Outsourcing Recruitment Process In Large Corporations

Background

In the recent years the outsourcing of the recruitment procedure has become a market norm among all the major companies. Hiring employees is a difficult and diverse procedure. It is an elongated process with unsure outcomes (Susomrith and Brown 2013). It is difficult to predict a candidate without assessing him properly with various techniques and equipments. There is an inherent need of storing and maintaining the available information in the market to inculcate the process properly (Karcz 2014). Most of the companies believe that it is better to leave this process to an HR Consultancy firm as they have expertise in the field (Wehner et al. 2015). The contracts or partnerships with these recruiting agencies help the large Corporations to focus on employee development programs, production and distribution (Bansal 2014). They depend on these recruitment agencies as the company is no more liable for the new recruits. Hence, the HR department of the large companies focuses on the Company employee policies like insurance, salary, leaves and sickness and leave the diverse recruitment process to the outsourced Consultancy.   

After the enormous process of industrialisation and professionalization of the Business and the corporate sector, the organisational structure along with the handling of the employees has become a top priority for the large corporations. Every large corporation tries to design and plan its recruitment policies properly (Mol et al. 2014). Various factors like cost, skills, eligibility and ability are kept in mind in the recruitment processes by the Human Resource Management (KILIÇ, GÜNSEL and ÇEKMECEL?O?LU 2016). This process is quite industrious and diverse and hence most of the enterprises face difficulties in the selection of the right recruitment (Wehner et al. 2015). A Business Insider report refers to the massive problems faced by the HR executives in United States in the financial year of 2015-2016 to recruit or seek the suitable candidates for filling up the respective posts of various Enterprises (Bansal 2014). According to David Doyle (Market Analyst), both manufacturing and service sectors are facing the same challenge of filling up the available designations (Wehner et al. 2015). Various reports have mentioned that about 48 percent of the respondents in US are not even qualified for the jobs they are applying for.  In Europe, there has been a major shortage of skilled workers and hence there has been a constant entry of migrant workers in countries like France and Germany in the recent years. However, scarcities of the technicians and trade workers for higher designations have been observed in Australia (Matloff 2013). There has been a constant increase in the job availability per person whereas it has become more and more difficult to fill up various operational posts in Australia. This problem can neither be solved by salary hike nor can be solved by elevating the entire recruitment process (Matloff 2013). A major business website refers to the fact that in the coming financial year the recruitment of qualified workers for the respective posts will be the most critical issue in the large Corporations. According to a major survey in Australia most of skill shortage is observed by the technology sector (Lehberger and Hirschauer 2016). This major shortage has either convinced the Governments to initiate change in their migration policies or it has forced the companies to outsource their jobs in the developing countries like India and China (Vernon 2013). Despite the fact that the companies pay for the salaries of these outsourcing jobs, they prefer it over direct recruitment because of the scarcity of the suitable labour in those developed countries (Vernon 2013). This has resulted into a 150 billion dollar outsourcing industry in India (Matloff 2013). The organisations like Microsoft, 3M, AT &T and Google regularly outsource jobs because of the recruitment problems in the United States of America.

Purpose of the Study

The RPO (Recruitment Process outsourcing) providers are the agencies who are specialised in the recruitment services. They initiate the process of recruitment with specific tools and recruitment. These agencies are also known as head hunters, search firms and staffing agencies.  There are classifications among the RPO providers (Matloff 2013). There are consultancies that primarily focus on administrative or fresher posts; there are agencies who recruit only for IT and sales or specific geographies. Many RPO providers’ also work across all job types and industries but for that they run different departments of head hunters and HR recruiters according to their expertise (Breaugh 2013).

The large corporations of the developing countries have been instrumentally outsourcing their jobs to other countries (Wehner et al. 2015). The recruitment process is also been outsourced to other companies. The purpose of the research is primarily to seek the reason behind such outsourcing job functions to other companies. The purpose of the study also elaborately discusses the reasons why the large corporations are facing major problems in recruiting skilled labour for high designations in the developed countries and what are the impacts of this phenomenon in the market.

The main objective of the research is to find the root cause behind the difficulties faced by the companies like Microsoft, Apple and 3M to hire eligible candidates for the respectable job designations. The area of concern lies on the issues which the Human Resource Recruiters aare facing in searching the eligible employees. The problem lies in the fact that it is a time consuming process.  The objective is to understand the reason why the management of the corporations are constantly finding it difficult to concentrate on the core business and the reason why it is difficult to investigate the background of the employees before recruitment.

The research question generally deals with the purpose and the problems of the research. In this case, the research question is as follows:

Why most of the large corporations in the developed countries are outsourcing the recruitment processes to the other companies?

