RPO Wars: Episode II – A New Decision

As originally published on ERE.net…

A time right about now,
In a galaxy not far, far away…
The war looms among recruiting service providers and the definition of RPO,
Some staffing agencies masquerade as RPOs while other suppliers
Offer promises of full cycle outsourcing yet cannot retain recruiting staff to deliver.
An expanse has been created between marketing realism and actual delivery,
The lines have been blurred between true RPO suppliers and imposters;
Which leaves clients to sift through the jargon to find the right solution…

As I adjust my storm trooper helmet to return to the frame of mind of Star Wars as a metaphor for RPO selection and implementation, I delve ever deeper into the RFP process. We last left our story and main characters, C3RPO & RFP2D2, heading for the planet of “Demo-gobah” as we developed the business case for selecting an RPO supplier.

Outlined in the first article of this series, RPO Wars: Episode I – C3RPO & RFP2D2 <hyper link to article>, it is essential to develop a business case to understand “why” an organization should consider partnering with an RPO supplier and “what” services will help you solve your business needs.

Like the Alliance Starfighter squadron preparing to destroy the death star, I emphasized the importance of following a project plan and working through the four phases of project management: Discovery, Development, Implementation, and Ongoing Improvements. We are focused on the steps of the Discovery phase: Requirements, Evaluation, Selection, and Negotiation. We traveled through the Requirements stage and now enter the Evaluation stage beginning with the development of the RFP.

Creating the RFP

Under the Evaluation Stage, it is necessary to consolidate your findings and requirements into a document that will be communicated to prospective vendors, aka a Request for Proposal (RFP). The RFP, like the droid R2D2, will hold all the information you need to figure out RPO. It can be written a myriad of ways but the simplest is to have 4 sections:

  • Overview – describes your organization and the current state of recruiting and what you propose to solve.
  • Intent – articulates the purpose of seeking a partnership with an RPO Service Provider and outlines key elements to the relationship.
  • Timeline- establishes the scope of the project and outlines milestones from selection to implementation.
  • Expectations – lists what you require a vendor to deliver and measure and how to respond to RFP.

The RFP document should be comprehensive enough to gather meaningful data to allow you to differentiate between suppliers and how they will meet your needs. Yet not so detailed that the process is cumbersome for everyone involved or become more a burden than a value. The primary purpose is to capture data to compare and rate the suppliers in key areas to make an informed decision.

Unlike a battalion of Stormtroopers, RPO suppliers are not homogeneous and each will be differentiated by process, system, and specialty. However, all are similar in that they provide recruiting labor. As part of the Expectations section of the RFP, a key element to focus is the quality of recruiters retained by the supplier. A few questions to add might be:

  • How is the recruiter function organized?
  • What is the retention or turnover ratio of the overall recruiting team?
  • What is the succession plan for recruiter turnover?
  • How do you measure recruiter performance?
  • How do you retain your better performing recruiters?
  • How experienced are the recruiters in specific areas?
  • Which of these recruiters are available for this project?
  • How do you guarantee performing recruiters stay on our projects?
  • How do you keep pace with market rate pay to appropriately compensate strong recruiters?

In fairness to suppliers, the RFP exercise takes time and attention and should only be distributed to a short-list you are seriously considering. Suppliers are a wealth of market knowledge and regardless of selecting their services or not, I recommend you maintain strong relations and do not develop a reputation of wasting their time.  Distributing an RFP to a broad slate of suppliers is not recommended. If you do, similar to the scene in Mos Eisley Cantina, you might find yourself surrounded by a group of belligerent suppliers at the next conference you attend.

Pre Qualify with an RFI

Simultaneous to developing the RFP, draft a Pre-Qualification or RFI (Request for Information) document which provides a top line list of requirements to help narrow the list of prospective RFP Service Providers to evaluate. The top-line list should outline:

  • High level business needs such as full cycle versus sourcing support
  • Cultural needs such as onsite versus remote recruiting support
  • Industry specific experience such as hospitality or healthcare
  • Skill vertical such as Information Systems or Sales
  • Budget range such as cost per recruiter or cost per project

Research and identify a handful of providers that appear to meet some or most of the top line requirements. Simply put, you don’t invite a Wookie over for dinner when you have white carpet; chances are it won’t go well.  Distribute the RFI to allow suppliers to opt in or out of your evaluation process. Conduct a prequalification call with those vendors that opt in to verify if they meet the top line needs. By this time, the list of prospects should be pared down to 3-4 vendors. This will be the group to run through the RFP process to find the right supplier(s). As tempting as it is to search for a one-size-fits-all supplier, it is possible that you will select multiple vendors who solve different needs.

