How to Build a Recruiting Capacity Model (part 2)
Podcast Overview
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Eric Guidice: Season two, episode three, or episode 12 overall, however you want to talk about it, Headcount Experts, we're back with Chris Mannion. We're gonna start it off very differently this time around, where we're gonna share a little bit of a preview of the course that is big bucks or little bucks, depending on how you view the investment. But you get a free look here on Headcount Experts. So Chris, walk us through your Headcount Forecasting course. Give us a teaser, and that way it'll kind of help us continue the conversation from last episode where we talked about recruiting capacity building a head count plan for your hiring plan and building a capacity to forecast within it. So this is a little bit more tactical, but let's show us how you get it done.
Chris Mannion: Also, are excited to dig into the actual tactical implementation here. So here's the course that I'm going to reference. So this has just gone live on the Meander Talent Academy as of last week. I've built a whole learning management system. Essentially what you do is you go through the course, there's 16 lessons, each is a video, and then there is linked templates. And so what people do as they're going through the course is actually build the template up themselves. But what I wanted to do is actually add some more tactical reference to the discussion we had last week where we were talking a lot about, okay, strategically, how do you do recruitment capacity planning? This is actually how do you actually put that into a spreadsheet and then get the data out.
So I'm going to do a very quick run through, but there's essentially just a few tabs that are really important. The first is the head count forecast. So we look at the head count projection and given the capacity, we'd want to see what is going to be the backlog for requisitions over time and then how likely are we to hit our goal head count. And this is based on plan nutrition, plan growth. So you basically tailor these to create a very rough head count plan. So if you're not doing the full head count plan in the, I included in another course or you're using head count 365, you just want to make some quick assumptions. This is a way to do it and really get a feel for what capacity you likely need in order to deliver against that. And then there's the kind of real time tracking month to month. You could actually look at the backlog and the actual hires to planned hires and then see how your backlog is changing over time. This was something that we would always send up to the CHRO and then other people on the exec team would be interested in this.
And we're basically showing you as of February, are we on track to hit our hiring goals this year based on what we know currently? And this gives a very simple pun to actual hires and pun backlog to actual backlog. And what we want to do is see this actual backlog decrease to zero by the end of the year so that we know that we're to close all the roles. And then there's two real drivers to this. There's a very simple capacity model. This is based on some of the discussions we had last week, but you basically build in a reverse funnel to figure out what is your monthly capacity.
The key metrics here are in purple. And what is your highest per month by recruiter and what is your capacity given the amount of recruiters that you have on the team. Then we have a multi-team version, which runs the same thing, but you probably have different functions. There's essentially three simple functions here, entry level, business and technical, which have different funnel conversion rates. And based on this, we can actually assign recload over the course of the year to everyone across the team and then calculate the total capacity for that team and actually hires per month so that we actually get a more realistic view.
There's a few other kind of things that feed. The main one that I think we touched on last week was the non-recruiter capacity needs. So when you're talking to your stakeholders, your senior leadership on the business, we can actually give some more information based on the projected amount of time that's going to be needed for those interviewers to actually spend in the recruiting process to actually get those roles to close. And so you can change the assumptions in here in the yellow buckets, but essentially what we can then do is say, okay, given what we need to do on the recruiting side, we need 110 hours of hiring managers time this month in order to deliver against those hires. We also need 40 hours of coordinator time, given the amount of time it takes to actually get those roles together. So that was like very, very quick cancer through, but happy to kind of get into the weeds a little bit more on the tactical side of this.
This is one way to approach capacity planning is the way that I found to be most effective when working with lots of different people because the models are very simple. And when you make one change in one cell, you can actually update the whole thing and kind of run scenario testing real time with your stakeholders. So I'm going to stop there with the walkthrough, but I'm really excited to dig into the weeds with this. I've got a lot of feedback on this course. Quite a few people have taken it and hopefully it's been very valuable for them.
