Frequently Asked Questions (FAQ) about Recruitment Outsourcing Companies and Professional Search Firms
Embarking on the journey of professional search or recruitment process outsourcing (RPO) may feel unfamiliar to businesses, but fear not!
We have compiled answers to the most common questions about executive search, contingent search, retained search, RPO, pricing, and more.
With our comprehensive insights, you’ll be well-equipped to conquer any talent acquisition challenge and achieve resounding success.
Recruitment Process Outsourcing (RPO)
What does RPO stand for?
What is RPO?
RPO or Recruitment Process Outsourcing is the full or partial outsourcing of a company’s internal recruiting function to an external recruiting specialist. The external recruiting specialist, or RPO firm, assumes the role of the company’s recruiting function by owning and managing the recruitment process and related recruiting relationships, technology, etc. While RPO is typically used for direct hire employees, RPO can also be used for contingent labor with contingent RPO.
Learn more about what is RPO.
How does RPO work?
RPO solves talent acquisition challenges for your organization by partnering with your internal recruiting team, building on your company culture, and providing value-added recruiting services to deliver high quality candidates. RPO engagements typically start by assessing your recruiting needs, evaluating your current recruiting processes and technology, identifying areas of opportunity, then designing an RPO solution that fits the exact requirements of your organization. Typically, the RPO process includes 5 phases.
Learn more about the 5 phases of recruitment process outsourcing and how RPO works.
The goal of RPO is to solve business challenges for your organization. RPO companies do more than just fill open positions; they serve as recruiting partners, acting as an extension of companies and offering comprehensive human capital strategies and solutions designed to achieve specific business goals. The benefits of RPO are extensive, including:
- Flexibility & Scalability – RPO solutions can adapt to the changing needs of your organization.
- Cost – Companies utilizing RPO solutions consistently indicate cost reductions as one of the greatest benefits, in addition to the improved candidate quality.
- Access to Quality Talent – RPO providers are experienced in sourcing for hard-to-fill roles and have built extensive candidate databases and networks.
- Speed of Hire – With access to the best recruiting technology, industry expertise, and a broad referral network, RPO can significantly reduce the amount of time it takes to fill each open position.
- Technology Capabilities – RPO providers offer unmatched access to best of breed technology that drives greater efficiency in the recruiting process.
- Target Sourcing Strategies – Successful RPO solutions rely on the development of custom, targeted sourcing strategies to identify the hard to find passive candidates for clients’ positions.
- Deep Talent Analytics – RPO providers invest in the technology necessary to help identify trends in your talent data and predict future performance and retention.
- Compliance & Risk Mitigation – RPO firms protect your company from legal and financial liabilities by maintaining compliance with the everchanging regional, national and international labor laws.
- Employer Brand & Candidate Experience – RPO firms help you assess and strengthen your employer brand to ensure your recruitment marketing resonates with the target audience.
Learn more about recruitment process outsourcing benefits.
Learn more about all aspects of RPO with a comprehensive guide to outsourcing recruitment.
RPO vs. Staffing – What’s the Difference?
The goal of a staffing agency is to fill short term needs quickly. That goal is reflected both in the price you pay and in the quality of the candidates. Staffing models place an incentive on speed over quality of candidates, since they won’t get paid if they don’t fill the position first.
When you partner with an RPO firm, you can expect better candidate quality, more tailored and effective recruitment strategies, lower costs, and greater flexibility as compared with a staffing agency. RPO optimizes your recruitment process, streamlines your operations, and focuses on long-term business strategy while reducing costs.
What are the types of RPO models?
There are several different types of RPO models that an RPO firm can offer to a client based on the client’s requirements. The most common RPO models include:
- Enterprise RPO – Enterprise RPO delivers a comprehensive recruiting solution that spans the breadth of your company. Enterprise RPO may take the form of fully outsourced, full cycle RPO engagements or targeted partial cycle RPO engagements depending on your needs. It includes talent acquisition strategies, flexible delivery models, strategic advisory solutions, talent analytics, and technology consultations. Enterprise RPO creates the most closely integrated partnership between the RPO solutions provider and the client. Learn more about Enterprise RPO.
