best practices 10 must-have metrics and benchmarks for better recruiting
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1 best practices 10 must-have metrics and benchmarks for better recruiting 15
2 If you can t measure it, you can t manage it. This phrase, coined by the nationally recognized consultant and author Peter Drucker, holds true across virtually every aspect of business. In today s recruiting environment, measuring the right things is more important than ever. With candidates searching for and applying for jobs from a multitude of sources from all over the world, creating highly effective recruiting strategies has become extremely complicated and challenging. Any recruiting professional who experienced the cost of a bad hire knows firsthand the value of better intelligence during each phase of the recruiting process. In a recent survey of nearly 2,700 employers, 41% of participants estimated a bad hire costs at least $25,000, with 25% estimating a cost of at least $50, And those costs don t account for lost productivity, hits to morale, and possible subsequent legal issues. The heart of the matter is this: Better company performance requires the Recruiting execution requires the right metrics for each critical best talent, which comes from the best recruiting. activity: Attracting and engaging talent and measuring results To fully understand your recruiting effectiveness, you need metrics across the entire hire to retire process. Simply measuring time and cost-to-fill is no longer enough. Instead, you need to measure the effectiveness of each stage of your hiring process, from marketing the jobs all the way to the long-term performance of those that are hired. Tracking the right metrics, and adjusting what s measured along the way, is what ultimately drives meaningful results. Consider a scenario familiar to many recruiting professionals: Your company just opened a new facility that needs to be staffed with highly specialized people quickly. Your recruiters scramble to fill positions without the necessary information and resources to attract, engage, and select the best candidates. Although the positions get filled somehow, the consequences of bad hires, attrition, and sub-par performance can take its toll for months, or perhaps years, to follow. Odds are there is little disagreement in your organization on the need for metrics. What is probably confusing, however, is exactly which metrics are most valuable. For example, data on candidate traffic from a particular source may be interesting, but it becomes valuable and actionable only when you combine it with hire data from the same source. If a source is producing high traffic, but low hires, then the action would be to dig further and consider changing the investment in that source. In such a situation, you would want to identify those aggregators who are driving traffic without corresponding results and shift resources to adjust your strategy. The following ten metrics and bonus metric cover several recruiting areas and have been shown to drive better recruiting results. 2 Here are the top metric categories your organizations should be thinking about: Career site performance: Monitoring and measuring your candidates first impressions Own your source: Creating and cultivating a talent community Use of free sources: Search engine optimization (SEO) Know your social media performance: Embracing the power of social media effectively Be mobile-friendly. Get moving on mobile 1 Source: careerbuilder.com, More than Two-Thirds of Businesses Affected by a Bad Hire in the Past Year, December 8, SuccessFactors client results 2
3 Career site performance: monitor and measure candidates first impression Your career site is often a candidate s first contact with your company. That means it needs to be carefully crafted to not only establish your employment brand, but to make candidates visits interesting, easy, and relevant so they come back. And of course the application process needs work smoothly to provide a natural progression to specific jobs. Key Metric #1: Number of candidate career site visits per completed application. Metric #1 benchmark: 92% of candidates who visit a career site do not apply on their first visit. Key Metric #2: Percentage of candidates who start the application process, but do not finish it. Metric #2 benchmark: 50% of candidates who start the application process do not finish it. Key Metric #3: Ratio of content that s about your company versus about available jobs. Metric #3 benchmark: 80% of your career site should be about helping candidates look for jobs; 20% should be about your company (culture, benefits, etc). Own your source: creating and cultivating a talent community Creating a talent community allows candidates who are not quite ready to change jobs to start building a relationship with your company. As a result, you can create an ongoing pipeline for filling positions as they become open. A talent community is a commitment from you it can even part of your brand promise. It s important that you invest the resources required to build and keep improving the talent community. Investing in engaging content and opportunities will pay huge dividends, even from