The business conditions in today’s economic environment have created unique challenges for companies to remain competitive and viable. In terms of the impacts on the Human Resources and in particular how a company resources and recruit’s personnel we are seeing a change in the way we deliver traditional recruitment strategies.

The recruitment industry, and I include internal and external resourcing, is presented with unique challenges. The shift back to the internal recruitment model and the rise of RPO.

More and more I hear companies facing increases in costs and reduction of revenue resulting in the inability be agile, maintain internal and external service and to invest in technology. Coupled with the changing candidate market in terms of multi-generational employees, aging workforce and competition for quality talent the pressures to maintain quality processes and employer brand are ever increasing.

In this article we will look at the impacts change is having on all the stakeholders in the recruitment space.

Recruitment Impacts

Staying ahead of the curve in any industry is a challenge and the impacts of not being able to keep up with change are not confined to recruitment companies, they effect everyday business and candidates as well.


In a declining market companies look to cost reductions by cutting non-core services in the areas of HR, Recruitment, OHS and Accounting. In doing so the ability to grow or react to a new account or project is diminished. Internally this can result in poor recruitment processes, reduced service capacity and increased risk in compliance, engagement and retention.

Alternatively, companies who have traditionally outsourced recruitment to agency have chosen to bring the recruitment process internal. The advent of social media as a recruitment tool has assisted in accessing talent directly.

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The common feedback we here in a candidate rich market is the inability of internal recruitment consultants to engage with all applicants due to antiquated recruitment technology and processes. Candidates reflect this sentiment citing a lack of contact and feedback as frustrating ultimately impacting on the company’s employee brand.

Other challenges internal recruitment face are organisation objectives, competition, agility to adapt to changing markets and the ability to maintain a continuous talent engagement strategy.


Recruitment companies face the same challenges as Internal recruitment. The ability to invest in technology, redundant recruitment processes, retain good employees, increased competition and cost pressures are limiting the capacity to provide to the needs of the companies they service.

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Traditional outsourced recruitment in the form of executive search, permanent placement and even labour hire providers are under enormous pressure to deliver value adding service. The increased competition and reduced market share is no place for the “old school” service delivery based around cold calls, candidate spruiking and percentage based fees.

Increasing we are seeing companies demanding value for money, transparency of cost, quality of service and alignment of values. Recruitment companies still maintaining a commission based culture produce an environment of deliver at any cost and while this may work in some environments smart companies are seeing the value in Internal or RPO style recruitment models.

Aside from these pressures, all recruitment companies still battle with their own problems which include finding the right candidates, balancing speed and quality, candidate loyalty and honesty, hiring delays outside the recruiters control, and antiquated resourcing tools.

Breathing Life into Recruitment

The new breed of recruitment service delivery is partnering with companies to mirror culture and values, deliver strategic HR objectives, they are proactively recruiting in social media and other networks, they are investing in technology, they are providing support HR and OHS services or consulting and importantly they are positioning to replace the internal recruitment model for a more agile and cost effective model.

RPO is a relatively new platform for SME’s in Australia and can be customised to suit a company’s workforce plan. The uptake of On demand RPO is killing the outsourced placement market by delivering recruitment services that are relevant to the company, risk adverse, quality controlled and cost effective.

Our next article will review several case studies in the delivery of RPO services. To review the first of this series, follow this link.