No business can survive without human resources. Every business, big or small, thrives on the capability of its recruitment force. The art of recruiting relies on finding candidates that perfectly fit the roles and are conducive to an organization’s growth. The right selection of a candidate can make or break companies.
Given its importance in the overall company performance, it is also a time-consuming and expensive process. Hiring is one of the major expenses of any organization. The cost of recruitment depends on a few factors such as the industry, job location, supply and demand forces, skills needed for the job, etc. There is also a cost associated with the entire recruitment process, such as job advertisements, recruiter salaries, employee relocation costs, recruiter or consultancy fees, referral payment, etc.
There are a few steps that are a part of any recruitment process:
- Identifying the need
- Creating the job description
- Posting the job on various platforms
- Building a talent pool
- Shortlisting candidates
- Arranging interviews
- Selecting the candidate
- Making an offer
After this, there are two scenarios. If the candidate accepts the offer, then, job well done. It moves on to the induction process. However, if the candidate declines the offer or you are unable to fill the position, you may have to go back up the chain and start the process from another point that you identify as a roadblock.
Every single step requires spending, and so the average hiring cost also varies. According to Google calculation, the average cost per hire for companies is $14, 936. So, the goal of recruiters is to reduce the cost per hire.
Implementing innovative recruiting strategies will help companies reduce their hiring costs. Here are a few cost-effective strategies that we suggest:
Analyze the Requirement
For any task, research is the first thing to do. The same applies to recruitment. Before starting on the candidate search, recruiters should fully analyze the company’s requirements. Is the role temporary or permanent or contract-based? If the requirement is permanent, can it be converted to a temporary one to save cost and time?
What are the skills and qualifications that can be found in the ideal candidate? How close can you get to that? By knowing such details beforehand, recruiters can sharpen their recruitment process as well as source candidates faster.
Internal vs. External Hiring
Many a time, it isn’t just the HR department that is involved in the recruiting process. People from the concerned department, as well as those in leadership/CXO levels, may also be roped in. When CXOs need to get involved in the recruiting process, it takes away their time from critical decision-making aspects.
In such a case, it is essential to have a strong internal hiring team that can take care of it on their own. However, smaller companies may not have a large and strong HR team. Here, they can depend on external hiring agencies. This can help them save costs on recruiting an HR team and bypass the task to external sources.
Automate Recruitment Process
Check with any recruiter, and you will find that much of her time is spent in monotonous routine work such as screening, shortlisting, communicating, etc. All these can be easily automated to improve the hiring team’s productivity and save costs.
JoinEight is an AI platform that helps companies save 40-50 percent of the time per hire. JoinEight’s predictive analytics will help companies find best-fit candidates in no time, which helps companies save 90 percent of their hiring costs.
Funnel of Quality Candidates
A study by the SHRM states that it takes 6-8 months salary to replace an employee. This shows how vital it is to get recruitment right. Recruitment managers tend to agree that replacing candidates is more expensive than hiring for a new role. This is because processes are already in place for that role, while a new role is not yet integrated into the company’s structure.
What recruiters can do to overcome this challenge is to put in extra efforts to identify a bunch of best-fit and quality candidates when hiring the first time itself. In other words, create a funnel with quality candidates. JoinEight’s Predictive Powered Recruiting will help companies build their sourcing funnel with best-fit candidates through artificial intelligence.
Leverage Social Networking Sites
Social networking sites have emerged as one of the top tools to recruit candidates. By making the best use of sites like LinkedIn, Facebook, Angelist, etc., companies can create pages and post about company values, work culture, and open positions. Instead of going to candidates, the candidates come to you.
It also helps to improve company brand awareness. We also recommend recruiters to motivate employees to share recruitment-related posts on their personal timelines to amplify the reach.
Maximize Employee Referral Program
Research shows that referrals are one of the top ways candidates learn about new openings. Employees refer their best candidates who will also mix with the company culture. Such employees also tend to stick around longer.
Many studies show that employee referral programs are a long-term strategy for companies to yield better results. There are, of course, immediate expenses such as bonus payouts, but in the long term, it saves cost per hiring and improves employee retention rate.
Plan for Future Positions
As companies grow, the demand for new roles keeps increasing. Additionally, companies expand their department and operational areas as well as divide existing ones into sub-categories.
Recruiters need to be ahead of the game. They should constantly be in touch with the management to understand future company goals and prepare accordingly. If new areas are coming up, they need to start building a talent pool to fill those roles quickly.
Training and Onboarding
On average, an employee will take about eight to 26 weeks to reach the company’s optimal productive stage, irrespective of skill, and industry experience. While this may sound like a long period, management needs to give people enough time to adjust to the company culture and working style before taking a call. Not giving this training period not only means losing out on top talent but also incurring more expenditure on finding a replacement.