Startup Best Practices 21 - Your Startup's Recruiting Scorecard
Last night, SaaS Office Hours at Redpoint welcomed Maia Josebachvilli, the VP of People and Strategy of Greenhouse. Maia is a thought leader in human resources. Specifically, she champions a metrics-based approach for developing world class recruiting teams. Because of her position, Maia has observed recruiting patterns in hundreds of companies, and has developed best practices for startups.
Maia reports these five strategic recruiting metrics to the executive team each quarter. These metrics resemble the diagnostics sales teams use to understand their funnel, and provide similar visibility into the efforts and successes of the team.
Qualified Candidates/QCs - the equivalent of a sales qualified lead, the QC is a leading indicator of whether the team will attain its hiring goals for the quarter. A QC is defined as a phone interview that qualifies a candidate as a good fit for a requisition. By understanding the QC to accepted offer rate over time, a company can forecast the odds of attaining the hiring goal that quarter, just as sales teams estimate bookings.
Days to Close - speed is a competitive advantage in recruiting because the most sought after candidates will have many options. Greenhouse and many other top recruiting companies maintain less than 30 day latency between first contact and signed offer.
Candidate Satisfaction - after every interview, Greenhouse sends a survey to interviewers to gauge their satisfaction with the process including how well the position was explained, how well prepared the interviewers were, whether they felt respected and treated courteously. Startups should aim for 70% or better.
Offer Acceptance Rate - what fraction of people who receive offers accept them? This figure should be quite high, 75% or greater in some cases. If the offer acceptance rate is low, the recruiting team should investigate. Some causes include lower candidate satisfaction, a slower days to close, unclear hiring parameters in the job requisition, and miscommunication between recruiting and hiring managers.
Hires to Goal - the total number of new hires divided by the goal. A company that isn’t achieving its hires-to-goal number should understand the bottleneck, whether in sourcing, evaluation or close.
A well structured kickoff meeting between the recruiter and the hiring manager is a fundamental requisite to success across all these metrics. In that meeting, the hiring manager and recruiter should define two things.
First, the 30 day goals of the role, from which a recruiter will distill the key skills required in the job. For example, a data engineering role may require familiarity with data analysis tools. Second, the long-term objectives of the job, which will reveal the attributes and values of the person. The same data analysis job would require an ability to learn new technologies and simplify complex data into comprehensible insights for the rest of a team.
After that conversation, the recruiting team can qualify candidates properly, describe the role, move candidates through the process quickly and prepare themselves to surpass their goals.
These five strategic metrics form a simple scorecard to help a startup’s management team evaluate the health of the company’s recruiting efforts each quarter. Consider using them in your startup.