Eric Guidice: Yeah, I've heard good things about the course even before meeting you. This is a, it takes the bones of all the different systems, right? This course and this spreadsheet is a system of how to do headcount forecasting and then execute and report up and even give action items to other stakeholders who participate in the process. And it takes the core bones of give me a target, I'll show you a capacity or the ability to hit the target as a forecast and then we'll monitor change as a team so that it's a collaborative effort to fulfill this hiring demand.
I think whether you're using this tool or Headcount 365 or any other headcount management or headcount forecasting tool, the bones is what I think what we're trying to get across in this episode and kind of all the other things that we have, which is the more transparency you have about what is to be expected and the more you can rally the team around an easy understanding of how you're gonna go about executing that plan with good reporting about your progress allows the recruiting team to be less the sole burden of performance and it becomes more of a business conversation. So recruiting while led by a head of TA or part of the people team is the most cross-functional part of the business because everybody participates. And so if you're not distributing that accountability and distributing the information that everyone needs to participate in that process, then that is the real failure.
So even if you're hitting your goals insular to recruiting and you're not communicating this process or its efficiency back to the business, that could be considered an inefficiency or a failure in the future as you continue to scale a business because there's a number of issues with that. Anyway, I like the model. What made you make the course? How did you get to this being the course? And what's the 16 lesson breakdown of these five or six different tabs that you showed us?
Chris Mannion: Yeah, I mean, it initially started because we were focused on building a product for PeopleOps to actually help with, it was a talent intelligence product. But one of the things that I found is that all the customers that I was speaking to, potential customers, didn't actually have the data in the right place in order to actually implement a talent intelligence approach. Whereas senior leadership was saying, let's get more intelligent in how we're thinking about re-skilling our workforce, the fundamentals of actually understanding what that workforce was gonna look like over six or 12 months was really difficult.
And so through those conversations, I actually uncovered this need for recruiting capacity planning. It was then that I created a 10 minute YouTube walkthrough of how do you build a capacity model in 10 minutes? Here's a template. Actually kind of took off, it got shared across a number of different blogs. It got shared in kind of dark social. And so as I was tracking the metrics on the YouTube channel, I was like, oh, there's potentially something here. So I decided to actually expand that a little bit more, take some of the work that I'd done previously in building these models and create very simple approaches.
But actually, instead of just giving someone a template to put their own data into, I wanted to create a course to walk people through actually how to build it themselves. So it's really designed to be an up-skilling process. And it actually came from a need that I couldn't take all the calls to answer all the questions on the YouTube videos, because it was right before our second child was born. I was going to parental leave. I needed something to give people so that they would become unstuck after going through the content I was producing. So I could take two or three months off while we brought our little man into the world.
Eric Guidice: Yeah, no, that's congratulations, first of all. I think you and I, Sands, the child set up have a very similar coming to be onto this podcast, but the need, when I was leading TA, especially in the high growth environments, I would come to an executive meeting where every person had data about their business that was served to them about what was asked of them and how they're able to fulfill it. And they had incredible systems to do so. It could have been Zendesk for CS and they knew all about number of tickets and volume and speed to resolution. There was Salesforce for the sales teams. There's ClickUp or GitHub for engineering.
So there's all this information about what is being asked and what is the capacity to produce? What is the actual output? What is the impact to the business? Then they turn to recruiting and we have like the funnel, which is essentially like ticket flow for engineering or like the call metrics for CS or the gong recordings for Salesforce. So it's like, how do we get information that allows you to have a seat at this executive table for the recruiting production, for the production of this hiring process? And so the thing that I like about the reason why I pursued this podcast with you was because there's an underlying understanding of what it takes to create that information.
We've both been in the room and been pressed and through that pressure has come solutions. The capacity demand forecast I built for Unicorn is what led to the headcount 365 journey. And for you, the wayfair pressure and even the pressure from YouTube into being able to have folks self-serve led into this course. And the bones are half what we covered last week, which is what are we even doing here? And the other half is how do you apply it to the business?
