Plus 4 Ready-to-use ROI Formulas
If you’re like most growing companies, your HR tech stack probably doesn’t always get the TLC it deserves. Life’s busy. We get it.
But as the world moves online, getting your HR tech stack exactly right can mean the difference between scaling-up and falling flat.
From getting to know the crucial tools from the nice-to-haves, to calculating your ROI before you commit, there are plenty of solid tactics for creating an HR tech stack that’s actually contributing to the bottom line—even when you’re wearing a million hats and balancing a tight budget. ⚖️
Here’s why it’s important to cut the tech-fluff and consolidate your HR tech:
In other words, a healthy HR tech stack will help you leap ahead of the competition. 💪🏻
But how can you decide which tools to keep or scrap? Which are crucial to your business systems and how do you know? And what are the best questions to ask and formulas to use to understand in real terms whether or not an HR tool is worth it?
In this unmissable ebook, we’ll let you in on the answers to all these questions, drill down on how to cut through the tech-fluff, plus give you the need-to-know formulas to figure out which tools are really worth the investment.
Ready to power-up your HR tech stack? Let’s go!
HR tech stack meaning: A human resource tech stack is a collection of integrated digital tools necessary for acing the HR function. Basically, it’s the digital spine of your business’s recruitment, hiring and people ops, holding your entire talent function together.
Each company has its own unique HR tech stack dependent on the business’s needs—but there are some functions (like payroll and hiring) that every company should have.
Whichever tools you choose, there’s one word to remember above all others: integrate, integrate, integrate. Because if your tools are working in isolation or causing you to switch between a dozen different screens and logins each day, you’re just adding to the workload. 👎🏽
Candidate assessment tools drill down on candidate quality to help you make better hiring decisions, faster. From automatically gathering work samples to pre-designed cognitive ability test templates, candidate assessment tools make finding your next dream hire simple.
Imagine a world where you can get to know a candidate's strengths and weaknesses without wasting time on endless email chains or boring admin.
With a candidate assessment tool that dream can become a reality, getting you to the onboarding stage faster than ever.
But the range of features and functionalities in these tools can vary and it’s easy to overspend. This formula will help you figure out how much time you can really save with the right candidate assessment tool:
SUM of each role’s time-to-fill DIVIDED by number of roles filled in the same period EQUALS average time-to-fill in days.
For example, you made 3 hires last quarter and they took 11, 10 and 9 days to fill.
Your sum is 11 + 10 + 9 = 30 / 3 = 10-day average time-to-fill.
But if you can save a day by using an assessment tool to automatically prep, assess and evaluate your candidates, your sum would look something like this:
Your 3 hires took 10, 9 and 8 days to fill.
Your sum is 10 + 19 + 8 = 27 / 3 = 9-day average time-to-fill.
That’s a time-to-fill reduction of 10%. ✔️
Building a flexible, scalable HR tech stack should be top priority when choosing your tools—and that’s why Criteria Corp is one of our favorites. Designed for peak configurability, this tool can be fully integrated to fit seamlessly into your wider hiring process. What’s not to love?
An Applicant Tracking System (known affectionately as an ATS) is everything you need for a seamless hiring process. From automated pipelines to dedicated candidate pools, a smart ATS is the only way to find top talent every time.
A smart ATS can save you oodles of time and money.
But don’t take our word for it. Check out this simple formula to find out how much time/cost an automated ATS could save you.
First, calculate how much time and money the hiring process is currently costing your company each week.
30 hours per week x $20 per hour = $600 per week (pre-ATS)
Working on the basis that an ATS can reduce your employee’s workload by at least 30%, and (depending on your choice of tool) could cost as little as $37 per week, let’s see what you could save.
Hours spent hiring with an ATS = 20 hours per week
Cost per hour = $20 per hour
Cost of ATS = $37 per week
20 hours x $20 per hour + $37 for ATS = $437 per week (post-ATS)
That’s a huge weekly saving of $163 ($652 per month!) or 440% ROI for just one member of your hiring team using an ATS.
We’re pretty biased on this one, but for some real-deal insights to choosing the best ATS for you, check out this free downloadable checklist: Applicant Tracking System Checklist — Crucial Features of Your Next ATS
Building a diverse workforce is more important than ever, which is why a diversity enhancement solution should 100% be part of your HR tech stack. These smart people management tools are designed to cultivate diversity in the workplace by managing Employee Resource Groups (ERGs), encouraging innovation in Diversity, Equity and Inclusion (DEI), and measuring DEI data.
We all know diversity boosts productivity, but did you know that 70% of US workers would leave a role if it meant they had to tolerate a bad workplace culture?
That’s right, diversity has a direct impact on employee turnover—and the right diversity enhancement solution can make all the difference.
Let’s look at the numbers. There are two main metrics you’ll need to figure out your diversity enhancement solution ROI:
Number of regrettable departures (ND) = number of employees x annual turnover rate %
Average cost of departures (C) = hiring cost + onboarding and training cost + learning and development cost + cost of time with the role unfilled
ND x C = Annual turnover cost
Let's say you're a 100 person company with a 10% annual turnover rate.
ND = 10
You spend $20,000 per person on hiring, $10,000 per person on onboarding and development, and lose $40,000 in average lost productivity due to the time it takes to refill a role.
C = $70,000
Your annual turnover cost would be ~ $700,000 (ND x C).
If you reduce your turnover rate by just 20% with a diversity enhancement tool, you could save around $140,000.
And that’s before you count the hit on overall employee engagement and productivity each time a team member leaves.
Diverst are the self-proclaimed “pioneers of DEI software”. With this tool, you can take your DEI commitments to the next level by creating a resilient approach to your inclusion programs. From Diverst’s unique mentor program to ERG growth tracking features, this tool helps you push beyond diversity and build a truly inclusive culture.
Recruitment doesn’t stop when your new hire walks through the door (or logs on to their first day from home). New hires need to be shown the ropes and made to feel welcome—or they won’t be your employee for long. The right onboarding tool will make that process easy for you and your new hire, with pre-recorded training options, easy file sharing features and customizable branding.
A smart onboarding tool gets straight to the heart of what makes a business succeed: engaged employees.
By starting new hires off on the right foot, you can ensure they’ll be trained and engaged from day zero.
Here’s how that looks in metrics:
Check your company's SEC report (or end-of-year financial report if you're outside the US) for the revenue per employee. Multiply that number by 40% to get an estimated profit margin per hire.
Let's say your revenue per employee is $200,000. With a 40% average profit contribution, each employee brings in approximately $80,000. But employees in the top 25% of engagement bring in at least an extra 25% in profit.
So, where an average employee brings in $80,000 profit, a highly-engaged employee will bring in a minimum of $130,000.
Sapling is an onboarding super-tool. Technically an HR Information System (HRIS), this unmissable piece of technology is designed to streamline all of your HR functions—and makes onboarding a dream.
All HR pros worth their weight know getting your HR tech stack right is key to business resilience and success.
But that’s not the end of the story.
Because it’s only when you get those tools working together that the real fairytale begins (including those unicorn candidates you’ve been crossing your fingers for! 🦄).
Whether you want a diversity enhancement solution, an onboarding tool or a smart ATS (or preferably, all of the above 😉), your HR tech stack’s only worth investing in if you choose tools with the ability to integrate.
And once you’ve got that sorted, the opportunities for growth are endless.