THE TECHNACIOUS RECRUITER NEWSLETTER

August 20, 2009   view past issues

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The New Metric: Return on Influence

ROI is a term much in vogue these days in the recruiting field. Defined as “return on investment,” it is typically used to evaluate how much value we receive from the money we spend. It’s a way of both gauging the financial or quantitative benefit derived from a particular course of action and evaluating the relative benefits of alternative courses of action.

We use ROI, for example, to determine the effectiveness of our recruitment advertising. If we spent $5000 on job board A, how many applicants did we receive? And, if we spent the same amount of money on job board B, did we receive as many or fewer applicants?

Admittedly, the analysis would be more rigorous if we also assessed the quality of those applicants, but quality of hire is still a largely subjective measure and thus difficult to use in quantitative analysis. Even more problematic, ROI-at least as it is currently defined-does not provide an effective way to assess investments made in currency other than money. It does not help us to evaluate behavioral investments.

What’s a behavioral investment? In recruiting, at least, the most prevalent form is networking. Most recruiters believe it is the single best way to acquire high caliber talent so it has long been a staple of their sourcing toolkit. And today, social media sites have made networking easier and less time intensive than it has ever been.

But what’s the benefit derived from that investment? And how do you measure it? The answer, I believe is best determined with a new kind of ROI, one I call “return on influence.”

Return on influence measures the financial or quantitative benefit derived from a recruiter’s use of their most precious asset: time. Given the limits of human activity, that time is just as scarce an organizational resource as the budget for recruitment advertising. Therefore, it’s entirely appropriate-indeed, it is the recruiting team’s fiduciary responsibility–to ensure that it’s being invested wisely.

Evaluating Your Behavioral Investments

As with traditional ROI, return on influence can be used to assess both a particular course of action and the relative merits of alternative courses of action. For example, if a recruiter invests 6 hours of their time networking with prospects on LinkedIn, how many people did they influence sufficiently to apply for or at least express an interest in their opening? And, if they invest 6 hours in networking on LinkedIn and 6 hours on Facebook, where are they most influential?

Calculating the objective measure of that return is simple enough. The math is rudimentary. Determining the actual value of the numbers, however, requires much more rigorous evaluation. Moreover, there is no commonly accepted scale or schedule with which to gauge a recruiter’s influence so the analysis will necessarily be idiosyncratic to each organization and the kinds of talent it is seeking.

For example, if the recruiter influences just one candidate to apply for their opening, that outcome may be viewed as effective by one organization and a dismal failure by another. The first organization may have a less appealing employment brand or be located in a less desirable location than the second organization so it is a huge feat to persuade even one person to apply.

Similarly, if a recruiter is able to talk just one heart surgeon into applying for their opening, that return is likely to represent real success. On the other hand, if they are trying to source investment bankers or lending officers, it would probably be viewed as inadequate.

Perhaps the best use of return on influence, however, is in evaluating the relative merits of alternative sourcing strategies. While networking is often confined to a single source, it can also take a recruiter to multiple venues in the course of the same search for candidates. They might start on LinkedIn, for example, and a contact there might send them to a discussion board on an association site where another contact might lead them to Facebook. In this situation, it would be difficult to assess the merits of each networking site, but it is possible to do so for the entire investment of time. The return on that total investment, in turn, can (and should) be compared to the yield generated by other sourcing activities, including recruitment advertising, campus visits, and job fairs. There is no other way to ensure organizational resources are being expended correctly.

Some, of course, will say that recruitment advertising generates too many applicants and their quality is too poor. They turn to networking as a result. I would respectfully suggest that the logic in that decision is flawed. Networking may indeed be a better sourcing strategy, but it’s impossible to know if that’s true until recruitment advertising is accomplished effectively, and in many organizations today, it’s not. If you have any doubt about that, read some of the job postings that appear on job boards. They’re a sure-fire cure for insomnia.

Return on influence isn’t a substitute for return on investment. The two ROIs are actually complimentary. They will both help a recruiting team to ensure that it is deploying its limited resources as effectively as possible. Traditional ROI measures the value of its financial investments-the advertising power of its budget-while the new ROI measures its behavioral investments-the influential power of its recruiters’ time and talent.

Thanks for reading,

Peter

Visit me at CarerFitness.com

P.S. Please tell your friends and colleagues about WEDDLE’s Newsletter. They’ll appreciate your thoughtfulness, and so will we.


Our Featured Books

Get these WEDDLE’s bestsellers today:

  • WEDDLE’s 2009/10 Guide to Employment Sites on the Internet. This Gold Standard of guides to the Web’s 100,000+ job boards and career portals has been completely updated so you can make smart buying decisions for your organization’s online recruitment advertising.

    This edition of the Guide, our 9th, introduces an entirely new format: The Top 100, our pick of the most effective job boards and career portals on the Web, and the Best & the Rest, a directory of over 10,000 sites organized by career field, industry and geographic focus. And at just $39.95, it’s a true recession buster, as well!

  • WEDDLE’s 2009/10 Guide to Association Web Sites. The best talent are often members of their local, state, regional or national professional associations. This Guide enables you to determine which of those associations have the recruiting resources you need to connect with their members.

    The Association Guide lists over 3,000 associations by the career field, industry or location in which they specialize and indicates whether they have a job database, a resume database and/or a discussion area for professional networking. It is the only book of its kind in print and at just $49.95, it’s practically a steal.

