Applicant Tracking System Business Case Executive Summary As our company grows it is increasingly important to streamline processes while supporting the organization with the best talent. Currently, [The Company’s] recruiting processes are labor intensive, manual, and unstructured. Statistically, inefficiencies like these increase recruitment costs and decrease overall company profitability. In order to improve on recruitment efficiency, this presentation proposes the use of an Applicant Tracking System (ATS) to: • • • • Increase Recruitment Productivity Standardize Recruitment Processes Improve Recruitment and Hiring Compliance Facilitate Access to a Larger, More Qualified Candidate Pool In the pages that follow, a careful analysis of the problem and proposed solution are covered including quantitative and qualitative return on investment from financial, technical, operational, and strategic perspectives. Based on the many quantitative and qualitative benefits associated with the use of recruitment technology, it is recommended that [The Company] implement an Applicant Tracking System and supporting technology for job distribution. Business Problem (Delete any that do not apply) • Extended Time-to-Fill Financial •Prolonged Absence of Revenue-Generating Staff Member •Temporary Staffing Costs •Overtime for Workers “Filling in the Gap” •Overtaxed Staff Resulting in Decreased Morale • Time-Consuming, Manual, Disparate Processes Operational •Resume Review and Screening •Applicant and Recruiter Workflow •Manual Tracking (Candidate Flow, EEO, OFCCP, Etc.) • Insufficient Number of High-Quality Applicants Strategic •Good Candidates May be Overlooked •Quality Candidates May Not be Able to Find Our Job Listings Amid Competitors’ Noise • Inability to Generate Reports Technical •Measure Productivity •Identify Areas for Improvement •Monitor ROI of Recruitment Dollars Spent Proposal & Objectives Proposal: Implement the following recruitment technology(ies): (Delete any that do not apply) • Applicant Tracking System (ATS) • Automated Job Board Posting • Social Media Recruitment Software Objectives: (Delete any that do not apply) Realize Financial, Strategic, Technical, and Operational ROI • • • • Improve Recruitment Productivity Reduce Time and Cost-to-Fill Expand and Improve Quality of Applicant Pool Achieve and/or Maintain Compliance (EEO, OFCCP, Etc.) ATS Can Change Problems to Opportunities (Delete any that do not apply) Financial: Financial Operational • Reducing Time-to-Fill Improves Revenue1 • Reducing Time-to-Fill Improves Employee Morale, Customer Satisfaction, and Competitive Advantage2 Strategic: • 85% of Job Seekers Rely on Career Portals5 • Career Portals and Facebook are the Two • Most Important Places for Talent and Employers to Meet6 73% of Companies Successfully Hired Using Social Media7 1. http://www.careerbuilder.com/jobposter/smallbusiness/article.aspx?articleid=ATL_0093COSTOFUNFILLEDPOSITIONS 2. http://www.ropella.com/pdfs/Ropella-Cost_of_Vacant_Postions.pdf 3. http://www.emeraldinsight.com/journals.htm?articleid=1876817 4. http://www.eeoc.gov/policy/docs/national-origin.html Operational: Strategic Technical • Studies Show Standardization of Recruitment • Processes Result in 25% Reduction in Time-toFill and 30% Reduction in Cost-to-Fill3 EEOC Recommends Recruitment Standardization to Reduce the Risk of Discrimination in Hiring4 Technical: • According to SHRM, Effectively Managing • Workforce Productivity with Reporting can Increase Shareholder Value by 10 – 20%8 Organizations Using Workforce Analytics have 8% Higher Sales Growth, 24% Higher Net operating Income Growth, and 58% Higher Sales Per Employee9 5. http://www.blogging4jobs.com/hr/blogging4jobs-exclusive-85-of-job-seekers-rely-on-career-sites/ 6. http://www.potentialpark.com/wp-content/uploads/2013/02/OTaC-2013-Global-Results-Release.pdf 7. http://visual.ly/social-media-and-effect-recruitment 8. http://www.shrm.org/Research/Articles/Articles/Pages/ROI_20Series__20Benchmarking_20For_20Continuous_20Improvement.aspx 9. http://www.ilr.cornell.edu/cahrs/research/upload/Round-2-Moon-and-Li.pdf ATS Return on Investment Summary (Delete any that do not apply) •Increased