Perhaps it should go without saying that making good hiring decisions is critically important to a business’s success. But yet, even though it seems like an obvious statement, many organizations still shortchange the process, especially in times when job applicants are plentiful. Doing that can be a big mistake and can have far-reaching effects. Let’s take a look at some of the reasons that your hiring decisions need to be good ones.
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Here are some of the reasons that good hiring decisions are critical to an organization’s success:
- There are legal risks involved in making hasty hiring decisions. Bringing someone on board who could put the organization at risk is something we all want to avoid. However, avoiding this is difficult if the organization isn’t committed to completing due diligence for all potential new hires.
- The costs of hiring add up quickly. There are obvious costs, like advertising, time spent interviewing, and the costs of training a new hire. There are also productivity losses while waiting for an individual to get to full productivity on the job. When a poor hiring decision is made, these costs are all compounded because they must be completed again to replace the poor hire. This significantly increases the cost of turnover for the organization and increases the workload for HR teams—all because of something that was avoidable.
- Good hires become productive faster. A good hire, on the other hand, will get the company back to full productivity faster.
- Employee morale is damaged when bad employees are hired. Morale can suffer when a bad hire remains at an organization for an extended period of time.
- A bad hire can mean the organization loses business. This can be because of incompetency, inattention to client needs, or other related problems that result in lost business. This can have long-term effects on the organization and can affect the organization’s reputation.
- Bad hires increase stress. Stress can be introduced into the work culture when a bad employee is in the organization, lowering other employees’ productivity, too.
- If they don’t fit, you’ll have to bag them. Bringing in employees who are a bad fit or not right for the role increases the need for terminations down the road. This, in turn, ups the risk of unlawful termination claims or discrimination claims. It also increases the need for disciplinary measures, which cost time and productivity and can impact morale.
- Fixing a hiring mistake costs resources. Corrective actions to fix a hiring mistake can take a lot of time and effort. Besides the costs on paper of disciplining, terminating, and starting over with a new hire, there are also the costs in terms of employee time. All of this effort could have been directed to pursuits that had a better impact on profitability.
Tips on Getting It Right
Clearly, it’s tough to overestimate the importance of making good hiring decisions. Here are a few high-level tips for getting it right:
- Don’t shortchange the hiring process. All too often, organizations are hiring under pressure, which means there are time constraints on filling the role, and these constraints push us to make hasty decisions. Avoid this as much as possible. Be proactive.
- Know the skill set that is necessary, and know what skills can and cannot be taught. For example, it can be argued that it’s more important to have good people skills and good communication skills than it is to already know specific software programs or processes. The latter is much easier to teach than the soft skills, which are truly critical for performance. When interviewing, ask questions that can provide insights to the applicants’ behavior and personality, not just their technical ability.
- Don’t underestimate the importance of cultural fit within the organization. For example, if the organization values innovation and creativity and has an expectation that every employee will bring new ideas to the table on a regular basis, look for that skill in potential new hires, and avoid hiring someone who would prefer to be given instructions to fill all activities for the day without any innovation or new ideas.
- When you’re ready to make an offer, make sure it’s appropriate for the individual and in alignment with the market. It’s frustrating to go to all of the effort to find the ideal candidate, only to have that person walk away from the offer because it’s too low or doesn’t meet expectations. Do research in advance.
- When you hire someone, give him or her the training needed to succeed. Yes, it takes time and money, but it’s well spent to get the new hire trained and get him or her to full productivity faster.
- When a new hire doesn’t work out, take action. Find out if others share this opinion. See if there are ways to improve the situation, such as training or coaching. Provide frequent feedback. But if all that fails, consider either moving the person to a role that’s a better fit or consider termination before the problem worsens if none of the above will work.
This is just the tip of the iceberg when it comes to improving hiring decisions. What would you add to this list?
*This article does not constitute legal advice. Always consult legal counsel with specific questions.
About Bridget Miller:
Bridget Miller is a business consultant with a specialized MBA in International Economics and Management, which provides a unique perspective on business challenges. She’s been working in the corporate world for over 15 years, with experience across multiple diverse departments including HR, sales, marketing, IT, commercial development, and training.