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5
global trends
in recruitment
outsourcing
d. zachary misko
Recruitment outlook for 2012/13
The great (global) melting pot



Today, the entire world has become an            Organizations and HR professionals are          Today’s global workforce represents a
employment melting pot. Borders seem to          tasked with adapting to this diverse            complex mixture of shifting demographics
dissolve as organizations seek out talented      landscape, and part of doing so requires        and changing expectations and needs,
individuals to drive innovation and efficiency   a sea change in the way they think about        and because of this the recruitment
at a scale and speed never before seen.          where candidates are, how to connect            outlook for the next year will be defined
                                                 with them, and what candidates are              primarily by the following factors:
Yet, workforces are shrinking in more
                                                 looking for in terms of employment.             •	 Ongoing uncertainty in global
regions than they’re growing, and the rise
                                                                                                   markets requiring a greater focus on
of the knowledge worker and the free             Increasingly, this has required organizations
                                                                                                   contingent labor and maximizing value
agent has already made finding qualified         to reconsider how permanent, temporary and
                                                                                                   from people resources;
workers to fill permanent, full-time roles       contingent labor is purchased and managed.
increasingly difficult. Diminishing supply of    There is no doubt that the complexity (and      •	 Increasing competition for key skilled
                                                                                                   labor in the science, technology,
talent, and the development of technology        the potential for competitive advantage) that
                                                                                                   mathematics and engineering fields
that can facilitate data sharing and high        workforce strategies now embody is putting
                                                                                                   where growth is strong;
quality collaboration, has led to the            Recruitment Process Outsourcing (RPO)
emergence of a truly global workforce.           providers on more organizations’ radars.        •	 Greater focus on the efficiency of hiring
                                                                                                   decisions and the management of
                                                                                                   the talent pipeline.




                                                                                                                                                2
trend #1 / Targeting new sources of talent




The trend of reducing workforces has            The overwhelming factor that slows or stalls        just 23% in the EMEA (Europe, Middle East,
spread far and wide. More people are            the recruitment process is “quality of hires”.      Africa) region. So, talent appears to only be   Organizations are innovating
now leaving the workforce than entering         And this is a problem that is almost universal.     becoming scarcer in the key growth regions.     the use of RPO solutions, and
it, and there are few countries with skilled    However, it is a major concern in the Asia-                                                         using them to solve specific
                                                                                                    The need to target new sources of talent,
workforces that can counter this trend.         Pacific region, where 67% of recruiters report                                                      business needs.”
                                                that they are having difficulty filling positions   including retirees, free agents, as well as

After all, it’s not just a shortage of people   with qualified workers. Almost one-in-four          employees in emerging markets, is becoming      Just 17% of companies use
we’re talking about here, it’s a shortage       organizations (39%) in the region say they          a key issue for organizations.                  RPO end-to-end, as their
of talent that the world labor market must      plan to hire 100 or more employees this year,                                                       entire recruiting function;
contend with.                                   compared with 30% in the Americas, and                                                              60% use RPO selectively, for
                                                                                                                                                    some elements of the process
                                                                                                                                                    or for particular hard-to-fill
reasons for problems in hiring                                                                                                                      roles and projects.
 Shortage of skilled staff / 79%                                                                                                                    Aberdeen Group,
                                                                                                                                                    “RPO 2011: Rethink Recruitment”