So what I like about that first tab you showed is it's like this really crisp forecast with assumptions of what is being asked and using the previous data that we talked about last episode of like, okay, how do I factor in recruiting capacity as a baseline, attrition as a baseline, you know, monthly growth, and then you could start to highlight the discrepancies or you could be proactive about the variance. I think one of the main takeaways of why headcount forecasting is important to all users within the business, but specifically TA, is if you wait until something's going wrong to fix it, that's a bad look. It doesn't feel good. No one thinks that you're a credible leader. So the proactivity of being able to spot that delta is kind of like one of those main things. Give me an idea. I saw the beginning forecast, we work through that backlog. How do you apply the idea of proactivity to variance in a future forecast, variance between what the business is asking and what you're able to produce? How do you do that in your head account forecast? How are you communicating to finance, et cetera?
Chris Mannion: Yeah, I think the chart was the way that we would find that we would get the most engagement. You can present a table and we used to have color coded tables, red, green lights and the marketing team had it. We had it in supply chain. It was only when I moved into TA that I realized that that function had never really had that kind of approach before. And so that's why I wanted to create a very simple looking ahead based on the current assumptions that we have.
Eric Guidice: Okay.
Chris Mannion: What we expect to happen over the next kind of 12 months. And it really comes from going into quality business reviews internally with the senior leadership team, where they would expect that forecast to your point. If you're coming from the sales team, you should expect what your revenue is gonna look like over the course of the year and how your funnel needs to be built in order to deliver that. What you need from the marketing team, what you need from the delivery team in order to kind of accomplish those revenue goals. And we didn't really have that from a TA side.
So this was a very simple approach, is given where we're starting with the overall kind of headcount that we currently have, where we want to be by the end of the fiscal year in headcount, where we expect the outflows to come from with planned attrition or no attrition or estimated attrition, and then what is our hiring ask that's come from the business. And one of the big challenges that I used to see was that the hiring ask would come in, but we wouldn't really forecast attrition effectively, or we'd be very conservative with attrition forecast.
Maybe we'd assume it's 10 percent, but if it's then 15 percent, then we're gonna be understaffed to deliver against the net new roles because every backfill role is priority zero. And that means that it takes the place of the net new role that's coming in. And so you're never really growing the business in the way that you want to. And that kind of hurts everything else that's downstream. So having that forecast of taking what we currently know and then plot that out over kind of 12 months and we compound that. So as the business grows, if we keep the planned attrition rate each month the same, we're going to actually attract more people each month. So if the business last year was 400 people and this year it's 500 people and we have a 10 percent attrition, we're actually going to lose 10 more people this year. It's not going to be 40 net outflow, it's going to be 50.
And I think a lot of that is not necessarily appreciated unless you come from sales or supply chain or marketing where you're actually doing these kind of analyses in real time. And what I wanted to do is actually have the two boxes are really important. The yellow box is the estimated monthly attrition and estimated headcount growth, because then in real time you can actually change those and say, well, okay, so if you're assuming that we're just going to have 1 percent monthly attrition, this is what the plan looks like. But if we expect attrition to increase, you can do your sensitivity analysis.
So let's say we were at Wayfair. I say Amazon is going to open up a new office down the street and they're going to try and pull all our AI talent because they actually are investing in computer vision and it's something that's critical to us. So what is the impact of that going to be on our attrition if they're offering more pay and actively recruiting against our current employees? And so you can model that within seconds. You can just say, okay, let's assume that attrition increases to 1.5 percent. What does that do to our backlog? And then what does that do to our capacity needs? And so very quickly, you kind of create these upper and lower bounds and then come up with assumptions and say, if like a conservative assumption is that we need 15 recruiters, expected is 20, but if we actually get all of our talent poached, we're gonna need more like 30 recruiters.
And so you can then start to plan capacity and each month actually update actuals to forecast and really hone in on and actually getting that forecast more accurate over time. It can get very technical. And this is one of the problems that I would see with working with our analytics team is they would produce these incredible models, but a lot of the TA leaders and even the business leaders couldn't really understand them. So we had to really simplify them down to a point where you make one change in one cell and you can instantly see the output change on that.
