Building a Better ATS? Part 2

This the second part in my article series on the limitations of applicant tracking systems. Part 1 provided a global perspective on some of the major issues impacting ATSs. Here in Part 2, I’ll focus specifically on some of the current limitations in the way applicant tracking systems are handling key areas of the hiring and talent management process. Identification of Talent Needs In order to accurately identify recruiting and talent needs, an organization must:

  • Determine the talent and skills it needs to meet its corporate objectives
  • Conduct manpower planning (that is, convert skills required into hiring goals)
  • Decide who needs to be hired when

Currently, there is little or no support for the first two items among any ATS. Vendors assume that client organizations have a full understanding of their manpower needs. No vendor I am aware of incorporates any capabilities to support the adjustment of staffing goals as skills are either acquired or lost. Some ATS products do support the import of staffing goals from third-party systems, but this generally requires the use of middleware, as well as special configurations to the ATS (non-standard functionality generally entails added costs). Sourcing Sourcing is perhaps the most fundamental aspect of recruiting. Without sourcing, an ATS is like a car without the proper fuel. It makes no difference whether the car is a Lexus or Chevrolet; it’s not going anywhere without the right fuel. The fact is, no one is getting hired without good sourcing. That means that, in order to be effective, an ATS must be able to:

  • Interface with sources of talent
  • Track source effectiveness

There are a number of problems with most applicant tracking systems in this when it comes to interfacing with talent sources. Interfacing with talent sources is generally limited to job boards. Other sources, such as job fairs or campus placement, usually require manual intervention. Lack of standardization, combined with a limited adoption of XML, ends up limiting intake capabilities. Posting capabilities to any source other than a job board requires the use of third-party services. Even placing an ad in a newspaper is generally not possible without involving an ad agency, though most major papers accept electronic placement and have clear specifications for placement and pricing. As for tracking the effectiveness of sources, this is generally limited to data available to a client in their own recruiting efforts or anecdotal evidence. Where such tracking is not automatic (that is, for all sources other than job boards) data is sparse or non-existent because of a lack of technology to track sources. Another problem is that there is no central database on the effectiveness of particular sources. Given the huge numbers of jobs being placed through any ATS, it would be relatively simple to develop aggregate information on source effectiveness, at least for systems that are available as ASPs. Screening With pressure on HR departments to downsize their staffing functions, there is a big need to improve automated screening. In general, screening ó or at least pre-screening ó is a largely mechanical activity. Ideally, effective screening capabilities allow recruiters to make the most of their time in creative sourcing and in-depth screening of well-qualified candidates, rather than wading through masses of candidates to develop a slate of finalists. For this to happen, an ATS needs to provide support for:

Article Continues Below
  • Assessment
  • Matching job requirements to resumes or profiles

Assessment is, in all fairness, outside the purview of an ATS, given the validation requirements of psychometric instruments. Most ATS vendors support some form of integration with third-party assessment tools. However, the lack of standardization in interfaces and the limited adoption of XML have made the use of third-party assessments needlessly complex. The technology to match job requirements to candidate resumes is readily available, but it’s incorporation into ATS has been slow. Much of the screening that is done is largely based on keyword matches rather than any intrinsic evaluation of candidate skills. While current matching technology is far from perfect, in combination with assessments and some qualifying through targeted questioning it can reduce much of the work recruiters do in pre-screening. Some applicant tracking systems claim to solve this problem by providing powerful search capabilities, including the ability to automatically advance or disposition candidates based on searches. However, this is mostly of value in doing demos. While the technology to support search is robust, its effectiveness is limited to the ability of users to define the appropriate criteria and translate them into meaningful questions and/or search strings. Few recruiters are trained in writing good search queries or care to do so and with candidates increasingly aware of how to write resumes to have them picked up in searches; recruiters are left to reviewing most resumes themselves. Process Administration Process administration ó i.e. the ability of an ATS to support diverse recruiting processes, including requisition management, interview scheduling, tracking activities, and candidate communication ó is the primary strength of most applicant tracking systems. Unfortunately, strength in process administration is hardly something that impresses or excites anyone outside a few people in legal or employee relations departments that deal with OFCCP or EEOC audits. It is difficult to keep a straight face when hearing a claim that a system has strategic value and impacts the bottom line for an organization when its main purpose is to move documents electronically. Also, there is only so much that can be done here to improve recruiting, aside from reducing some of the tedium (and paper cuts) associated with paper shuffling in a pre-ATS world. Client organizations do benefit from seeing more consistency in process administration because of required steps and pre-conditions in process flows. And clearly, an ATS is indispensable in defending an audit. On the other hand, this means that the system is really more of a control mechanism than a productivity enhancer. An ATS reinforces the view that recruiters and hiring managers are not to be trusted to get it right, and would, if left to their own devices, run amok violating hiring processes. To carry this through to its logical conclusion, by leveraging their strengths applicant tracking systems enforce discipline and bring about efficiency in recruitment ó but they do it as an instrument of a “Theory X” mindset. Not exactly material for the marketing brochure. Onboarding Closing out a recruiting effort requires that a new hire be brought onboard. While the definitions and expectations around what that means differ, a certain number of activities must be completed. These include:

