Recruiting and Shared Services
The theme of the moment in HR is finding and retaining talent. If you read any HR blog or attend any HR conferences or events, the top focus is about how to hire better, faster and adopt management practices to keep your staff longer. It is a challenging time for the recruitment function in most organisations. Many companies have put aspects of recruitment into shared services or outsourced arrangements, but with increased demand, and hiring managers screaming for results, it can become too easy not to follow the processes put in place to save the business time and money.
These challenges create an excellent opportunity to review what recruitment activities and services you could put into a central shared operation or outsource to a trusted partner.
Before you can determine what makes sense to centralise in a shared service centre (SSC) or outsource organisations businesses should review their workforce planning and their strategy for sourcing talent. Strategically the HR and Talent Management team need to agree with the business four major areas:-
- What types of people are we going to hire for which roles and positions?
- Are they going to be permanent, contract or contingent labour?
- Or Consultants on an output based contract?
Knowing what is the preferred type of employment for specific areas is key to setting up the right sourcing channels and what can be outsourced or centralised in an SSC.
How many people do you think you are going to need to hire over the next twelve months in specific jobs or roles? If you are staffing a call centre and you have a 20% turnover the roles are most likely going to classify as high volume, more easy to fill. If you think you are going to need ten AI engineers that would be a different challenge regarding finding and attracting the right talent. Understanding the volume associated with the various role types will help to determine the role of an SSC or outsourcing for this kind of hire.
What technology do you have in place today for postings, applying and tracking, both internal and external hires? Will there need to be an investment in technology before anything can be centralised? Or if you are very local perhaps going back to some more old fashion methods might yield better results? A critical review of the existing technologies and their level of “robustness” with respect to supporting centralised services is essential.
What are the measures of success within your recruitment area? Everyone measures time to hire but what else is important? Is having an approved list of job ready candidates a primary measure for some positions? Or the number of employees referred candidates critical to getting high-quality candidates? What are the appropriate measures of success for each of your talent management pools?
Based on the matrix created by the answers to these four questions you will determine which are the best processes and activities to centralise within the recruitment area to drive better results. Within recruitment, there is not a “one size fits all” when it comes to centralisation or outsourcing. The best model for any business will most likely be a hybrid solution with a different approach to delivery for various parts of the matrix. Here are three examples.
Example One - If your company has a high level of contingent labour for lower skilled roles you might want to outsource the end to end hiring, employment, payroll and HR administration (holiday, sickness etc.) to one supplier. The day-to-day task and performance management of the individual would still be with your line managers, but the more core HR activities would be outsourced to your contingent labour partner.
Example Two - For the higher skilled, harder to source roles, you may want to have an internal proactive head hunting unit within your HR team. A team that knows how to use LinkedIn and other platforms to proactively find great talent (even if they are not looking for a new role) to come and join your organisation. For these types of positions, you may not want to centralise or outsource any of the activities as finding the right skills and competencies outweighs the need to be lower cost.
Example Three - In the middle, there will be hybrid roles and positions that can be hired efficiently and effectively with a mix of in-house recruitment support for the hiring managers but centralised or outsourced activities. For these types of roles, the centralised activities could include job posting, applicant searching (so who has skills that you want that are looking for a new job) and matching to get the right short list of candidates. Other activities that can be centralised include setting up and following up on interviews, reference and background checks or other pre-employment activities that might be needed before the hiring manager makes an offer to the candidate. Within this list of centralised activities, it is also worth considering which areas might be outsourced to bring even more cost savings. RPO (Recruitment Process Outsourcing) providers would do most if not all of the centralised activities instead of a captive shared service operation. Or an organisation can outsource specific tasks such as background checking or testing.
No matter which model(s) makes the best business sense for your organisation you should do an end to end process design considering the four questions above and critically assess which delivery model will provide the more efficient and effective results for specific hiring groups.
As it becomes more and more difficult to find the right talent for your organisation, it also becomes more likely that hiring managers needs increased support and help from HR and the Talent Management team. Centralising recruitment activities into a captive SSC or outsourcing all or some of the recruitment processes is one-way businesses can keep the cost to hire under control while at the same time supporting the line managers, so they don’t just hire the first person they interview because they are desperate for resources. Increasing the support to the hiring manager can help them focus on getting the best talent possible in this more challenging labour market.