Measuring the performance of a candidate acquisition campaign requires tracking key metrics that can indicate the effectiveness of the recruitment campaign, highlight how well the campaign is working and point out areas where improvement is necessary.
In this first part of our two part series we look at five metrics that talent acquisition professionals like to see and will need for management reporting. These are essential in order to measure the impact of their recruitment strategy and to determine how things can be improved further. These basic metrics provide a good starting point for any recruiting professional and can be easily built upon to include more sophisticated analyses as more data is collected over time.
Number of applicants
Take note: tons of applications for a job opening is not always a good thing. In fact, it could mean that your job description is attracting the wrong candidates. Some insiders suggest an average of 50-60 applicants per job, a few even climbing into the hundreds.
Although every industry or situation may vary, it is a good idea to find a benchmark and stick to it. For instance, if the industry standard is 45 applications per job and you received 200, something may be off. This type of metric allows you to see if you are getting the right amount of applicants or if you need to rework your recruitment strategy, such as reviewing your marketing efforts or adjusting the job description.
Candidate Sources: Where did they come from?
It is important to figure out the sources for all your applications: these could be your careers website, social networking platforms, job search sites, your company’s Facebook page, advertising, social referrals, etc. This can show which channels are most effective in attracting candidates to your organization. It can also highlight how the various sources compare in terms of quality, quantity, speed and overall effectiveness in the final outcome. That is, which sources are most effective in resulting in great hires?
For instance, if you find that social recruitment and referrals bring you lots of quality leads, it may be something you want to invest more time and money into. Conversely, learning that candidates do not really utilize some of those previous generation job boards to find your particular opportunity can be a strategy you can nix in the future.
Metrics also show you ignore search engines at your own peril. According to one statistic, job seekers utilizing search engines are 30 percent more likely to complete the job application process. It also showed candidate quality was 25 percent higher from job hunters who took to search engines to sniff out opportunities. So ensuring talented searchers can find your company career page will prove important to attracting top hires. Talent communities were also important, proving to be about four to five times better than traditional job boards. Knowing where great candidates originate is an important way to better focus your hiring efforts.
Are you spending loads of money on each applicant or are you skimping a little too much? According to a recent SHRM report, the cost-per-hire for small organizations (fewer than 1,000 employees) runs around $3,079, whereas larger organizations (more than 1,000 employees) had a cost-per hire of $4,285. Larger organizations typically have a bigger budget and can therefore afford to spend more.
Understanding how much you currently spend on hiring these individuals can help you adjust your strategy, figure out if you are using enough resources or discover if you are totally off base and should be investing more in your recruiting strategy. You have the opportunity to go with the newer platforms that can help you get organized and can provide you with some of the most sophisticated capabilities to streamline your recruitment activities.
The time to hire metric basically means the time it takes to fill a position. According to the same SHRM report, on average, large organizations typically fill a position in 43 days while smaller organizations take 29. The reason for the longer time to fill for larger organizations is that they usually have more steps in the hiring process.
With this metric, recruiters are able to gauge if they are spending too much time when acquiring the right candidates or if they need to do a little more digging. Remember, do not jump on the bandwagon too quickly and do not over analyze your options. It can actually backfire in the long-run.
This is where growing organizations have an opportunity to really defy the industry averages by taking the lead with innovative technology platforms that not only help them optimize on the cost-per-hire but also greatly improve the speed with which they can find and recruit quality candidates. The average costs per hire in the industry clearly indicate the inefficiencies in the recruitment process and highlight the fact that hiring practices of most organizations are still utilizing older and expensive methods that continue to disappoint and therefore add to the overall costs of talent acquisition.
Quality of hire
According to ERE, the quality of hire metric is driven by “performance appraisal ratings and/or production 6 to 12 months into the new employee’s job as compared to their peers.” The quality of hire metric can be difficult to report since it can vary by organization or industry. However, once an internal benchmark is set, HR professionals can begin to assess the quality of the hire.
For example, an organization could measure the number of new clients a sales person acquires or the number of support calls a customer support representative closes in any given time period. If the company establishes that 10 clients per quarter is an acceptable benchmark for the sales person, HR can assess if the hired individual is able to perform at the expected level.
In part two we’ll talk about five more essential recruiting metrics. Until then, what hiring metrics do you find most useful? Let us know!