“If you don’t have time to do it right in one attempt, how will you have time to do it again?”
Although your organization might be a growing one and you are in a great rush of filling positions; the process of hiring an employee shouldn’t be rushed in any way. Split second decisions might lead you to hiring a wrong employee for the job that can eventually end up costing you a significant amount of money. Moreover, your good employees may have to work harder in order to compensate for that single bad hire; this can lead to the risk of losing a good employee too.
The actual cost of hiring a wrong employee varies widely, ranging from one third of the employee’s salary to more than a million dollars, depending upon the position. There are some costs that cannot be measured, like the cost of negative interaction with clients or a sudden drop in team’s morale and thereby productivity. Bearing such a heavy loss just because of a wrong hiring cannot be afforded.
The major reason for ending up hiring a wrong candidate is the urgency to fill open positions. In this course, the employers fail to perform adequate research on the new recruit, his / her skills and the past experience. Sometimes, the cause could be failure in doing proper reference checks. Basically, sometimes recruiters miss out important stages of the process and therefore end up paying heavily for that mistake.
Bad hire incur some direct and indirect costs.
Direct costs include exit interviews, overtime pay for employees who perform the duties of the employee who is leaving, hiring a temporary employee from a staffing agency, cost included in advertising and searching for the new employee and investing time and money in on-the-job training.
Indirect costs include reduced productivity as the departing employee spends most of his/her last days performing poorly or completing exit interviews, work quality reduces as the new employee takes time in learning the job responsibilities and you might lose significant clients as a result of customer service gaps.
What Can Help To Avoid The Costs?
Performing effective interviews can significantly avoid the chances of a bad hire. It is also important to know that an effective resume doesn’t mean that the candidate is efficient. Professional resume writers can make anyone look good; so it is better to conduct the interview process cautiously and most importantly, verifying the past employer references.
- Conduct 10-15 minute phone interviews while screening the candidates
- Prepare a checklist of specific questions crucial to the position
- Pay attention to the answers and the candidate’s body language while answering
- Rephrase the questions if the answers you receive are insufficient or vague
- Don’t forget to take notes during the interview process
For the assurance of performing the hiring process effectively, a Recruitment Management System can come handy. It caters HR with a complete end-to-end hiring cycle, right from requesting open positions to finalizing the appointed candidate. With a system like this, maintaining candidate’s data and other crucial information like the candidate’s status, etc. will definitely be extremely simple. Every minute detail will be in front of you that will be helpful in making right decisions for your business as well as workplace culture.