In my experience, many companies still rely on the oversimplified KPIs – such as how many candidates applied, how long did it take to fill vacancies, etc. instead of the better and more insightful metrics.
The key to good recruitment metrics is to start with the strategic goals and objectives, then identify the questions metrics will help you answer, and finally identify the data and metrics that will help answer the key questions – instead of relying on either the KPIs you’ve already used, or the ones that are the easiest to measure.
Here are some better recruitment measures a company might use:
Costs per hire (analysed by channel)
Even companies using this metric often miss all the costs that go into a new hire. Recruiter fees or cost of advertising the position seem obvious, but what about time managers spend reviewing and interviewing candidates and any time associated with setting up a new employee? It’s also wise to break out costs by recruitment channel so that it’s easier to understand which channels cost the least and the most.
Again, while some companies do use this metric, they often aren’t looking at the whole picture. It is important to know:
- What is the turnover rate for a particular job description?
- How does that compare across departments?
- How long does the average hire stay on the job?
- And what is the retention rate for different pay grades?
Time to hire
From the time you post a job vacancy to the time the position is filled, how much time elapses? This is another metric that is important to analyse by channel and job position. If one channel produces results much more quickly than another, you want to know. It’s also very useful for predicting how long a position will be vacant.
Apart from costs and time to hire, there are other KPIs you should be tracking about your various recruiting channels, including:
- How many applications come in from each source
- How many of those applications are qualified
- How many short-listed applicants from each source
- And finally, where each successful candidate heard about the position.
Understanding these data about your sources will help you understand which channels are most effective for which types of positions.
Many studies have shown the benefits, from greater innovations to higher profits, of having a diversified workforce both in race and gender. Having this data at your fingertips can be useful in choosing from a group of equally qualified candidates.
Quality of hires
Going a step beyond the recruiting process is tracking how new hires perform over time. Tracking performance data, dollar impact, and even which employees are innovators and game changers can become extremely useful when cross-referenced with data about which channels were used to recruit top performers, which ads or descriptions were employed, and even information about employees’ work history or education.
When you have this sort of data available and can easily cross-reference, you can find some surprising and useful insights. One financial institution assumed that their top performers would come from top universities and Ivy League institutions. But when they correlated employee education with performance, they discovered that employees from mid-level universities were much higher performers, and they changed their recruiting practices accordingly.
For more tips on developing the right indicators for your needs head to our KPI and metrics section where you can find more articles, templates, and a KPI library.