The Need for Speed in Recruiting
Is your recruiting process fast enough?
If you were to Google "time-to-hire recruiting benchmark" you would get a wall of averages ranging from relatively short (30 days for customer service) to quite long (70+ days for data scientists).
It's easy to take the time-to-hire or time-to-fill metric at face value and start measuring yourself against it. Most recruiting organizations do.
While measuring one's recruiting process is critical, in this article I'm going to make the argument that time-to-hire isn't a good enough metric for process optimization.
Instead, I'm going to make the case for using a set of metrics that more directly reflect the health and efficiency of your recruiting process.
But first, let's discuss why the velocity of your recruiting process is so important.
Why recruiting speed matters
There are two main reasons why speed matters in recruiting:
- Time is money. The longer a role remains open, the more money you're leaving on the table.
- Candidate experience. The slower your process moves, the less likely you are to close your top choice candidate.
These aren't controversial ideas but their significance becomes clearer when you put some numbers to them.
For example, take the cost of an unfilled position. We often think about the costs of hiring such as Linkedin subscriptions, job postings, SaaS licenses, recruiting staff, agency recruiters, etc.
We don't as often think about the opportunity cost of unfilled headcount or the costs of a slow process vs. a fast process. I talk about calculating opportunity cost of unfilled jobs in a different post but for now let's assume you calculate the cost as $500 a day. The effect of speed is obvious to see:
Fast process: 20 days x $500 = $10,000
Slow process: 45 days x $500 = $22,500
That's an additional $12,500 cost for a slow process!
Whether you calculate opportunity cost simply or with a sophisticated model, the time variable is what drives the expense.
Not only does a slow process cost you money, it also costs you candidates.
In our experience, one of the biggest factors in whether a client is able to close a candidate or not is the speed of their process. All other things being equal such as offer, benefits, employer brand, etc., how quickly and efficiently a process moves is a crucial factor in whether a candidate accepts an offer at one company vs. another.
The reason is two fold. First, a fast and efficient process tells candidates that you care about hiring and signals how your workplace will operate.
Second, the window of time to interest, engage, and close top talent is very small. Some estimate it to be just 10 days. We think it's a little more nuanced than this but we can tell you from experience, the best people aren't going to stick around in a process that drags along.
And when you lose good candidates because your recruiting process is slow, you compound the cost problem. It's a vicious cycle and the only way to break it is to first measure what's going wrong.
Most recruiting orgs that I talk to think of their work in terms of pipelines and funnels. This is a natural way to talk about recruiting because in effect a recruiter is both building a pipeline of candidates and managing them through a funnel.
The problem with looking at it this way is we start to think of the whole affair as a numbers game rather than a human experience. When we think of recruiting as pipelines and funnels we naturally start talking about things like interview-to-offer conversions and time-to-fill averages.
These metrics are no doubt one important way to measure your recruiting process. But they all miss the point.
No matter how much tech or process we throw at the problem, recruiting still has humans on either side of the equation. You can't forget that.
For this reason, we think recruiting organizations should focus on a set of metrics that better measure actual, day-to-day speed and health of your process.
Here are the metrics we think are most important when it comes to measuring recruiting speed and why.
- Missed SLA % by pipeline stage: If there is one new metric you introduce into your recruiting process, it should be the percent of time you meet or miss your SLAs. This is important for three reasons. First, it will force you to set SLAs for each step of your process. Second, by measuring how often you're hitting those SLAs you'll naturally start to identify bottlenecks. Third, SLAs are how the humans involved experience the recruiting process, e.g.: "Did the recruiter follow-up when they said they would?"
- Application-to-review time: For inbound candidates, how long did it take you to review their application and respond? There is a HUGE difference to putting in an application and getting a phone call later that day vs. not hearing anything for a week or two. Massive companies and name brands get away with long delays in this metric (although, they'd be wise not to) but if you're a startup or small company, being slow sends a bad first impression. Even if candidates are understanding, long lead times in this metric is a risk to getting candidates into your pipeline. Remember, until you've reviewed an application and decided not to move forward you should treat every single one as your next potential hire.
- Interview-to-offer time: How long does it take you to make a hiring decision and communicate an offer after interviewing a candidate? This is another part of the hiring process where speed is critical. As a rule of thumb, if it takes you more than 5 business days to make an offer after interviewing a candidate, you're odds of closing start to drop. If the candidate is interviewing elsewhere, your odds drop even faster.
- Average days per stage: Similar to measuring the percent of time you're meeting SLAs, this metric gives you a view of your entire pipeline and which steps you're losing time on. When you look at your recruiting process this way it's easy to identify both areas for optimization and where edge cases are impacting your average.
- Qualitative candidate experience feedback: Another important way to measure the speed and efficiency of your recruiting process is by candidate perception. If you're not asking every candidate who goes through your process to anonymously provide feedback than you're missing a treasure trove of insight. Speed as measured in time is critical, but so is how candidates are experiencing the process. And don't short-change yourself by relying on a metric like NPS here. Instead, ask 2-3 thoughtful questions and give the candidate an anonymous way to respond. You'll learn so much more.
Common speed bumps
I won't spend a ton of time here but it might be helpful if I call attention to a few areas where I see recruiting organizations routinely lose days and sometimes weeks in their process.
Slow decision making
As with any process where humans need to form consensus, making a hiring decision can quickly become mired in drawn out, circular debate. This is exacerbated when there isn't a structured interview process, clear evaluation criteria, or a decision making framework. Without these it will take you longer to make decisions and odds are you will make worse decisions.
No owner / wrong owner
Another common speed bump is not having an owner for a step in the process or having the wrong owner. If you aren't measuring each step of your process for speed, it's easy to miss this. Many times when we instrument a recruiting process and start measuring how things are working, you'll find the slowest parts are often because the wrong person is owning it.
If it's unclear who does what, or even what needs to be done in a given situation, it's much more likely that you lose time. It also means the next speed bump is likely to occur...
Dropping the ball
No one really likes to talk about this but when it comes to hiring, companies drop the ball all the time. The ways and whys differ but I've seen very few recruiting organizations that didn't have edge cases where time is lost. Again, this is the importance of setting SLAs and investigating when they aren't met -- that's how you find the edge cases.
Best practices to go faster
If you want to increase the velocity of your recruiting process than you need to do two key things:
- Eliminate speed bumps
The first step in building a faster recruiting process is making sure you're measuring what matters. While conversions get a lot of attention, I'd argue that process speed and outcome are far more important. Conversions are obviously an input into that, especially if you're doing things at scale and using automation, but what does conversion matter if it takes too long and/or doesn't have a good outcome.
The second best practice is built off the first. Once you are measuring what matters than you need to foster a mindset of continuous improvement. The problem with process is that people quickly accept it as the way things are done and stop thinking about how to improve it. This inertia is deadly over time. To avoid it, regularly review your metrics and create initiatives to directly improve them.
If you do just these two things you will begin to develop a competitive advantage in recruiting talent.
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