Applicant Tracking System, or ATS, are programs that automate and optimize much of a recruiter’s hiring processes.
They are much like CRMs only for recruiting, and they have infiltrated the entire recruiting process. They save recruiters and hiring managers from an impossible mound of applications to manually go through and streamline the entire hiring process, even onboarding.
But you may be wondering:
- How long did the online applicant tracking system software has been around for
- What recruiters did before they had them
- How to choose the right online applicant tracking system
- Pricing options for ATS
We’re going to answer all that and more below.
Before any ATS was created, recruiters and hiring personnel relied on paper resumes, phones, and non-computer-based ads such as bulletin boards, classified ads, and signs.
Sourcing and networking relied on word-of-mouth and a pretty small number of people who saw your advertisements or who you spotted somewhere locally. Also, applicant information was only as safe as you could keep your physical documents.
The first applicant tracking systems were created in the early 1970s. There was computer use, but not widespread internet use, so these systems were limited to the computer and did little more than store resumes in an easy-to-find-and-read format on a physical network.
Jobs were still posted on bulletin boards, run in classified sections, and shared by word-of-mouth and signs outside the buildings. Recruiters would reach out to candidates by phone. These early applicant tracking systems did perform two of the vital functions we expect today:
- they made handling resumes more efficient
- and helped eliminate liability issues.
Eventually, one could scan paper resumes to be entered into the ATS, cross-reference candidates, and track the employees’ steps through the hiring process. These early systems were incredibly complicated to use.
It was a skill people had to build, rather than a simple, user-friendly interface as we expect in today’s software. Despite the difficulty, companies already recognized the benefits of ATS and, by 1994, even medium-sized businesses were using them.
The following is an excerpt from a 1997 essay:
“Smaller companies are also using the software. The Association of Human Resource Systems Professionals, in a 1994 study of nearly 400 companies, found that 4 out of 10 companies with fewer than 1,000 workers were using a free online applicant tracking system to keep tabs on people who apply for employment.” (Kennedy & Morrow, 1995, p. 11)
ATS systems began to take on more of their modern-day features in the mid to late 1990s when the internet broke out in all its glory. In fact, many consider this the true beginning of ATS. Recruiters could advertise jobs online, candidates could apply online, and resumes could be immediately parsed and uploaded into the ATS.
With online job advertisements came a wider reach, meaning more people saw each job opening. It was also easier to apply to these jobs, meaning more people who saw the opening applied to it. The desire for ATS systems exploded.
Because of internet connections, ATS systems could be shared within companies with much greater ease, allowing for more streamlined hiring efforts across multiple locations. This is the age of the On-Premise Applicant Tracking Systems.
With new and improved ATS systems, recruiters could manage and track instant email communications with candidates, immediately reject candidates by email, post job opportunities to multiple online job boards at once, and more.
As wonderful as all of these new opportunities were, they were not perfect, and ATS couldn’t rest on their laurels.
Job candidates had long distrusted ATS systems, and the more prominent ATS became, the stronger the feeling grew.
- could simply not “see” a candidate if their resume wasn’t in the right format or didn’t contain the right keywords.
- Would rank them based on keywords in their resume.
- Instantly reject them based on keywords and specific qualifications.
Job candidates have tended to believe their resumes are being unfairly missed or rejected because of this automation. While they have always significantly reduced resume handling time for recruiters, this keyword-based selection could cut into the benefits, even for recruiters and hiring managers.
Between 2005 and 2011, the first batch of SAAS-based ATSes was launched. These systems slowly started proliferating. Some of the On-Premise ATS vendors created online versions. Even in this wave, it was mostly used by large and mid-sized businesses.
In the most recent evolution of the ATS, starting in 2012 with the huge push towards “cloud,” a new breed of Free Online Applicant Tracking Systems like Recruiteze are creating generic solutions for every business.
The businesses are adopting at a rapid pace due to the more affordable pricing and the fact they are not required to lock into multi-year contracts. These systems offer everything a business needs to manage their jobs, candidates, scheduling, and notes in a simple, responsive interface.
