Unseen Cost of a Bad Hire

Bad Hire

Hiring process is a more organized and elaborate now than ever before; steps involved in hiring have considerably increased. After years of experience on working with bad hires, companies are now realizing the monetary and non-monetary cost of a ‘mis-hire’ or more bluntly put ‘Bad-hire’.

Companies have come up with innovative ways to judge the candidates before hiring through hackathons, internships and other internal vetting procedures which will help better understand candidate’s durability, competency and cultural fit in the company.

Despite precautions taken by the HR department before hiring candidates, some discrepancy in the hiring process costs dearly to the company. Some indirect benefits of having good employees are they will be your brand ambassadors, create a culture of comradeship for your business and attract good / similar talent from the industry.

Whereas a bad hire could drive away key customers, impair customer loyalty, erode employee morale and trust and drive away high performing employees.

If we look at it statistically, the immediate monetary loss due to a bad hire alone sums up to 30 percent of the employee’s annual income. The negativity that a bad hire leaves behind can be quite lethal for the team and could take considerable amount of time to rejuvenate.

Cost of Bad Hire

Hiring new employees is no easy task - there are many choices that must be made when choosing the right employees to fill positions

Steve Jobs on bad hiring, "I noticed that the dynamic range between what an average person could accomplish and what the best person could accomplish was 50 or 100 to 1. Given that, you're well advised to go after the cream of the cream...A small team of A+ players can run circles around a giant team of B and C players."

With years of experience in hiring, the HR executives can identify if an employee will stick with the company or not. They gauge the persona of the candidate over initial screening process.

It is in the intermediate process where the hiring goes wrong. Market needs sometimes puts hiring managers in a fix to speeden up the hiring process. This leads to clouding in the main agenda behind hiring, here are five factors that a hiring manager could consider before recruiting:

Do you really need to hire someone for this position

There are ample freelancers and independent contractors who are willing to work from home at a much cheaper cost. This will save on several costs including, payroll taxes and benefits, health insurance and paid vacations. Moreover, you could increase the productivity of existing employees.

Check internally for project completion

On several occasions you are over hiring - there usually is a project close to completion and employees are on bench. You could internally hire someone; you save on the interview process, new hire paperwork and the vetting process. This will also save on time-to-hire, a fresh candidate will have to go through an interview process, a notice period to serve - meanwhile the internal employee could be yours.

Ask for referrals

Referral hiring programs are quite common in most workplaces - but the involvement may be as low as 30% for average companies and up to 60% for the best of breed. Employees are likely to suggest their competent associates for the job who will stick around in the company. Most workplaces integrate a referral bonus; when the new candidate completes three months of work, the employee gets a bonus. To avail this bonus, employees make sure they refer good candidates.

Save time by modernizing your hiring methods

There are umpteen number of modernizing your hiring method - hiring over social media, video interviews, online assessments, selection based on computer algorithms and so on. Once you select the resumes you’re interested in, consider setting up an online video interview with the applicant to get a better sense of who they are. You could set up the assessment and review it at ease. In just a few minutes, you can get a decent read on a person. Be a judge of what sort of attitude you are looking for in the candidate.

Develop your own analytics to gauge top performers

Shadow your new hire - see how s/he works, how long does it take for them to finish a given task, and punctuality. Pay close attention to the first few months in work, the longer you take to find out that the new hire is indeed a wrong  hire will cost you that much more.

‘Mis-hires’ Eroding Your Global Business

In an effort to expand businesses, leverage the low-cost advantage; many foreign companies establish offices overseas. Finding top talent that is retentive and more importantly, that matches the cultural aspect of the organization is a very daunting task. Hence, recruiting process becomes very critical for the success of these initiatives.

See how Behavioral Firment Reports can Help Save Your Business!
Repercussions of Mis-hire: Uber India

Hiring in a new geography, especially when the senior management team is located elsewhere - curating the recruitment process becomes imperative. To deem the candidate competent, many companies even fly candidates down to home location. International companies like Uber have faced severe repercussions on a global scale for a mis-hire in India.

Screen Candidates over Recorded Interviews

A standard solution to such gaps is to centralize the recruiting process. With the existing process, you will have to adjust time zones to interview the candidates; it is harder than easy to find solutions on this front. Automate the initial screening process using video interviews; this has proven to be instrumental in solving a substantial portion of global hiring problem.

Global companies have been opting in for - asynchronous interviews that helps companies establish a ground for multiple panel review in initial stages in spite of being spread across different time zones.

Centralize the Process with Multi Panel Live Interviews

Live interviews help to auto-schedule interviews and let candidate and panel join from the device and location of their choice. Many video interview applications offer what simple video conferencing platforms don't, conducting online written assessments to candidates and collating them for review for a simpler and hassle-free screening. Video logs of written assessments and recorded video interviews allow companies seamlessly keep track of recruitment across geographies for HR audits - all centralized and documented.

Delve Deeper than Resumes with Behavioral Firment Reports

They also offer behavioral insights or commonly known as psychometric assesment reports that generates behavioral fitment reports based on candidate's responses. These reports are configured to map organization's existing culture and map it against the candidate's behavior. It also offers reports if the candidate is fit for the role he is planning to take up. This basically let's you avoid 90% chances of landing on a mis-hire or bad hire. 

