Recruiting and Staffing

Looking to 2011: 4 Ways to Stay on Track and Avoid Bad Hires Next Year

Hiring

Post a job, sift through the resumes and interview candidates. Signed, sealed, delivered – you’ve hired someone and they’re ready to work.

It’s hiring in its most basic form, but not so fast – what happens when that candidate doesn’t show up? Or doesn’t fit in with the team? The list of “what if’s” could go on and on.

Unfortunately, poor hires are a common business hazard. So much so, that according to CareerBuilder research, more than two-in-three companies said that a bad hire adversely affected their business in the last year.

The cost of bad hires

The cost of these bad hires is stunningly high as well; nearly one-in-four hiring managers said that one, just one, bad hire cost their business more than $50,000 in the last year, while four-in-10 said a bad hire cost them more than $25,000. With the recession slowly easing and companies beginning to add to strained staffs, losing valuable resources from the fallout of poor hiring choices is something that many organizations simply cannot afford.

One of the resources lost when a bad hire is made is time, plain and simple. Bad hires cost time as the company has to recruit and train another worker.

They’re also a major factor in turnover, which leads to lost time; According to the Harvard Business Review, 80 percent of turnover is caused by bad hiring decisions. In addition, poor hires can have a negative effect on employee morale, which can lead to lost productivity and more.

The CareerBuilder survey of more than 2,400 employers also found that of employers who made a bad hire, 36 percent said they think they made a mistake hiring someone because they needed to fill the job quickly. It makes sense that often when you need help, you need it as soon as you can get it. Hiring the wrong talent for a position, though, can leave you even further behind the second hand.

How to keep hiring on track

With the seriousness for hiring the right candidates so clear, especially as companies finalize recruitment budgets for 2011, many are taking strides to avoid hiring someone who isn’t a good fit. How can you stay on track next year?

  • Perform a detailed job analysis. Before you begin the search for a great candidate to fill an open role, talk to the manager and co-workers of the position. A basic job description can only take you so far, but a detailed job breakdown and the attributes of the person who held the job before it was open are key insights into who will be a good fit for the job. Learn what you can about that person’s personality; were they outgoing? Analytical? Did this work well in the role? Knowing more than the basic requirements of the job before you post it help to reduce the chances of a poor fit.
  • Create scenarios for the interview. Think about different situations and challenges the candidate will likely face based on past experiences or new developments. Propose specific scenarios to candidates during the interview to see how they would handle themselves and what they would recommend. This also gives great insights into critical thinking skills.
  • Use talent intelligence to learn more about who wants to work for you. Surveying current and potential employees can help you understand more about the people who are the best fit for your organization. What motivates them? In what type of work environment do they thrive? And what do they want out of a job or company? Being able to understand what job seekers in your industry are looking for in a company helps you to target your posting to the right candidates.
  • Check out candidates’ backgrounds. Make sure your staff has a standardized hiring process in place that includes background checks and reference checks. Both tactics help to avoid candidates who may be unfit or have a criminal background that doesn’t coincide with your workplace environment. This is especially important to conduct if you’re looking to fill positions with access to confidential information, like financial statements. It’s always a good idea to loop a lawyer into setting up these practices if you haven’t already to make sure you’re following EEOC regulations.
Brent Rasmussen is president of CareerBuilder North America, and in his role, he heads the day-to-day operations of the North American division. An accomplished strategist and industry veteran, Rasmussen drives the innovation, expansion and ongoing revenue growth of CareerBuilder.com the U.S.’s largest online job site, and CareerBuilder Canada. Prior to joining CareerBuilder, Rasmussen served as manager of Business Services for Xerox Corporation.
  • http://blog.yoh.com Doug Lubin

    I’d be curious to hear how CareerBuilder defined bad hire during its research. The negative impact of a bad hire is real though. Good recommendations for getting employers on track to avoid them. I added a few more thoughts and tips here: http://blog.yoh.com/2010/12/whats-in-bad-hire.html.

  • Allison Nawoj

    Thanks for your question, Doug. In the survey research by CareerBuilder, we let the employer respondents determine what a bad hire was as we didn’t specifically ask how they would define it.

  • Mr. Smith

    I’ve noticed a lot of job responsibilities turn out to be vague and complex. It really helps when the position is focused on what exactly is needed out of the position and the candidate is matched appropriately. The worst thing you can do is state “other duties as needed” and then not set a reasonable limit. Focus the job description and minimize the “other” portion. Although an employee may have no problem fulfilling a request it may not be the best route.

    If there are many responsibilities and the work could be done much more efficiently, hire two employees and clearly define roles.