Productivity •Elimination of Manual Processes •Time to Focus on Projects that Improve Profitability (e.g. Retention) •Improved Compliance •Access to Larger Candidate Pool & Higher-Quality Hires •Improved Candidate Experience •Increased Employment Brand Recognition •Single Database with Unlimited Data Storage •Easy Integrations •Web-based Solution Requires No Internal IT •Upgrades & Training Included at No Additional Cost Financial Technical Strategic Operational •Standardized Processes •Process Automation •Advanced Reporting for Continuous Improvement ATS Financial ROI: Quantitative Company Profile Increased Productivity Improved Compliance Web-Based Solution Requires No Internal IT Support (Edit the Company Profile to Personalize This ROI Calculation) Company Revenue # of Employees in the Company Total number of Vacant Positions Average # of Resumes Received Per Position Recruiter Cost Per Hour ($45k + benefits) Hiring Manager Cost Per Hour ($100K salary + benefits) # of Hours Per Week Spent Sourcing - Cumulative for all Recruiters # of Hours Per Week Spent on Manual Processes - Cumulative for all Recruiters (Excel Spreadsheets and Email Folders for Tracking Applicants, EEO, Manual Reporting) $25,000,000 200 5 200 $25.96 $57.69 5 Annual 40 Hours Per Hour Per Hour Hours ROI Calculations Without ATS With ATS Recruiting Costs Cost of Employment Advertising Per Vacancy Cost of Resume's Received, Sorted, & Reviewed (2 minutes per resume) Cost of Sourcing Activities $2,500.00 $865.33 $129.80 Recruiting Cost Total $3,495.13 $2,500.00 $432.67 $64.90 $2,997.57 Interviews Costs Recruiter Phone Screens (Assuming 10% of all resumes are phone screened) Hiring Manager Phone Screens (50% of Recruiter's phone screens are referred to hiring manager) 1 hour Face-to-Face Interviews - Recruiter (50% of Hiring Manager's phone screens equal interview) $259.60 $288.45 $129.80 $129.80 $144.23 $64.90 1 hour Face-to-Face Interviews - Hiring Manager (50% of Hiring Manager's phone screens equal interview) Interviews Costs Total $288.45 $966.30 $144.23 $483.15 Manual Processes Manual Processes (Excel Spreadsheets, Email Folders for Tracking Applicants, EEO, Manual Reporting $1,038.40 Manual Processes $1,038.40 $0.00 $0.00 Lost Revenue from Vacancy Average Lost Revenue per Day (calculated total annual revenue/# of employees/average 220 work days) $2,840.91 $2,840.91 Average time to fill in days 37 24 Lost Revenue from Vacancy Total $105,113.64 $68,181.82 Minimum Total costs (excluding travel expenses and onboarding) $110,613.47 $71,662.53 ROI $38,950.93 Technical ROI: Qualitative (Delete any that do not apply) Single Database & Unlimited Data Storage Easy Integration with other HR Systems All Candidates’ Information in a Single Location Eliminates Redundant Data Entry Facilitates Information Sharing Accessible by Recruiting Staff in All Locations Minimal / No IT Requirements Upgrades and Training Web-based Solution = No Onsite Servers Always have the Latest Technology Maximum Security Included at No Additional Cost Strategic ROI: Qualitative (Delete any that do not apply) Compliance Larger Candidate Pool Automated EEOC Tracking Social Media Job Distribution Automated OFCCP Tracking Employee Referral Programs Better Candidate Experience Employment Brand Awareness Standardized Application Process Social Media Job Advertising Branded Career Portal Branded, SEO Career Microsites Apply with Social Media Profile Branded Career Portal Operational ROI: Qualitative (Delete any that do not apply) Standardization Process Automation Standardized Application Process Automated Screening Standardized Recruiter Workflow Automated Candidate Ranking Standardized Documentation Automated Approvals Process Advanced Reporting Monitor Productivity Continuous Process Improvement Measure ROI of Recruitment Dollars ATS Risk Assessment Risk Risk Mitigation Purchasing an Applicant Tracking System that provides little/no tangible value to the recruiting team (Buyer’s remorse) During the initial selection phase, we will evaluate the value and quality of each vendors product offering. Considerations will include: free maintenance and software upgrades, extended hours for technical support, dedicated