Recruiting staff that are the right fit for your company is the most essential process in H.R. Despite its importance, the approach that many companies take to kick-start this process is to keep their recruitment drive internal.
Imagine asking all your friends to help you with your next home renovations. Unless they are all tradespeople, it doesn’t really make sense for most of them to want to do it. The same can be said of an internal recruitment process. The money that you are likely to save using internal recruitment (which has its place of course), or even doing a soft recruitment drive on Seek, Indeed or even LinkedIn may yield insufficient long term results.
The true cost of unfilled roles
Unless you are well informed of the need for new staff ahead of time, you will likely to lose productivity through the unfilled position. Not only does an unfilled role carry a lead time if you don’t have someone on the horizon, but the work that is left will usually be undertaken by someone else in the organisation. This can lead to stretching people thinly, and a domino effect can cascade down to more sick days, and potentially more roles to fill. There are many cases of one unfulfilled role leading to several more bad cases.
The time of your recruitment manager
It’s a common joke the managers saddled with the task of interviewing new recruits loathe the time taken and the questions they have to ask. Not only does it grate on their nerves, it wastes the time that they could use to further productivity. Hiring an external professional to do the same task would save that time, but it of course adds to the overall recruitment costs.
The true cost of training
After you manage to find a new recruit, and are willing to pay the cost to hire and train them, you’ll then need to put in the time involved to train them. Training is an incredibly time consuming process, as not only do you potentially need to take away from another employee or manager’s time, but training materials can be expensive. Investing in training modules for highly skilled roles, or upskilling current staff to be able to train others can create time inefficiencies across the board.
The most efficient cost reduction strategy is Retention
As alluded to earlier, using a recruitment specialist may be an effective strategy, but not a cost effective one.
The most effective strategy for keeping recruitment costs down is to increase retention. Even small increases in retention can greatly impact the bottom line recruitment costs. If you consider that you’ll have to hire one less person every year, that can have significant effects to overall employee engagement. Increasing retention, combined with a positive company culture will lead to significant cost savings across the board.
A strategy focused on retention helps to reframe recruitment costs not as a matter of bottom line impacts, but more of a question around soft strategies involving company culture, employee engagement and a lot of the other factors that help employees stay in their role.