  • How can you get these amazing resources? Click here to reach our online bookstore or call 203.964.1888 to order your copies of these truly unique recruiting guides.

    And don’t wait. Even if you’re not hiring at the moment, these books can be helpful to you. Their site profiles will enable you to pinpoint the best places online for recruiting, once the economy starts growing again. And if that takes longer to happen than you would like, these books also include useful information for a job search. So, don’t delay; get your WEDDLE’s Guides today!


    WEDDLE’s News You Can Use

    Even Super Search Strings Won’t Work With the Wrong Keywords

    How can you tell search engines and computers what kind of candidate you’re looking for? Use Finding Needles in a Haystack. Just released by WEDDLE’s, it’s the first comprehensive listing of keywords for successfully searching resume databases online and off.

    The book provides tens of thousands of search terms and phrases for the:

  • engineering,
  • finance,
  • healthcare,
  • human resources,
  • sales & marketing,
  • technology,
  • and other fields.
  • If you’re not getting the yield you need from job board resume databases, data mining or even your own resume management system, this is the reference book for you. In fact, sourcing guru Shally Steckerl described this book as “A rare and uniquely useful reference guide for recruiters!” It doesn’t get any better than that!

    To order your copy, please call WEDDLE’s at 203.964.1888 or click here. Get Finding Needles in a Haystack today!

    Recruiters have careers too, so take care of yours!

    Recruiters are being laid off in record numbers. Whether you’re already in transition ore fear you might be soon, you need a game plan to protect yourself. That’s what Work Strong: Your Personal Career Fitness System is all about. It not only tells you what to do for career success, but when, where and how to do it.

    What’s special about this book?

  • It introduces the Career Fitness System-a revolutionary philosophy of work and a regimen of daily, weekly and monthly activities that empower you to apply that philosophy to your career.
  • Using physical fitness as a metaphor, it presents an approach to career self-management that is appropriate for everyone from senior executives and seasoned professionals to recent graduates and those who are reentering the workforce after an extended absence.
  • In today’s world of work, you have only two choices: you can be the master of your career or you can be its victim. Get the tools you need to take charge of the one-third or more of your life you spend at work. Get Work Strong today! You’ll increase the paycheck and the satisfaction you bring home from work!

    And, don’t forget about others. Get Work Strong for yourself and for your spouse, your sons or daughters and even for your mother and father. Everyone deserves to Work Strong.

    To place your order, call WEDDLE’s at 203.964.1888 or click here. Don’t delay. Get Work Strong right away!


    Our Featured Job Board

    Site Spotlite … from the pages of WEDDLE’s 2009/10 Guide to Employment Sites on the Internet.

    There are 50,000 job boards now in operation in North America and an equal number operating elsewhere around the world. The key to recruiting top talent online, therefore, is knowing where to find and how to select the best sites for each of your requirements. WEDDLE’s 2009/10 Guide profiles The Top 100 employment sites on the Web today and provides The Best & the Rest, a listing of over 10,000 such sites worldwide. It’s all of the information you need to determine which job boards will deliver the optimum yield for you. For example:

    Beyond.com

    http://www.beyond.com

    Post full time jobs: Yes

    Post part time, contract or consulting jobs: Yes-Part time

    Distribution of jobs: National-USA

    Fee to post a job: $301-350/posting

    Posting period: 60 days

    Can posting be linked to your site: Yes

    Resume database: Yes

    Number of resumes: 4,700,000+

    Source of resumes: Direct from individuals

    Top occupations among visitors: Administrative, Customer Service, Finance & Accounting, Information Systems/Technology

    Other services for employers: Assessment instruments, Automated resume agent, Banner advertising, Status Reports: postings & banners

    Member, International Association of Employment Web Sites: Yes


    Books for Your Success!

    Get these WEDDLE’s bestsellers today:

  • WEDDLE’s 2009/10 Guide to Employment Sites on the Internet. This Gold Standard of guides to the Web’s 100,000+ job boards and career portals has been completely updated so you can make smart buying decisions for your organization’s online recruitment advertising.

    This edition of the Guide, our 9th, introduces an entirely new format: The Top 100, our pick of the most effective job boards and career portals on the Web, and the Best & the Rest, a directory of over 10,000 sites organized by career field, industry and geographic focus. And at just $39.95, it’s a true recession buster, as well!

  • WEDDLE’s 2009/10 Guide to Association Web Sites. The best talent are often members of their local, state, regional or national professional associations. This Guide enables you to determine which of those associations have the recruiting resources you need to connect with their members.

    The Association Guide lists over 3,000 associations by the career field, industry or location in which they specialize and indicates whether they have a job database, a resume database and/or a discussion area for professional networking. It is the only book of its kind in print and at just $49.95, it’s practically a steal.

  • How can you get these amazing resources? Click here to reach our online bookstore or call 203.964.1888 to order your copies of these truly unique recruiting guides.

    And don’t wait. Even if you’re not hiring at the moment, these books can be helpful to you. Their site profiles will enable you to pinpoint the best places online for recruiting, once the economy starts growing again. And if that takes longer to happen than you would like, these books also include useful information for a job search. So, don’t delay; get your WEDDLE’s Guides today!