Offshore RPO 101: Benefits, Best Practices, and Challenges You Should Know About

• More and more US-based companies are relying on offshore RPO services because they offer a load of benefits, including cost-savings and faster turn-around times.
• Traditional recruitment still works, but it is no longer the most effective strategy, especially because it can be time-consuming and expensive.
• Before working with any offshore RPO company, it is crucial for businesses to ensure that the provider adheres with strict standards and follows the best practices of the industry.

Securing the right talent has always been crucial for the success of any business. However, industries are continuously evolving, so recruitment processes need to keep up. Traditional recruitment practices may still work, but they can be quite time-consuming, expensive, and geographically limited, so it isn’t a good idea for businesses to stick with this strategy alone. 

It’s a good thing that companies are starting to realize the advantages of working with offshore recruitment process outsourcing (RPO) companies. Offshore RPO is now being used by many organizations looking for ways to optimize their talent acquisition strategies.

Compared to traditional recruitment, offshore RPO is more cost-effective and efficient. However, if you’re still wary about this new strategy, learning more about it can definitely help. Read through the rest of this article today to learn how offshore RPO works and what are its benefits and best practices.

Traditional Recruitment Methods: Why They May Not Be the Best Option

Traditional recruitment methods have long been the standard, but they often fall short in the face of modern challenges. This leads to several problems, such as the ones listed below:

1. Time-Consuming 

Traditional recruitment methods are notoriously time-consuming and inefficient. Manually sifting through resumes, reviewing resumes and applications can be tedious, especially for large volumes of applications. This leads to delays in identifying qualified candidates, creating a domino effect and affecting other steps of the hiring process, including interviews and onboarding.

And speaking of interviews, traditional recruitment processes often involve multiple rounds of interviews. Candidates had to meet with different organizational stakeholders, further prolonging the hiring process, especially if all parties involved could not find a fitting schedule.

Another problem contributing to the time-consuming nature of traditional recruitment is the internal approval system many companies use.. Hiring decisions often require approval from multiple stakeholders, like hiring managers and senior leadership teams. Navigating these internal approval processes takes time and delays the final hiring decision.

All in all, a slow hiring process has a significant impact on an organization’s ability to fill roles quickly, especially critical ones, like C-level posts and senior-level positions. This can lead to decreased productivity and a competitive disadvantage.

Related Reading: How Recruitment Agencies Solve Hiring Problems for Employers

2. High Cost-per-Hire Rate

Traditional recruitment methods can be expensive because they involve a range of costs that can significantly impact an organization’s budget. These expenses include:

• Advertising and Job Posting Fees – Placing job advertisements on online job boards, digital publications, and other platforms (both digital and physical) can be costly, especially for some specialized roles in competitive markets. Indeed, one of the world’s most trusted online job boards, offers pay-per-click job posts, which can cost $5 per day per position. It might not be much, but it can accumulate over time.
• Internal HR Costs – Maintaining an in-house HR team solely for recruitment is a good idea for some of the biggest companies. However, it involves significant overhead costs, including salaries, benefits, and administrative expenses, which may not be cost-effective in the long run.
• Time Spent on Recruitment – The time spent on traditional recruitment activities, such as screening resumes, conducting interviews, and managing the hiring process, represents a significant opportunity cost for the organization.

If you have a high cost-per-hire rate, it will eventually strain your overall budget as an organization. It can limit your resources for other critical business functions and create a financial burden. Sooner or later, it can hinder your business’s ability to invest in other opportunities that lead to growth and innovation.

3. Unconscious Bias 

Traditional recruitment methods heavily rely on human judgment, which can lead to unconscious bias. It manifests in various ways, such as through:

• Affinity Bias – Recruiters are people, too, and it isn’t unlikely for them to favor candidates who share similar backgrounds, interests, or experiences. They may unconsciously like applicants who graduated from the same school or come from the same state. This limits the diversity in the workforce and hinders the potential for fresh perspectives and innovative ideas.
• Halo Effect – Halo effect can happen during traditional recruitment processes, too. This is exhibited when recruiters are influenced by a candidate’s positive attributes (such as a prestigious education, impressive work experience, or even a conventionally attractive appearance). This can lead them to overlook other important factors, like real skills and work ethic.
• Confirmation Bias – Some recruiters have prejudices (both positive and negative). In many cases, they actively seek out information that confirms their initial impressions of a candidate, and in the process, they end up overlooking contradictory evidence.
• Recency Bias – It’s not uncommon for people to give more weight to fresh information in their minds (and completely disregard older information). This can lead to recency bias, in which recruiters may favor candidates they interviewed last even if the other candidates exhibit better skills.

