The myth of “Build” vs. “Buy”
I grew-up in recruitment, specifically the temporary staffing industry, in the heyday of consolidation. When I started, clients were working with multiple staffing services, metrics and reporting were unimaginable across the client enterprise and there were no systems beyond rudimentary time keeping clocks. When I left the industry, single vendors had morphed into Managed Services Providers with visibility globally into metrics at every level, deep dive analytics and very slim margins; the staffing industry had officially been commoditized.
I transitioned into another exploding recruitment-based industry in its infancy, Recruitment Process Outsourcing (RPO). The basic premise is a client realizes economies of scale, re-engineers processes and drives cost savings by outsourcing a key internal function—recruitment. When potential clients were considering the prospect of RPO, the greatest “competitor” was frequently the client themselves. There was always a chance that you would present all the options, demonstrate the value proposition and create trusted adviser relationship and then rather than buy the service, the client would ”in-source”, build a recruitment department for themselves. The driver was often the risk for change was too great, particularly for some companies to give over their most critical of functions…attracting and hiring their greatest asset, people.
And so it was born, the “Build vs. Buy” myth. Rather than outsource, the Client would hire stronger Talent Acquisition leadership and build world-class recruitment from the ground up. They would harness technology, they would train, and after all, they felt they understood their culture better than anyone outside their company possibly could. And some RPO firms heard this message and adapted, offering process-based RPO, outsourcing functions like sourcing or first level screening. And for many companies, this works, plugging a hole where there isn’t enough internal scale or budget. But even when offering this limited outsourcing, many RPO providers are offering a scaled-back version of their end-to-end process rather than an agile creative approach to a client-specific requirement. Some companies continue to “build” although they do not have the investment dollars or budget, the best practices visibility, or the technology and associated supporting team to build and continue to improve upon a best of breed full-cycle recruitment process. There are companies that do succeed, but they are rare. Others have “bought” (outsourced completely) with limited results. Others know they need to make a change but are not sure how to do so and are hesitant to outsource, particularly if they cannot find a provider who is willing to work with them to build a flexible solution.
And yet, the prevailing wisdom is either/or, Build OR Buy. I don’t see it as an either/or proposition and I propose if you change the prism of your perspective from recruitment outsourcing to recruitment optimization, you may agree with me. Perhaps the question should not be “build or buy” or even “build and buy” but rather “what is the best way to improve and optimize recruitment within my organization?”
Even the strongest of Talent Acquisition experts face internal challenges. One of the greatest is the inability to operate strategically and deliver tactically. Understanding the market trends, including social media to mobile to video to new technologies, coupled with a changing legal and compliance landscape, while operating recruitment operations day to day is a feat not for the weak-kneed. Think about mobile-optimizing a career site, re-engineering a workflow, implementing automated reference checking or interview scheduling, researching and analyzing compensation requirements in remote sites; and the list goes on and on. Recruitment is constantly challenged to do more with less, to be on the cutting edge, to respond quickly to “surprise” location openings or acquisitions. Today’s CEOs expect recruitment to make a measurable impact on productivity and profitability. Recruitment is no longer a subset of HR but arguably, a stand-alone practice area that has unique impact on an organization’s agility and go-to-market strategy.
This creates an opportunity for recruitment augmentation. Recruitment services across a wide spectrum, to address requirements from short-term tactical challenges to long-term strategic objectives. Specialized recruitment consultants, not generalist HR consultants, can be deployed to handle gap identification and analysis. Options and solutions can include traditional RPO but also project management, contract staffing (both recruiters and other highly skilled positions), retained search, third party agency management, technology, employment brand, research and sourcing, administrative support, recruitment helpdesk and temporary staffing. This augmentation approach, identifying the right solution based upon current status and aspirational goals, is truly a holistic recruitment optimization strategy.
Just like the staffing services in the 90’s, these solutions don’t have to be delivered by multiple partners. Your existing partners should be offering more than one core service (even if it has multiple variations) by joining with technology, marketing, social media and other firms with recruitment applications to offer a cohesive suite of services. But choose carefully, no one understands the complexities of recruitment like a recruiter.