Solutions and Alternatives to Building Your Own ATS

Creating an Applicant Tracking System (ATS) is no small feat.

It’s a process that demands investment in terms of both time and money.

But is it the right path for every organisation?

In this extensive guide, we’ll dive deep into the costs, the alternatives, and the solutions that could save you money and time, backed by solid facts, figures, and statistics.

The Cost of Building an ATS

Let's dive into the cost of building an ATS. 

1. Development Costs

• Hiring a Team: The median salary for a software developer is around $105,590 per year, and building an ATS requires multiple developers.
• Software Licenses: Expect to pay anywhere from $1,000 to $50,000 for software licenses.
• Infrastructure: Hosting and servers can cost between $100 to $1,000 per month.

2. Time Frame

• Initial Development: Typically takes 12 to 18 months.
• Ongoing Maintenance: 15-20% of initial development costs annually.

3. Security and Compliance

• GDPR Compliance: Fines for non-compliance can reach up to €20 million or 4% of annual global turnover.
• Data Security: The average cost of a data breach in 2021 was $4.24 million.

Alternatives and Solutions

A. Off-the-Shelf ATS Solutions

Overview

Off-the-shelf ATS solutions refer to various software vendors' pre-built, ready-to-use applicant tracking systems.

These solutions are designed to meet the everyday needs of most organisations and are often highly configurable to fit specific requirements.

Average Cost

• Free Options: Some vendors offer free versions with basic functionalities.
• Subscription Plans: Monthly subscription plans range from $50 to $400 or more, depending on the number of users and features included.
• Annual Plans: Many vendors offer discounts for annual subscriptions, potentially saving up to 20%.

Features

• Job Posting Integration: Seamless posting to multiple job boards like Indeed, LinkedIn, etc.
• Candidate Tracking: Easy management and tracking of candidates throughout the hiring process.
• Interview Scheduling: Integration with calendars for streamlined scheduling.
• Reporting & Analytics: In-depth insights into hiring metrics and performance.

Implementation Time

• Standard Implementation: Typically takes 1 to 2 weeks for setup.
• Custom Implementation: May take up to a month if additional customisations are required.

Support and Training

• Customer Support: Most vendors offer various levels of support, including 24/7 assistance.
• Training: Onboarding and training for staff are often included or available at an additional cost.

Scalability

• Scale with Growth: These systems are designed to scale with your business, allowing for additional users or features as needed.
• Upgrade Paths: Many vendors offer different tiers, so you can upgrade as your requirements change.

Popular Vendors

• Examples: Vendors like GoHire, Workable, Greenhouse, and Lever are well-known providers.
• Market Share: These products are used by thousands of companies, ranging from small businesses to large enterprises.

Considerations

• Data Security: Ensure the vendor complies with legal and regulatory requirements.
• Integration with Existing Systems: Check compatibility with your current HR or CRM systems.
• Vendor Reputation: Research user reviews, case studies and request references if needed.

Who Should Consider This Option?

• SMBs: Small to medium-sized businesses looking for cost-effective solutions.
• Startups: Those needing to quickly implement an ATS without extensive customisation.
• Organisations with Standard Requirements: If your needs align with common industry practices, an off-the-shelf ATS can provide a quick, affordable solution.

Off-the-shelf ATS solutions present an attractive option for many businesses, offering rich features and flexibility without the hefty price tag associated with custom development.

By carefully evaluating vendors, costs, and features, organisations can find a product that aligns with their unique needs and budget.

B. White-Label ATS Solutions

C. Integration with Existing Systems

Overview

Integration refers to the process of linking different computing systems and software applications physically or functionally to coordinate as a coordinated whole.

Integrating an ATS with existing systems enhances functionality, efficiency, and data management, streamlining recruitment and HR processes.

While offering numerous benefits, integration also presents challenges such as compatibility, security, and cost considerations.

Importance of Integration

• Data Consistency: Seamless integration ensures that data flows smoothly between different systems, maintaining consistency and accuracy.
• Efficiency: Integration eliminates manual data entry and duplication, saving time and reducing errors.
• Enhanced Functionality: By connecting different systems, organizations can leverage the unique capabilities of each, creating a more comprehensive and powerful toolset.

Types of Systems Commonly Integrated with an ATS

• HR Management Systems (HRMS): Enables unified management of employee data, recruitment, onboarding, payroll, benefits, and more.
• Customer Relationship Management (CRM) Systems: Integration with CRM can help in nurturing candidate relationships, improving engagement, and conversion.
• Learning Management Systems (LMS): Syncing with LMS helps in tracking employee training and development post-hire.
• Enterprise Resource Planning (ERP) Systems: Connecting with ERP allows for streamlined financial management, including budgeting for hiring.

Methods of Integration

• API Integration: Most modern ATS solutions offer APIs that allow for direct communication and integration with other software.
• Middleware Solutions: Middleware can serve as a bridge between the ATS and other systems, translating data as needed.
• Custom Development: Tailored integration through bespoke coding may be necessary for highly unique or legacy systems.

