Capita - Putting innovation at the heart of RPO

InnovationPutting

of Recruitment Process Outsourcing at the Heart

True Partners. Trusted to deliver.


About Capita page 3

Executive Summary page 4

Introduction: the State of the Market page 6

• Key market trends

Research Findings page 9

• What is innovation and how can the market become more innovative?

• What adds value?

• How can resourcers become more strategic?

• What do clients want recruiters to do?

• What are the strengths and weaknesses of RPOs in adding value? What role can they play in innovation?

• A third model?

Capita’s View page 12

• Our objectives

• Our solutions

• Our conclusions

Appendix page 17

• About the authors

• Contributors

Contents

True Partners. Trusted to deliver. p a g e 3

About Capita

Capita Managed Services is the strategic resourcing business within Capita plc.

Our teams work across the UK commercial, regulated and government sectors – creating tailored solutions in permanent and contingent workforce recruitment.

Over the past 15 years, we’ve built client retention by placing collaboration at the heart of every relationship. We foster genuine partnerships which develop the maturity and impact of resourcing activity – our ultimate goal is to align talent acquisition strategies directly with strategic business goals.


Executive Summary

The latest research from the Everest Group on the global RPO market suggests that despite 12% growth in the market, the large providers have not increased their market share.

Instead the sector has seen an increase in the number of small specialist suppliers, often operating alongside bigger partners, fulfilling specific requirements within particular service segments. Everest Group suggests that this is a result of larger suppliers’ failure to provide full, end-to-end resourcing solutions that are sufficiently creative and innovative to deal with emerging business needs.

The issue of innovation in RPO is a complex one.

Practically all invitations to tender suggest that innovation is critical to contract award but our questioning around what this means to clients, in practice, often produces different answers.

Why and how we undertook this research

We decided to carry out research to explore the notion of innovation in RPO and to work with a diverse group of buyers to understand how RPO models can be better configured to realise the benefits from innovation.

We undertook interviews with senior resourcing managers in 21 blue chip organisations. Our questions focused on buyer perceptions of innovations in resourcing (i.e. what innovation means to them), the role that innovation plays in adding value, their views on the optimum model for resourcing (i.e. outsource, insource or rightsource) and whether they believe there are possible new, innovative models of delivery yet to be discovered.

What we discovered

The research paints a picture of an industry that is at a crossroads, with an evident disconnect between suppliers and buyers which is stifling business development and innovation.

The respondents were particularly critical of the sector’s failure to really engage with candidates and build relationships with hiring managers, believing some of the problems to lie with technological innovation which has impacted negatively on personal interaction.

They were also critical of the quality of staff on many accounts and their inability to act as ‘talent advisors’ rather than recruitment process operators. Problems were also linked to contract governance, with an over-emphasis on outputs rather than outcomes. Linked with this is the inflexibility of some providers who appear intent on providing a ‘one-size-fits-all’ process rather than a solution.

Some of the respondents reflected these challenges back on themselves. Several were linked to their habit of contracting on cost alone, a failure to challenge how resourcing is perceived as a business discipline within their own organisation, a lack of focus and investment in workforce planning and talent management.

Perceptions of RPO providers

Ultimately the research establishes that RPO providers are mainly viewed as volume processors and not strategic resourcing partners with the capacity to add value. There is a tendency for them to over-sell and under-deliver. Their attempts at innovation are ‘noise’ and reinvention rather than true innovation that has the potential to create new ways of working and better solutions.

As a result, many of the respondents felt that they would only engage with RPO providers to manage ‘the churn’ while the added value elements stayed in-house.


Need to connect resourcers and clients

The research proved challenging reading, but by exploring the disconnect between resourcers and buyers, the study provides clarity about the nature and scope of the challenges and what needs to be done to overcome the problems.

Through better pre-tender engagement there is scope for developing superior commercial models and solutions that will support joint working and solutioning and therefore value adding. To realise the benefits from this we agree that there needs to be a different cadre of staff involved in the account who can solution and find new, creative ways of working. These people need to be professionally educated in resourcing and better supported by knowledge, evidence and market information – including being kept up to date with innovations and new practices. RPO providers should act as ‘brokers’ to introduce the latest technologies and solutions from specialists to their clients.

