Using Lean Six Sigma To Improve a Recruiting Process
Client: A major financial services company’s human resources department
Industry: Insurance
Service: Kaizen Event
Challenge:
A major financial services company was having people trouble. The company wanted to scale and add services without adding more complexity to its human resources department. However, its hiring process had several inefficiencies, including:
- Excessive lead time required to hire new people
- Incorrect focus on hiring system as the cause of delays, inhibiting the staff’s ability to find the real problems and solutions
- Uneven distribution of work among human resources recruiters
Solutions:
Through a four-day Kaizen event, Guidon Performance Solutions helped the client:
- Create more effective work flow solutions, with consistent demand on recruiters
- Streamline the entire hiring process, reducing the number of decision-makers involved in many hires
- Refocus attention away from software issues – which actually represented less than 10 percent of inefficiency – and redirect it to streamlining the hiring process
Results:
Through the event and its findings, Guidon helped the client:
- Uncover more than 70 opportunities for hiring process improvement
- Reduce new-hire lead time from an average of 132 days from initial requisition to hire date to the goal of 54 to 70 days
- Confidence to take the approach into other business areas
Hiring talented employees is essential for financial services companies, especially in competitive and challenging economic environments. However, one major financial services company was experiencing lead times averaging between four and five months between the date of requisitioning a new hire to the date an offer was made to the prospective employee. This left important roles unfilled for months before a new hire came on board for training. At the same time, the human resources team was convinced the problems lay in their software system. Most of the management team believed inefficiencies in hiring were due to lack of system upgrades and features.
Guidon’s experts helped the company assemble a 20-person, cross-functional team of subject matter experts, business process management team members, and two high-performing employees who were not part of the human resources function. The director of human resources was also involved. During a week-long Kaizen event, these diverse viewpoints reviewed the hiring process, from beginning to end. They discovered that less than 10 percent of delays were due to software. Instead, of the 71 improvements that were identified, most were related to the process itself.
While the process of recruiting was straightforward, the team found ways to streamline the work flow and the distribution of work across recruiters. An enthusiastic group, they reviewed every component of the process to determine which steps added value and which didn’t. The biggest obstacle they discovered was a requirement that senior leadership approve all new hires. This led to a 40-day delay in the process. And while it was an effective deterrent to hiring unnecessary employees, it was also a significant impediment to the hiring process overall. By removing that requirement for some hires, especially those at lower levels whose skill sets did not need senior management input, the company could significantly reduce lead time for many new hires.
Other process improvements identified included:
- Create more visual queue boards to keep participants apprised of hiring progress
- Move from having a single recruiter responsible for all hires to an approach where work is spread evenly among recruiters
- Reduce hand-offs and decision-making requirements
While the firm has not implemented all of the 71 improvements, it has made major strides and reduced its hiring time for various positions. Prior to the improvements, the timeline from requisition to hire averaged 132 days (which included 27 days prior to HR recruiter action and 95 days of processing after requisition, as well as other delays) – to within the stated goal of 54 to 70 days. Better communication eliminated many of the delays and roadblocks, including lack of transparency about the process and the status of each new hire. Ultimately, the organization achieved its goal of getting new talent in the door in approximately half the time it used to take, putting new employees to work that much more quickly.
Related Links
Guidon Business Process Management Services
Insurance Industry Solutions
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