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Applicant Tracking Systems | Filling The Hiring Gap – Episode 02

Filling the Hiring Gap is a five part series, presented by Mosaic Human Capital Solutions, a professional services company focused on delivering human resources to client companies. In addition to maintaining an HR consulting book of business, Mosaic Human Capital offers fractional HR services, turnkey startup support, and we are quite effective and active in the talent acquisition and retention space.

The premise of this Lunch and Learn Series is to offer practical guidance to mid-market company leadership on how to fill the gaps we see in talent acquisition practices today. In this episode we will take a deeper dive into covering applicant tracking systems. Henry Martinez, Founder of Mosaic Human Capital and former Senior Vice President of Human Resources for Valero Energy Corporation and CST brands, speaks directly to middle market owners and operators in this series. He wants to make sure that anyone who is not an HR professional, who does not live in technology platforms day-to-day, can gain a little bit of insight into what an applicant tracking system (ATS) is, what the marketplace is, what the dynamics are in the market that drive the need for this type of technology and how they could frame their thoughts around going to market for an ATS.

What is an Applicant Tracking System?

An applicant tracking system, also known as an ATS, is an electronic platform used by companies to manage their internal hiring process. Multiple people can log into it and it’s a way to collaborate and manage the hiring process. These types of systems began to gain popularity in the 90’s when internet based recruiting really started to emerge. Since then it’s taken off and the user interface has improved as well as features like texting and workflow efficiency. At the end of the day it’s just a way for companies to manage their internal processes and become more efficient.

Why is an ATS important? Is an ATS necessary?

Henry Martinez answers this in a multi-fold point of view. An ATS is important, first of all, because the market drives companies to seek this type of technology to keep up. Since labor has a downward trend at a macro level, there are fewer people to go to work. This is why the labor market is so tight and is going to stay that way for a while. The pandemic accelerated this phenomenon, which is why we’re now massively understaffed. An ATS is necessary to ease the pain point that middle market companies have when hiring feels out of control.

The next piece, Henry says, is that companies need to invest in themselves and their brand. When all your competitors use an ATS and candidates go to their website’s Careers page to electronically apply for a position, yet your website’s Careers page has a PDF to print out and send in, you’re going to lose people before they even get to know you. The manual recruiting space has evolved to a digital recruiting space and it’s been trending that way for over a decade now. Case in point, when Henry worked as the Senior VP of HR for CST brands, they were a convenience retailer. In 2011 CST built their own proprietary ATS and even then their data told them 70% of their applicants were applying through their mobile device. This was 10 years ago for an $8.50/hr job! So when you fast forward to now, you have even more people that have grown into the marketplace, expecting an ATS type interaction with a potential employer.

Luke Sesler, Director of Operations at Mosaic Human Capital, agrees with Henry and adds another layer that an ATS is necessary for an ideal candidate experience and inner-office collaboration. In some organizations there’s anywhere from 1-5+ people on the hiring team and being able to keep everyone on the same page is imperative. Similar to a project management system, an applicant tracking system allows your company to see what needs to be done with your candidates and what conversations/notes have already been had. For example, the recruiter reaches out and does a phone screen, then types in their notes on a particular candidate. The other recruiters or hiring managers can go into that candidate’s record and already see exactly how that conversation went and in which stage of the hiring process they are.

This further allows your middle market company to be faster and more efficient in their recruiting. A good applicant tracking system will allow you to customize it based on your defined workflow, whether that’s three, five or twenty steps! You can customize it to the job or make it generalized across the board. From this streamlined workflow comes data that you can use to tweak the process to make it even more efficient. An ATS provides data and reporting that quickly allows you to see things like how long are candidates sitting in one part of the funnel? Are they sitting in the phone screen funnel for too long? If so, why? Data driven conversations will help companies be able to problem solve their hiring gap.

Lastly all this candidate data, being in one central and secure place, gives you candidates to go back to when you have another requisition that’s similar to one previously. For example, you run an HR Manager position and you have 100 applicants. You select one of those but are still left with potentially 99 other qualified applicants. They were interested in working for you at one point so why not leverage that brand awareness when you hire another HR employee? You’ve pulled in all these candidates and have now saved yourself work from having to seek more. An ATS works the other way as well, syndicating your job across other popular third-party job boards like ZipRecruiter, LinkedIn, Craigslist, you name it. It’s about casting a wider net to pull in candidates and then fishing from that same net when you have a new posting to fill.

What’s the best way to go about choosing an applicant tracking system?

At the very core, applicant tracking systems perform the same service and give you the same result, but there are many nuances that can increase the time it takes to set up an ATS in your company. It really depends on what features you need.

First, you’ll want to set up demos with the different companies and our recommendation is doing no more than three to five ATS demos at one time. Otherwise you’ll be doing research until you’re blue in the face and they will all start to blend together in your mind. When doing these demos make sure the right people are on the call, such as hiring managers and people in the middle of the workflow that will be using the system the most.

Second, you want to decide internally how long you need to install the ATS. When we install ATSs for our clients it typically takes 1-3 maybe 4 weeks tops. And that just depends if it’s an ATS standalone enterprise, how complex the organization is and what other factors are going on at the time. It’s not that difficult to set up but you have to look at your employee’s current workload and how much time and energy they have to make it happen.

Third, you need to look at costs. From an affordability standpoint, many of these ATS are very affordable. They are virtually all cloud-based, on a monthly subscription cost. We do not advocate for a certain ATS over another, nor do we share pricing on what we use. If you’d like to reach out to us privately and have a conversation, we’d love to chat. But when you compare the cost of implementing an ATS to the cost of opportunities missed by not being properly staffed, it pays for itself with a few incremental hires. Just because you are a middle market company does not mean you have to purchase an HRIS system. The goal is to move as much as you can away from manual recruiting.

What is the most desired feature of an ATS for middle market companies?

Without a doubt the most desired feature for our middle market clients is the ability to text candidates. Individual texting, bulk texting, all through the ATS and aggregated into the candidates record so all the hiring staff can see the conversation.

When you use the ATS to track conversation flow with candidates via phone, email or text, we always see text have a higher response rate. You can be on your computer and type out texts to multiple candidates faster than if you were to be emailing as well. It’s a win-win all around.

The main message we want to convey in this episode is that talent acquisition is very, very specialized and it always has been. Even more so in this data-centric, tight labor market. We encourage middle market leadership to think of an ATS as an investment and a necessity to get infrastructure in place to do more of your own sourcing. The way these systems are designed nowadays should not be intimidating. If they are, you have third-parties like us that can help you implement them and train your staff on new processes. Hopefully with this further education you do feel less intimidated and more informed!

Our next episode will be on candidate experience and we welcome your thoughts and questions on our YouTube video. Stay well and we look forward to seeing you soon!