October 24, 2022 | Verifications

Why Outsourcing Employment Verifications Is a Smart Choice for Your CRA

Employment verification is an unpredictable, labor-intensive, largely manual process that accounts for only 10% of the average CRAs revenue while generating 90% of the frustration. Is conducting employment verifications with valuable, expensive internal resources worth all the headaches?

You already know the answer if you’re in the background screening business.

For all the problems it creates, employment verifications are inseparable from the overall package of background screening services end-users rely on for making employment decisions. If you were to give up on verifications, you might as well give up on criminal background checks, motor vehicle reports, and all the other higher-margin services you offer. End-users simply do not want to purchase background screening reports à la carte.

So, the question becomes, if you must do employment verifications — and for the sake of your business, you must — how can you make the verification process more profitable, less aggravating and less risky?

One increasingly common solution is outsourcing some or all of your CRA’s verification orders.

Doesn’t outsourcing mean giving up control? Not necessarily.

Whether it was a website redesign project that spiraled well beyond scope or an accounting mixup, every business has experienced at least one outsourcing nightmare. So, it’s natural to be skeptical of outsourcing something as central to your company’s profitability as employment verifications.

For most background screening companies, the primary concern around outsourcing is loss of control.

End-users can be extremely particular regarding how you conduct their verifications: “Call twice on the first day, wait a day, then call once more.” How could an outsourced team possibly integrate various end-user-defined calling patterns and other requirements into their workflow?

Another related concern with outsourcing is backlogs. It can take the typical CRA the better part of a year to emerge from verification backlogs. If the outsourced provider is also backlogged, wouldn’t outsourcing result in the CRA falling deeper into the hole?

These are legitimate worries and risks for your CRA. But with the right outsourced verifications partner, you can handle customized requests with even greater efficiency and stay out of the backlogs for good. As we’ll explain in the next section, the question isn’t can your background screening company trust an outsourced verifications provider. Some of the most successful companies we know  like Apple outsource manufacturing of the iPhone, one of the most complex devices ever conceived by engineers and the source of most of its profits and does so very successfully. So it’s not as if verifications can’t  be safely and efficiently outsourced, but rather, can your business continue to compete without outsourcing verifications? And if outsourcing is the answer for your CRA, how can you go about it in a way that allows you to sleep at night?

Three advantages of outsourcing employment verification

Outsourcing verifications (again, with the right partner) solves at least three of the problems that make employment verifications such a persistent source of headaches for CRAs:

1. The labor problem

A few years ago, CRAs could afford to pay a few dollars more per hour than other hourly employers. But now, in the wake of the Great Resignation, wages for fast food and retail jobs match or even exceed what the average CRA can offer. This is creating a job churn crisis in the background screening industry — at the worst possible moment.

Not only are CRAs struggling to attract and retain verification researchers, but training new hires is typically a months-long process that must be repeated each time a researcher quits.

How outsourcing solves the labor problem: Large background screening data providers have the scale and resources to attract and retain high-quality talent and to train and support researchers with sophisticated technology.

For organizations like InformData, turnover still is a fact of life, but it’s planned for, and as a result, has minimal impact on the service we provide. Investing millions into state-of-the-art call center technology eliminates most of the manual aspects of conducting verification calls; new hires are able to simply read off pre-written scripts - and select responses from dropdown menus to complete their verification calls. At InformData, the average new hire can ramp up to high production levels after only four training days.

2. The coordination problem

Outsourcing may not be necessary if your background screening company only has the volume for one full-time verifications researcher. But as you grow to need five researchers or more, challenges emerge, specifically, how to manage your team most efficiently.

How outsourcing solves the coordination problem: Outsourcing shifts the administrative headache of managing a large verification research team to another party. Your CRA is only coordinating with one customer success staff person instead of managing three, five, or a dozen or more researchers.

Background screening data providers such as InformData use the latest call center technology to route calls automatically to available researchers according to pre-programmed calling patterns. These patterns can be as complex as they need to be to satisfy even the most stringent end-user’s customization requests.

3. The problems of scale

The many frustrations and inefficiencies involved with employment verification become magnified as your volume increases. One job applicant misspelling a company name is easily corrected; several hundred misspellings can bring your verifications operation to a halt, disrupting your turnaround times and elevating your unable-to-verify rate.

How outsourcing solves the problems of scale: Outsourced background screening data providers deal in volumes many times greater than the average CRA. Hidden within the data on all those completed and incomplete verification calls are insights that — when uncovered through the proper analysis — can be used to improve the verifications process.

For example, at InformData, we’ve extensively studied the best time to call employers. We’ve learned that if we call during certain hours, on certain days, with certain companies, and people with certain job titles, our collection rates will be higher, and we use our dialing technology and leverage our staffing levels to make the most of these peak hours.

Here’s a great example of learned insights in our system: We’ve discovered over 22 common misspellings for the company Boeing. Now, when Boeing comes up as an employer, whether it’s spelled “Boing,” “Beoing,” or “Bieong,” our system recognizes the correct intent like a person would, only thousands of times more efficiently, and doesn’t miss a beat.

Smart businesses are smart outsourcers

Outsourcing doesn’t have to be a dirty word in the CRA business. After all, some of the world’s most successful companies engage in significant outsourcing.

Apple, known for the most beloved tech products on the planet, manufactures almost nothing itself. This is because Apple recognizes that it makes better business sense to focus on what it does best — design and development — and leave the manufacturing up to those who do manufacturing best.

Trying to be pretty good at everything usually results in a business that is best at nothing. That’s a dangerous place to be in a competitive market. 

Read our guide: Grow Your CRA the Apple Way

The same is true in the background screening industry. At a certain level of scale, the many complexities of employment verifications can overwhelm all the other services that your CRA wants to be known for and steals profit that could be used for activities that make the best impression on your customers.

People buy from CRAs they can identify as the best at something distinguishing. The solution isn’t to give up on verifications but to entrust your verification orders to a data provider- with the expertise, experience, technology, and size to transform your verification headaches into competitive advantages.

Get in touch and let InformData help you discover why outsourcing will help you with your verifications challenges.


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