How to Save Yourself from Bad Hiring Decisions

bad hiring decisions

All employers want to fill their open positions with the best candidates. It improves productivity, drives the bottom line, and reduces costs associated with absenteeism and turnover. So how can you ensure that you are hiring the best candidates?

The simple answer is: don’t use a hiring process; use a selection process.

Most people don’t know the difference between hiring for an employee and selecting for an employee. And this lack of distinction unknowingly leads to problems, like high turnover, low productivity, and impacts your bottom line.

Hiring an employee is a process in which applicants’ resumes are reviewed, then a couple of interviews are given to seemingly qualified candidates, after which a job offer is made. On the surface this process seems sound. However, there are significant problems with this method.

Why Hiring Processes Fail

The largest issue with a hiring process is that it’s often too subjective. It relies on generic questions that fail to get to the heart of a person’s actual ability to do the job. Interview answers are rated subjectively, and hiring managers make the decision based on their “gut.”

For example, asking about someone’s strengths and weaknesses does not tell you about their ability to do a job. People have been coached on how to answer these questions. Even if someone’s answer did provide relevant information, how would you objectively know it’s a good answer? If your response is, “I know a good answer when I hear it,” you just fell into the trap of being too subjective in your evaluation.

Research shows that subjective hiring is far less effective than objective selection processes. Subjective hiring’s ineffectiveness can lead to additional costs and time spent rehiring people for the same position. This leads to lower productivity, unnecessary severance, increased hiring costs, and higher costs associated with absenteeism and turnover.

bad hiring decisionsAnother reason subjective hiring is ineffective is because many managers think they need to hire someone who has succeeded in a similar job. While this MIGHT be accurate in some cases, it’s not a foolproof method. Just because a person has held a similar position does not mean he or she will be good for your job opening. The person’s strengths may lie in areas that have little to no relevance to the role you need to fill.

The hiring process also unnecessarily eliminates individuals who skills sets and talents would benefit the position, but don’t have the “experience” that the resume reviewers or computers look for in candidates. For example, an individual who works as an administrative assistant at a university might not seem the perfect match to be HR manager at a corporation, but what if s/he deals with all the of HR functions for a department of 100 individuals and leads a team of three staff members? You may lose a well-qualified candidate simply because their previous job title didn’t match the keywords you’re looking for.

Creating a Great Selection Process

A great selection process needs to be designed specifically for the position that you want to fill, using objective measures. How you structure your selection process is going to be determined by several factors, including: cost, number of positions to fill, number of applicants, number staff available to conduct the process, etc. However, there are a few universal principles for creating a strong selection process.

Determine K,S,A’s

The first step in the selection process is to perform a job analysis to determine the relevant K,S,A’s (knowledge, skills, and abilities) needed for the role. These give you objective measures for determining how well a candidate matches up to the position. There are other—less involved—ways of determining K,S,A’s, but they are also less accurate.

Once you have determined the relevant K,S,A’s, you can use them to develop a selection process. Your selection process needs to answer three simple questions:

  • Does this person have the knowledge to do the job?
  • Does this person have the skills to do the job?
  • Does this person have the ability to do the job?

Create Job Specific Objective Measures

Select and rank the top 10 K,S,A’s, and design each step of your selection process so that each is measured at least twice (the particularly important K,S,A’s should be measured more). Make sure you have rubrics that evaluate each answer OBJECTIVELY based on the relevant K,S,A’s. I also recommend at least one measure in your selection process be a practical assessment (i.e. have the candidate actually perform some of the job functions).

Finally, don’t have just one person make the decision of whom to hire. Have at least two people evaluate all the results from the rubrics before extending a job offer. This will help reduce bias and better determine which candidate best displayed the relevant K,S,A’s. Whatever you do, don’t hire someone lower on scores because you “liked” them for the job. You’ll just waste time and money on a lower-qualified candidate.

Cost Implications

One of the largest criticisms of selection processes is that it costs more time and money than simply hiring people. Although this may true initially, it’s not true in the long run.

Exactly how much does high turnover cost your organization? Take a look at these statistics from eremedia:

  • For entry-level employees, it costs between 30-50 percent of their annual salary to replace them.
  • For mid-level employees, it costs upwards of 150 percent of their annual salary to replace them.
  • For high-level or highly specialized employees, you’re looking at 400 percent of their annual salary.

When you select the right people for the job, you have lower rates of turnover (which means less time and money spent finding a strong candidate), more motivated and capable workers (who increase the quality and quantity of work flow), reduce absenteeism, and reduce other negative employee behavior. All of these factors affect productivity gains and organizational costs.

If you want to have a successful workforce, you need to start by selecting employees who will bring the best relevant K,S,A’s to the table. Simply using a generic hiring process will not help you. Like everything else worthwhile in life, you have to invest in the process to reap the rewards.

What universal selection principle would you add to this list? What will you do, today, to ensure you are creating an objective selection process?