Big goals, bigger data.
- This June, DigitalOcean set aggressive, company-wide goals for the rest of the year. The People team knew there was more to deliver than they had people to build.
- By leveraging their data on Shape, a people analytics platform, the team built a Recruiting Capacity model that surfaced crucial insights to achieve the company’s goals.
- DigitalOcean reallocated resources, made critical hires, and structured their efforts with confidence — knowing that their decisions were backed by data, and aligned with the company’s objectives.
Setting aggressive goals is easy. Building and executing a plan to achieve them is not. Thankfully, the team at DigitalOcean have more than intuition on their side.
DigitalOcean put data at the core of their process years ago, resulting in valuable information stored across their recruiting, HRIS, culture surveys, performance tools, and more. The team uses Shape, a people analytics platform, to bring together these disparate data sources and surface valuable insights.
“Shape empowers our people team with the data-driven insights they need to make decisions”
— Matt Hoffman, VP of People
Insight turned to action when, in June, DigitalOcean set bold goals for the rest of the year. Development needed to accelerate across the organization to meet these challenges, and requests for new hires started piling up.
Setting Priorities
The People team was tasked with triaging these requests, and making a plan to address them. As the wish list for new team members approached 200 roles (the company was just over 300 employees at the time), they knew that priorities needed to be made if the recruiters, and the company as a whole, were to succeed.
Drew Hendrickson, DigitalOcean’s People Operations Manager, started by calling for a prioritized list of requests from each manager. This required teams to thoughtfully rank their needs, and highlight which roles were critical to meeting the year’s goals.
Forecasting the Effort
Armed with this prioritized list of roles, Drew turned to Shape to forecast the resources needed to fill them. He understood that not only was every role different in the time it would take to fill, but so was every recruiter’s ability to make a hire happen. Incorporating both variables would be required for accurate talent planning.
What is our team’s Recruiting Capacity?
The first step was to understand DigitalOcean’s existing ability to bring in talent, which can be defined as the team’s Recruiting Capacity. This metric would help the team understand whether they could meet the recruiting demands of the company over the next six months.
Recruiting Capacity: A team or individual’s ability to make new hires.
To understand how DigitalOcean evaluated their Recruiting Capacity, consider the following data from a theoretical company, “Acme”.
This table shows three roles at Acme, the average time to start (number of days between posting a job and a new hire starting the job¹), and the average number of hires the team’s two recruiters, John and Alexa, make per six month period.² DigitalOcean used Shape to quickly generate a similar table, though much larger, using their own data.
The data reveals that that hiring a Software Developer takes Acme twice as long as hiring an Account Executive (100 days vs. 50 days). Since the time to start for a role is directly related to the amount of recruiting effort and ability required to make a hire, we can think of Time to Start as the days worth of Recruiting Capacity needed to make a hire. In other words, hiring a Software Developer requires twice as much Recruiting Capacity as hiring an Account Executive.
Using this method, we can calculate the days worth of Recruiting Capacity that each recruiter adds to the team by multiplying the average time to start for a role by the number of hires for that role each recruiter makes over a given time period.³
Applying this formula to Acme’s data results in the following.
The Recruiting Capacity metric shows that although Alexa makes more hires per six month period (8 vs 6), the difficulty associated with John’s hires are substantially higher, resulting in John’s higher Recruiting Capacity (510 vs. 440). This doesn’t necessarily mean John is a better recruiter, but it does give Acme a baseline understanding of their ability to bring in new talent.
All together, Acme’s recruiters have 950 days worth of Recruiting Capacity per six month period (510 + 440). DigitalOcean calculated their existing Recruiting Capacity in a similar fashion.
What Recruiting Capacity do we need to meet the company’s goals?
Using Shape’s predictive Time to Start model, the DigitalOcean’s team was able to generate an expected time to get someone in the door for each role on the prioritized list of requests. The team also harnessed an attrition risk model to estimate the number of backfills that would be required due to people leaving the company.
