Last week, I was talking to a business owner who said that hiring the right people continues to be one of his greatest challenges. In my experience, most businesses wait too long to fill a vacancy, then hire too quickly. After realizing a mistake had been made, they take too long to terminate.
The latest research says that the cost to terminate and replace an employee is their annual salary plus 1.5 times their annual salary (not counting lost productivity).
I have empathy, because that is one of the mistakes I have often made. We all want to be compassionate and give staff every benefit of the doubt, hoping things will turn around, but it seldom does. I learned this as a young entrepreneur and later as a corporate manager.
I believe hiring is even harder now for a couple of reasons:
- You cannot rely on resumes! Think about it. Do you believe a potential employee is going to say in their resume if they failed, did not get along with others, or were fired from a past position? As well, most resumes are now written by professional writers or adopted from one downloaded from the internet.
- Reference checks don’t work anymore because of the potential legal liability of giving a negative review of a past employee. Most previous employers will only provide name, dates, and position title.
So what can you do to mitigate the risk of a bad hire? Unfortunately, you can never be 100% sure. However, here are three strategies that many successful organizations use, especially when hiring for senior positions:
- Conduct a scientifically validated skills assessment. There are a number of instruments that can help with this. One is the PXT, an assessment used for selection, on-boarding, development, managing, and succession planning. It measures how well an individual fits a specific role in your organization based on historical job modeling.
Another one is from Talexes. Their MXP compares an applicant’s strengths and weaknesses to an achievement pattern predetermined by your organization. It identifies the characteristics most required in that position and compares the applicant’s results to that success profile.
- Use a psychological assessment that will determine the best fit into the culture of your organization. One I use is the LSI (Life Styles Inventory) from Human Synergistics. It measures the thinking style of the individual and how this thinking translates into everyday behaviors. It provides detailed information about the applicant’s strengths and development needs, including the quality of their work relationships.
- Use behavioral interviewing techniques. While a resume will tell you what an individual did yesterday ─ behavioral interviewing demonstrates how a potential hire has performed in the past and their decision-making tactics.
Examples of this type of questioning would be: “Tell us about a time you had to carry out a company policy that you did not agree with.” Or, “If you found yourself in a personality conflict with another employee, how would you resolve it?”
Organizations that have adopted these strategies are able to conduct more effective recruiting and significantly lower attrition rates. The added benefit of implementing these strategies is a faster, less expensive hiring process. Ray Kroc, Founder of McDonald’s, once said:
You are only as good as the people you hire.
My question for managers:
What is your process to ensure you have the right people, doing the right things, and behaving the right way to ensure a cultural fit with long-term success in your organization?
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