Eric Guidice: Right, you touched on two things that I think are super important. So one preaching to the choir with the type of glass back, right? Like I think attrition, if the simplest way is percentage blanket per year and then you could model it. But like you're saying, there's external factors, there's seasonality of your business, there's comp, there's people who have a certain length and role. There's a lot of enhancements you could do for what happens with attrition, then with a changing market, your backfills might look differently, your backfills might happen in different locations, it might happen at a volume difference, then what I see today a lot is with the presence of AI increasing the skill level, globally, you'll see people move roles from one high paying area to a lower paying area, but you'll hire two for the same dollars.
And so there's a lot of complexity to the model, I think. Both of us try to tackle it. We've both been through the wringer in terms of an internal role and have these spreadsheet models to do it. And we're taking our different solutions about it. But underlying to anyone listening is with a headcount forecast at a given point in the year. So what I presume you're talking about is this snapshot of we just got the headcount plan at the beginning part of the year. And most companies will do a reforecast where everyone rebases their expectations, but at the point where you have that first expectation where everyone's aligned, this could be annually, quarterly, having a way, having a stance on how your modeling will allow you to set your own target for target to goal. Whether you choose to stand by that for your own personal benefit is on you, but if you're going to forecast attrition, what you're saying is this is my target.
This is how I'm staffing my team against this target. And this is what you can expect from an output perspective off of this model. And models aren't meant to be 100 percent correct or the hiring plan would have just been correct from the get-go. We wouldn't even need this model. So what you're doing is you're saying, this is the degree of accuracy that I look to perform within. And you want to know the demand. You want to know unplanned additions to that demand. You want to know your capacity to fulfill that demand. And you want to know how changes in your marketplace are going to impact your ability for this kind of supply demand curve to come together.
And that is kind of like take number one. The second take that goes along with that, which you touched on briefly with the sales team, and I want to kind of bring this up because it's like such a point to be made is like, if you are a seller and you don't, and the supply demand curve of sales deals to sellers doesn't come up, there is an immediate, tangible price that you are going to miss or not miss on that. And that's how quotas, that's how it all comes together. And every business leader has this quantifiable anchor to making an investment in that sales team do better because they need to hit this number, which is selfishly probably how they're all bonused on, but that's the business target.
And with recruiting, if you lack the why is it important to you, you're going to get people go, okay. And then they're going to move on to the person with the shiniest, biggest, sales number missing in the room. And you need to, it's not a competition in an executive meeting, but if you've ever been in an exec meeting, there's a certain, let's call it urgency management that happens around what the business should be focused on. It's very singular to the moment of that executive meeting. So that's the type of stuff that, yes, you need this model.
How did you, either at Wayfair, how do you advise your customers today? How do you take what you have on this model and make a, if you don't or if you do, this is the cost or the benefit. How do you get that number and do people believe it? And how do you get them to participate in that number? And I'm interested in two ways, one, the snapshot and two, into how you build the hiring manager interview hours or how do you get their participation? But how does Chris Mannion, expert of headcount, get that from model on paper to executive caring.
Chris Mannion: Yeah, so the reason I created the model the way I did is that you can just put it up on a screen and very quickly someone in the business will get what you're saying. And practically what I've seen happen with this model is there was, for instance, we went into one meeting where we were trying to explain to one of the C-level execs why we were going to miss recruiting targets for the year. And it was based on increased attrition across his function and also increased demand for a new area he wanted to invest in and we were capped as a TA function on the amount of recruiters we could actually employ.
These were all kind of internal constraints that we were dealing with. And so we actually walked through the model and said, okay, well, this is how many we could actually deliver. This is what we're doing based on the capacity model within the team that we've currently got. We've allocated your resources appropriately because we have five other execs to support. And he looked at the screen and said, okay, well, what if I give you three of my recs to hire more recruiters and we make that internal transfer? And so we modeled that quickly and said, well, yeah, so you're hiring three fewer people.
We have three more recruiters in capacity that are dedicated solely to deliver educational roles. We'd actually meet your goals. And so, very quickly he took his three lowest priority recs, moved them across to the TA function. We increased the size of the TA team, at least for that year, and we delivered it against those hires. We actually hit the numbers and kind of close the year out on target. Whereas if we hadn't had that model and that conversation that took 15 minutes, we would have, six months down the road been scrambling to figure out why we weren't hitting targets.