Unconscious bias can lead to unfair and discriminatory hiring practices. This can have a negative impact on an organization’s reputation, creating a less inclusive work environment. It also hinders your business’s capability to attract and retain top talents who come from diverse backgrounds.

4. Limited Access to Talents 

Traditional recruitment methods often struggle with a limited geographical reach because they primarily focus on local talent pools. They end up unnecessarily restricting the search to candidates within a specific area. This approach can hinder organizations from accessing a diverse range of candidates with varied backgrounds and experiences. 

The lack of global reach in traditional methods also poses a challenge in finding candidates in international markets. This can be detrimental to your organization, especially if you are looking to fill in specialized roles or positions requiring specific language skills. In many cases, you can find them in international job markets. 

The consequences of this restricted talent pool can be significant for your organization. The inability to access a diverse range of candidates may result in lower-quality hires and increased turnover rates. Without the ability to attract the best candidates for the job, organizations may experience a decrease in overall productivity and struggle to find the right fit for critical roles. 

5. Inaccurate Job Matching 

Traditional recruitment practices heavily rely on resumes. These documents may serve as the primary source of information about candidates, but they can never offer a comprehensive view of their skills, personality traits, and potential cultural fit into your organization. Relying too much on resumes can result in inaccurate job matching. It leads to candidates being hired for positions that may not align well with their skills, strengths, abilities, or interests. 

In relation to resumes, these documents often only emphasize past experiences and achievements. Just by looking at it, you cannot determine other essential hiring factors, like the candidate’s transferable skills, problem-solving capabilities, and career aspirations. Resumes also typically lack insights into behavioral traits, communication styles, and teamwork skills, hindering a holistic assessment of their suitability for a role. 

The repercussions of inaccurate job matching can lead to high turnover rates, decreased job satisfaction among employees, and reduced productivity. Furthermore, when candidates are not well-suited for their roles, it can negatively impact the organization’s culture and morale, leading to disengagement and potential conflicts within the team. 

Offshore RPO Services: How Do They Work?

If traditional recruitment practices are no longer effective for your organization, it may be time to check out other methods that can help you find the perfect candidates to fill your vacant positions. Offshore RPO might work for you! It involves partnering with an external provider located in a different geographical location (usually other countries) to handle your recruitment needs. 

Offshore RPO providers offer a range of services, including candidate sourcing, screening, interviewing, onboarding, and more. Their services are often tailored to meet your specific hiring requirements, so by taking advantage of their expertise and resources, you can access a broader talent pool and streamline your hiring processes.

Related Reading: The Keys to Success(ful Hiring): The Ideal Offshore RPO Services Provider

If offshore RPO is a particularly new concept for you, it’s important to understand how it works. Check out this quick guide:

1. Assessment of Your Needs 

The first step is assessing your organization’s hiring needs. This involves not just determining the vacant positions to be filled but also understanding the culture and specific requirements of your company. 

Reputable offshore RPO providers will invest time and effort in understanding the unique intricacies of your company. This ensures that they can provide a “personalized” approach to recruitment that aligns with your overall goals and values. 

2. Candidate Sourcing and Initial Screening 

Once your needs are clear, your offshore RPO provider will begin sourcing and screening candidates from their talent pools. They sometimes get several candidates through this method, especially for positions that aren’t in-demand and don’t require high-level skills. However, in some cases, they need to use a diverse array of sourcing methods, too, such as job postings, online databases, and extensive networks.

The good thing about experienced offshore RPO companies is that they have meticulous sourcing and screening processes. Qualifications and experiences of candidates are thoroughly scrutinized to ensure a perfect match for your organization’s requirements.

Related Reading: The Art of Hiring Smart: Best Practices in Candidate Screening

3. Interviewing and Selection 

The interview and selection process is a crucial stage in talent acquisition, where organizations strive to identify the most suitable candidate for a specific role. Offshore RPO providers excel in this area, as they employ a meticulous and comprehensive approach to ensure the best possible outcomes when hiring candidates. They conduct in-depth interviews, delving into candidates’ skills, experience, and qualifications, while also conducting thorough background checks to verify information and assess their suitability for the position.

This rigorous selection process goes beyond simply reviewing resumes and conducting basic interviews, too. Offshore RPO companies use a variety of methods to gain a deeper understanding of each candidate. These methods can include behavioral assessments, skills testing, and reference checks. By employing this multi-faceted approach, they ensure that only the most qualified and well-suited individuals progress to the next stage of the recruitment process. 

