Measuring Staffing Efficiency
It is fairly easy to measure the efficiency of your staffing processes. Any construct that measures time, speed, cost, or volume is a measure of efficiency. In staffing terms, the efficiency of your process might be measured in terms of how many openings are filled (a measure of volume), how quickly an opening is filled (a measure of speed), or cost per hire (obviously a measure of cost). Examples of staffing efficiency measures include these:
Time or speed measures
Average time to fill an opening (all openings)
Time to fill (external sources only)
Time to fill (internal sources only)
Number of jobs filled per time period (e.g., month or quarter)
Average time between requisition and acceptance (or start date)
Average time between requisition and interview
Cost measures (Chapter 24 includes a detailed discussion of how staffing costs can be calculated and analyzed)
Average cost per hire
Cost per hire per source (e.g., Internet vs. referral vs. agency)
Cost per interview
Cost per acceptance
Cost per promotion
Cost per relocation
Volume measures
Acceptance rates
Number of jobs filled (in total)
Number of candidates per source
Number of candidates per opening
Ratio of callbacks to initial interviews
Job posting response rates
Turnover rates
Number of losses
Each of these measures can be tailored to meet your specific needs (e.g., you can define hit rates for specific agencies in order to identify those that are the best sources for a particular type of skill). Also, remember to use measures that focus on the issues you are addressing (e.g., don’t use internal measures for jobs that are usually filled through external sources).
Efficiency measures are usually applied in the near term (i.e., within a planning period). To create a more meaningful analysis of efficiency, compare values over time. Calculate values for each planning period for each measure that you use and then compare the measures across planning periods (comparing results from one period to the next).
As you develop and apply efficiency measures, keep in mind these two cautions:
Be careful when using overall averages as measures. Averages often mask what is really happening, especially when they include different jobs under different circumstances. In a situation in which one job category is filled quickly and one takes a long time, the average of the two may seem to indicate that the overall time to fill is acceptable when, in fact, the time to fill for that second job category is unacceptably long. The same problem can arise when measuring cost per hire per source. Calculating an average cost across similar sources (e.g., agency hires) might hide the fact that one particular source (in this case, a particular agency) is significantly less expensive than the others. If you do use averages, make sure that you include only equivalent jobs in each group.
Avoid using absolute measures or standards. Suppose, for example, that you set a target that all jobs should be filled within 60 days. It is possible that for one type of hard-to-fill job, a time to fill of 90 days or more might be quite acceptable, yet 90 days exceeds the 60-day target. For a different, easier-to-fill job, 30 days may be too long a time, even though that would meet the 60-day standard. Set standards that are appropriate for the jobs being analyzed.