Over the past few weeks, I’ve been talking with talent leaders from different companies around the world. The topics have ranged from developing a master recruiting blueprint to tracking recruiter performance one assignment at time. Unsurprisingly, everyone has different ideas, different approaches and different agendas.
However, over the years I’ve discovered six metrics that best predict quality of hire, individual recruiter productivity and overall department performance. Here they are in order of importance:
1. Candidates per hire.
If the number of candidates seen before one is hired varies widely or is too high, it indicates your entire hiring process is out of control. For high volume positions, a hiring manager should only need to see two to three people before hiring a person. Shoot for four if it’s a unique, critical or senior level spot.
Tracking candidates per hire and candidates being interviewed on a weekly basis can tell if the recruiter is effective, if the manager knows what he or she is looking for, or even if the person knows how to interview properly. This metric is also a leading indicator of candidate quality or if there is an inherent problem in the sourcing process.
2. Passive candidate conversion rate.
Getting a passive candidate interested in talking further is a tipping point. If you can’t get a top person interested in what you have to offer, you’ll wind up hiring the best person who applies, not the best person available. This is why I contend that the first person to talk with a candidate – especially passive candidates – is the most important person in the recruiting process. This person will determine the success or failure of any hiring initiative and a company’s ability to maximize quality of hire. A good recruiter needs to be able to convert 75% of the people contacted into serious prospects using advanced applicant control and needs analysis techniques.
3. Referrals per call.
The biggest billers in any search firm and the best corporate recruiters know how to get high quality referrals. In our training sessions, we spend a great deal of time training recruiters on how to get these referrals. If a top person is not a perfect fit for the opening, then it’s essential to get at least two high quality referrals from the person. One way to do this is to ask, “Who’s the best person you know doing this type of work?” These people are the highest quality people in your recruiting funnel. Getting them hired is what recruiting is all about, but it starts by getting their names.
4. Email conversion rate.
LinkedIn is a great tool for finding high performers using achiever-based search criteria. While getting the list together is a critical first step, getting them interested in your opening is the real challenge. I personally like to see response rates that are 50% or higher. Less than this means you’re shot-gunning your process. This compelling email for a VP HR spot got a response rate of 75% from a target list of about 65 people. Most often, you need a multi-email campaign to get to the 50% threshold.
5. Passive candidate call back rate.
As part of our passive candidate recruiting workshops, we emphasize the need to get high quality referrals through aggressive networking. While these people are difficult to recruit, they will maximize quality of hire if you can hire them. However, if they don’t call you back, it’s a wasted effort. Target 75% for this metric. Missing this is an indication that there’s something wrong with the company’s passive candidate recruiting efforts.
6. Job posting effectiveness.
I’ve just started working with one data analytics firm that is able to optimize how companies allocate their job postings and recruitment advertising expenses. The simple metric for all of this is the apply rate – how many people need to view a posting to get one to apply. If this is tracked by job board, you’ll be able to at least figure out which one is the most effective and gain a sense of candidate quality. By writing more compelling postings, you’ll be able to improve both statistics 3-4X. To gain a sense of your overall job board effectiveness, just ask those who do apply how long they’ve been actively looking for a job and why they responded to your opening. Note: you have a serious visibility problem if it takes more than a week for an active job seeker to find your posting.
These six metrics give a snapshot of the health and effectiveness of a company’s entire recruiting and hiring process. If a recruiting leader gets these under control, quality per hire will soar, cost per hire will decline and time-to-fill will shrink. More importantly, employee engagement along with hiring manager satisfaction will reach peaks never achieved before. Metrics do matter and these six matter the most.
*Image by dalioPhoto
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