account management, free and unlimited data storage, and software configurability. Strategic Type Financial (Delete any that do not apply) To mitigate this risk it is imperative that our company select a highly scalable Applicant Tracking System. A Business developments result in dramatic growth highly scalable Applicant Tracking System will be able to quickly add new users and provide additional before ROI is realized (outgrow software too career portals. Additionally, a scalable Applicant Tracking System will not charge higher rates for data quickly) storage increases, increases in the number of jobs posted to the career portal, and will not require additional databases/modules to support our growth. Technical Operational Existing processes do not 'fit' into software capabilities While the recruitment team recognizes and accepts that some of our existing processes may benefit from change, other processes must be maintained because of our unique business needs. Accordingly, it is imperative to select an Applicant Tracking System that is highly configurable while supporting best practice strategies. Recruitment staff resistant to required process changes While a single point of contact must be selected to lead the Applicant Tracking System selection and implementation project, others on the recruitment team will be included in the requirements setting and selection process. Team inclusion will garner support and commitment as well as help to mitigate the risk of buyers remorse. Insufficient human resource experience with implementations and recruitment best practices As part of the selection phase we will consider the vendor's implementation experience and presence/absence of a consultative implementation approach as part of the value of the vendor's product offering. The goal is to identify an Applicant Tracking System vendor that can provide best-practice guidance for a streamlined implementation. Existing hardware cannot support new software requirements Selecting a web-based Applicant Tracking System will reduce/eliminate hardware concerns and expenses. Failure to identify all feature and functionality requirements While a single point of contact must be selected to lead the Applicant Tracking System selection and implementation project, others on the recruitment team will be included in the requirements setting and selection process. Team inclusion will garner support and commitment as well as help to mitigate the risk of failing to identify requirements. Conclusion (Delete any that do not apply) Implementing an Applicant Tracking System and associated job distribution will provide the company many benefits. These are: Recruitment Technology Benefits • • • • • • • Significant Return on Investment in All Areas of the Company Significantly Higher Productivity Faster Time-to-Fill Improved Compliance Standardized, Automated Process Better Candidate Experience Higher Quality Candidates From a technical perspective the barriers to entry are low as web-based software will eliminate the costs associated with internal IT and training /software updates are included at no additional cost by some vendors. Based on these findings, it is recommended that [The Company] move forward with implementing an Applicant Tracking System as soon as possible. Additional Opportunities Worthy of Investigation Talent CRM Software • Talent CRM Software provides an easy way to engage and nurture candidates who may not yet be ready to apply for a job, but are interested in the company’s employment brand. Career Microsites • Search engine optimized Career Microsites help to reduce reliance on third-party job board postings and other recruitment marketing techniques while increasing traffic to the company’s career portal. Onboarding Software • Onboarding software automates the candidate’s transition to productive new hire by reducing paperwork, and manage tasks more efficiently. This leads to improved HR productivity and employee engagement. I-9 and E-Verify Compliance Tool • I-9 and E-Verify Software provides automated and paperless preparation, signing, management, compliance auditing, and storage of Form I-9s, as well as automatic E-Verify submission.