Are Hiring Mistakes Costing You Real Money?

By Susan L. Lauer

Are Hiring Mistakes Costing You Real Money?

According to the bureau of labor statistics, over the 12 months ending in May 2013, hires totaled $51.9 million and separations totaled $50.1 million. While it is reported that as we come out of the recession, employers have the upper hand in hiring many employers continue to make less than optimal decisions in hiring. A survey done for CareerBuilder.com found that 68 percent of employers said they were affected by a bad hire in the past year.

The survey which was conducted among 2,696 employers by Harris Interactive, found that a single bad hire can significantly affect an organization's bottom line. Forty-one percent of companies that made a bad hire estimate that it cost them more than $25,000 and one in four said it cost more than $50,000. The price of a bad hire adds up in a variety of direct and indirect ways.

When classifying what makes someone a bad hire, in the Harris Interactive survey employers reported several behavioral and productivity-related issues:

Employee didn't produce the proper quality of work - 63 percent
Employee didn't work well with other employees - 63 percent
Employee had a negative attitude - 62 percent
Employee had immediate attendance problems - 56 percent
Customers complained about the employee - 49 percent
Employee didn't meet deadlines - 48 percent

The most common effects of a bad hire are:

Less productivity for the specific worker and their colleagues - 41 percent
Lost time to recruit and train another worker - 40 percent
Cost to recruit and train another worker - 37 percent
Employee morale negatively affected throughout the department or division - 36 percent
Negative impact on client solutions - 22 percent
Fewer sales company wide - 11 percent
Legal issues - 9 percent

These dollars come directly off the bottom line. We know few companies or organizations that can or want to essentially throw these sums of money away. In our experience, the top reasons that new hires do not work out are:

The employers were in a rush and took the "first warm body"
The employers did not have good interviewing skills
The employers limited interviewing to just one person rather than a few people
The employers lack of understanding as to what true talents are needed for the job
The employers were unwilling to apply standard profiles or assessments as part of their interview and decision-making process

The contributing factors to the bad decisions, according to the survey, are:

Needed to fill the job quickly - 38 percent
Not sure; sometimes you make a mistake - 34 percent
Insufficient talent intelligence - 21 percent
Didn't check references - 11 percent

Many of the items listed above are easy to take action on right away to avoid your next hire being a bad one.

Fully understand what talents and behaviors will work best for the job. If you have others who are successful in that position, find out why, and what talents and behaviors they exhibit.
Take your time. Resist putting a warm body in place. You will only be starting over again soon.
Train those involved in the hiring process in good interview techniques. Let them practice.
Have your potential hires take a talent assessment, match it to the prospective employee and validate it during the interview process.
Involve more than one person in the hiring process.

As part of best practices, organizations and companies have adopted talent assessments for all hires to maximize the chances that they will be the right fit for the individual and the company. We suggest that if you are involved in hiring and have not yet taken an assessment yourself, that you do so now and take advantage of the insights offered to improve your contributions.

About the Author

Susan Lauer, Principal at Aspire Consulting a company that assists in building or implementing plans that support necessary change, transform leadership, improve processes and sustain success for businesses and organizations. Please contact her at SLauer@AspireAdvantage.com or (845) 803-0438 to learn more. Article Source: http://EzineArticles.com/8039523

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