Resourcing must be more highly valued

Rigorous adherence to processes needs to be replaced by mechanisms for business unit adaptation and solutioning and the development of partnership working with hiring managers. Working together, RPO providers and their clients need to move resourcing up the value chain and encourage senior managers to support workforce planning and longer-term engagement strategies. This would enable organisations to more effectively build and maintain their branding conversations with prospective hires and create better talent pipelines.

The research has demonstrated that real innovation can be found in partnership working and not technology or new processes which are merely the tools that are developed to achieve innovative practice.


Introduction: the State of the Market

The global RPO market can be characterised as follows:

In 2012, it grew by 12%, despite a decrease in hiring volumes. This suggests that the sector is still buoyant and competitive.

There has been a period of consolidation with several large-scale mergers and acquisitions. However, the large providers have not significantly increased their market share.

The market remains fragmented with a large number of suppliers operating in buyer segments differentiated by geography, technology solution or job family.

It is difficult to create an innovative, one-size-fits-all solution due to so many niches in the market. Instead, small specialist and innovative providers fill the gaps.

Gaps in the market might arise as a result of emerging technologies (such as cloud-based solutions and mobile technology), new ATS platforms (such as those that integrate with social networking sites), and predictive analytics for workforce planning or improved data mining technologies capable of handling big data.

Setting the Context: the Changing RPO Landscape

What will clients demand from their RPO providers in the immediate future?

If we look at the US market, which is about 3-5 years ahead of the UK’s, we can get a good sense of where the UK market is heading. We have identified the following trends and issues in the US provider and customer landscapes (sources include) RPO Association, Everest Group and Bersin by Deloitte.

What are the key market trends?

Trend 1: From monologue to dialogue

The approach to connect with candidates has become more complex. Previously, there was a relatively small number of channels under direct control of the recruiter. Now there are many channels and stakeholders, each with their own voice.

It is no longer enough to have a monologue with candidates based on a simple narrative that reflects the brand ambitions and static EVPs. Resourcers must engage in a dialogue with both active and passive candidates, which takes longer.

Resourcers also need to use a greater number of channels to target and communicate with different audiences.

The use of social media as a recruitment tool must become more sophisticated. Despite the hype, scepticism has grown over recent years over how effective this technology is within the industry.


Trend 2: Market segmentation

The US market has become more segmented.Mergers and acquisitions have consolidated the market and there are a glut of new entrants specialising in specific niches.

In the US, there has been very limited growth in full life-cycle RPO deals.

Co-sourcing is now common, with more than one RPO provider being invited into the organisation to work collaboratively on end-to-end needs.

Project RPO and point of service RPO deals are growing. Here, specialist providers are asked to complement the services of either in-house or other outsourced providers.

These new boutique providers – many of which originated outside of resourcing – are bringing new thinking and technologies to the sector. This is resulting in more flexible solutions, in contrast to those generated by the business models of some of the big players which are based on generating economies of scale.

Trend 3: Bespoke solutions –using technology to add value

There is growing acceptance that technology can speed up the development of effective solutions but not at the expense of the ‘personal touch’.

Resourcing is, fundamentally, a people business and therefore the most creative developments are those that enable people to deliver better, more personalised solutions rather than those that try to automate how services are delivered.

Joel Capperella, vice-president of the RPO Association and CEO of Yoh, an emerging US-based RPO provider, emphasised this when he said:

The real opportunity is the creation of value and creating competitive advantage through people.

Trend 4: Conflict between cost and value adding

There is a disconnect between what resourcers and clients believe should be at the heart of the recruitment process – a positive candidate and hiring manager experience, quality candidates, fit with employer brand, zero-time recruitment based on better talent pooling – and the emphasis on driving down costs.

Resourcers are recognising that clients are driven by value and the total employment experience for candidates, rather than by cost.

There is still too much emphasis on cost reduction in big contract awards. This is one of the reasons the experience for candidates and hiring managers has shown little improvement over the past 10 years.

Trend 5: The importance of talent pipelines

Attempts by recruitment agencies to create cost-effective talent pipelines have met with limited success. In many cases talent pools have merely become databases of names.

