How to Measure Recruitment
Ian J. Cook, CHRP
BC Human Resources Management Association
Introduction
Session overview
•
•
The Foundation
What are HR Metrics?
When HR should use metrics
•
•
•
•
Recruitment Metrics
How metrics link to recruitment
How metrics support recruitment
How to use your results
How to get started
“Far too many people – especially people with great
expertise in one area – are contemptuous of knowledge in
other areas or believe that being bright is a substitute for
knowledge. First-rate engineers, for instance, tend to take
pride in not knowing anything about people…. Human
resource professionals, by contrast, often pride
themselves in their ignorance of elementary accounting…
But taking pride in such ignorance is self-defeating.”
Peter Drucker, professor and management consultant, writer of several books and
articles including “The Practice of Management”.
Excerpt from “Managing Oneself,” Harvard Business Review March-April 1999
What are HR metrics?
 A method of quantifying the impact of HR, its programs and
activities
 Can measure both efficiency and effectiveness
 Effectiveness = outcomes, how well did we do?
 Efficiency = inputs, cost, speed
 Are ratios, not cardinal numbers
 Also referred to as: HR analytics, human capital metrics, Key
Performance Indicators (KPIs)
Measuring outcome not input
Measuring results not activities
What are HR metrics?
Understand the basics
Volume through the year:
•
•
•
•
# of Vacancies or Vacancy Rate?
# of Hires or New Hire Ratio?
# of Promotions or Promotion Rate?
# of terminations within 1st year of hire or 1st Year
Turnover Rate?
• Source of hire?
…which of these are metrics?
Why HR should use metrics
Good
idea?
Good
execution?
When HR should use metrics
Build a business case
Identify problem or
opportunity
Track progress
Review results
Manage risk
Built in accountability – who is doing what and when
Create transparency – who is doing what and why
Why recruitment metrics
1. One of HR’s primary responsibilities is to supply the right people, at
the right time, in the right place
- We own and manage the talent supply chain
2. The quality of the talent in the organization makes a big difference
to organizational results
- It is important to run an optimized talent supply chain
3. The costs involved in the recruitment process are a significant part
of the HR budget
- It is important to monitor and quantify how effectively and
efficiently this investment is being delivered
Recruitment metrics
Source
• Attract the right candidates
• Quickly source right capabilities
• Track changes or trends
Screen
• Sort the best from the rest
• Manage and clarify candidate expectations
• Remove future barriers or challenges
Select
Secure
• Run selection process
• Manage final selection decision
• Negotiate and finalise offer
• Arrange for orientation
Recruitment metrics
• Are we getting the right type of
Source applications in the right time frame?
• Do we invest time in the best people
Screen when it comes to the selection process?
• Are we satisfied with the quality of
Select people coming into our organization?
• How successful are we at securing our
Secure most preferred candidate?
Recruitment metrics
Time
Source
Screen
Select
Secure
Cost
Quality
The elusive “quality of hire”
How do you measure quality of
hire?
How do you define quality?
Some QoH possibilities
•
•
•
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Performance Rating
Promotion Rate in x years time
% of new hires retained after one year
Rate of productivity with other new
employees or current employees
It’s about buyer’s remorse and whose got it
New Hire
Organization
Resignation Rate
Involuntary Turnover
Rate
90 day or 1st year
Resignation Rate
90 day or 1st year
Involuntary Turnover Rate
Quality of Hire - what everyone else is doing
Top Methods Used to Assess Quality of Hire
Performance review
57%
Probationary period assessment
55%
Survey/feedback of hiring manager
12%
Interview with hires
10%
Formal testing (languages, literacy, skills, quality control)
9%
Reference checks or resume and cover letter evaluation
9%
Source: Conference Board of Canada
Recruitment metrics
Source
Screen
Select
Secure
Recruitment Metrics
•
•
•
•
•
•
•
•
•
External Time to Fill
External Cost per Hire
Vacancy Rate
External Offer Acceptance Rate
90 Day Turnover Rate (Vol or Invol)
1st Year Turnover Rate (Vol or Invol)
Diversity Ratio
Hiring Manager Satisfaction
New Hire Satisfaction
Recruitment metrics
Recruitment Activities
Source
Screen
Select
Secure
• Tracking candidate
pools
• Posting jobs or
sourcing candidates
• Pre-screening
interviews /
assessments
• Interviews or
assessment centres
• Re-location
programmes
• Orientation
programmes
Recruitment Metrics
• External Time to Fill
• External Cost per
Hire
• External Offer
Acceptance Rate
• 90 Day Turnover
Rate (Vol or Invol)
Using recruitment metrics
What the numbers tell us….
