Building an Effective Recruitment Function ~ 101

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The good old elevator pitch has always been one I’ve struggled with, mainly because I’m a talker!   So when someone asked me the other day to tell them what I do for clients in 1 sentence I thought this worked well as my ‘nutshell’ response….

“I help clients reduce recruitment costs, increase recruiter capability and supercharge Employer Brand”

That seems pretty simple doesn’t it?

okay thanks for reading…seeya tomorrow!…..

That’s probably not helpful to you if I just end today’s post there, and as this blog is all about sharing my knowledge and passion for great recruitment outputs and results with you, I thought I’d talk about what some of the key areas of focus should be if you want to develop your recruitment function to… reduce costs, increase capability and supercharge your Employer Brand.

Now don’t get me wrong, I’m not going to share EVERYTHING with you {that would just be silly}, but as I’ve worked in some great teams and worked and work for great companies, I’ve learnt a few things along the way.  I always assume that everyone knows these things which is always a bad assumption!

So here are just some of the basics.  I’m going to be writing on a number of topics that should be the foundation of any great recruitment function therefore entitled “Building an Effective Recruitment Function 101”.

Rule 1

Analyse it ~ if you can’t measure it, you can’t work out if it’s broken or not, make it better and improve it or understand what it means for your business (insights)

The first thing I try and do with any business that I’m working with is to understand what the current output is. And when it comes to efficiencies the question is:

Job 1 ~ Cost per hire

dollar

1a) How much are you spending on Recruiting in total

In total for all advertising, referral bonuses paid, salaries of recruiters, licenses for anything and everything to do with recruitment and any other costs, how much are you spending?

1b) Cost Per Hire (CPH)

Once you know how much you are spending, then divide it by the number of hires you are making in the same given period of time and work out what your CPH is.

I’ve found that on average it’s usually between $3-$5k per hire depending on your business, the talent you require and what your sourcing strategy is. Note that this is usually if you have a strong direct sourcing percentage.

Job 2 ~ Source Mix

source of hire

Once you know how much you are spending per head you are hiring into your business….. you now need to know what your source mix or source of hire is.
By understanding the source of hire you should be able to understand where you’re spending your money.

  • If all of your jobs are on job boards and are refreshed every day by recruiters then you could be paying a fortune in advertising
  • If all your jobs are hired through agencies then it’s easy to see that, that is where your spend is.
  • What about if you’re pouring money into social, meaning that your recruiters are sitting on that all day trying to build a follow and community but you’re not actually getting any hires out of that?   Well that will also drain the cash because you’re paying for unproductive heads in your team.

Have a clear understanding of how many hires you’ve made per sourcing channel and then cross reference that with your recruitment spend.

That’s job 2 done!

Job 3 ~ What is your time to hire?.

time

How long does it take you from the day the role is approved and open to the day that the candidates has accepted and/or signed on the dotted line?

Understanding this helps with a number of things.

3a) it helps you understand where your pain point are in your business.  Those pain points could be a lack of the skills in the market that you need.  It could also be hiring managers or processes that are holding up the process, it could also be your recruiters lack of ability to find those people or it could be bad process administration ~there are a long list of reasons why your time to hire is out of control.  It’s about digging and finding out what issues are there.

3b) This can also help you identify whether you need build talent pools/pipeline & or communities.   This is where it gets creative and proactive.

I constantly speak with clients who know that there are issues in their business but as it goes their teams keep doing the same things and expecting a different outcome.   This is where training and developing recruitment teams is essential.   It has to be part of the recruiters development plan to ensure they are up to date with sourcing changes and innovations otherwise you’re company’s ability to deliver in a passive and candidate driven market will deteriorate.

Okay so that’s just the first few things that you need to do.    I know it sounds so easy…. but it really depends on the systems that you have and whether you are able to get this information together quickly.  If you’re not, then your first step may be putting measuring tools or processes in place to gather this information asap.

We’ll be looking at building your sourcing strategy, talent pools and candidate engagement in upcoming “Building an Effective Recruitment Function ~ 101”  posts.

If you have specific questions or problems, then leave them in the comments below and I’ll add them to the long (and great!!) list of questions I gets!

Seeya and have a great day

Suz

2 thoughts on “Building an Effective Recruitment Function ~ 101

    Tim Baker said:
    May 29, 2013 at 2:41 am

    Just came across this through Twitter and makes for interesting reading. In an HR landscape where data is moving to the fore, the recruitment function has for a long-time been an advocate of numbers and measures. I was wondering if there’s any measure of quality of hire that people put in to practise? Most metrics I read seem to be quantative rather than qualititative. I understand the value of cost / time per hire if that assumes that all hires are of quality, but do businesses measure things like percentage of probation passes from the different sources? Maybe length of time until promotion and compare the numbers from the different sources? Over time could you measure performance ratings on hires from different sources and establish which is best and then invest in that area. Over an even longer-term, average length of service could be measured. I would expect that high scores on these areas are more important than short-term cost but in this market, I am probably being unrealistic! Would love to hear from anyone where this is happening.

      suzchadwick responded:
      May 29, 2013 at 10:19 pm

      Hi Tim,
      thanks for leaving a comment. I agree, this is just one of the initial stages of assessment of building a great recruitment function. The quality assessment is another part once you work through the recruitment process. My company, HudsonRPO has recently done some research on quality of hire and I’ll be blogging tomorrow about the findings of that report so stay tuned! It’s important for us to assess post hire how new recruits are tracking against internal performance management measures and to ensure that the competencies that we’re recruiting against meet the needs of the business longer term. I’ll be interested to know your thoughts on tomorrow’s post!
      Thanks
      Suzanne

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