How to Measure Recruitment BC Human Resources Management Association Ian J. Cook, CHRP

How to Measure RecruitmentHow to Measure Recruitment

BC Human Resources Management Association

Ian J. Cook, CHRP

IntroductionIntroduction

Session overviewSession 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?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)

M e a s u r i n g ou tco m e n o t i n p u tM e a s u r i n g re s u l t s n ot a c ti v i ti e s

What are HR metrics?What are HR metrics?

Understand the basicsUnderstand 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 metricsWhy HR should use metrics

Good execution?

Good idea?

When HR should use metricsWhen HR should use metrics

Build a business caseIdentify problem or

opportunityTrack progress Review results

Manage riskBuilt in accountability – who is doing what and whenCreate transparency – who is doing what and why

Why recruitment metricsWhy 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 metricsRecruitment 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

•Run selection process

•Manage final selection decision

Secure

•Negotiate and finalise offer

•Arrange for orientation


Source

•Are we getting the right type of applications in the right time frame?

Screen

•Do we invest time in the best people when it comes to the selection process?

Select

•Are we satisfied with the quality of people coming into our organization?

Secure

•How successful are we at securing our most preferred candidate?


Source

Screen

Select

Secure

Time

Cost Quality

The elusive “quality of hire”The elusive “quality of hire”

How do you measure quality of hire?

How do you define quality?

Some QoH possibilitiesSome QoH possibilities

• 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 itIt’s about buyer’s remorse and whose got it

Resignation Rate Involuntary Turnover Rate

90 day or 1st yearInvoluntary Turnover Rate

90 day or 1st yearResignation Rate

OrganizationNew Hire

Quality of Hire - what everyone else is doingQuality 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


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


Source

Screen

Select

Secure

Recruitment Metrics





Recruitment Activities

• Tracking candidate pools

• Posting jobs or sourcing candidates

• Pre-screening interviews / assessments

• Interviews or assessment centres

• Re-location programmes

• Orientation programmes

Using recruitment metricsUsing recruitment metrics

Metric Category: Recruitment Date Range: 2010 Q1 Metric Name Score 10th 25th Median 75th 90th Avge n

Vacancy Rate 2.7% 0.6% 0.9% 2.4% 3.1% 4.5% 1.7% 20

90 Day Turnover Rate 12.5% 0% 0% 0.7% 5.8% 12.1% 10% 12

90 Day Voluntary Turnover Rate 0% 0% 0% 0% 5% 19.8% 19.7% 13

90 Day Involuntary Turnover Rate 12.5% 0% 0% 0% 0% 11.3% 3.2% 12

External Offer Acceptance Rate 81.3% 73.1% 95% 100% 100% 100.5% 95.9% 10

What the numbers tell us….


Metrics identify issue or

opportunity

Create plan to drive improvement

Implement planMonitor plan

implementation and outcomes

Celebrate results or alter plan

Communicating your resultsCommunicating 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.


96

175 175

50%

> 30 DAYS >1 YEAR

1st Year Turnover = 100%

50% 50%

Signs the labour market is heating up – again!Signs the labour market is heating up – again!

Q2Score

Q1Score

%Change Comments

Median External Time to Fill 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.

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.

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%

How to get startedHow 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 startedHow to get started

Source

Screen

Select

Secure

Recruitment Metrics



• Vacancy Rate



• 1st Year Turnover Rate (Vol or Invol)

• Diversity Ratio

• Hiring Manager Satisfaction

• New Hire Satisfaction

Tips to get started asapTips 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?Questions?

www.hrmetricsservice.org

Lisa Irish or Ian [email protected] ext. 125

[email protected]

http://www.hrmetricsservice.org/

Resources – web 2.0Resources – 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

http://measuringtalent.wordpress.com/

http://www.ere.net/

Resources – through BC HRMAResources – through BC HRMA

Visit www.hrmetricsservice.org to get a copy of:• HR Metrics Standards & Glossary• HR Metrics Interpretation Guide

The Foundations of HR MetricsNovember 16, 2010Winnipeg

Linking Metrics to StrategyJanuary 25, 2011Webinar

To register, visit: www.hrmam.org

http://www.hrmetricsservice.org/

Resources – booksResources – 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

Documents

How to Measure Recruitment BC Human Resources Management Association Ian J. Cook, CHRP