Professional Documents
Culture Documents
Table of Contents
03 // Introduction 03 // A Few Highlights of this Study 04 // Methodology 05 // What Distinguishes This Report 05 // Why Automated Source Tracking is Most Effective 05 // Scope of Sample Size 06 // Source Effectiveness: Top Sources of Interviews and Hires 16 // Analyzing Data and Adjusting Your Strategy 16 // Conclusion: The Top 10 Findings 17 // Recruitment Analytics: How SilkRoad OpenHire Can Help in Tracking Sources 19 // About SilkRoad
Introduction
Companies around the globe are intent on reducing the impact of an uncertain economy on hiring. When hiring budgets are thinner, HR professionals must continue to look for ways to make the most of precious recruitment dollars, all while positioning their companies for future growth. In fact, in difficult economic times, recruiting the best-fit talent becomes more crucial than ever. good recruitment sourcing, in fact, is based on sound decision making and HR strategy. Yet every recruitment professional at some time in their career has witnessed the ready, fire, aim approach to sourcing. Panicky last-minute ad buys and stacks of resumes from unqualified candidates are only a few symptoms of this method. Haphazard sourcing of this type impacts company visibility and the success of the business. So how exactly can companies avoid this situation and make sound decisions that deliver real business value? The answer is straightforward: use hard data and employ analytics. Organizations must be able to see patterns in the data they have and use that information to guide their decisions about future spending. The problem is, though, that many talent management professionals still lack hard, factual data to be able to empirically identify the most effective sources of recruitment marketing. They share information about their best sources with colleagues, but much of this is anecdotal. Furthermore, the industry has relied on narrow studies of a few companies and a small number of recruitment sources, as well as surveys of recruitersrather than on hard data originating from real recruitment systems. However, with advances in automated applicant tracking systems (ATS) and the entry of the Web, the sourcing picture has shifted. With the right tools in hand, professionals can pinpoint exactly where applicants and hires originatewhether a job board, a search engine, a print ad, or a referral. Thats where SilkRoads Source Effectiveness Report comes in. This report was designed to aid professionals in understanding the recruitment sources used by a large number of other organizations, so that they can assess their own sourcing efforts. Accurate and substantial in scope and depth, this report delivers quantitative data about the sources that provide companies with qualified interviews and hires. The data was extracted directly from the talent management systems of some of the worlds largest companies and leading employers.
More detailed findings, analysis, and a complete summary of results can be found in the following pages.
Methodology
Survey data on recruitment sourcing certainly has its uses: It can be rich and textured, revealing respondents perceptions, processes, methodologies, and satisfaction with the tools and benchmarks they employ. While valid, it is quite different in nature than primary, objective data. Survey participants often respond with top of mind answers and reflections, rather than digging into their metrics for fact-based answers. This limitation is further compounded when the effectiveness of recruitment marketing sources is evaluated from the perspective of job performance after the candidate has been hired; at that point, even more potentially subjective criteria can color the findings. Even recruitment metrics that attempt to separate and evaluate source of hire as a measure of effectiveness often introduce a level of posthire measurement and subjectivity. The other key limitation of studies evaluating the effectiveness of recruitment marketing sources has been their limited scope. Most studies have focused on a small sample or drilled into a single industry or one category of recruitment source. Few, if any, have covered the recruitment landscape in both breadth and depth. The data elements that recruitment consultant and author Stephen Lowisz suggests are necessary that an organization track to determine what will drive the right results for sourcing are: The number of hires by source The quality of hire by source, meaning high on job performance and tenure rates The efficiency of the source, meaning how much time does a recruiter spend using a specific tool, such as Facebook or LinkedIn.1 Obviously, the number of hires by source in a certain time period is a critical piece of information. Many organizations use this metric with other measuressuch as external costs for agency fees and internal costs for staffing efforts and physical infrastructure. 2 Together, these elements are used to calculate cost-per hire, a prevalent industry measure of source effectiveness. The cost-per-hire metric is referenced again in this report, along with other forms of measurement. All of the calculations above are entirely data-driven and should be at the fingertips of professionals. In recent years applicant tracking systems and analytical techniques have evolved significantly, enabling companies to dig into very large data sets and harness their data for better decision making. Professionals must use hard data and employ analytics to make sound decisions that deliver real business value.
