What Is The Difference Between RPO And BPO?
Updated: Apr 25, 2022
Hiring managers and business executives are always saddled with the task of optimizing the talent acquisition and hiring process to help their organizations achieve more flexibility and competitive advantage. This has made many organizations embrace outsourcing as a more attractive strategy for companies looking to achieve their business objectives.
With the popularity of outsourcing, terms like RPO, recruitment process outsourcing, and BPO, business process outsourcing, have also become more popular, and are now often used interchangeably. So, what is RPO in recruitment? How does RPO work and how does it relate to workforce planning? What is the difference between RPO and BPO? We’ll beam the spotlight on these and similar questions in this article.
What Is an RPO? - Recruitment Process Outsourcing
RPO, recruitment process outsourcing, is the business practice of outsourcing partial or full responsibility of a company’s recruiting and hiring-related needs to an external specialist.
In some sense, the RPO is a type of business process outsourcing, BPO, considering BPO itself has to do with outsourcing specific functions and services of a business to a third-party provider. However, the evolution of today’s current employment market means that recruitment process outsourcing RPO providers, as well as their RPO solutions, now have core benefits and objectives that are slightly different from BPO’s.
Types of RPO services
There are four common recruitment outsourcing RPO models, classified based on the nature of RPO services included in each of the different RPO engagements. These include:
On Demand RPO: Best for organizations in constant flux with volatile hiring needs. RPO models like this help manage spikes and rapid changes in hiring needs.
Project RPO: Project RPO providers are usually needed for specific business initiatives, contracts, launches, and similar business objectives where project RPO solutions might be needed for a specific project with a plan to continue with internal recruiters after the completion of such projects.
Hybrid RPO Models: This RPO model blends both RPO and MSP, managed service provider needs to manage both permanent recruitment needs as well as the entirety of the contingent workforce.
Enterprise/Full-Service RPO: Full-service RPO providers offer end to end RPO solutions from candidate sourcing to screening, interviews, employer branding, assessments, and more.
With the right RPO solution, businesses can easily access and deploy scalable RPO services based on their specific recruiting needs.
How does RPO work?
(Core goals & benefits of RPO solutions)
Recruitment process outsourcing RPO providers work as an extension of your organization.
This third-party provider helps extend your company’s recruiting capabilities by streamlining your recruiting processes and leveraging best-in-class recruitment technology to help your organization access a full spectrum of its recruiting needs while increasing the recruiting effectiveness of the hiring processes of your talent acquisition team.
An RPO service provider recruitment process outsourcing solution provides value added services that can be tailored to handle anything from candidate sourcing to candidate screening, interviews, management compliance, employer branding, onboarding, or even entire recruitment processes. Along with core cost savings advantage, recruitment process outsourcing RPO programs provide the organization a strategic partnership that optimizes the recruiting process;
Achieve greater flexibility and competitive advantage in a tight labor market
Find the right talent/qualified candidates quickly in a shorter time to hire
Improve candidate engagement, candidate experience, and employer branding
Attract a higher candidate quality that is often recruited in a more cost effective solution
Access modern recruitment technology implementation such as AI and machine learning, among others that are often out of reach for the average organization.
Access talent analytics and leverage real-time reporting to improve recruiting processes and make informed business decisions.
Manage the recruitment process to boost talent pipelines targeting top talent deploying scalable teams while helping the talent acquisition function avoid being overly overstretched.
No matter whether it is an end-to-end solution, a specific project, permanent recruitment, temporary hiring, a team of recruiters working off-site, onsite, or in a hybrid model, the client can achieve a tailored RPO journey for hiring. This is achieved by the RPO provider becoming an extension of their employer brand allowing them to identify talent quickly and fill their open positions to hire the best talent.
What Is Business Process Outsourcing?
Understanding BPO Services
BPO defines practices that involve sub-contracting business-related services or specific functions/needs of an organization to a third-party vendor.
The term “BPO” was originally applied to soft drinks manufacturers who often need to outsource significant portions of their supply chain to external companies but now include almost any kind of service that can be outsourced to a third-party company.
Types of BPO services
There are two main categories of classifications for BPO services.
BPO services are either classified based on the type of services involved;
Back-office BPO, which involves internal tasks such as payment processing, order processing, quality assurance, etc, AND
Front-office BPO, which involves interacting with the company's clients and consumers such as marketing, customer support, etc.
OR, classified based on vendor location;
Offshore BPO - where services are outsourced to vendors in overseas countries
Onshore BPO - where services are outsourced to vendors in the same countries as the company access the BPO service, AND
Nearshore BPO - where services are outsourced to nearby countries such as a US company outsourcing a vendor in Canada or a company in the UK outsourcing a vendor in Ireland.
Categories aside, common types of BPO services include
ITES, Information Technology Enabled Services, covering the outsourcing of services such as technical support, service desk analyst, and support desk analyst services, among others.
RPO, Recruitment Process Outsourcing, covering entire or specific recruiting processes and hiring needs such as candidate sourcing, candidate screening, compliance, interviews, job advertising, employer branding, etc.
LPO, Legal Process Outsourcing.
KPO, Knowledge Process Outsourcing, etc
What Is the Difference Between RPO and BPO?
It would be a mistake to assume that an RPO is just another normal form of BPO.
While both RPO and BPO might look similar on the surface (and they are), they also have unique differences, to an extent, on deeper examination.Unlike BPO, RPO engagements are not just about reproducing similar results for different clients at lower costs using cheap off-shore vendors and service centers.
For BPO services, cost savings appear to be the major driver and benefit. This is a different thing entirely with RPO providers and RPO programs.
Unlike BPO, RPO engagements are not just about reproducing similar results for different clients at lower costs using cheap off-shore vendors and service centers.
More attention is placed on streamlining the recruitment process to boost the quality of hires as well as the quantity of hires and time to hire.
Beyond just saving a few dollars here and there, hiring managers should understand that a good recruitment process outsourcing RPO provider provides the client with advantages for outsourcing recruitment to quickly fill jobs.
An RPO provider is not only a BPO specialist; they can also assist recruiters with finding talent, as well as leverage modern and innovative recruitment technology with scalable infrastructure. Through the deployment of agile recruitment processes, the RPO solution delivers integrated recruitment solutions for driving quality, efficiency, and speed in a way that meets their specific needs.
This article was written by Consultant, Crystal Mano.