How To Get More Bang For Your HR Tech Buck

Every year in the US alone employers spend $72 billion — that’s billion, with a B — on recruiting services, staff and technology. For some perspective: $70 billion will buy every franchise in the NFL, MLB, NHL and NBA with some extra cash leftover to buy 25 personal jets. The latter purchase would probably yield a better return on investment than most employers are getting out of their recruitment spend — so why do companies continue to spend so much?

The short answer is that the stakes have never been higher for recruiters vying for talent and 30 percent of recruiters admit they still “don’t know where to start” when it comes to recruiting. Technology helps, but it has to be utilized properly. The investment is just the first step.

recent survey suggests that 57 percent of companies plan to make a major HR technology purchase in the next 18 months, and recruiting is the most commonly cited focus for the big-ticket purchase. Within the talent acquisition category, most HR leaders say that the ability to analyze and interpret data is their biggest decision driver for recruitment technology investments. Gone are the days of just-in-time hiring, where time-to-fill was the only metric that really mattered to front line recruiters.

Solving the Data Dilemma

Since institutional knowledge shortage seems endemic, enterprise talent technologies must now capture terrabytes of available candidate data. Equally important, they must also make those numbers add up to a compelling business case with functionalities that are inherently accessible to the average recruiting end user.

That’s why advances like federated search and dynamic profiles, which aggregate disparate databases into one single system while capturing and standardizing candidate information and documentation, are critical first steps in solving the data dilemma. By having all potential sources of hire in a single destination, employers also, in effect, have a single destination for collecting actionable data and analyzing the numbers to make better talent decisions.

Tapping the Talent Source Through the Data

The ability to simultaneously compare job posting performance and efficacy across all sources is imperative for maximizing and optimizing recruitment spend. For example, one of the nation’s largest private hospitals recently consolidated its recruitment advertising platforms and databases — integrating these sources and associated workflows directly into an applicant tracking system. For the first time, the hospital was no longer reliant on candidate and recruiter self-reporting to track how well individual sources of hire were performing. Now it could track individual applicants, candidates and recruiter activity to finally know where its applicants — and hires — were actually coming from.

This healthcare employer, which had historically spent heavily on premium recruitment advertising sources like paid job general and niche job boards, was able to see that while only 17 percent of its overall active external job postings were live on the online job board Indeed, the aggregator actually accounted for a whopping 80 percent of overall job description views and, ultimately, 70 percent of incoming, qualified applicants. This information enabled the organization to change its focus from paid postings to driving search engine traffic with organic SEO. This shift lead to another 39 percent increase in job views while achieving significant cost savings throughout the organization.

Invest in Systems of Integration

Recruitment advertising is just one example of why systems integration is an important first step to unlocking the power inherent in big data — and the decisions it enables. Since the information collected by resume and profile parsing becomes standardized, so too does the associated data, allowing visibility into what’s working — and what’s not — in talent acquisition across the enterprise.

The integration and consolidations of systems not only makes it easier to get a better view of the return on recruiting resource investments, but also optimize that resource allocation for future tools, technologies and talent. With $72 billion dollars a year on the line, you don’t need to do the math to see how it all adds up when it comes to finding, attracting and engaging top talent.

Originally Posted on The Human Capitalist Blog

Views: 101

Tags: Corporate Recruiting

Comment by Tim Spagnola on January 7, 2014 at 9:54am
Great read Matt and extremely detailed. This is not only a good read from a recruiting standpoint, but also worth sharing with organizational decision makers who are writing these checks. Throwing money around alone will not solve one's staffing needs.
Comment by Tim Spagnola on January 8, 2014 at 8:51am

by the way......

I should add that some decision makers at my own organization are scratching their heads after writing the check for WorkDay, While those of us using the platform daily recognize the efficiency it offers, the benefit of a self managed HRIS still has a way to go before gaining wide acceptance. Perhaps when we add the talent module for the recruiting team we can begin to help in this area and show more of our colleagues why large HR purchases are a smart investment.

Comment by Keith D. Halperin on January 8, 2014 at 1:52pm

Thanks, Matt. This is quite informative. If I might suggest a radical solution to those anticipating a substantial HR or Recruiting purchase:

Ask those of us actually doing the work what WE need to make our jobs better, easier, faster, less tedious, etc.  and before you sign the check: make sure WE'VE had a chance to try it out. That way, there's less of a chance we'll be stuck with that expensive, largely unusable, highly complicated, user unfriendly piece of crap we had foisted on us last time...

Cheers,

Keith "It's Always' Something'" Halperin

Comment by Rachel on January 22, 2014 at 1:28pm

For systems integration, cloud based products continue to make the investment in HR technology products less expensive and more accessible to smaller organization, while still helping people get their job done. As recently as five years ago, most HR technology was not affordable for small and medium enterprises. And now, many HR technology products offer starter plans, the ability to cancel at any time - and integration with other complementary HR software products. 

I agree with Keith - for HR Tech companies it's important to focus on the user experience their products - to create and build software that will actually get used and make life easier for HR and Recruitment teams, and stay away from creating ones loaded with bells and whistles that just make the experience painful. 

Comment by Matt Charney on January 22, 2014 at 1:51pm

Rachel - think that you're spot on, and this trend of a level playing field offers further proof of not only how powerful SaaS can be as a tool, but also as a way to hold vendors accountable for continuous improvement, innovation and ROI. Appreciate your comment!

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