This document discusses metrics for measuring recruiting performance and return on investment. It defines metrics as quantifiable measurements that can be compared to benchmarks and encourage behaviors focused on candidate quality and ROI. Traditional metrics like cost per hire and time to fill are criticized for not accounting for candidate quality. New metrics proposed include sourcing channels, recruiter efficiency, acceptance rates, candidate satisfaction, manager satisfaction, quality of hire, and efficiency ratio. These metrics better support business objectives by focusing on candidate quality rather than just cost and speed. Sample surveys and dashboards for tracking various metrics are also presented.

1. Recruiting metrics:
measurement tools for
today’s recruiter that
demonstrate return
on Investment SkillSurvey Webinar Series
Presented by:
Stephen Lowisz
Author, Educator and Speaker

2. Understand what metricsare
and why we use them
Understand why traditional
metrics may not support today’s
business objectives
Understand how to measure
metricsthat drive desired
recruiter behaviors and outcomes
Review sample metrics
dashboards
In this discussion
You will…

3. How do you define
metrics?

4. Standards of measurement that
HR professionals use to gather,
analyze and present important
information regarding the hiring process.
They are used to make better informed
decisions in order to receive
the best return on investment.”
(NAS Recruitment Communications)
What are recruiting
metrics?

5. Steve’s definition:
A Quantifiable Measurement
that can be compared to established
benchmarks
and
encourages behaviors focused on
candidate quality and return on
investment (ROI).
What are recruiting
metrics?

6. Advance the relationship between
recruitment and the hiring managers —
align the RIGHT objectives
Provide credibility to the recruitment
department by displaying that they
understand the overall business goals
and objectives
Define what is important and expected
of each recruiter
Drive consistency in delivery of
recruitment services to the organization
Provide a platform to measure recruiter
accountability and performance.
What do recruiting
metricsdo?
If we use metrics correctly,
they…

7. Be actionable and predictive
Be consistent in what they measure
Be tracked over time in order to generate
internal benchmarks and analysis of
internal performance
Be open to peer comparisons*
Be able to drive recruitment behavior
focused on “quality of hire” and
“return on investment”
The Bottom Line:
What gets measured, gets improved!
The purpose and importance of utilizing
correct recruiting
metrics
Effective recruiting metrics must…

8. Why are most metrics wrong?
The Lesson is Simple….Metrics must
derive from and align with business goals and objectives.
Metrics selection should only occur after
understanding the needs the metric addresses.
Most do it backwards! We create processes
around the metrics we want to see.
Example: Continental Airlines
• Post Bankruptcy
• Initiative only to reduce cost
• Reward Pilots for reduced fuel costs
• Result – customer satisfaction fell
and they went to competitors
The purpose and importance of utilizing
correct recruiting
metrics

9. What are you today?measuring

10. Cost per hireTime to Fill
more HR and a lot more transactional
Traditional Metrics:
Recruiter of the past:

11. Cost Per Hire:
• Only looking at initial cost and not the
long-term cost of hiring the wrong
candidate
• Does not account for “quality of hire”
• Does not consider the production the
candidate will/will not deliver
• Drives recruiter to “sell” candidates
internally
• Creates conflict between recruitment
and hiring managers
Recruiter of the past:
more HR and a lot
more transactional
Problems caused by
these
metrics

12. Time to Fill:
• Recruiter often manipulates ATS system
• Recruiter focuses on “lowest hanging fruit”
• Recruiter focuses on “filling the seat”
faster and cheaper, not better
• Focus is on immediate cost of vacancy, not
Long-term cost of greater turnover % and
additional recruitment costs
Recruiter of the past:
more HR and a lot more
transactional
Problems caused by
these
metrics
Recruiter of the past:
more HR and a lot
more transactional

13. Constant change

14. What is changing?
CandidateTrends
Recent economic uncertainty
has made employed talent more
passive and less likely to switch
employers
“My job isn’t great, but I’d rather stick
it out here than be last in - first out
somewhere else”
Percentage of new hires rated above
average has fallen significantly over
the past year
The percentage of very passive
talent willing to switch for better pay
has decreased significantly from
2006 - 2010
New hire satisfaction with the
recruiting process has fallen
significantly over the past year

15. Metrics focused exclusively on time to fill and
cost per hire have created conflict with the
business and potential candidates.
The profile of today’s recruiter needs to
dramatically adjust to support the needs of the
business.
What matters most to business leaders is not
always in line with what matters to recruiters
and their leaders.
Regardless of intent, recruiting metrics drive
specific recruiting behaviors.
What is changing?
The Conclusion:

16. What’s important to
your business?

17. What matters most
The Aberdeen Group Study
metrics

18. Develop and maintain a function capable of
identifying and recruiting qualified candidates
who have both short term and long term
impact on the organization — CANDIDATE
QUALITY
Provide a level of service that would be
considered “priceless” while driving down cost
and increasing return on investment
Key performance indicatorWhat do our leaders want?

