What is an ATS and How Can It Help With Recruiting?
Applicant tracking systems are used by hiring teams around the world to help track and manage applicants throughout the hiring process. They help to keep teams organized (particularly when a role has hundreds of applicants) and ultimately can support a speedier time-to-hire.
In this guide, we explore everything you need to know about applicant tracking systems – from what they can do, how they work, and their main benefits.
- Chapter 6: How much do ATS systems cost?
- Chapter 7: What are the main reasons for using an ATS?
- Chapter 8: What are the top features of an applicant tracking system?
- Chapter 9: Why should you be using an applicant tracking system?
- Chapter 10: What are some myths about applicant tracking systems?
What is an applicant tracking system?
An applicant tracking system (better known as an ATS) is a type of recruiting software that primarily collects and stores job applications.
Nowadays, many applicant tracking systems offer functions that go far beyond applicant data storage. The top applicant tracking systems on the market will track applicants’ progression throughout the hiring process and automate traditionally manual functions, such as posting to job boards, sending notifications to candidates (and hiring teams), and filtering applicants based on pre-set criteria.
What can an ATS do?
Many modern ATS platforms assist hiring teams with functions throughout the recruitment process – from an initial job posting to onboarding the selected new hire(s). Here are some of the main things a top ATS can do:
- Post to multiple job boards and the company career pages
- Collect applications from job boards and wherever else the job role is posted
- Store applications and individual applicant data
- Screen/filter applications based on a pre-set job requirement criteria through keyword search and other parameters
- Organize candidates based on their relevant experience and skillset
- Filter and search through the applicant database
- Centralize scores and evaluations from interviews/ skill tests throughout the hiring process
- Automatically advance or disqualify candidates based on pre-set criteria
- Automatically notify candidates at each step of the hiring process
- “Save” candidates for a future role
- Share and store necessary hiring documentation, such as contracts or background checks
How does an applicant tracking system work?
Here are some of the top ways ATS works to create efficiencies throughout the recruitment cycle:
Reading an application to create a searchable candidate profile
When a candidate applies to a role, an ATS captures the uploaded resume and any other additional details provided. It then parses the data so it can understand and organize everything captured – from a candidate’s personal details through to their skill set. The data is added to a template, creating a candidate profile that’s neat and consistent with every other candidate profile. The candidate profiles can be accessed by the recruiters. Recruiters can also use a search and filter function to find candidates that match their inputted criteria.
Reading an application for filtering purposes
Applicant tracking systems make high-volume recruiting easy to manage through search and filtering capabilities. ATSs can be set up to look for specific keywords or phrases that show a candidate is qualified (e.g. if you’re looking for a developer, you may wish to see keywords such as “Java”, “Python” or “full-stack developer” within their resume). The ATS can then search the applications for those keywords, pushing forward those that meet the pre-set criteria.
This eliminates a lot of the initial admin work needed to read each application to determine suitability. Say it takes 10 minutes to read each resume and application properly – if 100 people apply to a role, that’s over 2 full days of work for one person! Moreover, some roles may see 1000s of candidates apply, which would require a full team of reviewers. Applicant tracking systems filter through 100s of applications in a matter of seconds.
Updating candidate profiles based on their progress through the hiring process
Candidate profiles aren’t a static source of information. Once a candidate profile is created, an ATS can continuously update it to include the candidate’s results throughout the hiring process. Recruiters can view evaluations from hiring manager interviews, skills test results, and required certifications, such as background checks, all in one place. Based on each job role, candidates can be sorted by their results to quickly review the top contenders.
Automating workflows and communicating with candidates
Recruiters can set up custom workflows within some applicant tracking systems to move candidates through the hiring process automatically. This can be done by pre-setting rules at each stage – i.e. “if this is the outcome, this happens next”. An applicant can be moved forward to the next step, or removed from the hiring journey based on their outcome. The ATS can then even send communication to the applicants letting them know about their next steps.
The first ATS
The first instance of an ATS was in the late 90s, after the introduction of online job boards a few years earlier (monsterboard.com, later monster.com paved the way for online job searches launching back in 1994).