All in all, this meticulous approach minimizes the risk of hiring mismatches and lays the foundation for a successful recruitment outcome. In one way or another, it contributes to a stronger and more productive workforce.

4. Employer of Record (EoR) Setup 

Offshore RPO companies also offer Employer of Record (EoR) services. The EoR setup simplifies the legal and administrative complexities of employing new hires, particularly for companies expanding their operations globally. This setup streamlines the hiring process by having the RPO provider assume the role of the legal employer, handling tasks such as contract negotiation, payroll management, and ensuring compliance with local labor laws.

By delegating these responsibilities to the RPO provider, you can focus on your core business activities with the assurance that the intricacies of employment regulations are being managed effectively by a third party. The RPO provider also ensures that all necessary paperwork is completed, payroll is processed accurately, and tax compliance is met, ensuring a smooth integration of the new hire into the company’s workforce.

This setup does not only benefit you (the organization); it is also quite advantageous to your employees. Some countries have strict regulations when it comes to being employed remotely by a foreign company. With the EoR setup in place, they no longer have to navigate these legal requirements because they are essentially employed locally, too. It allows them to focus on their roles and responsibilities within the organization instead.

5. Talent Onboarding 

Talent onboarding is in the latter stages of the entire offshore RPO process. This step is necessary to ensure a smooth integration of new hires into the organization. 

If you request services from offshore RPO providers, you may have very minimal involvement in the talent acquisition process. However, it doesn’t mean that the onboarding process will be difficult for you. Your offshore RPO provider will offer the necessary support and guidance to facilitate a seamless transition and integration, ensuring that both parties (your new hires and your organization) will adjust quickly to each other.

Offshore RPO companies will coordinate with you regarding the orientation sessions, where new employees are introduced to the company. This is a way for them to get to know their workmates and understand the culture, values, and policies of your organization. It may take a while for the new hire to be fully integrated into your organization, but your offshore RPO provider will be with you all the way.

Also, with the EoR setup in place, your new employee no longer has to have a hard time navigating the labor laws of your country and the unique regulations of your state. This makes the transition and onboarding period even easier for your new hire.

6. Monitoring and Feedback 

The role of an offshore RPO company extends beyond the initial onboarding process. In many cases, they also provide ongoing performance monitoring services to support both your organization and the new employees they helped hire. This ensures a smooth transition and successful integration into the organization.

During this stage, the offshore RPO provider will actively monitor the performance of the new hires through a variety of methods. They will assess their progress and identify any potential challenges through regular check-ups with both the employee and their line manager. They will also collect performance data and conduct formal performance evaluations to determine if the new employee is actually getting their tasks done as assigned.

Through continuous performance monitoring and support, your offshore RPO provider can help foster a positive and productive work environment for both you and the new hire. In the long run, it can effectively contribute to long-term employee retention and organizational success.

Benefits of Offshore RPO Services

More and more USA-based companies are relying on offshore RPO services these days because they offer a lot of benefits. Here are some of the advantages you can enjoy by working with reputable offshore RPO providers:

1. Cost Savings 

Offshore RPO can significantly reduce recruitment costs, making it a compelling option for organizations looking to optimize their budgets. This cost-effectiveness is caused by several factors, like:

• Lower Labor Costs – Offshore RPO providers often operate in regions with lower labor costs, such as the Philippines. This translates to reduced recruitment expenses, allowing organizations to allocate budget and other financial resources more efficiently.
• Reduced Overhead Expenses – By outsourcing recruitment functions, you can eliminate the need for in-house recruitment teams. In the process, you can also effectively reduce your overhead expenses related to salaries, benefits, office space, and equipment. 
• Reduced Recruitment Software Costs – Some companies consider investing in sophisticated software to manage their recruitment processes. However, the cost of purchasing, implementing, and maintaining such computer programs can be quite substantial, especially for startups and smaller organizations. By partnering with an offshore RPO provider, you can leverage the provider’s existing software, allowing you to save a lot of money.
• Streamlined Onboarding Processes – Onboarding new hires can be time-consuming and resource-intensive because it involves a lot of paperwork, training, and integration into the company culture. Offshore RPO providers often have specialized onboarding processes that are streamlined and efficient, reducing the time and effort required for this crucial step. This can lead to cost savings in the long run.
• Reduced Advertising Costs – Traditional job advertising methods, such as posting on online job boards, can be expensive. Offshore RPO providers often have access to a wider range of sourcing channels, like their own industry network and talent pools, which can be more cost-effective for your organization. 

