If you've made a bad hire in the past, you're not alone. According to a recent study commissioned by Glassdoor and the Brandon Hall Group, 95% of companies admit to hiring the wrong people each year
. When a company brings the wrong people on board, the organisation will likely suffer losses from lower productivity, reduced retention rates, and negative cultural impact.
Here are three steps that you can take to avoid those hiring disasters and ensure that you bring the right people into your business each time.1. Use competency-based interviewing techniques
Gone are the days when you can step into an interview with a canned list of a dozen interview questions and expect to find the ideal candidate. Nearly every candidate has crafted the perfect answer to questions like "Tell me about your background" and "What is your greatest weakness?"
While answers to these questions may provide you with a bit of information about the prospective employee, they are close-ended and will give you little insight into a candidate’s workplace behavior. Competency-based interviewing digs deeper into how the candidate things, and allows the interviewer to go beyond what's on the resume.
Here's how competency-based interviewing can help you avoid bad hires:
- Competency-based interviewing, also known as behavioral interviewing, asks the candidate to provide examples of past work behaviors to demonstrate their various skills and aptitudes.
- Depending on the position, questions can be tailored to measure motivational competencies, analytical competencies, and managerial competencies.
- Because competency-based interviewing focuses on various core competencies, it’s ideal for identifying transferrable skills for both new hires and existing employees. You may have existing employees who are perfect candidates for the position, even though they are working in other areas of the company.
Most bad hires in organisations are more a byproduct of behavioral tendencies and culture clash than lagging skills. Skills are simple enough to determine, but behavior isn't as easy to identify and measure. Open-ended questions allow potential candidates to demonstrate that they are the right fit for both the position and for your organisation as a whole.2. Be aware of unconscious bias
Do you believe that you are a completely impartial and unbiased interviewer? Most people do, but there's a thing we can't control called unconscious bias that sneaks in and colors our judgments of potential job candidates.
New York University psychologist and researcher Dr. Jonathan Bargh studies emotional evaluations and perceptions from several angles. His conclusion is that unconscious bias in hiring exists
because everything we encounter "stimulates an instantaneous, preconscious response that has nothing to do with thought or reason."
So, if we are introducing this bias into the interview process without realising it, what is the solution?
Here are a few things that you can do:
3. Proactively build your network
- Bargh recommends working to overcome unconscious bias simply by acknowledging that it exists and giving each candidate additional attention.
- Another way to overcome bias is to be as inclusive as possible in your interview process. Involve a cross section of people who will work with the candidate and make a point to really listen to their feedback when making hiring decisions.
Getting hit with having to fill an open critical position can be stressful for a company. In fact, a recent study found that 42% of small business owners named hiring new talent as their biggest challenge
What if you already had a pool of qualified candidates waiting in the wings that you could turn to when these opportunities appeared? Trying building a network of talent using all available resources from within your organisation. Referral recruiting is an excellent way to find top talent
by leveraging existing relationships with people in your organisation. Internal referrals are effective for several reasons. No one wants to refer bad talent to their company because it obviously reflects poorly on them.
Referrals coming from within an organisation also often have a better "inside view" of the company than someone candidates with no connection whatsoever. That familiarity often helps facilitate a better ‘cultural’ fit.
To use internal referrals effectively, assign someone to proactively mine staff networks and execute outreach campaigns to potential candidates.The cost of bad hires
For startups and smaller organisations in particular, getting things right the first time is critical in the hiring process.
The Department of Labor estimates that a bad hiring decision could cost a company as much as 30% of that employee's potential earnings. For a management or technical position, your company could be looking at a $50,000 or greater loss for a hiring misstep.
In addition to the cost factors, managers invest time in the hiring process that they would prefer not to have to repeat multiple times to fill the same position. Rather than losing time and money on a hiring disaster, use advanced interviewing techniques, manage your unconscious bias, and proactively build your network so that you'll have a steady stream of qualified candidates to contact when those openings become available.