Dear Amal,
ROI = The final net profit of the company The final net profit of the company ÷ Total overall costs including employment, advertisements and loans
The final net profit = Total revenue - Total costs
Example: If we have to spend $ 3,000 a month on the company's advertising, wages and incentives and general expenses ..And we got in return on the $ 2,500 returns
ROI = (3000 - 2000) ÷ 2000 = 50%
by
Samar Abu Shaban , Regional HR Operations manager , souq.com
Hi Amal,
Actually calculatng ROI on recruitment is a complicated process and most organisations don't produce such type of reports.
We can calculate an approximate ROI for incurring costs that are designed to contribute to staff retention and recruitment.
For example place ROI on the value of a staff medical plan.
- what is the cost of the plan?
- ask employees to rank the importance of a company mediacl plan; how many your staff think this is important for them.
- calculate employee cost to profit
(senior employee payroll expense x profit) / total employee payroll
- now you have the value of your seniior staff by virtue of what you are paying him.
- apply the results of the medical benefits survey. this will provide the influence of the proposed scheme.
- consider the cost of replacing the senior staff; recruiting cost. you will have direct correlation between the influence value of your benefit scheme and the cost of saving represented by not incurring recruiting costs.
- the difference between both is the ROI which is the expense of the medical benefit scheme that you are going to deliver by virtue of its value.
