What is ATS (Applicant Tracking Software)?

Company growth often comes with a need to streamline processes and automate manual tasks, which is where applicant tracking systems (or ATS) comes into play. But using an ATS not only gives your human resources department more time to focus on more impactful tasks — one can also help you hire the right people by identifying the most qualified candidates for your open roles.

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

What is an ATS?

Applicant tracking system software streamlines the hiring process, making it easier and faster for recruiters and managers to find the most suitable applicants. From posting jobs to sorting through applications to pinpointing the most promising applicants, ATS software can perform a number of tasks automatically so that an HR representative doesn’t have to. An ATS works by:

Posting the same job listing to multiple job boards that the ATS is integrated with
Reviewing information uploaded by candidates to identify those that 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

Benefits of applicant tracking systems

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 one can give your HR team time back in their day to focus on more important aspects of finding the most qualified candidates. For example, common tasks that can be automated by ATS software includes: scanning resumes, determining where candidates found the job listing, email marketing, candidate tracking and organizing candidate information.

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 that meet set criteria to pass through the system.

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

Easy communication regarding applicants among hiring managers

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

Improves 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.

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. Potential drawbacks include:

Qualified candidates may be overlooked. Because ATS software scans candidates’ information for set keywords and other relevant information listed in a job listing, the software may discount a qualified applicant that doesn’t have these keywords in their application. For example, an applicant who is making a career change may have little previous experience directly related to the job, but may still be a viable candidate because of their transferable skills.
Technology can malfunction. As with all software, applicant tracking systems can occasionally malfunction or have issues. For example, ATS software may reject a resume not in the format it has been set to recognize, which can result in candidates’ applications not being seen by hiring managers.
User errors can negatively impact how the system functions. 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 these keywords on applications. If a keyword is accidentally misspelled, the ATS software will not pick up on the right keyword and good candidates could be missed.

ATS FAQs

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 resumes that are plain-text. However, because many candidates choose to submit their resumes in PDF format, you should choose ATS software that can also read PDF files to ensure all candidates are properly screened.

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.