How costly can a bad hire be? According to a Society for Human Resources Management (SHRM) survey, one hiring mistake could cost up to five times the bad hire’s annual salary. In addition, research from The Harvard Business Review concluded that 80% of employee turnover is due to bad hiring decisions.
In addition, in a survey conducted by Robert Half 36 percent of the 1,400 executives surveyed felt the top factor leading to a failed hire, is a poor skills match. The second most common reason (30%) was unclear performance objectives. This can add to performance issues, misunderstanding between employees and supervisors, low morale – and so on. It can be a trickle down effect.
“Companies can’t afford hiring mistakes, which are costly and can erode staff morale,” said Max Messmer, chairman and CEO of Robert Half International and author of the Human Resources Kit For Dummies. “Finding the right match requires time and attention, and it’s something even busy managers need to make time for.”
Ron McGowan is the Principal of How to Find Work, an international career consulting company, and author of the international bestselling book How to Find WORK – In the 21st Century. But before that McGowan was a small business owner and recruiter. He wrote and placed help wanted ads, read hundreds of resumes and cover letters, interviewed and hired for numerous positions in his career.
Below, McGowan offers some tips and solutions on how to spot a bad hire and what to do once that bad hire been identified:
Warning signs of a bad hire
- Lower morale in their department.
- An increase in missed deadlines on projects in their department.
- An increase in errors and customer complaints related to their department.
- A surly, negative attitude from the new hire.
- A tendency to blame others for problems on projects they work on.
Signs you’re new hire is not what you thought they were
- Regular complaints about the job, company, and co-workers.
- Inability to deal effectively with everyday challenges.
- Poor relations with workers they interact with outside their department.
- Poor quality of work they’re producing.
- A marked change in their appearance and demeanor from that shown in the interviews.
Solutions to deal with a bad hire
- Deal with the situation immediately, don’t let it fester.
- Get specific, detailed input from co-workers and supervisors.
- Determine: Is it best to let them go, or can their deficiencies be remedied?
- Be clear about your/their legal rights if you fire them.
- Determine if their deficiencies contradict what they said or claimed in the interviews, or what they showed on their resume.
Bad hires: How to learn from mistakes
- Document what went wrong and make sure that the hiring process in the future includes reviewing these points:
- Be clear about your company’s values and culture. It’s hard to evaluate a prospect if you’re not clear about what makes your company tick, makes it successful, and the type of people who thrive there.
- Involve some of the people the applicant will be working with in the hiring process. Get the applicant’s resume to them ahead of time, so that they can formulate some questions.
- For technical positions, get your experts involved in the hiring process and ask specific, technical questions to determine their level of expertise.
- Ask the applicant what they know about your company and why they want to work there. Listen carefully to what they say.
- How diligent were you in checking out their references? Did you do any reference checking beyond the references they gave you? Did you check them out on social media sites like Google, LinkedIn, Facebook, and Twitter?
“It’s critical that defining the company’s values and culture is a company-wide exercise; with input and buy-in from all parties, otherwise, it is meaningless,” says McGowan. “A lot of this is just plain, common sense but sometimes that gets lost in the hiring process, especially in today’s fast-paced workplace,” says McGowan.
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