• The objectives of the research are to describe the key issues behind the unsuccessful attempts of the large companies to recruit proper employees.
• The objectives of the research also include the elaboration on the policies and techniques implied by these corporations to recruit employees.
• The research also emphasises on the cost effective factor for outsourcing recruitment processes to other consultancies of HR consultancy firms.
• The project covers the factors by which a company ensures good revenue despite outsourcing the recruitment policies to a foreign company.
• The idea of the research is also to explore how a company ably operates and improve its structural operations despite shifting a core process like recruitment to another company. 

The outsourcing of job functions is a diverse activity, which is common among the major Business organisations of the country. The scope of the research is limited to the outsourcing of the recruitment process operations functions to other corporations across the developed countries.

The outsourcings of job functions in major corporations around the world have a lot to do with the decrease in the growth of population of the developed countries and in the Post-Fordist business model of aggregation of materials, goods and services (Johnson, Wilding and Robson 2014).  The neo-liberal education policies also play a role to restrict a major population of the developed countries like America, UK and Australia to educate themselves in the Universities (Butler and Callahan 2014). The education of the foreign students in the higher courses of the Industry has emerged as a business in the recent times (Breaugh 2013). Another major issue with the recruitment is the lower IQ level of the general candidates in compared to The Chinese Population. According to the reports of a reputed website the IQ level of Chinese citizens are about 105 in average whereas UK, USA and Australia has an average of 100, 98 and 98 respectively (Bansal 2014). The education system in these developed countries has been ineffective in developing educated individuals for the jobs. Hence, the large corporations are unable to appoint suitable employees for the respective Corporations (Marchington et al. 2016). In the post modern world of communication and technology it has become easy to transport and communicate goods and services in a more effective way (Mol et al. 2014). Therefore, it has become cost effective to outsource various job functions to other countries.

Research Problem

Primarily there are two forms of outsourcing. They are offshore outsourcing and onshore outsourcing. Outsourcing is an old process in the Business world. Outsourcing is a practice of an work done outside the company by a freelancer or another corporation on the basis of business contracts. In the Post-Fordist era of Business, fragmentation of production networks and enhancement of the communication system are identifiable as various major aspects of Multi National Companies (Susomrith and Brown 2013). These modes of production have reportedly helped the corporations to push the costs of production down. The production units are dispersed across the countries as the developing countries are offering cheap labour (Mol et al.2014). These workers generally have better writing, reading and basic computer skills.

In an unstable economy, reduction of cost is held as a top priority for a production company. Every major corporation know and understand that they have to bear a hefty amount for the recruitment process of the company (Marchington et al.2016). The cost of the recruitment process includes the cost on advertising, cost of tracking system which is implemented to track the applicants and the expenditure on the development of a proper technology for the recruitment procedure (Jamil and Neem 2013).  It is a fact that the number of skilled employees have considerably come down in the recent years and this has been instrumental in increasing the cost of recruitment. Most of the large corporations are not ready to bear such costs in order to run such a diverse process of recruitment (Savino 2016). Hence, these corporations are finding it more profitable to transfer the recruitment activities to other HR consultancies based on contracts and monetary deals.  

The RPO providers generally work hard to collect profound information and process their recruitment through energy and time along with screening, sourcing and presentation (Mol et  al. 2014). This strengthens the recruitment process from the core (Butler and Callahan 2014). This recruitment process has enough filtering and proper streaming to decide right job roles for the applicants (Karcz 2014). Therefore, half the job is done by these agencies in the recruitment process and the company remains less stressed for the new employees (Jamil and Neem 2013). These RPO providers are equipped to accommodate each and every situation. A company goes through its highs and lows (Savino 2016). There are times when a company needs a higher number of recruitments (during the time of expansion) and there are times when the company requires few of them (Savino 2016). These Human Resource Consultancy firms have the ability to channel the recruitment process in every season and according to every requirement. They construct a proper structure to adapt to all kinds of situations and seasons of recruitment.

These RPO providers are so well equipped and structured that they register information about the stronger candidates in the pre-recruitment phase. Sometimes the companies face urgent requirement for recruitments (Abdul?Halim et al. 2016). In those situations, these RPO providers appear as a saviour in the business world.  These RPO uses proper software processes to structurally store the information about the best available talent in the market. RPO deals with a long process of analysing the talents available and arranging them according to their eligibility, functions and reliability of the candidates (Breaugh 2013). The range of these RPO providers is much wider than the Human Resource departments of the large corporations (Jamil and Neem 2013). As these consultancies mainly focus on recruitment procedure the recruitments are in average better than the recruitments done by the Human Resource teams of the large corporations. In one hand when the large corporations find it difficult to recruit proper employees for higher designations, the RPO providers do it in a much better way. The head hunters are so professional in their task that they ably select the right candidates for the job functions. The detailed record keeping along with proper mapping guarantees an auditable process of right recruitments of employees.

