What is an Applicant Tracking System?

Author Nico Roberts Date 22 Apr 2019

Never underestimate the impact of sourcing and hiring the right candidates on the success of your business. Although hiring the right candidate is a very important aspect of business, it can be very frustrating for those involved. HR Directors, hiring managers and recruiters all have to figure out how to get the best candidates while reducing the time to hire. Unfortunately, the software that was previously designed to help streamline the hiring process has not kept up with the times. However, with modern hiring software, the recruitment process has been transformed from a process that was full of frustration into one that best serves the needs of businesses.

A small business applicant tracking system has long been seen as one of the technologies revolutionizing how businesses recruit and retain applicants. A survey has found that 98% of Fortune 500 companies already use an applicant tracking system. Additionally, more small and medium-sized businesses are using these systems to sort out resumes to ensure that they end up with the right candidates.

What is an applicant tracking system?

Define applicant tracking system: An applicant tracking system for small businesses is a type of software that businesses use to collect, scan and rank job applications in order to source candidates. They are becoming increasingly common, being used by businesses of any size to streamline the application process.

Why do companies use an applicant tracking system?

With more people applying for jobs online, using a small business applicant tracking system is even more important because more people might simply apply for a job because they can. Employers need a way to sort out the serious applicants from those who are just applying because they just want to give it a shot. An SMB applicant tracking system helps to retain all of the resumes that are received from open job applications in one place. This helps recruiters to manage the candidates in a more systematic way.

In theory, an applicant tracking system for small businesses is meant to help the best candidates rise to the top while filtering out the less suitable candidates. However, unless you use modern hiring recruitment software along with an applicant tracking system, this very rarely happens because sometimes the best candidates can slip through the cracks.

How do applicant tracking systems work?

At the time a candidate applies for a job online, either through free job boards or paid platforms, important information like contact details, educational background and experience are uploaded into the database. This information can be transferred from one part of the small business applicant tracking system to another as the candidates progress through the hiring stages. Essentially, applicant tracking systems collect and keep resumes accessible for recruiters.

It is not uncommon for resumes to be kept even after the job that the candidate has applied to has been filled. This enables recruiters to fill the talent pipeline so they can find suitable candidates for different job openings at a later date.

The following are ways that recruiters use applicant tracking systems:

1. Use recruiting applicant tracking systems to view applications

Depending on how many candidates have applied for a role, some recruiters take it upon themselves to review every single applicant. This may only be done in a cursory way. They may just have a brief skim of the resume to see if anyone jumps out at them. Therefore, using an applicant tracking system for small businesses, they can go through resumes manually to make a decision as to whether that person should progress to the next stage.

2. Use small business applicant tracking systems to rank resumes automatically

Some applicant tracking systems for SMBs with advanced features can compare the resumes that have been submitted to the details in a job vacancy. A score is then provided to let the recruiter know how well the submitted resume matches the job description. Essentially, an applicant tracking system for small businesses is a gatekeeper to help recruiters make the right choice. It accepts resumes and then scans them for specific keywords that have been provided by the recruiter to help decide whether the application should go to the next stage.

The main function for a small business applicant tracking systems is to save recruiters time by getting rid of unsuitable and unqualified applicants. Therefore, the recruiter has more time and can apply more effort to honing-in on suitable applicants.

Benefits of using an applicant tracking system

1. Process tracking is a benefit of using an applicant tracking system

An applicant tracking system for small businesses provides important information to the recruiter as to where candidates found the job listing, i.e. whether free job boards were used or whether the candidate applied via social media. This is important data for recruiters to collect so that they can focus their efforts and resources into the best channels that bring them the biggest returns and the highest quality applicants.

2. Streamlining processes is a benefit of using an applicant tracking system

An applicant tracking system organizes information in a systematic way, which helps recruiters to handle and manage information more efficiently. There is no need to waste time sorting through applications because everything is ordered in a way that recruiters can find applications based on the criteria they suggest. This saves both time and money.

An applicant tracking system for small businesses is also beneficial for applicants in terms of saving time. Most applicants can upload their data at the click of a button. They do not have to re-enter information all the time. They can use pre-existing resumes or applications to re-apply to other positions.

3. Compliance is a benefit of using an applicant tracking system

If you have a business in the US and you employ 15 people or more, you are legally required to comply with the regulations that have been set by the Equal Employment Opportunities Commission (EEOC). Part of the EEOC’s remit is to enforce employment discrimination laws at the federal level. Some of these duties include tracking the hiring data of businesses and also dealing with complaints from employees who believe that they have been discriminated against. Using a recruiting applicant tracking system, you can automatically collect the data that is required by the EEOC to show that your business is complying with all relevant laws and regulations.

Problems with  applicant tracking systems

Although some applicant tracking systems are reliable, there can be some problems when relying solely on this type of system for your recruiting needs.

The first problem with applicant tracking systems is that some are made to filter out resumes by specific key words, educational backgrounds and experience may miss the qualified candidates who accidentally slip through the net.