Challenges and Considerations

• Compatibility: Not all systems may be readily compatible, and thorough assessment and testing are crucial.
• Security: Ensuring data privacy and security during the integration process must be a top priority.
• Cost: Depending on the complexity, integration may require significant investment in terms of both time and money.
• Vendor Support: Working closely with the ATS vendor can ease integration, as they often provide tools, documentation, and support tailored to this process.

Benefits of Successful Integration

• Unified Candidate Experience: Integration ensures a smooth candidate experience, with information flowing seamlessly from initial application through onboarding.
• Data-Driven Decision Making: By centralizing data, organizations can gain deeper insights and make more informed hiring decisions.
• Streamlined Workflows: Automating the flow of information between systems enables more efficient workflows, allowing recruiters and HR professionals to focus on more strategic tasks.

Examples of Successful Integration

• Integration with Popular CRMs: Many ATS vendors offer pre-built connectors for popular CRMs like Salesforce, enhancing sales and recruitment alignment.
• Syncing with Collaboration Tools: Integrating ATS with tools like Slack or Microsoft Teams can boost team collaboration during the recruitment process.

Integration with existing systems is a critical consideration when choosing an ATS, particularly for medium to large organisations with complex technology ecosystems.

Understanding the specific needs, methods of integration, and potential challenges is key to realising the full benefits and ensuring a smooth, cohesive, and efficient recruitment process.

D. Outsourcing ATS Development

Outsourcing the development of an ATS to a specialised third-party provider is a viable alternative for organisations that need a custom solution without the internal capabilities to create it themselves.

This approach has its own set of considerations:

Development Costs:

• Range: Anywhere from $20,000 to $250,000, based on complexity, features, and specific system requirements.
• Scope: The range and breadth of functionalities can substantially affect the total cost, with more complex features adding up to 40% more.

Time Frame:

• Duration: Development typically takes anywhere from 6 to 12 months, possibly longer for more intricate systems.
• Flexibility: Extensions, changes, and additions can add 10-20% to the timeline and budget.

Customisation:

• Options: Offers nearly 100% customisation, providing a tailored solution.
• Constraints: The more customisation needed, the higher the potential costs, often increasing costs by 30-50%.

Vendor Expertise:

• Selection: Choose a vendor with a proven track record, preferably with a 95% success rate or higher.
• Specialization: Domain expertise can affect the quality, potentially increasing effectiveness by 20-30%.

Maintenance and Support:

• Coverage: May include ongoing maintenance and support, often 15-20% of the development cost annually.
• Future Upgrades: Consideration for future feature additions and technological changes, with a potential cost of 5-10% of the initial development cost.

Integration with Existing Systems:

• Costs: Integration costs can vary greatly, often between $3,000 and $20,000.
• Compatibility: Thorough assessment of existing technology stack for smooth integration, which may reduce costs by 10-15%.

Data Security and Compliance:

• Requirements: Include additional considerations for data security, adding up to 5-15% to the overall cost.
• Standards Adherence: Ensuring alignment with legal and regulatory standards, including GDPR, HIPAA, etc.

Quality Assurance and Testing:

• Investment: Essential for meeting requirements, often constituting 15-25% of the total cost.
• Methodologies: The choice of testing methodologies can affect both timelines and costs, with automated testing potentially saving 20-30%.

Intellectual Property Rights:

• Agreements: Establish clear agreements regarding ownership, which may cost up to $5,000 in legal fees.
• Protection: Ensuring the protection of intellectual assets, often a consideration of 2-5% of the total cost.

Communication and Project Management:

• Essentials: Critical for success in outsourced development, contributing to 10% of project costs.
• Monitoring and Reporting: Implementing regular updates, tracking, and reporting mechanisms, usually 3-5% of the project budget.

Outsourcing the development of an ATS system is a significant and multifaceted decision.

Every aspect, from development to integration and from customisation to compliance, requires a thorough understanding and precise execution.

The potential for success lies in meticulous planning, ongoing monitoring, and a deep understanding of both immediate and long-term organisational needs.

The figures and points above offer valuable insights to any organisation venturing into the outsourced development of an ATS, providing a realistic perspective on both the opportunities and challenges involved.

Let's wrap up the solutions and alternatives to building your own ATS

Building an ATS is an expensive and time-consuming process, with the potential costs extending well into six figures.

It's a decision not to be taken lightly, especially when considering the availability of various cost-effective and time-saving alternatives.

Companies spend an average of 43 days to close a new hire, but with the right ATS, this can be reduced by up to 50%.

By examining the facts and figures, weighing the benefits against the costs, and considering the alternatives, businesses can find a solution that fits their unique needs without the overwhelming burden of building an ATS from scratch.

Whether you're a startup looking to scale or an established enterprise seeking efficiency, these alternatives offer a pathway to success in the ever-competitive world of recruitment.