Research Questions

This part of the research provides information about the design and the methods which are followed in order to conduct it.  The method and design mainly focuses on the journey of the researcher from the setting of the research questions to the conclusion of the research. A review is conducted to identify the reasons behind the outsourcing of Human Resource from the large corporations. The large corporations like Microsoft, 3M and others have standardised the idea of partnering with the RPO providers in the recent past. This design and methodology is to seek for the real reasons behind this phenomenon.

The research design is pre-dominantly exploratory. A research proposal where only a few studies are available to refer is known as exploratory research proposal. The aim of the research is to reflect the insight of the subject and to determine the feasibility of it.

The research approach is mixed. The research is dependent on both qualitative and quantitative data. Qualitative research can be utilized as a link between the hypothesis and the end result of a research (Creswell and Poth 2017). The result of the Qualitative research is based on the subject and the researcher.

The data can be collected from the secondary sources. The secondary sources like journals, research works, articles, authentic websites and media reports are analysed properly to integrate in this research (Creswell and Poth 2017). The information and details of the explanation are recovered from the secondary sources.  On the other hand Quantitative research approach provides affair minded outcome to the researcher depending on authentic survey samples. Quantitative research depends on individual variable (Neuman 2016). It depends on numerical issues. Arnold P (2009) states in his book that quantitative research is useful in terms of bigger sample sizes and to simplify complex and diverse information in it (Sheperis, Young and Daniels 2016).

The data will be primarily collected from the secondary sources. The secondary sources are authentic reports based on real circumstances of those business organisations. These reports are acquired by reputed experts, researchers and journalists from the primary sources and other authentic information. The secondary data is not biased and tries to present a holistic view. The information about the major Business corporations is readily available in the leading business websites. A lion share of the secondary data is collected from these websites.

The entire research is based on authentic sources hence the research is very much valid and reliable. The reliability of the research depends on rightful citation and referencing on the data used from the secondary sources. In a research, when each and every valuable information is well sourced and correctly used the research remains reliable (Neuman 2016). The information which is used in the research is properly cited. Hence, the research is reliable enough to be valid. All the research work is not only taken from authentic sources but they are also from the recent timeline and hence, the information remains authentic and valid.  Moreover, the research presents a holistic picture of the company policies and the current changes in them. This makes the research useful for the future.

Research Objectives

There are some limitations of the research which might affect the result of it. There is very limited time availability for the research in which the activities were to be completed. This might have affected the reliability of the research. The research has been conducted in haste. It could have been conducted in a more detailed way, if more time would have been available.

However, as the research material is entirely dependent on the secondary sources it might miss a few important points which are not properly addressed in the previous research work on this subject. The topic of the research is quite diverse to deal with and that is why it is quite possible that the previous works might not have emphasised several points.  

The schedule of the research is very important to understand the authenticity of the research. The planning and scheduling of the research is the primary step to initiate the work.

S. No.	Actions	Details
A	Research Planning	The first stage is about planning and scheduling the entire research procedure. A proper planning ensures a well structured and well formulated research work.
B	Finding suitable data sources	This is a stage of executing the plan. The entire research materials and data sources will be decided in this stage.
C	Gathering of data	In this stage the data is properly collected and gathered. After the gathering of the data from various secondary sources the data is structurally arranged for further stages of the research.
D	Analysis of data	The collected and arranged data is analysed with a help of specific tools, framework and measurement techniques. This stage is important to find out and discuss the current scenario.
E	Findings and discussion	Data analysis is followed by noting the ultimate findings of the research and properly discusses various aspects to it.
F	Conclusion of the research	Concluding a research is a form of reflection to the entire research work and discuss its success or failure in details.

Conclusion

This research will be useful to various other research works on the business policies of the major corporations in the future. In the current scenario of work culture and Organisation, human intellect is the most important and diverse machine which these large enterprises require to ensure future prospects of their companies. However, selecting the right person is far more difficult than choosing a right machine. A good employee should be gifted with various qualities which is often scarce. Over the years these large corporations have understood that it is far more elongated process to appoint the right employees for the right job roles. This has led them to go for these RPO providers who have specialised in this particular task of recruitment. The recruitment process includes tracking, head hunting, interviewing, testing and grooming. This process is quite time consuming and costly to operate. It is observed that even substantial amount of cost does not help these corporations to appoint the right candidates for the job designations. All these reasons have led them to partner with these Human Resource Consultancies for recruitment. However, there is enough proof that these corporations has been successful in recruiting right candidates which the HR department has not done. It is also to note that the scarcity for the eligible workers for higher positions have become a major problem in the developing countries. The segregated education policies along with high rate of university drop outs have resulted into a scarcity of workers for the large firms. This has put more pressure in the Human Resourcing. Hence, this decision of the large corporations has enough monetary, structural and momentary benefits to it.

References

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