Resourcers are making slow progress in developing better solutions with pre-screened and pre-assessed candidates. Obstacles include unsophisticated workforce planning that fails to support confidence in predicted hiring volumes.

There is still too much emphasis on past data and historical patterns of recruitment instead of predictive analytics and scenario planning.

Many resourcers are hesitant to develop talent pipelines without guaranteed job openings. Investing time and resources in candidate engagement presents a risk, especially in today’s uncertain economic climate.

Resourcers believe the talent pipeline market will become a breakout segment of its own which will intersect with RPO, but not necessarily be a part of it. This could attract new, risk-taking, market entrants able to build pipelines that will create a new hiring process for many roles.


Trend 6: Clients want a broader set ofadded-value solutions

Clients are not afraid to negotiate many contracts with different resourcers.

They seek more value in terms of strategy and solutioning.

There is growing demand for the resourcer-client relationship to become more partnership-led and less contractual. However, many RPO models do not allow for this.

Our research suggests that top quartile performers are significantly better at relationship management than their lower performing peers.

To be effective, innovations must do the following:

Help improve conversations with active and passive candidates and develop a better way of engaging with the next generation of worker.

Provide very targeted point-of-service solutions throughout the recruitment cycle.

Support an excellent candidate experience, without becoming impersonal.

Boost the development of talent pipelines and pools and reduce time to hire.

Add value to the process for the client (extending into wider areas of talent management.


Research Findings

What is innovation and how can the market become more innovative?

One respondent said:

Innovation simply means removing the stuff that doesn’t add value and adding the stuff that does.

Some respondents feel that the ‘stuff that has been added’ by the suppliers in recent years has actually set the industry back.

The emphasis has therefore been on:

Developing processes to support sophisticatedATS systems.

Blindly pursuing social media strategies without any real sense of how these things benefit either the hiring manager or the candidate.

What adds value?

When asked this question, respondents mentioned the following:

Total workforce planning

Branding and consistency

Building communities and networks (channels rather than job specs and adverts)

Direct sourcing

Being a true advisor to the business

Account managers that provide solutions rather than sell

Being more strategic.

One respondent commented:

It should be more about strategic planning and a voice at the top table. The concern I have is that recruitment is just seen as a transactional model. Who is sitting down with the managers and working with them as ‘business partners’?

How can resourcers be more strategic?

Take a more advisory role

Focus on talent planning

Engage with candidates personally

Increase convergence with HR and the wider business (eg the relationship between customers and candidates)

Balance candidate personalisation with technology

Give hiring managers more control.

What do clients want recruiters to do?

Use technology only as a tool to support true innovation and build relationships

Many resourcers feel they are being innovative simply by using the latest mobile and CV mining technologies, online assessment and social media tools. But in the sector these are not always seen as having the potential to make a big difference.

One respondent said:

We are all far too easily distracted by the noise that is considered innovative.

Return to old-school techniques

Recruiters must see their role as one of ‘relationship builder’ with both candidates and hiring managers.

Be true talent advisers with real business acumen.

Respondents almost universally agreed that this is lacking in the sector (both in in-house and outsourced models) and this is hampering real innovation at a grass-roots level.

Re-focus on outcomes instead of outputs

Use approaches which allow the candidate experience to be ‘authentic’. The hiring manager experience should be simple but with enough control that they can be confident in the quality of candidates.

Be flexible and scalable

True Partners. Trusted to deliver. p a g e 1 0

Clients appreciate resourcers that look outside of one-size-fits-all processes and are willing to adapt solutions to different divisions and business circumstances.

Many in-house teams struggle to deal with the peaks and troughs in demand – having a flexible resource of contract professionals to boost teams would be an attractive proposition.

Change the business model

Respondents disagreed over whether better commercial models should be developed based on centralisation and economies of scale. Some felt that, instead, models should balance the need for cost efficiency with responsiveness to candidates and ‘closeness’ to line managers. Two respondents believed the latter might remove the need for HR/resourcing business partners which would make a considerable difference to the HR cost-base.

Only one respondent said that detailed, documented processes with quality MI/reporting – with clear roles and responsibilities between recruiters and hiring managers – were important and relevant.

