Driving Change at Northgate Through Outsourced Recruitment
An outsourced recruitment strategy at Northgate Plc, the UK’s leading commercial vehicle hire company, has resulted in higher calibre candidates and cost savings.
Marc Bertrand, HR Director at Northgate, explains how he has steered the business through the process.
In early 2010, Northgate embarked on a significant change – the organisation merged its 30 separate businesses into a single ‘One Northgate’ organisation, with offices spread across the UK and Ireland. The new direction for the company sparked a major catalyst for change. It resulted in the creation of centralised business functions, including a centralised HR team.
Marc Bertrand explains, “As separate businesses, without any centralised HR support, each business had been responsible for its own recruitment. The standards of the recruitment process between the different organisations varied dramatically. The candidate experience was often poor and there was certainly no consistent approach. What’s more, many of the managers responsible for recruitment thought it was normal to pay 20-30% in recruitment fees so the cost per hire was unnecessarily high.
“With a centralised approach to recruitment, we were aware of the advantages in being able to control the costs and standards in the recruitment process in order to attract high calibre candidates. The newly formed centralised HR team, of seven people, had a remit which covered all 1,900 Northgate employees across the UK and Ireland. We did not attempt to handle the recruitment process ourselves. We moved straight from a decentralised model to an outsourced model and partnered with ResourceBank as I had a positive experience of working with them in my previous role as HR Director at Magnet.”
Recruitment was the only HR function which Northgate decided to outsource. Persuading the management team to adopt this new outsourced approach was simple, according to Bertrand.
“The first stage of the outsourced recruitment process involved centralised logging and authorisation to enable the HR team to control headcount and payroll costs. This is a significant cost for all organisations and was a cost which was difficult to keep track of with our decentralised approach. Naturally, this enhanced control had great appeal to the board.
“We also put a compelling case forward to the managers across the business. If they needed to recruit someone, all they now needed to do was to brief ResourceBank about the role. They needn’t do anything else other than interview three strong candidates and decide who to offer the job to. They would save a significant amount of time by not having to deal with recruitment agencies, conduct first interviews, discuss offers and issue contracts.”
Bertrand believes that one of the key reasons why the outsourced approach was so well received by the business was that the HR team did not make it compulsory to work with ResourceBank for recruitment.
“We made it perfectly clear that managers were under no obligation to use our outsourced recruitment team. We explained how the process would work and the advantages to them in terms of time savings and the improved calibre of candidates due to the positive candidate experience and vetting processes. Word quickly spread that the service was excellent. There was no resistance from within the business and the uptake of ResourceBank’s services has been virtually 100%. In fact, we recruit all roles through ResourceBank other than for a few specialist roles in finance and IT, where specialist recruiters are used.”
Making the Partnership Work
Having persuaded the organisation that an outsourced approach was the way forward, the next challenge was to make the processes work effectively and to ensure that ResourceBank had a thorough understanding about the Northgate business.
Bertrand continues, “Setting up was relatively straightforward. We simply adopted all the infrastructure and processes that ResourceBank already had. I used these when I was at Magnet and I knew they worked well. These ranged from the authorisation process through to the offer letter.”
Preparation was key. The ResourceBank team was given three months to set up all the processes and gain a thorough insight into Northgate’s business. During that time, they also developed the Northgate careers website in order to have an effective means of publicising vacancies and linking candidates directly to the ResourceBank recruiting team.
“During the three month window before the kick-off date, the ResourceBank team spent a lot of time in the business, building relationships with line managers, understanding our roles, our geography, the sort of people who do well in our business, our pay rates and our future plans,” continues Bertrand. “They joined us at regional, head office and area team meetings to gain further insight and communicate their recruitment processes. This period involved a strong commitment from ResourceBank but was critical to the success of the outsourced process.”
