8. DATA-DRIVEN STRATEGY IN RECRUITING
The Beginning of Data-Driven Recruiting
In the 1990s, internet hit the recruitment head-on and
changed the way we recruit for the better. It was the time when online
job portals came into existence, which gave candidates an easy way to apply to
companies and companies could get access to a large pool of candidates. There
hasn’t been much change ever since. More than 23 years later (indeed got
started in 1994!) a lot has changed and a whole lot has not. The emergence of
newer mediums of communications has changed the way we recruit and, in its
wake, generated a tremendous amount of data.
An immense amount of data is present and is generated every day around recruitment, be it
during the application process, screening, communication, or review.
Organizations need to implement data-driven recruitment strategies as they can
always be tested, measured, and improved.
Recruiterflow
Inc., (2024)
What is Data-Driven
Recruiting?
Data-driven recruitment is a data-driven approach to hiring
uses technologies, techniques, and data to analyze a large talent pool and
identify candidates with the right skills, experience, and mindset to help the
organization achieve its goals. Recruiters will take a large talent pool,
analyze it using a variety of technologies, and narrow it down until only the
best candidate remains. (McConnell, 2021)
This
method allows for a more hands-on and a competent recruitment strategy, helping
to identify the best candidates, optimize job descriptions, and align
recruitment efforts of the organization.
How to Implement
Data-Driven Recruiting?
Ways to practice this strategy in the organization is discussed below and cited from Recruiterflow Inc., (2024)
Log Everything
All the
actions including communication, reviews, touchpoints, and changes should be recorded
so that the system has a complete view of the recruitment process. Strong
data logging abilities can rationalize the process of recording and sustaining
an all-inclusive view of the recruitment process.
Automate Data Capture
Data such
as email, calendar invites, calls, SMS, and Internal communications should be
captured automatically with an ELT (Extract, load, transform) data integration
process. An organization can save 20% of their time which is generally spent on
logging data into the system if they log it automatically.
Automate Communication
When it
comes to recruitment, organizations can automate all the outbound emails sent
to candidates while sourcing. The system can personalize the message and will
be on autopilot based on rules unless some candidate replies. This not only
saves recruiters time but immensely helps your sourcing efforts. If end-to-end
automation is something that you want to implement consider using the recruiting automation software.
Scorecards
All the
stages in the screening process should have a scorecard corresponding to them.
Candidates should be marked objectively against various relevant skills and
binary decisions (yes/no) should be made for the stage. Detailed notes for the
stage should be maintained to dig deeper. After a certain stage organizations
can also standardize ratings given by various interviewers to remove
interviewer bias. Skills should also be rated on an objective 5/10 point scale.
Measure Hiring Speed
Focus
on relevant metrics and data sources because it is essential to know what you
are measuring. It helps you align your recruiting efforts. You get to scrutinize
a range of metrics to enhance the performance in all facets of recruiting.
Source Quality
Source
quality should be measured along two parameters, the number of candidates and
the quality of candidates. Calculating source quality can be complicated
without using a system (or at least Excel) but it helps you increase your
efficiency and decrease cost per hire. You need to define the contribution of
each stage in the recruitment funnel to candidate quality based on your
historical data.
Follow a Structured Interview Process
In order
for the data to give you the right kind of insights, you need to generate the
right kind of data first and a structured interview process is the best way to
get there. You can tie the recruitment data to the actual performance
data of the hired candidates and see what are characteristics high performers
share in their recruitment process. A structured interview process is your
first step towards this goal.
Benefits of Data-Driven
Recruitment
· Speeds
up the hiring process
· Reduce
hiring costs
· Restraining
hiring bias and making more objective hiring decisions
· Enhances
candidate experience
· Being proactive
instead of reactive
· Enhancing
the quality of hire
· Setting
up the recruiting team for success
 |
| Siocon, (n.d.) Data-Driven Recruitment |
Applying Best
Practices
· Select appropriate
metrics and identify data sources
· Build a
recruitment dashboard
· Regulate
actions to take
· Contemplate
data limitations
· Compare
the before and after states and repeat
Types of Data in
Data-Driven Recruiting
Data-driven recruitment exploits
various types of data, including candidate demographics, skills and
qualifications, engagement metrics, sourcing channel effectiveness,
time-to-hire, cost-per-hire, and employee retention rates.
