It's not news that corporations are investing many, many thousands of dollars in their Applicant Tracking Systems. The often hidden and sad part of this story is that despite this hefty investment, the typical company realizes a very poor return on their investment. It doesn't have to be that way. When you consider upfront ATS costs such as: implementation, data migration, and training, employers are now investing in the range of $190,000 to $330,000 for their ATS solution. Larger employers are investing much more. While this is a significant investment, that's just the beggining! Even after you add the ongoing annual costs of about $6,000 per recruiter, we still haven't calculated the unnecessary costs resulting from poor utilization of the ATS search capability, and that is the focus of this week's article. Costs associated with inefficient use of the ATS search engine fall squarely on the shoulders of the user, not the ATS vendor.

The Costs of Recruiter Inefficiency

One of the key reasons for such a dismal ROI is that most recruiters don't know how to use their ATS search capability. This is the obvious conclusion after my recent interviews with some of the best known ATS vendors and their top power users. And you can bet that if recruiters don't use the search engine effectively, they aren't likely to use the other parts of the system very well either.

Here's what one power user had to say, "I've used five well-known ATS while working for several large Fortune employers, and my experience is that recruiters really don't know how to use the search engine." He went on to add, "In fact, I believe that only about one recruiter in 10 really knows how to use the search engine effectively. They often don't know how to use simple Boolean search terms, much less some of the other great search features. In fact, I worked for one Recruiting Manager who was ready to throw the ATS out because she couldn't find qualified candidates in the ATS database for a job she was working on. I took the same job and quickly found 7 great candidates where she had found none." With only about 10% of recruiters really being efficient with the search engine, it's not a mystery that a better ROI isn't being realized.

Things that Drive Your Costs Up and Your Efficiency Down

When recruiters lack the skills to maximize the ATS search engine, the results are tremendous inefficiencies and higher costs. Here are three of the most frequent inefficiencies that drive up cost.

1. Positions that stay vacant too long cost big bucks - Some of the most conservative research estimates indicates that for every day a position remains vacant it costs the employer about $7,000. If one recruiter takes 15 additional days to make a hire, that amounts to $105,000 per recruiter, per position. That equates to millions of dollars of unnecessary cost every year.
2. Your competitors beat you to the top candidates - When recruiters don't utilize the ATS search and match capabilities efficiently, hot candidates are often overlooked or at best discovered late. When you're late finding the candidate you've likely just lost the candidate to your competition. One way to check this out is by tracking how many people have already accepted other positions when you call them or are already at the decision point on other offers. This loss is all due to using an ATS search and processing capabilities incorrectly - time to process is the key
3. Recruiter's ineffective ATS search methods wastes thousands of dollars - To illustrate this point, I'll use current hiring data from one of our clients. In this case, if their recruiter's made a 20% increase in productivity, that would equate to one more hire per month, or 12 per year per recruiter. Using their current cost data, that equates to a $60 thousand savings per year per recruiter. You might actually be able to make a 30-50% productivity improvement just by learning how to use the search engine.

To Get Better Right Away, Here's a Five-Point Action Plan

1. Give everyone of your recruiters a test to find a hidden candidate from those that have just applied or from the resume database. Then compare the results. Next reverse engineer the most efficient search criteria and make that part of your recruiter training.
2. As part of your ongoing training, evaluate the quality and number of candidates returned by comparing the search results of the best search strings vs. average ones. Great search techniques will bring the best candidates to the top of your search results list.
3. Set up an online wiki to capture your best practices and make sure every recruiter uses them. If you're willing to share your best practices with me, I'll put them up on an Adler Wiki for all our readers to utilize. That way, all of us can benefit. Send yours to This e-mail address is being protected from spambots. You need JavaScript enabled to view it .
4. Ask your ATS vendor (or us) to conduct a survey of each recruiter's skill level using the ATS. Next, have them (or us) conduct an online training program. I guarantee it will cost less than $60,000!
5. Offer some sort of reward to recruiters who come up with new, innovative methods and search strings that work well. Recruiters will love the challenge and it shows them how important using efficient ATS search methods can be. These rewards don't have to cost a lot, perhaps something as simple as tickets to a sporting event or dinner for two at a nice restaurant.

Effective use of your ATS is very much a bottom line consideration and if you haven't treated it that way, you're wasting your employer's money. If you're going to invest in a top ATS, at least get your money's worth! Your ATS can be a competitive advantage, but only if it's full potential is realized.

In a market that has a shortage of talent, recruiter inefficiency is costly and is just plain bad business.