The first ATSs were very basic, creating a way for recruitment teams to bring a paper-based process online. In the 90s and early 2000s, applicant tracking systems looked very different to the products available today, simply offering a digital solution to organize and centralize candidate information. As time progressed, ATSs became more than a centralized hub of information by helping HR teams to track, manage and engage with applicants throughout the hiring process.
Who uses an ATS?
Applicant tracking systems are an extremely popular tool for optimizing the recruitment process. Nearly 99% of Fortune 500 companies are using an ATS. However, it’s not just enterprise-level companies that benefit from using an ATS. Many small to mid-size companies use an ATS to efficiently manage their hiring.
How much do applicant tracking systems cost?
The cost of an applicant tracking system can range from being free (these generally require a lot of in-house tech support) to costing hundreds of thousands of dollars a year (for enterprise customers with a highly-custom ATS solution).
ATS vendors typically use the following pricing models. Depending on your demand for their service, some may work better for your business needs.
Pay per recruiter
Businesses pay a set fee for each recruiter that will use the platform (typically $60 to $100 per recruiter each month). Good for small teams who hire regularly.
Pay per employee
Price is based on the organization’s size (it can be as low as 20 cents per employee, up to about $7 per employee). Good for larger companies, or companies with more recruiters than average for their size.
Pay per job opening or applicant
Price is set by the number of job openings or applicants received (from a few cents per resume, or between about $5-$20 per job opening). Good for companies that do a lot of hiring consistently each month.
Flat fee (per month or annually)
A one-time flat fee that’s sometimes bundled with another pricing model too. As a business only has one opportunity to recoup costs, this can be the most expensive option.
Free, open source
An open-source software that generally requires in-house programming to set it up. As it’s free, it also doesn’t come with tech support, so this option is only suitable for companies that have a software programming expert to assist.
What are the main reasons for using an ATS?
There are many benefits of using an ATS, but generally, there are a select few reasons why companies initially decide to implement an applicant tracking system within their recruitment process:
Organizing candidates in a centralized database
Ensuring compliance via reporting and data retention
Quickly filtering through high volumes of candidates
Learn how an ATS helps companies stay organized, compliant and efficient by reading about the top features of an applicant tracking system below.
What are the top features of an applicant tracking system?
Every ATS is slightly different – some offer a simple way to track and store applicant data, while others allow you to fully automate specific hiring processes. Here are some of the features you can expect to find in a top applicant tracking system:
One-click job board posting
According to Statista, job boards account for nearly half of all applications (with career sites accounting for 35%). The best applicant tracking systems make it easy to get maximum visibility on your job opening with little manual work. With one click, an ATS can add your latest openings to the biggest job boards (such as Indeed and LinkedIn) and your career page.
A centralized candidate database
Applicant tracking systems were built around improving organization. A centralized database is a core feature, allowing recruiting teams to keep everything candidate-related in one place – from candidate profiles and documentation to recorded interviews, interactions, and evaluations.
Candidate relationship management
There are many occasions when a candidate would make a great hire, but the right role isn’t available for them yet. Within an ATS candidate database, recruiters can flag, filter, and move these candidates into their own workflow, making it easy to maintain communication and revisit their profile at a later date.
Reporting, analytics, and dashboards
An ATS allows teams to create dashboards to get a quick understanding of their applicant pool and overall hiring efforts. Dashboards and, additionally, more in-depth reporting are also beneficial when presenting or implementing a new hiring strategy. An ATS can pull the data directly from the platform, but it can also be used to showcase feedback from candidates or hiring managers, helping to provide insights into their experience.
Here are some of the popular types of reporting that ATSs can assist with:
- Applicant sourcing – the job boards/sources applicants are applying from.
- Referral tracking – if an applicant applied via a referral, this can be flagged to measure the success of a referral program.
- Applicant status reporting – an overview of where each applicant is within a hiring journey.
- Time-to-hire reporting – the amount of time it takes to hire an applicant, on average, and for each position.
- Hiring team reporting – the hiring activities undertaken and the amount of time spent on each activity, on average and for each hiring manager.
- Candidate feedback reporting – based on surveyed candidates, an overview of their experience with your company while applying for a role.
- Custom reporting – data pulled from a custom range of information. For example, specific information based on hiring objectives or candidates’ skill sets.
