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Everything You Need to Know About Recruitment Process Outsourcing (RPO)

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By Taggd Editorial Team

September 29, 2023


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In the past couple of years, the job marketplace has changed exceptionally, which has profoundly impacted the organizations’ hiring processes. The businesses have understood the significance of outsourcing non-fundamental operations to external agencies for better results at the lower processes. A similar thing applies to organizations relying on recruitment process outsourcing (RPO): they say they are getting better candidates at lower costs. 

According to a recent survey, 60% of organizations want to enhance the candidate’s quality and rely on RPO providers to achieve their goals. It is beyond doubt that RPO is a multi-billion dollar industry focused on providing the best recruiting process to mid & large-size organizations. 

So, with all that said, explore recruitment process outsourcing, its benefits, and how AI contributes to this industry’s success. 

What is Recruitment Process Outsourcing (RPO)?

Recruitment Process Outsourcing (RPO) is a specialized service provided by external recruitment firms or experts to manage some or all of a company’s recruitment needs.

An RPO provider enables organizations to solve their most strenuous hiring problems with appropriate candidates who become great employees. 

Reports of EY say that almost 81% of organizations globally report a talent shortage, which means they do not find suitable applicants to fill the vacant positions. Here, RPO providers assist organizations in overcoming this major challenge and finding the best candidates for them. 

The RPO industry started developing almost two decades ago; today, there are different types of RPO present in the market. Some of the most common types are:-

  • End-to-end full-service RPO
  • Project-based RPO
  • Selective/hybrid RPO
  • Recruitment on demand (ROD)

How Does RPO Work?

  • Assessment and Strategy Development: The RPO provider begins by assessing the hiring needs and objectives of the client company. This includes understanding the culture, values, and specific job requirements.
  • Sourcing and Attraction: RPO firms employ various strategies to source candidates, from traditional job boards to social media and industry-specific platforms. They use targeted marketing to attract top talent.
  • Screening and Assessment: Once a pool of candidates is identified, RPO professionals use their expertise to screen and assess applicants, ensuring they meet the company’s criteria.
  • Interviewing: RPO providers may conduct initial interviews or facilitate the interview process on behalf of the company. This helps ensure that only qualified candidates proceed further.
  • Offer Management: RPO firms often assist in crafting competitive job offers and manage the negotiation process with candidates.
  • Onboarding: Some RPO agreements include onboarding services, helping new hires transition smoothly into their roles.

Exploring the Benefits of Using an RPO

Choosing RPO over traditional hiring strategies has many edges and benefits. So, here in this section, we will discover the most important ones. RPOs can help you: 

  • Cost Savings: RPO can significantly reduce recruitment costs. By outsourcing the process, companies can avoid expenses related to advertising, job boards, and the salaries of in-house recruiters.
  • Time Efficiency: RPO firms have the expertise and resources to expedite hiring. This means low turn-around time, reducing the burden on internal HR teams.
  • Access to Talent: RPO providers have extensive networks and access to a broad talent pool, increasing the likelihood of finding suitable candidates for specialized roles.
  • Scalability: RPO is adaptable and can scale with a company’s changing needs. Whether you’re expanding rapidly or downsizing, RPO can flex to accommodate fluctuations.
  • Compliance: RPO experts stay up-to-date with employment laws and regulations, reducing the risk of legal issues during the hiring process.

How AI Can Help RPO Providers

As per the Deloitte Human Capital Trends report, it is expected that around 62% of hiring managers may use AI for recruitment by the end of 2027; however, according to LinkedIn’s Global Recruiting Trends report, 35% of hiring professionals said that AI is going to be the future of hiring.

By using AI and automation-based recruitment software, organizations attract top candidates and provide unmatched candidate experience. Hiring professionals rely highly on this software for sourcing, screening, nurturing, scheduling, and engaging candidates. Let’s explore several factors that prove how AI-based hiring can be a boon for your organization. 

  • Efficient Resume Screening: AI-powered tools can swiftly sift through many resumes, identifying top candidates by parsing and assessing keywords, qualifications, and experience. This eliminates the time-consuming task of manual resume screening.
  • Predictive Analytics: AI algorithms analyze historical data to predict which candidates will most likely succeed in specific roles—the likelihood of selecting the right fit.
  • Chatbots for Initial Screening: AI-driven chatbots engage with candidates, asking pertinent questions and evaluating qualifications. This speeds up the initial screening process, providing instant feedback to candidates.
  • Candidate Sourcing: AI tools automate the search and sourcing of candidates from various platforms and databases, saving recruiters valuable time.
  • Interview Scheduling: AI-driven scheduling tools coordinate interview times between candidates and interviewers, minimizing scheduling conflicts and streamlining the interview process.
  • Diversity and Inclusion: AI helps remove unconscious biases by focusing on qualifications and experience rather than personal characteristics, fostering fair and diverse hiring practices.

Final Thoughts

“Any sufficiently advanced technology is indistinguishable from magic.” – Arthur C Clarke.

Technology & talent analytics are crucial to finding the most appropriate candidate.

Using reliable AI and advanced software allows ROPs to streamline their hiring process, reduce turn-around time, improve hiring quality, diversify the workforce, and many more. Contact us for more information. 

By Taggd