3 Ways To Reduce Bad Hires

Businesswoman drawing a decreasing graphAccording to a recent Careeerbuilder survey of 2,494 U.S. managers and Human Resource professionals between August 13 and September 6, nearly 70 percent of employers have reported that they have been affected by a bad hire this year. And what constituted a bad hire? In this case, it meant that the hire did not live up to expectations in terms of performance and there were six areas of concern:

  1. Employee didn’t produce the proper quality of work – 67 percent
  2. Employee didn’t work well with other employees – 60 percent
  3. Employee had a negative attitude – 59 percent
  4. Employee had immediate attendance problems – 54 percent
  5. Customers complained about the employee – 44 percent
  6. Employee didn’t meet deadlines – 44 percent

The study also found that 41 percent of the companies estimated that the bad hire had cost their business more than $25,000, with 24 percent estimating that their bad hire cost them over $50,000! These findings do have implications for the perception of the hiring process and deserve some attention. The first question to ask is, “Why are companies making such bad hires? ” Careerbuilder asked this question too and the main reason given for the bad hire, offered by 43 percent of respondents, was due to the pressure to fill a job opening quickly.

So, the prevailing situation here is that recruiters and hiring managers are facing pressures to hire quickly, which are proving counter productive and lowering the overall quality of the recruiting process. This is a situation that should not be allowed to continue as it could begin to negatively affect  the perception of the hiring process within the companies in question, and as an industry/profession as a whole.

I think it would be useful to set out several changes to a hiring process that can raise quality and minimize bad hires, while at the same time being mindful, but not held hostage to the need for speed.

1. Prioritize quality over speed

There is evidence that the hiring profession is becoming more quality rather then speed focused in order to minimize bad hires and raise the performance levels of recruits. Yes, the FutureStep Global talent Impact Survey revealed that the preferred hiring metrics were now ‘success of hire’ (cited by 67% of those surveyed) and retention (cited by 35%) with the time to hire metric being of much lower importance only being cited by 18% of respondents as the most important.

So, clearly recruitment and operations management should be prioritizing quality focused hiring metrics and ensuring that team members are incentivized accordingly.

2. Focus on employee referral

Research from Jobvite shows that employees hired by referrals stay significantly longer than employee’s hired through other channels, such as careers websites and jobs boards and the same research also shows that they are hired quicker. So, focusing on employee referrals, as a means of recruitment,  is a great way to increase retention and quality levels, with the added bonus of it being one of the fastest ways to hire.

3. Focus on the softer competencies during selection

A study by Leadership IQ found that the top five reasons that employees fail are due to lack of: coachability (26%), emotional intelligence (23%) , motivation (17%), temperament (15%) and technical incompetence (11%). Arguably, to increase quality of hire, recruiters should devote more time to assessing the candidate’s coachability, EQ, etc. as deficiencies in these areas seem to be a much more common cause of bad hires than technical incompetence.

I’d be interested in hearing about any other strategies you may have for minimizing bad hires, while being mindful of, but not unnecessarily controlled by, the need for speed in any one hiring situation.

in Recruitment Process]
Kazim Ladimeji
Kazim Ladimeji is a Chartered Member of the Chartered Institute of Personnel and Development, and has been a practicing HR professional for 14 years. Kazim is the Director of The Career Cafe: a resource for start-ups, small business and job seekers.