Articles by Smart Recruit Online

Recruitment Software v HR Software – what’s the difference?

To the untrained eye, these two products look very similar and appear to do the same job, but in truth there is a world of difference between the traditional ATS / HR software that is designed for people management and to support the HR functions in the business and a dedicated recruitment software, that is designed to optimise all outcomes associated with the recruitment of new people.

Both products play an important role within the business and in truth they should both be able to work together, but neither product performs all the functionality of the other. But in order to highlight the differences, this article will focus mostly on the unique capabilities of the dedicated recruitment software and the outcomes that it is able to achieve that its HR counterpart cannot.

How to identify a Recruitment Software from an HR Software

The traditional ATS was designed first and foremost, as a tool to support HR in the management of people and will always provide services that go beyond the offer stage. So look out for facilities and tools that support on-boarding and then also provide the ability to manage core HR functions such as:

– Training and development programmes

– Staff reviews and assessments

– Holidays & sickness

– Disciplinary

– Time sheets, Health & Safety, TUPE etc.

A dedicated recruitment system will not usually provide any functions beyond the on boarding phase and the majority of its features will focus on 3 key areas:

– Talent attraction (Job creation and advert distribution)

– The campaign Management

– Screening and selection

Some traditional ATS systems will also provide these services, which is why it can be confusing, so later in this article I will outline the deficiencies that you need to look out for.

The first thing to consider when trying to distinguish the subtle, but important differences in regards to what you need, is to establish what your core objectives are.

If you set out with a clear objective to improve the efficiency and outcomes associated with the recruitment of staff, then it is quite possible that the traditional HR ATS is going to fall short in many departments and in most cases will actually be counter-productive to a ‘direct hire’ strategy that aims to minimise the use of external 3rd party agency recruiters.

In a recent survey that we conducted with over 100 company Directors and business owners, representing the desires of the business, in regards to their future recruitment strategy, these were the most common objectives that the company said that it aimed to achieve in the next 12-18 months:

1. Improve the quality of people recruited by the business

2. De risk the hiring process, to avoid making costly poor hires that don’t work out

3. Reduce Agency recruitment fees and overall cost per hire

4. Increase the quantity and quality of direct applications

5. Improve or strengthen the corporate brand

6. Improve efficiencies such as time to hire

7. Use technology better to aid talent attraction

Interestingly, when the same question was posed to the HR functions in the business, the 3 most important objectives were:

1. Improve administrative efficiency associated with recruitment

2. Improve time to hire and reduce time spent on recruitment activity

3. Centralise recruitment activity

This is not a direct criticism, but the disconnect between the company and the HR/Recruitment system was identified by the CIPD in their far more substantial survey conducted in 2010 and at a recent trade summit I attended as a guest, I posed the same question to the CEOs of several multinational Hotel and Restaurant chains, who were totally unaware of this issue, despite the fact that the recruitment of staff was by far the most important topic on the agenda.

recruitment technology

It is interesting that there appears to be a growing call for more accountability by the HR functions within the business to demonstrate their effectiveness in the recruitment of and retention of talent and this will ultimately start to change mind-sets and behaviours.

The irony is, that a good recruitment system can satisfy the demands of both stake holders, but I believe that there are a couple of issues that stop this from happening.

Firstly, I genuinely believe that there is not a deep enough level of understanding of what to look for when selecting the best technology solution. This isn’t meant to be patronising and it is sometimes challenging to explain those difficulties succinctly ourselves.

Secondly, the traditional ATS companies are never going to say that their product is inferior to the dedicated recruitment service. In fact, quite the opposite, they are going to go all out to convince you that their system can do everything and more.

Finally, I think that there is a fear of accepting that the best solution for the company is to have separate recruitment and HR software that work alongside each other.

What should you be looking for in a Recruitment system?

Choose a web based service

All the leading recruitment services are now cloud based, so there is no need to install software and involve IT functions. Online services will usually be charged on a per-user or by usage basis too. This makes them far more accessible to SMEs as well as large corps.

Ensure that it can integrated with your HR system

All major HR systems have what is called an API so that information can be easily moved across from the recruitment software and into your HR sofgtware. This is normally actioned by the user at the click of a button at the on-boarding phase. Ensure that your recruiting service can provide this.

Great customer support

The traditional ATS companies tend offer very limited customer support that provides no more than technical assistance when things go wrong. The modern online recruitment service should have dedicated account managers that will not only help you with the technical aspects, but will also help to support you throughout the hiring life-cycle to ensure that you have a great user experience and the best chance of a positive outcome. The account managers should have extensive recruitment knowledge and be able to provide practical recruitment advice around recruitment techniques and best practice at every stage from writing the job adverts and SEO optimisation techniques, through to screening and selection strategy.

