7 Steps To Cut Recruiting Costs & Drive Exceptional Business Results
- by Oracle Accelerate for Midsize Companies
By Steve Viarengo, Vice President Product Management, Oracle Taleo Cloud Services
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In good times, trimming operational costs is an ongoing
goal. In tough times, it’s a necessity. In both good times and bad, however,
recruiting occurs. Growth increases headcount in good times, and opportunistic
or replacement hiring occurs in slow business cycles. By employing creative
recruiting strategies in tandem with the latest technology developments, you
can reduce recruiting costs while driving exceptional business results.
Here are some critical areas to focus on.
1. Target
Direct Cost Savings
Total recruiting process expenses are the sum of external
costs plus internal labor costs. Most organizations can reduce recruiting
expenses with direct cost savings. While additional savings on indirect costs
can be realized from process improvement and efficiency gains, there are direct
cost savings and benefits readily available in three broad areas: sourcing,
assessments, and green recruiting.
2. Sourcing:
Reduce Agency Costs
Agency search firm fees can amount to 35 percent of a new
employee’s annual base salary. Typically taken from the hiring department
budget, these fees may not be visible to HR. By relying on internal mobility
programs, referrals, candidate pipelines, and corporate career Websites,
organizations can reduce or eliminate this agency spend.
And when you do have to pay third-party agency fees, you can
optimize the value you receive by collaborating with agencies to identify
referred candidates, ensure access to candidate data and history, and receive
automatic notifications and correspondence.
3. Sourcing:
Reduce Advertising Costs
You can realize significant cost reductions by placing all
job positions on your corporate career Website. This will allow you to reap a
substantial number of candidates at minimal cost compared to job boards and
other sourcing options.
4. Sourcing:
Internal Talent Pool
Internal talent pools provide a way to reduce sourcing and
advertising costs while delivering improved productivity and retention.
Internal redeployment reduces costs and ramp-up time while increasing retention
and employee satisfaction.
5. Sourcing:
External Talent Pool
Strategic recruiting requires identifying and matching
people with a given set of skills to a particular job while efficiently
allocating sourcing expenditures. By using an e-recruiting system (which drives
external talent pool management) with a candidate relationship database, you
can automate prescreening and candidate matching while communicating with
targeted candidates.
Candidate relationship management can lower sourcing costs
by marketing new job opportunities to candidates sourced in the past. By mining
the talent pool in this fashion, you eliminate the need to source a new pool of
candidates for each new requisition. Managing and mining the corporate
candidate database can reduce the sourcing cost per candidate by as much as 50
percent.
6. Assessments:
Reduce Turnover Costs
By taking advantage of assessments during the recruitment
process, you can achieve a range of benefits, including better productivity,
superior candidate performance, and lower turnover (providing considerable
savings). Assessments also save recruiter and hiring manager time by focusing
on a short list of qualified candidates. Hired for fit, such candidates tend to
stay with the organization and produce quality work—ultimately driving revenue.
7. Green
Recruiting: Reduce Paper and Processing Costs
You can reduce recruiting costs by automating the
process—and making it green. A paperless process informs candidates that you’re
dedicated to green recruiting. It also leads to direct cost savings.
E-recruiting reduces energy use and pollution associated with manufacturing,
transporting, and recycling paper products. And process automation saves energy
in mailing, storage, handling, filing, and reporting tasks. Direct cost savings
come from reduced paperwork related to résumés, advertising, and onboarding.
Improving the recruiting process through sourcing,
assessments, and green recruiting not only saves costs. It also positions the
company to improve the talent base during the recession while retaining the
ability to grow appropriately in recovery.
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