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Recruitment Agency vs. RPO: Which is Right for You?

If you need to add new talent to your team in a hurry, what’s the first thing you do? Some companies have become very accustomed to working with staffing or recruitment agencies, while others have embraced the opportunities provided by recruitment process outsourcing (RPO) teams.

How can you know which method best meets your needs? Here’s a guide to the benefits of each and how you can tell if a recruitment agency or RPO is the right way forward for your business.

What is a recruitment agency?

Recruitment agencies specialize in putting people in place quickly but only for temporary job needs. While companies often have the option to bring on these temp workers for a permanent role, the initial agreement is that these workers will fill an immediate role, and just for a specific time. Note: you may also know recruitment agencies by other names, such as contingency agencies, staffing agencies, or temporary placement agencies.

How does a recruitment agency work?

Think of this staffing solution as a volume or bulk offering. They get paid to place, and not much more, so they will be looking to get your hire done as soon as possible. They may be paid on a per-placement basis, so if they don’t get you the right hire, they know someone else could. Because of this, the agency will have candidates already in their funnel for quick placement. 

When you go to a recruitment agency for a need, they should be able to get you that placement within days or a week—not weeks or months. 

Pros and cons of a recruitment agency

While it’s possible to get a great hire from these agencies, they specialize in quantity and speed, not necessarily quality. They exist to fill the spot right away., and they don’t work with you until you need them again. 

The negative is that they may not know your industry well. They may not have time to become familiar with your mission or employer brand. They rely on their existing knowledge of hiring quickly to get you the right person for the job and work independently of your human resources teams. If you’re looking for someone to assimilate to your company culture and work within your existing hiring methods, this isn’t the best choice. 

What is an RPO?

RPO stands for “recruitment process outsourcing.” The recruiters at these agencies are more of a strategic partner in hiring, and you can rely on them to be an integral facet of your business. They can augment internal hiring practices and work with your teams to understand your culture.

Your agreement with an RPO firm is usually ongoing, and not only for the times you need to hire quickly. Their focus is usually on permanent talent, and not temporary workers. 

How does an RPO work? 

Bringing on a new RPO team is a lot like doing your own hire. You’ll acquaint them with your business model, culture, and needs. They will spend a good deal of time assessing your current talent gaps and helping you form a plan for filling those. They will eventually be in-the-know on every part of your hiring cycle, including employer branding, advertising, interviewing, and onboarding.

Essentially, they can help with all aspects of your end-to-end recruiting. These recruiters remain a part of your team after you’ve made a hire, too, helping you to assess the entire candidate experience (from sourcing to hiring) and what you can do better next time. 

Pros and cons of RPO

An RPO team exists to help extend your brand and company culture. They are a part of your team and want to see you do better with your hiring and placements. They can consult and advise on every part of this particular business process, and they’ll be an ongoing partner in your talent acquisition plan.

A downside to this recruitment strategy is that they may cost more than a quick contract with a staffing agency. What you spend on the partnership, however, should be made up for with quality hires that reduce your turnover and help you build more robust teams. 

The main differences between RPO and a recruitment agency

Recruitment agencies exist to get people in seats very quickly, while an RPO provider can help you nurture your candidate funnel and source candidates who best fit your needs for the long term. However, the RPO strategy can take time.

Recruitment agencies can stop and start on a dime and don’t need a long lead time to do their job. RPO partners will need a while to get to know your business and needs. They will approach hiring with a more proactive skill set and aim to be a permanent part of your internal talent acquisition teams.

While recruitment agencies can cost a good amount to find your help, they aren’t an ongoing budget item. They only work with you until you find a hire. RPOs, on the other hand, are a significant and ongoing expense you’ll incur month after month (or year after year). But they focus on long-term ROI, and they may save you money by lowering your cost per hire or reducing expensive turnover rates. 

When should you choose RPO vs recruitment agency?

The first thing you should ask yourself is if your hiring need is for a permanent or temporary worker. If you’re looking for a quality, long-term employee, an RPO service provider is better suited for your needs. Also, if you would like to have some control over the sourcing, interview, and hiring process, an RPO solution is a better fit.

If you only need a short-term hire and don’t want to form a long-term partnership with an agency that’s in tune with your culture, a staffing agency may be just what you need. It’s also possible for companies to engage both options at some point in their history, but it’s best not to work with both at the same time. To get the most mileage from an RPO, for example, they really need to be an integral part of your every hiring decision. 

Are you looking to learn more about your staffing options? Ask about how Comeet can help.

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