Workforce planning

Many view this as the ‘missing link’ in the resourcing process. Workforce planning facilitates the development of pipelines and enables better engagement with prospective staff. Some respondents also linked this to better management of permanent and temporary resources, with some alluding to the challenge of developing ‘total workforce solutions’ across all groups including permanent, fixed term, temporary, consultant and statement of work contractors.

Branding

This was mentioned by a number of respondents who felt that there was scope for improved brand activity to help attract talent that ‘fits’ with the organisation’s needs across all businesses and divisions.

Adding value

What are the strengths and weakenesses of RPOs in adding value? What role can they play in innovation?

RPO providers excel in handling volume and temporary recruitment

Their model can fit a number of sectors and positions – they are really geared towards the volume in common job categories. They are a one shape fits all type of business.

I think they are really good in the volume space.They can scale up and down with regard to volume related activities.

RPO providers are less useful for permanent hires, especially senior and professional roles

Respondents suggested the following reasons for this:

They lack innovation.

They try to ‘tie down all details in the commercials’, which results in a lack of flexibility.

Recruiters are more likely to be accepted by the business as advisers if they are part of an internal team.

The cachet of your own brand means you can get better quality recruiters if you hire directly.

They are more concerned with selling many services than getting the basics right.

They are “not as strategic as they think they are and there is a lot of chatter and sales bumpf”.

With senior posts, organisations want to keep control and “make sure it is done properly”.

There is a cost advantage in using the supplier for the process but the key thing is never to outsource the decision – just outsource the heavy lifting.


Resourcers lack knowledge of the organisations they are hiring for

Many respondents questioned recruiters’ ability to truly understand the problems and challenges facing an organisation and to create innovative solutions.

For some, the fact that the outsourced partner could not provide anything that they could not do themselves meant that there was no clear business case for outsourcing.

This leads to lack of trust, which hampers efforts at developing relationships and supports the idea that recruitment to business-critical roles should never be outsourced as there is too much at stake.

Resourcers offer generic rather than tailored solutions

Resourcers typically try to sell ‘off-the-shelf’ solutions instead of consulting with the client on specific problems and challenges and responding with something that will work for that organisation.

A third model?

Is there a ‘rightsource’ model that sits somewhere between outsourcing and in-house recruitment?

The almost unanimous view is ‘yes’ – although there was less consensus about the form that such a model might take.

Suggested features include:

Specialist niche providers that offer a range of services from talent pools of pre-screened and pre-vetted candidates.

Teams of contract recruitment consultants hired to meet peaks in demand.

Specialist search providers that provide quality longlists at a lower price than the traditional headhunters.

A ‘total workforce solutions’ model that builds workforce planning and forecasting into the process.

Effective relationship management at its core.

Experts from outside the business that fill the gaps where internal teams cannot deliver.

Solutions tailored to the specific needs of the business.

Hybrid model or a ‘blended solution’ in which some elements are kept in-house while others, starting with volume processes, are increasingly outsourced as trust and relationships are built.

A ‘fluid relationship’ approach, with emphasis on working in partnership, might be more appropriate than a model.


The State of the Market: Capita’s View

Industry at a crossroads

Although there has been a lot of talk in the past few years about the global RPO market maturing, there are conflicts between recruiters and clients in the RPO space which are preventing business development and true innovation.

A case for outsourcing

The fact that, globally, the industry continues to expand means that there is still a strong business rationale for outsourcing. However, because the benefits of doing so are often not realised, perceptions of the RPO industry are not where they should be. Resourcers are typically perceived as organisations able and willing to take on the ‘churn’ end of the recruitment process, which adds little value to the organisation.

Sustainability of current model is questionable

The growth in use of specialist niche providers to provide specific point-of-service solutions suggests that clients are not confident that large RPO providers are developing the right kinds of creative solutions across the resourcing life-cycle.

Engaging on cost and asking suppliers to provide a high-volume, low-value service on tight margins means that even the biggest players are making little money. Without moving up the value chain their future is uncertain.

Our objectives

We want to be an added-value RPO provider across the public and private sectors and we want to develop the best resourcing solutions by taking an innovative and creative approach. We are sure this is little different to the objective of our leading competitors. What is preventing us all from achieving this and providing clients with the high-touch, value-added and innovative solutions that buyers are demanding?