Distributing the RFP

Once the list of suppliers is confirmed, you will distribute the RFP with submission instructions which include timeline and expectations.  If your organization uses an RFP Management system, I strongly recommend you leverage this software as it automates many steps in the process and reporting. If you do not have software, the process can be handled using documents and spreadsheets.

This is an interesting step in the process as it can provide insight into the professionalism and sophistication of the supplier. It is common to field questions at this point regarding the RFP process to clarify expectations. However, it also can reveal nuances of the supplier and how well they listen and understand client needs. If the questions are relevant to the RFP this demonstrates they’ve reviewed the document and respect the process. If the questions are not relevant to what is outlined in the RFP or if they attempt to further ‘sell’ their services instead of responding to the RFP, this demonstrates an inability to follow instruction or an attempt to short cut the process. This could be indicative in how they operate overall and clarify if you’re dealing with the likes of an Anakin Skywalker or a Qui-Gon Jinn.

Although these data points should not solely be used to make a decision, they should be used as part of the overall decision making process. I had a supplier wait until the deadline to ask questions which made it obvious they did not review the RFP until the deadline and then scrambled to complete the document. They did not meet the deadline and asked for an extension which delayed our process one week. As we entered the demo stage, they were also the least prepared. Without evaluating their services, we formulated a negative impression and inevitably they did not win the business.

Rating RFP Responses

In support of the responses, the RFP information collected should be input into a spreadsheet and formatted in a side by side comparison that aligns with the RFP questions. This will allow you to track and easily compare suppliers. If you are utilizing RFP management software, this report will be standard. Keep the evaluation simple and quantify the responses to give you a score to rate the supplier responses. A couple clear winners should emerge that you will want to meet for demonstrations.

Although I am writing in sequential process of how the evaluation stage might be managed, it can always be handled differently based upon preference. For example, Demonstrations can be conducted as part of the RFP process instead of being a separate step.

Demonstrations

I err on the side of being overly prepared for demonstrations and provide tools to assure suppliers and project team members are aligned. For demonstrations to be productive, I develop the following documents:

  • Guidelines – this communicates expectations for suppliers and project team members and dictates the rules to keep continuity among the sessions.
  • Script – this communicates to suppliers what the project team expects to see from their demonstration and what items the supplier is being measured.
  • Evaluation forms – this communicates to the project team what is being evaluated and how to score their opinion to provide continuity in rating supplier performance.

Similar in how a spreadsheet is utilized to capture RFP responses, use a similar format to document input from the demonstrations to allow for a side by side comparison. Score the responses and a clear winner or winners will become obvious. It is now time for a decision.

A New Decision

Unfortunately, no Jedi wisdom will magically materialize to help you make the decision. Rather you will rely on the information gathered to make the best informed decision. At this point, you would have collected the following data points:

  • RFI input
  • RFP input
  • Demonstration input

Utilizing this information measured against the business requirements outlined in the RFP, the conclusion should become obvious once discussed among the project team. At this point, you will dismiss those outliers and announce to the winner(s) that you would like to enter into negotiations.

Once the supplier(s) is selected and agreement in place, it is time to jettison out of the Discovery phase into the Development and Implementation phases. This is when you find out if you’re working with playful Ewoks, an arrogant Lando Calrissian, or gung ho Starfighters.  One thing is for certain, not everything will go as planned and the project might feel like a bumpy ride on the temperamental Millennium Falcon. Therefore, you should not fly alone.  Who will create and manage the project plan? What tasks will be assigned and when will they be completed? When will the supplier be ready to implement? Who will pilot the pilot? Read on in the next article of RPO Wars: Episode III – Return of the Project Manager.

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