19. How to measure?
What to measure?

20. • SourcingChannels
• Recruiter Efficiency
• Acceptance Rate
• Candidate Satisfaction
• Manager Satisfaction
• Quality of Hire
• Efficiency Ratio
Results-producing
Key Performance Indicators
Critical Success Factors
metrics and how to apply them

21. How to apply these
metrics:
• Difficult to track, difficult to define
• Source is only as good as the
recruiter who uses it!
•Track in ATS as source of candidate
• Report quarterly source of hire
•The percentage of new hires from each
defined candidate source
• Candidates should come from
multiple sources
• Using talent pools that are appropriate
for the position
• Active AND passive candidates
• Percentage per hire per source, with highest
on-the-job performance ratings
to measure:
Sourcing channels
metrics

22. Efficiency
ratio/acceptance rate
metrics
How to apply these metrics:
• Recruiter Efficiency/Acceptance Rate
• # Calls made compared to
# Return Calls
• # Return Calls compared to
# Candidates Developed
• # Candidates Developed to
# Candidates Presented
• # Candidates Presented to
# Hires
to measure:

23. • Phone call
• # of Calls Made 20 50%
• # of Calls Returned 10
• Screens
• # of Calls Returned 10 50%
• # of Candidates Developed 05
• Interviews
• # of Candidates Developed 05 60%
• # of Candidates Presented 03
• Offers
• # of Candidates Presented 03 42%
• # of Offers Made 1.25
• Hires
• # of Offers Made 1.25 80%
• # of Offers accepted 01
Results-producing
and how to apply them
Efficiency
Acceptance
metrics

24. How to apply these metrics:
Candidate Satisfaction
•The percentage of new hires who are
satisfied with the hiring process
Candidate Survey
• 4-6 Questions regarding process
• Scale of 1-5
• Positive experience improves
company brand and increases
referral rate
Results-producing
metrics

25. What would you ask
each candidate?

26. Candidate Satisfaction Survey
Lowest Rating = 0
Highest Rating = 5
Criteria Importance Rating
Number of interviews held 0 1 2 3 4 5 0 1 2 3 4 5
Scheduling and timeliness of interviews 0 1 2 3 4 5 0 1 2 3 4 5
Recruiter’s explanation of benefits 0 1 2 3 4 5 0 1 2 3 4 5
Length of overall recruiting process 0 1 2 3 4 5 0 1 2 3 4 5
Recruiter’s knowledge of position 0 1 2 3 4 5 0 1 2 3 4 5
Communication’s from recruiter 0 1 2 3 4 5 0 1 2 3 4 5
First day new employee orientation 0 1 2 3 4 5 0 1 2 3 4 5
Manager’s ability to lead and provide direction 0 1 2 3 4 5 0 1 2 3 4 5
Tools provided to complete job (computer, phone) 0 1 2 3 4 5 0 1 2 3 4 5
Job as described compared to actual position 0 1 2 3 4 5 0 1 2 3 4 5
Review of goals and objectives by manager 0 1 2 3 4 5 0 1 2 3 4 5
Recommend as a good place to work to others 0 1 2 3 4 5 0 1 2 3 4 5

27. How to apply these metrics:
Manager Satisfaction
• The percentage of managers who
are satisfied with the hiring process
Manager Survey
• 4-6 Questions regarding process
• Focus on key deliverables
• Communication
• Quality of Candidates
• Understanding of Goals/Objectives
of Position
to measure: Manager satisfaction
metrics

28. What would you ask
each manager?

29. Hiring Manager Satisfaction Survey
Lowest Rating = 0
Highest Rating = 5
Criteria Importance Rating
Timeliness of initial recruiter contact 0 1 2 3 4 5 0 1 2 3 4 5
Effectiveness of planning 0 1 2 3 4 5 0 1 2 3 4 5
Recruiter’s understanding of position 0 1 2 3 4 5 0 1 2 3 4 5
Process overview 0 1 2 3 4 5 0 1 2 3 4 5
Recruiter’s knowledge of market 0 1 2 3 4 5 0 1 2 3 4 5
Sourcing options 0 1 2 3 4 5 0 1 2 3 4 5
Quality of presented candidates 0 1 2 3 4 5 0 1 2 3 4 5
Quantity of presented candidates 0 1 2 3 4 5 0 1 2 3 4 5
Diversity of presented candidates 0 1 2 3 4 5 0 1 2 3 4 5
Information provided to candidates 0 1 2 3 4 5 0 1 2 3 4 5
Assessment of candidates 0 1 2 3 4 5 0 1 2 3 4 5
Offer/closing effectiveness 0 1 2 3 4 5 0 1 2 3 4 5
Recruiting costs 0 1 2 3 4 5 0 1 2 3 4 5
Communications from recruiter 0 1 2 3 4 5 0 1 2 3 4 5
Recruiter’s ability to solve problems 0 1 2 3 4 5 0 1 2 3 4 5

30. to measure: Candidate Quality
Why does it matter
metrics
• Greatest impact on the performance of each organization
• Financial Impact of poor candidate quality exceed twice the
candidate salary
• Quality is both specifications and performance
• Specifications answers the question: “Did we hire the appropriate
person?”
• Performance answers the question: “ Did that person actually
perform well in his/her job?”

