- 18 April 2024
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Kristie Perrotte
Recruitment agencies are constantly seeking avenues to adapt, innovate, and thrive. One avenue gaining momentum right now, is transitioning into Recruitment Process Outsourcing (RPO) recruitment. This has the potential to open new doors for agencies, with opportunities to not only expand their service offerings but also develop a recurring revenue model as well as potential higher valuations in any future potential capital events. To shed light on the why, the how, and the potential of RPO recruitment for agency recruiters, Kristie Perrotte, Thrive Founder and MD, sat down with Paul Sharpe, recruitment mentor and business guru from North Star People. Here are the highlights of their insightful conversation.
Why the Shift to RPO?
Paul was quick to highlight the most compelling driver behind this trend toward RPO recruitment: while certain sectors in the recruitment industry may face challenges, the RPO sector continues to witness remarkable growth.
“The RPO sector is continuing to grow. Staffing industry analysts have reported double digit growth since 2021 and the forecasting is that it is going to continue to grow at that pace.”
This growth provides promising opportunities for agency recruiters, particularly those operating within SMEs, as they can maintain control over client relationships and stop large providers from coming in and sweeping up business.
Challenges and Opportunities
Embracing RPO recruitment requires recruiters to shift from a traditional transactional approach to a more holistic, consultative one. To do so successfully means understanding the end-to-end recruitment process and positioning oneself as a strategic partner. Paul explains,
“RPO is about embracing the whole process and really adding value. If you are looking at the RPO recruitment market and thinking that your customers are going to want to outsource everything, that’s not the reality.”
But for agencies who are successful, RPO offers the opportunity to build enterprise value in the long-term. As Paul says:
“Increasing the enterprise value of your business gives you options. I’m not saying you won’t have options without RPO, but your enterprise value will be less if you haven’t got some form of recurring revenue.”
That’s not to say RPO recruitment is without its challenges! The biggest hurdles for agencies include brand awareness and tech integration. But while these can be challenging, they also serve as catalysts for growth, giving agencies a tangible path towards long-term sustainability and competitiveness.
Navigating the Transition to RPO Recruitment
The transition to RPO recruitment requires meticulous planning and strategic execution. Paul and Kristie outline three key steps for agencies embarking on this journey:
- Defining your strategic objectives – what is your goal?
- Segmenting the customer base – do you have existing high level customer relationships?
- Establishing a minimal viable product – can you articulate your product?
This strategic approach sets the stage for effective client engagement and value delivery. Paul ultimately advises those struggling to “take a step back and understand from a strategic perspective what you’re trying to achieve, why and by when.”
The Role of Employer Branding
Central to the success of RPO recruitment is the cultivation of a strong Employer Value Proposition (EVP) and employer brand. Both Kristie and Paul underscore the pivotal role of marketing in this endeavour.
Kristie notes:
“Partnering with experts can ensure a robust brand narrative and a compelling employer brand, essential for attracting top talent and retaining employees… Marketing is an absolute necessity to bake into your offering. Businesses expect more from outsourced recruitment than just bums on seats. Recruitment agencies need to deliver a long-term employer brand and digital talent acquisition strategy to provide that extra value-add that’s expected in an RPO offering.”
Kristie also emphasised the importance of accessing specialised marketing skills for navigating the complexities of modern recruitment. “Marketing is shedding its reputation as the colouring in department, especially amongst enterprise and leading employers who already have a strategic commercial marketing function. They expect their talent marketing to align.”
Seizing the Opportunity
The window of opportunity for RPO recruitment is wide open and those agency recruiters who embrace change and innovation will be best placed to capitalise on such a limitless space for growth.
As Kristie highlights:
“This shift towards consultative, professional RPO offerings will separate the wheat from the chaff, elevating agencies to new heights of success.”
With the right strategy, mindset, and partnerships, agencies can seize the transformative potential of RPO recruitment and cement their position as indispensable partners in talent acquisition.
Inspired by Kristie & Paul’s insights and want to know more? Download their full conversation here.
Paul is Co-founder of North Star People and mentor, coach and advisor for recruitment agency owners and leaders, helping them to be the best possible professional version of themselves. He understands the value of marketing, research, and innovation in standing out from the crowd and his expertise and down to earth approach have resulted in a strong network of trusted relationships and friends for life within the recruitment sector. With this trust, he has personally built, sold, and implemented several RPO and MSP solutions and bespoke Talent Advisory Solutions.
Check out Paul’s LinkedIn
Thrive Recruitment Marketing is the leading employer branding and recruitment marketing agency for scaling and fast growth businesses. We empower our partners to achieve their growth goals, scale their business and hire the right talent by aligning and activating employer and commercial brand strategies. The result – thriving businesses enjoying sustainable revenue and recruitment success.
