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Make the Most of Your RPO Renewal

CadiganStacey
by Stacey Cadigan

As organizations move into the next generation of their recruitment process outsourcing (RPO) relationship, they often have a keen appreciation for the role a well-executed contract can play but are not sure how to steer the process to achieve maximum benefit. If managed well, contract end-of-term can be an opportunity to create new value by realigning the RPO arrangement to strategic, operational and financial goals.

We recommend these Top 5 steps for getting the most out of your next-generation RPO contract.

  1. Update your service delivery model to improve quality. As RPO service delivery models become more strategic in nature, the scope of services will likely need updating as well. This may mean incorporating employment branding services, ongoing pipeline sourcing for a targeted set of positions or increased consultation with hiring managers.
  2. Reprioritize service-level agreements (SLAs) and implement forward-looking metrics. Some of the traditional SLA measurements you put in place a couple of years ago may need refreshing. Aim for measurements that are meaningful, outcome-focused and indicative of actual performance. This is particularly true if the RPO provider reports all SLAs are “green” but you still experience gaps in service or fall short of desired outcomes. Focusing on the right priorities and critical metrics will help the RPO provider focus on the most impactful outcomes for your business.
  3. Tighten the governance structure. Client satisfaction in an RPO relationship is most often driven by the extent to which an RPO provider acts as a strategic partner, brings new ideas forward, proactively manages the account and quickly resolves issues. We recommend formalizing the partnership approach and implementing a governance model that includes an RPO Account Management scorecard.
  4. Validate pricing and structure to reflect actual hiring activity. Renewals are an opportunity to validate that your pricing is still competitive in the market. For global deals, this means comparing pricing at an overall contract level and within key regions. Ensuring regional competitiveness is important as your organization expands or contracts to prevent an unwanted shift in overall RPO pricing and organizational risk.
  5. Build the right level of flexibility into the contract. Be sure you have the flexibility you need to address changing volumes, shifts in strategy or other business changes over the course of a multi-year contract. Enterprise buyers that push providers to demonstrate their agility and flexibility in addressing changing talent acquisition needs will be better prepared for the unexpected.

ISG has the strategic perspective, operational expertise and market insight and data to support your RPO initiative. Please contact me to discuss further.

About the author

Stacey is a director and a key contributor to ISG’s human resources and talent-related technology and services. She advises clients on all aspects of human resources engagements, including recruitment process outsourcing and talent management. Stacey is a prolific blogger, and is frequently interviewed by industry publications. With nearly 20 years of experience in solutions strategy, product development, corporate HR, operations delivery, transitions and HR consulting, Stacey has deep operational knowledge of the talent space and her clients’ challenges, as well as a unique ability to ask the right questions to help organizations align their sourcing initiatives with their vision.