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Talent Corner HR Services Pvt. Ltd.

THAKUR INSTITUTE OF MANAGEMENT STUDIES & RESEARCH


Prsented by Safakat Ibrahim Agashiwala(PGDM 2008-2010)
1






Talent Corner HR Services Pvt. Ltd.


THAKUR INSTITUTE OF MANAGEMENT STUDIES & RESEARCH
Prsented by Safakat Ibrahim Agashiwala(PGDM 2008-2010)
2



Summer Project Report on
Scope of Recruitment Process Outsourcing


Submited to
Bankim Doshi
(Director)(Guide)
Talent Corner HR Services Pvt. Ltd.

Submited by
Safakat Ibrahim agashiwala
Agashi Bhandarwada, virar(W) Thane-401301
PGDM(A)(2008-2010)
Roll.no. 04
H.R

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Index
Sr.no Particulars Page no.
1 Executive Summary 4
2 Objective of study 5
3 Recruitment process outsourcing an overview 6-9
4 Outsourcing process flowchart 10
5 Critical requirement 11
6 Factors to be consider before selecting a
recruitment consultant
12-13
7 Types of rpo 14
8 Benefits of rpo 15-16
9 Technique use by rpo for recruitment 17
10 Core and non-core activities of corporate hr 18
11 Choice of outsourcing model 19
12 Understanding recruitment process 20
13 The recruitment process lifecycle 21-22
14 Advantages of rpo 23
15 The roi of rpo: recruitment expertise 24-25
16 Rpo process model 26
17 The big 3 efficiency metrics in recruitment 27-28
18 Conclusion 29
19 Acknowledgement 30
20 Bibliography 31



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Executive Summary
Outsourcing the human resource (HR) processes is the latest practice being followed by middle
and large sized organizations. It is being witnessed across all the industries. In India, the HR
processes are being outsourced from nearly a decade now. Outsourcing industry is growing at a
high rate.

Human Resource Outsourcing refers to the process in which an organisation uses the expert
services of a third party (generally professional consultants) to take care of its HR functions
while HR management can focus on the strategic dimension of their function. The functions that
are typically outsourced are the functions that need expertise, relevant experience, knowledge
and best methods and practices. This has given rise to outsourcing the various HR functions of
an organization.
Recruitment Process Outsourcing (or RPO) to India is characterized by identifying those
expertise that are not inherent to the core of the client organization, i.e dividing the process of
recruitment into core and non-core HR activities.
The non-core recruitment processes such as database searching, job advertisements, head hunt
research, internet mining, etc. involve 50 - 60% of the recruiters time, energies and costs.
Outsourcing the non-core recruitment process creates additional efficiencies, while
simultaneously allowing for a focus on building relationships with candidates and clients.
Recruiters, thus, are able to focus better on core recruitment functions and work on important
hiring strategies that create profitable growth and sustain business success.

For reasons of having no time and resources to manage human resource functions, companies
usually resort to HR outsourcing. It is a cost-effective way of managing human resource
functions without having to resort to employing personnel for an in-house HR staff.

There are a lot of benefits that businesses can gain from outsourcing HR tasks. One of the most
appealing benefits is the ability of a company to focus on their core business activities while still
having effective HR policies.


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Objective Of Study
The objective of project was to identify the benefits of outsourcing recruitment and
understanding the recruitment process.

The Project contains details about the various criteria of outsourcing recruitment.

The project highlights the reasons why companies indulge in outsourcing recruitment and the
merits and advantages of outsourcing recruitment to direct hiring.

It also enumerate various factors to be considered before outsourcing recruitment.
.
Identify the various practices of recruitment existing in the industry. The project should
have a detailed understanding of the methods adopted by recruitment agencies to make
the hiring process quicker.