Metric Category:
Recruitment
Metric Name
Score
Vacancy Rate
2.7%
0.6%
0.9%
2.4%
3.1%
4.5%
1.7%
20
12.5%
0%
0%
0.7%
5.8%
12.1%
10%
12
0%
0%
0%
0%
5%
19.8% 19.7%
13
12.5%
0%
0%
0%
0%
11.3%
3.2%
12
81.3%
73.1%
95%
100%
100% 100.5% 95.9%
10
90 Day Turnover Rate
90 Day Voluntary Turnover
Rate
90 Day Involuntary Turnover
Rate
External Offer Acceptance
Rate
10th
Date Range: 2010 Q1
25th Median 75th
90th
Avge
n
Using recruitment metrics
Metrics identify
issue or
opportunity
Celebrate results
or alter plan
Monitor plan
implementation
and outcomes
Create plan to
drive
improvement
Implement plan
Communicating your results
What is the key message?
 Choose your core message, forget everything else
 Tell a “story”





create a 10 second elevator speech
provide evidence for your story
what happened in the past; what is projected to happen in the
future
tell audience why they should care
recommend a course of action
Tip: Provide both the good and the bad news to build credibility
and gain support.
Using recruitment metrics
1st Year Turnover = 100%
175
50%
> 30 DAYS
175
50%
96
>1 YEAR
Signs the labour market is heating up – again!
Median External
Time to Fill
Q2
Score
Q1
Score
%
Change
34 days
28 days
+21%
External Time to Fill increased this last quarter,
perhaps a outcome of lower unemployment rate.
Resignation Rates have historically moved opposite
to the unemployment rate. As more jobs become
available in the market, we will see a higher
vacancy rate.
Median Vacancy
Rate
6%
4%
+50%
1st Year
Resignation Rate
10.1%
7.4%
+36.5%
Avg Manager
Satisfaction Rate
90%
95%
-5.3%
Avg New Hire
Satisfaction Rate
70%
77%
-9.1%
Comments
The 1st Year Resignation Rate has been steadily
increasing over the last 1.5 years. The recruitment
team will be analyzing results from the New Hire
Satisfaction Survey and Exit Survey to determine
why we are seeing this trend.
Avg Manager Satisfaction Rate has decreased this
quarter for the first time in over a year, stating that
they are becoming dissatisfied with the longer time
to fill their roles. The team will continue to
monitor the Time to Fill.
How to get started
Use the glossary
 HR Metrics Standards & Glossary
 HR Metrics Interpretation Guide
How many metrics?
 Choose at least 3 metrics
 Choose at least 1 efficiency and 1 effectiveness
measure
 Add information, anecdotal or qualitative to tell a
story
How to get started
Source
Screen
Select
Secure
Recruitment Metrics
•
•
•
•
•
•
•
•
•
External Time to Fill
External Cost per Hire
Vacancy Rate
External Offer Acceptance Rate
90 Day Turnover Rate (Vol or Invol)
1st Year Turnover Rate (Vol or Invol)
Diversity Ratio
Hiring Manager Satisfaction
New Hire Satisfaction
Tips to get started asap
• Use Excel and find out how much source data
you already have
• Involve others and ask for help: HRIS, IT and
Finance
• Invest in inputting data correctly, consistently
and on-time
• Make everyone accountable, make it a job
requirement
Questions?
www.hrmetricsservice.org
Lisa Irish or Ian Cook
Lirish@bchrma.org
1.800.665.1961 ext. 125
support@hrmmetricsservice.org
Resources – web 2.0
Web 2.0
• Blog –
When Good HR Metrics Go Bad:
http://measuringtalent.wordpress.com
• LinkedIn –
Measuring Human Capital (group)
BC HRMA – Human Resources Management Association (group)
• www.ere.net for recruitment
Resources – through BC HRMA
Visit www.hrmetricsservice.org to get a copy of:
• HR Metrics Standards & Glossary
• HR Metrics Interpretation Guide
The Foundations of HR Metrics
November 16, 2010
Winnipeg
Linking Metrics to Strategy
January 25, 2011
Webinar
To register, visit:
www.hrmam.org
Resources – books
Investing in People: Financial Impact of Human Resource
Initiatives by Wayne Cascio and John Boudreau
Ultimate Performance: Measuring Human Resources at Work by
Nicholas C. Burkholder with Scott Golas and Jeremy Shapiro