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Overcoming the pitfalls of traditional recruitment metrics

Measuring the effectiveness of your recruitment process by using metrics like time-to-fill and offer acceptance rate isn't sufficient for a modern talent team. Let's get to the bottom of why that is and what you can do about it.  

Picture this: you have a manager meeting at the end of the quarter where you plan to share time-to-fill at the end of the month or the quarter to look at how your team performed.

You might be tempted to share your screen and show a dashboard or spreadsheet that with traditional performance metrics like time-to-hire or offer acceptance rate

This is the status quo for talking about your team’s performance, but how do you plan to take action on your metrics? How does it compare to the previous month or quarter? How does it speak to the quality of your process or candidate experience?

The bottom line is that traditional metrics fall short when answering any of these questions (or others that might come up in that management meeting). This is why you will need to supplement them with more modern, real-time, forward-looking, candidate-focused, and quality-driven metrics.

So, let's get into it.

What are traditional recruitment metrics?

Before we dive into why traditional recruitment metrics aren't enough, let's define what "traditional recruitment metrics" actually are.

Traditional recruitment metrics are the key performance indicators (KPIs) that organizations have historically used to measure the effectiveness of their recruitment process. These metrics typically include:

  • Time-to-hire: The length of time it takes to fill a vacant position.
  • Cost-per-hire: The total cost incurred to fill a vacant position, including advertising, job board fees, recruiter fees, and other expenses.
  • Applicant-to-hire ratio: The number of applicants who are eventually hired.
  • Interview-to-hire ratio: The number of applicants who make it to a first interview.
  • Offer acceptance rate: The percentage of job offers accepted by candidates.
  • Source of hire: The channel in which the hire originated (i.e., applicant, active sourcing via LinkedIn, a paid job ad, etc.)
  • Diversity of hires: The percentage of new hires from various backgrounds, experiences, and perspectives. This includes diversity across race, ethnicity, gender, sexual orientation, age, religion, nationality, and disability status.

…to name a few.

While there isn't anything inherently wrong or malicious with traditional recruitment metrics, the reality is that they just aren't enough. As a result, talent teams today are continuously looking for more sophisticated metrics that provide deeper insights into the recruitment process and the quality of talent being hired.

And thanks to a rise in data analytics and recruitment tools, teams today can glean additional context and access the real-time data they need to make meaningful change.

Because relying on traditional metrics alone might send you down a path of trying to fix something too late in the game.

Or even worse, trying to fix something that was never broken in the first place for the sake of being "data-driven."

Why are traditional recruitment metrics not enough?

Let's get to the bottom of why exactly they come up short. There might be more reasons than what we have listed below, but these are some of the more apparent flaws we see with traditional metrics across the board.

  • They are lagging, not leading. You only have insight into traditional metrics once the role is closed - and by then, it's already too late, making it difficult to act on them in real-time.
  • They neglect candidate needs. Metrics like time-to-fill and source of hire might tell you a lot about your internal process, but what does it say about the candidate experience? Nothing, really.
  • They assume recruitment is linear. If you are only making one hire or you have a very specific search period, time-to-fill can be a good indicator of performance. However, when you have continuous searches for high-volume roles (i.e., backend developer, sales reps), time-to-fill can become complex and not representative of performance at all. Because the reality is that recruitment today is cyclical, and process timelines can be infinite.
  • They are not quality-driven. Traditional recruitment metrics are often time and volume focused, which means they constantly push recruiters to get things done quickly, with little concern for thoroughness or quality. In other words, if you are goaling your team to hire fast, they will likely have to cut some corners (and quality) to meet that goal.
  • They lack comparison. Often, traditional metrics don't show the overall increase or decrease in performance over time (i.e., how you performed in Q1 this year vs. Q1 last year). Therefore, the metrics at face value act more as a benchmark than a signal of progression or indication of trends.
  • They are too high-level, aggregate, and quantitative. The world is obsessed with what you can measure. But unfortunately, aggregate quantitative metrics fail to capture the qualitative nuances in your hiring process. So even though you know that your cost-per-hire increased, you still don't really know why or how you can positively change it moving forward. This means you still need to analyze additional metrics to fill in the gaps around quantitative shifts.

What you goal your team against drives their daily decision-making and sets their priorities. And if you are measuring your recruitment team on metrics that are retrospective, aggregate, and volume-driven, you're likely to make iterations that are too little, too late.

Why metrics can you use to supplement your data?

You can implement several modern hiring metrics into your process to add context and keep a real-time pulse on how your process is holding up against your goals. While we won't go into every modern metric now, here are a few of our must-have metrics to get you started on changing the way you think about your recruitment data.