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RECRUITMENT PROCESS OUTSOURCING an
overview
Meaning.
Recruitment Process Outsourcing (RPO) is a form of business process outsourcing (BPO) where
an employer outsources or transfers all or part of its recruitment activities to an external service
provider.
To quote the Recruitment Process Outsourcing Association, "Recruitment Process Outsourcing is
when a provider acts as a company's internal recruitment function for a portion or all of its jobs. RPO
providers manage the entire recruiting/hiring process from job profiling through the on-boarding of the
new hire, including staff, technology, method and reporting. A properly managed RPO will improve a
company's time to hire, increase the quality of the candidate pool, provide verifiable metrics, reduce
cost and improve governmental compliance."
The RPO Alliance, a group of the Human Resources Outsourcing Association (HROA), approved this
definition in February 2009: "Recruitment Process Outsourcing (RPO) is a form of business process
outsourcing (BPO) where an employer transfers all or part of its recruitment processes to an external
service provider. An RPO provider can provide its own or may assume the company's staff,
technology, methodologies and reporting. In all cases, RPO differs greatly from providers such as
staffing companies and contingent/retained search providers in that it assumes ownership of the design
and management of the recruitment process and the responsibility of results."
On the other hand, occasional recruitment support, for example temporary, contingency and executive
search services is more analogous to out-tasking, co-sourcing or just sourcing. In this example the
service provider is "a" source for certain types of recruitment activity. The biggest distinction between
RPO and other types of staffing is Process. In RPO the service provider assumes ownership of the
process, while in other types of staffing the service provider is part of a process controlled by the
organization buying their services.
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History.
While temporary, contingency and executive search firms have provided staffing services for many
decades, the concept of an employer outsourcing the management and ownership of part or all of their
recruiting process wasn't first realized on a consistent basis until the 1970s in Silicon Valley's highly
competitive high tech labor market. Fast-growing high tech companies were hard-pressed to locate and
hire the technical specialists they required, and so had little choice but to pay large fees to highly
specialized external recruiters in order to staff their projects. Over time, companies began to examine
how they might reduce the growing expenses of recruitment fees while still hiring hard-to-find
technical specialists. Toward this end, companies began to examine the various steps in the recruiting
process with an eye toward outsourcing only those portions that they had the greatest difficulty with
and that added the greatest value to them. Initial RPO programs typically consisted of companies
purchasing lists of potential candidates from RPO vendors. This "search/research" function, as it was
called, generated names of competitors' employees for a company and served to augment the pool of
potential candidates from which that company could hire.
Over time, as business in general embraced the concept of outsourcing more and more, RPO gained
favor among Human Resource management: not only did RPO reduce overhead costs from their
budgets but it also helped improve the company's competitive advantage in the labor market. As labor
markets became more and more competitive, RPO became more of an acceptable option. Furthermore,
through the advent in the 1980's and 1990's of human resources outsourcing (HRO) companies that
began taking on the processes associated with benefits, taxes, and payroll, companies began
recognizing that recruiting--a significant cost of HR--should also be considered for outsourcing. In the
early 2000's more companies began considering the outsourcing of recruitment for major portions of
their recruiting need.
There have been fundamental changes in the US labor market that serve to reinforce the use of RPO as
well. The labor market has become increasingly dynamic: workers today change employers more often
than in previous generations. De-regulated labor markets have also created a shift towards contract and
part-time labor and shorter work tenures. These trends increase recruitment activity and may
encourage the use of RPO. It should also be noted that even in slower economic times or higher
unemployment, RPO is still considered by companies to assist in an increasing need to screen through
a larger candidate pool.

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Benefits.
RPO's promoters claim that the solution offers improvement in quality, cost, service and speed.
RPO providers claim that leveraging economies of scale enables them to offer recruitment processes
at lower cost while economies of scope allow them to operate as high-quality specialists. Those
economies of scale and scope arise from a larger staff of recruiters, databases of candidate resumes,
and investment in recruitment tools and networks.
RPO solutions are also claimed to change fixed investment costs into variable costs that vary with
fluctuation in recruitment activity. Companies may pay by transaction rather than by staff member,
thus avoiding under-utilization or forcing costly layoffs of recruitment staff when activity is low.