Here are some of the features that make your hiring easy and professional:
- Career Portal – These systems offer an easy-to-integrate career portal, which you can plugin into the career page on your website.
- Custom Job Application – Provide you the ability to design custom job applications.
- Candidate Tracking/Management – Ability to store, search and contact candidates efficiently.
- CRM – A basic CRM to manage your contacts.
An online ATS is a software service that is hosted on the Cloud. You need to know and consider some things before choosing the right online applicant tracking system for your business.
The Cloud, in its most basic form, is storing and accessing data over the internet.
The Cloud has the following three components:
- Infrastructure as a Service (IAAS) – This is nothing but renting out servers from one of the Cloud providers like AWS (Amazon Web Services), Microsoft Azure, or one of the hosts of vendors. This means you will pick the server configuration you need and pay annually/monthly for the server. This has radically changed how companies can scale up or scale down their infrastructure based on their needs.
- Platform as a Service (PAAS) – This is a way to rent out a whole platform with the servers. Microsoft Azure started with this option. Now, Amazon has it, and so does Google, along with a host of other vendors. Recruiteze uses Microsoft Azure PAAS for hosting their software.
- Software as a Service (SAAS) – This has become very pervasive as most businesses use at least one Software as a Service. If you are using Quickbooks Online for your small business, you are already using one.
We have other articles coming in this series on various topics to help you subscribe to the right online applicant tracking system.
Here are the most important items to consider before choosing an online ATS vendor, other than the features and pricing:
- Security – Security is essential. Ask the vendor how they are going to ensure the security of your data. As we explained above, once you use a SAAS product, your data is on the servers and database hosted by the vendor.
- Where they are hosting the software – This makes a big difference if it is one of the reputed Cloud Vendors like Azure, AWS, Google Compute Engine, or IBM. They have a reputation to keep, and they have a host of security experts always working to thwart any hackers. They are current with most hacking attempts and constantly working on closing any holes in the firewalls and servers.
- Application Security – You should be able to access only information and pages that you have access to, and all your data should be accessible only after logging in with a strong password.
- Database Security – This is very important because of the many attacks, such as the Yahoo attack and Target attack, where the hackers stole the email addresses and information of millions of users. If they had proper database security, this could have been prevented. Read this article on how Recruiteze secures the data.
- Secure Sockets Layer (SSL) – Don’t even consider a vendor if their service is not using SSL for encryption. You will know if they have SSL by going to their login page and checking if the URL starts with HTTPS. If it does, then they are using SSL. SSL is critical because all data is encrypted while being transmitted and received across the internet. It avoids spoofing attacks where hackers can be watching the network traffic to read usernames, passwords, and any other critical information of your clients, candidates, and users.
- Responsiveness – Make sure the software has a responsive layout. Being responsive is very important since you should work with your Applicant Tracking System from any device. There are plenty of ATS vendors out there, but most of them have not updated their user interface for modern multi-device use and access. Only a few of them have a good one, with Recruiteze being one of them.
- Ease of Use – Make sure it is easy to navigate and use. An ideal online ATS is one where you can understand and use it with minimal or no help.
- Internet Speed – Make sure the online application works well with your internet speeds. This is a relative scenario. If all applications work slowly on your connection, do not expect any other service to perform any better. Compare this vendor with the other service which you are most comfortable with on your network. If you see them working comparatively at the same level, you can check this off your list.
- Regular Updates – Make sure you subscribe to a service that releases regular updates. You want a service that is regularly fixing issues and releasing new features. This shows that the service provider listens to the customers, addresses their concerns, and values feedback. Most SAAS products evolve only with customer feedback.
- Cancellation – Make sure you can cancel anytime with notice. You should be able to cancel with an agreed-upon notice of either 30 days or 60 days. This is the whole basis of SAAS as it should give you the flexibility not to be locked in even if you do not like the service or cancel due to financial constraints.
- Downgrade – Make sure you can downgrade anytime. Don’t ever sign up for a service where you cannot downgrade. Here is why downgrade is very crucial. You signed up for a service; you like the service, and everything is going fine. A recession hits, and you are not doing the same amount of business and need to reduce costs. You should be able to downgrade to a minimal plan. The other important thing with a downgrade is the vendor should retain all your data. That way, you can always upgrade when you are ready for it, with minimal hassle.