Multi posting across all digital media

All online recruiting platforms will provide multi posting to job boards, but what you are looking for ideally is a system that will provide you with an automated selection service so that you are posting your vacancy across all the relevant national, niche and local job boards, social media and local advertising media, all for a single recruitment fee. You don’t have the time to be keeping abreast of all the best advertising channels and your online recruitment service should be doing this for you.

The job posting facility should also offer you the option to customise your posting channels to include your own career page, social media pages and to any 3rd party providers that you wish to use. Most traditional ATS systems will require you to establish your own job distribution channels and that means individual contracts and licenses with each separate job board and a far less effective and more costly advertising strategy that will significantly impede your direct hiring objectives.

job advert

Parsing technology

The advantage of using a cloud based recruitment service is that the latest technology can be built in for all users to take advantage of. The key technology to look out for is Parsing. Parsing software automates large parts of the administrative process, auto populating fields of data and avoiding duplication of effort. It also allows applicant details to be received by email and automatically ‘parsed’ into the recruitment platform. Traditional ATS systems tend to redirect the applicant to a separate career page or to an online application form where they are required to start filling in details. This single factor alone is responsible for losing up to 80% of all direct applications during the process and should be avoided with every last ounce of energy that you have. The golden rule should always be to capture the applicant’s details first and then apply your processes for screening afterwards. Do not let anyone convince you otherwise.

Look for the leading parsing software providers such as Burning Glass or Daxtra (I have yet to see any evidence that any other parsing technology gets anywhere close to the same levels of accuracy). For me Burning Glass is the market leader and provides the ability to accurately place applicants into order of suitability in the dashboard. This is because it uses a highly complex set of algorithms that measures the applicant’s CV against the job description using advanced techniques for keyword matching, Boolean and Semantics.

This service alone can take up to 50% of the administration time out of the recruitment process, allowing the user to go straight to the best candidates, put more time and effort into the strongest applicants.

Because the parsing technology captures every single individual that hits the APPLY button, with zero drop off, the user can subsequently apply a process of nurturing to ensure that all candidates remain interested and motivated in the vacancy. Ultimately the outcomes of this are dramatically improved quantity and quality of applicants to work with.

Talent Pooling

In order for your database of CVs to have any value, it needs to become accessible and the system needs to provide the tools to rapidly match CVs to any new vacancies as they are posted. Most good recruitment systems have an auto match facility that uses the parsing technology to search the database and then provide potential candidates in order of suitability for you, along with the communication tools to invite those candidates to view your latest position.

Screening and due diligence

An online recruitment system that works, will normally help to generate a reasonable selection of potentially suitable applicants. However, before moving to interview, it is best practice to perform some due diligence in order to help avoid wasting time at interview and potentially making a bad hire.

Recent PWC and KPMG surveys determined that 1 in 4 hires constituted a bad hire that could have been avoided by performing some basic due diligence and the average cost to a business for a salary over £30k was in excess of £50k, when recruitment costs, training, loss of business, impact on the team morale and subsequent replacement costs were all taken into consideration.

The 3 key components that you are looking for, to assist you in this process are video profiling technology, behavioural profiling and background checks.

The advantage of performing these additional assessments are also worthy of consideration. If a comprehensive screening process is delivered and communicated effectively, it inspires candidates to believe that the company takes the recruitment of staff seriously and establishes a positive opinion of the business from the outset. By looking at the cultural fit of an individual more, the company will begin to hire against behavioural attributes more and this is proven to dramatically improve staff retention and subsequent commercial output.

The best way to compare the way that recruitment systems work is to request an online demonstration of the service and a trial before making any contractual commitments. If you have enough recruitment activity taking place I suggest that you run at least 5 recruitment campaign trials in order to assess how the system copes with a range of vacancies each with slightly different challenges.

About The Author 

improve hiring metricsMark Stephens has over 20 years of business management experience, across Sales, Marketing, Recruitment and Technology environments. Mark is a serial entrepreneur and is the founder of Smart Recruit Online and The HR & Recruitment Resource Library.

Mark has established a reputation for his passion and enthusiasm over twenty years working in the recruitment industry, both client and agency side. For the last seven years, Mark has been researching the recruitment landscape from both a technology and people perspective. His insights into market trends are often used and quoted across the industry’s leading publications.