Few would argue that many employers are underusing their HR and recruitment technology. In fact, according to a recent Deloitte survey, only 9% of employers feel ready for digital HR at all. So, how to improve? How to leverage technology for genuine – and measurable – process improvement. The key lies in that word, “measurement”.
How many? How fast? How good? Measurement and metrics are fundamental to any improvement and your recruitment processes are no exception. After all, if you don’t know where you’re at, how do you know where to aim for (or where is reasonable to aim for)?
Using your HRMS to track key metrics can provide genuinely useful insights, leading you to focus on the elements of your HR processes that offer most opportunity for improvement. And one of the most measured processes – with a wide selection of metric options – is recruitment. Improving your hiring processes depends on choosing the right metrics to measure for your organization, and choosing the right technology to support that endeavor. A useful starting point for the second ‘choice’ is our guide to HRMS recruitment, covering system features, pros and cons of integrated vs standalone technology, suggested systems, etc. The second ‘choice’ is explored here with a selection of recommended metrics to use.
Time to hire
Arguably, time to hire is the ‘classic’ recruitment metric; easy to measure, easy to understand. A simple definition is that time to hire is the time it takes from initiating the hiring process in the HRMS to the successful candidate accepting your offer of employment.
What can this tell you?
- How long it takes your process to identify the right candidate.
- Whether you have any pitfalls or sticking points in your hiring process (e.g., you’ve advertised, assessed, and chosen, but your new employee’s arrival is held up by your vetting or screening process).
Another level of usefulness is uncovered when you apply the “time to…” principle to individual stages within the hiring process. For example, how long does it take you to identify your candidates to interview after advertising the position? (And don’t just measure it, set a target: say, 14-21 days.)
Then there’s the time taken to bridge the gap between the deadline date on the advertisement and the interviews. This focuses on the sorting, parsing, assessing, and shortlisting of the applications you’ve received – a critical and potentially lengthy process.
Finally, how about the time between the interview/assessment of the successful candidate and their starting in the new role (in this scenario the “successful” candidate is the one who accepts your job offer; they may not be the first you make the offer to). Here, we’re still measuring the hiring process but this slice of time likely includes elements of your onboarding processes too.
Source of hire
Sure, you’re delighted to have found your ideal candidate for a position (and persuaded them to join you) but with the improvement of future recruitment campaigns in mind, it’s extremely helpful to know where you found this paragon. After all, there may be more of them!
So, what are the sources of your new recruits? Likely options include job boards, employee referrals, recruitment agencies, careers fairs… Once you know what percentage of your overall hires for a time period (often a year) come from each source, you’re in a position to focus more on those sources, for example, directing more of your marketing efforts to candidates coming via those channels.
There’s also the option to filter the data by subsequent job performance. For example, maybe only 10% of new hires come to you via recommendations and referrals from existing employees, however, when you look at performance, maybe 70% of your high-flyers and promotion prospects are coming from the same source. In this scenario, it’s worth looking at how you can further incentivize employees to recommend you as a place to work. Even though the numbers are low, the quality is high.
One warning… some candidates pass through multiple sources. Maybe a new hire saw the original job advertisement online on your Facebook page, but they only decided to apply when their cousin, who already works for you, encouraged them to do so. For each candidate, be sure which source you are measuring.
Offer acceptance rate
It may break the heart of the interviewer, but not every candidate you offer a job to will accept. Maybe the salary or benefits are deemed insufficient. Maybe they received an offer elsewhere while waiting to hear back from you. Whatever the reason, hiring managers don’t always get their first choice. Common reasons cited include:
- Decided not to leave their current employment
- Never intended to leave their current employment
- Not satisfied with the salary and benefits on offer
- Received a better offer
- The job requirements (e.g. hours, shifts, etc.) conflict with their personal needs (e.g. family commitments)
- No perceived promotion or advancement prospects
If this happens once in a while then there’s little or nothing to worry about. If it’s a significant level of occurrence, your recruitment process might merit some fixing. You’ll only know if you’re measuring the offer acceptance rate.
By tracking this rate over a period of time you can form a picture of how attractive you are as a potential employer, how competitive your reward and benefits are, and what the candidate experience of your hiring process was.
A general benefit of tracking recruitment metrics is that the resulting data and reports demonstrate the credibility of your recruiters and HR in general, measuring their contribution to the overall efficiency of the organization.
Finally, the focus here is the longer term quality of candidates and not only the efficiency of your recruitment process – hence the recommendation to measure periods of hiring activity of a year or so, it gives you more data to crunch (making the results more statistically relevant) and you can factor in candidate’s subsequent job performance.
For more information on finding the right HRMS to support your hiring process, try our recruitment software selection white paper.