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Problems.
If a company failed to define its overall recruitment strategy and hiring objectives, then any recruiting
program may fail to meet the company's needs. This is especially true for outsourced programs like
RPO: RPO can only succeed in the context of a well-defined corporate and staffing strategy.
As with any program, a company must manage its RPO activities. A company must provide initial
direction and continued monitoring to assure the desired results. Overall, providing guidance to
external activities can present a significant management challenge. Outsourcing of company processes
may fail or prove a poor organizational fit. Improperly implemented RPO could reduce the
effectiveness of recruitment.
The costs charged for outsourced recruitment transactions may total more than the cost of the internal
recruitment department.
RPO service providers may fail to provide the quality or volume of staff required by their customers.
Placing all recruitment in the hands of a single outside provider may discourage the competition that
would arise if multiple recruitment agencies were used.
An RPO solution may not work if the company's existing recruitment processes are performing poorly.
An RPO solution may not work if the service provider has inadequate recruitment processes or
procedures to work with the client.
RPO may not resolve difficulties that organizations have hiring staff when the organization is
perceived negatively by potential employees. This will instead require improved branding and an
adjustment of image. The perception is that very few RPOs can successfully integrate their client's
brand and therefore do not represent their client's brand as well as a retained search or internal
recruiting resource may drive brand representation and or marketing.
Further, most RPOs perform their staffing functions and service offsite, further disconnecting the
client's growth & recruiting strategy from the actual workforce within the client company. This is
important because during a period of rapid recruitment growth, one of the many positive effects that a
company typically enjoys is an increase in the workforce wellness or an overall workforce positivity of
sentiment of optimism that comes with personnel additions... this may be lessened with an offsite
recruiting function. Organizations with efficient hiring process that are viewed as employers of choice
by potential staff may stand to gain negligible benefits from RPO.
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Outsourcing Process Flow Chart

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CRITICAL REQUIREMENTS

For any managed services model to work there are some critical requirements or must haves like

A. Executive sponsorship of the project. Any business model innovation requires the executive
to champion internal resistance into acceptance.

B. Clear Partnership Definition - A detailed and clear scope of work to be defined before
agreeing on to the terms. The managed services agreement will have the scope of work
documented & agreed upon.
C. Clarity on the role & the deliverables from the onsite resource & the same to be documented
& mutually agreed upon.
D. Mutually agreed expectations to be jotted in the agreement. Prepare a project plan with
defined recruitment process & get a consensus on the same.
E. Historical data to be made available so as to help prepare a project plan blocking all possible
loop holes and deciding on the key deliverables.
F. Its imperative for the success of this arrangement that we have a buy in from each person
involved in the project from Clients side and everyone understand that the intention is to meet
the numbers and nothing else.








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Factors to be consider before selecting a
Recruitment Consultant

If an organisation decides to outsource its recruitment processes or activities, it is very
important to find and select a suitable recruitment consultant or consultancies, which can
deliver results according to the needs of the organisation. Today, there are thousands of
consulting firms (consultancies) as well as freelance consultants working independently.
An organisation looks for various considerations and qualities before selecting the suitable
recruitment consultant.
The reputation of the consulting firm in the job market (based on expertise and
experience).
Who are the consultants or firms past and present clients?

Consultants expertise and experience (from how long has he/firm been in the business)
Does the recruitment consultant have the requisite resources to complete the targets on
time?
Get the idea of the effectiveness and the services of the recruitment consultant from its
current and past clients.






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Qualities of an independent recruitment consultant:
Some of the qualities or characteristics looked in recruitment consultants are:
Marketing skills
Flexibility and adaptability
Wisdom
Exuberance
Ability to prioritise
Ambition
Resourcefulness
Diplomacy/ delicacy
Selecting the right recruitment consultant is essential for the effective recruitment processes.
A successful Recruitment consultant is someone who is determinative, focused, and able to
create opportunities for him, works harder and smarter than competitors and continually set
and achieve higher standards.








