Recruiting right is tough. Very few business owners or managers can honestly say, hand on heart, that they haven’t ever made a mistake when hiring a new employee. Paula Maidens of Recruitment Coach explains how to make the right hire every time.
The business impact of a bad hire is hard to ignore, with a Drake International study finding that a hiring mistake can cost a business anywhere from 30% to 200% of that employee’s salary. Even for a junior employee on $35,000 a year, employers have a lot to lose. Based on those figures, the cost of hiring the wrong person could be from $10,500 all the way up to $70,000. A scary thought for any business and its bottom line!
While the reasons for hiring mistakes vary, using a simple recruitment process with a little structure will dramatically boost your chances of hiring the right staff, the first time.
To recruit right for your business, here are my top 5 tips:
1. Don’t rely on your gut instinct alone
While your gut instinct plays an important role in any business decision, the best hiring decisions are made with a combination of objective information and intuition. Put some science behind the art of interviewing to ensure that each employee that you hire can walk their talk. It’s all too easy to be blinded by a candidate’s interviewing skills if you aren’t focused on evaluating the candidate’s skills and experience.
However, don’t ignore your gut instinct: put it on hold until at least the end of the interview. Collect the facts about the candidate first and then review those with your impression to make an informed decision.
2. Get the candidate to show you their skills
Have you ever wondered if a candidate is telling you the truth about their skills and knowledge? Find out if they’ve got what it takes to succeed by putting their skills to the test with a verbal or written simulation. This is a lot simpler than it sounds: just consider a problem that an employee would face on the job and ask the applicant to come up with a solution.
This can be done as simply as asking the candidate to talk you through the steps to solve a problem verbally, or by asking the candidate to complete an exercise. For example, a graduate accountant could complete a sample bank reconciliation while a salesperson can perform a sales call to demonstrate their skills.
3. Don’t hire the best of a bad bunch
Don’t let recruitment pain get the best of you, as a ‘bums on seats’ approach can backfire spectacularly and make a negative impact on your business.
Rethink your strategy if you aren’t getting the right candidates. If you need to readvertise for the position, so be it. Hiring the best of a bad bunch will only cost you more time (and money!) in the long run.
4. Take a proactive approach
A ‘bums on seats’ approach is usually a last-minute resort to fill a position now. Avoid hiring a dud by planning ahead for your recruitment. Simply identify the positions you will need to recruit for, in order to achieve your business goals over the next 3, 6, or 12 months. By planning ahead, you can keep your recruitment radar on all year to find the talent your business needs, when it needs it.
Keep an eye out for resignation warning signs (such as more frequent absences from work, longer lunch breaks or a sudden change in attitude) to minimise the productivity loss on your business when a key staff member leaves. Looking out for warning signs gives you the opportunity to remedy the situation, if possible, or to start thinking about finding their replacement.
5. Protect your business from hiring mistakes
Unfortunately, even the best recruiter can make mistakes. Protect your business from hiring mistakes by using a probation period for all new employees.
A probation period is best used with a performance goal setting and review process to ensure the expected levels of performance is crystal clear on both sides. That way, if the new employee does fail to meet the goals to pass probation, performance discussions will be based on fact, rather than emotion.
Recruiting new staff can be an expensive and time-consuming process, so it’s important to get it right the first time. The business impact of a bad hire makes it difficult to ignore the importance of a recruitment strategy. A few simple procedures and a little advance planning will see your business dramatically reduce the risk of a hiring mistake.
Paula Maidens is Managing Director of Recruitment Coach, a coaching and consulting firm for small businesses, specialising in recruitment and retention techniques.
Opinion: Why do so many claim to represent small businesses?
By Adam Zuchetti
Opinion: House prices not all doom and gloom
By Adam Zuchetti
Analysis: How can SMEs realistically stay competitive?
By Adam Zuchetti