Featured Article: "Global RPO - Planning for What Lies Ahead"
Today many companies are tightening their budgets and utilizing talent around the world either through outsourcing or global expansion. Multinationals are under the same pressure to reduce or cap headcount, reorganize how talent is structured throughout the company, and expand where resources are more available and cost effective.
As Tom Friedman explains in "The World is Flat," the game of business now takes place on a level playing field. All competitors have an equal opportunity, and countries, companies, and individuals must continually adapt to remain competitive in a global market. The trend that physical locations have become irrelevant has impacted all levels of business operations, but arguably its largest impact is on the approach to attracting, employing and utilizing talent.
In recognition of the critical role that talent acquisition and management plays on a global scale, Pinstripe and Ochre House are hosting a webinar with a panel of HR/Recruiting Leaders from such leading global companies as Citigroup, Kodak, and McAfee to discuss the strategies, challenges and opportunities related to global staffing and recruiting today and in the near future.
As a preview to this webinar, this month's newsletter is dedicated to a brief history of global outsourcing and the value of RPO as a solution for business around the globe.
A brief evolution of global Human Resource Outsourcing (HRO)
The market first witnessed a rush to HR outsourcing in 2005 and 2006. It was an exciting time of promise and business potential. But looking back, the global opportunity didn't live up to everyone's expectations. Both U.S.-based and European multi-nationals were focused primarily on large countries. Giants like Hewitt, Convergys, and ACS won massive engagements, but meeting the global needs didn't execute as well as anyone expected...including the providers. As a result, we have seen a shift toward more targeted HRO contracts that include fewer processes and a longer term multi-national rollout plan. The reality is that wanting to go global and delivering globally are vastly different.
According to Hary Bottka, recruiting and staffing outsourcing advisory leader within the HR practice at TPI, "A lot of HRO companies that were espousing that they could handle anything around the globe, have scaled back. Although some, like IBM and Accenture, continue to serve that market, many have realized that they bit off more than they could chew, and can't handle these multinational clients," he explained. "RPO, on the other hand, shows more promise. I believe industry leaders will take a more measured approach, and have a better chance of success."
Why RPO?
Nationally and globally, more companies are turning to RPO than ever before. In addition to the hard dollar savings, RPO has numerous less quantitative, but very important key benefits. RPO is often credited with delivering a better quality of candidates, more quickly, who stay longer. It is not unusual to see between up to 40 percent operational savings as a result of outsourcing, but the longer term strategic benefits of improved hiring cycles, reduced turnover and securing better candidates can be equally valuable. Other examples of value RPO delivers include:
- Talent pipelining
- employment brand building
- employee engagement from the moment of accepted offer
- moving the function to a flexible, scalable and variably-priced "utility"
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