How to choose the best applicant tracking system for your business

What is an ATS in recruitment?

An applicant tracking system (ATS) is a centralised platform that helps manage job postings, identify candidates that match the job descriptions, as well as sort CVs, track candidate applications, facilitate communication, screen candidates and even monitor the cost per hire.

An ATS is particularly valuable for larger organisations, those with a high volume of applications and those with complex hiring workflows. 

How does ATS software work? 

An applicant tracking system works by helping to automate and streamline recruitment processes and digitise the hiring process to give recruiters, employers and hiring managers more control and visibility.

The right software can help you achieve key recruitment goals – 94% of recruiters said that using an ATS improved their hiring process, and 86% said it reduced time to hire. 

The best applicant tracking systems include the following key features and functionality: 

Job Posting and Management: The top applicant tracking systems will allow hiring managers to create and post jobs on external job boards and the company's careers page. It can help standardise job descriptions and manage multiple job postings. 

Collect and Process Applications: An applicant tracking system collects and organises incoming job applications, CVs, cover letters and any relevant documentation in a centralised database, making it easier to review and process candidate information, all in one place. 

CV Screening: An ATS can automatically conduct CV parsing, extracting relevant information and keywords to assess whether candidates meet the specified criteria. 

Candidate Tracking: As the name suggests, an ATS simply tracks the progress of each candidate through the hiring process, from application submission to chosen stages such as interviews, assessments, and job offers. 

Interview Scheduling: The best applicant tracking systems also offer features that enable recruiters and hiring managers to schedule interviews, taking into account the availability of both parties. 

Candidate Communication: An ATS facilitates communication between recruiters and candidates by sending automated emails, updates, and notifications at various stages of the recruitment process. 

Collaboration and Evaluation: An applicant tracking system allows hiring teams to collaborate by sharing candidate profiles, conducting evaluations, and providing feedback within the software. 

Candidate Database: The system provides a searchable database of candidate profiles, making it easier to identify and engage with suitable candidates for future openings, helping further reduce time to hire. 

Reporting and Analytics: Your ATS software should be able to generate reports and analytics on various recruitment metrics, helping you track the effectiveness of your hiring strategies, and return on recruitment investments.  

Compliance and Documentation: Applicant tracking software should help ensure compliance with recruitment regulations by storing candidate data securely and maintaining an audit trail of actions taken during the hiring process. 

Candidate Experience: Top applicant tracking systems should help enhance the candidate experience by providing an easy-to-use interface for submitting applications, checking application status, and communicating with the hiring team. 

Our HR and Payroll specialist Adam Barrett recently spoke about the importance of getting return on investment from your applicant tracking system: 

How to choose an applicant tracking system

Many applicant tracking systems are part of a broader HR software suite, helping you connect data, people and processes. We will look into the pros and cons of point-solution applicant tracking systems later in this guide and the benefits of applicant tracking system integration with your other HR software. 

In the meantime, scoping out your requirements will likely require the following steps: 

1. Identify Your Needs: Determine the key features and functionalities that are essential for your recruitment process. Consider aspects like candidate management, CV parsing, collaborative recruitment tools, reporting, and applicant tracking system integration capabilities with other HR systems. 
   
   
2. Ease of Use: Look for an ATS that is user-friendly and intuitive for both recruiters and candidates. A complex system might lead to challenges in adoption and use. 
   
   
3. Scalability: Consider your company's future growth and ensure that the ATS can accommodate scalable recruitment as your business expands. 
   
   
4. Integration: Assess the level of applicant tracking system integration required with your existing HR software, such as your HRIS (Human Resources Information System), screening or payroll systems. 
   
   
5. Customisation Options: Check if the ATS allows customisation to match your company's branding and specific recruitment processes. 
   
   
6. Mobile Compatibility: Ensure that the ATS has a mobile-friendly interface to accommodate applicants who prefer to apply from mobile devices. 
   
   
7. Security and Compliance: Confirm that the ATS offers data security and complies with relevant data protection regulations. 
   
   
8. Customer Support: Research the vendor's customer support services and availability to address any technical issues or concerns. 
   
   
9. User Reviews and Recommendations: Read applicant tracking software reviews and testimonials from other businesses to gain insights into its performance and user experience. 
   
   
10. Cost and ROI: Compare the costs of different ATS options and consider the potential return on investment based on the time and efficiency savings it can provide. 
    
    
11. Demo and Trial: Request a demo or take advantage of a free trial to experience the ATS firsthand and evaluate its suitability for your needs. 
    
    
12. Vendor Reputation: Choose a reputable vendor with a track record of providing reliable and effective ATS solutions. 
    
    
13. Data Migration: If you are transitioning from an existing ATS, ensure that the new system allows for easy data migration. 

By following these steps and carefully assessing various ATS options, you can make an informed decision and choose an applicant tracking system that aligns with your business requirements, streamlines your recruitment process, and enhances your overall hiring success. 

How much does an ATS cost?

The average cost of an applicant tracking system can range from a few hundred pounds to several thousand pounds, and can be charged monthly or annually depending on your provider and your contract terms. Applicant tracking system pricing can vary considerably depending on factors such as:

• Business size
• Selected features
• Number of users
• Number of jobs posted
• Pricing model

There may also be some free options available with more basic or limited features. 

There are two main routes you can go down: a point solution, or an integrated platform. While a point solution might fix a short-term problem, it may not provide the flexibility you need and could add to your frustrations in the long run. Applicant tracking system integration integration will likely cost more at implementation, though, and it will be a bigger task to set it up – there are pros and cons to both. Here, learn more about different pricing models, what they include and whether a point or integrated solution will work better for you. 

The best way to get a complete, bespoke quote for an applicant tracking system is to get in touch with a HR software vendor and request a walk-through so you can find out the exact cost of the features you need. 