1 2
Stephen Lowisz, Source of Hire: Do you know? Should you care?, www.stephenlowicz.com, April 2009 An American national Standard for Human Resource Management, SHRM, February 2012.
note that the numbers shown above for postings, applications, interviews, and hires grew on a year-over-year basis, from last years report to this years report. This was a result of an increase in customers participating in the study, from approximately 800 in 2011 to 1054 in 2012.
3 4 5
An American national Standard for Human Resource Management, SHRM, February 2012. Dr. John Sullivan, The Silliness of Measuring Cost Per Hire, www.ere.net, August 6, 2012 note that of these 3,500, approximately 200 sources accounted for 95% of interviews and hires.
External sources provide the majority of interviews (56%) as opposed to internal sources, which provide 44%.
However, internal sources produced more hires (58%) compared to external sources (42%).
Results show that external sources are more effective in generating interviews. Yet, we can see from the chart shown above that once an applicant has made it beyond that critical interview stage, internal sourcing produces more hires. Later in the report, we examine those internal sources and others in more detail, which will provide additional context for this finding. This year shows slight gains in external sources compared to last year: For both interviews and hires, external sources gained roughly 6% compared to findings in last years report.
*Unspecified job board includes responses where the job website was not specified. Examples include Internet Job Board, Job Website and Online Job Board.
REMInDER
External online sources included specific job search engines, and branded and unspecified job boards. External offline sources included agencies, job fairs, and print advertising, among others.
Internal Sources: Referrals Predominate for Hires, But not for Interviews
Although employee referrals remain the strongest base for effective recruiting in terms of hires (44%), they were actually tied with company websites for interviews (36%). Internal hires accounted for most of the remaining activity from internal sources. 93% of interviews and 94% of hires came from these three sources, i.e. referrals, company websites, and internal hires. One explanation for the dominance of employee referrals might be as follows: A personal reference or recommendation could be heavily weighted in the hiring decision. Or, it is possible that a current employee clearly understands the qualifications that make a candidate the best fit for an organization.
FAST FAcT
36%
Referrals and Company Career Sites effectively tied for number of sourced interviews.
FAST FAcT
Online recruitment efforts are crucial for delivering the kinds of candidates that companies interview and hire.
Yet, a company career site offers more than just a group of job listings and a way to apply for positions. It provides a unified brand image, which can reflect the culture and history of an organization, beyond just a job description. A great career site can include encouraging messages from management, testimonials of employees and customers, information about company philosophy, and more. Because all this information is conveniently stored in one place, the candidate experience is amplified. In fact, the company career site is a storefront, where a vital stage of recruitment begins. The conversion of a job seeker to an actual applicant happens at the career siteno matter where the person started to hunt for jobs. Company information presented on the site helps the potential recruit decide whether he or she is the right fit for the job and organization. In short, the company career site gives the candidate the stimulus to apply for a position. Within this study, company career sites were the top online source of hires and the second most prevalent online source of interviews.
nES Rentals nesrentalsholdingscareers. silkroad.com nES Rentals, a leader in the $25 billion equipment rental industry, has a strict emphasis on safety and attracts top technicians, field and shop mechanics, drivers, and salespeople. To engage the best talent, nES Rentals uses SilkRoad OpenHires built-in Career Portal. nES Rentals has a content-rich Web portal for candidates, agencies, recruiters, and hiring managers to use. The portal is packed with high quality content, including testimonials from employees, and information about employee benefits, development, and recognition programs.
Note: Only the 10 largest External Online sources are shown on the graphs. The remaining 3,400 sources were highly fragmented. Each of them had less than 1% share of interviews and hires. Therefore, the numbers shown in the graphs do not sum to 100%.
A Lesson in Analytics: The Impact of Job Search Engines vs. Job Boards
Its important to note that the impact of job search engines in the previous two charts might be either underrepresented or different within your organizationdepending upon the level of integration between your ATS software and search engines. Heres an example: For its customers, SilkRoad has established integration or feeds with Indeed and Simply Hired, ensuring a consistent experience and current job information for applicants. However, if your ATS vendor does not provide direct integration or feeds to job search engines, candidates could be directed to another job boardrather than to your career site. In this case, your organization runs the risk that potential applicants are viewing outdated job postings. Moreover, your organization would not be leveraging the strength of its career site. There are also differences in the way that job boards and job search engines price their services. Job boards charge employers for posting their positions. In contrast, job search engines list employers jobs for free in their organic search results and only charge for additional job-seeker traffic on a pay-perclick basis. To put the power of job engines in further context, these two sources alone (Indeed and Simply Hired) accounted for 33% of all external interviews and 24% of all external hires.
