What Can Be Done About Them?

One business owner made three bad hires in a 26-month period. The total cost of the exercise was over $210,000. This cost did not include the hidden cost of poor client relations, internal employee damage, or disruption created by these individuals. Why is it getting harder to hire good people? 

According to JOLT, a sub-section of the Bureau of Labor statistics, which stands for Job Openings and Labor Turnover there is a lot of hiring taking place. Stay with me here. The number of open positions in the US between January and December 2016 has average around 5,500,000. These positions range from entry-level positions at McDonald’s to a VP of Sales at Comcast in Philadelphia. With all these open postings across the US, how will hiring managers and business owners minimize the cost of bad hires

One tool that has proven effective is the use of competency assessments. Whether you are hiring an engineer, a doctor, a manager or a CEO you need to know as much about their soft skills, like behavior and tendencies, as their hard skills. Hiring rarely yields a 100% perfect fit, but you can improve the odds. A typical hiring process involves just three steps: an online posting, the interview with a good “gut” feeling about a certain candidates then, finally, the offer. Sounds simple, doesn’t it? For most company’s this process has a very low rate of success.

Consider an alternative process.

  1. Create a job description with clear responsibilities and requirements
  2. Post the open position on a job boards that specialize by job types: Sales, Operation, Finance, Management, etc.
  3. Use an assessment tool prior to any phone or face-to-face meeting. Some assessments will link to your website as part of the process. As you receive resumes, require all candidates to complete this assessment.
  4. Set the minimum score level on the assessment to show only those candidates who scored at or above this level.
  5. Narrow the focus to the highest score candidates. Conduct a 15-minute phone interview using behavioral based questions.
  6. Conduct background reviews and schedule confirmation calls to prior employers.
  7. For those who appear “best fit” (a small number of no more than 3 per week), arrange for a face-to-face meeting. Utilize more behavior-based interview questions.
  8. Narrow the “offer” focus to the top 3-4 candidates. Make the first offer to the best candidate. If accepted, hire.
  9. Don’t forget to have a strong onboarding and training program in place. Provide adequate time for the new hire to review and sign the company handbook before training begins. 

One step in this process often overlooked is #3, the use of a competency assessment early in the process. Pre-hire assessments are available for ANY and ALL positions in your search and can be a valuable tool to bring to your hiring process. I have led searches nationwide. Each position has its own set of requirements. Each person has competency characteristics that will either predict success, difficulty or failure. Hiring managers need to know how to uncover those characteristics before an offer is made.

There are some great assessments you can use to uncover behavioral tendencies, demeanor and the likelihood of sucess. Using these tools in addition to background research, previous work histories, education and achievements will provide a more holistic and comprehensive view. The more comprehensive the hiring manager is, the greater the likelihood you can lower the high cost of bad hires. Take your time and resist the need to hire immediately.

What about your company? 

Has hiring been a challenge for your business?

Do you use pre-hire assessments?

What did your company do to reduce the cost of bad hires?