For both growing small businesses and well-established global institutions, HR functions and especially hiring are among the services that are most likely to be outsourced.
In outsourcing, a contract or agreement is drawn up between an employer and an external third party. As part of this contract, the responsibility for and the management of those particular functions goes to the third party.
There are several HR services that can be outsourced: not only recruitment functions but also things like payroll, employee support, data management, policy and procedure support, as well as employee recognition.
In terms of recruitment, outsourcing the HR functions has many benefits, and there are several reasons why this might suit you.
What HR Services Can Be Outsourced When Hiring?
There are several sub-functions of recruitment that can be part of an outsourcing agreement, from talent engagement and strategic sourcing to compliance and risk management, all the way through to analytics and marketing.
The decision on what in particular to outsource is a personal one and will differ from business to business, but the below are examples of some of the sub-functions that are perhaps the most beneficial to outsource.
Job Descriptions And Copywriting
The creation of a job description is more in-depth than it might seem. As competition for the best candidates grows, the right details in the job description can make all the difference when recruiting qualified candidates.
Outsourcing the creation of job descriptions allows employers the opportunity to take advantage of expertise in copywriting - and the knowledge of what works in the job market to get the attention of highly-qualified and motivated applicants.
The right outsourced recruitment offering for job descriptions should combine a deep knowledge of the company and the role, as well as details about the 'ideal candidate persona', so that the exact wording of the advert will be attractive.
Alongside this, the right job descriptions will have enough details to inform the candidate everything they might need to know about the role, the workplace, and the company.
The potential issue with outsourcing the creation of job descriptions is the risk that the third party might not know or understand the business and what the perfect candidate is.
Pre-Screening And Shortlisting
Many third-party providers of recruitment services offer solutions for shortlisting potential candidates, and this is something that can be really useful if an employer does not want to spend hours sifting through seemingly identical CVs and cover letters.
Through pre-screening tools like detailed application forms and psychometric, aptitude, and skills tests, an outsourced recruiter can implement tools that will ensure the very best applicants are put forward into a shortlist that is much smaller and easier to handle.
With pre-screening and shortlisting, there could be a risk that the tools used are not relevant for your business. There is no point in potential candidates for a sales role taking a coding skills test, for example.
Marketing And Advertising
Having a great job description and a concise and detailed shortlisting procedure is not going to help find the very best talent if potential applicants do not know the role – or your company – exists.
Outsourcing the marketing and advertising in recruitment allows access to expertise in the right places to advertise, and some that you might not have considered. Some recruiters might post on well-known online job boards, while others might use social media sites, chat rooms and specific online sites for specialist staff.
In terms of advertising a company, brand consultation and management can help ensure that your business is seen as an inviting place to work. This can be achieved by a dedicated careers section on the company website and a great user experience through the application process.
Handing over the control of marketing roles and the business as a whole can mean relinquishing quite a lot of control. As such, this needs to be undertaken with a lot of trust, especially when it comes to creating the right brand voice.
In-house recruitment offers a go-to person for all hiring questions and queries, but this can be expensive in terms of salary.
Choosing a recruiter to outsource to can mean a remote person controlling certain aspects of the application process; there is the option of having an outsourced HR person (or team) that will come on site too.
This means that they can take on the whole process of recruitment, from initial contact right through to undertaking phone and face-to-face interviews, if needed.
While outsourcing HR in recruitment is meant to reduce time and cost in hiring, having a physical recruiter from an outsourced team might prove quite expensive, too.
There is no denying that the application of technology can help in many ways through the recruitment process, from managing candidate information to creating the latest psychometric tests like the audited AI games. Purchasing software or creating relevant tests is beyond many businesses – but even technology can be outsourced in recruitment.
Some businesses that are involved in providing outsourced recruitment can also offer a number of bespoke, personalised and useful technological innovations that can be used at almost every step of the application process.
It is worth considering, however, that there are several test publishers offering bespoke recruitment technology that might be cheaper in the long run than hiring outsourced recruitment services.
Benefits of Outsourcing
1. Save time
Recruitment can be one of the most expensive functions of HR in terms of time. Outsourcing even one of the above services could save a lot of hours in the working time of those responsible for managing job applications.
For smaller businesses – especially when it is the owner/CEO of the company that is in charge of the recruitment – hiring outside talent to manage the whole process can ensure that you have time to focus on other areas of the business to create more money, attract new customers, and work in the business rather than on it.
2. Use Expertise
Even the most successful business owners are not experts in all areas of their business. It is so beneficial to engage an expert when you need it.
Whatever functions you are considering outsourcing to a third party, you can choose experts. Whether they specialise in just one aspect or offer a broader service, taking advantage of the knowledge and experience of an expert recruiter could end up being priceless.
3. Save Money
Employing an in-house HR team or even a recruiter can be expensive, in terms of salary, time and cost-per-hire. By outsourcing some or all of these functions, a lower overall cost can be achieved.
Not only will it be cheaper in the long run, the recruitment service can then be thought of as just another invoice.
4. Minimize Resources
The recruitment process itself can be resource-intensive: different staff involved in screening CVs, reading test reports, conducting interviews and completing onboarding procedures. Taking some of the pressure off the business in terms of resource investment can be very beneficial, especially to the smaller businesses.
Expertise could also be beneficial when it comes to compliance with legislation, especially around discrimination and bias. Knowledge of employment policies, regulations and laws can be difficult to come across unless you are a specialist, so the expertise offered by the outsourced recruitment resource might be even more important.
Potential Issues with Outsourcing
1. Loss of Control
This can be a problem for businesses of all sizes. Handing over control of a previous in-house function to a third party business can mean losing a portion of control. There has to be an establishment of trust that underlines the contract between the employer and the third party.
For the employer, outsourcing some HR functions, especially in recruitment, is a relief that frees them up to focus on other portions of the business. However, for the applicant, a third-party recruiter might seem more impersonal.
It might come across to the candidate that the company is faceless and lacking in personality.
Remote outsourcing saves time and money, but the physical distance between the employer and the third party can also prove difficult.
This distance can make it difficult for regular updates and meetings to take place. It can mean that some HR functions are more difficult, like employee evaluations. It makes having the outsourced recruitment service coming to the office when needed more expensive (to perform interviews, for example).
Outsourcing HR functions in recruitment can save money, time and resources, but it does mean letting go of some control.