The health of your hiring process and ability to convert prospective candidates to new team members rely on several factors. Measuring the hiring funnel often and throughout the hiring process can help uncover these factors and increase efficiency. This should be a relentless pursuit to iterate on what’s not working and clone what moves the right candidates through the funnel.
“The best founders take great pride in the quality of their team and do whatever it takes to get the best people to join them. Everyone says they only want to hire the best people, but the best founders don’t compromise on this point.”
Define the Funnel
Pro Tip: Companies who define and track each stage of their funnel will retain the health of their pipeline and continuously fill open roles with the right people quickly.
How companies define their funnel can vary depending on the needs of the organization. However, here are the most universal stages of a typical recruiting funnel:
Drilling down into each of these stages and defining what success looks like for a specific role or market will help inform any action that needs to be taken to improve conversion from stage to stage. When dealing with the top of the funnel (your total pool of qualified prospective candidates), we recommend that hiring teams consistently review the criteria used in the discovery process to make sure they’re still aligned with those used to vet candidates in later stages. When defining the criteria candidates must meet to move through stages of the funnel it is very important to think through any internal misalignments. If recruiters aren’t aligned with hiring managers and vice versa there will be a significant reduction in conversation rates further down the funnel; primarily in the interview stage.
While these may not be the only areas to focus on, we have found that defining the key stages listed above, identifying and talking through any internal misalignments, and measuring how each stage is performing will tweak the hiring process to move teams to a more consistent positive outcome. After a clear process has been defined, setting and measuring conversion rates will supply companies with clearly outlined goals to track success.
Measure Conversion Rates: How is each stage of the process performing?
Pro Tip: On average 15–20 candidates should make it to the phone screen.
The percentage of people that convert from one stage to the next is probably the leading indicator of efficiency. Too many people make it through? The search criteria are likely not selective enough. Too few candidates advancing? Likely the criteria are too strict, there might be a possible internal misalignment with hiring managers, or perhaps the role requirements have evolved but not yet communicated to key players. Adjusting the criteria and job description is an excellent place to begin if teams have diagnosed this stage of the funnel as the contributor to the process not yielding desirable results.
If teams are having trouble meeting these benchmarks some creative solutions may need to be tested. For example, if offer acceptance rates are low because candidates are declining, ask for feedback. The reason a person declines an offer may not be something that is easy to solve like benefits or salary, but maybe it’s an issue of the candidate not wanting to relocate. Is it possible to change the position to a remote role and still bring that person on board? These types of insights can be invaluable when inefficiencies are identified.
Another opportunity to measure and increase offer acceptance is the interview process itself.
“83% of talent say a negative interview experience can change their mind about a role or company they once liked. 87% of talent say a positive interview experience can change their minds about a role or company they once doubted.”
Very few candidates would describe the interview process as a positive experience and the truth is, most hiring teams do not perform well in this area. Top talent can be lost to an inefficient or biased interview experience. One solution for this common issue is to increase how quickly candidates are being contacted before and after a phone screen or interview, as well as work better to prep candidates for the in-person or technical interview. Prepping a candidate does not mean hiring teams are making it easier for candidates to move through interviews, it simply helps applicants put their best foot forward, which improves the outcome for all parties. A hiring manager who speaks to a well-prepared candidate will be able to more accurately gauge if the candidate will actually be able to fulfill the requirements of the role.
Setting everyone up for success in the interview process not only decreases the time it takes to close a requisition, but it also increases retention rates, which saves the company money in the long run. This, in turn, may reduce the time it takes to extend an offer which speaks to another key metric to measure within the recruiting funnel, time to hire. Time to hire is defined as the day hiring teams start sourcing to the day the offer is accepted.
🗣 Benefit of reducing time to hire: How much revenue is lost?
Pro Tip: According to a recent Lever report if you need to hire three sales reps each carrying a $1M per year quota, the difference in revenue between a 30-day time to hire vs. a 40-day time to hire is $27,000 per rep. Every day that a candidate is not hired translates into lost productivity or lost revenue.
The Society of Human Resource Management (SHRM) 2017 Talent Acquisition Benchmarking Report
While increasing speed to hire should not affect the candidate experience, it is an important contributor to a company’s bottom line. Time is money. The longer it takes to hire someone, the longer a company loses out on their valuable contribution. Once each stage of the hiring process has been combed through, it should be every hiring team’s goal to shorten the time a candidate spends in each stage of the funnel. The cost associated with keeping a role open can be exponential. No matter how many open requisitions a company has, reducing the time to hire positively contributes to the bottom line which can be quite significant.
Hiring great people takes a significant amount of intention and effort from all parties involved. An inefficient process is the largest contributing factor to requisitions becoming stale and eventually stalling. If the recruiting funnel proves to be inefficient, unfortunately, it cannot simply be solved by pouring more candidates into the top of the funnel. The end result will be frustrated recruiters, inefficient teams for hiring managers, and lost revenue and productivity for the company as a whole. Going back to the drawing board and internally realigning on the best way forward will produce an overall increase in experience for everyone at every stage. Meeting this challenge head-on may be hard work in some cases. No time wasted in taking a microscope to recruiting practices especially when the end result yields exponentially better outcomes. This will have a lasting and positive impact on overall company culture and productivity.
If you are a Fetcher customer, please feel free to reach out to your customer success manager if the criteria for your candidates need to change. If Fetcher is not currently removing the limits of manual sourcing for you or your teams, <a href=”https://www.fetcher.ai/contact?src=fetcher-blog" taret+”_blank”>request a demo today to learn how we can bring the right candidates to you by combining AI with a human touch.
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