- Partial Cycle RPO – In the partial cycle RPO model, you choose which recruiting activities you want to outsource and which ones you prefer to handle internally. You may engage us for select a la carte processes such as interviews, reference checks, pre-screening, candidate offer management, onboarding, or career transitions. With Partial Cycle RPO, we provide the specific services you need when you need them. Learn more about Partial Cycle RPO.
- Project RPO – Project RPO helps your company scale up hiring quickly, but it is in place for a limited timeline and has clearly defined objectives. This model is ideal for short-term hiring needs, such as a growth period or expansion into a new market. You choose whether to outsource the full recruiting cycle or only parts of it. Learn more about Project RPO.
- On-Demand RPO – On-demand RPO applies an RPO solution to an immediate need, such as a seasonal hiring demand for additional workers or a spike in hiring needs. Experienced recruiters supplement the efforts of your internal team with flexible talent acquisition services, industry-specific best practices, the ability to scale up or down quickly, and the option to turn on or off monthly with no extra fee. Learn more about On-Demand RPO.
- Contingent RPO – Contingent RPO acts as an extension of your talent acquisition department, giving you better quality contingent labor at lower cost, as compared to managed services providers (MSP) with vendor management systems (VMS). It blends the power of tried and true RPO models with the flexibility you need to manage a contingent workforce. With contingent RPO, you get the benefits of direct sourcing through an outsourced provider. Learn more about Contingent RPO.
What is a contract recruiter? How is RPO different?
Contract recruiters are professional recruiters that typically work with several client companies to place candidates for a specific period of time. They usually charge an hourly rate, and they take their candidate network and talent pool resources with them at the end of the contract. Contract recruiters may be used to place candidates for an interim period, such as maternity, paternity, or long-term medical leave. Typically, the contract recruiter will handle the administrative or transactional functions of the recruitment process, leaving little or no time for deeper sourcing of qualified candidates. Learn more about contract recruiting.
By contrast, RPO integrates with your team to offer customized strategies based on your needs. With RPO, you get greater flexibility and long-term hiring strategies, and you typically pay a lower fee per hire. You also keep your talent pipeline and qualified candidate lists when the engagement is finished.
How much does RPO cost?
Pricing varies based on volume, position type, location, services, and other variables. RPO solutions typically fall into one of these four pricing models:
- Monthly management fee based on volume, position type, or services contracted
- Cost per hire based on volume, position type, location, or other variables
- Management fee + cost per hire
- Cost per transaction based on predefined transaction such as requisition opened, interview scheduled, or offer extended
In an RPO arrangement, the overall cost-per-hire will be significantly lower for multiple hires, as compared with a staffing agency.
Is RPO worth the cost?
Can an RPO firm help with executive search or seasonal hiring?
It depends on the RPO firm that you select. Many RPO companies offer ancillary talent solutions. In the case of Hire Velocity, we offer both executive search and specialty search solutions to help you find and hire the best leaders for your company. Our search consultants have experience recruiting for C-level and senior executive roles as well as individual production roles. Learn more about executive search.
Typically, RPO companies offer RPO solutions to help with your seasonal hiring and other short-term hiring needs. For hiring contingent labor, Hire Velocity offers contingent RPO solutions, and for hiring permanent employees, we offer a variety of RPO solutions.
What metrics do RPO companies use to measure RPO success?
When engaging with an RPO firm, you need to be able to measure the impact of the RPO engagement on your organization. To do so, it’s important to have specific metrics that you can measure before and after an RPO engagement. Typically, metrics used to measure RPO impact, include:
- Hiring manager satisfaction
- Cost per hire
- Time to offer
- Time to fill
- New hire retention
- New hire turnover
- Candidate satisfaction
- Recruiting process conversion rates
In addition to these metrics, other KPIs are based on the specifics of the engagement. During the due diligence and implementation phase of a RPO engagement, companies will discuss and finalize the RPO service level agreements, which will reflect the key metrics that both companies will be measured against and held accountable to.
Learn more about RPO service level agreements.
Do RPO firms have annual or project hiring minimums?
Many RPO firms have hiring minimums, either on an annual or per project basis. Some RPO companies require a minimum of 200-500 hires to engage.