- Scalability – Check if you can add and remove users anytime and pay only for active users. This is another major criterion as you should not pay for users who are not using the system. The service should allow you to add and remove users easily. That way, you can scale up or down easily. Only paying for what you use is a huge aspect of SAAS.
- Knowledge Base – See if they have a detailed knowledge base of help articles. It makes a big difference when you have a knowledge base because you can find answers to questions yourself.
- Browser Compatibility – Always check if the service works in all the browsers that your users use. Everyone has different browser preferences. Ask your users to try out the service in their favorite browser and make sure it works for everyone.
- Data Migration – Ask if you can migrate your data if you have to move to a different vendor. This allows more freedom in your decisions. You may have a need to change vendors for a variety of reasons, and you should always have the flexibility to move your data.
We will have a series of other articles which explain how to choose an online applicant tracking system and the features and factors to look for.
It is important to note that ATS is not the only kind of recruiting software nowadays, even though ATSs and CRMs are the most popular kinds of recruiting software and what people usually mean when using the term.
Give them particular attention when researching recruiting software, unless your main hiring goals fall only the category of one of the more specific types of software, like a social media aggregator or interviewing software.
For instance, if everything else is going pretty well, but you want to optimize your interviews, just get interview software for the time being. You could well need another type in the future, particularly for a growing small business.
Here is a full list of different types of recruiting software:
- Social Media Aggregators
- Resume Spiders
- Resume Formating Tools
Social media aggregators search social media platforms for potential candidates based on the criteria you set. It’ll look for candidates in certain locations, working in appropriate fields, and with particular levels of education, for instance. This saves you tremendous sourcing time and costs. You just open the aggregator and have a list to go through.
Resume spiders are like social media aggregators, except they search many places online for candidate resumes. Both help you find active and passive candidates to choose from who have not thought to apply to your job, or if they’re passive, are not actively looking.
Applicant Tracking Systems, or ATS, optimize the collection of resumes by automatically posting job openings, offering a career portal, automatically uploading and parsing resumes, and matching resumes to the right jobs and managers.
Candidate Relationship Management Systems, or CRMs, store and optimize resumes. They provide advanced searching and matching parameters and can remind you of past candidates for new jobs so you can utilize qualified candidates you already have rather than having to source more. They’ll usually offer advanced workflow options too.
Resume formatting tools automatically format resumes matching designated templates. Many recruiters format resumes to streamline them for easier reading, foster blind hiring, and limit hiring managers’ ability to usurp their role. This software saves time by doing this automatically.
Interviewing software helps business owners schedule and organize the interview process and even hold video interviews. This is important because interviewing is a common area where hiring managers make their hiring process inefficient.
Many people delay purchasing an applicant tracking system because they believe it’s too expensive. They picture corporations when they think of ATS and think their own needs and budgets don’t mesh. But this is a very wrong conclusion that could be costing you a lot of time, money, and productivity. Don’t keep missing out.
An applicant tracking system is not just for corporations and large companies. Vendors make applicant tracking systems specifically to meet the needs of small businesses, including their budgets.
Vendors offer an applicant tracking system for small businesses at prices that are tailored to their unique budgeting needs. Small businesses need more reasonable prices and flexible payment options, and vendors deliver.
The average cost of small business ATS, considering all types, is $45 per month. That’s not scary.
You can also find $10 a month pricing deals and even free deals, depending on your needs.
As an example, we’ll tell you what we, Recruiteze, offer:
- Online Resume Formating System
- Free applicant tracking system package for those:
- That will only have a single person using the software.
- Not handling more than 500 resumes a month.
- That do not need a careers page, candidate workflow, online job applications, or bulk resume uploading.
This is great for a small business that just wants to store their candidates in an easily readable format, search their candidates, make notes on candidates for future reference where they’ll be easily found for review or interviews, and have reporting and analytics for your hiring process.
- $9.95 per month plan for those:
- Who require all the features Recruiteze offers.
