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Firms fail to gauge recruitment value

Many companies are increasing their recruitment expenditure without putting checks in place to ensure that they are getting value for money, according to Cranfield School of Management.

Its latest recruitment confidence index reveals that 84 per cent of companies expect their recruitment expenditure to increase or remain the same over the next six months.

Sixty-six per cent of organisations assess the success of their recruitment process but only around 25 per cent of them work out a cost per hire, which Cranfield says is the true measure of value for money.

The quarterly survey, which interviewed 557 senior managers around the UK, looks at changes in recruitment activity, business conditions, recruitment methods, skills shortages, staff turnover and pay.

Cranfield says it is not surprised by the findings of the survey, which is sponsored by online recruitment specialists Konetic.

It found that companies tend to buy recruitment software and then try to change their internal processes to match the way their new systems work, creating friction within the company.

Konetic recommends setting practical business objectives such as direct cost savings or producing a preferred supplier list of recruitment or executive search agencies.

Cranfield School of Management research fellow Dr Emma Parry says: “These results paint a worrying picture of organisations throwing money at recruitment without any idea if they are receiving a suitable return on their investment.

“This suggests that when recruitment is unsuccessful, recruiters just spend more and more on the same processes rather than systematically assessing the success – or failure – of the methods they are using and making changes accordingly.”


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