Metrics can be gathered using information from various recruiting technologies, one-on-one interviews with those directly involved with the hiring process, and more. But making sense of all the data seems to be one of the most challenging aspects when using metrics throughout the recruiting process. Where do you begin, and what types of data should you be collecting?
Types of Metrics to Keep Track Of
Here is a brief overview of the types of metrics you should be tracking:
Time to hire. Perhaps one of the most widely used metrics, time to hire (also known as time to fill) is as simple as it sounds. This looks at the average amount of time it takes to fill a vacant role. That answer is usually then compared with relevant benchmarks, such as the industry average or perhaps the organization’s time to hire in months or years past.
Cost per hire. Because this metric directly shows the impact of recruiting efforts on the bottom line, it’s a favorite among executives. Simply calculate the internal and external costs accumulated during the hiring process, and divide by the number of people hired during that period. Which costs you include is somewhat subjective, but be sure to be consistent in order to compare across different time frames.
Quality of hire. This metric aims to make up for the shortcomings of the ones before it. Simply assessing costs and time required to fill a role does not take into account the success of the person hired—and therefore the success of the organization in finding the right talent and reducing overall turnover. How you measure the quality of each new hire depends in part on what role you’re hiring for.
For example, if you’re hiring salespeople, it may be relevant to assess the revenue they bring in or the profitability of the new business they generate. If you’re hiring someone to do manual tasks that can be measured in terms of rate of speed or some other productivity measure, that may be the relevant aspect to quantify. Or, if you’re hiring someone for a more subjective role, it may make more sense to assess quality based on performance reviews or other performance indicators.
Retention. While obvious things to measure, retention rates can make a big impact on recruiting efforts—keeping a good employee is obviously more cost-effective than finding a new one, no matter how good the recruiting team is!
Retention also matters when looking at the quality of new hires; if a new hire comes on only to leave within a few months, that individual’s contribution will be minimized, meaning that he or she was not a high-quality hire because that person did not stay. (Of course, this is a complex issue when it comes to retention, as hiring processes are not the only factor!)
Candidates per hire. It may seem counterintuitive, but most organizations will benefit when the number of candidates received for each role is not too high. This is because a high volume of candidates actually means much more work for recruiters and HR personnel to assess the individuals and determine who to interview.
When the number of candidates is far too high, it can mean that the job description was not clear in terms of job requirements, or it may mean that the recruiters and/or managers are unclear about what they’re looking for if they cannot narrow down the list efficiently (noting, of course, that in situations when high unemployment exists, the number of candidates will increase regardless of the recruiter’s efficiency or efforts to be clear on job requirements). Conversely, there should be enough candidates to have a few to choose from to help ensure that the right level of talent can be secured.
Source quality. This metric aims to assess how many candidates—and how many qualified candidates—you’re receiving from any given recruiting source. For example, if a job is posted on multiple external job boards, there may be quite a bit of variance in terms of how many prospects each source provides. This is one aspect of the metric.
The more important aspect, however, is to assess the quality of the candidates. If job board A provides five candidates but none are qualified, it’s not as good as job board B providing three candidates who are all well qualified. Pay attention to the number and quality of the candidates uncovered by various sources so you can assess which ones are worth the time and money.
Offer acceptance ratio. If you’re finding roles difficult to fill, it may be beneficial to assess how many offers are made that are not accepted. This can help to understand whether there’s a disconnect in the salary and benefits package being offered to new hires or if there’s something deeper at play that is keeping the organization from finding the right talent. This can also directly impact your cost per hire, as offers being declined means you have to redo at least some (if not all) of the recruiting process with the next-best candidate.
Satisfaction rate. This metric can be used in a couple of different ways. First, the organization can ask all employees (both new hires and existing employees) to rate their satisfaction levels. This is often done via employee engagement surveys and is a topic worthy of its own discussion, but it can provide insight into how well the organization is doing in terms of retaining people in the long term.
Separately, the new hire satisfaction rate can be assessed from the other side: the satisfaction of the hiring managers. Are the hiring managers satisfied with the new talent that has been brought on board recently? How do they feel about the hiring process and quality of talent that has joined the organization? Getting their input can be beneficial to improving the quality of hires in the future.
Building a System for Measurement
Now that you know what you should be tracking, it’s time to develop a system for measuring the correct information. Jason Roberts, Global Talent Acquisition Capability Leader at Accenture, recently presented a webinar on hiring metrics and offered detailed insight into how you can build a system of measurement so all your talent acquisition professionals are on the same page.
It starts with team meetings and one-on-ones. Roberts suggests conducting monthly goal-setting meetings during which you outline what goals your team will be responsible for in the month ahead. Do you need to increase your time to fill? Are you looking for better quality of hires? These are the types of goals you should be setting in your meetings.
As Roberts says, “You can’t hit a target you can’t see,” which means your goals need to be tangible, and your team needs to know what these goals are. Roberts suggests setting criteria for each meeting to discuss these goals. Such criteria should include:
- Goals based on your current requisition load,
- How individual recruiter goals can be tied to the hiring team’s overall goals,
- How these goals stack up against historic performance metrics, and
- Tracking the outcome of recruiters’ activity.
According to Roberts, “activity” itself is never a goal. Activity is what recruiters do to get to the goal. For example, measurable activities could include:
- How many candidates did the recruiter interview?
- How many qualified, interested, and available (QIA) candidates submitted applications after recruiter outreach?
- How many phone screens were conducted?
- How many outbound calls, texts, or e-mails were sent?
- How many résumés were entered into the database?
- And so on.
Sharing these activities during team meetings gets everyone on the same page about what they should be doing and how they should be going about doing whatever it is. Conducting regular meetings is a great way to develop your metric measurement strategy, but holding regular one-on-one meetings will drive this strategy home to all talent acquisition professionals on your team.
Roberts calls these meetings “deep dives” into what each sourcer/recruiter is currently working on and will allow you to review his or her progress against any existing requisitions. Roberts suggests keeping these meetings focused on “outcomes,” which can include:
- Pipeline yield—The required number of candidates per hire at each step of the recruiting process. This determines how efficient the organization is when making hires, the number of screens that result in a submission, and so on.
- Current volumes of candidates at each pipeline step—Do you have enough candidates to fill the need?
- Time to fill for similar positions—This helps determine which month a hire is likely to land. For this outcome, you’re using a little bit of prediction work by utilizing data you’ve gathered over a long period of time.
Setting goals is a great way to keep recruiters on track, and it’s also a great way to help your data mature. If your recruiters are keeping good records, you’ll be better able to use these data to predict future hiring needs, what is—and isn’t—working in your hiring process, and more.
Now that you understand what you should be measuring and how you can get your team on track, make sure you celebrate your team’s success when they hit their goals to reinforce this goal-setting, metric-tracking behavior.