Exactly What Does Quality Mean in the RPO Space?
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1. The study examined what quality means in the context of recruitment process outsourcing (RPO) through surveys and interviews with HR professionals. 2. Key findings include that quality RPOs educate clients on quality of hire metrics, ensure a strong cultural fit, foster innovation, and are responsive which impacts contract renewal rates. 3. The most important components of quality service are meeting recruiting metrics efficiently and managing processes well. These best distinguished quality from non-quality providers.
Exactly What Does Quality Mean in the RPO Space?
- 1. A WilsonHCG and HRO Today Magazine Study Exactly What Does Quality Mean in the RPO Space?
- 2. 2 Copyright 2015 SharedXpertise Exactly What Does Quality Mean in the RPO Space? Ask a person on the street what quality means, and you’ll get a variety of answers. Craftsmanship. Performance. Reliability. Good answers, but they beg for follow up. Ask an HR exec what recruitment process outsourcing (RPO) quality means, and you’re likely to hear about service—how well their provider met their recruiting needs. But that still leaves a lot of questions unasked. Because WilsonHCG has the highest raw scores in quality in the industry, HRO Today wanted to know how they are achieving quality and ask HR professionals what they think about quality in the RPO space. Specifically, we wanted to know the following: • What exactly does quality mean in a context of recruitment process outsourcing? • What are the most important components of quality? • What are the key drivers of satisfaction? • What distinguishes quality service from run-of-the-mill or mediocre service? • What roles do innovation and cultural fit play in perceptions of quality RPO service? We already had a head start on the answers. Each year, HRO Today’s RPO customer satisfaction surveys (the industry leading Baker’s Dozen) demonstrate the relative importance of staffing operations on satisfaction. Would an additional study that focuses on staffing operations uncover components that have a greater impact on satisfaction than others; if so, to what extent? Here’s how we got our answers: HRO Today Magazine and WilsonHCG began a study on April 17, 2015. Survey invitations were sent to readers of HRO Today Magazine and HRO Today newsletters. We screened invitees so only those currently using an RPO provider participated. In total, there were 155 usable responses. Some respondents offered particularly insightful comments on matters of quality, innovation and cultural fit. We followed up by conducting six in-depth interviews, asking the respondents to elaborate on their comments. Our results follow. Where appropriate, we’ve com- pared those respondents who consider their RPO as providing quality service with those who don’t. Background
- 3. Copyright 2015 SharedXpertise 3 HRO Today’s Baker’s Dozen Customer Satisfaction Ratings for RPO show each year that RPO providers who effective- ly manage staffing operations are ranked higher on overall account satisfaction than those who don’t. This study digs deeper and looks at how each component of managing staffing operations impacts how HR professionals perceive RPO quality. Key driver analysis was conducted so we could examine the relationships between the variables of quality and the indi- vidual components of staffing operations. To facilitate comparisons and analysis, we segmented one group of HR pros who perceived their RPO as providing quality service, and another group that didn’t, and they become for our purposes the “quality” and ”non-quality” groups. Here is what we found: 1. A quality RPO educates clients on the importance of quality of hire metrics and applications. Those with quality RPOs value all applications of quality of hire greater than those without quality RPOs. Quality isn’t fully realized and in- novation is hampered unless the RPO is offering proactive solutions and advice. Further, both innovation and proactivity in suggesting solutions speak to enabling change, instead of just sticking with the status quo. This suggests RPOs need to explain why HR practitioners should care about specific metrics, and what these metrics can do for the business. 2. The issue of “cultural fit” is crucial. When asked to rank account management factors, both the quality and non-quality groups ranked the same items in the same order of importance (how they felt about how their RPO provid- ers delivered was a difference). However, one item stood out: cultural fit. The quality group ranked this factor higher than the non-quality group. This finding was confirmed during follow-up interviews. 3. There is a clear connection between quality of service and innovation, particularly among those that feel they have quality RPOs. When we look at all respondents, nine out of 10 (89.1 percent) cited a connection between quality of service and innovation. Breaking down these numbers, we see that 93.1 percent of respondents with quality RPOs made this connection, compared to only 78.6 percent of respondents with non-quality RPOs. The interviews tell the same story. 4. Responsiveness was ranked the highest of the elements examined when considering contract renewal. How much of an impact does the perception of quality have on contract renewal? Quality is critical. Study results show that 83.3 percent of those who believe they have a quality RPO agree they are likely to renew their contract, compared to only 14.3 percent of those with a non-quality RPO. 5. The components of staffing operations with the greatest predictive relationship with RPO quality of service are meeting specific goals of recruiting metrics and efficient management of processes. In other words, did you hit the numbers, and did you do so without making a mess? Not only do positive answers here demonstrate service quality, they are also the best distinguishers between quality and non-quality providers. Meeting the metrics and doing so efficiently are the two areas where there was the highest gap between those HRO professionals who saw their provider as offering quality service and those who didn’t. Thus, these two elements are strong components of either customer satisfaction or customer frustration. Conclusions
- 4. 4 Copyright 2015 SharedXpertise Exactly What Does Quality Mean in the RPO Space? 6. RPO providers should be wary of the post-honeymoon period of a contract. Quality of service and overall sat- isfaction typically starts off with a two-thirds positive rating. In many cases, this rating dips at some point after three months, and then remains flat or decreases until about 18 months. After that time, the ratings generally increase once more. Therefore, RPOs must be diligent to manage expectations before and during the inevitable post-honeymoon period. 7. Perception of quality in account management has three main drivers. “Trust in the account manager,” “Adapts well to changing business needs,” and “Proactively suggests solutions.” The account manager is of course the face of the RPO; as such, that person’s performance is highly important (4.51 of 5.00) in how HR officers perceive quality of ser- vice. If that person is flexible in meeting client requirements and is engaged to offering suggestions for improvement, an HR officer is likely to perceive the RPO itself as offering quality service. 8. Quality RPOs distinguish themselves by effectively using the functions of the applicant tracking system. Great technology doesn’t do a lot of good if people don’t use it. Those with an applicant tracking system (ATS) were signifi- cantly more likely than those without one to rate their RPO quality as “Good” or “Excellent.” In fact, 73.3 percent of clients using an ATS reported favorably about their RPO, compared with 52.9 percent who didn’t use an ATS. But that’s not the whole story: The RPO has to be knowledgeable about the functionality of the system, as respondents who said their RPO was knowledgeable about the ATS system were 28.5 percentage points more likely to report a qual- ity experience with the RPO than those with a non-quality experience. Satisfaction with Human Resource Information System (HRIS) integration with the ATS is also much higher among those with quality RPOs. 9. Requisition development with hiring management is among the most important services for those with quality RPOs. Conversely, the service is not entirely appreciated by those without quality RPOs in terms of importance. This suggests that some RPO providers do a better job of setting expectations upfront—and that offers a yardstick for clients to measure performance against. But a vague standard, as with the non-quality group, leaves clients uncertain of what counts as good service and what doesn’t. Bottom line: This report shows that quality goes beyond service levels and KPIs to encompass responsiveness, innova- tion, proactive suggestions and having the right cultural fit. Quality isn’t just about doing what’s expected—it’s about moving beyond the status quo to deliver meaningful, lasting value to each client.
- 5. A WilsonHCG and HRO Today Magazine Study Want to read the whole report? Click here!