 Salary uncompetitive / 42%


 Location / 33%


 Current recruitment process / 33%


HROA/Kelly OCG’s 2011 Global RPO Report




                                                                                                                                                                                      3
trend #2 / Matching the job to the person,
not the person to the job



Until recently, a request for hire went out     Traditional methods such as cold calling           As such, the differentiator among RPO
and HR determined whether the position          and in-person networking, print and brand          providers will be how well they work with       It is estimated that
should be full-time or contract. Now, a new     recognition/attraction, as well as social          clients to create opportunities that meet the
                                                                                                                                                   worldwide, the RPO
paradigm has emerged. Instead of simply         media, blogs, microblogs, meet-ups and             company’s needs, and candidate preferences.
determining the opportunity and seeking         more are all important components in both                                                          market will more than
the right person to fill it, the right person                                                      For example, workers are increasingly
                                                the recruiter’s and the job seeker’s strategies.                                                   double by 2015, reaching
now helps to shape the opportunity.                                                                interested in free agent options such as
                                                An integrated approach using all the               microwork, independent contracting,             nearly $4.4 billion.
The new paradigm asks, “Where is the talent     available tools to find and engage candidates      temporary and project work, and                 NelsonHall “Targeting RPO” report
that matches the need, and how does that        where they live, work and play is bringing         entrepreneurship. The global free agent
person want to be employed?”                    sourcing to a new level.                           population accounts for at least 20–30%
                                                                                                   of the entire workforce—44% in the U.S.—
The candidate—the ultimate client—has           The problem is that HR departments are             and growing. In the 20–30 year-old age
had a shift of mindset, and recruiters must     already overwhelmed by other demands               demographic, average tenure on a job is
go beyond static job postings, phone calls      and this kind of highly targeted approach          one year, whereas a contingent contract is
and networking to find top talent. They must    is more than many can commit to. Instead,          typically a year and a half.
more effectively match the opportunity to       many are looking to Recruitment Process
the person, and this means knowing where        Outsourcing (RPO) to help them achieve the         Tenure and stability are no longer the
to look for the person, as well as how to       desired integrated approach.                       primary considerations for candidates—and
structure the opportunity.                                                                         employment opportunities must reflect this.




                                                                                                                                                                                       4
Trend #3 / Recruitment outsourcer as
strategic partner and brand ambassador



The complexity of recruitment for many        can identify inefficiencies and help create        strategies say another thing to job applicants,
global companies today stretches              better processes, standardize processes            the broken promise could significantly impact     Employer branding
the resources and technology of in-house      across locations, scale up or down as              the ability to attract and acquire top talent.
                                                                                                                                                   is a top-five industry
HR departments.                               needed, and track important metrics, like
                                              quality of hires. The latter involves long-term
                                                                                                 A strong employment brand can provide             game-changer.
Increasingly, companies need dedicated                                                           an important competitive advantage, and
                                              measurement of factors like performance                                                              HRO Today’s 2011 Summit, Europe
infrastructure and expertise to find and                                                         providers who reflect the brand can be a
                                              scores, engagement, promotion and
secure scarce talent in multiple employment                                                      true competitive differentiator. Most RPO
                                              turnover—and all of these factors are linked
markets. Yet, if they outsource their                                                            providers now offer employment branding
                                              to the talent acquisition strategy.
recruitment they need consistency and                                                            services, but organizations need to consider

genuine stewardship of their brand.           Because the candidate is now, more than            more than just corporate messaging. Their
                                              ever, in the driver’s seat, the candidate          processes, people and technology must
As RPO continues to gain traction             experience is key to an employer’s brand. If       facilitate a positive, satisfying experience
worldwide, buyers are beginning to see        an employer’s brand says one thing to the          that is on-brand.
ways to create added value. Providers         public, yet its talent acquisition and retention




                                                                                                                                                                                     5
Trend #4 / The multi-country approach




Globalization brings with it the need for     The hallmarks of a provider with global            and the EMEA region ranks highest for
global recruiting solutions. In industries    capabilities include:                              average number of countries covered.                 Nearly half of
where skills are highly transferable,
                                              •	 access to a global pool of quality talent;    •	 Buyers include EMEA nearly as frequently            multi-country RPO buyers
borders count for little as recruiters seek                                                      as they include North American multi-
talent wherever it may be found.
                                              •	 the ability to deliver talent in light of                                                            cover four or more
                                                                                                 country RPO deals.
                                                 differing customs, cultures and languages;                                                           countries of operation.
Increasingly, companies are taking a             and                                           •	 Buyers frequently include some of the
                                                                                                                                                      Everest Group
multi-country approach to accessing talent.                                                      emerging economies such as India,                    “2011 Multi-Country Recruitment
                                              •	 a global footprint or regional offices that
                                                                                                 China, Brazil, and Russia in multi-country           Process Outsourcing: Hype vs. Reality”.
Primarily, they are seeking standardized
                                                 provide deep regional knowledge.
and streamlined processes, scalability and                                                       RPO deals.
                                              Single-country RPO still exists in far greater
reduction in cost—while shoring up supply.                                                     •	 The origin of multi-country RPO deals
                                              volume than multi-country RPO. However:
More often, this is requiring some form                                                          is more broad-based now, with nearly
of RPO with a provider that offers a truly    •	 Nearly half of multi-country RPO buyers         half of such deals originating outside of
global solution.                                 cover four or more countries of operation,      North America.