  • Verifying credentials (education, licensure, etc.)
  • Verifying employment eligibility
  • Interfacing with payroll/HRIS

There is limited support for verification of credentials. Many ATS products can support interfaces to third-party services for verification of credentials, though the functionality and results are still somewhat sketchy and inconsistent. There is almost no support for verification of employment eligibility. No ATS vendor participated in the INS’s (now in the Dept. of Homeland Security) pilot program for electronic verification of employment eligibility. Interfacing with a payroll system or HRMS generally requires the use of middleware. Despite the fact that it’s a common need, this is far from being standard functionality. ATS vendors are not entirely at fault here, since payroll/HRMS providers, especially the major ERP vendors, have no interest in simplifying or standardizing data exchange. Nonetheless, ATS vendors rarely inform clients that payroll/HRMS integration is a far from seamless process. Certifications from ERP vendors are touted, leading to the implicit assumption on the part of clients that a certified product can be easily integrated with an ERP. Even systems that integrate with payroll/HRMS are incomplete solutions. The data being transferred is limited to what is collected for recruitment. Much of the information needed for getting an employee a paycheck or enrolled in benefits (social security number, deductions, dependents, etc.) is not included. Since an ATS has powerful capacity for intake of candidate data at various points in the hiring process, it would seem that being able to collect the data necessary to complete on-boarding could be readily added. Yet this is generally not supported. Budgeting/Cost Management Recruiting can be expensive, and most organizations need to manage their recruiting budgets. If recruiting is to be considered a strategic function, then it is all the more imperative that recruiting managers demonstrate the ability to manage budgets and provide value that exceeds costs. This is easier said than done, since tracking costs is difficult. Recruiters often do not have access to cost data, or else it is in a form not readily accessible by an ATS. But prior to monitoring a budget, a budget needs to be created. The data to support the creation of a budget (historical trends, time to fill, skills, etc.) is available in an ATS, but no product has the capabilities to support using this data for forecasting and creating a budget. Metrics Lately, much recruiting and HR literature has focused heavily on the need for metrics. This is certainly correct. Tracking key performance indicators (KPIs) is an absolute requirement for monitoring the effectiveness of the recruiting function. While some KPIs can be calculated from the data in an ATS, others KPIs require the use of data from multiple sources. For example, most cost data is available in an ERP, and performance data is only available in an HRMS. Some metrics can only be determined using all three sources. Most ATS products have good reporting capabilities, but typically they rely on users to define their own KPIs. Standard reports are limited to applicant tracking. The inability to effectively interface with other systems (HRMS, payroll) prevents the full range of KPIs related to staffing being available. The problem here is again one caused by a lack of standards and unreliable technology. In conclusion, ATS products address only a small fraction of recruiting needs. The inability of vendors to increase the footprint of their applications is difficult to understand given that there is so much low-hanging fruit. Since customers are paying for third-party applications to fill the void where possible, these are clearly opportunities that can generate a revenue stream. The vendor that starts capitalizing on these opportunities will quickly break away from the pack.

Raghav Singh, director of analytics at Korn Ferry Futurestep, has developed and launched multiple software products and held leadership positions at several major recruiting technology vendors. His career has included work as a consultant on enterprise HR systems and as a recruiting and HRIT leader at several Fortune 500 companies. Opinions expressed here are his own.

