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Applicant tracking systems - explained!

Updated: Mar 24

You’ve probably heard the term ‘ATS’ before during your job hunt. It stands for ‘Applicant Tracking System’. Why is that important? Well, because there’s a lot of misinformation out there concerning what it is and what it can do. I see misconceptions every day about this technology, and I’m hoping to clear them up in this post.

What is an ATS?

It’s a tool used by employers to help them streamline the hiring process by collecting and storing applicant information - think of it like a spreadsheet database.

When you submit your resume through an online job portal, that information is collected and sorted into this “spreadsheet” which recruiters can then use to find you. It “tracks” applicants, hence the name applicant tracking system.

There are many ATS platforms out there

Literally hundreds. Like any other software you use, there are many companies out there that make ATS. A few of the biggest ones are:

  • Taleo

  • SmartRecruiter

  • iCIMS

There are also a lot of smaller, less known ones too. The point is that when you hear the term ATS, it’s not referring to one thing. Each one of those ATS I mentioned above (and all the others out there) are designed to do similar things but are also very different from one another. A couple of examples of how one ATS can differ from another:

  • They may work best with different file formats. One system may work best with docx file formats while another may work best with PDF.

  • Their language processing ability differs (i.e., the technology that scans the content in your resume). One system may need you to match what’s on the job posting verbatim while others may be able to recognize different forms of the same word (i.e., write vs. writing).

Companies can customize ATS to fit their business and hiring needs. An ATS at a company like Pepsi will work differently than the same one at Nike, because each one will have been configured differently. Examples of how companies can customize an ATS:

  • Dashboards displaying different stats and metrics. Companies can configure their ATS to display different views depending on their needs.

  • Job requirement criteria and weighting. Companies can set the criteria for the positions they’re trying to fill and also give them different degrees of importance to the job in a points-based system (for example, a web developer job posting might have very high importance placed on the ability to work with Javascript, but lower importance on being a team player, despite both terms are present in the job posting).

To understand an ATS better, it helps to understand the process a recruiter follows from job opening creation to hiring. The process can be broken down into three basic steps (the process is a bit more complex than what I’ve outlined below - this is for illustrative purposes only).

  • Step #1 Position is created.

  • Step #2 Applicant, Screening and interviews

  • Step #3 Job offers and Closure

At each step of the way, the ATS document everything, from when a candidate applies to when an offer is extended. Here’s a non-exhaustive list of the actions recruiters might take any given day:


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Step 1 - Creating and Publishing the Job Ad

Simplified version of the process: Software Company X wants to hire an engineer for the awesome new product they’re working on. Typically for companies with internal Human Resources, management will let HR know they need a new engineer. HR will then create the job opening in the ATS and publish it on their company job portal - it may also get cross-posted to other sites like LinkedIn, Indeed, Glassdoor etc.

Step 2 - Applicant Intake, Screening, and Interviews

Once the posting is created and applications start coming in, recruiters review them based on the qualifications laid out in the job posting. In some cases, we’re talking reviewing hundreds of applications for a single posting.

This is where the ATS can make the recruiter’s life easier by filtering out candidates based on qualifications. This is also where “knock-out” criteria come into play - criteria that the applicant must meet to be considered for the position. Applicants that do not meet these criteria are automatically “rejected” and sometimes, an automated rejection letter is sent out (sometimes right after the person applies).

Some ATS have ranking features that score the candidate based on how well their resume matches the job posting. However, not all companies use this feature and even when they do, they frequently hire applicants with match rates of less than 40%. Applications that score higher (70-100%) are often keyword stuffed and not very useful (a big reason why you shouldn’t put too much weight on online resume scanners like JobScan, which are in fact not very useful).

Once the recruiter completes their review, shortlisted candidates will be forwarded to hiring managers and sometimes other personnel for further review and approval, after which, interviews are typically requested.

Step 3 - Job Offers and Closure

Applicants that are successful in the interview process (that could consist of one or multiple interviews) are then extended offers, which often consist of extending the offer, negotiation, and that sort of back and forth before the offer is either accepted or declined.


How to beat the applicant tracking system?

How do beat the ATS?

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About the Author

James Cooper is a Professional Resume Writer, member of the Professional Association of Resume Writers & Career Coaches (PARWCC) and has been in the recruiting, career coaching, and writing business for almost 14 years. He began his career recruiting for AECOM, a Canadian engineering firm, and he's gone on to work with and help professionals land roles at top Fortune 500 companies.

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