Offshoring RPO and why you should do it now

What is offshore RPO and why should you do it now?

Offshore RPO means handing part or all of your recruitment to a specialist team in a lower-cost country, and now is a strong time to start because governments, technology, and transparency all support it.

• Offshore RPO lets staffing firms pass repetitive hiring tasks to expert recruiters abroad.
• It frees your team to focus on core work and win more clients.
• As a result, firms that delay risk falling behind rivals who already offshore.

Offshore outsourcing is a growing trend across developed countries. Each country seems keen to build its own niche outsourcing market. Many now specialize in fields like information technology and recruitment.

At first, companies jumped on the offshore bandwagon before they had a clear hiring plan. However, that soon changed as firms grew more strategic. Offshoring of services moved “from an exotic and risky strategy to becoming a routine business decision“. In short, offshore outsourcing is now the new normal.

Offshored outsourcing: the new normal

Offshore outsourcing became the norm as leaders took a more holistic view. They looked at their core goals to capture the benefits and to cut the risks. So they defined the services to outsource and picked the best location for each one.

These activities began with IT infrastructure. Over time, though, firms learned to outsource business processes that sit outside core work. No matter how well a firm runs these tasks, they rarely add a competitive edge.

The trend grew stronger as firms got better at breaking processes into modules. As a result, they could split their activities and pass non-core work to an outside provider.

This trend now includes many of the world’s largest companies, with Asian countries leading as top offshore destinations. For a snapshot of the field, here is an infographic on the leading countries in offshore business services.

Statistics taken from AT Kearney

The infographic shows how big the global offshore industry has grown. It maps the landscape across 55 countries on three factors: financial appeal, people skills, and business environment. Six Asian countries sit in the top ten. So this proves how well offshore outsourcing performs in this region. The market is set to keep a positive trajectory. The Philippines’ offshore industry, in particular, has been called “unstoppable” by BussinessMirror.

Many business processes are now offshored. One sector making real noise is recruitment process outsourcing. In its early years, offshore RPO caught on with large and mid-sized firms as a way to focus more on core work. To see how the model matured, read this look at the recruitment process outsourcing sector.

Offshore RPO: now used by all types of companies

Human resources is a valuable asset for every organization. So firms invest big to hire top talent, which may be why offshore RPO caught on fast. Today, firms of every size use offshore RPO as a business strategy.

As more firms engage in offshore RPO, more providers have entered the market. In the past, only developed nations used it widely. Now, though, offshore RPO firms worldwide can deliver custom recruitment solutions to all kinds of clients. Many of these RPO services scale to fit each client’s needs.

Staffing firms are just one group that can gain from an offshore RPO engagement. As noted, non-core functions are better off outsourced. For staffing firms, virtual tasks such as sourcing of resume, screening of candidates, interviewing candidates, and VMS recruiting support activities are done more efficiently by offshore recruiters.

So what makes offshore RPO a must for staffing firms now?

Offshoring RPO: why you should do it now

Staffing firms often juggle a ton of recruitment jobs. Repetitive tasks eat their time. So they get pulled away from important core work.

These days, staffing firms lean on offshore RPO firms more than ever. Providers keep making their services faster, more reliable, and easy to reach. As a result, offshoring RPO is now a smart way for firms to get ahead of rivals. This kind of offshore recruitment also opens access to global talent.

There are many reasons to offshore your RPO. Still, why should you do it now? Here are the key factors to seize today.

The emergence of supportive government programs

Asian governments, in particular, back the offshore industry hard. They are opening up their economies to attract foreign investors. They also give incentives to multinationals to outsource to their countries.

For example, India gives tax breaks on IT-enabled service exports and treats IT as a top priority. In addition, it built software technology parks with modern IT and telecom facilities. These act as a “single window clearance” for all legal compliance. With both business and public sectors involved, India also works on wider bandwidth.

Meanwhile, the Philippines set up the Information Technology and E-Commerce Council. Its main goal is to develop the country as an E-service hub. The Philippine Cyberservices Corridor also launched to provide a range of BPO services. The government even funded training grants for BPO applicants.

The Department of Information and Communications Technology ran a training program on IT and business process management. Its aim was to raise the quality of the local talent pool.

Staffing firms that are not offshoring to these prime locations miss out. For example, they lose perks like tax breaks granted by governments. They also miss the more modern IT tools that offshore RPO providers offer. On top of that, they lose access to virtual recruiters who analyze data, build dashboards, and spot patterns for quick decisions.

Development of new technologies

Offshore RPO gives businesses effective recruitment solutions. New technology makes this possible. As the tools keep improving, these firms can offer even better, low-cost services.

