The impact of recruiting on employee lifetime value

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4 mins, 33 secs read time

People teams sometimes find it challenging to communicate the value of their work or to be considered true business partners by their executives. That’s why our VP of People & Strategy Maia Josebachvili began writing and speaking on the topic of Employee Lifetime Value (ELTV). In this series, we’ll be sharing how the People team at Greenhouse considers the work that they’re doing in relation to ELTV and share a few tips on how you can think about your own work through this lens.

At Greenhouse, our People department consists of Talent Acquisition, People Operations, Employee Experience, and Talent Management. In this post, Recruiting Manager Jacqui Maguire shares the impact her team’s work can have on ELTV.


What is ELTV?

Greenhouse’s VP of People, Maia Josebachvili, goes in depth in ELTV in her white paper on how to understand the ROI of investing in People. In short, we can use ELTV as a tool to illustrate that investing time and resources at various points in an employee’s lifecycle creates measurable and significant returns for the organization.

The graph below presents ELTV in terms of the employee lifecycle, with time on the X-axis, “output” on the Y-axis, and five points representing a few of the more obvious inflection points in an employee’s lifecycle. When we talk about ELTV, we’re talking about the area under this curve.

Graph of Greenhouse's employee lifecycle


Increasing ELTV through quality of hire

The biggest impact your Recruiting team can have on employee lifetime value, and by extension the business, is through the quality of hires that they make. Through great hires, we move the “How high someone can go” inflection point up.

As a recruiting team, we increase the quality of hire with three key strategies:

  1. Planning
  2. Structure
  3. Transparency


Planning: Start with a strong kick-off

The kick-off is the first step of a structured hiring process. A strong kick-off requires a kick-off document for every role that asks the hiring manager both logistical and probing questions about the expectations of the position and the ideal candidate profile. This is followed up with a kick-off meeting focused on alignment between the recruiter and hiring manager.

The upfront investment results in two great things:

  1. We align on the attributes necessary to accomplish the expectations of the role, and shift focus from arbitrary attributes like “Bachelor’s degree,” to more meaningful attributes, like “Negotiation skills; can navigate difficult conversations towards productive outcomes.”
  2. By shifting away from arbitrary exclusive attributes, the hiring manager is now comfortable with more inclusive candidate backgrounds. This opens our search to find our great hire.


Structure: Build and manage a structured process

Research shows that a structured interview process results in better hires. The three most important parts of our structured hiring process are:

  1. Scorecards: We leverage the attributes defined during kick-off to build scorecards of attributes. These help make sure we’re asking each candidate the same set of questions so that we have a clearer picture of the overall talent pool when it’s time to make a decision.
  2. Purposeful, focused interviews: Each person on the interview team is responsible for assessing a set of attributes. It helps our interviewers know what to ask and what to look for, which ultimately guides hiring teams to the best candidate for the role.
  3. Standardized feedback: Each interviewer submits their feedback on the scorecard in a structured way. This is probably the most important component of structured interviewing because we convert that feedback into usable data.


The recruiting team guides this structured process and acts as a project manager and consultant to our hiring managers. Our diligence pays returns in aligned hiring teams, shorter time-to-offer, and most importantly a higher ceiling for the person we ultimately match to each role.


Transparency: Be open and honest about the role and your company

We make sure candidates know what they are potentially signing up for in the role, the team, and the company. There are good reasons we do this (in addition to it being the right thing to do, of course!):

  1. When a candidate feels they’ve been treated fairly and they have a full and accurate view of the role and the company, they are more excited about the opportunity and therefore more likely to sign the offer.

  2. It ensures a mutually strong fit and a new hire who truly wants the role they’re in.

  3. Transparency helps prevent mis-hires by allowing people to self-select out of the role or company if it’s not what they’re looking for.


Tying it all together

ROI of great people practices graph


Now you have a few tips on how to improve your quality of hire and bring great people into the organization. When you consider this increased quality and output over multiple hires and their employee lifetime, your recruiting team is making a huge long-term impact on the business.

The first step in making this impact is implementing a structured hiring process. You will be able to capture more data and use that data to continuously improve your systems. You will be a better partner to your hiring manager, hire more qualified employees, and increase the cumulative ELTV of your employees.


Want to learn more about the concept of ELTV and how to apply it at your organization? Download a copy of our ELTV eBook by clicking on the button below.

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