                                                                                                                        From Everest Group’s 2011
                                                                                                                   Multi-country recruitment report




                                                                                                                                                                                                6
trend #5 / Total workforce solutions




Traditionally, HR recommended and                Companies are increasingly looking to               RPO providers and MSPs recognize this
ultimately purchased RPO while                   streamline vendor management to save                shift, evidenced by the surge in mergers,         RPO providers need
procurement purchased temporary                  money and create greater efficiencies. HR           acquisitions and partnerships in the past year.   to think in terms of a
and contingent labor. But, changes in            is becoming more involved in Managed                NelsonHall Senior HR Outsourcing analyst          complete recruiting
workforce demographics (and attitudes)           Service Provider (MSP) programs that started        Gary Bragar explains, “As companies remain        solution. For example, do
are changing the way companies                   in procurement, leading to the concept of           cautious due to continued low consumer            you hire on a permanent
think about their hiring needs.                  having one sponsor to manage hiring needs           confidence and ongoing market uncertainty,        or contingent basis? We
                                                 of all kinds. On top of this, companies’ RPO        they are hiring more temporary employees          will see a total workforce
Technology, economic forces, changing            needs have changed and they are now using           and utilizing more contingent workforces          solution more and more
expectations and globalization have all          them not only for hard-to-fill positions, but for   than on-boarding new full-time hires.”            as clients look at hiring
contributed to shifts in where workers are       semi-skilled and customer service positions         [NelsonHall’s HRO Insights blog]                  differently. The concepts
found and how they want to work. As a result,    as well. What they need is an effective overall                                                       of permanent and
companies are now looking more at the total                                                          The trend of mergers and acquisitions
                                                 process for attracting talent, not just a one-off                                                     temporary are blurring.”
“talent supply chain” than at individual labor   solution per position.                              within the RPO space is likely to continue as
silos. They are favoring a blended approach                                                          hiring is predicted to remain flat, and fierce    Pam Berklich, SVP, KellyOCG

to filling varied positions, which is not                                                            competition for talent persists.
facilitated by these HR-procurement silos.




                                                                                                                                                                                     7
CONCLUSION
Demographics, work preferences and technology are changing rapidly around the world.




To successfully manage the new “talent        vendor management, a blended approach           The lines between permanent and
supply chain” as this occurs, a greater       to filling all positions is gaining traction.   temporary and between RPO providers and
partnership between RPO providers and         Recruiting needs and challenges are             MSPs are blurring as HR and procurement
their clients is needed, and new strategies   multiplying across a diverse global             align strategically to address the total
must be explored.                             spectrum, and organizations are seeking         workforce needs.

                                              partners in their overall talent strategy.
These changes necessitate a more holistic                                                     Ultimately, organizations need one big pot
                                              They’re seeking ways to come to terms           of global hiring solutions, and they’re seeking
look at what companies truly need, as well
                                              with the candidate-as-customer reality, and     the simplest, most cost-effective way of
as what job seekers actually want.
                                              with the need to faithfully represent their     accessing it. The test of both MSPs and
As organizations look for ways to create      company branding across every aspect of         RPO providers from here on in is just how
efficiencies, save money and consolidate      the employment proposition.                     well they can deliver on this need.




                                                                                                                                                8
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.

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




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5 Global Trends in Recruitment Outsourcing