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Types of RPO
Enterprise Solutions.
Or End to End Recruitment Process Outsourcing
This solution entails the recruitment process outsourcer assuming total responsibility of the
recruitment effort or the entire continuum.
The assumption may include all recruitment for all positions or it may include a segment or
segments of employment. For example, a company may outsource the entire continuum for
all sales positions but retain all other hiring. People Science believes the most effective
partnerships begin first with the assumption of a segment of employment.
Augmenting Solutions.
Augmenting RPO partners fill the gap of proficiency where an organization is lacking. These
services are wide ranging and providers typically fill a combination of areas such as resume
search and initial pre-screens and first round interviews.
Project RPO.
Project Recruitment Process Outsourcing occurs when an organization has a pressing need to
meet a substantial headcount increase and typically within a time constraint. Project RPO can
include augmentation or end to end services and typically has an expected end date of
services. Examples would include the opening of a new call center or the need to increase
headcount that is expected to stabilize.
Provider Specific RPO.
Provider Specific RPO involves utilizing a supplier who provides a single specific expertise.
Although the provider may be limited in scope of service, processing is a critical component
of their services and essential to effective completion of the continuum. Examples of
Provider Specific RPO work are outsourcing resume search or background checks.

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BENEFITS OF RPO


Traditional recruiting methods can be expensive and are often
unproductive and unpredictable.

Whether you employ your own internal recruiters or utilize the services of staffing
agencies, most companies, at the expense of large commissions or placement fees,
do not obtain the results they expect from their recruiting function.
RPO Services eliminate the aforementioned inconsistencies by offering a simple,
effective, and alternative solution to recruiting needs.

Reduced Recruiter Costs.

Spend approximately $25,000 (including $100 commissions/placement) for an
experienced, dedicate recruiter VS. $50,000 + commissions, payroll costs,
medical and dental insurance, administrative costs, and paid vacation (which can
add up to more than $65,000) for an internal recruiter. The decision to utilize
external recruiters is obvious Save more than 60% on Recruiter costs by
utilizing RPO services and enjoy numerous other benefits that will help the
companys to grow.

No Infrastructure Costs.

Utilizing external recruiters allows to free up capital that can be better allocated
towards higher valued consulting activities. The RPO has their own state of the art
offices which are equipped with everything a recruiter would need to perform his/her
daily duties meaning a company dont have to pay a single rupee towards providing
a comfortable working environment for there own recruiters. RPO provide
workstations, computers, static-free phone lines, and a fast DSL connection at no
additional cost.







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Improved Productivity.

Recruiters in India are highly technical and have tremendous experience and
Knowledge. (some of the Recruiters even have MBAs degree) and are able to deliver
many qualified resumes on a weekly basis. They can be trained to follow the exact
recruiting methodology of client and have the ability to match talented professionals
as per the requirement of companies. And because the price of 1 internal recruiter is
equivalent to 2-3 external recruiters, companies can afford to hire more recruiters at
the same cost and increase productivity. The Bottom Line: More Recruiters = More
Productivity.


Reduced Time to Hire.

RPOs are specialized in the field of recruiting which allows them to process, screen,
and deliver dedicated and qualified recruiters that reduces companies time to hire
allowing companies to focus on the core components of their business.


Increased Flexibility and Control.

RPO services allow companies to free up human and capital resources that can be
better spent on core competencies. RPO services provide companies with flexibility,
control, and visibility over their entire recruiting function by removing their
dependence on 3rd party staffing agencies, who are often unreliable, unpredictable,
and expensive.


Securing the best talent.

Competition for the most talented individuals is increasing. Organisations need to
secure the best people quickly and efficiently to help them build competitive
capability.





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Techniques use by RPO for recruitment.
Online Candidate Sourcing.
Online candidate sourcing helps RPO for resume generation using the internet. From using
Job Board/CV databases, Google, advanced search engine usage techniques, filetype
searches to searching blogs, and other business networking sites.
Advertising Posting.

RPO can post the advertisement in the leading newspaper about the vacancies of different
companies to attract the right talent as per the requirement.. The cost of the advertisement
can be share as per the agreement between the company and RPO. RPO should know how to
write a Job Advert copy and manipulate keywords to attract candidates who could otherwise
be heading towards competition.
Networking.

RPO can get the best out of social networking sites like LinkenIn, Orkut, and FaceBook.
Networking provides "never seen before" searching techniques and keys to unlock "hard to
find" candidates. RPO should know how to write compelling emails and letters to engage
cold candidates located on these sites, to convert them into hot prospects.
Communication.

Improved communication levels will help RPO to stand out from the crowd. By applying
world-class communication techniques in everything from emails, letters, job adverts to blog
posts will help the RPO to gain edge over its competitor.




