Risks involved in Resume Process Outsourcing
The HR outsourcing market, when inaugurated attracted a lot of media attention as
many of the first-generation contracts did not go as planned.Now the industry has introduced the
second-generation which is Recruitment Process Outsourcing (RPO). This too, now faces a new set of risks.
Research and studies on the scenario has shown the following:
- The number 01 risk today is in choosing the right provider. It is vital that they buyer studies the standards of the provider well, before accepting. The provider should be able to deliver and be able to stay long term. They should be financially stable and not burdened by work from other clients. Since this has not been given full attention, records show the failure of a great number of RPO and HRO schemes. It is equally important that the buyer fully understands the difference between various methods and approaches that are used today. This will help to maintain quality and with this technical “know-how”, the buyer will be able to manage the provider perfectly.
- Management of expectations has failed on both sides – buyer and provider. There needs to have a thorough understanding of the software solution, right at the inception – before purchase. Both parties should have a clear view of the hundreds of transactions that will take place, the time period for these transactions and what type of problems may arise. This has been one area that has been overlooked and which was the cause of failure.
- Another reason for failure is that RPOs are not fully skilled to meet the buyer’s expectation. This was clear at the first-generation level. For example, some first-generation HRO deals required recruitment in the scope, but the provider lacked recruitment process outsourcing expertise, and some handed this over to a third party, and eventually realized this was not feasible. Here is the third risk – RPOs and HROs are not fully competent to meet the buyer’s delivery model.
- The latest risk in the second-generation RPO deals is that buyers now being more educated with the experience of the first-generation deals have much higher expectations of the delivery model. Buyers now want providers to take on all risks associated with their employment/recruitment needs. These new demands are beyond the capacity of the RPO. Such demands will have a great impact on the ROI and the success of the outsourcing relationship.
Given below, in table-form are the “RPO Top 10 Potential Risks” by Jason Krumwiede, an Advisor in HR. He says, RPO can be tricky and risk prone – it will look good on paper, but when you peel it back, it may be best to keep it in-house.
http://aonrpoconsulting.wordpress.com/author/jkrumwie/
Let us have a look at these risks and consider the possible alternative:
Top 10 RPO Risks
| Risk | Description | Implementation Stage | Severity of Risk | Mitigation Strategy |
| Vision | Lack of clear definition of the end state | All Stages | High | Clearly define the degree of change and what isn’t changing |
| Implementation Plan | Slow and disrupted implementation | Pre-Transition | Medium | Robust, detailed, and integrated implementation plan |
| Leadership and Sponsorship | Lack of sufficient support to ensure successful implementation and adoption of the change |
All Stages | High | Leadership-driven change campaign that includes case for change and continuous communication |
| Productive employees | Workforce capability and confusion | Transformation | Medium | Comprehensive training and education for all levels (skills, processes, and behaviors) |
| Customer and Performance Expectations | Performance and quality problems | All Stages | High | Metrics and monitoring to mitigate risk |
| Engaged stakeholders | Disconnected employees and customers | All Stages | High | Audience-appropriate communication strategies and tactics timed in successive stages to meet evolving needs |
| Competing Initiatives | Lack of sufficient resources to implement on time and within budget | Pre-Transition, Transition | Low | Prioritize and commit to the initiative—not flavor of the month |
| Employment Practices | Employee resistance to use new hiring practices and procedures | Steady State | Low | Deliver and Communicate new recruiting playbook to fields customized to various audience |
| Data Management | Disconnect and inaccurate applicant data | Transformation and Steady State | Low | Effectively integrate the data of all 3rd vendors with ATS and other key systems |
| Regulatory | Workforce actions to right to unionize (e.g., Lilly Ledbetter) | Steady State | Low | Seek HR or employment law on the potential impact of new hiring process and changing employment laws |
The advantages in using an in-house application for Resume Analysis
- It is web-based solution that can be easily accessed over a Internet connection using a Web Browser
- It can scan thousands of resumes per hour and automatically extract key information into a database which could be accessed at any given time
- It is cost-effective when compared to man power
- You own all hardware, servers, power-systems, back-up systems, communications and other infrastructure at your location. This alleviates the risk of the third-party’s involvement
Based on the levels of risk that is involved with RPO providers, it is far advantageous to have your own in-house application for Resume Analysis. A Self- Hosting Software Deployment for the effective management of HR is eConn Resume Parser Software Solution. This is the answer to simplify and expedite resume processing efficiently, cost-effectively and in a timely manner.