And then all of a sudden we have this difficult conversation and we're looking backwards to try to find reasons for not achieving it. Whereas at the start we were looking forwards to figure out ways that we can actually hit the goals that they need. And it's kind of coming together with the business. We talk a lot about the importance of stakeholder management, but that was like a prime example where I saw the power of having a very simple model and focusing on the communication of the data more so than having a perfect model that no one can understand. So that's like, first question, I really like simple models because of that one experience that actually happened many, many times.
Secondly, the actual analysis of how do you actually create estimated funnel metrics? I think that's a little simpler if you can go back and look at your ATS. And one of the things that I like to do is segment different pipelines based on similarities. So we know that a lot of like software engineering roles are probably going to have the same kind of pipeline in terms of pass-through rates. And so we can kind of build that reverse funnel up. And we actually used to give new recruiters this as a case study when we were interviewing them for a role. Can you actually build a reverse funnel to tell us how many people you need to reach out to on LinkedIn in order to get one higher at the bottom of the funnel.
And that was like a base assumption for any new recruiter coming into the role. But all we're doing there is building that up for all the roles, but you can't build that for 2000 unique profiles. So maybe you have four or five different segmented pipelines and then look for each pipeline, how many people are at the top of the funnel in order to talk to enough people as a recruiter to actually move through to hiring manager stage. And then how many people did you get there? You can use percentage, you can actually look at raw numbers. But by getting those numbers in, and then by making an assumption based on the amount of time it takes to actually process someone at that stage.
So this is the kind of people supply chain model of actually thinking about recruiting as a assembly line where there's a timing stage for each process and that process takes a certain amount of time to run through. And so you actually allocate time to each stage. And you can do a lot of very interesting things that I started doing and actually looking at actual recruiting utilization based on the estimated time it takes to each stage and how much time, or what is the kind of the actual output of each recruiter. And you can actually start to see a lot of variance across the team then.
So, yeah, if you have someone who's hiring a lot of people and you estimate the time in process for each hire is so many hours, you just divide one by the amount of hours available by the amount of hours dedicated to actually the recruiting process based on the results. And you get a utilization percentage. And in some people that was 35 percent, some people it was 80 percent. And we can go probably on a future episode deeper in what do you then do and how do you then identify where to make improvements. But I think having the data in place and having the reverse funnel metrics just gives you a lot of power to make these models a little bit more accurate, but also change those assumptions in real time to figure out what happens if we improve top of funnel screening, what happens if we improve the hiring manager workflow, and it actually produces a business case for some of those investments that you might wanna make further down the road.
Eric Guidice: Let me do some, I want to speak in abstract so maybe I can make an image afterwards, but let me do some math on the TA example, the engineering TA example that you gave, right? So one, an engineering team produces the product that the business sells. So let's say that every engineer has a indirect correlation to future revenue. It's probably much simpler to just speak in terms of sales where if you hire a seller, they make direct revenue. It makes the analogy easier, but three recruiters at three hires a month is nine hires times, let's call it the last six months of the year. So we're looking at what, 54 hires that those three recruiters would produce that you wouldn't have been able to produce if you didn't hire them.
And what you're doing from a mathematics perspective or from a tangible value perspective as you're saying, what is the opportunity cost of not hiring those people? So here's what they wouldn't produce if we didn't hire them, but you had those three extra on your budget. So you'd get an OPEX savings from not hiring people, but you would also produce less. So you produce 54 or some sliding scale of less output if you didn't hire these recruiters, or you can make that investment. You could partner with the business. You could move headcount over to TA and you can get those 54 hires and then you can hit those goals. And so when you're building the case to hire more recruiters, that's like the ideal, that's S tier to speak in a certain type of language, but that's the best possible scenario is the business understands that an investment in TA actually returns for them more than holding onto that budget.
