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Micah Fairchild Capturing the Ever-Elusive Talent Acquisition Metric

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 By Micah Fairchild

Measuring the Effectiveness of Talent Acquisition

While current unemployment figures may belie this claim, there is a war for top talent going on in the global business landscape. Not just a competition; not just a single battle; but an all-out war—and figures from countless analyst firms and companies support this. For example, Manpower's recent research (in their 6th-annual Talent Shortage Survey) found that 52% of U.S. employers are experiencing difficulty filling mission-critical roles. Likewise, studies from IHRIM (International Association for Human Resource Information Management) cite that less than half of CEOs believe their company "has the skills necessary to perform at industry leading levels". These aren't issues that highlight a glut of unused workforce competencies, but rather an indication that there are fewer workers with the skills that employers need. As such, it's no surprise that one of Aberdeen's latest projects revealed that the top employer issue is "finding the right people at the right time".

Yet, finding these right employees isn't easy in this war, and requires diligence and concerted efforts in order to realize the full benefits that a well-placed hire can bring. More importantly though, the endeavor of finding the right workforce necessitates leveraging human capital business intelligence—no matter whether that insight comes from the recruitment sources themselves or targeted process improvement. Unfortunately, as is the case when considering the larger topic of human capital analytics, it would seem that far too many workforces have not availed themselves of the metrics needed to truly put forth a winning recruiting strategy. Whether due to the fact that these organizations are mired down in the day-to-day transactional activities of personnel management (and therefore not measuring talent acquisition at all) or simply approaching the recruitment metric from the wrong direction (using activity-based or poorly-defined measurements), organizations are woefully under-prepared when it comes to assessing and altering their talent acquisition strategies. To that end, we thought we'd distill down the most important aspects of recruiting metrics here; combining a little bit of best practices, a smidgen of benchmarking, and a dose of HR software reviews for good measure.

Which Talent Acquisition Metrics Are Companies Measuring?

While far from comprehensive, recent research from Aberdeen (in conjunction with hodesIQ) highlights that the talent acquisition metrics perceived to be of the greatest value for organizations are "Quality-of-Hire, Time-to-Productivity, Time-to-Hire, and Job-Vacancies-Outstanding". Though we'll go into further depth shortly about the merits of these particular measurements, it's important to note that these 4 talent acquisition metrics are the ones that rise to the top. Still, countless others have been reported as well; including "top prospect recruitment", "interviews-per-hire", "offer acceptance ratio", "external hire rate", and the list goes on and on. In fact, all total, organizations like the Corporate Leadership Council have compiled a potential list of well over 100 recruitment-centered metrics—a testament to not only the dizzying array of talent acquisition measurements, but also of the confusion that assessing recruitment strategies can bring.

Which Talent Acquisition Metrics Should be Measured?

Beauty is of course in the eye of the beholder—a sentiment that holds equally true when making blanket statements about talent acquisition metrics for all organizations (i.e. some measurements will fit business culture and strategy better than others). That said, many times metrics are used because they are easily calculated. I believe that there several recruitment metrics that have seen far too much of the limelight and add little to no organizational value (even if they are top-of-the-list according to Aberdeen's research). For instance, Time-to-Fill (aka how long it takes for you to fill a vacant position) is a widely-used measurement that tells little to nothing of consequence. It takes 30 days to fill an Engineering position? Is that good or bad? Even when coupled with benchmarking research that indicates industry averages, the fact of the matter is that every organization's goal is to hire as deliberately as possible without sacrificing time or quality. Period. Time-to-Fill may be an easy recruitment metric to capture, but it's the underlying issues behind that metric that are truly important. For example, are a company's top prospects selecting a different job because your hiring process is too convoluted? Do unnecessary talent acquisition bottle necks slow the process down? These are the recruiting elements that should be assessed rather than looking at the specific number of days it takes to fill a position.

Likewise, the recruitment metric "Job-Vacancies-Outstanding" is a proxy; which is trying to indicate at what level the company is functioning. Obviously organizations want to minimize how many open positions there are, but dedicating the time to assessing this metric won't net anything of true value. The same goes for the majority of talent acquisition measurements save for "Quality-of-Hire" and "Time-to-Productivity" (which in and of itself is simply a piece of the "quality" metric). Indeed, these measures are the gold standard for talent acquisition metrics—in large part because they take into account the underlying variables that an effective recruiting strategy must take into account. For example, what good is it if a recruiter doesn't know quality employees are being sourced from a particular venue? Similarly, if a candidate was hired quickly and cheaply but turned out to have serious performance issues, shouldn't that play a part in the recruitment process scheme? Essentially what I'm saying is that multiple data streams (i.e. hire source, performance, productivity, attrition, etc.) must match up to give you information about the quality of a particular hire. As Designs on Talent's Managing Director Linda Brenner puts it, "This kind of data, over time, would tell all of HR - and all leaders - where the best talent is coming from, where they reside in the organization, and which leaders create the best environments for nurturing and developing talent from within"; and isn't that what you're after with your recruitment anyway?

Concluding Thoughts on Talent Acquisition Metrics

Aside from the fact that the bulk of talent acquisition metrics are of little value, the fact of the matter is that these types of measurements are also backward-facing—an issue that means you're only getting your actionable information after-the-fact. Though not the focus of this particular blog post, my upcoming musings on this topic will focus on those talent acquisition software solutions that allow for predictive analytics—in other words, the stuff that recruitment dreams are made of. Even outside of that cutting edge of recruitment measurement though, HR software solutions are finally providing the types of talent acquisition intelligence that are needed. For example, IBM's Cognos, SAP's BusinessObjects, and Doublestar's Workforce Insight On-demand are all capable of distilling multiple streams into the actionable recruitment interventions an organization is after. Some vendors (e.g. Kronos, Roambi, PeopleFluent, etc.) have even taken to expanding on these capabilities through development of mobile recruiting analytics applications for tablets.

Regardless of the recruitment software solution chosen though, the bottom-line take away is that all assessment and intervention processes are only as good as you make them. Capturing the ever-elusive Quality-of-Hire stat for example is not something that can be addressed simply by getting a "good" hire through the company's door. Rather, concerted efforts must take place organization-wide; from hiring to development to performance management—areas that clearly require work from not only HR, but also hiring managers, top executives, and employees. As such, companies must always keep the end-goals for these talent acquisition metrics in mind—to find and place top talent within the organization. While the scattershot approach of gathering as much recruitment data as possible will net something, as Gartner's Thomas Otter puts it, "Data is useful only if you analyze it correctly and design interventions based on that analysis"—a clear indication that it's the right talent acquisition metrics that truly make a difference. End

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All total, organizations like the Corporate Leadership Council have compiled a potential list of well over 100 recruitment-centered metrics—a testament to not only the dizzying array of talent acquisition measurements, but also of the confusion that assessing recruitment strategies can bring.

 

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