How Do Applicant Tracking Systems Work?
Applicant tracking systems (ATSs) are used by many organizations to help with sourcing new hires and managing their progress through the hiring process.
If you’re in charge of recruitment within an organization or as an external consultant, you've no doubt heard of applicant tracking systems (ATS). But, as you're here, perhaps you're not 100% sure how they work.
In this article, we'll take you through how applicant tracking systems work and can help you at each stage of the recruitment process.
Need expert help selecting the right tool?
With one-on-one help, we guide you to your top software options. Narrow down your software search & make a confident choice.
Key takeaways
- Applicant tracking systems help to store candidate information in a central database and ensure their smooth progress through the hiring process
- ATSs help you create your own database of qualified candidates you can nurture over time
- An ATS will make it easier for you to measure and report on key recruiting metrics.
What Is An Applicant Tracking System?
An applicant tracking system (ATS) is a type of recruitment software designed to make the recruitment process more efficient, reduce manual work, and improve the quality of hires by helping companies quickly identify and manage qualified candidates.
Applicant tracking systems work by automating and streamlining various tasks like posting job openings, communicating with candidates, tracking applicants through different stages of the hiring process, and organizing candidate information in a centralized database.
How Do Applicant Tracking Systems Work?
At its core, the ATS is designed to help recruiters manage candidates from initial outreach through to final interview and (hopefully) an accepted offer.
Depending on the application, they can also assist a hiring manager with posting job listings, headhunting, parsing and evaluating candidates, interviewing, and making offers throughout the hiring process.
The core of any applicant tracking software is a database that stores the candidate's details and information about their application e.g. resume, cover letter, and interview feedback.
Hiring teams can then configure the tool to their recruitment process and move candidates along as they progress through each stage. No more tedious spreadsheets!
Automations within the program such as reminders will help ensure that no steps are missed and that nobody “falls through the cracks”.
Other useful features include the ability to send mass email rejections based on certain criteria.
What Are The Key Features Of An Applicant Tracking System?
Like any recruiting software, every ATS provider offers different bells and whistles.
Some, for example, will help you dip into the market and source candidates as well as parse applications.
Others will allow you to automate recruitment processes such as scheduling a candidate interview. Key applicant tracking system features include:
Job posting
Some ATSs enable you to quickly post JDs to your company’s careers pages as well as on a job board and social channels.
The benefits of this *saving oodles of time and consistent job ads* you can see immediately!
Email reach out
Once you've sourced a list of likely candidates, most ATS can help you structure, send, track, and optimize personalized emails as part of the talent acquisition process.
Candidate database
Candidate information, including any interactions with them, is kept on record (although check how long you are legally allowed to keep them for), allowing you to build a candidate database and nurture relationships over time.
Importing resumes
After applicants have started to respond to your job ad, you’ll likely be receiving resumes from many sources.
Some candidates may even take the old-school route and send theirs in the mail or hand you a hard copy.
The best ATS solution will have flexible importing options, from scanning hard copies to ingesting Indeed applications into your database. (Using supplementary resume screening software can also make this process more efficient if you're dealing with large volumes of candidates).
ATS software makes it easy to collate all your applications into one place.
Electronic resumes are quickly imported into the system, hardcopies are turned into digital documents that can be scanned for appropriate keywords and experience metrics, and external website data is transformed into something useful and readable for the end-user.
Parsing resumes
The resume parser feature is great for when you're receiving tons of applications, allowing you to parse hundreds of resumes quickly using pre-selected qualifiers.
An ATS scan also helps when it comes to finding relevant information wherever it is located on the document.
While there are some resume format standards, each one is different. For example, some people list their skills under each job experience while others create a separate heading to list them at the end.
The resume parsing feature pulls out keywords from each resume, regardless of format, and categorizes each job candidate according to who best matches the job description.
Tracking candidates
An ATS system helps the human resources team keep track of who they've contacted, who's at what stage, and when a good follow-up date might be. This helps streamline the hiring process and ensures a great candidate experience.
Data analysis
If your HR team has quotas to meet, the ATS platform should be able to track and report on those too.
You’ll be able to track and report on key recruitment metrics insights such as which sources are most effective and a which stage are the most candidates dropping out?
What Are The Benefits Of Using An ATS?
We cover this more extensively in our article on ATS benefits, but in summary using an ATS can benefit your organization in the following ways:
- Efficiency and time savings: Centralizes data management and streamlines the hiring process.
- Improved candidate experience: Simplifies the application process and automates communications, contributing to a better candidate experience.
- Better organization and collaboration: Standardizes processes and enhances team collaboration.
- Enhanced reporting and analytics: Provides data-driven insights and ensures compliance.
- Scalability: Handles high volumes and customizable workflows.
- Cost reduction: Reduces reliance on recruiters and administrative costs.
- Better candidate quality: Targets job advertising and improves skill matching.
Overall, an ATS streamlines recruitment, improves hiring decisions, and enhances the recruitment strategy.
Do A Lot Of Companies Use ATS Software?
At least 40% of companies currently use an ATS platform. However, this is trending upward as companies globally are focusing on becoming more technologically relevant in the age of the internet, big data, and online ecosystems.
Most large corporations have been using ATSs for a long time, whether it’s an external system or a candidate portal incorporated into their own HR software.
However, happily, there are now options available for small and medium-sized companies to invest in these systems and get the benefits.
That's why we compiled this useful list of the best applicant tracking systems for small businesses.
Need expert help selecting the right Applicant Tracking (ATS) Software?
If you’re struggling to choose the right software, let us help you. Just share your needs in the form below and you’ll get free access to our dedicated software advisors who match and connect you with the best vendors for your needs.
A Better Hiring Experience For Both Sides
ATS software can save you time, and therefore money, by automating a lot of the process for recruiting new employees.
What's more efficient for hiring teams is also efficient for candidates, and ATSs will likely improve the candidate experience and help ensure none fall through the cracks.
For more insights on HR software and best practices, subscribe to the People Managing People newsletter.
