There’s no doubt about it — it’s challenging to measure performance management. And historically, it’s been even more challenging to apply these measurements to hiring and recruiting functions.
Despite the fact that companies have poured tons of time and money into developing hiring metrics, they haven’t provided much in the way of strategic impact. Mostly because many of them are historical in nature. You want to use predictive analytics to gauge what you need to prepare for-problems or opportunities that may arise in the near future-while covering your current time period. Reporting what happened last year or even last quarter has little value in the fast-changing business world.
So what kind of real-time metrics should you be using to make better hiring and recruiting decisions?
Instead of reporting internal metrics such as cost per hire, provide senior executives with metrics that quantify the impact of your activities on the bottom line:
- Quality of Hire, i.e. the performance level and dollar impact of your hires.
- Project delays or missed strategic opportunities caused by slow or low-quality recruiting. (Survey your project managers on a quarterly basis to create this metric.)
- Excessive position vacancy days. Every day that a revenue-generating job is vacant directly reduces corporate revenue.
- New hire failure rate. How many new hires had to be terminated within six months? Include failure analysis to determine what went wrong.
- Percentage of game changers hired. How many people have you hired that dramatically improved results in their role?
Use these forward-looking metrics to give decision-makers a heads up about upcoming problems and opportunities, so you can have buy-in and funding in place.
- Level of candidate availability/quality forecast
- Level of recruiting competition forecast – Gather competitive intelligence and uses it to predict whether your key talent competitors will be actively hiring, laying off, or are in a hiring freeze.
- Talent opportunity forecast – Keep an eye on LinkedIn and Glassdoor.com to see if top talent is beginning to exit a major competitor or that the competitor’s ratings are beginning to drop.
- Unemployment rate forecast – The unemployment rate in your area can cause changes in the available labor supply.
Finally, for your own use, try these measurements for continuous improvement:
- Offer acceptance – Identify the percentage of first choice candidates who reject your offer and choose not to work at your firm. If it’s high, examine your closing process and your salary levels so you can try to improve acceptance rates.
- Source quality – Identify which sources produce the highest quality hires and what percentage of the hires in key jobs came from sources that have the highest on-the-job performance, diversity, and tenure rates.
- Individual recruiter performance – Work with your recruiters to create an index that assesses and compares each recruiter on quality of hire, the use of effective sources, user satisfaction, and the number of hires.
What other metrics do you think would be helpful in improving your hiring process? Our recruiting specialists at Contemporary Staffing Solutions would love to hear your thoughts on the matter. Get in touch with us today to learn more about our managed staffing programs or recruitment process outsourcing services. We look forward to hearing from you!