A decision to hire a new employee always inevitably carries an element of risk. Most large organisations will have had experience of hiring an unsuitable employee – someone who looked and sounded the part at interview, but fell seriously short of expectations when it came to job performance. The effect of such hiring mistakes can be huge, with significant direct and indirect consequences for the company that makes the wrong decision.
Costs of Hiring the Wrong Person
New employees can fail at an organisation for any number of reasons. Often it will be failures to work well with colleagues or establish good relationships with customers that are the biggest issues, and this tends to be linked to things like a poor attitude or inability to produce the expected standard of work on deadline.
One of the biggest direct implications of hiring such an unsuitable candidate is the immediate financial one – the costs of the initial hire, added to the costs of severance and hiring a replacement a few months down the line. These costs can easily run into considerable sums of money, and will rise the longer the employee is left to do a bad job in the role.
Also to be factored in is the cost of lost business and opportunities over this period. The 3-6 months wasted with a poor fit employee could easily have been time spent with a superstar in the role, making sales, building relationships and bringing new ideas to the table.
On top of the financial costs, there are also the potential for serious internal disruption and unrest amongst other employees in the company. These employees may be forced to pick up extra work and responsibilities because of the inadequacies of their new colleague, meaning that morale will fall and the company may have to expend further resources rewarding previously contented staff and keeping them from jumping ship.
Finally there is reputational damage. This is something that should not be underestimated, because any employee, even if they only occupy a role for a few months, is a representative of their company, and as such any negative characteristics of theirs will reflect back onto their employers. This of course is particularly pertinent if the employee is in a customer-facing role, because they will be in a position to make or break relationships with existing and potential customers.
Reasons for Bad Hiring Decisions
Sometimes it can be tempting for companies to put a poor hire down to bad luck, to shrug it off as something that ‘just didn’t work out’. In reality, there will almost always be shortcomings in the hiring process that cause such mistakes to happen.
Sometimes it will be the case that candidates are not interviewed or vetted properly, leading to assumptions being made over their suitability for a role. For example, assuming that a candidate will fit a role because they have held similar positions in the past is dangerous, because it does not take into account the differences in culture, environment and working practices from one business to another.
Given the enormous costs involved in dealing with a hiring mistake, it makes sense to invest in making your hiring process as watertight as possible to minimise the chances of mistakes and incorrect assumptions being made in the first place. This is where a retained search firm comes in. They can use their experience and expertise to look beyond the list of skills on a CV and actually assess the person behind it, ensuring nothing is left to chance and the right individual is hired for the job first time around.
With retained searches, Oakstone delivers additional qualification tools such as balanced scorecards and detailed candidate profiles, plus thorough qualification from in-depth 1st stage interviews.
These factors lead to significantly improved results, quality the minimisation of touch points by the client avoiding much of the hassle and general stress that can be caused in the process of finding the best people.
The added value and time savings derived from the input from an experienced, professional firm will pay for the investment time and again.