The challenges of a flawed model

1. The tendering process

We believe this research has shed light on the problems. At its heart is the tendering process and the requirements which are set out for suppliers. We are asked to respond to a range of issues about how we could add value (which we do based on our centralised capability within our business). At the same time, we are asked to show how we will save the client money and drive down costs.

In some bid models we are evaluated against our peers through prescribed transactional cost models which means we have little flexibility to demonstrate alternative approaches to delivering the best solutions. On paper, we may appear to be over-promising, as we paint a picture of what we could deliver in an ideal world. When the commercial reality takes hold, bidders rush to the bottom with their cost calculations in an effort to win the contract.

2. Inexperienced client-facing staff

Contracts which are secured in this way offer tight profit margins which mean that incumbents are then under pressure to cut costs and find additional income streams through selling in added-value services.

This results in relatively junior staff on the ground attempting to open the doors for more experienced staff and specialists to come and discuss added-value services and creative solutions. The reality in some contracts, however, is that the junior staff ‘set the tone’ and the lack of trust in their strategic and innovative abilities can prevent clients from seeing the depth of knowledge, expertise and innovation that the company can offer through its central teams of experts.


3. Lack of engagement

Missing from the process, more often than not, is an extended period of pre-engagement and/or competitive dialogue. Through this we can help shape request for proposal requirements and tailor commercial solutions in ways which have been prescribed by the resourcing managers that took part in the survey.

Contentions that providers are selling ‘off-the-shelf’ products and services are therefore true at the point of tendering, as our bids reflect what we have delivered elsewhere rather than tailored solutions for specific clients. Without meaningful dialogue and a period of time to ‘get under the skin’ of the organisation, the prescribed solutions are generic rather than differentiated. This shapes what happens in the ‘transformation phase’ after a contract is won, if time and resources are not dedicated to solution design.

In the absence of this consultation the transformation teams will refer back to the bid documentation and probably spend too much time putting systems and processes in place to deliver the prescribed generic model rather than take time to really engage with the client and listen to their needs. Consequently, post-contract award dialogue is frequently missing.

Our solutions

McKinsey & Company’s report, False Summit: The State of Human Capital (October 2012) contained the following suggestion:

The Human Capital function needs daring to create real and lasting change in how top talent is recruited, engaged and retained.

1. New approaches for developing creative business solutions which go beyond traditional RPO models

Organisations must take more time to evaluate their aspirations for resourcing and where their current models position them against these aspirations. This information should be used to shape conversations about contractual models and how solutions can be tailored to meet the needs of the business and of individual business units.

These approaches need to be more methodical and analytical, so that good practice happens as a result of planned strategies and tactical actions with clearly defined metrics and predicted outcomes. This means developing division-specific solutions and, perhaps more importantly, spending more time discussing the needs of different parts of the business. This way, tactics can be developed to meet requirements that diverge from the norm and new, innovative practices introduced to realise particular outcomes.

2. Professionalisation of the RPO industry

We hear what the sector is saying about the quality and competency of staff and concede that in contracts where the margins are tight there is always a need to balance the cost of staffing the operation against the predicted margin. However, we believe there are wider issues at play here: the overall quality of staff across the industry. Part of this is to do with the fact that there are limited professional qualifications in resourcing and many individuals stumble into the industry by accident rather than design.

Resourcing is possibly in a similar situation to that of project management 10-15 years ago. Businesses are recognising the ‘mission-critical’ role of resourcers but the lack of professionalism in the sector makes it difficult to find people capable of delivering high quality, strategic solutions. There is a need for the sector to work collectively to develop more industry-standard qualifications and development pathways.

3. Introduction of a solutions development team

The standard staffing model – which involves operational recruiters ‘on the ground’ at the client organisation and centralised specialists – results in a lack of strategic and innovative thinking in day-to-day operations, which is precisely where innovation and creativity is required. As well as upskilling on-site teams, we need to identify bridging mechanisms that place central expertise at the heart of day-to-day solutioning.

A dedicated solutions development team would offer clients advice on emerging technologies and innovative solutions. Using an information cascade from the central team through account directors and account managers would allow people on the ground to keep up with innovative developments and technologies. It is also possible to partner with specialist providers to secure the right solutions. Many of the newest innovations have originated outside of resourcing.