  • 2. Recruitment outlook for 2012/13 The great (global) melting pot Today, the entire world has become an Organizations and HR professionals are Today’s global workforce represents a employment melting pot. Borders seem to tasked with adapting to this diverse complex mixture of shifting demographics dissolve as organizations seek out talented landscape, and part of doing so requires and changing expectations and needs, individuals to drive innovation and efficiency a sea change in the way they think about and because of this the recruitment at a scale and speed never before seen. where candidates are, how to connect outlook for the next year will be defined with them, and what candidates are primarily by the following factors: Yet, workforces are shrinking in more looking for in terms of employment. • Ongoing uncertainty in global regions than they’re growing, and the rise markets requiring a greater focus on of the knowledge worker and the free Increasingly, this has required organizations contingent labor and maximizing value agent has already made finding qualified to reconsider how permanent, temporary and from people resources; workers to fill permanent, full-time roles contingent labor is purchased and managed. increasingly difficult. Diminishing supply of There is no doubt that the complexity (and • Increasing competition for key skilled labor in the science, technology, talent, and the development of technology the potential for competitive advantage) that mathematics and engineering fields that can facilitate data sharing and high workforce strategies now embody is putting where growth is strong; quality collaboration, has led to the Recruitment Process Outsourcing (RPO) emergence of a truly global workforce. providers on more organizations’ radars. • Greater focus on the efficiency of hiring decisions and the management of the talent pipeline. 2
  • 3. trend #1 / Targeting new sources of talent The trend of reducing workforces has The overwhelming factor that slows or stalls just 23% in the EMEA (Europe, Middle East, spread far and wide. More people are the recruitment process is “quality of hires”. Africa) region. So, talent appears to only be Organizations are innovating now leaving the workforce than entering And this is a problem that is almost universal. becoming scarcer in the key growth regions. the use of RPO solutions, and it, and there are few countries with skilled However, it is a major concern in the Asia- using them to solve specific The need to target new sources of talent, workforces that can counter this trend. Pacific region, where 67% of recruiters report business needs.” that they are having difficulty filling positions including retirees, free agents, as well as After all, it’s not just a shortage of people with qualified workers. Almost one-in-four employees in emerging markets, is becoming Just 17% of companies use we’re talking about here, it’s a shortage organizations (39%) in the region say they a key issue for organizations. RPO end-to-end, as their of talent that the world labor market must plan to hire 100 or more employees this year, entire recruiting function; contend with. compared with 30% in the Americas, and 60% use RPO selectively, for some elements of the process or for particular hard-to-fill reasons for problems in hiring roles and projects. Shortage of skilled staff / 79% Aberdeen Group, “RPO 2011: Rethink Recruitment” Salary uncompetitive / 42% Location / 33% Current recruitment process / 33% HROA/Kelly OCG’s 2011 Global RPO Report 3
  • 4. trend #2 / Matching the job to the person, not the person to the job Until recently, a request for hire went out Traditional methods such as cold calling As such, the differentiator among RPO and HR determined whether the position and in-person networking, print and brand providers will be how well they work with It is estimated that should be full-time or contract. Now, a new recognition/attraction, as well as social clients to create opportunities that meet the worldwide, the RPO paradigm has emerged. Instead of simply media, blogs, microblogs, meet-ups and company’s needs, and candidate preferences. determining the opportunity and seeking more are all important components in both market will more than the right person to fill it, the right person For example, workers are increasingly the recruiter’s and the job seeker’s strategies. double by 2015, reaching now helps to shape the opportunity. interested in free agent options such as An integrated approach using all the microwork, independent contracting, nearly $4.4 billion. The new paradigm asks, “Where is the talent available tools to find and engage candidates temporary and project work, and NelsonHall “Targeting RPO” report that matches the need, and how does that where they live, work and play is bringing entrepreneurship. The global free agent person want to be employed?” sourcing to a new level. population accounts for at least 20–30% of the entire workforce—44% in the U.S.— The candidate—the ultimate client—has The problem is that HR departments are and growing. In the 20–30 year-old age had a shift of mindset, and recruiters must already overwhelmed by other demands demographic, average tenure on a job is go beyond static job postings, phone calls and this kind of highly targeted approach one year, whereas a contingent contract is and networking to find top talent. They must is more than many can commit to. Instead, typically a year and a half. more effectively match the opportunity to many are looking to Recruitment Process the person, and this means knowing where Outsourcing (RPO) to help them achieve the Tenure and stability are no longer the to look for the person, as well as how to desired integrated approach. primary considerations for candidates—and structure the opportunity. employment opportunities must reflect this. 4
