Recruitment Process Outsourcing and Applicant Reactions: When Does Image Make a Difference?

• DOI: http://doi.org/10.1002/hrm.21640
• Author: Angelo Giardini,Marius Claus Wehner,Rüdiger Kabst
• Published date: 01 November 2015
• Date: 01 November 2015

Human Resource Management, November–December 2015, Vol. 54, No. 6. Pp. 851–875

© 2014 Wiley Periodicals, Inc.

Published online in Wiley Online Library (wileyonlinelibrary.com).

DOI:10.1002/hrm.21640

Correspondence to: Marius Claus Wehner, Faculty of Business Administration and Economics,

Universityof Paderborn, Warburger Str. 100, D-33098 Paderborn, Germany, Phone: +49 (0)5251 60 4109,

Fax:+49(0)5251 60 2077, E-mail: marius.wehner@uni-paderborn.de.

RECRUITMENT PROCESS

OUTSOURCING AND APPLICANT

REACTIONS: WHEN DOES IMAGE

MAKE A DIFFERENCE?

MARIUS CLAUS WEHNER, ANGELO GIARDINI,

ANDRÜDIGER KABST

Many organizations transfer parts of their recruitment process to external

service providers—often referred to as recruitment process outsourcing

(RPO)—to save costs and enhance the quality of their recruitment procedures.

However, contrary to the expectations regarding RPO, Wehner, Giardini, and

Kabst (2012) found that RPO might cause negative reactions to recruitment

procedures among graduates. We extend that study by incorporating a brand

equity perspective in examining whether employer image and service pro-

vider image counterbalance negative reactions among graduates. Utilizing

a scenario-based, between-subject design, we obtain results that show that

the extent of RPO negatively infl uences applicant reactions regardless of the

employer’s or service provider’s image. Furthermore, we fi nd negative medi-

ating effects of RPO on job acceptance intention. However, the perceived fi t

between employer image and service provider image positively infl uences

applicant reactions. Moreover, employer image positively infl uences em-

ployer attractiveness and service provider image positively infl uences appli-

cants’ satisfaction with the recruitment process. Thus, a strong employer im-

age and service provider image partially compensate for the negative effects

of RPO on applicant reactions. © 2014Wiley Periodicals, Inc.

Keywords: outsourcing, recruitment, employer image, service provider

image, applicant reactions, brand equity

Introduction

Organizations increasingly outsource

their recruitment function to exter-

nal service providers (Conklin, 2005;

Cooke, Shen, & McBride, 2005; Shen,

2005). Recr uitment process outsourcing

(RPO) refers to the delegation of recruitment

and selection activities to external service pro-

viders (e.g., Berkowitz, 2005; Syedain, 2008).

From a firm’s perspective, the recruiting func-

tion is an eligible candidate for outsourc-

ing because the recruitment process is highly

standardized [i.e., it involves a job advertise-

ment, preselection and selection procedures,

852 HUMAN RESOURCE MANAGEMENT, NOVEMBER–DECEMBER 2015

Human Resource Management DOI: 10.1002/hrm

In general, HR

outsourcing

promises several

advantages for

client companies,

including cost

savings, increased

efficiency, a

stronger focus on

core business, and

access to external

knowledge and/or

best practices.

showed that the extent of RPO negatively

affects applicant reactions to the recruitment

process because RPO diminishes the personal

contact between employer and applicant.

In the context of RPO, however, two factors

that have not been accounted for might influ-

ence applicant reactions to recruitment pro-

cedures: the image of the potential employer

and that of the external service provider.

A good corporate image—also referred to as an

organizational image or institutional image

(Lemmink, Schuijf, & Streukens, 2003)—is

a valuable asset for organizations because it

enables them to attract more and highly qual-

ified applicants (Dowling, 1993; Fombrun

& Shanley, 1990; Lemmink et al., 2003).

Previous research found that different types

of corporate image exist (Dowling, 1988;

Highhouse, Zickar, Thorsteinson, Stierwalt,

& Slaughter, 1999). In particular, several

terms for the corporate image of an organiza-

tion as a place to work have emerged in the

recruitment literature, including employer

reputation (e.g., Collins, 2007), company

employment image (e.g., Highhouse et al.,

1999; Lemmink et al., 2003), and employer

image (e.g., Backhaus & Tikoo, 2004; Lievens,

Van Hoye, & Anseel, 2007). Because we are

basically interested in the corporate image of

the potential employer as a place to work from

an applicant’s perspective (Highhouse etal.,

1999; Lemmink etal., 2003), we define this

specific kind of image as the employer image.

Furthermore, we are interested in the image

of the service provider as an external vendor

of recruitment and selection services from an

applicant’s perspective, which we define as

the service provider image. In considering both

employer image and service provider image,

we follow previous research and employ to

the concept of image “associated with the

name of an organization” (Belt & Paolillo,

1982; Gatewood, Gowan, & Lautenschlager,

1993, p. 414). We assume that employer

image and service provider image have sepa-

rate effects on applicant reactions to RPO at

certain stages in the recruitment and selec-

tion process.

This study analyzes the influence of

employer image and service provider image

as contextual factors in applicant reactions

and interviews (cf. Barber, 1998)]. In general,

HR outsourcing promises several advantages

for client companies, including cost savings,

increased efficiency, a stronger focus on core

business, and access to external knowledge

and/or best practices (Belcourt, 2006; Byham &

Riddle, 1999; Cooke etal., 2005; Shen, 2005).

Although these advantages of HR out-

sourcing are widely accepted, HR outsourcing

also has some disadvantages (e.g., Belcourt,

2006; Conklin, 2005; Shen, 2005). Shen

(2005) outlines several examples in which

HR outsourcing led to an increase in total

costs because service providers were not able

to attain economies of scale and

design specialized procedures for

each client simultaneously (Greer,

Youngblood, & Gray, 1999; Shen,

2005). Other potential pitfalls

of an outsourcing relationship

are dependency on a single ven-

dor, loss of in-house competen-

cies, and decreases in employee

morale (Byham & Riddle, 1999;

Cooke et al., 2005; Shen, 2005).

With regard to the latter, if an

organization delegates a portion

of its HR function to an external

vendor to lower costs, the HR

function will be restructured, and

employees will be displaced. This

change will generate concerns

among the remaining employees

regarding their job security and

may decrease their identification

with the organization (Belcourt,

2006; Elmuti & Kathawala, 2000).

Finally, outsourcing arrangements

might have adverse consequences for the cli-

ent company due to negative applicant reac-

tions (David, 2010; Wehner et al., 2012).

For example, David (2010) argued that out-

sourcing arrangements negatively influence

applicant reactions because they imply that

the firm itself offers a limited variety of work

and number of promotions. If organizations

assign special tasks to external vendors, they

signal to potential applicants that only rou-

tine tasks of the desired job will be conducted

in-house (David, 2010; Matusik & Hill, 1998).

In addition, Wehner and colleagues (2012)