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5 KPIs Your CRA Must Hit to Beat the Competition in 2021

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Most of us would rather forget 2020 even happened, but unfortunately, it did, with implications for the economy as a whole, nationwide hiring, and the employment background screening industry, in particular. As unemployment spiked during the COVID-19 pandemic, the demand for background checks — previously on a strong upward trajectory — plateaued.

But all that is changing. The American economy is gaining strength, unemployment is dropping back toward its pre-pandemic level, and companies are hiring again.

Employers will want to ensure they have reliable people in place to help them recover quickly. As a result, consumer reporting agencies (CRAs) should expect high demand for employee background checks throughout 2021 and beyond.

(As we reported last year, in the 21st-century hiring landscape, nearly every organization conducts some form of pre-employment background screening.)

But there’s a crucial caveat: Sky-high demand comes with intense competition. Nearly 2,000 background screening companies are jockeying for business from the same pool of end-users.

How can you position your CRA for growth and profit during the post-COVID hiring boom?

With so many CRAs to choose from, employers are in the driver’s seat. Here are the five performance characteristics background check end-users value above all:

1. Accuracy

There is very little room for error in a background check report.

Just one missing conviction can expose an employer to a considerable amount of risk. For example, if a truck driver causes an accident after their license has been suspended for a DUI, the driver’s employer could face severe fines and draining lawsuits.

Employers also want to avoid replacing an employee after they’ve already been onboarded — an expensive and productivity-killing undertaking that can cost as much as twice the employee’s salary.

End-users demand near-100% accuracy from their CRAs. And given the sheer number of CRAs to choose from, it’s easy to understand why an end-user would see no reason to tolerate mistakes.

2. Turnaround Time

Turnaround time is everything to an employer.

It’s not merely impatience that drives end-users to prioritize turnaround time above every other KPI. The longer an end-user must wait for a completed criminal background check, the longer they must endure unfilled seats in their organization — the thinner they must stretch their overburdened current employees.

Employers pay attention to two metrics that measure turnaround time:

  • Turnaround time for hits. How long it takes to report on a search that results in a criminal record.
  • Clear turnaround time. The time required to report on a background check that found no criminal records.

Typically, hit turnaround time will be longer, as it involves gathering, transmitting, and formatting data. This is why an average of the two metrics will fail to tell the whole story.

Another related metric end-users scrutinize closely is estimated completion data accuracy (ECD accuracy). In other words, how trustworthy are your estimates? If you say it will take three days to complete a search, will it actually take three days (or, ideally, less)?

In fact, as long as the turnaround time is reasonable, many employers care more about ECD than they do turnaround time. Accurate estimates help end-users make plans and set timetables. On the other hand, poor estimates cause disruption and may make end users look bad to their customers.

3. Customization

Every employer has a different business model, a different set of customers, and different tolerances for risk. Therefore, every employer may have different requirements regarding the format of their background check results and the information included. end-users often ask CRAs to customize their background checks to suit their own unique specifications.

Here’s an example:

In some states (such as Minnesota), a speeding ticket is considered a “petty misdemeanor.” Naturally, many employers will not want to rule out promising job candidates simply because they’ve acquired a few speeding tickets. But if the CRA treats all misdemeanors as equal, this is exactly what might occur.

Conversely, if driving is part of the job, the employer might be very interested in traffic infractions. It is the CRA’s responsibility to understand their end-users’ needs and tailor their reports to accommodate those needs.

4. Transparency

These days, when a single lawsuit can put a company out of business, or a single rules violation can lead to hundreds of thousands of dollars in penalties, employers cannot abide their vendors being black boxes.

Employers need to be able to follow the background screening process from start to finish. And when auditors or lawyers come calling, employers need to demonstrate where they got their information and how, with complete documentation recording every step along the way.

5. Cost-Effectiveness

You might be surprised that we didn’t rank affordability at the top of this list of capabilities and KPIs end-users look for in a CRA. All things being equal, organizations will consider cost when comparing vendors. But when it comes to background checks, all things are rarely equal.

As we’ve argued above, bargain-basement background checks aren’t worth much if they’re riddled with errors, too slow, or lack the customization options end-users require — in fact, they may cost end-users more money than they save.

Successful CRAs optimize their processes to minimize their expenses and pass the savings onto their end-users, but without sacrificing quality, accuracy, and reliability.

Give Your CRA a Performance Boost

If your CRA is struggling to earn or retain business, you’ve likely fallen behind in one, several, or all five of these areas. How can you catch up to, and ultimately surpass, the competition? Our new ebook for CRAs explains how: by getting close to the data.

Getting close to the data means breaking down barriers between you, your end-users, and the direct sources of criminal records. Getting close to the data means taking complete control of timing, eliminating extra steps that invite errors and elevate costs, and gaining the flexibility to offer more customization options.

Learn more in “How SJV Improves Turnaround Time and Accuracy by Getting CRAs Closer to the Data.

 

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