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Core and Non-Core activities of Corporate HR
The corporate HR organisations can outsource almost all of the non core recruiting
functions of the HR and leave only the core tasks of the organisations to their HR and
Recruitment team.
These recruiters will play an important role in the cycle of recruitment and by making the
process less complicated, while the HR can function on core activities like interviewing
candidates, paperwork, instructing the candidates, completing the joining formalities and
others. The focus on these tasks adds a great deal of efficiency to the work being done.

Below is a chart that describes the benefits of working with RPO:




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choice of outsourcing model




Full Outsourcing
Activities initiated in a recruitment process from day one i.e. understanding the requirement
until closing down the position, all comes under the Full Outsourcing model. This model of
outsourcing comprises of not only non-core but also core recruitment activities that are
communication based and are effective for critical recruitment.
Partial Outsourcing
Apart from the core recruitment activities, all other non-core activities such as understanding
the requirement, placing the position on various job boards, searching and researching
candidates, sorting profiles, screening CV and responses, and finally sourcing you with the
list of candidates that are the best match for the position make into partial outsourcing
process. These are precisely the activities that RPOs are most preferred.
Feature-set comparison between the two outsourcing model:
Partial RPO Full RPO
High client/data security Low client/data security
Partial RPO is about non-core activities
in a recruitment process, which consumes
up to 70% of the time.
Full RPO is about core and non-core
activities in recruitment process.
More monotonous nature of job. More interesting kind of job .
Can produce quick results in a short span
as employees have necessary expertise to
extract the leads in bound timelines.
Involves all the activities till the candidate
is placed in the company, which may end
as a time consuming job.
Employees need a limited period training
to start on the process.
A high-level training is essential to help
employees build better repo with the
candidates.
Low man hour rates. High man hour rates.

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Understanding Recruitment Process
Recruitment Process, by all means, is a systematic process that consumes your time invariably in
nurturing right candidate for right position.
The below chart denotes break-up of requirement process in various sub-processes; quoting
approximate time consumed in each relevant sub-process. It is a complete study of all the core and
non-core activities included in the recruitment process.
Sub Process % of Time
Understanding of the requirement 5%
Placing the job position on respective portals/domain 5%
Sorting the profiles and sending mailers 30%
Screening the responses as per job order 30%
Calling and scheduling 20%
Follow up and closing 10%





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The Recruitment Process Lifecycle.
Understanding requirement specifications.
Experience, technical skillsets, managerial aptitude, flexibility, localization, environmental
ethics, etc are grounds, which companies take into account depending upon the job and nature
of work. Studying these requirements minutely and sourcing candidates is the first ad foremost
job.

Job-Boards database searching and Sourcing.
Job-board database searching is the first active task initiated on receiving the requisition. To get
quality candidates, we have subscribed on major job portals worldwide that serve us with a
large bandwidth of candidates' resumes from all streams. While not restricted to a single
medium, we also source candidates from other channels like networks, agencies, referrals etc.

Screening, Sorting and Mailing.
Candidate screening and assessment is an area that relies on a blend of technology and offshore
recruiter's expertise. We have developed effective processes to present the most prominent
candidates in front of your hiring managers.

Selection.
While the hiring decision remains with the recruiters, we can help to support managers in a
variety of ways to speed the hiring process. We can be involved in the process to call all the
short-listed candidates, schedule their interviews, follow-up with the hiring authorities and
finally close the position by sending offer/rejection mailers.



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Advantages of RPO
1.Top notch Talent Pool.
Competition for the most talented individuals is increasing. Organizations need to secure the best
people quickly and efficiently to help them build competitive capability

2.Cost reduction and removal of workload from the HR Administration.
RPO providers take on the burden of operational recruitment activities, allowing organizations to focus
on core value-creating and strategic activities. By transforming processes, utilizing best practice, and
replacing a fixed cost base with a variable charging structure, RPO can significantly reduce the cost of
recruitment. In regular staffing, you invest in salary, incentives, overheads, infrastructure cost and
more. By outsourcing recruiting functions to Recruiting Junction, all you need to pay is a fixed
monthly retainer fees (which is lesser than the salary of one in-house recruiter) along with a negligible
commission.
3.Better Productivity and Quality.
RPO providers can provide highest quality services. By outsourcing your recruitment process to
Recruiting Junction you get dedicated recruiters for each client, while in regular staffing, one recruiter
handles many clients. In regular staffing the focus is lost, as recruiters serve bigger clients better. RPO
recruiter can provide undivided attention to your all your clients big or small.