Types of Recruiting
Metrics
 |
| Vulpen, (n.d.) Frequently used Recruiting Metrics |
The tools you need to
implement a fully data-driven approach to hiring will likely be according to the
size of your company and your annual hiring needs.
Common Recruitment Key
Performance Indicators(KPIs)
Speed-based recruitment metrics
Time to hire, time to accept, time to start, time to approve and time for each stage.
Quality-based recruitment metrics
From submission to acceptance rate, source of hire, applications per job, candidates per hire and employee retention rates.
Cost-based
recruitment metrics
Cost per
hire, applications per channel, talent pool growth and advertisement performance.
Application Tracking Systems in 2024
The technologies like an Applicant
Tracking System (ATS), HRIS or performance management platforms, to name a few,
all contribute in some way to this massive collection and analysis of
recruitment data.
According to Haan, (2024), An Application Tracking System can improve the
selection process by streamlining and automating many of the tasks involved in
recruitment. For example, an ATS can automatically generate an email to
applicants when they submit their résumés, as well as make notes on each
candidate’s profile so recruiters can easily track their progress.
Below are the best ATS systems
that could be used in 2024:
Haan, (2024)
- Freshteam by Freshworks: Best overall
- JazzHR: Best for startups
- BreezyHR: Best free
applicant tracking system
- Rippling: Best ATS plus payroll
- Greenhouse: Best for
midsized businesses
- Zoho Recruit: Best for its free trial
- BambooHR: Best for large employers
- Workable: Best
for computer software companies
- Bullhorn: Best for recruitment
agencies
- Recruit CRM: Best ATS plus CRM
- Recruitee: Best jobs widget
o ATS systems allow for real-time collaboration relating
to candidates’ applications and information, enabling parties to share updates
and eradicate bias in hiring.
o
Allows to identify potential candidates faster.
Conducting extensive searches, shortlisting candidates are done quickly than
reviewing each resume manually.
o
The application tracking system stores all the
necessary candidate data and automatically gives them a score relevant to the
position applied to.
Challenges of
Data-Driven Recruiting
Data security and privacy
Data security is crucial in hiring using this strategy. The compliance with the data protection regulations like GDPR is vital to safeguard private information, thereby sustaining trust and transparency with candidates.
Integration of tools and systems
Utilizing the recruiting tools and systems can be a challenge due to their complexity and potential disruptions that may occur. Therefore, choosing compatible tools that will enhance the efficiency is very vital. Always ensure a continuous flow of data between diverse platforms.
Requires constant training and monitoring
It’s vital to frequently monitor and alter algorithms
to avoid any form of bias in the recruitment procedure, certifying that
decisions are based on unbiased data and not influenced by underlying biases
present in the data collection process.
Cost and resource constraints
Implementing a data-driven strategy can be
resource-intensive, especially for smaller organizations. Therefore,
it is crucial to cautiously plan and assign resources, balancing the probable reimbursements
of data analytics with the associated costs, and exploring scalable solutions
that can grow with your organization.
Ethical considerations
Make sure that the data is collected and used ethically
is paramount. This comprises being transparent about how data is gathered
and utilized, and ensuring that ethical standards are sustained in all data supervision
processes, thereby building trust with applicants and stakeholders.
Challenges in Scalability
When organizations grow, the challenges of scaling
data-driven recruitment strategies also grow. Diverse roles and
markets may impose mixed approaches, adding complexity to the task of selecting
and implementing the most effective data-driven strategies.
Recruit CRM. (2024)
Conclusion
Executing data-driven
recruitment requires more than just gathering some data. You need an approach that
will change and start working in a new way to fully obtain the benefits of
data-driven recruiting. An excellent place to start is to examination what data
you’re already collecting through your HR technology and think of how this data
can help you improve your recruitment process. If your goal is to reduce costs, focus more on cost-based
recruitment metrics and optimize your hiring strategy around cultivating
efficiencies. If you want to advance the overall quality of your hires, then
take a profound dive into what your metrics are saying about the hiring pipeline, employee
engagement, and retention.
References
Haan. K., (2024) 11 Best Applicant Tracking Systems of 2024 [Online] Available at: https://www.forbes.com/advisor/business/best-applicant-tracking-systems/ [Accessed on 02rd April 2024].
