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What Is ATS (Applicant Tracking Software)?

As your company grows, you often need to streamline your processes and automate manual tasks, which is where applicant tracking system software (or ATS) comes into play. Using applicant software not only gives your human resources department more time to focus on more impactful tasks, but it can also help you hire the right people by identifying the candidates who match your requirements for your open roles.

Below, you can learn more about applicant tracking systems, including what ATS software is and the pros and cons of implementing ATS software in your business.

Did you know? Indeed’s ATS Sync enables employers like you to sync jobs, candidate applications and disposition signals between Indeed and your ATS. This helps simplify the hiring process for both you and your candidates.

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What is ATS?

What is ATS? Applicant tracking system software gives you a variety of tools to automate many parts of the recruiting and hiring process. It streamlines the hiring process, making it easier and faster for recruiters and managers to find the most suitable applicants. From posting jobs and sorting through applications to pinpointing the most promising applicants, ATS software can perform many tasks automatically, so an HR representative doesn’t have to.

Indeed partners with 300+ ATS platforms across the globe to make hiring faster and easier. Check out our full list of ATS integration partners. You can also search for your ATS in Indeed’s Integration Hub (sign in required).

Functions of applicant tracking systems software

The primary function of an application tracker system is to store and manage the resumes you receive in response to job ads. You can access those applications at any time, but ATS applicant tracking systems also offer additional functions that can help with the candidate selection and management process.

Common functions that an ATS can perform include:

  • Posting the same job listing to multiple job boards the ATS is integrated with
  • Reviewing information, which often includes keyword searches, uploaded by candidates to identify those who most closely match the job listing requirements
  • Transferring applicant data from one location of the system to the next as an applicant goes through the hiring process
  • Allowing recruiters and hiring managers to send candidates automated messages when applications are received
  • Scheduling different parts of the hiring process with candidates
  • Sending paperwork to a candidate who accepts a job offer

Related: Tools for Recruitment: 3 Ways to Efficiently Hire Employees

Benefits of applicant tracking systems

An application tracker system can help your HR department in many ways. Here are a few benefits of using applicant tracking software:

Reduced time spent on repetitive tasks

Because ATS software performs many administrative tasks associated with the hiring process, using it can give your HR team time to focus on more important functions. For example, common tasks that can be automated by ATS software include scanning resumes, determining where candidates found the job listing, email marketing, candidate tracking and organizing candidate information. HR employees can spend more time evaluating the resumes the system ranks as top matches for interviews.

Faster applicant screening

Applicant tracking systems can significantly reduce the amount of time spent on screening applicants. They do this by automating the screening process, only allowing applicants who meet set criteria to pass through the system.

Here’s how it works: You input certain role requirements, such as education level and skills, into the ATS, and then the applicant tracking software scans incoming resumes for those specific requirements. When the ATS parses a resume and determines it meets your requirements, it automatically moves that applicant forward in the hiring process.

Did you know? You can post your jobs on your ATS and get instantly matched with Indeed candidates using Indeed Recruiter Extension. You can also quickly check the visibility and sponsorship status of your ATS jobs on Indeed.

Easy communication regarding applicants among hiring managers

Many applicant tracking systems allow hiring managers to include notes and ratings related to each candidate they interview. This information can then be shared with other hiring managers or interviewers for easy communication and collaboration throughout the hiring process.

With Indeed Recruiter Extension, our free Chrome browser extension, you can stay in touch with your Indeed candidates from your Chrome browser.

Improved application process

An ATS can also streamline the application process and improve the candidate experience. For example, this software allows candidates to upload their information directly from their online professional profile, which means they aren’t required to re-enter that information multiple times.

Additionally, because ATS software is often set up to notify candidates when their applications have been received and whether they’re being considered for the position, applicants can remain up-to-date on their status with a particular company and move on when necessary.

Indeed’s ATS Sync integrations allow you to easily access Indeed’s tools with a simplified candidate experience that helps deliver up to 5X more completed applications.¹

¹Indeed data (WW), Tracking on non Indeed Apply applications may be limited

Fewer mistakes and missed opportunities

Doing any task manually introduces the risk of human error. When screening resumes manually, you might miss important details that could determine how qualified a candidate is. This could cause you to interview someone who doesn’t meet your requirements or skip someone who’s very well-qualified.