Offshore RPO providers from Asia, such as India and the Philippines, keep improving cybersecurity. For example, India’s government has taken the initiative by implementing laws that strengthen the country against cyber attacks.

The Philippines, a major offshoring hub in Asia, has taken steps toward modern data protection too. During the IT & Cyber Security Forum, the country revealed digital government programs for stricter cybersecurity. The aim is to make the country a hub for local and offshore business.

Along with better data privacy, experienced RPO providers know social media is a game changer in hiring. So they have become social media savvy and can find passive top talent. Not every strong candidate posts a resume on job boards. In fact, many of the best do not. Still, they often have accounts, such as Facebook, that hint at their work history.

Small staffing firms have limited resources. Moreover, recruitment can involve a lot of data. So it helps a lot if the RPO firm supports cloud computing. This way, the staffing firm saves on hardware, data centers, software, and setup staff.

Cloud computing also improves teamwork through a shared, standard system. In addition, it boosts data security thanks to strong cloud protection. Sharing data on a cloud server even enables 24-hour activity. Firms under a VMS setup, where timing is key, find this very useful.

By outsourcing tasks like finding candidates and reading resumes, staffing firms save time. So they can focus on core work. While a foreign staffing firm sleeps, the RPO provider in the Philippines keeps recruiting. As a result, their combined effort roughly doubles the work done and adds recruitment velocity.

In short, firms that skip offshore recruitment lose these gains, from better data privacy tools to virtual recruiters and cost-saving cloud computing.

Increased transparency

In the past, it was hard to get details on offshore contracts and policies. Client employees often knew little about the technology, plans, or processes.

Now, though, providers work to be far more open. They share their policies, contracts, and pricing. So a high level of transparency keeps trust strong between the client and the RPO firm. As a result, partnerships work better.

Getting ahead of competition

This last reason pulls all the others together. Governments back the offshore sector. Technology keeps advancing through cloud computing, VMS recruiting, and social media. Transparency keeps rising too. So staffing firms have strong reasons to offshore their RPO.

This also means your rivals may already enjoy these benefits. By refusing to offshore part of your recruitment, you hand them a head start. It is not enough to just level the field. It is better to get ahead by partnering with the best RPO providers. Strong RPO cost savings can also reshape your hiring budget.

Final thoughts

Offshore outsourcing has come a long way, from little-known to a go-to strategy worldwide. Countries keep building their own niche markets to spur growth. This is true across the Asia Pacific.

Offshore outsourcing is now the new normal for many industries. In particular, the recruitment sector thrives under it. The strategy helps staffing firms most, since they run so many repetitive tasks.

By passing non-core recruitment to an offshore firm, your team can focus on growth and new ideas. For large staffing firms, offshore RPO helps manage huge candidate volumes, even under VMS recruiting. Many firms start by offshoring to the Philippines for its deep talent pool.

With governments supportive, technology fast-evolving, and transparency rising, staffing firms are well placed to offshore some or all of their recruitment. Those who do not may find themselves left behind by rivals who do.

Are you already offshoring your recruitment? What edge has it given you? Share your thoughts in the comments below.

This was originally published in Sysgen RPO website.

Sources

Lewin, A., Massini, S. and Peeters, C. Why are companies offshoring innovation? The emerging global race for talent. Journal of International Business Studies, 40(6), pp.901-925.

Precedence Research. Business Process Outsourcing (BPO) Market. Available at: https://www.precedenceresearch.com/business-process-outsourcing-market

Statista. Leading countries in offshore business services worldwide. Available at: https://www.statista.com/statistics/329766/leading-countries-in-offshore-business-services-worldwide/

BusinessMirror. Defending the PHL outsourcing industry. Available at: http://businessmirror.com.ph/defending-the-phl-outsourcing-industry/

Offshore RPO FAQs

What is offshore RPO?

Offshore RPO means outsourcing your recruitment to a specialist team in another country. The provider handles tasks like sourcing, screening, and interview support. So your in-house team can focus on core work.

Which tasks can I offshore to an RPO provider?

You can offshore sourcing, resume screening, candidate outreach, and interview scheduling. Many providers also support VMS recruiting and reporting. You choose how much to hand over.

Is offshore RPO only for large companies?

No. Firms of every size now use it. Small firms gain the most, since they get expert recruiters and modern tools without a big upfront spend.

How does offshore RPO save money?

It lowers labor costs and cuts spending on hardware, software, and data centers. Cloud tools and shared systems reduce overhead further. So you get quality hiring at a lower cost.

How do I choose the right RPO partner?

Check their track record, technology, and data security. Then confirm the services and pricing in the contract. A clear, transparent scope helps you avoid problems later.