In September 2015, Rob McIntosh of ERE Media put together a phenomenal, comprehensive list of 19 trackable recruitment metrics. He explains that prior to the composition of this list, "you could find millions of results by searching for most of the basic recruiting metrics, but try finding out the actual formulas of how these metrics are made up, and there are few to no results, or they are hidden and not published."
But for most, his list is too comprehensive. Two months after the list's publication, John Sullivan (also of ERE Media), hit the nail on the head with his article "The 6 Strategic Recruiting Metrics That Executives Want To See."
Three years later, this is still an important distinction to make: there are many recruiting metrics that can be useful in some scenarios, but far fewer that are necessary in all — particularly as tech continues to influence recruiting standards.
These are the eight recruitment metrics you should take the extra effort to track in 2018:
1. Time to Fill
Time to Fill is the time it takes to identify a candidate and fill an open position in an organization. Tracking Time to Fill is imperative because it directly impacts your ability to onboard the most lucrative talent.
The average time to fill is 42 days. (Though this varies across industries, between 27 and 68 days. Either way, too long.)
For the enterprising talent acquisition team, this is a tremendous opportunity. With the proper application of artificial intelligence, hiring times of under a week are not unheard of.
With a hiring time of 42 days, imagine how many top candidates select employment at other organizations. For companies hiring in under a week, not only are they acquiring the best employees for their organization, they are avoiding the opportunity cost of missing out on top talent.
[Related: How to Close Candidates Faster]
2. Time in Workflow Step
Time in Workflow Step describes the time a candidate spends in each step (you should be able to see this in your ATS). Examples of workflow steps include phone screens, submissions to the hiring manager and interviews.
This metric is useful for identifying bottlenecks in the hiring process.
3. Quality of Hire
Quality of Hire (also known as First Year Quality), is the percentage of candidates submitted by recruiters who are accepted for employment plus the percentage of these that do not leave, divided by two. The resulting metric indicates the effectiveness of the recruiting team in identifying quality, loyal talent. It represents the distinction between more candidates and the best candidates.
This is a metric that matters tremendously to business stakeholders. If recruiters are submitting low-quality talent, hiring managers are wasting valuable time and resources filtering through them.
So how can this metric be improved? On the surface, it seems like something that can only be fixed retroactively, either by altering the recruiting team or changing the way candidates are submitted.
In years past, this assumption would be correct. But with artificial intelligence (AI), HireVue is able to build models based on the performance data of top performers — and feed this back into the initial recruitment assessment.
4. Submittal to Business Acceptance Percentage
Another way to quantify Quality of Hire is with the Submittal to Business Acceptance Percentage (SBA) metric. SBA is the percentage of candidates submitted by the recruiting function that are ultimately hired.
To calculate Submittal to Business Acceptance Percentage, divide the percentage of candidates ultimately hired by the number of candidates submitted to a hiring manager. For example, if 100 candidates are submitted to be interviewed by a hiring manager and 10 are hired, SBA is 10 percent.
This number will quite likely be different across departments.
Submittal to Business Acceptance Percentage is an excellent measure of how well recruiting is sourcing and screening candidates. A low SBA indicates that — for whatever reason — hiring managers are not happy with the vast majority of candidates they are receiving. A high SBA means recruiting is doing its job very well: finding the best possible talent for the organization.
[Related: 4 Signs You’ve Found an Informed Candidate]
5. Offer Acceptance Rate
This metric is a straightforward comparison between the number of candidates given a job offer and the number that accept — and its implications are far from simple. If your organization has an industry-low Offer Acceptance Rate, it is likely your offers are not competitive enough.
But the implications of a low Offer Acceptance Rate don't stop with lackluster 401k matching. If it comes to light that certain demographics are not accepting otherwise lucrative offers, there may be a systemic problem with your talent pipeline that makes these groups uncomfortable with your workplace.
6. Application Drop Off Rate
Application Drop Off Rate is the percentage of applicants who start, but do not complete, the application process. Improving this metric not only creates a better candidate experience, it gives your organization better access to top talent.
The traditional job application takes over 30 minutes to complete, is not optimized for mobile and requires extraneous information many job seekers are uncomfortable giving out. The best candidates know they are the best, and will not put up with a bloated application.
7. Candidate Net Promoter Score
Bottom-line observers are starting to notice the importance of Candidate Net Promoter Score (measured by survey during the hiring process) as we continue the march toward social media's ascendancy.
Net Promoter Score (NPS) is a metric commonly used to gauge consumer satisfaction, but it can also gauge the satisfaction of candidates. To measure NPS, ask candidates: "How likely are you to recommend this experience to a friend or colleague?" on a scale of 0-10. Subtract the percentage of candidates who answer with a "nine" or "10" from the percentage that answer between one and six. The resulting score can range from -100 to +100, with a score above 0 considered "good" and a score above 50 considered "excellent."
An unsatisfied candidate is no longer a voiceless unknown who will complain about their experience to a couple friends at dinner. In the 21st century, an unsatisfied candidate is an enraged Twitter account, an antagonistic Facebook page and a hostile Instagram profile. Your company's reputation among customers is no longer distinct from your reputation as an employer.
Virgin Media famously learned this lesson in 2014. In their first-ever "Rejected Candidate Survey," they uncovered that 18 percent of their candidates were customers — and 33 percent of these had such an atrocious experience they switched to a competitor. The revenue lost from these lost customers was estimated to be around $5 million dollars, the same amount they spent on hiring.
Building strong candidate satisfaction does more than ameliorate losses — it also has the potential to drive revenue. In the Talent Board's 2017 Candidate Experience Research Report (a survey of 100,000+ candidates), 74 percent of candidates who gave their experience the highest rating said they would also increase their business relationship with that employer.
8. Cost to Acquire
Cost to Acquire is a metric that measures the average cost to fill a position, from candidate attraction to onboarding. In large organizations, cost to acquire has measurable impact on the bottom line. In smaller organizations, it can make or break the yearly budget.
Cost to Acquire should be viewed in the context of the previous seven metrics. For example, a decreased Time to Fill usually results in a lower Cost to Acquire; an increase in Quality of Hire can help justify any increased expenditures. Cost to Acquire should inform your overall recruiting strategy, but it should not drive it.
This article was originally published on HireVue. It is reprinted with permission.