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TDWI Upside - Where Data Means Business

How to Do Recruitment Analytics Justice: Treat It Like Sales Analytics

Use your sales analytics knowledge and skills to find and hire the best employees.

Many of us have been hiring in the dark, thinking that as long as we're doing what others have also been doing, everything should be fine. After all, what can go wrong with only replying to the ones you find interesting, asking unplanned interview questions, and dumping all other applicants once the vacancies are filled?

What if I told you that what you are doing is only replying to the ones you think are cool enough to buy your product, requesting to meet those prospects only to have aimless conversations, then cutting off communication with others once someone eventually buys your product.

If you think that is crazy, you are absolutely right -- and that is exactly what is happening to the "norms" in hiring: crazy processes. Nothing is measured, nothing is managed. It does not only drive job seekers mad, but also (silently) destroys your brand, be it an employer brand or a business brand.

If you have been thinking about making a change now and optimizing your recruitment, congratulations! You are already one step ahead. The steps coming next will be much easier.

There is a reason why I compare recruitment to sales -- they have striking similarities. Both require you to identify a certain group of people that can help you. Both require you to reach out and persuade these people to help you (either by buying your product or working for you). Both require extensive management. Applying the principles and analytics of sales to recruitment will provide you the perfect structure to follow and optimize your hiring further.

Candidates = Leads

First thing first: the situation only gets better when you treat candidates as leads. You will then stop amassing irrelevant CVs and actually start looking for the candidates that will improve your business' bottom line.

Just as you would use buyer personas to identify leads, use candidate personas to identify the job applicants you need -- not what you want but what you need -- in order to grow. Use two lists for the candidate persona: a "must-have" list (with the characteristics you need in the employee) and a "nice-to-have" list (with the extras you want).

For example, being proactive and able to solve problems are must-haves, and having a degree at a certain school is a nice-to-have. Document these criteria so all members of your hiring team can access them and know clearly what you are looking for. Having this upfront will save you tremendous time in deciding where to conduct your outreach and which applicants you'll put into the hiring pipeline.

Hiring Pipeline = Sales Funnel

There are many variations of sales funnels and just as many variations of hiring pipelines. Here we will look into the most typical sales funnel and its respective hiring pipeline:

  • Sale funnel: Visitors convert to leads and leads would convert to buyers
  • Hiring pipeline: Visitors convert to candidates and candidates convert to hires

To get the most actionable recruitment analytics, you need to set clear goals and conversion rates for each of these stages:

From Visitors to Candidates

Generally speaking, candidates can come from many sources. However, by registering the sources of your most qualified candidates (including those later become employees), you can determine where to double down on your job ad budget. More important, you can combine the sources with your candidate persona to optimize your job postings to improve your click-through rate.

With the candidate persona ready, you have a clearer idea of how to steer your employer brand to be appealing to that specific group. If you want to target remote workers, share stories of how your employees work efficiently and bond well regardless of distance. If you want to target millennials, explain the career growth opportunities. These messages should be clear on your career site -- the most important touchpoint for most candidates. Leverage your own channels, especially company blog(s) and social media, to gain exposure for your employer brand.

Most job postings on job boards redirect candidates to your career site, so measure the conversion rate of your employer branding activities by calculating the ratio of the number of unique visits on your career site to the number of applications you receive onsite.

From Candidates to Hires

The qualifying stage begins when you screen questions or have your first phone call with a candidate. Have your candidate persona in hand and verify as many "must-have" criteria as possible in the form of knockout questions (such as availability, relocation, salary range expectations, their current level of technical knowledge, etc.).

Calculate the percentage of candidates who make it through the qualification round. A low number (below 25 percent) means that something is going wrong in your communication. You may be targeting the wrong sources or have poorly written job descriptions and you'll know where to make changes.

A technical test is part of candidate qualification if a candidate's technical skills are crucial to your vacancy. The goal is to determine if candidates are truthful about their skills statement. The conversion rate here gives you a perspective about candidates' candor in the hiring process.

Interviews: By all means, do yourself a favor by conducting structured interviews. Each question should be designed to reveal whether the candidate's answer matches up to your "must-have" criteria, and each candidate is asked the same questions. To measure the conversion rate here, have a scorecard that helps you easily grade each of a candidate's answers so you can set benchmarks and calculate the percentage of candidates who pass.

Once you've selected a candidate, it's time for salary negotiations. Preferably you have touched on this point during the screening questions or your first phone call. Otherwise, you are likely to be back to square one by ordering something you cannot afford. Also, if the conversion rate is below 25 percent, you should revise your salary budget and expectation as soon as possible.

Assuming that you have your hire(s) at this point, are those not hired out of the hiring pipeline? Absolutely not. Just as you would have a lead-nurturing program to turn those leads into buyers later, you need a candidate-nurturing program. Make sure you have a system to store all qualified-but-not-hired candidates as segmented talent pools, where you know whom to reach out to immediately once you have new vacancies. The immediate benefit is saving time, of course; you simply need to update their data, see their growth trajectory, and decide if it fits your new "must-haves." Tracking the number of new hires from talent pools versus the number of new hires from other sources will inform your job ad budget as well as time-to-hire expectations.

Candidate Experience = Buyer's Journey

Always keep in mind that the hiring pipeline has two ends: you stand on one and the candidates stand on the other. Mapping what candidates expect and giving them good experience through each stage of the hiring pipeline is key to converting candidates to hires. Send surveys asking for candidates' feedback once they are out of the hiring pipeline. You get the valuable data to correct your hiring pipeline and get the chance to ask them to tell others who they think might be more suitable for the vacancies.

As a business grows, recruitment becomes one of the three pillars of its success. You want to build a great team, one team member at a time. Only through good recruitment analytics can you perform the actions that optimize the path to great hires every time. Sales analytics is a great place to start because you understand the cause and effect of numbers and processes there. Apply the same knowledge to your recruitment and let it pave the way to great hires.

About the Author

Perry Oostdam is the co-founder and CEO of Recruitee, a collaborative hiring platform for teams of all sizes. Recruitee helps optimize the entire hiring process, from candidate relationship management, employer branding, and job posting to candidate sourcing and applicant tracking. The company has offices and Amsterdam, The Netherlands, and Poznań, Poland and works with companies around the world.

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