Related Reading: Talents From Across the Globe: How Offshore Staffing Transforms US-Based Companies

2. Access to a Wider Talent Pool 

Offshore RPO services can open doors to a more diverse talent pool. They allow organizations to tap into global talent markets and access a wider range of skills, which might not be available in the local job pool. This is particularly beneficial for companies looking for niche or specialized skills to fill certain roles.

For example, a company seeking a software developer with expertise in a unique programming language might find it difficult to find qualified candidates within their local market. What they can do is partner with an offshore RPO provider. This way, they can get access to a larger talent pool from other parts of the world, significantly increasing their chance of finding the ideal candidate for the job.

3. Expertise and Experience 

Reliable offshore RPO providers offer specialized knowledge and experience in recruitment processes, often exceeding the capabilities of in-house teams. They are experts at the job, so they possess a deep understanding of industry trends and best practices. In many cases, they are also adept in international and local labor regulations to ensure that they aren’t breaking any laws while finding the perfect candidate for their clients.

Additionally, offshore RPO companies often already have access to a large network of talents within different fields. This allows them to source high-quality candidates faster and more effectively. It can also significantly improve the recruitment process and result in hiring better employees.

Related Reading: How Sysgen RPO Helped a US Consulting Firm Build a Remote-First Dream Team

4. Faster Turn-Around Time 

Time is always of the essence when it comes to hiring employees and filling specialized roles. The good thing about using offshore RPO services is they can help you find the right workers at a faster rate compared to relying on an in-house team. This is possible for several reasons, such as:

• Streamlined Processes – Offshore RPO companies often have established processes to make sourcing, screening, and interviewing candidates more efficient. Sometimes, they make use of new technology and tools to automate tasks and optimize workflows, eliminating the need for manual processes, and reducing bottlenecks, leading to a faster time to hire. 
• Access to a Wider Talent Pool – Since offshore RPO companies have access to a global network of candidates, they can quickly identify and reach out to qualified individuals as soon as the need arises. They are also not limited by geographical locations, making it easier for them to find candidates with specialized skills.
• Time Zone Advantages – Offshore RPO providers often operate in different time zones, allowing them to work on recruitment tasks while your in-house team is not available. This can significantly shorten the time it takes to complete certain tasks, like screening applications, leading to a faster overall hiring process. 

5. Scalability and Flexibility 

Another good thing about offshore RPO is that providers offer a flexible and scalable recruitment solution. It allows you to adjust your recruitment capacity based on your changing business needs. 

This is particularly advantageous for companies experiencing periods of rapid growth or fluctuating hiring requirements. Offshore RPO providers can quickly scale their teams up or down to meet the evolving needs of their clients.

Best Practices for Offshore RPO Services

You may be excited to call offshore RPO companies and request their services. But before you do, be sure that they adhere to these best industry practices:

1. Establish Open Communication Lines 

Effective communication is the cornerstone of any successful partnership, and this is particularly true for offshore RPO providers. Open and transparent communication channels are essential for building trust, understanding expectations, and resolving any issues that may arise. 

Here are some communication aspects that your offshore RPO provider should cover:

• Regular Communication – Establish a clear communication plan, outlining the frequency and methods of communication. This could include regular meetings, email updates, and progress reports.
• Clear Communication Channels – Designate specific communication channels for different types of information to ensure that messages are delivered promptly and efficiently.. You can use email for project updates and candidate feedback, instant messaging for urgent matters, and more. 
• Active Listening – Encourage active listening and ensure that everyone feels heard and understood. This involves paying attention to their concerns, providing timely responses, and demonstrating your willingness to address their needs.
• Transparency and Accountability – Maintain transparency in all communication. Be sure that clients are provided with regular updates on the progress of the recruitment process and any challenges encountered. This builds trust and ensures that clients are informed decision-makers.

2. Define Clear Performance Metrics 

Offshore RPO providers must deliver value to their clients. And to ensure that, it’s crucial to establish clear key performance indicators (KPIs). These metrics provide a quantifiable way to track progress, identify areas for improvement, and demonstrate the effectiveness of the partnership.

Some common KPIs for offshore RPO companies are:

• Time-to-Hire Rate – This metric measures the time it takes to fill open positions, from the initial posting to the start date of the new hire. It reflects the efficiency of the recruitment process and the provider’s ability to meet the organization’s staffing needs.
• Cost-per-Hire Rate – This KPI tracks the overall cost of hiring a new employee, including advertising, screening, interviewing, and onboarding expenses. This metric helps assess the cost-effectiveness of the recruitment process and identify areas for cost optimization.
• Candidate Quality – This will evaluate the overall quality of candidates presented by the offshore RPO provider to the client. Factors such as experience, skills, and cultural fit will be considered. This metric helps ensure that the provider is delivering high-quality candidates who meet the organization’s specific requirements.

