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5 GLOBAL TRENDS IN RECRUITMENT OUTSOURCING D. ZACHARY MISKO

5 Global Trends in Recruitment Outsourcing

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This ebook offers a recruitment outlook for the next year. It will be defined primarily by the following factors: • Ongoing uncertainty in global markets requiring a greater focus on contingent labor and maximizing value from people resources; • Increasing competition for key skilled labor in the science, technology, mathematics and engineering fields where growth is strong; • Greater focus on the efficiency of hiring decisions and the management of the talent pipeline.

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Page 1: 5 Global Trends in Recruitment Outsourcing

5 global trends in recruitment outsourcing d. zachary misko

Page 2: 5 Global Trends in Recruitment Outsourcing

22

recruitment outlook for 2012/13the great (global) melting pot

Today, the entire world has become an

employment melting pot. Borders seem to

dissolve as organizations seek out talented

individuals to drive innovation and efficiency

at a scale and speed never before seen.

Yet, workforces are shrinking in more

regions than they’re growing, and the rise

of the knowledge worker and the free

agent has already made finding qualified

workers to fill permanent, full-time roles

increasingly difficult. Diminishing supply of

talent, and the development of technology

that can facilitate data sharing and high

quality collaboration, has led to the

emergence of a truly global workforce.

Organizations and HR professionals are

tasked with adapting to this diverse

landscape, and part of doing so requires

a sea change in the way they think about

where candidates are, how to connect

with them, and what candidates are

looking for in terms of employment.

Increasingly, this has required organizations

to reconsider how permanent, temporary and

contingent labor is purchased and managed.

There is no doubt that the complexity (and

the potential for competitive advantage) that

workforce strategies now embody is putting

Recruitment Process Outsourcing (RPO)

providers on more organizations’ radars.

Today’s global workforce represents a

complex mixture of shifting demographics

and changing expectations and needs,

and because of this the recruitment

outlook for the next year will be defined

primarily by the following factors:

• Ongoinguncertaintyinglobal

markets requiring a greater focus on

contingent labor and maximizing value

from people resources;

• Increasingcompetitionforkeyskilled

labor in the science, technology,

mathematics and engineering fields

where growth is strong;

• Greaterfocusontheefficiencyofhiring

decisions and the management of

the talent pipeline.

Page 3: 5 Global Trends in Recruitment Outsourcing

3

trend #1 / targeting new sources of talent

the trend of reducing workforces has

spread far and wide. more people are

now leaving the workforce than entering

it, and there are few countries with skilled

workforces that can counter this trend.

After all, it’s not just a shortage of people

we’re talking about here, it’s a shortage

of talent that the world labor market must

contend with.

The overwhelming factor that slows or stalls

the recruitment process is “quality of hires”.

And this is a problem that is almost universal.

However, it is a major concern in the Asia-

Pacific region, where 67% of recruiters report

that they are having difficulty filling positions

with qualified workers. Almost one-in-four

organizations (39%) in the region say they

plan to hire 100 or more employees this year,

compared with 30% in the Americas, and

Organizations are innovating the use of RPO solutions, and using them to solve specific business needs.”

Just 17% of companies use RPO end-to-end, as their entire recruiting function; 60% use RPO selectively, for some elements of the process or for particular hard-to-fill roles and projects.

aberdeen group, “rpo 2011: rethink recruitment”

just 23% in the EMEA (Europe, Middle East,

Africa) region. So, talent appears to only be

becoming scarcer in the key growth regions.

The need to target new sources of talent,

including retirees, free agents, as well as

employees in emerging markets, is becoming

a key issue for organizations.

HROA/Kelly OCG’s 2011 Global RPO Report

Shortage of skilled staff / 79%

Salary uncompetitive / 42%

Location / 33%

Current recruitment process / 33%

reasons for problems in hiring

Page 4: 5 Global Trends in Recruitment Outsourcing

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trend #2 / matching the job to the person, not the person to the job

until recently, a request for hire went out

and hr determined whether the position

should be full-time or contract. now, a new

paradigm has emerged. instead of simply

determining the opportunity and seeking

the right person to fill it, the right person

now helps to shape the opportunity.

The new paradigm asks, “Where is the talent

that matches the need, and how does that

person want to be employed?”

