HR Benchmarking: 3 Ways to Get More Out of Recruitment Metrics
Taking a data-driven approach to HR and, more specifically, recruiting, starts with one thing: data. As simple as that sounds, too many companies are still haphazardly making decisions based on “what’s worked in the past” or “what feels right” rather than collecting and using the wealth of information at hand.
Not only can a more scientific approach actually guide and validate the decisions you make, it can also be used to drive quantifiable improvements when leveraged strategically. But it doesn’t stop there. Today’s most strategic HR departments and recruiting organizations are taking their performance a step further with benchmark data.
Performance benchmarking can be put into action in a number of different ways, and in this post we’ll highlight the three most useful.
1. Understanding Your Performance Internally
We often overlook the fact that data can be used to compare different areas of performance internally. By creating a set of standardized recruiting metrics and key performance indicators, a talent acquisition leader may look at—and benchmark—her team’s performance in a more objective way, one that highlights inefficiencies and points out what’s working.
The idea of comparing internal performance may sound like a ranking system to some, but that shouldn’t be how it’s perceived. When, for instance, dozens of recruiters with virtually the same job are all using similar but slightly different methods to identify, engage, and attract candidates, it makes sense to know who’s doing well and why.
It should be pointed out that one of the keys here is metrics standardization. If everyone is held to the same standards behind which variables make up a particular HR or recruiting metric, that’s not only more clear, but it also provides something to strive for and strengthens the data set over the long-term.
2. Comparing Your Performance Across Industry Averages
Benchmark research is a vital tool for understanding the performance of your entire recruiting organization. Similar to the way you might benchmark your internal performance, recruiting benchmarks for your industry can provide a comparative lens to look through. However, when benchmarking your company performance, there’s typically a different set of stakeholders interested in the results.
Industry benchmarks are almost always created based on survey results—either by an analyst firm or another company that sets out to research a specific topic. If you’ve been in the recruiting industry for a while, you’ve probably seen lots of surveys come and go over the years. One we suggest looking at and participating in is the 2015 CandEs research conducted by The Talent Board.
As is the case with internal benchmarking, the way recruiting metrics are calculated certainly plays a role in the effectiveness of the data. While you may look at average time-to-hire or data around sourcing channel effectiveness, the variables used to calculate them by you versus different companies can impact where you stand (so make sure to take note of that).
3. Building a Business Case for An Investment
Investments in technology like enterprise software or other recruiting tools are generally costly, so it’s often necessary to build a business case. However, this is an exercise with which many companies—especially ones that aren’t data-driven—tend to struggle. Recruiting and broader HR benchmark data can be very helpful here, as it can be used to demonstrate a before and after picture.
To actually build a business case with benchmark data, you need to be able to cross-analyze different variables, which shows the impact one variable has on another.
For instance, you might look at the impact of adopting job alerts on the cost-per-applicant metric. By comparing your current cost-per-applicant performance without job alerts to the industry average cost-per-applicant performance of companies with job alerts, you can then project the ROI. This can be complicated, so we’ll discuss this more in depth in the future.
How To Get Started With Benchmark Data
As we discussed in the past, there are many different companies that provide benchmark data around talent acquisition and recruiting. By bookmarking these companies’ sites or joining their mailing lists, you can stay up to date on the latest research in the industry.
You might also be interested in taking a look at a research study we recently launched with Beamery. This is a small study on analytics and data maturity, and the survey only takes two to three minutes. A few hundred recruiting professionals have already participated, and everyone who takes the time to answer the questions will get an eBook with the results in the near future.