Discovering a tangible way to measure it can definitely be stimulating.We have especially found 3 ways for you to do it.
Evaluate and determine how many vacancies you would be recruiting in the coming year.
You can follow an easy way to calculate this. Just take your number of employees and multiply it by the percentage of attrition.
Taking an example, let's say you have 425 employees and your rate of attrition is 7.50%. If you multiply the number of employees with the attrition rate, you can figure out around 32 hires per year.
Remember that the 25 hires do not count the new jobs or number of openings.
It's also matters on the average salary is per hire. It's again difficult as you have varied or mixed job roles, however measuring the mean average. This is to indicate the agency placement fees.
This assists you to calculate approximately how many applications you would receive per hire and jot down what would be the annual cost of a Recruitment Administrator.
If we take the mean average salary to be $33, 333 in your company, use that figure over the yearly cost of your Recruitment Administrator and throw in 50 applications per hire.
The second method of measuring the ATS Software System ROI is to calculate the time invested on an application by a Recruitment Administrator without using an ATS Software.
Starting with downloading to screening the resumes and email communication, calculate the time invested by your administrator. Let's consider 15 minutes/application with 50 applications per hire we calculated and multiply this by 32 hires/year we have measured sums up to a substantial amount of time.
Your recruitment administration cost sums up to $6,811/year. However, by implementing an ATS Software, our anticipation is that the cost will reduce to $0. And your 1st saving is over $6000/year.
We mostly come across from new clients that one of their significant intentions are lessened their dependency on the recruitment agencies. For calculating ATS recruiting software ROI, it's key to work-out the ratio or the percentage of the hires which are resulted from agencies. As you pay a handsome fee to these agencies for every placement.
Taking the example, let's have 60% of your hires from these agencies, having a 15% placement fee. Now out of those calculated 32 hires, let 19 be hired by the agency. On applying 15% placement fee to the $33,333 average salary and multiplying it by 19 the annual cost leads to $95,624. With an ATS System, this can be reduced by 50% reducing your annual agency spending by $47,812.
With all calculations, you saved $54,623 on needless recruitment administration and agency fees. These are approx. statistics but they are completely logical to the current business set-ups. Give them a real thought and try to calculate with your own business metrics. Definitely, there are implementation fees to reflect along with the annual system license fee. However, based on the calculations, within a year best ATS Software would have paid for itself and with every year you should be seeing a compact ROI in overall costs.
If you want to know more about ATS Software, Please read our complete Guide of Applicant Tracking System for 2019.
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