Recruiting the right person is a tedious task. As a businessperson, you want to focus on doing what you should be doing — grow your business. For this reason, you need to learn how to outsource recruitment and free some of your time to being IN the business rather than ON it.
Recruitment helps you find the right candidate to fill vacant positions in your company. Maybe you have a new client or project that requires manpower. The first thing that will come to your mind is fill it up with one of your current employees. The problem is that they may become overwhelmed and may no longer become effective in their core task.
Another reason why you may need to hire new people is because you relocated and need re-staffing. You may already be tied up with running your business and may not be able to fulfill the requirement without outside help.
Outsourcing recruitment can help you find the right people to fill up your vacancies and focus on the core activities of your business. If you are just getting started with outsourcing to a provider, this article will guide you on how to effectively and successfully implement outsourcing.
This article will cover the following:
- Signs You Need To Outsource Recruitment
- Advantages and Disadvantages of Outsourcing
- In-House Recruitment vs Outsourcing: Which is Better?
- Steps in Outsourced Recruitment
Signs You Need To Outsource Recruitment
The recruitment process can be challenging, especially if you are focused on growing your business. Without experience, you are bound to make mistakes finding the right candidate for your requirements. Finding the right people is important for the achievement of business goals.
Making the decision to consider recruitment outsourcing isn’t an easy one. There are certain factors you need to consider before partnering with a provider. But when is it time to hire a third-party provider for hiring people for your team?
1. Little or No Recruiting Strategy
Your recruitment team is going through the motions but is marching to the beat of their own drum. While operations are going smoothly, any inconsistencies in your recruitment process can impact the ability of your organization to successfully hire quality talent. Your hiring process takes a long time and your recruiters don’t respond right away. This doesn’t bode well for your potential candidates.
Your recruitment partner has knowledge of industry best practices and knows how to optimize the speed of your current talent acquisition by identifying and streamlining any gaps in the process.
2. Recruiters are bogged down
The ideal set-up is for your department to be focused on a particular project or company-wide initiative But sometimes your hiring demands change, the question is: Will your recruitment team be up to the task? There is a common misconception that outsourcing will reduce headcount by supplementing the role of busy staff members. On the contrary, when learning how to outsource recruitment, you will learn that the opposite will happen. The outsourced team will handle the burdensome and repetitive administrative tasks so your internal team can focus on the more strategic tasks.
3. Need A Cost-Effective Scalable Recruiting Solution
Although you could always hire temporary employees for a certain project, expect costs to skyrocket in the long run especially if it becomes company culture. Outsourcing recruitment is cost effective mostly when it deals with the ebbs and flows in hiring. This is because it is the provider who will determine the need to increase or decrease recruiting resources, not you.
4. Lack of Recruiting Metrics
One reason you might be considering recruitment outsourcing is that there may be some aspect of your talent acquisition strategy that is not performing according to expectations. Your hiring numbers aren’t at the level you want them to be. In addition, there are current roles that your team is struggling to fill, or there is a need to augment your efforts to push through high volume requisitions.
5. New Recruiting Industry And/Or Geography
The recruiting landscape has changed over the years. When you need to increase the quantity and quality of your permanent hires quickly, it may be worthwhile to hire an outsourcing partner to do that for you. Outsourcing providers have experience working across various disciplines in multiple geographies. Your current recruiting team may have limited experience but the provider may have knowledge of best practices and learned strategies.
Advantages and Disadvantages of Outsourcing Recruitment
When learning how to outsource recruitment, you need to know how it will benefit your company. Outsourcing has its advantages and disadvantages so you need to weigh your options carefully. Let us first take a look at the pros of outsourcing.
Reduce Overall Costs
In today’s economy, every business wants to reduce costs. Recruitment also entails other activities such as job advertisements, background screening, and recruiting software. Maintaining all of these in-house can be costly to your company.
Another cost that needs to be considered is the cost per hire. By outsourcing recruitment, both the cost-per-hire and time-to-hire is greatly reduced. This is because the provider will use dedicated resources, share the risk, and streamline the process.
Increased Recruiting Effectiveness
The job market has become so competitive that your in-house recruitment team may not be able to find qualified candidates. They may not be able to accomplish recruiting process enhancements with current staff and when recruiting requirements start to pile up.
With recruitment outsourcing, the provider has the ability to reach out to additional candidates, engage even with passive candidates and bring more effectiveness in the recruiting process.
Focus on Core Business
During bulk or greater volume times of recruitment, your human resource employees will not be able to concentrate on their core responsibilities. It will have a negative impact resulting in decreased productivity and workflows. In addition, their ability to supply services for payroll, compliance, and conduct for resource motivational programs will be affected.
With outsourcing, there will be no interference to main corporate actions. It allows employers to pursue their best talents without distracting their current business operations.
High Turnover Ratio
High turnover is the cost of reduced productivity, lower client services, and lower staff management. However, this does not have something to do with the recruitment skills or compensations but more on the recruitment functions.
87% of employers said that improving retention is their top priority. High turnover can put a strain on company resources. Once this happens, outsourcing is a faster and affordable way to break employee turnover.
Improved Growth and Competitive Advantage
Your recruitment team may not have the capacity to meet the changing needs of your company. An outsourced provider offers dedicated and knowledgeable resources, better recruiting technology, and advanced social recruiting methodologies.
If you are just a small business and don’t have similar expertise resources of your larger competitor, outsourcing will provide highly qualified candidates to build your company with key employees and even sustain it with additional resources.