4.Reduce operational risks.
Risks come in many forms, and the expert knowledge of an RPO specialist can help organizations
reduce the risks associated with an inability to scale their business operationally to meet changing
demand, and the risks of non-compliance to legislative and regulatory change .




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The ROI of RPO: Recruitment Expertise
The unique expectations and job requirements of the next generation entering the workforce can be
challenging. The younger workers filling the shoes of the retiring. Baby Boomers value work-life
integration, prefer teamwork and expect greater compensation and benefits. Undoubtedly, a new
approach to recruiting is required in order to catch the attention of the talented.
Streamlining the Recruitment Process.
In order to attract the Millennials, the first step your organization needs to accomplish is to develop a
strong image and identity. How do you accomplish this? When you partner with an RPO provider, this
essentially means that they are working to improve the effectiveness of your recruitment process. By
tightening up your process, a fair and consistent image of your organization will be quickly delivered
to potential employees that are applying for a job with your company.
A fast, responsive recruitment process will be an essential component in keeping the tech-savvy,
options-oriented Millennials interested in working for your organization. Organizations that remove
barriers for employees to apply, have a user-friendly application process and respond to applicants in
an expeditious manner will certainly have an edge on the competition. The Internet has meant that
people have many choices when seeking employment, and companies who create the best applicant
experience will ultimately have a competitive advantage in attracting and retaining the best talent.

Offering Best Practices Recommendations.
A top-notch RPO provider should essentially be working as a partner "extension" of your organization
and continuously be offering you best practices recommendations. The provider should be on the look-
out for ways to improve the image of your organization so it is an appealing option for potential
employees.
Is your organization attractive to the young talent entering the workforce? If not, why? How does your
organization stack up to competitors in terms of pay and benefits? Does your organization have a
strong corporate culture? Does your organization empower employees to grow and pursue leadership
opportunities? These are all important decision-making factors for the next generation. A strong RPO
provider can help you improve in these areas - making you undeniably attractive to potential
employees.


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Developing an "Employment Brand."
Companies like Southwest Airlines and Google have actually turned the common talent shortage
problem into a more desirable talent "sorting" problem by using employment branding techniques.
They are known as great places to work with excellent growth and leadership opportunities. As an
expert in recruiting, an RPO provider can also help you by putting together the whole employment
value proposition and sourcing strategy for your organization.
Essentially, your employment brand communicates to potential employees what your organization
represents and what the employment experience is all about. Most employment branding efforts
include elements that gather information on your organization's best practices. By working
intentionally to develop an employment brand, this can actually strengthen your internal corporate
culture as well. The consistent messaging can reinforce corporate values and what it means to be a part
of your organization. A strong culture will certainly help you to attract potential employees and retain
them once they are working for you.
Using Recruitment "Marketing."
As an expert in recruiting, an RPO provider will have knowledge about the latest recruiting trends and
insight into the most effective sourcing channels. They will be able to help you use your employment
brand to develop high-impact, innovative recruitment marketing campaigns to spread the word that
your company is a great place to work.
An RPO provider can augment your current recruiting activities through new methods such as job
fairs, radio programs, social networking sites and innovative direct mail campaigns. These avenues are
also excellent opportunities to promote information about company milestones, new product/service
offerings and your overall competitive edge. The goal of the marketing campaigns is to elevate your
differentiators, grab the attention of the modern Millennials and to specifically distinguish your
organization from the rest of the media storm.
Entering into an RPO relationship is no doubt a big step, but the benefits will certainly far outweigh
any initial start-up challenges. And as the current talent war shows no signs of relenting, RPO is sure
to be one of your best kept weapons. An RPO provider's specialization on recruitment will expose you
to new sourcing techniques and overall help you to attract and retain the best people. RPO is a new
trend, but it is a solution that will certainly make a lasting and positive impact on your organization.