Topics

3 Comments on “Building a Better ATS? Part 2

  1. Interesting, shocking and thought-provoking! This is especially disconcerting as we are in the ‘throes’ of selecting a vendor to provide an ATS.
    I am curious if there is a vendor(s) who more closely fits the ‘ideal’ profile alluded to by the author of the article? We are currently ‘courting’ the following vendors: Brass Ring, Deploy Solutions and iCIMS.
    ct

    You can read the original article at:
    http://www.erexchange.com/a/d.asp?cid=774ADF3AB69C413FB991E7B2504C9165

    Post your own Article Review
    http://www.erexchange.com/p/g.asp?d=M&cid=774ADF3AB69C413FB991E7B2504C9165

  2. In hindsight, in my review of the first part of this article my tone was more strident than it should have been; a danger common to bloggers and something that I will try to avoid this time.

    To his credit, Raghav was trying to include many disparate ideas in the piece. I think we both would have benefited from the services of an editor.

    Since these topics are issues that I professionally address, my strong interest in the article leads to some strong opinions- and Raghav has again provided lots of grist for the mill.

    Okay, from the top:

    – I?m not sure that workforce planning and forecasting needs to be an inclusive ATS feature. It certainly is an important part of human capital management, but it remains unproven that ATS systems, even at the enterprise level, are expected (by buyers or vendors) to encompass the entire discipline; certainly many ATS vendors recognize that they are not full HRIS providers and never will be.

    – The results of workforce planning in terms of position requisition flow, talent pool development, recruiting metrics etc. carry financial, legal, and staffing implications that need to be coordinated into an enterprise?s overall strategy function- something often while outside the areas of both the decision-makers and end-users of an ATS product.

    -This points up a need I have spoken of in the past; ATS buyers and Human Capital Managers should begin to think of their data needs just as corporations think of their financial data needs; as a universe of elements to be managed and optimized situation by situation with the expertise of individuals in the area. Every large enterprise has a variety of financial analysts on staff or available, equally they should have human capital analysts or staffing data czars who can handle the streams of data generated by HRIS, ATS, benefits, payroll, taxes, Job Advertising Distribution, performance metrics, workforce and succession planning and other HCM areas. By using budget to pay for these skills, rather than to overpay for ATS and other systems, one would think that much better results would be obtainable.

    And in another sense, any slack time recruiting data analysts may have could be put to good organizational use, rather than sunk capital in unused ATS features, capacities, or services.

    – Skill requirements may change faster than people and systems do at knowledge organizations- too much skill focus can result in misallocation of resources in changing environments and result in organizations that cannot learn fast enough to remain competitive; it’s important to hire people who are skilled; but also people who can obtain new skills rapidly. This matter of assessment is not necessarily a core feature of an ATS; although a quality ATS should be able to integrate externally developed and validated assessments.

    – When Raghav writes that ?some ATS products do support the import of staffing goals from third-party systems, but this generally requires the use of middleware, as well as special configurations to the ATS (non-standard functionality generally entails added costs)? I would say that if organizations budgeted for staffing data analysts, the costs would not be added; they would be expected and fixed.

    – ?Lack of standardization, combined with a limited adoption of XML, ends up limiting intake capabilities. Posting capabilities to any source other than a job board requires the use of third-party services. Even placing an ad in a newspaper is generally not possible without involving an ad agency, though most major papers accept electronic placement and have clear specifications for placement and pricing.?

    This is another passage supporting the use of staffing data analysts, paid for with budget otherwise spent on expensive ATS. (I should mention that HodesIQ is directly wired to the newspapers, as I understand it)

    – I would be interested in more effective source tracking beyond internal recruiting efforts and anecdotal evidence but I?m not sure how that might arise; often I’m not even aware of how a product or service became known to me.

    – I disagree that there is no central database on the effectiveness of particular sources; most good ATS systems provide enough sourcing data to either create the reports required internally or feed OLAP systems that data for effective presentation.

    – ?However, the lack of standardization in interfaces and the limited adoption of XML have made the use of third-party assessments needlessly complex? I agree, and another useful task for your staffing data analyst; something problematic for ATS vendors because of assessment needs change regularly and are highly domain specific.

