The goal of every hiring team is to provide their company with the best talent available while being both effective and cost-efficient. When it comes to the hiring process itself, this can be easy to measure. Costs are easily tied to time and the number of hires. However, what about the quality of hire? Is your hiring strategy bringing in the best talent possible?
What is Quality of Hire?
Quality of hire is the measurement of how much value a new hire brings to a company and how that value contributes to the overall bottom line. Calculating this exact value can be difficult. However, this difficult-to-define metric is considered a very useful KPI. LinkedIn’s 2016 global trends report listed it as a priority for 40% of major companies worldwide. It is this metric that drives companies to focus on building effective recruiting processes. Albeit, hiring efficiency doesn’t translate directly to good hires.
Quality of hire is more than cost-effective recruiting. It’s about thinking of the future, long after the hire is made.
Talent Acquisition Data
When HR professionals consider the hiring process, they typically measure it in two key metrics — cost-per-hire and time-to-hire. Cost-per-hire allows recruiters to directly measure the cost-effectiveness of their recruitment strategy. Time-to-hire measures the gap of time between a recruiter contacting a candidate and a candidate accepting the position.
These intertwined metrics are great for measuring the efficiency of the hiring process and are relatively easy to determine. Unfortunately, the quality of hire is much more complex and harder to measure. This is in part because there is no one-size-fits-all approach to measuring the quality of hire. Every role, department, and company is different. According to LinkedIn, only 33% of companies report feeling like they’re using the right approach to measure it.
Metrics You Can Use to Assess Quality of Hire
Despite the challenge of assessing the quality of hire, there are some key indicators worth considering. These include job performance, retention, and ramp-up time.
- Job Performance - The most obvious metric to consider is job performance. Although performance can be subjective, 50% of companies surveyed by LinkedIn considered performance reviews when measuring the quality of hire.
- Retention - In simplest terms, the longer employees work for a business, the more value their hire contributes to that business. As such, many companies leverage turnover metrics to factor into their quality of hire.
- Ramp-up Time - Many organizations also consider ramp-up time, the time it takes an employee to reach productivity, an essential metric to consider when measuring the quality of hire.
And these are only three of the many metrics companies use to assess the elusive quality of hire.
Build Better Relationships with Hiring Managers
One key area that can improve your quality of hire is to improve your intake strategy. Aligning recruiters and hiring managers with the same goal at the start of the hiring process ensures everyone is on the same page. It’s the best time to define what is needed in a new hire.
Qualifi is an interview tool for more than just your interview process, it allows for improved team collaboration across the entire team to maintain the best hiring standards possible. With Qualifi, recruiters can work directly with hiring managers within the platform to track applicants during the hiring process and share feedback every step of the way. See a demo today to see how an on-demand interview platform can improve your quality of hire today.