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ATS vs. CRM Part Two: Where CRM Will Fail

Posted by Colin Kingsbury

Feb 28, 2006 12:42:00 PM

In part one I laid out the case against the ATS: too expensive, too much overhead, and too focused on bureaucracy. I've written about this before in my series on how screening questions drain your talent pool. So I understand the appeal. Heck, I started an ATS company precisely becauseI was so unimpressed by what the rest of the market had to offer.

I also understand the appeal of CRM on a conceptual level. The traditional ATS is designed for a market with a few jobs and a lot of jobseekers. It's like the service counter at your local department of motor vehicles. CRM, on the other hand, is built for sales, where leads are immensely valuable and cultivated over long periods of time. And there's no denying that Salesforce delivers a better user experience than most ATSs.

But I come not to praise CRM, but to bury it. Using CRM for recruiting is not a terrible idea. It would probably work well for a small staffing firm which specializes in no more than 4 or 5 defined categories of candidates. It would probably work well in a corporate setting as a sourcing tool, again for a few categories of people. But using it as a full-blown ATS replacement will prove problematic.

It's not set up to manage requisitions properly. "Show me all the candidates in consideration for this opening" is the type of query that CRM will have a hard time providing. In sales, you don't have leads competing to win a deal. Talent scarcity or no, you are still going to be working with pools of applicants and managing interview and evaluation processes. There's still requisition approvals and diversity reports and interview schedules to worry about.

Sourcing the best candidates is important, but it's not the only part of the process any more than finding leads is the only part of selling. Successful sales managers will tell you that they'd take strong salespeople with weak leads over weak salespeople with Glengarry Leads(NB- typical David Mamet "colorful" dialogue) any day of the week. That's why managing the post-sourcing process is so important, and CRM won't do it out of the box.

So you've got a choice: build it all in CRM, or use an ATS as well. Can you customize and tweak a CRM package to deliver all of this? Probably. But don't kid yourself--it may be just a feature or two now, but in the end you're going to catch yourself developing your very own ATS. If you're lucky you'll end up with a good ATS that costs as much as any commercial package and can be supported by any of the 1-5 people who worked on it, and is dependent on an underlying CRM platform that will change over time. That's if you're lucky. As a vendor I regularly talk with customers who tried the DIY route, and most of them are only too happy to kick the habit.

Using two systems is okay at first, but will get messier over time. In the process of sourcing candidates in your CRM, you will build up large amounts of valuable information that may not make it into your ATS. So, you're going to have to check two systems every time you look at somebody. When you bring a new person on they will need to learn two systems which in all likelihood are fairly different from each other. Integration will either be limited or costly, and often both. Then there's the redundant data entry that will probably go on, which is about the most anti-productive thing possible. Invariably what you end up with is one system where everything really gets done, and one system full of incomplete and incoherent information.

Don't blame the entire ATS industry for your current vendor's bad behavior. If you're going to hold CRM up as the ideal, it bears remembering that in 2001, companies were cancelling projects in the millions and tens of millions as abject failures. And yet today the CRM space is stronger than ever. The ATS space has not undergone the kind of shakeout that hit CRM in 2001-2003, but that doesn't mean that there are no vendors who get it. I'd like to leave my readers with just one thought:
Simplify, simplify, simplify!
There's a temptation to always be buying more expensive tools, to always add more functionality (on paper at least), to "increase your holdings" in terms of software. A lot of what's wrong with ATSs today starts with them trying to be all things to too many people. Don't think that because your last system cost $100k to implement that your next one has to as well. Systems which do less can often do more.

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