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Understanding & Measuring the North Star Metrics of Your Recruitment Agency

Strategies based on intuition alone don't work. But only 7% of agencies have sufficient data analytics skills in their teams to truly understand how their agency is operating. By basing your agency's strategic decisions on data, your agency will become more agile, adapt more quickly to market changes, and increase profits faster. 

In this article, we explore how your agency can understand and measure the North Star Metrics for your agency. These are the insights that directly relate to your agency’s growth prospects and they measure the factors that will actually have an impact on your success. These higher-level goals reflect the overall growth aspirations of your agency. 

Being able to clearly understand and measure your agency’s North Star Metrics allows you to have a clear indicator of your progress and situation at all times; and make relevant strategic shifts when needed.

Read on to learn:

How to understand and measure agency data

Which metrics are vital to agency growth

How to put data at the heart of your agency

The first core measure of your agency's success is the revenue generated. But tracking this loosely isn't enough.

Knowing exactly what revenue your agency is generating, where that revenue comes from, and what actions impact this will allow you to strategise for success and make a data-driven growth plan for your agency. 

To measure and track sales performance and the metrics that impact it, consider these three areas:

Measuring Agency Sales Performance

Job-to-Fill Ratio

Client Contribution

Placements Made

53% of high-growth companies rate their sales analytics as essential to their growth

The key to understanding and achieving your agency's North Star Metrics is measurement. By putting data at the heart of your agency and tracking key performance metrics, you will gain a far deeper understanding of performance and how to improve it.

These five key areas should be tracked in real-time within your recruitment CRM to enable you to grow efficiently, effectively and profitably.

What it really means to put 'data at the heart of your recruitment agency'

Understanding Sales Forecasting

Putting data at the heart of your
recruitment agency.

Explore More Agency Leadership Insights

One of the hardest aspects of agency management is understanding your performance in comparison to your competitors. Market fluctuations can impact agency sales and this is particularly challenging if you only become aware of a market shift after it has happened. Without monthly insights into agency performance across your sector, you're missing key data that can guide strategic planning. 

Competitive benchmarking unlocks relevant data on factors that impacts your agency's performance. Make use of competitive benchmarking to measure the following areas and gain a deeper understanding of performance.

Benchmarking Your Recruitment Agency's Performance

Sector Placement Performance

Revenue per Recruiter

Application Sources

Many recruitment agencies are guilty of tracking vanity metrics like the number of calls and emails sent, without taking the time to identify the actual value in recruiter activities. Identifying which actions create results and drive revenue allows your agency to increase efficiency and productivity to scale sustainably.  

Consider the following key metrics to identify the value of activity from each member of your team:

• Job-to-fill ratio: This measurement gives you a strong insight into recruiter productivity. A higher job-to-fill ratio means that they are working efficiently. If this success ratio is low then you should interrogate the type of jobs, quality of opportunities and candidate sources.
• Interview-to-placement ratio: This metric will indicate whether the candidates being put forward by recruiters are up to standard. If companies are rejecting your candidates, you're either dealing with the wrong clients who aren't willing to move forward or candidates who aren't the best quality.
• Prospect breakdown: This metric measures the quality of candidate data that recruiters acquire and add to the CRM, allowing you to work on improving candidate acquisition. 

Identifying Recruiter Value and Returns 

Understanding and Tracking Candidate Sourcing

Having warm talent ready to be placed is not 'nice to have', it's a necessity. ​

Tracking where your applications are coming from will allow you to determine which parts of your marketing strategy work and which don't. These metrics will help you to identify gaps in your sourcing strategy and tailor it to your agency's goals and the market situation. 

Agencies should not only track the source of applications, however. It is also important to interrogate the win-rate per channel. By analysing not only the source of applicants but also the success rate of placing those applicants, agencies can win faster by maximising efficiency. 

Application Source

85% of placements are made with existing candidates.

In order to achieve your agency's growth goals it is vital that you truy understand the output of your agency and the key factors that influence that.

The only way to really understand this is by putting data at the heart of your agency and tracking every factor that impacts sales performance. By measuring and understanding sales performance, forecasting, sector benchmarking, recruiter value, and candidate sourcing, you will be able to make strategic decisions based on data, not intuition.