Performance Metrics Lacking Among Recruitment Outsource Providers

July 27, 2015 – Just more than half (52 percent) of organizational leaders are satisfied with the data they currently receive from their recruitment process outsource provider, according to the ‘Measuring Up’ report released by Korn Ferry subsidiary, Futurestep, in conjunction with HRO Today. Low volume of data, accuracy of metrics, and alignment with business outcomes were specifically highlighted as problem areas by businesses monitoring performance metrics. Fully one third of respondents declared themselves neutral or unsatisfied with their RPO provider.

“Recruitment process outsourcing came into being about a decade ago as companies tried new and novel approaches to contain rising staffing costs,” said Scott A. Scanlon, founding chairman and CEO of Hunt Scanlon Media. “What strikes me most about this report’s conclusions is that important tracking metrics haven’t kept pace or evolved as the solutions themselves advanced. We now see HR customers looking for answers quite late in the game.”

While the findings emphasized the need for RPO vendors to go above and beyond to satisfy clients, the report warned of the importance of mastering basic analytics first and foremost: “Good metrics go hand in hand with good RPO and achieving this pointed to the promise of a successful long-lasting partnership between the RPO provider and client.”

The findings highlighted that given rapid changes in the sourcing and technology space in the recruiting industry, organizations need to partner with providers that can provide innovation to address ongoing continuous improvements.

Other key findings for understanding how metrics are used revealed several interesting statistics: “Time-to-hire” is an almost universal key performance indicator, with 87 percent of business using it; “source of hire” was voted the most useful (75 percent) performance indicator for evaluating RPO effectiveness; more than half, 57percent, of those not satisfied with their metrics complained the data does not link with other systems; and “increased quality of candidate pool” was the most desired metric businesses are not currently capturing at 44 percent.

The report revealed five recommendations to get the most out of metrics: a clear understanding of how HR aligns with business objectives is essential so decisions can be made in-line with the relevant metrics; a systematic approach must be taken, regardless of what metrics are employed; creating a single integrated information system is key; continuous innovation and improvement is imperative; trust is crucial to success — the quality of the relationship between client and provider and the extent to which sensitive data is shared and examined will determine a true partnership.

“It’s clear from this report there is still some work to do when it comes to analytics,” said Elliot Clark, CEO of HRO Today. “Continuous innovation and trust will make for an improved relationship, enabling success over a sustained period of time, but companies and RPO providers need to align metrics with business objectives from the outset to gather truly valuable data.”

“The whole point of metrics is to enable better decision-making, but the benefits of a true partnership can be felt beyond the realm of data,” said Jeanne MacDonald, president of global talent solutions at Futurestep. “The real key to long-term satisfaction is ensuring clients have a well-rounded talent acquisition strategy that helps them not only find the best talent but also nurture it for future growth.”

Contributed by Christopher W. Hunt, Executive Editor / Publisher, Hunt Scanlon Media

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