ResourceBank has a dedicated team of seven people who form the Northgate Resourcing Centre and reflect Northgate’s brand values at all times. Individuals from this team are allocated specifically to regions or line managers, ensuring the development of strong relationships and an in-depth understanding about the Northgate business. Since their appointment, ResourceBank have been invited to attend company conferences, have been informed of top level plans and have been treated as an essential and valuable team within Northgate.
In terms of Northgate’s internal HR resource to manage ResourceBank, the time commitment is minimal, according to Bertrand. The day-to-day relationship with ResourceBank is managed by one member of the Northgate HR team. It takes up about one third of their time, which is largely spent on general liaison and query handling.
“For a true partnership to work with an outsourced provider, trust is paramount,” says Bertrand. “Having worked with ResourceBank for ten years prior to Northgate, we have built a high degree of trust in each other. They need to trust us that we will drive as many people as possible through their recruitment process. We need to trust them that they are actually doing whatever they say that are doing behind the scenes. Ultimately, you can tell this by the results.”
ResourceBank was briefed to fill 354 vacancies during the first year – with roles varying from valeters through to rental desk assistants, managers and new business managers.
Key performance indicators were agreed from the outset and shared with all involved in the process. It was agreed that, for 80% of roles, ResourceBank needed to present the recruiting manager with three strong candidates within four weeks of the vacancy being approved. The target for vacancy approval to a job offer was agreed at under eight weeks, and the process from logging a vacancy to being signed off by the HR team was set at five days.
Marc Bertrand continues, “We have been within those KPIs from the outset and they are very clear and measurable. We have impressed the managers by improving the recruitment process and we are also aware that candidates have been impressed by the process.
“As all candidate communication with ResourceBank is done under the Northgate brand, candidates are never aware that the Northgate Resourcing Centre is run by an external organisation. Throughout the candidate journey, from candidates’ first experience of Northgate through our careers website, our recruitment process is highly professional, which reflects well on our organisation. If the ResourceBank team say they will get back to a candidate by Friday, they always do so. The number of candidates who turn down our job offers has gone down to just 2% and many high calibre candidates are choosing to come to Northgate, rejecting job offers from more well-known, blue-chip organisations. This is because we have treated them well throughout the recruitment process and have also clearly communicated the positive aspects of being a Northgate employee.”
In addition to improved processes and higher calibre candidates, the cost of recruitment for Northgate has come down by almost two thirds. The payment structure agreed with ResourceBank is simple and transparent, making Marc Bertrand’s budgeting very easy and stable.
Enhancing Skills within the Business
One issue which is sometimes raised in relation to outsourcing, is the fact that, by outsourcing an entire function, the business loses key in-house skills. Bertrand refutes this.
“As the line managers’ involvement in recruitment is now limited just to interviewing, they have received training to turn them into skilled interviewers. They have been able to spend time on this training because they are saving so much time by not being responsible for the recruitment process. As a result, they are now much more skilled in this area and are making good hiring decisions.”
HR Managers at Northgate have also been able to develop their skills. Instead of getting swamped by the administrative side of recruitment or driving around the country to meet individual candidates, they are involved in assessment days. They see more candidates in a day than before, in a more sophisticated vetting environment, which improves their recruitment skills.
Marc Bertrand concludes, “Recruitment will probably be steady for us over the next year and, having had a successful first year, we are not looking at changing anything in the process. The KPIs work for us and are important to the business. We will continue to use the same ones.
“Outsourcing to ResourceBank has improved the service we give to the business, has reduced my budget and makes us a key business function because the recruitment of the right people is vital to our future. I wouldn’t hesitate to go down this route again.”
Marc Bertrand’s top tips for HR Directors who are considering outsourcing recruitment:
1. Preparation time is key – allow sufficient time to set up the systems and make sure that the process works before you push the button.
2. If you have confidence in the offering, make it voluntary not compulsory.
3. Select your outsourced partner carefully. Being a big fish in a small pond is better than being a small fish in a big pond
4. Make sure your provider gives you a dedicated team, who work only for you and always for you.
5. Make sure there’s a clear and tangible benefit for the business in outsourcing a particular function.