In today’s blog post, I’m going to share the three key recruitment metrics for small businesses that you need to track in your organization.
My name is Sadaf Shaikh and I’ve worked closely with CEOs of small businesses. I understand the pressure of being on a tight budget and needing to maximize resources. Tracking these three key metrics will help you pinpoint how well you’re attracting top talent into your company and how to get the biggest bang for your buck. Now, let’s get to it.
Key Recruitment Metric for Small Businesses #1 – Track candidate source
Metric #1 is to track where you’re getting your candidates from. Some common candidate sources are:
- Specific job boards
- Social media
- Specific schools or programs
You can then take this a step further and track which source you’re getting your new employees from. This makes it easy to duplicate your efforts when it’s time to hire again, assuming that the new hire is a success. The best way to track the source of your candidates and employees is by using an applicant tracking system. This is an automated tool that helps you post your job on job boards and manages the whole recruitment workflow for you. I have a blog post on the Best applicant tracking systems for small businesses. Check that out to learn which applicant tracking system is best for your business.
The key to doing recruitment in a small company is to make the whole hiring process as easy as possible. When you track where your candidates and new employees are coming from, you can double down your efforts on that particular source making all future hiring that much easier.
Key Recruitment Metric for Small Businesses #2 – Track quality of hires
Metric #2 is to track the quality of your hires. Unfortunately, most companies don’t track this information even when they have large HR departments. For a small business, this metric helps you understand how effective your recruitment practices truly are. Look, I get it, you spend hours on posting the job, interview candidates, and deciding on the top person. You want to ensure that the person you’re picking is really the right person.
Tell me, in the comments, have you ever hired someone, spent 2-3 months getting them up to speed only to find out they’re not all that great. But by then you’ve invested so much time, you can’t bear the thought of going back to the drawing board to find another person. If you’re saying yes right now, you’re not the only one. This happens too often and in a small business, you can’t afford mishaps like that.
You have to know how well your new hires are performing 1 month, 2 months, 3 months, 6 months and 1 year after they’re hired. Plus coupled with tracking the source of your candidates, you can focus your recruitment efforts on that source because it’s been proven to pay off in the past.
Recruitment Metric #3 – Track cost of recruiting
The third key Recruitment Metric for small businesses is tracking the cost of your hires. This is a key metric that is relatively easy to track. Mostly.
The cost of recruitment takes into consideration direct costs like money spent on posting jobs on specialty job boards or on recruitment agencies. Indirect costs are the cost of time and resources from within your company. How many hours of time are you and your team spending on hiring employees? All this also goes on the recruitment tracker.
The thing about tracking costs is that the ultimate goal is to use this metric in conjunction with the other two key metrics. Knowing how much you’re spending with the quality of hires and the source of the hires will give you a nice, full picture of what recruitment looks like at your company. On top of that, tracking costs will allow you to see where money is flying out the door and how to possibly reduce the costs of hires.
For example, if you’re spending on specialty job boards, but a bulk of your high performing new employees are coming from employee referrals, then it’s a pretty good indicator that you could save that money because it’s not giving you a good return on investment.
If a bulk of your recruitment costs are coming from recruitment agencies for whatever reason and you’re getting good employees from this source, then go ahead and negotiate a better rate with the agencies. Insider tip, if you give agencies enough business, they’re more than happy to discuss rates with you, especially if you’re happy with their work and you’re a good client to work with.
Tracking these recruitment metrics will allow you to see a full picture of your process and help you make better hiring decisions.
Recruitment metrics notwithstanding, the success of your new hires is directly tied to how well you screen them and your selection process, namely your interview questions. The number one reason new hires don’t work out is because they don’t fit into your culture. That’s why I created the Top 10 Interview Questions to Assess Culture Fit. It’s a list of questions you can ask to assess how well the candidate in front of you will fit in your organization and with your current team.
Now, I want to hear from you. Tell me in the comments, which recruitment metric you’re going to track first and what was your biggest take away from this video.
Don’t forget to check out my blog post on the best applicant tracking systems for small business – it’ll help you track some of the metrics. If you prefer video, check it out here.