Looking for $2.5 Million? Bring MSP & RPO Together | Market Insights™
An integrated RPO+MSP approach can lead to 20-30% improvement in savings over an independent RPO and MSP approach
An integrated RPO+MSP approach can lead to 20-30% improvement in savings over an independent RPO and MSP approach
RPO providers are increasingly investing in emerging geographies for in-country and/or nearshore/offshore delivery. At an increase of about 20%, Latin America has experienced the most growth, albeit on a smaller base.
The RPO competitive environment remains intense; no provider has as much as 20% market share in either deals or hires. As a result, providers are expanding service offerings up and/or down the hiring pyramid (depending upon their traditional focus) in an effort to increase market share.
While RPO experienced strong growth in 2013, development varied by region. Although new deal signing growth was limited in North America, the market grew at 20%+ due to a steep increase in average deal size. Latin America grew by 23% due to a significant uptick in local deal signings in the region. Growth in EMEA and APAC was moderate.
MNCs across geographies have increasingly explored how global RPO can help address some of the fundamental challenges associated with managing and optimizing a global talent pool. The expansion of global MCRPO reflects shifts in the regional make-up of RPO buying activity.
Some traditional providers are pioneering the offshore model of service delivery in Managed Service Provider (MSP), and the trend is likely to grow as new players (such as Recruitment Process Outsourcing (RPO) and Procurement Outsourcing (PO)) enter the market bringing delivery models they have used in other outsourcing areas.
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In the earlier days of the recruitment process outsourcing (RPO) and broader talent management services industry, partnerships between providers as a means to deliver enhanced service offerings and greater geographic coverage were common. Yet, in the past couple of years, many of these partners have taken the M&A path in response to increasing buy-side desire for consistency and standardization in their recruitment operations.
The Pinstripe/Ochre House merger – announced on July 18, 2013 – certainly plays to the market’s preference for a single provider model. Yet, in their case, the drivers extended beyond buyers’ preference for a single provider model, complimentary capabilities, and a time-tested partnership construct. In fact, Pinstripe could have faced serious client, potential new business, and time-to-market losses had it not taken the merger route.
So what does Everest Group see as the key implications of Pinstripe’s and Ochre House’s union? As excerpted from our just-released breaking viewpoint on the merger:
For more details on the merger and its impact on the market – both buy-side and sell-side – please see Everest Group’s breaking viewpoint, Pinstripe Merges with Ochre House: Demise of Partnership-Based RPO Model.
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