What is Talent Acquisition?
Talent acquisition is the process of identifying and acquiring skilled, experienced employees to meet a company’s goals. The talent acquisition department is responsible for identifying, acquiring, assessing, and hiring applicants to fill open positions within a company. Talent acquisition also incorporates company branding, human resource planning, labor force diversification, and developing a solid candidate pipeline.
In some companies, the talent acquisition team is part of the Human Resources department. In other cases, Talent Acquisition is a separate department that works in coordination with HR. Experienced talent acquisition professionals have specialized skills in sourcing strategies, candidate assessment, compliance, and hiring standards. They are masters in employment branding practices and corporate hiring initiatives.
There is a significant difference between recruiting and talent acquisition. Firstly, recruitment means that you’re looking to hire someone—literally anyone—in order to fill a vacancy. Talent acquisition, on the other side, is focused on the crucial hire. It’s a strategic process of looking for specialists, leaders, future executives, or other high skilled professionals for a specific position within the company.
How to adopt a Talent Acquisition strategy that brings true value
Data-driven recruiting is becoming a significant competitive advantage in today’s knowledge economy. Many tech companies have made their talent acquisition more precise, while most other companies still rely on stomach feeling and vague measurements when trying to improve their results in hiring relevant candidates.
Since more and more companies are adopting Artificial Intelligence to advance the hiring process, the market offers a variety of tools that can facilitate talent acquisition strategy implementation. Tools such as X0PA or TalentLyft can help companies to shortlist the most relevant talent according to a job description. Smart recruiting assistants, like Employa, go further and help you find diamonds in the rough—its smart engine finds additional information about the applicants, enriches their CVs, and looks for true experience instead of buzzwords. In addition, it has a fraud detection module that reveals different kinds of fraud and inconsistencies in the CV.
Today companies can choose the most suitable approach to create a talent acquisition strategy from a variety of options. Many companies utilize an Attraction-Selection-Attrition model, a framework for understanding organizational behavior that integrates both individual (micro) and organizational (macro) perspectives by explaining macro organizational attributes with micro person characteristics. But for those businesses who prefer straight-forward approaches, the steps for defining a talent acquisition strategy are as follows:
Set smart goals
Company leaders who set out to assess and improve their hiring process often have unrealistic definitions of success. In the end, they are disillusioned with their human resource managers when it’s not really HR’s fault. The most talented recruiters can’t produce the impossible, and even the best hiring processes can’t guarantee 100 percent success.
Top-notch recruiting practices are important, but even the best-recruiting decisions will not always lead to the desired hiring outcomes. Don’t expect an ideal business impact from your recruiters and don’t get disappointed by occasional failures. Start by defining clear metrics of success and track these over time to see how you are performing and improving.
You may have heard that strategy is the art of deciding what not to do. Nevertheless, many businesses do not think strategically when they work on their talent acquisition strategy and often set up metrics that work against each other.
For instance, they want to reduce time to hire while also wanting more A-players. If you want more superstars, you have to be patient and understand that recruiters need to spend more time on search. In that case, you must set priorities and performance metrics that reflect seeking A-players. The best hands-on advice is to set up KPIs with a talent acquisition team and consider their feedback.
Measure your acquisition metrics
Most companies have a rigorous recruiting process, but only a few have a clear process for measuring results. Companies often go about improving their recruiting processes without defining good and bad, outstanding and unacceptable.
Сompanies with well-defined hiring processes track which of their efforts bear fruit and which need to be revised. That means you should clearly define KPIs and metrics of success before adopting any new hiring methods. Companies with strong organizational processes should avoid «whatever it takes»-style management, as they might end up rewarding self-promoters instead of those who increase your team’s overall business impact.
The most important metrics in Talent Acquisition
The talent acquisition process differs depending on the company size or industry, but it goes without saying that any company can benefit from correct tracking of talent acquisition KPIs.
The talent acquisition technology landscape continues to evolve every year with new providers entering the market and traditional providers expanding their offerings. Evaluating and selecting the right technology partner is becoming increasingly complex as companies try to navigate this new landscape. Additionally, business leaders are putting more pressure on talent acquisition to make strategic decisions and demonstrate the value of their investments. According to Aptitude Research’s 2019 Talent Acquisition survey, companies are using up to 20 different technology solutions and only 38% of SMB companies are measuring the ROI of their investments.—Madeline Laurano, Founder at Aptitude Research Partners
For those who are just beginning to set hiring goals, we collected a list of top talent acquisition metrics:
- Time to hire
- Cost of hire
- Turnover rate
- Time to fill
- Candidates per hire
- Application completion rate
- Fill rate
- Candidate call back rate
- Employee referrals
- Retention rate
- Satisfaction rate
Which Talent Acquisition metrics to track in 2021?
The role of recruiter and talent acquisition manager tends to change over time. Recent LinkedIn research shows the growth of non-recruiting jobs in the recruiting department, e.g., «talent analytics» roles have grown by 111% since 2014. That means talent acquisition activities and metrics will be focused on capturing business impact, not just tracking actions.
If your talent acquisition team is like most, you probably already track time to hire. It’s one of the most used talent acquisition metrics for good reason—it’s easy to measure and sets expectations—but it doesn’t have high strategic value. Time to hire can tell you how fast your team hires, but not how well they do it. For example, a slow recruiter who hires 5 high performers in a month is much more efficient than one who hires 15 poor performers in a month.
The fastest hire isn’t the best hire, and the cheapest hire isn’t the best hire. It’s all about the result—the business impact.—Ross Baron, Head of Recruiting for Western Europe, TikTok
If you follow tactical metrics—time to hire, candidates per hire, or offer acceptance rate—you are tracking the immediate actions of your recruiters. That’s a good start, but talent acquisition in 2021 will revolve around strategic metrics: those that measure the business impact of your recruiting team’s performance—not just the actions they take.
The importance of talent acquisition is rising and results-based metrics will rule the future. Shaping a company’s talent strategy will be just as important as executing it. To succeed, you’ll need to focus on the metrics that really matter for business.
The two most crucial metrics in 2021 are both strategic and data-based measures. Quality of hire and sourcing channel effectiveness—a metric that measures which sources produce quality hires—are both focused on the business impact of the people your team is bringing in.
Quality of hire refers to the value a new hire adds to your business; in particular, how much a new hire contributes to your company’s long term success. From this definition, it’s clear why quality of hire is a high priority.
You can’t calculate quality of hire right after the job offer is accepted; it requires waiting several months. But the important issue is that most recruiters don’t know exactly how to measure or define «quality.» There’s no golden rule, but generally quality of hire is defined as a blend of three key metrics: employee retention, engagement, and performance.
Sourcing channel effectiveness or SCE helps to calculate the conversions per channel. You can easily identify the effectiveness of different channels by comparing the number of applications with the number of impressions of the positions.
Diversity metrics, e.g., gender or ethnicity of candidates aren’t used today, but many recruiters consider these metrics important and useful.
For diversity recruiting, we need to think about metrics differently. We’re focused on outcomes overactivity, but we also care about arriving at them in an inclusive way. The right metrics can illuminate the path forward.—Chris Louie, Senior Director of Talent Acquisition, LinkedIn
Most talent acquisition teams still aren’t tracking either, but the metric with the biggest gap between usefulness and actual use is candidate experience, a measure that will probably become more ordinary in the near future.
Time to fill and time to hire metrics are obvious and commonly used, but to increase the hiring efficiency and reach the KPIs that will create business impact, recruiters should pay a lot of attention to quality metrics and the right tools to measure them.