  • Delivery forecast. This data point is a health check regarding whether you feel confident about signing this role according to the set timeline and quality or if you suspect some delays. Delivery forecast is a real-time metric your team can use to understand what action they can take today to get the delivery back on track, rather than sitting in a meeting at the end of the quarter wondering where things went wrong.
  • Candidate conversion rates. Knowing what percentage of candidates move from one phase to the next is incredibly useful for understanding what parts of your recruitment process need the most attention. You can also slice and dice conversion rates by country, department, team, or even recruiter to see where candidates are either dropping out or getting rejected. By having this data live and available to your team in a dashboard or spreadsheet, they can make iterations quickly to address your processes' most urgent needs.
  • Interview hours per hire. Although this is a time-based metric, it digs a bit deeper into your team's effectiveness - because even if the time-to-fill for a particular role was high (i.e., it's the holiday season, a candidate fell sick), that doesn't necessarily mean your team was inefficient. Interview hours per hire can be a good indicator of hiring manager fatigue since you can flag the hours your team spends in interviews. This, stacked against candidate conversion rates, can further tell you how much time your team spends interviewing candidates that never make it through to the next stage. If your interview hours per hire are increasing, consider changing the interview loop for a specific role or changing up hiring teams when possible to avoid fatigue.
  • Pipeline diversity. This is a direct response to the traditional diversity of hires metric. While looking at the diversity of hires is still essential, there's just one problem. It's retrospective. To take this metric a step further, consider looking at the diversity of your pipeline to better understand where specific demographics fall out of your process. This will help you keep a real-time pulse on how well you're setting yourself up to meet your diversity goal and uncover where your process struggles to support diversity (and, more importantly, what you can do about it).
  • Reason for offer lost. As the name suggests, this is where you specify why your candidate rejected an offer. This data point is critical for adding context to your offer acceptance rate and making the metric actionable. If you know your offer acceptance rate is low, but you're not collecting data on why, making the meaningful change needed to bring acceptance rates up will be challenging. So, next time your offer gets rejected, log the data on why and use that information to uncover weaknesses in your process and/or offers (i.e., salary, advancement opportunities, misaligned values).
  • Quality of hire. This metric addresses the lack of quality focus head-on. But how do you actually measure it? Essentially, it's a combination of how the hiring manager feels about the new employee one year after joining the team, 12-month retention rates, and quantitative performance metrics. While the combination of objective performance data, retention rates, and hiring manager satisfaction will help you gauge the quality of your hire, this metric is still very retrospective since it has a one-year lag, so make sure you supplement quality with several real-time metrics.
  • Quality of applicants. This is a more real-time metric response to the quality of hire since you can actively gauge the applicant's quality as they enter the pipeline. In its simplest form, the quality of an applicant can be estimated by the number of applicants that move on to the first interview. If you have a high volume of applicants, but the conversion rate from from first to second interview is low, you might have a quality of applicants problem and should consider introducing more stringent screening.
  • Candidate Net Promotor Score (cNPS). This is one of the best indicators of candidate experience and can give your recruiting team insight into how candidates - hired or not - feel about the different stages of your recruitment process. You can check out one of our previous articles where we deep dive into cNPS if you want to learn more.

Additional data considerations

Using traditional and modern recruitment metrics to guide your hiring team is a sure way to ensure your team is measured on what matters, candidates are accounted for, and progress is measured over time. With that said, there are a few final considerations you should keep in mind when rolling out your new and improved data rig to your team.

  • Visualize your data. Nobody (especially management) will spend time looking at your data if they have to piece together the trends themselves.
  • Ensure everyone has access to live data. For the sake of transparency and a-synchronous communication, don't gate-keep your data. Make it open to everyone in the company and keep the link to critical takeaways top-of-mind.
  • Slice and dice when needed. Don't shy away from analyzing data by recruitment stage, role type, role seniority, internal team or department, applicant source, or even recruiter. By appropriately tagging each role with the right inputs, you can slice and dice data to uncover non-obvious trends and subsequent areas of improvement.
  • Input quality data. Even though we live in a world where it feels like almost any data point is at your fingertips - it's not. You won't be able to break down your data if you don't put in the work to input and tag the data appropriately. For example, suppose you want to measure pipeline diversity or drop-off rates by seniority. In that case, you must indicate which roles are junior or senior. You don't need an intricate tagging system to get to the core of your analysis, but remember that you don't get the high-quality output without high-quality input. We urge our recruiters to schedule in a recurring slot in their calendar for data entry, and even have slack bot reminders to ping them if their data entry is incomplete. This way, we ensure everyone is approaching data entry with the same quality standard.

In conclusion, traditional hiring metrics may not provide the complete picture when it comes to recruitment. While they can still be valuable, it's important to supplement them with more real-time, qualitative, and candidate-focused data. By doing so, you can make more informed decisions that result in a better candidate experience and a more robust recruitment process overall. So, take a look at your metrics and consider what additional data you could be collecting to give you a more complete view of your recruitment efforts.

Author profile Meagan Leber

Growth Marketing Manager at Amby, who loves writing about the tech, venture capital, and people space.