The recruiting world has changed. As former HP president Carly Fiorina wisely stated, “The goal is to turn data into information, and information into insight.” New recruiting tools and technologies help us do this efficiently. HR software of today allows us to save time, automates the recruiting process, and provides us with large sets of data.
I’m going to let you in on a little secret: You don’t need to be a math major or a data geek to make sense of the hiring numbers, calculate ROI, or make the case to your CFO for a budget increase.
In this blog post, I’ll share with you some of the key metrics from the marketing world that I use as a marketing operations guy. You can definitely use these metrics in the recruiting world. I’ll help you to organize data, make sense of it all, calculate ROI, and become the Pink Unicorn of your organization.
You can read more about how the recruiter’s world is becoming more like the marketer’s in my previous blog post, “My Dots”.
1. Candidates = Leads
Candidates are similar to leads. One candidate can apply to different jobs at the same company once or multiple times. If one candidate submits three different applications, it will be counted as one lead and three inquiries. In terms of ROI, it is interesting to measure the following:
1. Net new candidates – the count of new candidates only.
2. Existing candidates – the count of candidates who were already in the system and applied again to the same or different position.
3. Candidates by channel – the count of new vs. existing candidates by free/paid channels (Facebook, LinkedIn, career site, etc…)
2. Applications = Marketing Inquiries
Marketing inquiries are just like candidate applications. If the same applicant submits three different applications, it counts as three inquiries or three applies. In terms of calculating ROI, it is interesting to measure the number of applications received during a certain time period, channel, or source. For example, when we look at data in Jobvite, we see that although job boards are the source of the most applications, referrals bring in the most hires (see chart B).
3. Recruiting Quality/Qualified Candidates (RQC) = Marketing Qualified Leads (MQL)
As many of you know well, there is a vast difference between the number of candidate applications and the number of qualified resumes you receive. It is interesting to measure what channel brings in the most qualified candidates in order to measure your ROI. Oftentimes, one channel brings the highest number of applications or candidates, but the quality is poor. Measuring RQC will help you to understand what channel is the most beneficial to your strategy.
4. Hiring Manager Accepted Candidates (HAC) = Sales Accepted Leads (SAL)
Further into the process, qualified candidates (on paper) go through the funnel; the number of applicants that get through to an interview with the hiring manager is much lower. Candidates can be qualified automatically by certain rules in your recruiting software, but they may fail to pass the phone screen with the recruiter. Anyone who makes it to the phone screen would qualify as an HAC.
5. Total Offers (TO) / Opportunities
Number of candidates who received a verbal or written offer.
6. Total Offers Accepted (TOA) / Signed Opportunities
Candidates who signed the offer.
1. Measure each of these metrics by channel to show ROI, and then invest in the channels that actually bring you quality candidates and are the most cost-effective.
2. Measure each of these metrics over different time periods to discover trends based on seasonality.