The candidate—the ultimate client—has

had a shift of mindset, and recruiters must

go beyond static job postings, phone calls

and networking to find top talent. They must

more effectively match the opportunity to

the person, and this means knowing where

to look for the person, as well as how to

structure the opportunity.

Traditional methods such as cold calling

and in-person networking, print and brand

recognition/attraction, as well as social

media, blogs, microblogs, meet-ups and

more are all important components in both

the recruiter’s and the job seeker’s strategies.

An integrated approach using all the

available tools to find and engage candidates

where they live, work and play is bringing

sourcing to a new level.

The problem is that HR departments are

already overwhelmed by other demands

and this kind of highly targeted approach

is more than many can commit to. Instead,

many are looking to Recruitment Process

Outsourcing (RPO) to help them achieve the

desired integrated approach.

As such, the differentiator among RPO

providers will be how well they work with

clients to create opportunities that meet the

company’s needs, and candidate preferences.

For example, workers are increasingly

interested in free agent options such as

microwork, independent contracting,

temporary and project work, and

entrepreneurship. The global free agent

population accounts for at least 20–30%

of the entire workforce—44% in the U.S.—

and growing. In the 20–30 year-old age

demographic, average tenure on a job is

one year, whereas a contingent contract is

typically a year and a half.

Tenure and stability are no longer the

primary considerations for candidates—and

employment opportunities must reflect this.

it is estimated that

worldwide, the rpo

market will more than

double by 2015, reaching

nearly $4.4 billion.

nelsonhall “targeting rpo” report

Page 5: 5 Global Trends in Recruitment Outsourcing

5

trend #3 / recruitment outsourcer as strategic partner and brand ambassador

the complexity of recruitment for many

global companies today stretches

the resources and technology of in-house

hr departments.

Increasingly, companies need dedicated

infrastructure and expertise to find and

secure scarce talent in multiple employment

markets. Yet, if they outsource their

recruitment they need consistency and

genuine stewardship of their brand.

As RPO continues to gain traction

worldwide, buyers are beginning to see

ways to create added value. Providers

can identify inefficiencies and help create

better processes, standardize processes

across locations, scale up or down as

needed, and track important metrics, like

quality of hires. The latter involves long-term

measurement of factors like performance

scores, engagement, promotion and

turnover—and all of these factors are linked

to the talent acquisition strategy.

Because the candidate is now, more than

ever, in the driver’s seat, the candidate

experience is key to an employer’s brand. If

an employer’s brand says one thing to the

public, yet its talent acquisition and retention

strategies say another thing to job applicants,

the broken promise could significantly impact

the ability to attract and acquire top talent.

A strong employment brand can provide

an important competitive advantage, and

providers who reflect the brand can be a

true competitive differentiator. Most RPO

providers now offer employment branding

services, but organizations need to consider

more than just corporate messaging. Their

processes, people and technology must

facilitate a positive, satisfying experience

that is on-brand.

employer branding

is a top-five industry

game-changer.

hro today’s 2011 summit, europe

Page 6: 5 Global Trends in Recruitment Outsourcing

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trend #4 / the multi-country approach

globalization brings with it the need for

global recruiting solutions. in industries

where skills are highly transferable,

borders count for little as recruiters seek

talent wherever it may be found.

Increasingly, companies are taking a

multi-country approach to accessing talent.

Primarily, they are seeking standardized

and streamlined processes, scalability and

reduction in cost—while shoring up supply.

More often, this is requiring some form

of RPO with a provider that offers a truly

global solution.

the hallmarks of a provider with global

capabilities include:

• accesstoaglobalpoolofqualitytalent;

• theabilitytodelivertalentinlightof

differingcustoms,culturesandlanguages;

and

• aglobalfootprintorregionalofficesthat

provide deep regional knowledge.

single-country rpo still exists in far greater

volume than multi-country rpo. however:

• Nearlyhalfofmulti-countryRPObuyers

cover four or more countries of operation,

and the EMEA region ranks highest for

average number of countries covered.

• BuyersincludeEMEAnearlyasfrequently

astheyincludeNorthAmericanmulti-

country RPO deals.

• Buyersfrequentlyincludesomeofthe

emerging economies such as India,

China, Brazil, and Russia in multi-country

RPO deals.

• Theoriginofmulti-countryRPOdeals

is more broad-based now, with nearly

half of such deals originating outside of

NorthAmerica.