3. Promote Cultural Sensitivity 

Offshore RPO often involves working with teams located in different regions and cultures. To ensure effective communication and collaboration, it’s crucial to promote cultural sensitivity and understanding through:

• Cultural Training – A trusted offshore RPO company invests in cultural training for team members. Proper training equips them with the knowledge and skills to navigate cultural differences in communication styles, work ethics, and business practices. This helps foster a more inclusive and respectful work environment.
• Mindful Communication – Offshore RPO companies must also encourage team members to be mindful of cultural nuances in communication styles, such as language, tone, and body language. This helps avoid misunderstandings and promotes effective communication across cultural boundaries.
• Building Relationships – It is advisable, too, to foster strong relationships with clients and team members from different cultures, demonstrating respect and understanding for their perspectives. This helps build trust and create a more collaborative and productive work environment.

Related Reading: Building a Great Company Culture to Fuel Your Recruitment Needs

4. Build a Strong Talent Network 

Offshore RPO companies understand the importance of building a robust talent network to effectively meet their clients’ staffing needs. This network serves as a valuable asset, allowing them to swiftly identify and present top-tier candidates for various roles. One key aspect is maintaining a comprehensive candidate database that includes detailed profiles of qualified individuals, encompassing their skills, experience, and contact details. Regular updates and continuous enrichment of this database ensure that the provider has access to a diverse pool of talent.

In addition to database maintenance, active sourcing can also play a vital role in talent acquisition for offshore RPO companies. By proactively seeking new talent through various channels such as online job boards, social media platforms, industry events, and professional networking groups, these providers can ensure a steady influx of qualified candidates. This proactive approach enables them to stay ahead in the recruitment process and swiftly respond to their clients’ staffing requirements.

5. Ensure Data Privacy 

Ensuring the security and compliance of sensitive personal data is a top priority for offshore RPO companies. This is especially crucial because they handle candidate information, employment records, client data, and other sensitive information. To safeguard these pieces of information, offshore RPO companies must adhere to stringent data security measures and regulatory requirements. 

Implementing robust data security policies, including encryption, access controls, and regular security audits, would be crucial in protecting sensitive data from unauthorized access, alteration, or corruption. Compliance with data privacy regulations is also essential to ensure that data protection measures are in place and that individual consent is obtained before collecting and processing personal data.

6. Find a Common Schedule Amid Different Time Zones 

Significant time zone differences can make communication and collaboration challenging, so finding a common schedule is crucial. This involves careful planning and flexibility to ensure that both parties can effectively connect and work together. Here are some helpful tips that might work:

• Flexible Scheduling – Establish flexible scheduling arrangements that accommodate the different time zones involved in your work processes. This could include holding meetings at times that are convenient for all parties. This may also involve utilizing (and investing in) asynchronous communication tools.
• Clear Communication Protocols – Develop clear communication protocols that outline the preferred methods of communication, response times, and escalation procedures. This ensures that messages are delivered promptly and efficiently, despite the time zone differences.
• Technology Tools – Utilize technology tools that facilitate communication and collaboration across time zones. Invest in video conferencing platforms, instant messaging apps, project management software, and other tools that can bridge the gap and ensure that teams can work together effectively, regardless of location.

7. Regularly Review Processes 

Offshore RPO providers should understand the importance of continuous improvement to enhance the efficiency and effectiveness of their services. Conducting regular reviews of processes is essential for identifying areas that require enhancement. By evaluating the effectiveness of existing processes, determining bottlenecks, and exploring innovative technologies and strategies, offshore RPO companies can streamline their operations and deliver optimal results. 

Process mapping plays a crucial role in this process, too, because it enables offshore RPO companies to visualize the flow of work, identify inefficiencies, redundancies, and areas for improvement. Creating detailed process maps is crucial in streamlining workflows, optimizing resource allocation, and enhancing the overall efficiency of work operations within the organization.

Sysgen RPO: How Our Team Can Help You

Offshore RPO offers numerous benefits for organizations looking for ways to streamline their recruitment processes and access a wider talent pool. However, it’s crucial to partner with experienced and reputable providers. Choosing the right offshore RPO partner can make all the difference in achieving your talent acquisition goals.

At Sysgen RPO, we understand the complexities of offshore RPO. We are also committed to providing our clients with the highest level of service and support. Our team of recruitment specialists will work closely with you every step of the way to ensure that you are hiring the right candidates and maximizing your investment in talent acquisition. Reach out to our team today for more information.

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