How to Talk About Employer Branding to the C-suite?

Hello HR person, marketeer or recruiter reading this blog post! 

You probably found your way here because you need some excellent reasons for why employer branding matters. You already believe in it, but maybe your C-suite doesn’t see the value yet? Or if your leadership is already convinced about the importance of employer branding, but you find it hard to get the right investment for your employer branding efforts, this post is for you! 

So, let’s talk money.

A common argument against having a separate employer branding budget to begin with is that “we are already using tons of money for recruitment functions or for headhunting services”. So how to get your C-level onboard to believe that employer branding is not an extra cost, but actually reduces these costs

Well, let’s get started! In organizations where talent is hard to reach or hard to attract, one often has to use a lot of external help to get candidates into the recruitment pipeline. Another solution is to grow the internal recruitment function to do headhunting. But what does all of this cost and how would the situation change if you actually had a working employer branding strategy that would bring in candidates? 

Let’s compare two different scenarios: one where you receive a great amount of inbound applications, and one where you primarily need to headhunt all candidates in your recruitment pipeline.

Scenario A “Tons of great inbound applications”

To fill one role this is how much time and money it requires…

💡 Preparation for the recruitment (kick-off, job ads etc.) – on average 5 hours
💡 Screening for example 100 applications à 5 minutes/application – 8,5 hours
💡 5 phone screenings with the best applicants à 30 minutes/candidate – 2,5 hours
💡 2 rounds of interviews with the best 5 candidates à 1 hour/interview/candidate – 10 hours
💡 Follow-ups after interviews à 1 hour/candidate – 5 hours
💡 Decisions and negotiations and final admin – 5 hours

⏱ Altogether all of this takes 35,8 hours

Scenario B: “We need to headhunt all candidates”

💡 Preparation for the recruitment (kick-off, job ads etc.) – on average 5 hours
💡 Identify 100 candidates for the role – 5-10 hours, average 7,5 hours
💡 Contact all candidates with a personalized message 15 minutes/candidate – 25 hours
💡 Answer all candidates who replied (average 60%) à 5 minutes/candidate – 5 hours
💡 5 phone screenings with the best applicants à 30 minutes/candidate – 2,5 hours
💡 2 rounds of interviews with the best 5 candidates à 1 hour/interview/candidate – 10 hours
💡 Follow-ups after interviews à 1 hour/candidate – 5 hours
💡 Decisions and negotiations and final admin – 5 hours 

⏱ Altogether all of this takes 65 hours

So on average one headhunted candidate requires 30 hours more. And this is a modest estimation that everything goes okay and there are no complications with the case! 

How much money is this?

If an average recruiter’s total salary cost would be 7,500e/month, their hourly wage would be around 50e/hour. So your in-house recruitment cost would be around 1,900e/applied candidate and 3,250e/headhunted candidate. 

A recruiter uses, on average, about 70% of their time for recruitment. So, in a month’s time a recruiter uses 105 hours for recruitment, which in scenario A means around 3 recruitments per month. If they work around 11 months per year, they will finalize 33 recruitments per year. 

At the same time a recruiter in scenario B can finalize 1,6 recruitments per month, and in a year’s time they have finalized almost 18 recruitments. 

So, if a company in scenario B wants to recruit as many people as the company in scenario A, they would need a second full-time recruiter to manage these recruitments. 

In scenario A, with a lot of applications, the salary costs would be 90,000e/year (plus whatever bonuses or extra legislation you have) and in scenario B they would be 180,000e per year. But what happens if you scale up even more? 

If you suddenly need to recruit 100 people, you end up spending 270,000e in scenario A, and in scenario B you spend 540,000e. And, if you happen to use a lot of outsourcing in your organization, the costs can get dramatically higher. Outsourced recruiter fees can often be anywhere between 8,000-15,000e per recruited candidate. So outsourcing half of your roles you end up spending 50 x 11,500e plus half of 540,000e, which totals 845,000e. That’s a lot of money, my friend. 

Now, it is worth asking, which scenario would you choose? 

💡 Need a partner to kickstart your company’s tech employer branding? Our niche is understanding the IT talent market and how tech companies can best attract them. Drop us a line and let’s see how we can help you: petra@findersseekers.io.

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