The Cost of Poor Hiring Decisions
Dream candidate or nightmare? Sometimes the answer is both, when the dream candidate becomes problematic.
The United States Department of Labor estimates the cost of a bad hire may be equivalent to as much as 30 percent of the individual’s annual salary. Quantifiably, a seemingly can’t miss executive making $100,000 a year who doesn’t work out will actually cost your company $130,000. An extra $30,000 may seem high at first glance, but when you factor in the related and not recoupable expenses of recruitment (including travel), loss of productivity while the new employee is brought on, and associated on-boarding costs (such as activation of benefits and work station costs), the numbers grow quickly.
Click here for an even more precise formula. Depending on the structure of your organization, the costs may be even higher.
So what can your company do to reduce the chances of making a poor hiring decision?
- Standardize the interview process – Establishing a baseline process for all candidate interviews enables you to compare interviews along specific criteria. Doing so allows you to measure candidates against each other and the job requirements, which should lead to more concrete hiring solutions.
- Don’t discount personality and instinct – A candidate may have a sterling resume but not fit the culture of your company. It’s a simple fact: Some people are easier to work with than others. If you’re feeling like a candidate is a solid match, don’t let the paper talk you out of it.
- Change your job description – Instead of relying on the outdated method of focusing on “skills and experience”, shift your mindset to one where each job description focuses on metrics to achieve within a period of time. In other words, you ultimately care about whether or not the person can be successful in the job, but today’s job descriptions are surprising devoid of any mention of metrics that should be attained. If measurables are not able to be determined then focus on what the best people do differently than all the rest.
- Contract with a smart, active, executive recruiting firm – Perhaps the wisest decision you can make is to work with an executive search and recruitment firm that specializes in finding the right candidates for your current job openings. At Key Corporate Services, we deliver high-caliber candidates to our clients in line with culture, mission, teams and value. Our rigorous approach to recruiting maximizes our expertise, proven recruiting methodologies, and industry relationships to capitalize on our unrivaled access to, and relationships with, top talent.
Is your company in need of top-notch candidates but unsure how to bring the best people on board? Key Corporate Services specializes in industrial chemicals executive search, pharma & biotech recruitment, food ingredients jobs and management search, finance and accounting recruiting, and manufacturing and engineering job placement.
Contact us today to get started.