ATS vs. CRM: what’s the difference and do you need one (or both)?
Joanna Oakley CCWP MCIPD
I help recruitment agencies save money & improve candidate experience by achieving operational efficiency and scale through tech optimisation, process transformation, and strategic growth initiatives. Fractional COO
This is quite possibly my most frequently asked question when it comes to recruitment technology.
And like with many terms in the recruitment industry, the use of the word ATS quite often gets incorrectly applied to other tools, one of the most common mistakes is classifying a recruitment database or CRM (which I will cover below) an ATS, however, that's not to say a CRM cannot have some ATS capability.
Below I have done my best to outline the key functionalities of both systems, how they differ and whether you might need one or both of these tools as part of your recruitment agency tech stack.
Introduction
An Applicant Tracking System (ATS) is a type of software that automates and facilitates the hiring process from job postings to onboarding. It optimises talent recruitment and improves the candidate experience. On the other hand, a Candidate Relationship Management (CRM) system focuses on building relationships with potential and current candidates, creating a talent pool for the company.
When it comes to ATS vs CRM, both tools can help streamline, arrange, and maximise the recruitment procedure. Still, recognising when, why, and how to combine them into a talent acquisition strategy is essential to achieving their full potential.
To distinguish between an ATS and CRM, let's start by delineating each one, and then proceed to analyse their similarities and differences.
What’s an ATS?
An applicant tracking system (ATS) is recruitment software designed to streamline, optimise and automate the hiring process for recruiters, HR professionals and hiring managers when it comes to recruiting permanent employees (i.e. not temporary or contingent labour workers).
An effective ATS simplifies every part of the talent acquisition workflow from beginning to end by using automation to simplify tasks like administering skills assessments, collecting metrics, setting up interviews, sending follow-ups, performing background checks, issuing job offers and onboarding.
Using an ATS as a tool during the recruitment process not only improves the candidate experience but also makes it easier for hiring professionals to identify and acquire top talent.
Automation helps keep the entire recruitment life cycle organised and efficient, while enhancing communication among stakeholders, reducing time-to-hire and allowing hiring professionals to focus on finding the best fit for their open roles.
Why do I need to use an applicant tracking tool?
Once someone applies for a job, their information is automatically fed into the ATS system for the next step in the process. The ATS helps recruiters or hiring teams manage applications quickly and give candidates a personalised experience while also handling many applicants at once. Here are some of the advantages of using an ATS:
*Deal with high volumes of permanent recruitment or considering an RPO provider.
No matter whether you’re freezing, furloughing or ramping up, talent scalability is essential. The best option for getting a lot of applicants from ‘apply’ to ‘offer’ is with an ATS. Automated recruitment processes and powerful analytics let you move suitable candidates from application to offer and complete background, reference and employment history checks before making an offer.
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*Decentralising recruitment
Many large firms shift some of their recruitment duties to create better connections between recruiters and hiring managers. It speeds up decision-making, eases workflows, and gives the candidate experience a personal touch.
What’s a CRM?
Customer Relationship Management (CRM) is also known as Candidate Relationship Management when used as a recruitment marketing tool. Recruitment CRM software is designed to construct a talent database of job seekers, current employees, and passive candidates that recruiting teams can use for recruitment and hiring activities.
For recruitment agencies, a CRM will also enable business development, capture all client interactions and engagements as well as facilitating client marketing campaigns. It is important to note that a CRM is suitable for both permanent and temporary candidate recruitment.
CRM software helps staffing organisations engage and foster talent throughout the hiring process. It enables recruiters to maintain relationships with candidates via SMS job alerts, emails, and automated nurture flows. Companies may even use chatbots to help people find answers to questions about roles or salary expectations.
Proactive recruitment includes advertising on social media platforms and reaching out to prospective employees one by one. However, it also involves guiding potential hires in the right direction while keeping them interested and informed. This requires an AI-powered content management system that allows companies to create and modify job listings and feature their EVP and employer brand with dedicated landing pages.
When a passive candidate expresses interest, the CRM software acts as a record of that person’s details so they can be contacted when the right position becomes available. This efficient approach can help create and sustain a talent pipeline, leaving recruiters more time for activities that contribute to better candidate experiences.
Candidate relationship management platforms generally incorporate the following features:
A CRM is an instrument for building and maintaining relationships with talented individuals, creating a source of qualified prospects to choose from that can be easily managed. An existing pool of candidates decreases or eliminates the need for a recruiting agency, boosts the quality of applications for open positions, and expedites time-to-hire.
Should you integrate your CRM with an ATS?
Although ATS and CRM software overlap in services provided, they are two different tools with separate functions. The purpose of an ATS is to organise and coordinate the application and hiring process, while a CRM system keeps records and facilitates communication between recruiters, potential hires and the end client.
Integrating a CRM with an ATS forms a tech stack that automates and streamlines the talent acquisition process. This allows recruiters to source candidates from their own database as well as find new applicants outside of it.
When using both systems together, job seekers go through the hiring workflow managed by the ATS, from which the best candidate is chosen by the hiring manager. The remaining candidates stay connected via the CRM for future job openings, making for an efficient recruitment cycle.
From a candidate’s perspective, having an organised recruitment pipeline with visible steps and quick responses helps build trust with applicants. This gives your company an edge over the competition in a saturated job market.
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