Talent Acquisition Optimization Key Metrics

As customer demand accelerates, talent acquisition (TA) and recruiting become critical for technology services businesses. While some teams have well-established TA processes, others can refine their systems, workflows, and performance metrics to drive better business outcomes.

We’ll describe standard and alternative TA metrics to help management teams optimize talent acquisition strategies. Companies should tailor these metrics to align with their specific business objectives.

Time-to-Fill

This key metric can be defined in various ways, such as the duration from when a position is approved to the candidate’s first day on the job.

Activity Index

A system that assigns activity points to TA professionals, providing visibility into individual and team performance. For instance:

• 1 point for candidate outreach
• 2 points for technical interviews
• 4 points for offers extended
• 8 points for accepted offers

Aggregating these points weekly or monthly enables leadership to assess productivity levels effectively.

Skills Coverage Score

To ensure strong candidate alignment with job requirements, companies can develop a scoring model based on desired skills. A full coverage score might total 100 points, with deductions for gaps in experience, technical expertise, or other qualifications—allowing for objective comparisons among candidates.

TA Expense Ratio

This metric evaluates the return on investment in talent acquisition by comparing TA-related expenses to the revenue generated by new hires. For example, TA operating expenses/revenue are attributed to newly hired employees (Assumptions may be required to account for historical TA costs versus future revenue impact).

Conversion Rate

Measuring the transition between stages in the recruiting funnel can help build conversion rates between them, which provide visibility as to efficiency at each stage - e.g., number of offers made / technical interviews, or other conversion metrics. Analyzing conversion rates at different stages of the recruitment funnel provides insights into process efficiency. Examples include: 

• Offers made / number of technical interviews
• Accepted offers / total job applications received

Tracking these and other metrics helps identify areas for improvement within the hiring process.

Elaxtra Advisors is an M&A and value-creation advisory firm that assists institutional investors, private equity-owned platforms, and strategic acquirers invest and create value in worldwide technology services companies. Please contact us to explore potential partnerships.