One of my biggest complaints of HR professionals is that they don’t possess the level of business acumen that is required in today’s global business climate. I did some research a couple of years ago where I looked at the HR programs at Ontario’s colleges and universities. What I found was that only a small percentage of them included business course. They were chock full of courses relating to technical HR – e.g. Recruiting, Performance Management, etc… but they sorely lacked business courses. No wonder the HR profession has struggled to connect HR to business outcomes.
We now live in a world dominated and influenced by technology and personalized experiences. From a basic customer perspective, we make buying decisions based on our own personal experiences; associations with brands, products and services. Is Apple really better than Android? It depends on what your experiences are and your overall perception of each brand. The influencing channels, or factors, can be connected to technology (e.g. social media, online forums and groups, news content, customer reviews).
Shifting gears slightly. We do more hiring than ever before — tenure is as short as it’s ever been, and the candidate experience matters more than ever. Many of our candidates are also customers of the organization’s we work for. I can’t over-emphasize how important it is for HR/Recruiting to understand this. Simply put, an awesome candidate experience will result in more successful organizations. Full stop.
The Connection Between Candidate and Customer Experience
The evidence is crystal clear that great candidate experiences have a positive impact on business outcomes. The research is out there and fully supports this notion. IBM recently did some research where only 25% of dissatisfied candidates were likely to become new customers, whereas, for satisfied candidates, that number jumps more than double to 53%.
Looking at a simple example, let’s say you put 2,000 candidates through the recruitment process at your organization. If this group received a great candidate experience you are looking at approximately 1,060 new customers. If these 2,000 candidates received poor experiences then the potential increase in your customer base is approximately 500. Now, let’s say you’re a Canadian software company where every new customer is worth on average, $5,000 per year. Doing the simple math the 1,060 new customer equates to approximately $5.3 million in revenue, and for the poor candidate experience, the new revenue equals approximately $2.5 million. That’s a $2.8 million difference. That’s HUGE.
I fully understand that this is a very simple example, but the point I am making is that if HR/Recruiting focuses on providing an amazing candidate experience, regardless of whether or not these candidates are successful in landing a job with them, they will positively contribute to the company’s business results. This is how HR can strategically connect what they do to the business. Further, for the additional potential $2.8 million gain it certainly does NOT cost HR this amount of money to provide an awesome candidate experience. No possible way. So, simply focusing on this is really REALLY smart business.
Making it Personal
As an HR Leader, I have been on both sides of the table many times — both as candidate and Recruiter. As a candidate, if I’m treated fairly and with respect, I will always have a positive association with the organization. Always. If my experience was anything but positive my perception of that organization from the lens of a customer won’t be great. Is that fair? Well… I view the organization in a holistic sense. It doesn’t matter where my touch point is. It could be with HR, Marketing, Sales, Customer Service, whatever… it’s all the same to me. And this way of thinking is the same for the majority of the population today.
It’s a very simple message. For all of my HR/Recruiting peers, if you want to be relevant from a business sense, make sure you provide an outstanding candidate experience for everyone. Your CFO and CEO will thank you for it, and you will have the results to show for it.