Most would agree that the need to fill a position quickly is the number one reason for a bad hire. Yet if weighing up the pros and cons of taking on a bad recruit, compared to leaving the position open, what would be your choice?
The business’ needs may dictate an immediate hire, and if you can get it right, kudos to you. A great recruit will increase your ability to succeed in almost everything you do. Now, let’s look at the flip side of that. A poor recruitment decision will have a ripple effect that will obstruct your ability to move forward at every turn, compromising your future greatly. But what really are you sacrificing by hiring the wrong candidate? Let’s firstly consider productivity.
A regrettable recruit at the entry level will see a great deal of a team leader’s time spent training the recruit and a lot less time managing the advancement of the team and ultimately the company. It is also likely that the new candidate will have a short term tenancy with you and force you to repeat the process of finding a worthy candidate. Rushing the decision has only led to losing a lot of ground. At the higher level it’s another ball game and emphasis on lost productivity is enhanced greatly. You probably don’t have to imagine the devastating effects of an unqualified and inexperienced senior manager directing their subordinates to concentrate on tasks that are neither fruitful nor focused on achieving the objectives of the organisation. Not only is the senior manager not spending their time wisely, but they are directing an entire team to be equally unproductive!
The dollar value of lost productivity is difficult to quantify. A survey by CareerBuilder has found that a bad hire may cost you $25,000 in just one year. In a small business though, where employees often take on multiple roles, that cost may balloon to as much as $190,000 per annum, according to the survey. I’m almost speechless. Evidently these figures include a lot more than the time spent advertising a role, sifting through resumes and interviewing candidates. And since you rushed the recruitment decision, that actually doesn’t amount to much time at all. So where else does your unwelcome hire have you leaking funds from?
How valuable are your client relations to your bottom line? I recently switched a service provider because my supplier continuously failed to deliver on my needs. Despite numerous conversations where I repeatedly conveyed, with clarity, what my business needs were now and moving forward, they continuously ignored deadlines, continuously made excuses and never once delivered on even the most simplest of requests. The months they spent ducking and weaving gave me time to find a supplier that not only met all my needs (service, functionality, current and future technological demands, and price), they did this so very quickly. On the grape vine I hear my former supplier is losing clients hand over fist. Their poorly recruited employee is causing their bottom line to see red, while their competitor is enjoying an unexpected rise in sales.
Generally employees, and customers, know pretty quickly if a new worker is a dudd or a superstar. The later will raise spirits and regenerate motivation. A dudd on the other hand will sap the life from both you and your profit margins. In a small company negativity can spread quickly. Coming to work each day will soon become a chore. Furthermore if the boss does not act to curb the downward trajectory of office spirits, employees will become less engaged with their work and look for more positive opportunities elsewhere. They may even take your best clients with them! The question needs to be asked, can you afford to lose your best workers at the expense of a second rate addition? And can you afford to now be hiring, and training, for multiple positions while sourcing new business clients to replace those you lost?
The revenue that a bad recruit is not generating will cost your business dearly. And it will not stop until you take action to stem the bleed. So in a very short space of time, the business that you have tirelessly built over several years can soon become a liquidators dream. My advice when looking for a quick hire, don’t rush it. If you don’t have the time to fully analyse your future investment, hire a consultant who does. Your staff are your future, so unless you’re seeking a destiny of failed ambitions, I suggest you make time to make the right investment decision.
SJ Personnel…connecting you with your future.