Improved Hiring Manager Satisfaction
When learning how to outsource recruitment, you will realize how it can help your hiring procedure. Outsourcing reduces the stress related to recruitment. You can fulfill job requirements in a healthier way. With the help of a recruitment agency, you can be satisfied with your achievements and the way candidates are recruited in your organization.
Superior Employment Brand
The employment brand is the individuality of an organization as an employer. When all recruitment aspects are working good, the company can see improvements in their employment brand. If your employees are healthy and satisfied, you can also expect the same from your probable candidates.
If your hiring managers are happy and working in a stable way with the outsourcing agency with a healthy recruitment process, the individuals who have gone through the process can only say better things about your company.
Disadvantages of Outsourcing Recruitment
While there are benefits, it is also worth knowing about the disadvantages of outsourcing recruitment. This knowledge will help you decide whether outsourcing is right for you.
Deficiencies in Company Knowledge
In some cases, the outsourced employees lack an understanding of the company culture compared to a regular employee. This lack of knowledge of company culture will be passed on to the new employee during the recruitment process. In addition, the provider may recruit employees who do not fit the overall culture of the company. If the employee is not the right fit, your company can suffer.
Outsourcing may result in the release of sensitive company information. For the provider to provide adequate service, some sensitive information about your company structure, product information, or other inner workings is needed for the vendor to perform without hindrance. Providing sensitive information can result in possible information leakage.
Dependency and Loss of Control
With outsourcing, you may give up too much control over your human resource functions or you may become too dependent on your provider. It also poses the risk of you not being able to operate successfully if outsourcing is no longer your option or if the outsourcing provider changes the terms of the contract.
If you are considering recruitment outsourcing, you may opt for a short-term contract or one without excessive penalties for canceling or changing providers if things don’t work out.
Impact on Employee Morale
Your employees could react negatively to outsourcing one or two key functions in the company. They could think that their job is also at risk and will eventually be outsourced as well. Be careful in how you deliver the message of outsourcing to your employees.
In-House Recruitment vs Outsourcing: Which Is Better?
When learning how to outsource recruitment, you may have the dilemma of whether it is right for you or you should recruit in-house. Both have their own pros and cons but your decision will depend on certain factors.
Scope of responsibilities
With in-house recruitment, your team will have an edge over knowing your company culture, industry fit, and specific hiring needs. Your recruitment team works in different areas of responsibility such as workforce planning and development, employee and labor relations, risk management, employee engagement, and recruitment.
With outsourced recruitment, the provider can be flexible with managing responsibilities. They can guide you on effective workforce planning, employer branding, training and development, building long-term talent pools, and others.
If your in-house team is already loaded with other HR responsibilities, they may not be able to handle recruitment tasks. In addition, recruitment may take away their valuable time from their other HR responsibilities. If you are just a small business, outsourcing recruitment may be your best option.
Hiring in-house employees comes with a price. You have to deal with financial challenges like fixed HR expenses and intangible costs. In addition, you also have to pay them benefits, provide training, and other overhead costs.
Recruitment outsourcing reduces your costs significantly. Also, you don’t have to pay monthly fees on the recruitment platforms and tools. The provider will cover all the associated hiring costs while controlling recruitment spend.
Again, if you are managing a small business, you will have to cover all the expenses. In this case, outsourcing may be your best option.
Hiring in-house could come in handy when business is booming. But what if you realize that you need to downgrade after a few months? Your company could be left with dents in finances and a surplus of resources. Scaling your business at a short notice can be challenging for an in-house recruitment team.
With outsourcing, you can expand the size of your team at an affordable rate. You can focus on more important business while ramping up your team.
Outsourcing to a provider offers a more scalable approach for small businesses against having your own internal recruit team. If you’re planning to scale your business, outsourcing is the best option.
Degree of Control
When you have an internal recruiting team, you have full control of your team because they are focusing on your small business. You can easily delegate tasks and set priorities and workplace practices they can follow.
When you outsource, the provider may have other clients and you may end up fighting for their time. In the end, you may end up working with maintenance people whose only job is to keep the lights on.
In this area, you can work hand-in-hand with the provider. You can focus on strategic initiatives and internal affairs. The provider, on the other hand, can focus on hiring qualified candidates and the entire hiring process.
Surely, you wouldn’t hire an internal recruitment team that isn’t an expert in your field. However, some may not have experience in certain areas such as managing all the elements of recruitment, which is necessary to give your business a competitive edge.
An outsourced provider will utilize technologies that provide audit trails, comprehensive management information, better analysis, forecasting, and reporting for strategic headhunting.
Outsourcing providers have broader knowledge and spend more time in the job market looking for the right talent for their clients. They have an idea on what the perfect candidate looks like.
Steps In Ensuring Recruitment Outsourcing Success
Learning how to outsource recruitment can free up as much as 40 percent of your day. Your in-house team can focus on their mission critical work. If you are considering taking the outsourcing route, here are some tips to ensure its success.
Choose The Services Carefully
Your choice of service will depend on the goals of your business. Tasks like pipeline management are best handled by a provider because they require a great deal of time. The same is true with succession planning. However, settling employee disputes, creating rewards and recognition programs, and other employee satisfaction programs are best handled by your internal team.
Transition Tasks Gradually
For outsourcing to be effective, you need to partner with a qualified, experienced HR service provider. Also, any changes and associated benefits should be clearly conveyed to employees. You should remain involved and conduct regular assessments of how the system is working.
Make Outsourcing An Ongoing Effort
The longer the outsourcing exists, the higher the contentment and satisfaction level of the employee will be.