By multiplying the predicted Time to Start for each role by the number of hires of that type which would be required over the next six months, the team determined the total days worth of Recruiting Capacity needed in order to meet the company’s goals. A simplified version of this analysis for Acme is shown below.
The analysis shows that Acme’s current Recruiting Capacity of 950 is not enough to meet the needs of the company over the next six months, which requires 1540 days worth of Recruiting Capacity. An additional 590 days worth of Capacity are needed (1540 - 950).
As such, Acme must either increase the effectiveness of their existing recruiters, or hire additional recruiters. Assuming John and Alexa are already working hard, the only option is to hire more recruiters!
John and Alexa average 475 days worth of Recruiting Capacity each month (950 / 2). One additional recruiter of the same caliber would only bring the team to 1425 days worth of Recruiting Capacity (950 + 475), which is still below the 1540 needed to meet the team’s goals. As such, prioritizing the hiring of 2 additional recruiters is appropriate. If each new recruiter can add 300 days worth of Recruiting Capacity over the next 6 months, Acme will be on track to meet its hiring goals.⁴
Though Acme’s case is simplified compared to DigitalOcean’s, the outcome was similar. Drew used his talent planning model to recognize a gap between the Recruiting Capacity in the Talent Acquisition team and the needs of the company, and set out to hire more recruiters.
Making a business case for extra recruiting resources was simple. Without additional Recruiting Capacity, the company would not make the critical hires needed to hit their goals.
Telling the story
“When I first told Ben (DigitalOcean’s CEO) about our talent planning model, he couldn’t believe it, he wanted to see it for himself.”
— Drew Hendrickson, People Operations Manager
Communicating insights is just as important as generating them. In the case of DigitalOcean’s talent planning, constant communication was necessary, as managers across the company felt the pressure of new goals and the need for new talent.
The People Team parried requests for updates by building and sharing custom dashboards within Shape. These reports were accessible to managers in real-time, enabling the team to focus on bringing in the best people, and ensuring their happiness and productivity once they arrived.
While other companies might have seen the new hire requests piling up, and rushed to start reviewing resumes, DigitalOcean took calculated, data-driven steps to addressing the challenge at hand. The team doubled their recruiting goal for the second half of the year, and is on pace to hit their target.
What’s next?
DigitalOcean’s aggressive goal setting in June sparked the creation of a talent planning model, but there’s no reason the model can’t be used and improved in real-time going forward. With each decision the company makes, the better the model will understand the team’s Recruiting Capacity and their ability to reach goals.
DigitalOcean plans to gain an even deeper understanding by evaluating additional factors alongside the model. How do sourcers accelerate Time to Start? Is the team hiring too fast? Is the company culture suffering as a result? Correlations between these factors and the time spent in the hiring process, the number of applications and onsites — even potential biases of recruiters— can all be better understood through data.
DigitalOcean sets high goals, and they know that their people determine whether they’ll reach them. By putting data at the core of their process, and putting tools in place to harness that data, DigitalOcean recruits and empowers an amazing team.
[1] Time to start was used by DigitalOcean to accurately reflect the team’s ability to get new hires in the door, while accounting for different leave periods/visas/etc.
[2] A six month period was used because DigitalOcean needed to fulfill the company’s new hiring demands in the remaining half of of the year. Acme’s scenario is simplified compared to DigitalOcean’s, given that DigitalOcean needed talent to be both hired and adding value during the year, rather than simply hired within the remaining six months.
[3] This method is, in part, inspired by the work of Opower. A description of their process can be found here: http://hros.co/blog/2016/2/5/opower-how-we-use-data-to-optimize-our-talent-acquisition-team
[4] Even the addition of two recruiters may not be enough in this case. A more robust analysis would incorporate the recruiting capacity necessary to hire the additional recruiters, the time to onboard them, and the reduced time that these recruiters are active over the next 6 months.
