3 ways to determine the ROI of recruitment software tools
Every agency wants to be successful—and profitable—but success in recruitment can take many forms. You might save time in the sourcing process through email automation and chatbot integration, or you could increase job page traffic by upping your demand gen activity. Even Implementing new software or a new process that makes your recruiters happier and more productive can feel like a huge success as well.
Learn how to measure the ROI of recruitment software tools with our complete guide below and toolkit full of helpful resources.
The benefits of measuring ROI of recruitment software tools
Measuring the ROI of recruitment software investments is essential to align business costs, enhance work efficiency, and refine strategic approaches. By analyzing the ROI of recruitment software, agencies can clearly demonstrate the tangible benefits these tools provide, including streamlined workflows, reduced time-to-hire, and improved candidate experiences. This detailed evaluation of costs — and benefits — allows for more informed decision-making, ensuring that every dollar spent aligns with the agency’s goals of driving efficiency and boosting business growth. Furthermore, understanding the ROI helps agencies identify areas for improvement and optimize their use of technology, ultimately refining their business strategies to stay competitive in the fast-paced staffing industry.
How much time do you save?
One of the most quantifiable and tangible ways to measure ROI with a marketplace partner is looking at the hours you’ll save. Traditionally, this means automating manual work so that your team can spend more time building relationships, prospecting clients, or making placements.
Before you demo with such a solution, perform some timed tests to determine how long it takes to perform functions that you could automate with a partner. This will allow you to come into a demo with an exact understanding of how much their solution will impact the specific workflow of your firm.
Of course, many other types of marketplace partners can help you save time, too. This might mean outsourcing a function like marketing or it could mean that you improve your ramp-up time during onboarding—the majority of recruitment professionals say it takes more than a month until a new hire is effective. Whatever your goal, take note of how much time you allocate currently, and how much time you can save. Use this data to calculate the ROI of the recruitment software tool based on time savings.
Does it improve your team’s product adoption?
Stepping up your team’s product adoption is one of the quickest ways to drive results. Solutions that elevate your team’s onboarding, training, and support will allow you to do more with what you have. Product adoption solutions help you get the most out of your recruitment software tools by keeping you fully trained on all their features and functionality.
How can you measure the effectiveness of product adoption? Consider combining employee surveys and core performance metrics. Employee surveys help you ensure that the onboarding experience is useful and intuitive and performance metrics help you determine the impact on your bottom line. Together you can use this information to calculate the ROI of the recruitment software tool. Some possible performance metrics to track:
- Job coverage
- Pipeline velocity
- Redeployment rate
- Fill rate
Does it increase team visibility into business performance?
Do you have insight into the metrics mentioned in the last section? Data is one of the most important assets you have as a recruitment business. Many partners allow you to capture, analyse, and visualise that data to help you better understand your business and how your teams are performing. We surveyed recruitment professionals to find out their most valuable performance metrics. Here are two of the top picks.
Fill Rate
57 per cent of recruitment pros rank fill rate as a top metric. It’s hard to argue with the pros on this one—fill rate is essential for understanding your company’s efficiency. A low fill rate (job orders filled/job orders received) is a warning sign and an invitation to dig deeper into your metrics.
Is there one weak link in your pipeline? Are your submittals not resulting in hires? Do you have trouble finding candidates for a position? Is your team shorthanded? Answering these questions could help you discover a solution to your fill rate woes.
Submittal-to-hire
The submittal-to-hire ratio combines elements of both quantity and quality, so it’s particularly useful as a tool to explore your productivity. If your agency has a high ratio, more qualification may be needed prior to client submittal. A low ratio? That’s not necessarily a bad thing, but it may point to a weak pipeline.
The sweet spot appears to be submitting three to four candidates for every hire made. Forty per cent fall into that bucket, compared to 24 per cent who submit four to five candidates and the highly-effective firms (14 per cent) who only submit one to two candidates per hire.
Do you have insight into these metrics? Visibility into these metrics—and many more—allow you to make smart decisions about your business. Visibility is also about more than analytics. Having proper integration with your solutions and your ATS is crucial to understanding the performance of your business.
Ultimately, the ROI that a marketplace partner’s recruitment software tool provides you will depend heavily on the unique circumstances of your business. If you have a strong understanding of your business now, you’ll be well-positioned to make the right decision for your firm.
To see how you can measure ROI with Bullhorn Marketplace partners, visit the Marketplace Partner Toolkit.