Technical issues can also be a problem when using an applicant tracking system. For instance, if an applicant has loaded a resume in PDF format, it will be unable to read the wording and it will therefore discard the resume. A resume can also be discarded if it is in a different format than what the applicant tracking system is used to, even though the candidate has all the relevant experience and skills for the job.

Resume formatting for applicant tracking systems

There are many websites and job providers that give information to candidates about how to format their resumes correctly to get through the applicant tracking system.

Here are some of the tips that are provided to candidates to ensure that their resume goes through an applicant tracking system:

1. Avoid using PDF when submitting your resume through a recruiting applicant tracking system

If a candidate wants to make an application, they should avoid using PDF versions of their resume (even where an applicant tracking system says that PDFs are accepted). It is better to be safe and use a document in a .DOC or .DOCX format. Additionally, candidates may want to use plain text files because they can be easily read by a small businessapplicant tracking system. However, if an applicant is using a plain text file, although it may get through the applicant tracking system (ATS), the formatting may put the human recruiters off. Therefore, it is recommended that candidates use a Word document that will be able to get through the applicant tracking system and will also be formatted in the way that a recruiter is expecting.

2. Use headers and footers with caution to best get through an applicant tracking system

Some applicant tracking systems are unable to read information that is placed in the header or footer of a Word document. Therefore, candidates should try to avoid putting important information there, like their name or contact details to get through as best as possible in an applicant tracking system. Although it could be seen as a space-saving exercise to put information in the header, this may cause problems with applicant tracking systems, so it is best for candidates to put all important information in the actual body of the Word document in their resume.

3. Use bullet points for best applicant tracking system format

Bullet points are a great way for candidates to highlight their experience and focus on the job description keywords. In terms of formatting bullet points to get through an applicant tracking system, it is recommended that candidates use only plain bullet points and no fancy characters. The more intricate character, the more difficult it will be for the applicant tracking system to read.

4. Use keyword optimization to improve your applicant tracking system format

When applying for certain jobs, there are some keywords that will automatically be flagged up by the best applicant tracking systems to forward the resume onto the next stage. Candidates can research which keywords will be necessary for the jobs by studying different job descriptions.

5. Avoid using charts and images when formatting for applicant tracking systems

Even though adding graphics, images and charts may make your resume look better, applicant tracking systems are unable to read graphics and images. Therefore, these images will be of no value to your application unless you describe them very thoroughly using relevant keywords.

6. Do not over-focus on resume formatting

Using appropriate keywords is the most important concern for candidates who are trying to get their resume through an applicant tracking system. Some applicant tracking systems filter the resumes into digital files to make all the information look the same. Unfortunately, if a recruiter is using an out-of-date applicant tracking system, reformatting candidates’ resumes can result in information being lost and jumbled.

In order to deal with the issues and problems with applicant tracking systems, your business should consider using modern recruitment software to get all the functionality of the best applicant tracking systems without the outdated technology that results in muddled resumes and the potential loss of qualified and suitable candidates.

When using recruitment software designed for modern recruitment needs, you will be able to source and fill vacancies more efficiently.

Modern recruitment software also allows you to track your applicants and gives your recruiters the capability of handling more applications for each person.

For instance, The Turas Group was able to handle nearly 2000 applicants per recruiter when using Fountain’s modern hiring software. Recruitment software, which has applicant tracking systems, will be able to provide the functionality for a complete end-to-end hiring process, which includes quickly and easily posting jobs to several platforms, whether free or paid.

An example of this is Fountain’s Boost, which ensures that you can source the number of candidates you want at a single click of a button.

Sign-up now to find out how you can use Boost to get the right candidates faster, create the best experience for candidates and for hiring managers.

Fountain also provides accurate analytics about different aspects of the hiring process so that your business can react to development areas to ensure that important metrics, like time to hire, is being reduced.

Give the applicants the best experience with your applicant tracking system

If your company fails to provide a positive recruitment process for candidates, they may simply move onto the next company because of the low unemployment rate.

Recruitment software built for the modern age has the following functionality to improve the recruitment process:

  • A mobile-ready interface so that candidates can apply and track their information using their mobile devices.
  • Automation that enables seamless communication with thousands of applicants at one time.

Traditional applicant tracking systems may be lagging behind the developments taking place in the hiring world. They may be ill-equipped to deal with emerging factors, like the gig economy and contingent workers.

If you have used an applicant tracking system for a number of years, it could be time for you to review your system and make a switch to software that is more suitable to your needs and will:

  • Increase efficiency in your hiring process.
  • Reduce recruiter frustration.
  • Provide a better candidate experience.

Try Fountain today to find out how we can give your business the best of both worlds.



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About the Author

Chief Business Officer

Nico Roberts

Nico Roberts is the CBO (and employee #3) at Fountain. He has worked with many global Fortune 1000 companies, helping them standardize and scale their high volume operations and hiring practices.