existing sources. Key Metric #4: Percentage of hires from existing sources Metric #4 benchmark: Companies with their own talent communities typically see an increase of 25 40% in hires from existing sources. Key Metric #5: Percentage of completed applications from external sources versus the talent community. Metric #5 benchmark: Companies that encourage candidates to join a talent community before applying typically see an increase of 30 40% in completed applications. Key Metric #6: Percentage of true passive candidates captured (as measured by candidates who join the community but don t apply for a job for more than 30 days). Metric #6 benchmark: 25 30% of candidates will join a talent community and wait more than 30 days before applying. Use of free sources: Search Engine Optimization (SEO) SEO provides huge opportunities to cut through the clutter of online recruiting to attract talent directly to you. SEO efforts must be focused in the best places, however. Google obviously warrants a significant portion of SEO resources and effort, but don t ignore other major search engines. SEO will also greatly increase recruiter efficiency because more highly qualified candidates apply for open positions, instead of being deluged floods of irrelevant applicants from job boards. Key Metric #7: Number of applications-per-hire by source. Metric #7 benchmark: SEO takes, on average, 32 applications to get to a hire, versus 219 for job boards. Fewer applications per hire generally means the source is generating higher quality applicants saving the recruiters time screening. 3
4 Key Metric #8: Percentage of candidate traffic from each search engine (e.g. Google, Bing and Yahoo!). Metric #8 benchmark: 80% of job board traffic comes from Google, Bing and Yahoo!, with Google accounting for 85% of SEO traffic. Key Metric #9: Growth in candidate traffic from search engine sources over time. Metric #9 benchmark: In January, 2011, SEO generated 697,000 candidate careers site visits; in January, 2012, SEO generated 1,993,000 candidate visits. Know your social media performance: embracing the power of social media effectively Not all social media is created equal. Facebook is a prime mover in this space. Although Facebook delivers fewer candidates, they tend to be higher-quality candidates than LinkedIn. Facebook is an important sourcing component that can contribute greatly to quick placements and better recruiting productivity. If you haven t already, start thinking about how to include Facebook in your recruiting source mix. Key Metric #10: Applications-per-hire by social network source. Metric #10 benchmark: Facebook takes, on average, 31 applications to get to a hire, versus LinkedIn, which takes, on average 268. Be mobile friendly. Get moving on Mobile Information about your jobs needs to be available to candidates whenever they want it, wherever they are. Mobile devices are increasingly important for showing your open positions directly to candidates, and delivering qualified applications directly back to you. Bonus Metric: Percentage of career site traffic from mobile devices year-over-year. Bonus Metric benchmark: The graphic below shows the staggering growth of visitors from mobile devices for companies with mobile-friendly career sites. How to improve results with metrics: An example You can create real competitive advantage when you can measure the results of your recruiting strategies. While your competition is confused and overwhelmed by the rapid changes in recruiting, you can make strides in getting the best talent in your industry because you know exactly where to devote your recruiting resources. As you commit to disciplined measurement and factbased decision-making, you ll see results similar to those of fitness company Life Time, a SuccessFactors customer. By using the SuccessFactors Recruiting Marketing solution, Life Time experienced: Increased recruiter efficiency: 25% Reduced new facility time-to-fill: 18% Reduced turnover: 9% Increased revenue-per-trainer: 7% Not sure where to start? It starts with the right partner and the right tools to get you the right information and ultimately the best candidates. As an expert in recruiting metrics, processes, and technologies, SuccessFactors can help you define the strategic metrics you need to move the needle for your organization. Call us today for a complimentary consultation. 4
5 About SuccessFactors, an SAP Company SuccessFactors, an SAP company, is the leading provider of cloud-based Business Execution Software, which drives business alignment, optimizes workforce performance, and accelerates business results. SuccessFactors customers include organizations of all sizes across more than 60 industries. With approximately 15 million subscription seats globally, we strive to delight our customers by delivering innovative solutions, content and analytics, process expertise, and best practices insights. Today, we have more than 3,500 customers in more than 168 countries using our application suite in 35 languages. SuccessFactors Global Headquarters 1500 Fashion Island Blvd., Suite 300 San Mateo, CA 94404, USA 15 TOLL-FREE PHONE FAX EMEA APAC successfactors.com
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