Also see: Importance of screening for behavior while hiring

Change is good and when the change involves updating HR technologies - it must be embraced. The benefits of automating hiring with Video Interview platforms are manifold.

Video Interviews has proven to:
  • Reduce human error
  • Reduce time-to-hire
  • Reduce fraudulent interviews and repeat
  • Save money spent on scheduling and traveling
  • Offer quality candidates without much hassle
  • Aid smooth governance with process documentation
  • Offer insights into candidate selection patterns with hiring analytics

We all know that hiring is not a black and white task, it is imperative that right amount of time is spent on deciding whom to hire and if you actually need to hire. A ‘mis-hire’ will not only pile up cost factors for the company, it can be taxing on you as a hiring manager also. Hand-holding new hires can be tedious and time-consuming and the bitterness left behind by the wrong  hire can also leave you behind in your plans.

Recognizing Effective Ways to Hire Right Candidates

No industry can survive without hiring. And do believe when we say hiring is an exhaustive and time-consuming process. There has never been a dearth of candidates. However, recognizing a candidate who has the conviction, commitment and skill is quite a task. The real test of an HR recruiter lies in choosing the right candidate for the right job. Remember, great organizations begin with great hiring.

The company is at the losing end if it is not able to hire the right candidate. Poor hiring will weaken organizational skills and deteriorate the culture. However, practically many times due to the paucity of time, the recruiters are left with little choice.

But not anymore! Revolutionary changes are happening in the recruitment world. With new hiring tools like online video interviewing, things are fast changing. These are making a tremendous impact on the cost-effectiveness of the rest of the hiring process. More importantly, video interviewing helps in gauging the potential of the candidate irrespective of the distance. The recruiter can conduct the interviews online, and the candidate can take the interview in the comforts of his home. Thus, the company gets a suitable candidate even if the candidate is stationed far away.

Added to these, video interviewing facilitates the user in more than one way.

  1. It helps companies to screen more candidates for the same cost and time.

  2. It widens candidate reach significantly.

  3. It gives lot of convenience to candidates by improving response rate from the best candidates.

  4. The videos can be re-run to check the candidate’s performance in case of any doubt.

Also if the hiring of right candidate is correct in the initial process, things will be much smoother for the recruiter as well as the company in the later stages.

With the advent of such recruitment tools, hiring the right candidate is much easier, and the process is much transparent and efficient. The task of the recruiter is also much sorted out. Moreover, with the option of viewing the interview later on, right decisions can be taken without rushing in.

One wrong hire can bring a robust team down. Productivity is hampered and the company suffers regarding cost as well as project deliverables. Right decisions in recruitment processes matter. Right and committed candidates are an asset to the company. They bring with them right talent and the right attitude and help in charting success stories. With sufficient time in hand and distance not being an issue, taking good decisions is easier. Online recruitment tools are here to ease your decision-making and make it more efficacious.

How to Deal with Low Performers

If have already hired them, here's how you deal with low performers.

Every team has a few members whose performance is not up to the mark. Dealing with such performers is the most challenging task for many managers. A manager just cannot ignore the performer as it directly affects the performance of other team members. If a manager ignores the low performer then his work needs to be completed by the other team members which add a lot of burden on the shoulders of other team members. Due to this, the performance of the whole team goes down, which proves out to be a major loss for the company. Let’s have a look at some of the methods to deal with low performers:

Understand the real problem

In certain cases, the employee is not a low performer, but due to some problem his performance goes down. Some of the possible reasons behind the poor performance of the employees may be insufficient training, higher expectations or a hectic schedule. So, sit down with your team members and discuss in brief the problems being faced by them. This conversation will make things easier for you as you will be able to find the perfect solution to the problems of the employees which will further help in improving their performance.

Give roles according to the personality

Every employee is not equal as everyone has different strengths and weaknesses. A project involves complicated as well as easy tasks. The best way to deal with low performers is to assign them easy tasks and assign complicated tasks to employees with better skills. In short, a manager needs to assign roles according to the personality for achieving success.

Opportunities to improve performance

Within a few days, a manager is able to conclude who are the best and the worst performers in the team. It’s the responsibility of a manager to communicate with the low performers and guide them in the right direction to enhance their performance. A manager should give feedback to the worst performers and prepare special plans to improve their performance. With proper guidance, low performers will able to commit fewer mistakes and as a result, their performance will be enhanced.

Stick to your policy

No firm wants to keep low performers in their company. However, if you terminate low performers without giving any chance to them, then other employees will lose interest in your company which will directly affect the company’s result. So, stick to your HR policy and provide a certain period of time to enhance their performance and if they fail to do so after several opportunities then terminate them.

Do the paperwork

Low performers might challenge your decision of terminating them on the basis of low performance in court. To protect yourself from such instances, make sure you keep a record of every employee so that you can easily prove it in the court.

Follow these methods to deal with low performers without affecting the performance of other employees. These methods will help you to successfully complete your task without any difficulty as the performance of low performers will be efficiently utilized.

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