- That only have a single user.
- Need unlimited applicant support.
- Do not need more than 1 GB of storage.
This is perfect for small businesses who have only one person hiring and want to utilize our full suite of features, including the game-changing careers page, candidate workflow, and online job applications functions.
- $39.95 per month plan is for those:
- Need all the features the other plans offer.
- Want up to five people to use the software.
- Need up to 5 GB of storage per user.
When you have multiple people with hiring duties and/or need 5 GB of storage, this plan is for you.
- Our resume formatting tool also has a free option for those:
- Who want to format only three resumes a month.
- Who will only have one person using the tool.
- That do not need to create their own custom template.
- That do not need more than two standard templates.
This is great for those wanting to dip their toes in the resume formatting world or who only want to format a resume occasionally.
2 . The $29.95 plan is for those:
- Who handle less than 50 resumes a month.
- Need three people to use the software.
- Need custom templates.
- Need an unlimited amount of templates.
- You can add on more resumes and more users for a fee.
There is also:
- A $112.95 per month plan for those handling around 250 resumes in a month who need around ten users.
- A $211.95 per month plan handling around 500 resumes in a month and need around 20 users.
- A customized enterprise option.
These options let you pick the right price for your business needs.
When selecting recruiting software, it is important to consider the features to ensure they have the ones you must have and that you don’t have to pay for more features than you need.
Avoid ATS that requires a contract. You don’t want to get locked into a specific plan, a specific price, or a particular vendor if you don’t have to. And be aware that you definitely don’t have to.
Vendors like Recruiteze offer monthly plans with the option to upgrade, downgrade and cancel at any time.
This is particularly important for small businesses as their needs may increase or wane frequently, and they have a particular need to keep a flexible budget.
It’s tempting to think about only the cost, to see the dollar signs, and think of what is being spent. But recruiting software is an investment, one that will pay back far more than it costs.
Consider what you are currently spending on hiring. This is a bit complicated because there are so many hiring costs that are not obvious.
You or your hiring manager have to spend time sourcing, attracting, selecting, interviewing, and onboarding candidates. This is valuable time that needs to be spent efficiently so you can strategically hire and have time and energy to spend bettering the business as a whole.
You also have to spend money paying a hiring manager, paying for job ads, and training the candidate, at least. There could well be many more costs like recruitment fees or paying for interviewee transportation.
And what about retention? How long will the candidate work for you? If you haven’t made a good match, which is much more likely when you’re rushed and tired from inefficient hiring processes, the candidate may stay a few days or weeks or may not last the year.
You could easily not make a profit from the investment you made hiring the employee and have to spend more money to hire another one. That hurts!
If your hiring process takes a long time, and most of them do these days, your open position is costing you in productivity. Your crew is working harder to make up for a missing employee or your business simply can’t perform as well because a necessary team member is missing.
With an applicant tracking system, you can save money and make more money by:
- Speeding up your hiring process.
- Saving time to spend on business planning.
- Saving time and headache so you can focus on better hiring.
- Attracting more and better candidates.
- Making a better candidate selection.
- Retaining more candidates.
- Having more productive candidates.
- Enjoying a better business because you could focus more attention on the right things.
ATS is not a cost, it is an investment that will save so much time, energy, and money. Your business will be more productive, and you’ll have achieved it with a more efficient hiring process.
And it really doesn’t cost that much anyway.
You can get free, $10, or $30 and $40 ATS plans, so there are options for almost any business. Just make sure you get one that doesn’t tie you into a contract so you can upgrade, downgrade, and change recruiting software as your needs demand.
ATS are still not perfect. They will need to grow with changes in technology and how businesses and candidates go about the job process.
There is an opportunity to evolve using newer technologies as they become mature and affordable.
With our online applicant tracking system, you can easily manage your job requisitions, applications, notes, communication, and scheduling. Recruiteze offers the most intuitive and simple interface to manage your hiring process. It is primarily built for small to medium-sized businesses who do not want to pay through the nose for an efficient online ATS. Recruiteze is available from anywhere you have a browser and internet connection from your computer, tablet, or smartphone. Try Recruiteze free today!