The Hidden Consequences of Making A Bad Hire

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May 31, 2016

The world’s innovators are calling for reinvention and transformation of HR departments. Given that the majority of hiring responsibilities fall within HR and it is, in most cases, the entry into companies, reinventing HR must start with transforming the way leaders think about and behave about hiring.

Many innovative leaders and early adopters are already operating highly effective, conscious hiring programs out of pure necessity. While some may advocate for the complete destruction of human resources departments, the proper solution is the complete destruction of old, outdated, unconscious and ineffective hiring techniques.

Frankly, while people and business have remained virtually unchanged, human beings’ perspectives, outlook, attitudes about work and their ability to manifest what they want — when they want — has spurred a fundamental shift in the way people operate in and around business and work today. With a plethora of newly created job options coupled with a major changing of the guard in the workforce, smart companies must equip themselves to navigate through these new employee / workplace paradigms.

CEOs, business leaders and managers are acutely aware of the fiscal costs of a mishire, but there are some invisible — and potentially insidious — costs that can wreak havoc on your organization. Although it might not be top of mind, when you hire a person who does not fit with your organizational culture or operating philosophy the impacts are pervasive throughout your organization. By continuing to operate with outmoded hiring practices, you become susceptible to four specific hidden consequences of a mishire.

1. Fragmented customer service

Ensuring your team understands your product and service set, and why customers use them, is where excellent service begins. You can — and ought to — bridge the knowledge gap for new hires with comprehensive product and service training. However, you cannot train your workers to care about the customer. Behavioral and performance research shows that great service is delivered through a fundamental set of values, attitudes and beliefs that are in alignment with a service philosophy. When people are in a role in customer service for the wrong reasons, no training in the world will compensate for their lack of connection to the work itself.

When we expect one level of care from the place we spend our money, but receive service that is counter to that expectation we feel disengaged, dissatisfied and even anger. When you hire a person whose heart is not aligned with your mission and your service offerings, or they lack the basic service acumen to execute your customer service objectives, this same level of dissatisfaction is what your customers experience.

2. Reduction in innovation

Companies arrive at a sustainable business model through innovation, creativity and a keen awareness of how to bridge a gap in the market place. Once the product set is stable and customers are buying, continual improvement and innovation is required to stay ahead of the copycat curve. When some of your people cannot seem to get it together, miss basic deadlines, or don’t find problems until your customers do, innovation is not even an option.

When an employee is hired because their resume lists the right key words, yet the person behind the resume lacks conceptual thinking ability and theoretical problem solving, they lack the ability within themselves to come up with creative and inventive solutions. Often this lack of ability shows up as excuses and finger-pointing — roadblocks outside their control. It is important to be aware that a person who lacks these traits is unaware they lack them, and that most often these traits and competencies are very difficult to teach. If time is not on your side, hire people for roles that need to innovate who have these innovator competencies, behaviors and values.

3. Workforce productivity

When you hire in a hurry, you experience unwanted turnover. If you are lucky the turnover happens fast, yet in most cases it is months before the problem surfaces and the impact of the wrong person doing the job wrong has already spread throughout the team, if not the department. In high level roles, specifically senior leadership, the impact is detrimental not only in the immediate area of influence; it permeates throughout the organization. In sales, for example, if you have 2 or 3 people continually not achieving quota and approaching the position with a poor attitude, it poisons the well for those who are producing and are aligned with the job requirements and level of activity required for success.

Tolerating people who are not engaged and thriving waters down the engagement and productivity of those who want to win. When any of these morale and engagement busters are happening within your culture good people either leave or move into autopilot until they can leave. The indirect impacts are higher staffing costs to make up for the lack of employee and team productivity, institutional knowledge loss when good, trained people leave, and increased training costs as you hire replacements.

4. Time and energy losses for the team and leadership

We have all heard the old adage that 80% of our time is spent with the bottom 20% of performers. As it happens, this statement may be closer to 30% of the under-performers. As the competition for talent increases and the fear of the empty chair blocks your good sense, you can feel pressured to fill the job with the first decent person who surfaces. Hiring the wrong people because you are “in a rush” to put a butt in a seat leads to more empty seats; or worse: full seats with empty pay offs.

One of the hidden costs of unwanted turnover as reported in recent employee and manager engagement surveys is that 70% of managers surveyed reported they are coping with burn out and a job misery rating that is detrimental to their overall happiness. When the workplace culture turns into one of micromanagement, correction and reprimand rather than collaboration, creation and mentoring, the manager’s job becomes one of parent and babysitter.

Often we see managers and leaders looking to HR to fix people and situations that could have been avoided by demonstrating more consciousness and awareness before, during, and after hiring. It seems that in many companies an admission of making a poor hire is a far worse offense than allowing and tolerating subpar performance. Furthermore, the cost of doing nothing about a bad hire far outweighs the cost of being proactive and creating high-impact hiring solutions. When you think about it in terms of bottom line profitability and overall success, shifting your philosophy about people and hiring just makes common sense.