe the periodic table of elements as lots of fun and full of intrigue. But Sam Kean in his new book, The Disappearing Spoon, shares with us many extraordinary stories that captivate and hold one’s attention.
As I continued to read more of the review, I realized, like the periodic table, RPO (and Pinstripe) too has both interesting stories and note worthy characters.
Perhaps, recruitment process outsourcing doesn’t have a character like Montana U.S. Senate candidate Stan Jones, who, during his campaign, began drinking liquid silver to improve his immune system and ended up with a permanent side effect - blue skin.
However, we do have our share of stories and personalities. For example, the 2010 Baker’s Dozen is about to be released and the global recruitment process outsourcing industry is buzzing with speculation and intrigue. While we wait for the results questions abound (i.e. Who will rise? Who will fall?)
For us, this event represents varying levels of intrigue, conjecture, innuendo, and implication. To most outside of RPO, this list of 13 top service providers goes like the periodic table relatively unnoticed. However, to those of us involved (including potential clients) this is just as gripping as the periodic table of elements is to the thousands who recently purchased Sam Kean’s book.
By Barry Diamond
Being a political junkie, I can’t help following the Chelsea Clinton/Marc Mezvinsky nuptials. While some secrecy surrounds the event, the safe bet is that the wedding will take place on July 31st in Rhinebeck, NY.
Americans seem obsessed with the gala and the news outlets are going crazy with important stories like:
• Has Bill Clinton kept his promise of weight loss?
• Will Barbra Streisand sing at the wedding?
• How will Chelsea’s marriage to a Jewish person impact Hillary's Middle East politics?
Lost in this frenzy is the story of Emn Haddad-Friedman. Emn is the other bride getting married on July 31st in the Rhinebeck area. For over 2 years Emn and her mother have been planning her wedding and working out every detail. Now it appears that Emn and her wedding guests may have trouble just getting to their location so there can be a wedding at all.
Emn, her mother, and her future husband, Alex Bero, have started creating contingency plans to insure that their wedding happens. Hopefully, their precautions will pay off; however, I am impressed by their ability to persevere and not give up or give in despite adversity and roadblocks. Emn is quoted as saying “If none of the guest can get to the wedding, we’re stilling getting married…As long as we’re there, a witness and someone who can marry us, we’re doing it.”
When I think about the underlying message, I realize that sometimes in my Recruitment Process Outsourcing world that no matter how well we design and execute an account strategy at Pinstripe, there are forces beyond our control. We may have worked and worked on details and deals only to see things disrupted and derailed by something or someone unanticipated. Sometimes a new talent acquisition stakeholder unexpectedly takes over with new relationships and priorities or strategic sourcing enters the process late with new requirements or an acquisition makes global talent acquisition strategies more complicated or the gloal economy gets flipped upside down or right side up and strategic talent acquisition is either paralyzed with fear or opportunity.
Regardless, we must adjust, be prepared, and carry on. And in the end, no matter what the result, we have to endure the good with the bad and keep things moving in the right direction.
At the end of the day, we are all more like Emn and Alex versus Chelsea and Marc. We all have stuff happen and we all must adapt.
***A special thank to Machie Madden from our PR firm, LandersMadden, for this week’s blog idea***