With Indeed’s ATS integrations, you can spend less time switching between systems and performing manual data entry tasks. This allows you to accomplish more in less time and reduce the risk of human error.

Access to recruiting and hiring statistics

Applicant software systems typically provide you with statistics on various aspects of the process. The software records information that can help you evaluate your processes and set goals to improve them. The statistics you get can vary based on the program you choose. Find out what information you’ll get about the applications and your hires from the system to find one that gives you robust data.

Related: General Guidelines for Job Application Forms

Drawbacks of using ATS software

Along with the benefits, there are a few potential disadvantages of using ATS software. Understanding these drawbacks can help you make a more informed decision when deciding to integrate an applicant tracking system into your organization’s hiring process.

Overlooking qualified candidates

Because ATS software scans candidates’ information for set keywords and other relevant information in a job listing, the software may discount a qualified applicant who doesn’t have these keywords in their application. For example, an applicant making a career change may have little previous experience directly related to the job, but they may still be a viable candidate because of their transferable skills.

Learning complicated systems

These software systems can be very complex and take a long time to learn. Until your HR employees master the system, they might not use it to its full potential, or they might cause unintentional errors. Some employees also might not want to learn something new if they’re comfortable with your current methods.

Technology failures

As with all software, applicant tracking systems can occasionally malfunction or have issues. For example, ATS software may reject a resume that’s not in the format it’s been set to recognize, which can result in candidates’ applications not being seen by hiring managers.

User errors

Most ATS software requires manual setup. For example, the hiring manager may be required to insert the desired keywords into the system before it can scan for those keywords on applications. If a keyword is accidentally misspelled, the ATS software won’t pick up on the right keyword, and good candidates could be missed.

Added costs

If you’re on a tight budget, buying the software can be a challenge. Cheaper options typically have fewer features, so a system that matches your budget might not offer everything you need. However, you can save on labor costs by easing the workload of the HR department.

FAQs about applicant tracking software

How does Indeed work with my applicant tracking system?

Enhance your ATS experience with smart features from Indeed that increase your productivity and responsiveness. Indeed’s ATS Sync seamlessly transfers job and candidate data between Indeed and your ATS to make hiring faster and easier. We integrate with 200+ ATS platforms in the US, so you can spend less time going back and forth between systems and more time hiring. Get started on Integrations Hub, Indeed’s one-stop solution where you can discover, activate and manage integrations between Indeed and your ATS.

What file types do applicant tracking systems recognize?

Most ATS software will readily recognize Word documents, such as .docx and .doc files. Many applicant tracking systems will also accept plain-text resumes. However, because many candidates choose to submit their resumes in PDF format, you should select ATS software that can also read PDF files to ensure all candidates are properly screened. When creating your job postings, list the specific formats your program uses as the required formats for resumes and other documents to avoid issues.

What does resume parsing mean?

Many applicant tracking systems are equipped with resume parsing software. This refers to the software’s ability to extract important information from candidates’ resumes—even when the resumes are formatted differently. For example, one applicant may list their skills at the end of their resume, while another may integrate their skills into their experience section. Resume parsing allows ATS software to detect these skills, no matter where they are on the resume, ensuring all candidates are evaluated the same way.

Do all companies need an applicant tracking system?

You can handle your recruiting process without ATS applicant tracking systems, but it’s more time-consuming and complicated. Doing everything manually requires an HR employee to spend a lot of time sifting through resumes and staying focused to avoid missing good candidates. Most businesses that hire regularly can benefit from time savings, which typically translates into cost savings since you’re cutting labor costs. However, it’s up to you to determine if ATS is right for your organization. Indeed offers integrations with most global ATS platforms.

How do you choose the right software for your company?

Before you search for the right ATS, evaluate your HR needs. Set your software budget to narrow the search. Evaluate information, such as how often you hire, how many employees you hire each year, what you want to look for in software and the extra features you need. Review all features and details of each ATS you’re considering to find one that matches. Looking at third-party reviews can give you an unbiased evaluation of the product. Many software companies offer free demonstrations or free trials to let you test out the features. Check the terms of the agreement to see if you can stop using the software if it doesn’t work for you. It’s often difficult to tell how well a product will meet your needs until you start using it.

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