Human Resource Analytics in Hiring
Data analysis helps companies in various ways, when trying to understand the consumer behavior and decision making processes. It’s becoming vital, not just for management or product teams, but especially for HR departments, to analyze the data they have in order to make informed decisions regarding people management and hiring.
HR Analytics is not just about making informed decisions in the present. It is especially useful when it comes to forecasting. It provides a way to implement accountability and performance management within the HR departments.
71% of companies see people analytics as a high priority. Only 9% believe they have a strong idea of which talent dimension drives performance. (Deloitte’s 2017 Human Capital Trends report) Why is people analytics a high priority you might wonder? Well, when used it can provide great benefits: A study by Bersin by Deloitte states that companies using HR analytics to support business decisions see an 82% higher three-year average profit than their counterparts.
There are different components that make up HR analytics, including: hiring analytics, feedback analytics of the existing workforce and optimization analytics which focuses on predictions and forecasting. According to LinkedIn Global Talent Trends 2020, the current people analytics used most are measuring employee performance and strategic workforce planning. However, applying data to assess skill gaps, evaluate recruiting channels, and analyzing talent supply-demand are on the rise.
This post will focus on the hiring.
When data is applied to hiring, HR analytics can help gain meaningful insights in order to:
- Save time
- Save resources
- Hire the right skills
Any major organizational changes expected that may affect hiring?
To start of, it’s important that recruiters get to talk with management and participate in meetings concerning changes or the future of the company. Clear communication and alignment of strategic decisions will help recruiters focus their energy and prioritize their tasks. If you have a large HR department, then try to set standardized goals for teams and review them together in relation to the planning and forecasts.
Look into the recruitment funnel effectiveness:
Are quality candidates applying to your vacancy? Candidates go through a journey, also known the recruitment funnel. Try to find out which part of the recruitment funnel takes the longest and optimize your time.
Tracking your data and analytics
It is important to think about how you will track the data you have and ideally use software or tools that can instantly analyze key factors. For this applicant tracking system or other HR systems used for reporting hiring can be helpful. Ideally information is kept seamless, and is not spread across too many platforms/databases.
HR Analytics in hiring you should track:
- Average time to hire: Ideally you compare this statistic to various departments, roles and even between hiring managers. Use benchmarks to compare the results with other companies. Workable has a great tool for hiring benchmarks.
- Reduce time to hire: On average, it takes around 27 business days to make a new hire. However, the best candidates are off the market within 10 days! Nowadays, companies need to be faster in their feedback processes and hire quickly. When you track the time to hire (the time in which a candidate expresses interest to the time they accept an offer), you can look at the pain points in your recruitment funnel.
- Sourcing channel effectiveness: Find out which channel is acquiring the best candidates. High quality candidates are often not applying to your job posting. Instead recruiting services can contact passive candidates. Check if these services provide feedback on why talent declines an offer? Use unique links for your channels so you know which ones perform best for the same role, for example Google analytics and UTM parameters (check out bitly.com or URM.io). Visualize the metrics with google sheets, tableau, excel or other tools.
- Visitor to applicant conversion rate: Check out benchmarks here.
- Quality of hire: Although the definition of quality varies according to job role and company, analyzing this can really help find patterns and improve future hiring by evaluating methods to predict a candidate’s job performance. Quality of hire is difficult to assess, as it is measurable several months after hiring a candidate. A mix of employee performance, retention and engagement can be effective to discover the quality of hire.
- Career website analytics: Where do people who visit your website come from? Where do they click other than career page? What device do they use? Are you using SEO? Is your website mobile & user-friendly? Using heatmaps, usability tests and basic website analytics, such as google analytics or semrush, can help you identify these points.
Employer Branding Metrics
- Online Ratings & Reviews: Check your company’s online presence on platforms like. glassdoor, kununu, indeed, and more. A potential candidate will research this too, so you should be ready to present your brand well on such platforms. You can look at: company ratings and current & past employee reviews.
- Utilize feedback forms, to gather insights from your employees and provide a communication tool for sharing ideas on improvement. Tools such as typeform can be used for surveys.
- Employee Retention Rate: This will inform you about the overall trend in your company regarding happiness and loyalty. If employees are always coming and going, this could mark room for improvement.
- Employee Referral Rate: This is a great indicator for employer branding, as word-of-mouth can be a powerful tool. How many of the new applicants were from current employees?