So in one bucket over here is the math that's behind that example that you gave. I think the other big thing that you called out was kind of like the constraint identification. So how do you get the, how do you unblock the flow of the backlog by identifying the constraint and investing in that constraint? So in the first example, you got TA folks over, it was sheer capacity. But as we move into your hire manager interview hours, or we look at source to application rate or the number of volume in your funnel, there are constraints, right? In the Chris Mannion's people supply chain concept, there's the candidates that flow into recs that flow into the process that then make hires. So how do you go about, when you're building this model and you're looking at what the initial forecast is and you're looking at the backlog. What is your process? Give me like your step-by-step process. How do you work backwards into finding the constraint? What do you do?
Chris Mannion: Yeah. So I actually ran this when I first built this Recruit and Enablement team that I was forming to try and solve some of these problems. And it started with the exact same process I took when I was at Amazon doing a supply chain project of starting with a kind of a time study. This is like classic people analytics, IO psych. It's actually looking at an individual and figuring out how long does it take to actually do all the different tasks that are required in order to complete a process. And so that process is recruiting someone. So how long does it take to actually screen someone and set up the screen and do the outreach to actually create that phone screen?
And so you kind of create all these different steps and you say, okay, well, it takes 15 minutes of in-mails to coordinate the phone screen. Then it takes the recruiter 25 minutes to phone screen plus 15 minutes to actually fill in the scorecard. And then, another 20 minutes in follow-up. And so you kind of like build this process. And then you kind of layer that onto the funnel and say, well, the recruiter needs to conduct a hundred phone screens in order to get 50 people through that they think are good enough to talk to the hiring manager.
So if it's a hundred to 50, and then that 50 hiring manager screens gets to 25 for push around interviews and that 25 gets down to five. And then at five out of the five, you pick the best person to present an offer to you kind of like build that reverse funnel. And so that's the assumption going in and you say, time-based study, how long should it reasonably take to produce this one hire? And so from there you get, okay, given utilization of recruiters, how many hires should they be making a month? And so this is your like theoretical ideal amount. You say, okay, we should be producing five hires a month per recruiter.
And then you actually look at actuals and you say, okay, the actual recruiting team is producing two hires a month. But now because you have this assumption of, what should a perfect process look like, you can match the actual process and aggregate to this perfect process and figure out, if we're spending more time top of funnel, middle of funnel, bottom of funnel, are we not producing the offer conversion rates that we need to? Are only 50 percent of offers actually converting to a higher? And you can start to kind of stack them based on the amount of time that's invested in each stage and the delta that you have to the actual recorded metrics to figure out what are the most critical things that are stopping you from meeting your five hires per recruiter per month goal.
Once you start that ranking then you can start to come up with ideas of, how do I solve it? Is it a scheduling problem, is it the coordination team? Do we need auto scheduling? We need to have, one of the things we did is actually have recruiters schedule the next round on the phone with the candidate when they finished the phone screen, if they're gonna move that person across. That way you're not kind of wasting time between stages. Once you have this data, it's actually quite easy to see very clearly where the deltas are. And from there, some things that, low-hanging fruit, it's very easy to fix the problems. Maybe it's a process problem in the ATS or whatever. Others require a business case to hire more people or buy more tools or get more time from the hiring manager.
And that's where it becomes a little more critical to have that data. And then you can show, going back to our example of working with the exec team, you can show, we're supposed to hit five hires a month. Everything up until the hiring manager interview is working as expected. But what we're seeing is we're only at 50 percent capacity for the hiring manager interview based on what we believe it should be. And the two main drivers are one, not enough availability of hiring managers and two, feedback's taking seven days to go in the system. And so we're not able to schedule the next round until we get the feedback.
And when you present that to the execs, they kind of quickly see the impact that's having and you're only going to fill 50 percent of target roles because of this one constraint. And so very quickly they can get onto their team and actually get buy-in. So it's like a very long-winded way of like the process I go through. It's obviously more detailed when you get into the data, but I think hopefully most people will be able to understand that workflow and actually implement something like that.
