Hiring the Wrong Person - A Painful Expense

According to an article in The Economist, unsuccessful hiring is “the single biggest problem in business today.” The Harvard Business Review corroborates that, stating that up to 80 percent of employee turnover is due to bad hiring decisions.

Have you ever made a decision to hire someone whom you later determined was not the right fit for your organization or for that role? 

If so, relax… we’ve all been there. As with any learning experience, the key is to ensure you don’t make the same mistake over and over again.

A costly error

One of the biggest downfalls to making the wrong hire is the financial repercussions for your organization. A study by the Society for Human Resources Management (SHRM) found that the higher up a person is in an organization and the longer he or she remains in that position, the more costly the problem. In fact, fixing things can cost an organization up to five times the annual salary of the person being replaced!

Those are staggering numbers, to say the least. So how can you prevent such a painful expense from occurring within your company? Here are a few words of hiring advice... 

• Look for the right intangibles—behaviors and personality traits that will augment the role. Of course the applicant needs to have the core skill set for the position, but make sure he or she is bringing more than that to the table. For instance, is he a good communicator? Will she thrive in a collaborative environment?

• Know what you want. Have a clear definition of the job responsibilities along with specific personality traits that will be required for success in the role and in your organization. Choosing someone who does not fit the company culture can be devastating to employee morale, which could cause even more turnover.

• Utilize all resources at your disposal. A study from the University of Michigan on predictors of job performance found that the typical interview increased the likelihood of choosing the best candidate by less than two percent. Having a structured interview process that includes the use of an assessment is critical to ensuring a pool of quality candidates and ultimately, a successful hire.

Remember, “A Players” are always in high demand, so it is important to show them why they should choose you. What are the benefits of working for your organization? What separates you from the competition? Is the culture of your organization something to be proud of?

There are already so many expenses involved in making a hire. Be sure to exhaust all of your resources before making a final decision because you will find that most of your initial hiring costs are a fraction of what you will pay later if you hire the wrong person.

Frustrated by high turnover rates?  Perhaps we could be a resource.  Call Sandler Training 423-702-5579 to explore whether or not we could help.