    – ?Some applicant tracking systems claim to solve this problem by providing powerful search capabilities, including the ability to automatically advance or disposition candidates based on searches. However, this is mostly of value in doing demos? I agree with this one completely. Allowing a computer to perform a critical organizational gatekeeping function seems silly on the face of it. If you could not trust the computer almost every time (and how could you) you would have to check its decision every time (like a clock that randomly gives the wrong time) pretty much negating any benefit. Furthermore, I’m sure some plaintiff?s attorney somewhere would have some ideas about your computer?s inferences and decisions.

    – A quality ATS system will provide search results with some context; where the hit was found, what was found around it, etc. that can help recruiters make faster better decisions about the resumes that they look at; in conjunction with quality prescreens, well-written job descriptions, and well conceived posting campaigns, the quality should improve for the time spent. One of the most useful and impossible to emulate skills of a professional recruiter is the ability to detect the subtle shades and connotations that resumes reveal to them upon a quick scan.

    – There’s a lot more to EEO compliance than pushing documents around; true defensibility must be built into every element of the staffing process. If defensibility is not pervasive, having an ATS can just makes it more convenient for someone to hammer you. Understanding and communicating the Uniform Guidelines to Employee Selection and the precise legal meeting of disparate impact is at least as important as the tool use to track the data.

    -?An ATS reinforces the view that recruiters and hiring managers are not to be trusted to get it right, and would, if left to their own devices, run amok violating hiring processes? I have to disagree with this one; most ATS vendors and organizational managers that I have encountered see recruiters and hiring managers as hard working people whom they want to help by making their lives easier. Occasionally a vendor will sell from the patriarchal or controlling angle, but I don’t think that’s prevalent today.

    – The entire ?Onboarding? and ?Metrics? sections of Raghav?s article again speak to the need for staffing data analysts who work within the organization to manipulate and present recruitment data to and from the various sources and uses of it.

    -?ATS products address only a small fraction of recruiting needs. The inability of vendors to increase the footprint of their applications is difficult to understand given that there is so much low-hanging fruit.?

    From experience, I can advise that the fruit is not hanging all that low. The footprint of the staffing function in modern organizations extends far beyond the people doing the staffing; in other words, beyond the decision-makers and end-users of most ATS products. There’s a difference between ATS system and an integrated Human Capital Management System. The latter is far more expensive, complex, and strategic, although ATS vendors at the top end of the market aspire to provide them.

    – When Raghav writes that ?The vendor that starts capitalizing on these opportunities will quickly break away from the pack? I have to express my doubts; some products and industries are simply too resistant to consolidation for the market to reward a dominant vendor or pair of vendors, and ATS may be one of them.

    I don’t think that any vendor has yet provided an Integrated Human Capital Management System that is best of breed across the board; or even fully competent across the board.

    Peoplesoft, Oracle, SAP, and some larger HRIS players like Ultimate and Great Plains would seem to have the best shot at it; but then again it may be a chimera that such a thing could be provided that would be effective across the kaleidoscope of evolving global business today.

    My suggestion to any enterprise ATS consumer in the current market would be to select one of the four or five (my brand among them) high-quality, low cost, productivity focused ATS systems, and to use the substantial generated budget savings by hiring a staffing data analyst (or two) that will help achieve the results of an Integrated Human Capital Management System.

    By having a person in your organization to interface with your HRIS, Posting, Hiring, forecasting, ATS, and IT resources, you’ll be able to provide the right data to the right people at the right time and in the right format for your specific, unique organizational needs.

    Its unlikely that any ATS vendor could do that faster or cheaper, regardless of the quality of their technology, skill of their people, or amount of their capitalization; it’s an organizational issue that cuts across the formal and informal boundaries of your enterprise.

    You can read the original article at:
    http://www.erexchange.com/a/d.asp?cid=774ADF3AB69C413FB991E7B2504C9165

    Post your own Article Review
    http://www.erexchange.com/p/g.asp?d=M&cid=774ADF3AB69C413FB991E7B2504C9165

  3. In my search today of Applicant Tracking Systems and Resume Parsing Companies etc, I a huge amount of competition – but found no company that is addressing the Mac market. After 20 years on PCs, I switched to the Mac and it has been a great experience – except that the business community seems to ignore us. My latest Leopard 10.5 operating system has Boolean search – which is great, I love the intuitive thinking that Apple puts into their software – but my challenge still remains to find a developer that has parsing technology for Macs. Anyone have any suggestions?

Leave a Comment

Your email address will not be published. Required fields are marked *