McConnell. B., (2021) How to use data-driven recruitment for hiring success [blog]. Available at: https://recruitee.com/articles/data-driven-recruitment [Accessed on 04th April 2024].
Recruiterflow Inc. (2024) Data-Driven Recruiting [blog]. Available at: https://recruiterflow.com/blog/data-driven-recruiting/ [Accessed on 03rd April 2024].
Recruit CRM. (2024) Data-driven recruitment: The complete guide for 2024 [+5 best practices] [blog]. Available at: https://recruitcrm.io/blogs/data-driven-recruitment/ [Accessed on 03rd April 2024].
Siocon, G., (no date) Data-Driven Recruitment [image]. https://www.aihr.com/wp- Available at: content/uploads/data-driven-recruitment.png [Accessed on 05th April 2024].
Vulpen. E.V., (no date) Most Frequently used Recruiting Metrics [image]. Available at: https://www.aihr.com/wp-content/uploads/Recruiting-Metrics-Updated.png [Accessed on 05th April 2024].
Insightful article, Judith. It'd say there's more pros than cons with data-driven recruitment. Though through correct implementation like you've mentioned, it can be very relevant in an organization. Low quality data or any errors during data loading can lead room to errors especially if this is outsourced to third party organizations, or if it is susceptible to any human error.
ReplyDeleteYes, Anjalika. There will be definitely errors if low quality date is input into the system but as I have explained, 'Strong data logging abilities can rationalize the process of recording and sustaining an all-inclusive view of the recruitment process'.
DeleteThis susceptibility to human error could be minimized.
This is a nice article .. yes the Reduction of hiring costs is one of the best ways to implement the future of the organization
ReplyDeleteThank you for sharing your valuable thought on my article, Amesha. Yes, reducing hiring costs is essential as the whole world is facing an ongoing inflation.
DeleteInsightful article. By adopting a holistic and strategic approach to data-driven recruitment, organizations can leverage data analytics to make more informed hiring decisions, improve candidate quality, reduce time-to-fill, and enhance overall recruitment effectiveness.
ReplyDeleteDefinitely Arundathi! Organizations can leverage data analytics to make more informed hiring decisions, improve candidate quality, reduce time-to-fill, and enhance overall recruitment effectiveness by implementing this strategy. Thank you for sharing your valuable comment on my article.
Deletet's evident that your article is the product of thorough research and meticulous attention to detail, with a wealth of well-cited sources that underscore the credibility of your arguments. Yes Relying solely on data and technology may overlook the human element of recruitment, such as soft skills, cultural fit, and intuition. This can result in a lack of empathy and personalization in the candidate experience, leading to disengagement or dissatisfaction among candidates.
ReplyDeleteYour valuable feedback is much appreciated, Wasula! Absolutely, relying solely on data and technology may overlook the human element recruitment. I completely agree with the facts that you have mentioned regarding the bias this might cause.
DeleteVery Insightful post Judith! Conventional resume screening, which prioritised education and experience, occasionally missed exceptional candidates with non-conventional backgrounds.
ReplyDeletefor example, Netflix has adapted a skills-based evaluation procedure. There the candidates undergo online coding challenges that assess their real coding skills. Netflix was able to find and employ exceptional individuals with the abilities they needed to succeed despite not having a traditional history in software engineering, because to this strategy.
Definitely Dishani! Agree with you. Thank you for sharing your thoughts on my article. Yes, the Netflix's skilled based evaluation procedure you mentioned is a great example. Thank you.
DeleteData-driven recruitment offers numerous benefits but also comes with drawbacks. Firstly, it can perpetuate bias if the algorithms are based on historical data that reflects existing biases (Dastin, 2018). Secondly, over-reliance on data may overlook valuable intangible qualities that are crucial for job performance (Erevelles et al., 2018). Lastly, it can lead to candidate disengagement if the process feels impersonal and lacks human interaction (Lyons, 2019)
ReplyDeleteThank you for the critical analysis on the article, Chamara!
DeleteI will disagree with you Chamara. There can be drawbacks when using this data-driven strategy as you have mentioned in your comment. However, I have mentioned about the challenges and how to overcome them and it is explained in the article.
*Please refer to The Challenges of Data-Driven Recruiting subtopic for further clarification.
