By Chris Bongard
19th June 2013

If you use a recruitment agency to hire permanent or contract staff for your business, you may wonder how to assess their performance.  Perhaps you have niggles with their service but aren’t sure if that’s just par for the course or whether they’re not meeting your perfectly reasonable service expectations.  Maybe you are really happy with the service and don’t know how much more you could be getting from your agency?

Sadly, it’s easy to find horror stories about poor recruitment practice.  In the last month alone, I’ve heard of recruiters who pester clients so much that they end up blacklisted – a sure sign of a recruiter so driven by targets that they lost sight of the importance of building a relationship based on trust.  Another HR manager told me about a recruiter who lied that a candidate had successfully completed a skills test before interview, just to get someone in front of her quickly.

So as a hiring manager, how do you appraise the performance of your recruitment agency?  Use our handy questions and prompts below to understand if you’re getting the best service.

The basics

It’s pretty important to make sure that however much you may like your agency, they are delivering on what they’re paid to do.  Are you measuring the following hard and fast numbers?

a)      The number of job roles they successfully filled for you This is the fundamental KPI for any recruiter and you should understand their success or hit rate relative to the difficulty of finding candidates in that area.  The more niche or scarce the skillset required, the harder it may be, so ask whether you have an agency that is good for generalist or specialist roles.  Also consider whether the candidates one agency finds tend to stay with you for long. If they consistently get the cultural fit wrong and you find yourself re-recruiting six months down the line, can you really claim that as a success?

b)      The volume of CVs they send you for a vacancy I’ve yet to meet a hiring manager who appreciates receiving more than five CVs for one role unless a wide variety has specifically been requested.  If you receive an overwhelming number of CVs, ask yourself whether the recruiter is being lazy and not weeding out the less relevant ones, whether they’ve properly understood the brief or whether they think that quantity equals quality.  Also be aware of too few CVs which suggests a lack of specialism.  Be suspicious of receiving candidates with fantastic CVs who then pull out of the process when offered an interview – were they ever genuine or sent to you just to impress?

c)       CV to interview ratio A good indicator of the quality of candidates that an agency presents to you, is the number who you feel are worth interviewing.  Some agencies expect 1 in every 2 CVs to be good enough to interview ie 50% whilst others may go as high as 80%.  If you are only interviewing one out of five candidates, alarm bells should be ringing.

d)      Interview to job offer ratio Again, quality can be measured by how many of the candidates you interview are good enough to warrant a job offer.  A standard metric here would be 1 out of every 2 interviews but consider whether variables in your business would affect that eg a strong employer brand (or lack thereof), salary competitiveness, geographical location etc.

The best agencies will report on these types of metrics for you and it’s important to agree realistic standards at the outset.  If you are using an agency for contract roles, speed to fill vacancy is another useful measurement.

Added value

In their guide “Building and maintaining added value partnerships with HR professionals”, REC and CIPD make the point that recruitment agency/client relationships have long been based on best value but are finally moving to a partnership approach where more added value is provided by agencies.

The extent to which your recruitment agency adds value may be less tangible than the KPIs outlined above but nevertheless, ask yourself the following.

a)      Do you have good lines of communication? Communication is a two way street of course, so let’s assume that you are open with your agency, keep them informed on long term recruitment strategy and provide thorough job specifications for live roles. Does your recruiter stay in touch at the appropriate level for you?  Needless to say, you don’t want to be pestered but neither is it helpful to be silent for months and then all over you like a rash when a vacancy arises. And when you are communicating, do you feel like your recruiter has properly listened, understood and if necessary asked the right questions of you? Is everything done on email or can you reach your account manager easily by phone, after 5.30pm if necessary?

b)      Does the agency demonstrate expertise in your industry or the type of role? A good sign is an agency staffed by people who used to work in the industry, giving them really useful insight into what it’s like to work in that area as well as strong networks. Do they offer insight as to whether your job specification is going to be easy or difficult to recruit for and why? Do they give you advice on salary expectations for that type of role in your industry? Are they up to date with the latest technology, software, skills and demands of the sector?

c)       Do you trust them to act as an extension of your employer brand? Never underestimate how much a candidate’s impression of you as an employer is influenced by the experience they receive via your recruitment agency.  A poor or missing job description, inflexibility or poor communication can all get in the way of a good candidate finding a good role. Check how your agency recruits its candidates, what its standards are in terms of assessing CVs and providing feedback and how well it prepares candidates for interview.  Ask whether you feel the agency understands your organisation’s culture and can relay that to other people.  Have they visited your office, spoken to other employees and even challenged you on your recruitment processes?  Finally, and perhaps most importantly, what targets do their consultants work to and are these aligned with yours?

d)      Do you like them? You don’t tend to find this question in many corporate presentations or KPI reports.  But personal chemistry is important and ultimately, if you are going to outsource a very important part of the HR role, you need to get on well with the person taking on that responsibility. Professional relationships can of course be based on respect but isn’t it easier to communicate openly and transparently with someone you like?

So in summary, to help you appraise your recruitment agency, make sure the basic KPIs are in place including number of vacancies successfully filled, number of CVs sent per role and CV to interview and interview to offer ratios.  Then think about less tangible, added value attributes – good communication, industry expertise, trust that they act as an extension of your employer brand and personal chemistry.

If you can satisfy yourself that your agency performs well in these areas, congratulations, you’re obviously doing the right things. However, if you do think that your niggles are founded, then maybe it’s time to review your supplier list. 

Appraising recruiter

Thoughts on your experiences of measuring agency performance are very welcome.  Please leave a comment below.

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