However, at Hire Velocity, we believe that every company should have access to solutions that will save you money and improve the quality of new hires. If you’re currently handling all recruiting by yourself, RPO can free up the time your HR and hiring teams are spending on recruiting. Alternatively, if you’re currently relying heavily on staffing agencies or headhunters, RPO can improve the candidate experience, improve your employer branding, increase your candidate quality, improve new hire retention, and decrease your recruiting costs.
Will I retain control over hiring decisions?
Yes, if you want to retain control over the hiring decisions. In most cases, RPO companies will give you the option to either retain or release control over hiring decisions.
Learn more about how recruitment process outsourcing companies engage and determine how hiring decisions are made.
Is my business too small to benefit from RPO?
No. If you need quality candidates to facilitate business growth, RPO can help you, although you’ll have to find an RPO firm that doesn’t have hiring minimums, like Hire Velocity. Quality people make the difference between success and failure for a business, which means that finding top quality candidates is important no matter how large or small your company.
Learn more about how recruitment process outsourcing companies can work with companies of any size.
Can I customize RPO solutions for my needs?
Yes. Whether you are interested in diversity recruiting initiatives, short-term project hiring, or a comprehensive recruiting strategy, an RPO company can design a solution that will achieve your desired goals and promote your brand without squeezing you into a one-size-fits-all hiring approach.
Do RPO firms provide recruiting technology?
Yes, as part of RPO solutions, RPO teams typically have access to the RPO firm’s technology suite. If your company doesn’t have an existing recruiting technology infrastructure, RPO companies may offer client recruiting portals, possibly at an additional cost.
In the case of Hire Velocity, our recruiting teams have access and rely heavily on our proprietary recruiting platform, which includes technology to streamline sourcing, screening, scheduling, interviewing, reporting, and more.
Additionally, either as part of a broader RPO solution or as a standalone service, we will evaluate your technology platform and make recommendations based on your organization’s strategy. Typically, our technology evaluations include:
- Enterprise architecture and strategy
- Workforce management roadmap
- Applicant tracking systems
- Sourcing platforms
- Social recruiting applications
- Talent attraction automation
- Integration with back office legacy systems
Can RPO companies integrate with our existing applicant tracking system (ATS)?
Yes, typically RPO companies can and will utilize your company’s existing applicant tracking system (ATS), although you should ask if there’s an additional cost associated with that. RPO firms work with a large number of companies, all with different applicant tracking systems or other recruiting technology, so the RPO teams are well-versed in a variety of recruiting and HR platforms.
At Hire Velocity, we can seamlessly integrate the RPO process with your applicant tracking system, or we can use our own technology platform to deliver the results you’re looking for with any of our RPO solutions.
Will candidates be a good fit for my company culture?
Cultural fit has proven to be a strong indicator of success and retention for employees. As such, it demands that effective recruiting strategies include assessments of candidate soft skills, patterns of behavior, and value systems in addition to their education and experience.
Learn more about how recruitment process outsourcing companies recruit for candidates that fit your company’s culture.
How does Hire Velocity perform compared to its competitors?
Hire Velocity has been consistently recognized over the years as both a top RPO company as well as a top executive search firm by leading industry organizations and news outlets. We received multiple awards for exceptional client satisfaction and customer service as well as thought leadership in recruiting, HR, RPO and executive search.
What type of professional search services do you provide?
Whether you are looking for a contingent or retained search, a professional search partnership with Hire Velocity guarantees access to the most qualified talent. With our professional search solutions, you can make hires that are sustainable and well-suited to your long-term goals. Our professional search solutions include executive search, retained search, and contingent search.
Retained vs. Contingency Search – What is the Difference?
The primary goals with contingency search are speed and volume. Search firms operate under a pay-per-hire model in which no money changes hands until a candidate has been hired. Often in a Contingency Search, you will see the most active candidates from the market.
In a retained search engagement, clients partner with a recruiting firm to identify the top talent in the market for their open positions. The client pays a retainer to initiate the search and a fee upon hiring, instead of solely paying upon hiring. While this may be a drawback, it benefits you as the search firm can prioritize quality over speed. The retained partnership is an exclusive arrangement in which the recruiter works with you to gain a deep understanding of your organization’s Ideal Candidate Profile which is based on credentials, skills, and cultural fit. The recruiting firm then digs deep into the passive candidate base to identify the best possible talent and build interest in your organization.
