The rationale and effectiveness of recruitment outsourcing

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School of Economics | Master's thesis
International Business
Kansainvälinen liiketoiminta
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The purpose of this thesis is to evaluate the rationale and effectiveness of recruitment process outsourcing. In the past these processes have been studied mostly with case studies evaluating recruitment outsourcing of a specific organization. This thesis however, will take a cross-industry focus in order to evaluate these issues on a more comprehensible and broad scale. The research process is guided with research questions, the purpose of which is to evaluate distinct issues related to recruitment process outsourcing. These include identifying the factors that form the rationale for outsourcing processes and what kind of issues affect their effectiveness. Moreover, two common recruitment outsourcing scenarios, international recruitment and technical recruitment, are analyzed in depth. In order to critically evaluate these issues and answer the research questions, a theoretical framework was constructed based on primarily three of the most relevant streams of academic literature: (1) recruitment, (2) human resources outsourcing, and (3) recruitment outsourcing. This was then complemented with supportive literature on change management, talent management, and strategic human resources management that relate closely to the recruitment outsourcing processes. The findings of the present study were collected using a mixed-method approach combining qualitative and quantitative data. First an industry expert was interviewed in order to gain practical knowledge about the subject. This was followed by an extensive quantitative survey with a pool of respondents consisting of Finnish human resources professionals from different organizations. The response rate was approximately 7.5% with 225 respondents completing the survey. Consequently, the sample size was significant enough to be used for a cross-industry analysis. The key findings were that issues including international recruitment and technical recruitment might both provide a rationale and affect the effectiveness of recruitment outsourcing activities. Moreover, there was strong indication that only certain stages of the overall recruitment process are suitable for outsourcing. For example, processing the application material is ideal for outsourcing, whereas primary interviews should be conducted in-house based on the sample. All findings retained the desired cross-industry approach, as the sample was not limited to any firm context thus making the conclusions applicable to various different business cases. Fundamentally, the broad focus made this a unique outlook to the underlying themes affecting the recruitment outsourcing processes.
recruitment outsourcing, human resources outsourcing, recruitment, mixed-method research, strategic human resources management
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