Businesses generally invest a great deal of time and money in their recruitment activities. After all, every company wants to be seen as a top employer, in order to attract the best candidates. To ensure that this investment of resources yields the desired result, many employers would like to be able to track key performance indicators. These figures can help them not only to measure the effectiveness of their activities, but also to evaluate their success in meeting defined targets. However, the use of KPIs often presents a series of obstacles, so that many companies eventually decide against using this kind of tracking.
So in this blogpost we show you how to use KPIs effectively for recruitment, and how this can help to make your activities not only more data-driven, but also more efficient.
The major obstacles to using recruitment KPIs
The main reasons cited as to why many firms shun the use of KPIs in recruitment are the absence of suitable software, lack of time and insufficient expertise in statistics.1
In addition to these difficulties, arising even before implementation, there is also a series of further challenges which often only emerge once KPI reporting has begun. These include over-reporting, loosely defined goals and imprecise figures.
Lack of suitable software
Only 29% of companies have any dedicated HR analysis tool in addition to spreadsheet software like Excel.2 On the face of it, Excel may indeed seem like a quick and, above all, affordable alternative to what are often more expensive systems that have been specially designed for use in HR. With increasing volumes of data, however, manual administration and analysis of data becomes very time-consuming, and in many cases also very complex. So perhaps it might make more sense to use an analysis tool that has been specially designed for this purpose. Many applicant management systems now include their own reporting functions which you can use to track recruitment KPIs. By introducing this kind of software you can tackle two issues at once – you’ll improve your applicant management AND your data handling!
Lack of time
Data processing and management are cited in surveys as the most time-consuming aspects of recruitment.3 No wonder recruiters are not keen to grapple with yet more data. That makes it all the more important to digitise and automate as many processes as possible. As suggested above, it therefore makes sense to use suitable software. This deals with essential administrative tasks, so that you have more time to evaluate and interpret your data – bringing you a step closer to the candidates you want.
Insufficient expertise in statistics
Dealing with figures requires a certain amount of expertise. This is the only way you can be sure that you are measuring recruitment KPIs accurately and effectively. Many recruiters feel their skills in this area are inadequate, and so have decided not to undertake this kind of tracking. Many are also unaware that thanks to digitisation there are now many systems available that can carry out the collection, statistical analysis and evaluation of these data completely autonomously.
Over-reporting
Most companies tend to accumulate too much data rather than too little. This then makes it difficult to decide which of these data are worth analysing. And if you don’t think about this question in advance, you soon run the risk of over-reporting. All kinds of indicators are then recorded and analysed arbitrarily, without any clear objective in mind. This not only takes time and money, but also quickly leads to huge volumes of data that can’t be analysed. So limit your tracking – particularly at first – to key selected indicators that will help you to achieve your most important objectives. Over time you can then develop and expand on these as required.
Loosely defined goals
Tracking of KPIs in recruitment should not be a goal in itself, but should make a significant contribution to optimising processes and achieving defined targets. Many companies start out with the aim of improving their recruitment and thus saving time and expense. But what exactly do we mean by “improved” recruitment? And how can I measure whether or not my recruitment has “improved”? If there is no clear answer to this question, it probably means that the goal is too abstract and nebulous, and therefore too difficult to measure. This makes effective use of KPIs difficult. Particularly when it comes to gathering data for KPIs, your goal-setting should be guided by the SMART principle. This rule will help you to define KPIs that will actually enable you to achieve your objectives. It also makes it easier to identify specific measures that will optimise your recruitment process.
SMART goal-setting
S – Is the goal Specific?
M – Is it possible to Measure progress and success?
A – Is it Appropriate and Agreed by all stakeholders?
R – Is it Realistic and achievable?
T – Is it Time-limited, and will intermediate deadlines be set?
Imprecise recruitment KPIs
The individual recruitment KPIs may at first sight appear to be clearly differentiated. But on closer inspection this is often not the case. For example, if different companies are asked when their “time to hire” begins, the answers can vary hugely.They range from the point when the position is agreed and budget approved, to the point when the actual recruitment process begins.
These interpretations clearly illustrate the dilemma posed by imprecise KPIs. If your time to hire lasts 50 days from the point when the position is agreed, that is not necessarily a problem. But the picture is different if you need 50 days just for the recruitment process. In order to use your data to guide decisions that are actually valid, it is therefore essential to define clearly how you want to measure individual indicators, and what you mean by them. Which definition you use for the time to hire, for example, is entirely up to you. What’s important is that your decision is transparent and clearly explained
Conclusion
KPIs can not only help to measure the success of your recruitment activities. They also form the basis for further planning and the definition of new targets. However, what is important in this context is that you approach your data-gathering systematically and take active steps to overcome any obstacles. We hope that our tips will help you to optimise your reporting and wish you Happy Tracking!
1 2 3 HR Studie 2020: So steht es um die Digitalisierung der Personalarbeit, Lehrstuhl Personalwirtschaft und Business Governance der Martin-Luther-Universität Halle-Wittenberg, 2020