4. Moving resourcing up the value chain

As the first resourcing business in the UK to secure the BS 11000 partnering standard, we fully understand the challenges of building and maintaining relationships with our clients and other stakeholders in the resourcing process. We do not underestimate the time and resources it takes to develop relationships and build trust.

There are, however, some elements of governance which are outside of the control of the RPO provider and require action from the client. Without clear channels of communication to and from the C-suite it can be hard to be creative and innovative in developing solutions or working outside of traditional cost models and business structures.

Educate senior managers

There is a need for senior managers to ‘champion the cause’ to effect meaningful change. It is clear that some of the senior resourcing professionals we spoke to recognise this and believe that part of the ‘dumbing down’ of resourcing as a business function stems from a lack of senior management understanding that human capital is a strategic asset.

A key challenge, therefore, is educating senior managers about resourcing and helping to move resourcing, as a discipline, up the value chain. It is arguable that outsourcing partners could play a role here in supporting resourcing professionals by demonstrating (through case examples and more proactive thought leadership) the value attached to better strategic management of resourcing.

Invest in better engagement

It’s important to understand the new challenges of engagement (multi-channel dialogue with both active and passive candidates which needs to take place without always producing immediate results):

The importance of investment in workforce planning (from a developmental/retention perspective and a recruitment viewpoint).

The role of the employer brand and EVPs (including linkages between product/service brands and the employment proposition).

While these things are outside of the direct control of RPO providers, without them some of the ‘innovative’ challenges outlined by managers in our survey cannot happen. It is not possible, for example, to pursue a strategy of engagement with passive candidates and brand building without an allocated budget for indirect communication. Similarly it is not possible to build talent pools and move towards models of zero-time recruitment if there is no workforce planning evidence on which to make decisions.

Strengthen the resourcer-client partnership

There are issues and challenges on both the supplier and buyer side of the resourcing landscape. We have yet to develop an approach which provides the potential for resourcing to move up the value chain to become a strategic business solution for optimising human capital. In many cases it is disconnected from wider thinking in terms of talent management and it is not always seen by senior executives as adding any real value to the organisation. We would like to see a new ‘model’ (or framework approach) which would enable suppliers and buyers to work together more effectively to raise the status of resourcing and give it the strategic position in the business it deserves.

Our model for resourcing innovation

The model proposed overleaf has at its core a newly defined contracting phase which unites the resourcer and client to develop the right business models before tender.

There is also a secondary phase of solutioning built in post-contract award to ensure that the approach is properly tailored to the needs of the client.

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The main delivery mechanism is divided into two parts:

1. An engine room of delivery which focuses on developing relationships with hiring managers and candidates. This part of the process is heavily reliant on having a properly skilled workforce supported by recognised qualifications and training. It relies on a continual feed of knowledge and information about new developments and innovations from the solutions design team and specialists and is able to introduce partner organisations to the client to effect innovation in key niche areas.

2. A strategic knowledge hub that supports branding, talent pooling and creative selection and assessment. This strategic unit (which is typically part of the central business hub of the RPO provider but not necessarily seen ‘on the ground’) needs to be costed in at the outset to ensure that the added-value benefits are fully realised.

Clients can purchase some or all of these elements. The model also works within a ‘blended solution’ where internal teams may be retained to deliver some elements with the RPO provider supplying teams of expertise to fill other aspects of the ‘delivery machine’ and ‘strategic think tank’.

All of the above is supported by flexible processes rather than rigid process maps which assume a one-size-fits all solution. There is also a clearly defined partnership management and governance approach. Better governance will also stem from having the ‘right’ management information which focuses on outcomes of the process (including quality of hire, candidate satisfaction, hiring manager satisfaction, strength of talent pools) rather than just the outputs.