From Everest Group’s 2011 Multi-country recruitment report

nearly half of

multi-country rpo buyers

cover four or more

countries of operation.

everest group“2011 multi-country recruitment process outsourcing: hype vs. reality”.

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trend #5 / total workforce solutions

traditionally, hr recommended and

ultimately purchased rpo while

procurement purchased temporary

and contingent labor. but, changes in

workforce demographics (and attitudes)

are changing the way companies

think about their hiring needs.

Technology, economic forces, changing

expectations and globalization have all

contributed to shifts in where workers are

found and how they want to work. As a result,

companies are now looking more at the total

“talent supply chain” than at individual labor

silos. They are favoring a blended approach

to filling varied positions, which is not

facilitated by these HR-procurement silos.

Companies are increasingly looking to

streamline vendor management to save

money and create greater efficiencies. HR

is becoming more involved in Managed

Service Provider (MSP) programs that started

in procurement, leading to the concept of

having one sponsor to manage hiring needs

of all kinds. On top of this, companies’ RPO

needs have changed and they are now using

them not only for hard-to-fill positions, but for

semi-skilled and customer service positions

as well. What they need is an effective overall

process for attracting talent, not just a one-off

solution per position.

RPO providers and MSPs recognize this

shift, evidenced by the surge in mergers,

acquisitions and partnerships in the past year.

NelsonHallSeniorHROutsourcinganalyst

Gary Bragar explains, “As companies remain

cautious due to continued low consumer

confidence and ongoing market uncertainty,

they are hiring more temporary employees

and utilizing more contingent workforces

than on-boarding new full-time hires.”

[NelsonHall’sHROInsightsblog]

The trend of mergers and acquisitions

within the RPO space is likely to continue as

hiring is predicted to remain flat, and fierce

competition for talent persists.

RPO providers need to think in terms of a complete recruiting solution. For example, do you hire on a permanent or contingent basis? We will see a total workforce solution more and more as clients look at hiring differently. The concepts of permanent and temporary are blurring.”

pam berklich, svp, kellyocg

Page 8: 5 Global Trends in Recruitment Outsourcing

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conclusionDemographics, work preferences and technology are changing rapidly around the world.

To successfully manage the new “talent

supply chain” as this occurs, a greater

partnership between RPO providers and

their clients is needed, and new strategies

must be explored.

These changes necessitate a more holistic

look at what companies truly need, as well

as what job seekers actually want.

As organizations look for ways to create

efficiencies, save money and consolidate

vendor management, a blended approach

to filling all positions is gaining traction.

Recruiting needs and challenges are

multiplying across a diverse global

spectrum, and organizations are seeking

partners in their overall talent strategy.

They’re seeking ways to come to terms

with the candidate-as-customer reality, and

with the need to faithfully represent their

company branding across every aspect of

the employment proposition.

The lines between permanent and

temporary and between RPO providers and

MSPs are blurring as HR and procurement

align strategically to address the total

workforce needs.

Ultimately, organizations need one big pot

of global hiring solutions, and they’re seeking

the simplest, most cost-effective way of

accessing it. The test of both MSPs and

RPO providers from here on in is just how

well they can deliver on this need.

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eXiT

about kellyocg

KellyOCG® is the Outsourcing and Consulting Group of Kelly Services, Inc., a leader in providing

workforce solutions. KellyOCG is a global leader in innovative talent management solutions in the

areas of Recruitment Process Outsourcing (RPO), Business Process Outsourcing (BPO), Contingent

Workforce Outsourcing (CWO), including Independent Contractor Solutions, Human Resources

Consulting, Career Transition & Executive Coaching, and Executive Search.

Visit www.kellyocg.com

about the author

D. ZaCHaRy MISKO is Vice President, Workforce Strategy of the Kelly

Outsourcing and Consulting Group (KellyOCG), with 20 years experience

in the HR industry. He works with Fortune 500 companies throughout the

world to develop and implement processes that improve and drive human

resources and workforce solutions. Zachary is a Senior Executive Board

Member of Best Practice Institute (BPI) and serves on the Latin america

Regional advisory Board for the International association of Outsourcing Professionals

(IaOP). He was named one the top 15 Workforce and HR professionals under 40 in

the US by Workforce Management magazine in Oct 2011. In November 2011,

Globalization Today magazine and the IaOP listed Zachary in their annual PowerHouse

25 list—a list of the top 25 outsourcing professionals globally.