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Adopting technology-based recruitment tools simplifies the hiring process

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by Suruchi Pande , Research Analyst, Recruitment - HR Services
16 August 2017


Technology is associated with HR for more than a decade now. Technological advances have simplified tedious time consuming tasks and streamlined them into a single process. Due to technology transformations, many vendors have created new products and services to fulfil the technology demand for hiring process.

Recruitment has evolved with the aid of technology and recruitment tools namely ATS, TAS and TMS have transformed the hiring process. Each segment has high demand and generates high revenues worldwide. Buyers are influenced with best in class services to improvise their business processes.

Most of the HR managers fail to understand the importance of integrated applications for their domain. With many vendors offering their own technology tools, it is essential to understand the detailed analysis of tools. Evaluation of these tools can be performed on the basis of their service offerings, engagement model, cost and cost saving opportunities. This article will help in identifying and evaluating the various tools available in the market for improvising the hiring process. It also recommends key selection criteria and suitable sourcing strategy for companies that face challenges in selecting an appropriate recruitment tool.


Traditional recruitment is a complex process involving a lot of paperwork, office memos, filing and documentation. It consumed more time and resulted in low quality of hire. 

Recruitment tools are used by companies to improvise the hiring process. HR technology has transformed traditional recruitment process involving a large heap of paperwork to automated platforms with clear documentation. Benefits of automated platform include importing and processing resumes, monitoring social media, and providing higher consistency in operations workflow.

Recruitment technology has evolved with a large number of hiring tools available in the market. ATS, TAS and TMS are the three major recruitment tools used by most of the companies.

Applicant Tracking System (ATS) is an electronic based recruitment tool used by companies to recruit employees and includes job posting, searching, screening, and offer management.

Talent Acquisition System (TAS) is a cloud based software service or on-premises tool used in recruiting, acquiring and on-boarding employees. It include activities such as job requisition and posting, planning, searching and screening, interview feedback, offer acceptance, and on-boarding.

Talent Management System (TMS) is an integrated software suite which includes succession planning and analyzes intra-company learning of the employees for recruitment activities.  It includes activities such as planning, sourcing, recruiting, on boarding, performance, succession and development, compensation, and off-boarding.

Supplier Trends

  • Recent trends show that 20 percent of the companies are using cloud-based services for HR, 13 percent of the companies are planning to move to the cloud in the next 3 years, 18 percent plan to use fewer vendors, 26 percent companies see benefits in integrated services, and 23 percent companies do not have a HR analytics team. Companies are expected to streamline their business processes in a single integrated platform delivering HR analytics, and all functions of HR in a single integrated platform. Market growth in cloud segment is increasing rapidly; buyer’s preference is expected to shift towards cloud-based services.
  • Most of the fortune 500 companies prefer major players such as Oracle, SuccessFactors and their homegrown talent management suites. While start-ups or SMB companies approach niche players such as workday, iRecruitment, PeopleFluent and Newton Software. As compared to key players, niche players are expected to increase their market share of the ATS globally.
  • A big technology giant such as Oracle is innovating Taleo, a cloud-based service specifically for a complete HR tool. Taleo based ATS software saw a slump in market share from 58 percent in 2014 to 37 percent of the total ATS market globally in 2016.
  • Another technology giant SAP has developed many software tools such as SuccessFactors for recruitment, compensation and HR analytics. SAP’s ATS segment has an estimated 2 percent market growth from 2014 to 2016.

Current Developments

Revenues generated by ATS vendors are expected to be stagnant till 2016. It is forecasted that these revenues will grow by CAGR of 1-3 percent in 2018. Whereas, revenues generated by TMS vendors are expected to grow by 6 percent in 2016; it is forecasted that these revenues will grow by CAGR of 3-5 percent in 2018.

Increase in demand for Talent Management Suites

Most of the ATS tools do not support HR compliance (includes number of job requisitions, maternity leave benefits and employee exits adhering to the labor laws of that region) and large number of unprocessed applications is observed while using ATS. As there is always a scope for improvement, Vendors evaluated the need for integrated package such as talent management suites which includes health and wellness, HR compliance, multiple source feedbacks, HR analytics and predictive analytics.

Large business organizations are replacing their ATS with Talent Acquisition or talent management suites, whereas, small or medium business firms are opting for ATS tool.

Comparison of Recruitment Tools

ATS, TAS and TMS can be compared on the basis of service offerings, costs involved, pricing and engagement patterns and vendors.

Pricing Models:  For ATS and TAS

Recruitment tools are priced on the basis of subscription models. Subscriptions can be monthly or yearly type. Companies can select the type of subscription model on the basis of their volume of hire required in a year, company may prefer monthly based model if volume of hire is lesser else company selects annual based pricing model.

Subscription based pricing model is applicable for ATS and TAS.

Pricing Models:  For TMS

Unlike ATS or TAS, TMS is service based and not a fixed fee model. Fees will differ for recruitment, performance, learning and development and succession planning. In case, a company has existing performance tool so supplier will charge only for other three tools.

Additional cost would incur if the TMS needs to be integrated and configured with the existing HR tool of the company.

Cost Structure

  • The recruitment tool subscription is provided with two logins (server portal user id), one for administrator user and the other for HR manager.
  • Flexible configuration options are available to match the recruitment tools requirement.
  • No extra costs will be charged for reconfiguration of the tool

Cost Saving Opportunities – For ATS and TAS

  • Selecting annual subscriptions will achieve cost savings of 5-9 percent as compared to the monthly fee
  • Limiting the logins to only one HR manager can reduce the need for extra login which can increase the total cost

Cost Saving Opportunities – For TMS

  • Companies can achieve cost saving by availing only the services based on requirement
  • Customization of the TMS tool with respect to company’s requirement can provide a cost saving of 15 percent.

Key Takeaway

TMS can be the preferred recruitment tool for HR related services, as it gives high level of customization with higher potential for cost saving.


There are many tools available in the market for improvising the hiring process. With TMS market growing tremendously, companies will seek more opportunities for a customized and integrated platform in upcoming years.

Replacing ATS with TMS will result in a strategic sourcing option, due to which companies are expected to leverage their business revenues by 35 percent in future.

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