In summary, these findings provide a lesson in analytics: When evaluating recruitment marketing, it is crucial to drill down into the data and to understand the way sources work. A particular source could look good under initial analysis, but when examined more closely, it might not deliver the highest return on investment for recruitment dollars spent. More thorough analysis prevents an organization from making haphazard decisions.
One final note on the overall importance of job boards as recruitment sources: According to Bersin & Associates, talent acquisition spending in the u.S. alone grew between 2010 and 2011 to nearly $3,500 per new hire, with most dollars going to job boards and search agencies.6 Therefore, even though job search engines in this study accounted for a disproportionate amount of online recruitment activity, job boards are getting a substantial chunk of companies recruiting budgets overall.
6. Of all internal recruitment marketing sources, referrals remain the strongest source for hires (44%). Internal hires followed at 26%. 7. Of internal recruitment sources, Referrals and Company Career Sites effectively tied for number of sourced interviews at (36%). 8. Of the online sourcesinternal or externalIndeed provided the largest percentage of interviews (27%) and company career sites accounted for the largest number of hires (30%). Findings indicate that company career sites are a crucial part of the recruitment marketing mix. 9. At first glance, it appears as if job boards outperform job search engines in this study. Job boards produced 54% of external interviews, as compared to job search engines, which produced 33% of interviews. Job boards provided 56% of hires, whereas job search engines provided 24%. However, this finding must be tempered: There were dozens of job boards in the study versus only 2 job search engines. Indeed and Simply Hired account for a disproportionate amount of recruitment activity38% of external online interviews and 29% of external online hires. Considering the small number of job search engines in the study, the numbers accounted for by engines are impressive. 10. careerBuilder was the leading source of interviews and hires among job boards, providing 127% more interviews and hires than the next largest source.
An ATS with automated source tracking works behind the scenes. The system identifies the source and reports it, removing any subjectivity or interpretation on the part of the job seeker. The benefits are: More accurate recruitment source data More reliable data to measure sourcing effectiveness A speedier application experience for the job seeker unfortunately, some ATSs still do not support automated source tracking in any capacity. Instead, they simply offer employers the option to enable job seekers to manually select the source they used, typically choosing from a list or by typing in the source. Research has shown that this kind of manual source reporting is prone to applicant mistakes: selecting the first available choice by default, omitting sources, and including more than one source or listing expired sources. When this is the case, recruiters and HR leaders receive faulty information and cannot make sound decisions about the sources that deliver candidates. Even when automated source tracking is offered, as it is with SilkRoad OpenHire, many employers and sources fail to implement it correctly. For example, an analysis of this data showed that a surprising number of interviews and hires were attributed to other. This category other was offered to candidates as a self-selection option by employers for sources that were either unable to be tracked automatically, or just did not implement automated source tracking correctly. There is no reason for employers to offer options like this, because they do not add value or insight to measuring source effectiveness. Companies that are struggling to meaningfully identify the sources within their ATSs can seek out third-party expertise. SilkRoad offers such consulting services to organizations, helping them to determine the best ways to categorize and organize their data, so that it can be used to calculate the return on investment for dollar spent. SilkRoad is committed to assisting companies in building highperformance applicant tracking systems.
Copyright 2013, SilkRoad. All Rights Reserved. All trademarks are the property of their respective owners
About SilkRoad
SilkRoad is a leading global provider of cloud-based social talent management software. Why simply manage talent when you can unleash it? The award-winning SilkRoad Life Suite is an integrated set of talent management products that power businesses with the latest Internet and social media innovations: OpenHire for recruiting RedCarpet for onboarding and life events HeartBeat for HRMS GreenLight for learning management
WingSpan for performance management Point for social collaboration and content
The Life Suite is ideally suited for businesses of every size because of its unique and open start anywhere architecture: you can implement the complete suite or begin with one product and add functionality as you need it. Either way, its the fastest path to develop more productive and empowered employees who can rapidly boost business performance.