What are the most effective ways to measure the ROI of your talent acquisition strategies?

1 Define your goals and metrics

To measure the ROI of your talent acquisition strategies, you must define your goals and metrics. What are you trying to accomplish? What KPIs reflect your success? How will you collect and analyze the data? Quality of hire, time to hire, cost per hire, source of hire, and candidate experience are all common goals and metrics for talent acquisition. Quality of hire looks at how well new hires perform and fit in your organization. Time to hire measures the length of time it takes to fill a vacancy. Cost per hire considers the money spent on advertising, sourcing, screening, interviewing, and onboarding. Source of hire examines where new hires come from. Finally, candidate experience evaluates how satisfied and engaged candidates are during the hiring process.

2 Calculate your ROI

The next step to measure the ROI of your talent acquisition strategies is to calculate your ROI. There are different ways to do this, but one simple formula is:

ROI = (Benefits - Costs) / Costs x 100%

Benefits are the positive outcomes of your talent acquisition strategies, such as increased revenue, reduced turnover, improved performance, or enhanced reputation. Costs are the negative outcomes of your talent acquisition strategies, such as the money spent on hiring, the time spent on recruiting, or the opportunity cost of unfilled positions. To calculate your ROI, you need to assign a monetary value to both benefits and costs, and compare them over a specific period of time.

3 Benchmark your results

The third step to measure the ROI of your talent acquisition strategies is to benchmark your results. Benchmarking is the process of comparing your results with those of other organizations or industry standards, to see how you perform relative to them. Benchmarking can help you identify your strengths and weaknesses, set realistic and achievable goals, and track your progress and improvement. You can use various sources of data to benchmark your results, such as surveys, reports, studies, or platforms that provide talent analytics and insights.

4 Communicate your findings

The final step to measure the ROI of your talent acquisition strategies is to communicate your findings. Communicating your findings is crucial to demonstrate the value and impact of your talent acquisition efforts, and to gain support and buy-in from your stakeholders. You should communicate your findings in a clear, concise, and compelling way, using charts, graphs, stories, or testimonials to illustrate your points. You should also highlight the key takeaways, recommendations, and action plans based on your findings, and invite feedback and collaboration from your audience.

5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?