There’s a saying, “If you can’t measure it, you can’t improve it.” However, measuring the performance of something is no easy task. Especially, when we talk about a company’s recruitment strategy or hiring process. The recruitment process plays a key role in a company’s journey; so is recruitment software, as they both bring worthy human resources to the organization.
Today, almost every company is using recruitment software. Studies show that over 98% of fortune 500 companies use recruitment software to level up their recruitment process. However, again, not every company that uses an ATS or any other recruitment software gets benefits from it. Measuring the ROI is always the key to success. So, in this article, let’s look into how to measure the ROI of your recruiting software.
Before that, let’s discuss the benefits of measuring the ROI of recruitment software.
Why Should you Measure the ROI of your Recruitment Software?
Improved Quality of Candidates
Quality is what matters the most when hiring employees. Also, it is majorly associated with the ROI of recruitment tools. The quality of a candidate is much more important based on the role you’re hiring and the skills the candidate must possess. If you’re hiring for a senior position, you cannot compromise on the quality of the candidate.
By determining how your recruiting software is helping you with hiring, you can plan for better strategies.
Increased Diversity
Diversity and Inclusion are critical factors for employees to choose a company. Also, many believe that AI recruiting involves biased decisions. To prevent recruitment bias in your organization, measuring the ROI of your recruiting software is crucial. You should always choose a tool that avoids asking gender, race and religion-related questions to improve diversity in your company. There are many better options out there, in case your ATS promotes bias in hiring.
Better Decision Making
Nothing beats a decision made using data. Recruiting software empowers you with data-driven solutions. Thus you can make decisions that help you in the long run. Data helps you in tracking and evaluating candidates and making the right decisions.
Many other benefits, such as flexibility, are not measurable. In the same way, there may be some potential challenges that slow down your recruitment process. You can easily avoid those barriers by measuring the performance of your hiring software.
Okay, now, without further ado, we’ll get into four ways of ROI of your recruitment software.
How to Measure the ROI of your Recruiting Software?
1. Time to Hire
The amount of time between when a candidate first enters your recruitment pipeline and the day they accept your offer is known to be time to hire. Time to hire is an essential metric as the time to hire also impacts the money you spend.
Studies show that recruiters spend most of their time on the interview process. The more days the position is open, the more money it costs your team to work again on running job ads and scheduling interviews.
In contrast, when you understand your average time to hire, you can quickly analyze the time-to-fill and which positions take longer to fill. Thus you can plan different strategies for different roles and improve your overall ROI.
2. Cost per Hire
Cost per hire is the average budget you spend on filling a single role. This is also a helpful metric as it enables you to compare your spending in a given time period. By knowing how much you spend on your recruiting software, you can save how much you spend on other external resources or recruiters.
3. Diversity Improvement
As we’ve already discussed, diversity plays a key role in any organization. It also impacts your recruitment process, as millennials want to work with companies implementing workplace diversity strategies. So, it is crucial to measure how your company’s diversity and inclusion policies have improved over time.
You must check if your diversity goals are met with the ATS you’re using now. If not, you will have to modify how your ATS functions.
4. Candidate Experience
Candidate experience has been the trending buzzword in the recruitment industry. It refers to how candidates feel about your HR team they communicate with and your company throughout the hiring process.
It’s essential to find out if the candidates feel the recruiting process is speedy and interactive. You also need to know if they would apply again or recommend you to their friends. Because candidates having a negative experience would write down reviews about their experience. And you know how important is the reputation of a company when hiring. Measuring the candidate’s satisfaction, you will have many chances to improve their experience and draw more returns on the time and money you’ve invested.
Not every candidate that enters your pipeline makes the hire. So, measuring these metrics accurately is vital rather than just looking into the number of profiles you source through your recruiting software. Hope these tips help you fetch better ROI on your recruitment software.
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