  • 5. Trend #3 / Recruitment outsourcer as strategic partner and brand ambassador The complexity of recruitment for many can identify inefficiencies and help create strategies say another thing to job applicants, global companies today stretches better processes, standardize processes the broken promise could significantly impact Employer branding the resources and technology of in-house across locations, scale up or down as the ability to attract and acquire top talent. is a top-five industry HR departments. needed, and track important metrics, like quality of hires. The latter involves long-term A strong employment brand can provide game-changer. Increasingly, companies need dedicated an important competitive advantage, and measurement of factors like performance HRO Today’s 2011 Summit, Europe infrastructure and expertise to find and providers who reflect the brand can be a scores, engagement, promotion and secure scarce talent in multiple employment true competitive differentiator. Most RPO turnover—and all of these factors are linked markets. Yet, if they outsource their providers now offer employment branding to the talent acquisition strategy. recruitment they need consistency and services, but organizations need to consider genuine stewardship of their brand. Because the candidate is now, more than more than just corporate messaging. Their ever, in the driver’s seat, the candidate processes, people and technology must As RPO continues to gain traction experience is key to an employer’s brand. If facilitate a positive, satisfying experience worldwide, buyers are beginning to see an employer’s brand says one thing to the that is on-brand. ways to create added value. Providers public, yet its talent acquisition and retention 5
  • 6. Trend #4 / The multi-country approach Globalization brings with it the need for The hallmarks of a provider with global and the EMEA region ranks highest for global recruiting solutions. In industries capabilities include: average number of countries covered. Nearly half of where skills are highly transferable, • access to a global pool of quality talent; • Buyers include EMEA nearly as frequently multi-country RPO buyers borders count for little as recruiters seek as they include North American multi- talent wherever it may be found. • the ability to deliver talent in light of cover four or more country RPO deals. differing customs, cultures and languages; countries of operation. Increasingly, companies are taking a and • Buyers frequently include some of the Everest Group multi-country approach to accessing talent. emerging economies such as India, “2011 Multi-Country Recruitment • a global footprint or regional offices that China, Brazil, and Russia in multi-country Process Outsourcing: Hype vs. Reality”. Primarily, they are seeking standardized provide deep regional knowledge. and streamlined processes, scalability and RPO deals. Single-country RPO still exists in far greater reduction in cost—while shoring up supply. • The origin of multi-country RPO deals volume than multi-country RPO. However: More often, this is requiring some form is more broad-based now, with nearly of RPO with a provider that offers a truly • Nearly half of multi-country RPO buyers half of such deals originating outside of global solution. cover four or more countries of operation, North America. From Everest Group’s 2011 Multi-country recruitment report 6
  • 7. trend #5 / Total workforce solutions Traditionally, HR recommended and Companies are increasingly looking to RPO providers and MSPs recognize this ultimately purchased RPO while streamline vendor management to save shift, evidenced by the surge in mergers, RPO providers need procurement purchased temporary money and create greater efficiencies. HR acquisitions and partnerships in the past year. to think in terms of a and contingent labor. But, changes in is becoming more involved in Managed NelsonHall Senior HR Outsourcing analyst complete recruiting workforce demographics (and attitudes) Service Provider (MSP) programs that started Gary Bragar explains, “As companies remain solution. For example, do are changing the way companies in procurement, leading to the concept of cautious due to continued low consumer you hire on a permanent think about their hiring needs. having one sponsor to manage hiring needs confidence and ongoing market uncertainty, or contingent basis? We of all kinds. On top of this, companies’ RPO they are hiring more temporary employees will see a total workforce Technology, economic forces, changing needs have changed and they are now using and utilizing more contingent workforces solution more and more expectations and globalization have all them not only for hard-to-fill positions, but for than on-boarding new full-time hires.” as clients look at hiring contributed to shifts in where workers are semi-skilled and customer service positions [NelsonHall’s HRO Insights blog] differently. The concepts found and how they want to work. As a result, as well. What they need is an effective overall of permanent and companies are now looking more at the total The trend of mergers and acquisitions process for attracting talent, not just a one-off temporary are blurring.” “talent supply chain” than at individual labor solution per position. within the RPO space is likely to continue as silos. They are favoring a blended approach hiring is predicted to remain flat, and fierce Pam Berklich, SVP, KellyOCG to filling varied positions, which is not competition for talent persists. facilitated by these HR-procurement silos. 7
  • 8. CONCLUSION Demographics, work preferences and technology are changing rapidly around the world. To successfully manage the new “talent vendor management, a blended approach The lines between permanent and supply chain” as this occurs, a greater to filling all positions is gaining traction. temporary and between RPO providers and partnership between RPO providers and Recruiting needs and challenges are MSPs are blurring as HR and procurement their clients is needed, and new strategies multiplying across a diverse global align strategically to address the total must be explored. spectrum, and organizations are seeking workforce needs. partners in their overall talent strategy. These changes necessitate a more holistic Ultimately, organizations need one big pot They’re seeking ways to come to terms of global hiring solutions, and they’re seeking look at what companies truly need, as well with the candidate-as-customer reality, and the simplest, most cost-effective way of as what job seekers actually want. with the need to faithfully represent their accessing it. The test of both MSPs and As organizations look for ways to create company branding across every aspect of RPO providers from here on in is just how efficiencies, save money and consolidate the employment proposition. well they can deliver on this need. 8
  • 9. 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. 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 EXIT