Talent Corner HR Services Pvt. Ltd.


THAKUR INSTITUTE OF MANAGEMENT STUDIES & RESEARCH
Prsented by Safakat Ibrahim Agashiwala(PGDM 2008-2010)
26


RPO Process Model


Recruiting Manager:
Manages and is responsible for overall delivery to client including response rate, interview rate, fill
rate etc.

Recruiting Team Lead:
Reports to Recruiting Manager and monitors progress on each client job order. The Team lead is also
responsible to maintain relationships with candidates in the hiring process and serves as second level
escalation point.

Junior Recruiting teams:
perform backend searches for matching candidates in RPO internal database as well as various job
boards, user groups and networking groups

Senior Recruiting teams:
evaluate and qualify candidates screened by junior recruiting team members. This results in overall
operational efficiency in the recruiting process and yields optimal results in terms of a qualified
candidate in the fastest time.










Talent Corner HR Services Pvt. Ltd.


THAKUR INSTITUTE OF MANAGEMENT STUDIES & RESEARCH
Prsented by Safakat Ibrahim Agashiwala(PGDM 2008-2010)
27




The Big 3 Efficiency Metrics in Recruiting.

Measuring success is critical in recruiting. There are four general types of metrics on which to
concentrate -- cost, quality, quantity, and time. One way we measure "quality" is using the Big 3
Efficiency metrics.
Efficiency is a funny thing. It can mean many different things to different people. For example, the
Laws of Thermodynamics tell us that any engine or machine is doing very well if it is operating at 80%
efficiency, which means that 80% of the energy input is turned into useful work. They also tell us that
NO machine can operate at 100% efficiency.
In recruiting, efficiency measures how well recruiters are doing their job and effectiveness of the
recruiting process.
1. submittal efficiency,
2. interview efficiency, and
3. offer efficiency.
Submittal Efficiency.
The first, submittal efficiency, is a measure of how well the submitted candidates fit against the
requisition profile. It is defined as the number of candidates interviewed divided by the total number of
candidates submitted. You would expect this number to be high. However, as in Thermodynamics, it
can be TOO high. If it is 100%, the recruiter is not pushing the edges of the requisition specifications,
which means you are probably missing good candidates.
However, if your submittal efficiency is too low, it indicates the hiring managers are spending too
much time reviewing resumes. This could be because the recruiter may be doing a poor job, or perhaps
the requisition has been poorly specified. As a whole, hiring managers and recruiters are doing well if
three of every four submittals make it to interviews (75% efficiency). Flashing-red-light warnings
should start to go off if less than one in two (50% efficiency) make it to interviews, meaning it is time
to investigate to determine problem areas.

Talent Corner HR Services Pvt. Ltd.


THAKUR INSTITUTE OF MANAGEMENT STUDIES & RESEARCH
Prsented by Safakat Ibrahim Agashiwala(PGDM 2008-2010)
28


Interview Efficiency.
Next, the interview efficiency is a measure of the hiring manager's screening process. It is defined as
the number of candidates who receive offers divided by the number of candidates interviewed. You
would expect this number to be lower than the submittal efficiency, since most people want to
interview several candidates for one offer. The goal is to shoot for 30% efficiency, which means your
organization is making offers to one out of every three to four interviewed candidates. If less than one
in six candidates interviewed actually receives an offer (16% efficiency), it should be an indicator that
it is time to investigate again. With low efficiencies there could be any number of problems, most of
which are issues in the screening process, including a hiring manager who is overly selective.
However, recruiters can be great assets during this phase because they can help out with scheduling
interviews, prepping candidates, gathering immediate interview feedback, and generally guiding the
process.
Offer Efficiency.
The third of the Big 3 is the offer efficiency, a measure of how many candidates actually accept your
offers and start working with you. It is calculated as the number of candidates accepting offers divided
by the total number of offers. Since the recruiters should be helping hiring managers extend offers that
will be accepted, as well as pre-closing the candidates, we expect this ratio to be high. If the process
yields 80% offer efficiency, or four out of five offers are accepted, you are doing well. Conversely, if
less than three in five offers are accepted (60% efficiency), then something in your recruiting processes
will need to be modified or addressed. Low offer efficiencies could mean the recruiter is doing a poor
job of pre-closing the candidate or negating counteroffers. Or perhaps the offers themselves are
undesirable, whether from a financial standpoint or on other dimensions, such as too much travel or an
undesirable work location. Also, as with submittal efficiencies, the offer efficiencies percentage can be
too high. If 100% of people accept your offers, perhaps you are offering too much money for the job.
The efficiency metrics are relatively easy to gather and calculate, and very helpful in monitoring the
quality of the recruiting process. By investigating the issues indicated by the efficiencies, it's possible
to identify potential problem areas in sufficient time to take corrective action and still make hires on
time.
Another benefit of the efficiency ratios is that by multiplying all three of them together, it's possible to
calculate the expected number of hires from the number of submittals, assisting your planning process.
For example, multiplying the lower bound of the "good" efficiencies (75% X 30% X 80%) = 18%,
which means you need to submit between five and six candidates to get one hire.