Lack of human interaction is not mentioned anywhere in the article because from the beginning to the end of the recruiting the human negotiations and interaction is required even to enter the data accurately into the systems humans are involved. The use of recruiting metrics and recruiting data doesn't mention the humans are not involved.
Only the automation to send emails and updating applicants regularly and using automation to capture some data; these two procedures lack a bit of human interaction because it's done accurate enough using automation systems.
Nicely explained your article about data-driven recruiting strategies - it's informative, practical, and offers valuable insights for improving hiring processes!
ReplyDeleteYour valuable feedback is much appreciated. Thank you.
DeleteData-driven recruitment is complicated as seen by the emphasis on several measures such as cost-based recruiting metrics for cost reduction or analytics linked to hiring pipeline, employee engagement, and retention for increasing quality. In order to maximize the benefits of data-driven initiatives, this approach recognizes that there is no one-size-fits-all solution and encourages companies to assess their unique needs and goals. All things considered, it offers a thorough foundation for businesses wishing to improve their hiring procedures using data-driven insights.
ReplyDeleteThank you for sharing your insightful comment, Neashara. It is a complicated measure that requires HR professionals to handle the process. The HR teams need to implement this strategy well with the necessary training about strategic data-driven recruiting. Thank you for sharing your valuable thoughts!
DeleteYou've chosen a unique topic, and I love how you've pointed it out. Topics: According to( Đurković, J.V., Nikolić, I., and Siljanoska, S., 2020), an increasing number of studies have empirically looked at how hiring strategies affect organisational performance metrics, frequently in tandem with other HR practices.
ReplyDeleteMuch appreciated for sharing your insights about this article, Dilshad. Yes, that is why implementing well thought out and planned hiring practices are an essential part of recruiting.
DeleteInsightful Article Judith. You have pointed out the fact of importance and have wonderfully justified your topic. using data and analytics to make decisions throughout the recruitment process by implementing strategies like KPIs, metrics , analysis, assessment tools organizations can leverage data to make more informed decisions, optimize their recruitment processes, and ultimately attract and hire top talent more effectively. A very useful Article Wonderfully written.
ReplyDeleteYour valuable feedback is much appreciated, Shalindri. Yes, the use of data and analytics to make decisions throughout the recruitment process by implementing strategies like KPIs, metrics, and assessment tools organizations can leverage data to make more accurate decisions and thereafter optimize their recruitment efforts. This in turn, leads to attract and hire top talent effectively.
DeleteLet's dive into data-driven recruiting, tracing its journey from the 1990s to today's essential role in hiring. We'll explore practical methods like automating communication and tracking actions, along with benefits like faster hiring. Challenges such as data security and ethics will also be addressed, emphasizing the need for a comprehensive approach to talent acquisition.
ReplyDeleteThe valuable feedback given on my article is appreciated, Ruwan. Absolutely! Challenges we might have to face when implementing this strategy is well addressed in my article! I have emphasized the importance of using data-driven decision making for the recruiting process in this transforming world to help understand that advancements in technology have moved the way forward in recruiting.
DeleteNicely written and well organized article. This helped to gain a considerable knowledge regarding data driven strategy in recruiting ! Thanks!
ReplyDeleteIs good that you gained some knowledge from the article. Your thoughts on my article are also highly appreciated!
DeleteInteresting article Judith. Driving with Data needs reliable and accurate data, for which organization has to depend on the sources. Organizations rely heavily on these sources to fuel their decision-making processes, ensuring that each step taken in talent acquisition is well-informed and strategically aligned. The accuracy and security of the data becomes paramount, as they serve as the compass guiding organizations towards securing the right talent for the right roles.
ReplyDelete
DeleteThank you for the valuable insights you have given Sharfaz. Data-driven recruiting has become a crucial part in most organizations, as they are more concerned with accuracy and security.
Agreed! Data-driven recruiting resonates with the principles of systems theory, which posits that organizations are complex systems composed of interconnected parts. Just as systems theory emphasizes analyzing the interactions between components to understand the system as a whole, data-driven recruiting involves capturing and analyzing various data points to optimize the recruitment process. This approach aligns with the systemic perspective, emphasizing the importance of feedback loops, continuous monitoring, and adaptation to achieve organizational goals efficiently.
ReplyDeleteThanks for the contributions to my article. Highly appreciated and knowledgeable! Data-driven recruiting has become more popular in the digital age.
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