Learn more about Retained Vs. Contingency Search: What’s the Difference?
When do you use retained search services?
- A position that you haven’t been able to fill directly
- There is a niche role to fill, requiring specialized skills or specialized qualifications
- A retained recruitment service is also a good idea if you have had no luck with contingency recruiting
- It’s wise for companies seeking senior management and directors to engage a retained recruiter as they have the incentive, resources, and time to identify hard-to-find candidates that can’t readily be sourced.
- When your company’s recruitment process is time-sensitive, a retained recruiter will utilize their full resources and search techniques to find the talent your company needs.
- To reach out to passive candidates, who are not seeking another job but may be interested in yours
- You need help shaping the role and the compensation so that it supports company goals and initiatives while also appealing to top candidates
What is executive search?
A dedicated recruitment service, executive search specializes in finding qualified and experienced candidates for C-suite and senior-level roles across a wide range of industries. They have the experience and resources to identify the most qualified candidates within the market that meet the criteria for your specific company and open position and build interest with even the most passive candidates through a specialized process. An executive search firm offers a comprehensive hiring solution through an extension of the company’s HR/Recruiting department. Additionally, an executive search firm can build a candidate pipeline for future executive positions within your company.
To learn more about Hire Velocity’s executive search solutions, visit our executive search page.
Why executive search?
Some of the main reasons to work with an executive recruitment agency are expertise, specialization, and sourcing strategy —they know exactly where to look for the best executive professionals to quickly identify the right person for your open position. Often the most qualified candidate for your senior-level position isn’t even on your radar, let alone in your industry. Executive search firms will know exactly where to look for these hidden gems.
They will conduct extensive research and map out talent and can also handle salary negotiations and onboarding. Some other advantages of working with an executive recruiting firm include the following:
- Global Network of Talent
- Outside Guidance
- Avoid Poor Hiring Decisions
How can an executive search recruitment firm help your company?
What is Hire Velocity’s professional search process?
The search process can vary depending on the position you’re filling. Keeping your recruitment efforts on track is important. It outlines the major milestones you need to hit when searching for someone to fill the position as well as how long each step should take. Here is an outline of what a typical search will consist of:
- Define Objectives & Specifications
- Source & Screen Candidates
- Conduct Interviews
- Select Top Candidates
- Select & Hire Candidate
How long does the professional search placement process typically take?
There are many factors that come into consideration when looking at the time it takes for us to make a professional search placement, including the complexity and level of the position as well as each client’s internal interviewing process. Typically, our clients can expect to be presented with strong, qualified candidates within one week, with our searches closed withing 45 to 60 days.
How much does a professional search cost?
Contingency search firms are only paid once you hire a candidate, they have presented to you. These firms will charge roughly 20-30% of the candidate’s first-year compensation. Nevertheless, since search firms only get paid once the candidate has been hired, companies must maintain constant contact with the search firm.
Retained search fees are like the total amount that a contingent firm will charge, but a small portion of the fee is due as a retainer due to the rigorous and robust process followed to identify and attract passive candidates. A Retained Search is typically advantageous for both clients and search firms because:
- Both are fully committed to the process.
- Both are in a strong partnership to find the right fit for the company.
How do you select a professional search firm?
Choosing the right search company for your hiring needs is crucial. When selecting a search firm, you should research the options available to you. Before you consider partnering with a search firm, ask these top questions to ensure the firm will meet your company’s needs.
- What is your experience hiring in my industry?
- How do you measure client satisfaction?
- What is your screening process?
- How do you charge for your services?
- Will you ensure confidentiality?
What areas or locations does Hire Velocity serve?
Hire Velocity has years of experience providing services to clients across North America.
What industry sectors or functions does Hire Velocity specialize in?
Our dedicated search consultants will help you hire outstanding CEOs and senior-level executives in business and financial services, healthcare, logistics, manufacturing, non-profit, retail, technology, cyber security, and the Federal, Defense & Aerospace arena as well as functional roles including finance, accounting, human resources, customer service and call center, IT, and sales.
Learn more about Hire Velocity’s professional search solutions.