5 recruitment metrics to learn from in 2018
Everything has come under scrutiny in the era of big data.
The smallest faults in processes and procedures are now identifiable with the help of numbers and formulas. Many of the early adopters of metrics have benefited from streamlined operations, improved margins and better productivity.
Now, the rest of the industries and fields that had initially waited to get on board are choosing to move full-steam ahead. Recruitment is one sector where adoption rates are quickly growing, and the trend is expected to continue well past 2018.
Reasoning behind it all
“People analytics” isn’t at all as dystopian as it sounds. In short, by identifying successful employees in a company, staffing organisations and human resource departments can better understand how their hiring practices led them to make that decision, or where they can improve. It removes bias from the equation and strives for high retention rates at lower costs.
People analytics helps identify areas of improvement for recruiters.
Adoption rates are moving slowly but steadily. Between 2015 and 2016 (the latest years the data was available) a Deloitte survey indicated an 8 per cent jump – from 24 to 32 per cent – in organisations that were confident in rolling out some form of big data analytics over the next year. Overall, four in every five enterprises felt the metrics were important to their overall human capital strategy.
Organisations are leveraging the findings in a variety of ways. From identifying indicators in candidates that would lead to unethical behaviour and put the enterprise in non-compliance, to figuring out which potential employees would pose a risk to leaving the company in less than two years. The data has immense value to the overall business strategy, but it can’t be acted on unless it’s adopted at the ground level: recruitment.
Fortunately, gathering this information has become simple with the help of recruitment software like FastTrack 360 Vega. Talent management systems are able to aggregate the data seamlessly without adding any time to the hiring process; using manual methods and legacy applications that don’t communicate with one another makes this an arduous task. It also doesn’t hurt that these systems are already being used to improve the recruitment strategy itself – in fact, it’s the icing on the cake.
Whether your organisation has already adopted hiring analytics to some extent or is still researching it, here are five metrics you’ll want to keep an eye on in 2018:
Let’s start with the most simple, but perhaps the most useful metric from which a company can gauge the effectiveness of its hiring practices. Time-to-fill is the average speed that a specific position is filled, and it can also be extended to cover every job posting within the business.
By tracking the hiring speed from when an opportunity is listed to when the contract is signed, organisations can identify areas that individual recruiters, or the staff as a whole, may be taking longer than expected to fill a role.
The insights could then be used to figure out a way to speed up the initial screening process, streamline interviews or even better understand which job boards lead to more qualified candidates.
FastTrack tip: Hosting commonly used applications through a single digital platform on the cloud can make an immediate improvement. Doing so allows for quick access to productivity tools, like being able to set preferences and exclusions on certain keywords on CVs.
Finding the best talent while using the least amount of resources is an excellent way to leverage hiring analytics for both staffing organisations and human resource departments. Here you’ll want to look at both external and internal costs, Analytics in HR reported.
Cost-per-hire can help prevent costly recruitment practices.
The former may cover advertising, time spent by recruiters and any other tangible expenses incurred from the moment the job was listed to when the agreement was signed. Internal costs can be much more difficult to quantify, but they include onboarding, the time taken away from managers and of course any reductions in productivity for anyone involved in the process.
From all of this we can glean a couple of insights. One example would be taking a second look at the channels you’re using to recruit; if you’re finding many of those candidates aren’t making it to the interview, it could be an indicator of wasted time, and therefore money. Another would be the exclusion of any unnecessary steps, like say bringing a manager in for the first interview.
FastTrack tip: Get an idea of what it costs your organisation to recruit for each position, and evaluate how to bypass or improve expensive aspects of it.
3. Offer acceptance rate
Offer acceptance rate is simply an indicator as to how many offers are accepted opposed to those that are declined, but it can prove useful in uncovering hidden flaws in business values.
Let’s take the technology sector as an example. While recruiters may feel the candidates want to hear about the compensation for the open position, the person being interviewed could in fact be more interested about the company’s culture. Use this metric to dig into the way the company is approaching the role – it could be that the salary is well below market rate, or people simply aren’t hearing the information they need to make an informed decision.
Similarly, a low offer acceptance could indicate issues in hiring practices. Candidates with experience in niche roles are highly valued in the technology sector. Is your company moving the right applicants through the process quick enough before a competitor has time to make an offer?
FastTrack tip: In the digital age, lack of speed should never be a reason why a job offer is declined. Ensure your recruiters have the tools they need to easily communicate with highly valued candidates so they aren’t poached by a competitor.
4. Retention rate
It should go without saying that the goal isn’t simply to bring new employees into the fold, but to find those who will stay with the company long enough to earn a return on its investment in human capital. By setting parameters – such as the percentage of hires who are with the company for more than one or two years – recruiters can reflect on the decisions they made.
Use retention rate to better evaluate future hires.
The insights here could range from developing a more targeted description of the opportunity to temper expectations on both sides, to better understanding which experiences and skill sets correlate with a high retention rate.
FastTrack tip: Intuitive recruitment software will provide reports that make analysing good or bad hiring decisions that much easier. Leverage these insights by including them in recruiter training and onboarding.
5. Channel cost
Last but not least is evaluating the cost of the specific channels your recruiters are using. With a wide variety of job listing websites available, you’ll want to compare the quality of each hire with where they were sourced.
Ultimately, recruiters should develop a list of job boards they can go to for specific positions based on historic success rates. Just because a channel is popular and has produced great candidates in the past doesn’t mean it provides the most well qualified applicants for every role.
FastTrack tip: Make it easy for recruiters to list an opportunity to a variety of job boards at once by leveraging an automatic posting tool found on recruitment software.
It’s time to take an analytical approach to hiring this year. Contact a FastTrack representative today to learn more.