Thought leadership and engagement with senior executives to support the development of human capital as a strategic asset

Contracting Delivery Support

Pre-engagement/ competitive

dialogue to design the business model

and solution

Tendering on value, outputs and quality

of experience (hiring manager and candidate)

Post-tender transformation phase based on

User-Centric Design approach/ tailored solution

High quality managers operating as solution design specialists. Qualified through the Academy and feeding on the knowledge

and expertise of the Solutions Design Team and specialists. Build effective relationships with hiring managers

Delivery ‘Machine’

Back-office processing team

supported by solid technology

platforms

Partner organisations

providing innovative solutions in niche areas

Resourcers building relationships with

candidates. High-touch approach

Continual horizan scanning and knowledge sharing to challenge ‘best practice’ and evolve the model. Working with the client to

ensure continued understanding of changing business needs and market forces

Strategic ‘think tank’

Brand champions who develop and

manage the dialogue through multiple

channels

Resourcing business partners providing creative support in

selection and assessment

Talent managers who build and

manage pools of talent in key

areas of demand

Supporting Processes

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Our conclusions

Although the findings of the research proved challenging reading, they have provided us with a much better insight into the disconnect between buyers and suppliers.

We are pleased that we didn’t pre-suppose what the sector might consider to be ‘innovative’, as the research has demonstrated that the buyer community think it has far less to do with technology and social recruitment (which are the things that suppliers typically allude to when talking about innovation) and much more to do with effective business models for providing strategic resourcing solutions.

End transactional costing to reach common goal

In essence, we both want the same thing: a high-touch customer-centred process (candidate and hiring manager) that adds true value to the organisation in terms of extending talent capacity. We are not so naïve as to think that we can achieve this with limitless resources, but transactional costing models are holding back the innovative and creative potential of both outsourced suppliers and in-house teams.

This cost-based culture is commoditising a business service which shouldn’t be a commodity: it should be a value-adding business function based on a consultative and solutions-based model. The real value, therefore, lies as much in the knowledge, expertise and solutioning (and ability to draw information on best practice from work with other clients and business partners across the whole provider landscape) as in the ability to generate scale economies and therefore reduce costs.

Professionalise and partner

We hear clients when they say that the quality of staff is not high enough to provide the advisory solutions being sought. While some of this can also be linked to transactional cost models, Capita should be championing professionalisation of resourcing as a career so that we can attract and professionally train the next generation of recruiters and resourcers.

Through better engagement and partnership development – commencing even before managers have put pen to paper to outline their requirements within a Request for Information document – there is scope to find a better solution and model that is more consultative, responsive, creative and innovative. The scope of what is possible will always be based on cost but there is already expertise within our business that can help organisations achieve some of the innovative solutions outlined by the resourcing managers in our survey. We simply need to find business models that allow us to put these strategic solutions at the centre of our service design rather than treat them as an ‘add-on’ to the conventional transactional model.

We are confident that through better partnership working we can effect a step-change in the development of resourcing as a strategic business discipline and we are excited by the challenge identified by this research.


Appendix

About the authors

Mike Ruddle

Mike has worked in the recruitment industry for 15 years for several market-leading staffing organisations in the UK and globally, with a specific focus on the MSP/RPO sector since 2002.

He has consulted with HRD and board-level sponsors within many large private and public sector organisations to design and implement tailored strategic staffing solutions, encompassing a broad range of MSP, RPO and blended recruitment outsourcing programmes.

As part of the senior leadership team, Mike is ultimately responsible for the direction of strategic business development including new client acquisition, talent consulting, thought leadership, and new product and service innovation.

Kate Harper

After 10 years working at the University of Bradford as a lecturer in International Business and European Management and chair of its part-time MBA, Kate embarked on a career in resourcing as a research-led consultant.

After working for Havas People (formerly Riley) and Tribal, Kate set up her own business, CEH Works Solutions, which focuses on supporting organisations in improving their resourcing and talent management. Her research and consulting experience covers a broad range of resourcing themes including employer branding, workforce and talent planning and skills mapping, and her projects have involved working with employers, their staff, candidates and outsourced partners.

Kate has helped a variety of in-house and outsourced resourcing teams across the private and public sectors to optimise their business models. She has developed a sound knowledge of best practice in resourcing and talent management business solutioning.

Contributors

We would like to thank contributors from the organisations listed below:

Arup BskyB The Cooperative Banking Group Thales Vodafone Virgin Money Lockheed Martin CareUK G4S British Telecom CH2M Hill Morgan Sindall Atos Ernst & Young Legal & General Ace Group KPMG Nationwide TalkTalk Barclays Sodexo