Talent Corner HR Services Pvt. Ltd.


THAKUR INSTITUTE OF MANAGEMENT STUDIES & RESEARCH
Prsented by Safakat Ibrahim Agashiwala(PGDM 2008-2010)
29


Conclusion

The present value of the recruitment process outsourcing industry (RPO) in India is estimated to
be $2.5 billion and it is expected to grow at the annual rate of 30-40 per cent for the next couple
of years. According to a recent survey, only 8-10 per cent of the Indian companies outsource
there recruitment processes. However, the number of companies outsourcing their recruitment
processes is increasing at a very fast rate and so is the percentage of their total recruitment
processes being outsourced.

Outsourcing organizations strive for providing cost saving benefits to their clients. One of the
major advantages to organizations, who outsource their recruitment process, is that it helps to
save up to as much as 40 per cent of their recruitment costs. With the experience, expertise and
the economies of scale of the third party, organizations are able to improve the quality of the
recruits and the speed of the whole process. Also, outsourcing enables the human resource
professionals of organizations to focus on the core and other HR and strategic issues.
Outsourcing also gives a structured approach to the whole process of recruitment, with the
ultimate power of decision making of recruiting with the organisation itself. The portion of the
recruitment cycle that is outsourced range from preparing job descriptions to arranging
interviews, the activities that consume almost 70 per cent of the time of the whole recruitment
process.
In India, the trend of outsourcing recruitment is also catching up fast. For example: Vodafone
outsources its recruitment activities to Alexander Mann Solutions (RPO service provider). Wipro
has outsourced its recruitment process to MeritTrac. Yes bank is also known to outsource 50 per
cent of its recruitment processes.





Talent Corner HR Services Pvt. Ltd.


THAKUR INSTITUTE OF MANAGEMENT STUDIES & RESEARCH
Prsented by Safakat Ibrahim Agashiwala(PGDM 2008-2010)
30


AKNOWLEDGEMENT
I HEREBY THANK MR.BANKIM DOSHI (DIRECTOR) TALENT CORNER HR SERVICES
PVT. LTD. TO GIVE ME AN OPPORTUNITY THAT LED ME TO VENTURE INTO AN
ENTIRELY NEW ARENA AND DISCOVER THE INTRICACIES OF RECRUITMENT
PROCESS OUTSOURCING WORLD. IT WAS DURING THIS PROJECT THAT I HAD TO
PRACTICE WHAT WAS PREACHED TO ME BY MY PROFESSORS. DURING THIS
JOURNEY I REALIZED HOW DIFFERENT IT IS TO PRACTICALLY IMPLEMENT THE
PRINCIPALS OF MANAGEMENT SUCCESSFULLY. THIS PROJECT IS DEDICATED TO
ALL THE PEOPLE FOR THEIR CONSISTENT SUPPORT AND GUIDANCE THAT MADE
THIS JOURNEY EASIER AND INTERSTING.











Talent Corner HR Services Pvt. Ltd.


THAKUR INSTITUTE OF MANAGEMENT STUDIES & RESEARCH
Prsented by Safakat Ibrahim Agashiwala(PGDM 2008-2010)
31


Bibliography
1) Google Search
2) Mafoi consultancy services
3) Citihr.com