In a tight labor market, it is critical to have a highly effective talent acquisition (TA) team and comprehensive strategy to engage and hire the best candidates for your organization. And as more companies look to outsource this function to get better results, a few questions arise: What’s the difference between a recruitment process outsourcing (RPO) provider and a staffing agency? Why do organizations choose RPOs over staffing agencies and vice versa?
A major difference between the two is the level of engagement and commitment they provide organizations. RPOs take a more hands-on role, positioning themselves as a long-term partner rather than a more transactional vendor. They work closely with HR teams to customize a strategy that fits an organization’s specific needs. In addition, RPOs offer a wider range of capabilities that include technology solutions, employer brand, candidate experience, and a total talent approach.
Unlike staffing agencies, RPO recruiters are dedicated to filling open requisitions for one organization, and in most cases, they recruit as that company. RPO recruiters interact with candidates under their client’s brand, not as an external organization — resulting in candidates receiving an on-brand experience from the hiring organization.
While both staffing agencies and RPOs can help organizations engage and hire talent, they are vastly different in scope, approach, and overall impact. So how do you know which is right for your business?
When considering your options, ask yourself these three questions to determine whether your needs are best addressed by an RPO or a staffing agency:
1. Are you looking for a few hires or to evolve your hiring strategy?
The first question is the easiest to answer. Are you having trouble filling a particular role, and you need some help to find the right candidates? Or are you looking to reshape the way your organization approaches recruitment entirely or for specific job families?
If your answer is the first option, a staffing agency is likely best for you. One-off hires and other more temporary fixes are best left to staffing agencies that may already represent candidates in a specific field.
If you’re looking to reshape your strategy for filling your talent pipeline, partnering with an RPO is a better fit. RPOs integrate more directly with your business to understand your company culture, establish long-term goals and evolve your talent acquisition strategy to meet both short- and long-term objectives. RPOs don’t come and go to fill one or two open positions — instead, they help build a sustainable solution to get your unfair share of talent. Understanding what you want from a talent acquisition partner — especially in terms of the duration and objectives of your relationship and the commitment involved — is key to determining if an RPO or staffing agency is right for your organization.
2. Do you want a more transactional or collaborative relationship?
Another aspect to consider is the nature of the relationship you’d like to have. Staffing agencies tend to have more transactional partnerships — send them a role you’d like filled, and a staffing agency provides candidates to interview. This is often a good solution for niche roles, as staffing agencies may specialize in specific candidate skill sets.
RPOs require a more collaborative relationship since they function as the talent acquisition arm of your own organization. An RPO shouldn’t be perceived as a vendor — it’s a partner that works closely with your team to understand your business to establish new processes and tools and achieve desired talent outcomes. This is not a short-term or low-effort investment, but one that requires a commitment on both sides to ensure success. If you’re looking for a set-it-and-forget-it situation, an RPO is likely not for you. But if you’re looking to use the strength, expertise, and insights of a team that can drive long-term change for your business, you might need more than a staffing agency.
3. Are you willing to be a champion for change?
The decision to use an RPO is a significant investment for decision-makers, and talent leaders should be prepared to blaze new trails. Outsourcing your talent acquisition for a few hires is much different in scope than partnering with an organization to evolve your recruitment strategy. If you’re ready to make a real difference for your organization, an RPO is right for you.
Since an RPO is ultimately an extension of your talent team, trust and flexibility are key. Establishing trust with your partner and allowing time to launch and stabilize new ways of working are critical to the success of outsourcing your talent acquisition. Seek a provider who understands and shares your values.
When it comes to talent acquisition, you have more options than ever. Staffing agencies and RPOs alike can be excellent resources for your company. Knowing your short-term and long-term goals, your expectations for a partner and your comfort level with leading through change can determine which is the right fit for you.
About the author: Tara Cassady, is Executive Vice President, at Cielo.