The ROI of Talent Management: Tying the Intangible to the Tangible

stock-photo-talent-acquisition-or-recruitmentThe human resource function has long been considered to be somewhat “soft” in terms of being able to apply hard data to prove the value of recruitment and retention activities. From the standpoint of HR pros, they simply “know” that treating prospects well, onboarding effectively and taking steps to meet the work/life balance expectations of employees are good things to do.

But the C-suite doesn’t generally respond positively to HR’s exhortations that “we simply must do this because it’s the right thing to do.” They want to understand the return on investment (ROI) of both dollars and time spent on the range of activities that encompass talent management.

Increasingly, the HR profession is understanding how critical it is to speak the language of the C-suite in ways that clearly tie what have historically been “intangible” benefits to tangible ROI metrics. In fact, key findings from The Economist Intelligence Unit’s (EIU) research into workforce analytics indicate that the use of analytics is definitely on the rise.

Why? As stated in the executive summary to the report: “With the acknowledgment that human talent leads to competitive advantage in a knowledge economy, any data analysis that can help organizations to attract, motivate and retain the right people is bound to interest executives.”

What do some of those hard numbers tell us? You may be surprised—and, chances are, so will your C-level executives. Here’s some hard data that can help you help them see the benefits of your talent management activities.


  • Focusing on the cost of recruitment and finding ways to drive out costs can also be a tangible way of conveying value to senior leaders.

Successful Recruiters

But, how can you quantify the bottom-line impacts of your recruitment efforts? In a must-read XpertHR white paper, “Proving the ROI of Talent Management,” Krista Becker, a media and analytics specialist at CKR Interactive, an employee communications and recruitment marketing firm with offices in Los Angeles, San Francisco, San Jose, Chicago, Philadelphia and Cleveland, suggests three metrics that can convey the value of your recruitment efforts:

  1. Cost-per-hire: How much are you spending in time/money to recruit and hire candidates? How are these numbers changing (hopefully declining) on a per-hire basis over time?
  2. Time-to-fill: The more quickly you can fill a vacant position, the greater the positive impact on productivity.
  3. Hiring source: Tracking the value of your various hiring sources can help you identify those that provide the biggest benefit, reducing hiring costs as a result.

Tracking and reporting on these costs regularly, can help you demonstrate not only actual costs, but also areas of improvement, or areas where additional focus is necessary. This is the kind of data that will make senior leaders sit up and take notice when you offer suggestions for ways to boost your company’s brand.

  • Once hired and onboarded, keeping employees engaged to ensure their long tenure is critical. About 1/3 of recruiters report an average employee tenure of only 1-3 years. What keeps employees engaged? According to the 2015 SHRM Employee Job Satisfaction and Engagement Report, two of the things that employees rate as “very important” to their job satisfaction are being treated respectfully and having a trusting relationship with senior management.

Don't Ignore the Intangibles

Measuring the cost of turnover can be accomplished by quantifying the costs of talent replacement (recruitment, onboarding and training) along with the impact on organizational productivity.

Josh Bersin, of Bersin by Deloitte, tells us that using analytics in recruiting and talent management can significantly improve business performance. In an article by XpertHR Legal Editor David Weisenfeld, Bersin shares specific steps that employers can take to not only use analytics, but to ensure that they’re using the data most effectively.

The numbers are proving what HR professionals have known all along—attracting top candidates by offering valued benefits, streamlining the talent recruitment process and onboarding new hires effectively, has big benefits for employees, HR pros and the companies they serve. More and more HR pros are finding ways to convert the intangible to the tangible in meaningful, and measurable, ways.

ROI of Talent Mgt


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