31. to measure: Quality of hire
metrics
Quality of Hire Metric (6 Month Rolling)
PR – Performance Rating of new hire
EP – Employee Performance as a % of new employees
ER – Employee Retention of new hires after 12 month
N – Number of indicators used
QH = (PR +EP +ER) /N

32. Performance Rating:
• Average job performance rating of new
hires with at least 6 months of tenure and
hired in previous 12 months.
• Based on a numerical average.
• If based on letter ranking such as A, B, C,
convert to number and percentage.
• 10 new employees
• Average 3.5 out of 5.0 = 70%
to measure: Quality of hire
metrics

33. to measure: Quality of hire
metrics
Employee Performance %:
• % of new hires with at least 6 months
of tenure, hired in the past 12
months and meeting expectations.
• 8 of 10 are meeting acceptable levels
= 80%

34. Employee Retention %:
• % of new hires meeting expectations
and retained after 12 months.
• Same employees used in PR/EP
• 10 new employees/6 remain after 12 months
and meeting PR
• Average = 60%
to measure: Quality of hire
metrics

35. QH = (PR + EP + ER) / N
to measure: Quality of hire
metrics
Quality of Hire = (70% + 80% + 60%) / 3
QH = 70%

36. The Impact:
“One top notch engineer is worth 300 times or
more than the average. We would rather loose
an entire class of engineering graduate then one
exceptional technologist.”
Allan Eustace, SVP R&D Google
to measure: Quality of hire
metrics

37. The Impact:
• Google
o Average employee generates $1.3 million in
revenue.
o If the “Game Changer” produces just 10 times
more than an average employee’s performance
($1.3 million multiplied by 10).
o For every “Game Changer” Google hires it could
result in $13 million in new revenue each year!
o If that employee only stays 3 years, that is still $39
million in potential new revenue!
to measure: Quality of Hire
metrics

38. How to apply these metrics:
• Efficiency Ratio
• Is a more accurate measurement of
efficiency than cost-per-hire
• Takes into consideration that higher
paying positions are more costly to fill
• Includes differences associated between
compensation and candidate supply
• Includes candidate demand due to
variations in market, position level,
industry and geography
• Is the calculation of dividing the total
staffing (internal & external) cost by total
compensation recruited – 14.8% avg.
to measure: Efficiency ratio
metrics

39. Total Recruiting
Costs
Total Compensation
Recruited
Recruiting Efficiency
Ratio
to measure: Efficiency ratio
metrics

40. Dashboards
metrics

41. Dashboard: Sourcing Metrics
Source: Building a proactive sourcing function to fill Critical Positions, Rob McIntosh, www.linkedin.com/in/robmcintosh

42. Question
“What are the things we need to be doing to increase the passive candidate initial response %?”
“What are we doing to help with efficiencies around active candidate screening to determine
quality earlier on in the process?”
Dashboard: Sourcing Metrics
Source: Building a proactive sourcing function to fill Critical Positions, Rob McIntosh, www.linkedin.com/in/robmcintosh

43. Questions
“Does the talent pool of the target companies
support business demand for the next 3 years?”
“At current pace we will exhaust target companies
talent pools?”
“Do we need to expand targets or revisit profile
requirements?”
Target
Compa
ny
Total
Candidates in
database
Total
Hires
% We
reject
Candidat
es
%
Candidates
reject us
% of
hires to
applicati
ons
A 337 21 67% 9% (16:1)
B 222 13 57% 8% (17:1)
C 135 13 70% 8% (17:1)
D 533 16 71% 10% (33:1)
E 351 8 74% 7% (47:1)
F 64 1 80% 1% (64:1)
Dashboard: Sourcing Metrics
Source: Building a proactive sourcing function to fill Critical Positions, Rob McIntosh, www.linkedin.com/in/robmcintosh

44. Efficiency Ratio
0%
5%
10%
15%
20%
Qtr 1 Qtr 2 Qtr 3 Qtr 4
Actual Goal
Dashboard: Executive Summary

45. Recruiting metrics:
measurement tools for
today’s recruiter that
demonstrate return
on Investment SkillSurvey Webinar Series
Presented by:
Stephen Lowisz
Author, Educator & Speaker