Recruiting talent is seeing a new high as organizations are spending a lot to attract the right talent. Industry experts suggest possible cost savings methods.
Organizations are using a host of innovative and at the same time run-of-the-mill methods to hire employees. But in order to be effective and innovative, the compromise has been settled on the high cots. The hiring costs have shot up manifold and companies have started to pinch pockets. Experts say that the average recruitment cost per employee can range anywhere between Rs 50,000 to 60 lakhs depending on the positions.
Industries usually hire using a host of methods ranging from internal movements where the company advertises the position within the organization. This method is considered to be very cost effective as the employee is already a cultural fit and the talent stays within the organization. They also advertise in the mainstream press though it is usually expensive as it includes not only the advertising cost but also the cost of processing, screening and interviewing the candidates.
Many organizations have on-campus and off campus interviews for hiring fresh graduates or post graduates of professional courses. They also use an optimum channel mix strategy for hiring experienced people. The channels of hiring would include in-house technical recruiters using portals and own network, employee referral program, placement consultants etc.
Recruitment costs are taking up a major part of annual budgets of the organizations and are engaging a lot of resources. Companies are working in the direction of reducing these costs so as to save on the costs and allocate funds towards strategic projects. The best way to minimize recruitment cost is to make sure the minimum. Recruitment agencies possibly are the best firms of cost effective hiring as one can outsource the â€˜headacheâ€™ to a specialist firm and only pay on successful completion of the assignment.
Companies are working on reducing the average cost per hire by relying on employee referrals, innovative recruiting mechanisms, and reducing the reliance on head-hunters the average cost per hire is approximately Rs30,000 to 40,000. To recruit the best talent along with a faster turnaround time, some organizations have created a pipeline for all critical positions and the mapping has been done for all such positions, which impact business. Since they maintain a three candidate ratio for each position, they have a good database already in the system. These initiatives automatically reduce cost.
Companies have devised action plans which suit their needs best and at the same time cut the recruitment costs without compromising on the quality. Many multinational organizations have subscribed to job portals. Most of the recruitment at junior and middle management levels are done though these job portals resulting in reduction in cost and increase in the process speed.
Most of the recruitments at senior levels are done through contacts. They also recruit through employee referral scheme, which helps them in getting the right person for the right job at a very nominal cost spent on recruiting.
Internal referral is the most effective and cheapest mode of recruitment. Companies encourage their employees to refer people for different positions. It ensures that they attract the best talent and also gives an empowering signal to employees about their engagement within the country.
For many organizations employee referrals are the cheapest modes of recruitment. One of the most cost effective modes of recruitment is the daily walk-in interviews that most firms conduct at their offices. This way, they are able to capture the profiles of a significant number of potential candidates that help in recruitment process. Walk-ins are undoubtedly the best and inexpensive mode of hiring and it has proved effective in volume hiring.
Organizations are saving on the high recruitment bills but at the same time are not ready to comprise on talent. The outcome is the development of a few innovative and cost effective recruitment models.