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Aggregation to Support Outsourced Hiring

Of the trends discussed so far, this one is one of the newest to emerge. The general trend of HR outsourcing is, of course, nothing new. Many companies have taken advantage of the ability to have some of the more mundane HR functions taken over by a third-party. I'm not talking about third-party recruitment firms here (like a search firm or a temp agency), but rather firms whose mission is to own the entire hiring process, including recruitment, screening, and assistance, in making hiring decisions. R$o ` gGM

FU8n3Ie z s$o Until recently, most of the focus in HR outsourcing has been on low-hanging fruit, such as benefits administration. However, this industry is getting bigger because of its successes and is pushing into other areas, such as hiring.
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:G:Y SUV8l Outsourcing all hiring isn't for every company. Some folks feel a strong need to keep this in-house because, among other reasons, they feel it's difficult for an outsider to understand them at a level that will allow them to hire people based on company values. So, this full-scale recruitment outsourcing is still in the embryonic stages.
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M.t3~ There are a handful of full-scale outsourcing firms that are in the process of assembling the machinery required to source applicants, manage them effectively (applicant tracking), and evaluate candidate quality (assess).
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The assessment part of it is imperative for these vendors because, being outsiders who are actually assisting in making hiring decisions, they must be able to clearly demonstrate their value day in and day out. For this they need assessment tools. Again, in-house knowledge of assessment tools is pretty low in most of these companies, so the easiest thing for them to do is use an existing company to help provide knowledge and service in these areas.
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Outsourcing firms have several advantages over applicant tracking companies and existing assessment firms that will surely aid the outsourcers in their quest to leverage assessments. First of all, these companies are usually very big and have lots of cash to spend. Acquiring an assessment firm is pretty easy for them. Secondly, these firms are already selling a lot of services many times via a large, distributed sales force. This offers them a foot in the door because they already have relationships with key decision-makers, and they can win the numbers game because they have a sizeable sales force to use to move their products. While the examples of this type of integration are few at the present time, I expect to see lots of action here in the not-too-distant future.%lCP ]bd
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The bottom line is that outsourcers are helping to solve problems and create value in lots of areas within HR, and hiring should be no different. Outsourcers know that they will need assessments to do hiring well, and, lacking in-house capabilities, are going to steadily begin to gobble up firms that can help them hit the ground running.
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9eA#K b {%](h While acquisition of pre-employment assessment companies by other similar companies and by applicant tracking companies is accounting for most of the action in the present day, I expect to see this change. We may see some outsourcers seek to acquire applicant tracking companies who themselves were built off of the acquisition of assessment companies.n9T}7WMf
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For recruiters and other hiring professionals, this means more options for delivering qualified candidates. The benefits of this trend are pretty clear: more ways for organizations to use pre-employment assessment to help them make hiring decisions. This trend allows for the delivery of a slate of prequalified candidates directly to hiring personnel and provides them with a much greater chance of making a solid hiring decision.gf)}2e-nYR
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The trends outlined above have ramifications for both hiring related businesses and hiring personnel. The movement in the marketplace has driven — and will continue to drive — the availability of products and services that can help hiring professionals make better hiring decisions. I believe that this relationship will help businesses with their bottom line as more value can be realized via ROI associated with good hiring decisions.