In major league baseball, a hitter who fails seven out of ten times will become a multi-millionaire and oftentimes make the Hall of Fame. Unfortunately, in IT staff augmentation fill ratios are rarely measured as closely as MLB batting averages, and when measured, are typically done so sporadically and inconsistently. Furthermore, over the last 20 years, staff augmentation fill ratios have been on a downward trend. Unlike VMS tools and MSP providers, individual staffing firms typically spend much less time evaluating their actual fill ratios and in most cases don’t even know what their real percentage is. I suggest companies develop a consistent formula to measure fill ratios. I like to keep things rather simply, so I recommend that the moment a recruiter begins working on job order, that particular order will be measured as either filled or unfilled. You should also separate your contract orders from your direct hire orders. Contract to hire business can either go into your contract bucket or measured separately.
There are several reasons why fill ratios for both contract staffing and contingent direct hire are low. These include but are not limited to unrealistic rates, lack of client control, lack of candidate control, competition from both traditional competitors and non-traditional competitors, not working with the correct buyer, unrealistic technical expectations, too many other orders on the board, lack of communication between all parties, incomplete job orders and an inconsistent workflow between sales and recruiting.
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With all these obstacles mentioned above, one must wonder what else can be done to improve fill ratios. By far the number one factor that will increase this critical measurement is improving the relationship the sales executive has with the buyer. Simply put, better relationships lead to better client control which leads to greater fill ratios. In a split desk model, many owners and CEO’s tell me that they don’t have a sales problem; they have a fulfillment problem as they have “more orders on the board than they know what to do with.” Unfortunately, as I mentioned in an earlier post, job orders are given out these days like candy on Halloween night. More is not necessarily better.
Using the measurement mentioned above, most firms I come into contact with have fill ratios ranging from 20% to 25% on the contract side and 10% to 12% on the contingent direct hire side. The bottom line is this… what gets measured gets done. Defining and measuring your fill ratios and continuing to stress the importance of the relationship and client control between your sales team and hiring managers will get your team on their way to become 300 hitters or better!
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