The main ATS pricing models explained: why do they vary so much?

There are four main pricing models when conducting an ATS pricing comparison with vendors – costs are calculated differently for each, which is why there can be a lot of variety. This means you can select a model that best suits you, only paying for what you need.

These are the main ATS pricing models:

1. Pay-per-recruiter. This is one of the most popular pricing models for an ATS and involves a fixed cost per user. Each user will have their own login so they can access the system at any time – you will likely find this option most beneficial if you have a well-established talent acquisition or recruitment team.
   
   
2. Flat fee. Another popular option is to pay a flat fee for your ATS. If you use a SaaS cloud-based system, this will be a monthly or annual charge from your provider. You may also choose to have on-premise software but this is much less popular and means your team is responsible for all management, hosting, updates and security.
   
   
3. Pay-per-job. You pay either for the number of job openings you post, or for the number of candidates who apply. This pricing model can be a good option for steady hiring – if you have peak hiring periods, it may become unaffordable during these times.
   
   
4. Pay-per-employee. The cost of your ATS is dictated by the number of employees you have. Typical costs are estimated per employee but these may be lower for large organisations so prices don’t become prohibitive.

Additional costs to consider

1. Support. Find out if your ATS provider offers any support built into the price – if they don’t, this can add to the costs if you need help further down the line.
   
   
2. Implementation. With some providers, implementation can be an additional cost. Find out any additional fees before you commit.
   
   
3. Training. You will need to provide training and find the necessary resources internally, or arrange for training with your software provider which may cost more.
   
   
4. Business growth. If you have additional members of staff or need to advertise more jobs, your prices will rise on a pay-per-employee or pay-per-job pricing model. If you need to add more system users, prices will increase on a pay-per-recruiter plan as well.
   
   
5. Peak periods. You may advertise additional jobs, which will increase costs within a pay-per-job pricing model.

Point solution or integrated solution?

A point solution is one that has an individual use case and is designed to tackle one specific area or problem. A point ATS solution would manage applicant tracking alone, without any wider HR functions. However, different point solutions can sometimes be linked together to create an integrated system with broader capabilities.

The pros and cons of a point solution

Pros of an ATS point solution:

• More specialised. If you have very specific applicant tracking and job posting requirements, a point solution could be a good fit. 51% of employers plan on filling new, permanent roles, so a reliable, specialist solution will be essential.
• Lower cost. An applicant tracking point solution should have a lower price point than a fully integrated HR solution.
• Options for integration. You may be able to integrate solutions with other software if you need to scale up your operations in future.

Cons of an ATS point solution:

• Integration can be difficult. Point solutions don’t always work well together and can increase siloed ways of working.
• Limited scope. You may find that your ATS limits you in future if you want to add on additional solutions and what you need isn’t available.
• Maintenance. If you have multiple standalone HR systems, they will all require maintenance on different schedules, from different providers.

The pros and cons of an integrated solution

Pros of an integrated ATS solution:

• Streamlined processes. Software that spans multiple HR and recruitment functions can reduce manual processes and streamline workflows.
• A broad overview. Your systems and data will be combined to give a holistic overview of organisational data. Integrated solutions such as PeopleXD offer end-to-end visibility, with tools for onboarding, recruitment, scheduling, training, payroll, analytics and more.
• Futureproofing. You can be prepared for the future with fully scalable features that are part of the same HR suite. If you need to add more users or roll out software to additional groups of employees, this is easily accomplished as well. With 77% of employers reporting difficulty in filling roles, integrated solutions can support your overall hiring strategy.

Cons of an integrated ATS solution:

• Costs. Setup and ongoing costs may be higher for a fully integrated solution.
• Implementation. The implementation process will probably be more complex and require input from internal teams, as well as support from your ATS provider.
• Unnecessary complexity. An integrated HR solution may not be required based on your organisation’s current needs. However, if you’re in a position where you need applicant tracking solutions, your business is likely growing and you may require add-ons in the near future.

Is an ATS worth the investment? Cost vs value

It’s important to balance costs against the benefits of an ATS to show its true value. Ask yourself some important questions: without an ATS, could you attract top talent as effectively? Or fill positions quickly? Would you be able to keep the process organised? 73% of potential applicants are passive job seekers, so having the right ads in the right place at the right time is essential. An ATS can also help you improve on important metrics such as time to hire – the average is currently more than 27 days, which could be reduced with the right software. You also need to consider time spent on administrative tasks – an ATS can save more than 20 minutes of time per job post, which really adds up when advertising multiple positions. Once you factor in additional time savings, an ATS quickly begins to pay for itself.

You should also bear in mind what the hiring process is like from a candidate’s point of view. Employee and candidate experience needs to be a top priority. It costs between six and nine months of an employee’s salary to replace them, so giving them the right experience from the start is key.

Adam Barrett also recently spoke about how it's important for applicant tracking systems to meet both candidate and organisation needs:

Choosing the best applicant tracking system for your organisation

An ATS may take up a significant portion of your recruitment budget, but the value far outweighs the cost. Consider your options and see if you could add an ATS into your existing HR software suite, or think about HR technology more holistically as part of your organisation’s digital transformation. Weigh up the options, identify potential ATS providers, book in a demonstration to get a full quote, and perform an applicant tracking system cost comparison. Then present costs alongside time savings, benefits and return on investment to help get buy-in from stakeholders. Finding the right ATS will transform your recruitment processes and greatly enhance your hiring capabilities.

You may also be interested in:

• Improving recruitment and selection: A guide for hiring teams
• Benefits of HR software
• How to choose HR software
• How to implement a new HR system
• Problems with legacy HR software and how to build a business case
• Calculating the ROI of HR software