Career page hosting and building
The top ATSs have the ability to build and host a career page on the company website. A career page allows businesses to house all open positions in one place and can pull information into the ATS whenever an application is filled out. Some applicant tracking systems allow for career pages to be customized, allowing for branding, custom messaging and even videos to be added to the career page to best showcase the brand voice.
Additionally, some recruitment solutions can create custom-built career pages, where web pages are built from scratch entirely for the company. These pages can include more complex features, such as visual maps showing candidates all nearby job roles.
An extension of some applicant tracking systems is an onboarding system. As applicant tracking systems can be used to organize all details about a candidate, it makes sense the system can be used to streamline the transition from candidate to a new hire. An ATS can be used to share resource documents and documentation with the hire before their start date.
According to an SHRM report, the average time-to-hire is 36 days. However, top candidates on the market for far less, with reports suggesting teams only have 10 days before they’re hired. Automation is key to saving time in the hiring process, as well as reducing the resources needed. Workflows can be set up to perform a particular function based on an outcome. An ATS can also send notifications to a candidate, recruiter, or another member of a hiring team based on the workflow function performed.
Here are some examples of workflow functions that can be automated:
- Progressing a candidate based on their test result
- Reminding candidates of an upcoming interview
- Moving unsuccessful candidates into a specified folder (e.g. “saved for future consideration”)
- Notifying hiring teams when a candidate has completed a task
- Reminding hiring managers to evaluate a candidate’s interview
A 2020 study showed that over 60% of job applications were completed on a mobile device. With more candidates using their phones in lieu of a computer, it makes sense to use it as a method of direct communication, too. Some ATSs can send communications via SMS, using an automated workflow to deploy text messages regarding interview reminders and progress notifications.
Integrations with other recruitment software
There are some recruitment platforms that offer ATS as part of an end-to-end solution. However, in instances where another recruitment solution is necessary for hiring, ATSs often have the capability to integrate with them, allowing data to flow seamlessly to-and-from the integration.
Why should you be using an applicant tracking system?
Companies can receive hundreds – or even thousands – of applications. For smaller teams, even ten applications for one role can create a lot of manual work. A streamlined, organized hiring process is really important for both the recruiters and the applicants. Here are some of the top benefits of using an ATS:
More efficient workflow
Reduced admin tasks
Fewer resources required
Better completion rates
Better visibility into talent
Better candidate experience
Streamlined hiring process
What are some myths about applicant tracking systems?
As with any technology, there are some myths that deter teams from making use of a really useful solution. We’ve debunked some of the common myths about applicant tracking systems:
Myth: “An ATS uses AI to determine which applicants should move forward.”
Truth: AI is not advanced enough to fairly determine if an applicant is qualified.
AI is increasingly common in technology, including recruitment solutions. However, AI is not advanced enough to fairly determine if an applicant is qualified for a role. Recruitment solutions that follow best practices, such as VidCruiter, don’t use AI to replace human screening. Some applicant tracking systems can filter candidates based on the presence or absence of pre-set keywords in an application. These keywords are either manually inputted into the system or pulled from a job description, meaning the ATS is simply performing a simple search and filter function.
Myth: “An applicant tracking system is solely built to benefit recruiters.”
Truth: An ATS helps to benefit everyone – from applicants to hiring managers.
ATSs help to create an efficient and organized recruitment journey, and the benefits of this can be felt by everyone involved – from applicants to hiring managers. Applicants are far more likely to have a good experience if the hiring process is smooth, regardless of whether they get the job or not. ATS organizes applicant information in a beneficial way for hiring managers, making it far easier to stay on top of candidates that need interviewing or evaluating.
Myth: “All applicant tracking systems do the same thing.”
Truth: There’s a lot of variety when choosing an ATS.
There’s a lot of variety on the market when choosing an ATS, however, they’re all unique in their own ways. Some applicant tracking systems may be more basic, simply offering a place to store and manage applicant data. Other ATSs can perform endless workflow automations and, in turn, significantly reduce the admin work needed. It’s important to learn the features available and determine the best match based on business needs.
Myth: “Only large, enterprise-level companies can really benefit from an ATS.”
Truth: Companies of all shapes and sizes can benefit from an ATS.
While large businesses are more likely to have more openings and more applicants, smaller businesses may have a far smaller team managing their recruiting efforts. Companies of all shapes and sizes can benefit from an ATS.
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