Eric Guidice: I think what's interesting when I hear you break it down from like a very people analytics lens, that behavior is happening with at every company at every stage, regardless of if you're actually doing it, it's just less sophisticated and you go all the way back to the smallest startup, hiring managers are doing their own hiring. And at some point they say, let's consolidate this into a recruiter. And then you full cycle recruiter. And at some point you need to maybe segment the process or segment parts of the process, give it back to the business.
And as the team gets bigger and bigger, there are these different processes that you can either segment the team or specialize, or you can distribute across different teams. We talked about this a little bit last episode, there's a philosophy of what the recruiting team has done. And I'll pop it up on the screen now. I have this recruiting capacity triangle that I put up where it's like, if a recruiter's focused only on production. Doesn't have to do the experience, the scheduling, the coordination, the project management, the analytics. That person's going to do way more hires a month than someone who has all of those responsibilities.
And so each company has a style, each leadership team, each executive within the leadership team has an idea of what recruiting does for them based on their own experience. Some's not so great, very service based, very do what I say and some is a lot more collaborative and within a team, you have to not only manage what the business is asking for, you have to manage all those different diverse opinions into like, what is the best execution strategy for your team? So the bigger you get, the more complex it gets. I think, there's a few resources that we've done in the past, 12 or so episodes that allow you to see that you start with a forecast and here's the way that you different, that you can track it differently. The question that I have is like, how do you decide with the model that you have now, how do you decide as a team what you do to manage it? And how do you get the executives in that conversation? You've been through the course, you get Chris Mannion's total spreadsheet, you understand it, you're starting to apply it to your business, you now have all the information. How do you build that plan? When are you doing it? Are you doing it before the quarter starts, at the beginning of the year, during planning? How do you apply this model so that you get the most results out of it?
Chris Mannion: Yeah. And so I like building the model from the start for a forecast for the year ahead. Then the beauty of the simplicity of the model is that you can update it whenever something changes. And so that may be weekly, probably more likely monthly. But I think each month you're looking at the pacing dashboard and you're looking at the kind of assumed performance versus the actual performance. Cause you pull the data from the ATS, you look at how many highest did we actually make? If we were supposed to make four and we made three, do we just have one that's kind of like waiting to close or was there something wrong in our assumptions?
And so each month you actually kind of create this loop of going back and saying, well, how did reality match up to expectations and what was the reason for that change? At this point, it's actually quite helpful to produce a report. The burn down charts were something that we found very helpful because you could actually then see even in some months when the recruiting would overperform against expectations, what the kind of total impact was over the course of the year. And so if all of a sudden you get an influx of new roles, that doesn't just kind of sit in the rec tracker that actually goes into this burn down chart.
And so you can see, planned hires actually went up month over month, even though we closed a whole bunch of recs. And so the model has to change. And when the model changes, the assumptions for how many recruiters we need changes. And so very quickly you can show okay, because you added 50 more recs, if we don't hire these recruiters right now, we're going to be short by the end of the year by this amount. And it just helps in that, example of an exec actually, they actually took the recruiters on their P and L rather than sitting within TA. And so they actually took the OPEX cost because they did that cost benefit analysis.
But by updating this monthly, I think it gives you that kind of clear picture. And it also kind of triggers questions then of okay, well, why did this happen and what can we do to prevent it happening again? And if you're leading this, either on the kind of town ops or town analytics side, or as a TA leader who's now responsible for analyzing the team, which many TA leaders are getting this additional responsibility, you can actually start to come up with answers before the questions arise. And that puts you in a really strong position to lead these conversations and not just be bombarded by questions when you go into these exec debriefing sessions.
Eric Guidice: I think for the way that I look at the executive team is going to have their, they're not executives because they went along with everything. Do you know what I mean? Like they have an opinion and they're going to want to do things their way to a certain extent. So it's essentially just managing, you're managing the personalities, right? So if you are the sole recruiter at a place and you're invited into the executive meeting because you're the point person or you're an executive at a place that has seasoned executives from other large companies, your job is to agree on a context and let the data guide the conversation and be the point person for resolution rather than being the burden owner for total performance. And I think when you apply a model like the one that you have and you create this starting point, that's, think, what we're going to rally against.
