Recruitment Process Outsourcing (RPO) & Managed Service Provider (MSP) Explained
Recruitment Process Outsourcing (RPO) and Managed Service Providers (MSP) both aim to improve company efficiencies by alleviating the strain of managing resourcing needs. But what do these two terms mean, and what is the difference between RPO and MSP?
What is Recruitment Process Outsourcing?
RPO is when a company chooses to transfer all or part of its recruitment process to an external provider, such as NP Group. That RPO provider can take control of areas such as candidate sourcing, screening, and onboarding, or alternatively provide you with a full end-to-end solution. To achieve the best results possible, an RPO provider will fully embed themselves within your HR or Talent teams, fully utilising your own brand values and culture. RPO can easily be scaled up and down or used for projects only, ensuring that a company doesn’t waste resources during slower points of the year.
What is a Managed Services Provider?
MSP offer a similar end-to-end recruitment solution but focus entirely on contingent workers. This term includes temporaries, consultants, contractors, freelancers, Statement of Works (SoW) and other non-permanent staff who work for a company. An MSP will take over the management of this contingent workforce focusing on cost management, process efficiencies and ensuring that the company remains compliant in its treatment of such workers, whilst also staying true to the values of their company brand. Workers may be supplied by a network of different agencies, but all will go through the MSP who acts as the liaison and supply chain manager.
Both RPO providers and MSPs can dramatically reduce the amount of time you waste managing a recruitment process, whilst also giving you full visibility and control over your resourcing strategy.
What are the differences between RPO and MSP?
Type Of Workers
The main difference between a RPO and an MSP is the type of worker they supply to a company. RPO providers solely focus on finding the ideal long-term permanent employee who is going to make a real difference to your company, whereas an MSP will find you the perfect skillsets to fulfil a temporary need.
An MSP sources temporary workers for a company by working conjunction with third parties. Using a Vendor Management System (VMS), they may both source directly for suitable candidates and reach out to an established network of staffing agencies with their criteria. From the options presented back you will select the individuals they wish to hire ultimately consolidating supply and invoicing.
In contrast, an RPO provider will source candidates themselves. To do so, they will use a multitude of different methods including a search of their pre-existing database, social media, and extensive industry contacts. As well as engaging active applicants, an RPO provider will also contact individuals who they have identified as having the necessary experience and skills to succeed in the role, even if they aren’t actively looking for a new job. Ultimately, creating a pipeline of future talent for your business.
As many parts of our lives become digitised and automated, recruitment is no different. Providers draw from a tech stack that may cover Sourcing, D&I, Candidate Engagement, Vetting & Assessment and Market & Business intelligence.
There are distinct differences in the tracking software that an MSP may use with a Vendor Management System (VMS), which automates all supplier activity, including compliance and costs, whereas an RPO tracks the recruitment process through an Applicant Tracking System (ATS) As a result of the COVID-19 pandemic, Brexit, supply chain issues and the cost-of-living crisis; pressures on the labour market are unprecedented.
With a severe lack of candidates, the need for an organisation to promote its brand and EVP attract both temporary and permanent workers have hugely increased. Therefore, instead of using a multitude of recruitment agencies who don’t recruit in your own brand, it’s hugely beneficial to partner with an MSP or RPO provider as not only will they give you visibility, control and cost reductions but they will help promote your own employer brand.
Flexibility is key when outsourcing recruitment, which is why NP Group offer, not only, traditional RPO solutions & MSP services but also bespoke talent solutions on a modular basis. From candidate screening services to market mapping to Project RPO and Employer Branding, whatever resourcing challenge you are facing, we can help.
To learn more about MSP or RPO or how we can help you put a business case together for these types of resourcing solutions, please get in touch.
Contact Jon Axcell to learn more about how NP
Group can help:
t: +447990 598 741