So to put like a bow on all of this, I know we're coming up on time, but to put a bow on all of this, right? What your tool does is it allows you to set with the team at the stage of planning. Here's what we're agreeing is going to happen this upcoming year. And these are the assumptions that I'm making for the unpredictable. Once you have that agreement, you're then able to build a capacity plan in two ways. One, what can the recruiters do and two, what can the hiring managers do? And from there, you're going to identify the constraints of this process using previous data and potentially some of the data from the net new hiring plan. Previous data is being a funnel conversion rates, recruiter capacity, and maybe some hiring manager behavior about speed and velocity or whether or not they show up to interviews on time or actually create the space for you.
So you're going to set your context, you're going to make your assumptions, you're going to agree on capacity. And then over the course of time, you're going to track the variance between what you would plan for and what actually happened while quantifying the cost of all of these things for executive consumption with the idea of changing behavior towards an agreed outcome. And that quantification is going to use what you know or how you partner with executives to understand the opportunity cost of not hiring someone. They're gonna tell you, okay? The one thing I know about an exec is if you don't hire for them, they know exactly how much it's gonna cost and they're going to make sure you know about it.
And the real dance for me as I kinda got better and better at managing these exec expectations is getting them to say the same thing to me and my team as they're saying to the exec team and not overblow it or fight for capacity or yada, yada, yada. So, in summary, make a target, make assumptions, get everyone on the same page, track variance, and then understand the costs that you can make change towards a unified goal. That's the overarching, if I look at the Chris Mannion, people supply chain and corresponding courses that help you achieve these metrics. What I'm taking is those kind of five core principles as a means for you to go and make a capacity plan and start assigning stuff to some recruiters and getting some hires done. Did I nail it? I hope so.
Chris Mannion: Sounds good. Yeah.
Eric Guidice: Okay, well another great episode of the headcount experts will summarize it on the blog later and get the video up shortly, but I'm very excited to continue the conversation and looking forward to potentially having some exciting guests come on. So stay tuned for some future episodes and tune in again for another episode of the headcount.
Forecasting Recruiting Capacity at Scale
This episode of Headcount Experts features Chris Mannion, who provides a tactical walkthrough of his headcount forecasting course and the "People Supply Chain" model. The discussion shifts from high-level strategy to the mechanics of spreadsheet implementation, focusing on how to build a capacity plan that accounts for growth, attrition, and the real-time constraints of a recruiting team. By treating recruitment as an assembly line with specific timing for each stage, Mannion demonstrates how to move TA data out of silos and into executive-level conversations. The episode emphasizes that a simple, transparent model is more effective than a complex one, as it allows stakeholders to see the immediate impact of variables like increased attrition or shifting hiring priorities.
Key Takeaways for Episode 12
Dynamic Attrition Forecasting
Static attrition models often fail because they do not account for the compounding nature of growth; as total headcount increases, a fixed percentage results in a higher volume of backfills that consume "net-new" hiring capacity.
How The Reverse Funnel and Time Studies Impact Headcount
To determine true capacity, TA leaders must conduct time-based studies for every task—from sourcing to scorecard entry—to establish a "theoretical ideal" of hires per recruiter versus the actual output.
A Headcount Model for Hiring Manager Participation
Effective models don't just track recruiters; they forecast the specific hours required from hiring managers and coordinators to prevent interview feedback loops from becoming the primary bottleneck.
Headcount Transparency Unifies Executives Around A Common Goal
When TA leaders present clear data regarding capacity constraints, they distribute the "burden of performance" across the executive team, turning missed targets into business-wide resource allocation decisions
What You Get from listening
Listeners should walk away with a fundamental shift in how they communicate TA performance to the C-suite. Instead of defending recruiting metrics in isolation, you will learn to frame hiring as an "urgency management" exercise where every resource constraint has a quantifiable cost.
Moveing from reactive reporting to proactive variance tracking, allows you to spot potential hiring gaps months before they impact the bottom line. Ultimately, this episode provides the tactical tools to transform your recruiting function into a disciplined, data-driven department that commands the same respect as Sales or Finance.