The most important decision a business can make
Think about it for a minute, what is the most important decision a business can make? You may believe that it is crucial to develop the right product or service, maybe product or service pricing is key or perhaps selecting the software product? These things may all be important, but for me, the most important decision a business can make is hiring the right staff. It might sound a bit dramatic, but there are a lot of similarities between selecting the right marriage partner and hiring the right staff member – get it right and it’s bliss, get it wrong, then you can be in a world of pain which is expensive and often difficult to get out of.
I can easily recall examples of both situations: how great it felt to have the right person with the right skills and personality fit well into the business and how easy and enjoyable it was to work with that person as compared to making the wrong hire and the associated time and effort required to manage and eventually release the person. Personally, I can think of three really bad hiring decisions I made over the years which cost the business dearly and so I thought I would share the two key mistakes I made which lead to these bad appointments.
The first mistake accounted for two of the appointments and I am ashamed to say for the same role! I was managing an international business from Australia that had 12 staff based in the US and urgently needed a local Supervisor. The HR Manager identified a list of 10 candidates from which I created a shortlist of four and interviewed each. To be honest, I was not especially impressed with any of them, but two stood out from the rest and I made the fatal mistake of believing that I had to select someone from the shortlist so chose “the best” from a bad bunch. Within the probation period, it became apparent that my choice had been poor but instead of starting from scratch, we went back to look at the second person who turned out to be even worse and so also left within a short space of time. Lesson number one: never believe that you have to recruit from the list of candidates you are given, unless you are convinced the person will be good for your business don’t proceed.
The second mistake I made followed an interview in which the candidate appeared to be an almost perfect fit: he was knowledgeable, personable and very keen to work with us. We asked him for references and followed up with the names he provided which turned out to be former customers and received excellent reports from each of them. However, during the probationary period, this new hire was unable to deliver on key commitments and in the end, had to be released. We subsequently found out from a former employer that he had experienced exactly the same thing – the individual would do pretty much whatever a customer asked irrespective of the guidance or instruction(s) provided by his own boss. Lesson number two: always do reference checks with previous employers!
All three experiences were very costly and there is a lot of data around to indicate that the cost of a bad hire can range anywhere from 40% of salary to over 500%. Given that hiring the right person is such a critical decision, it never ceases to amaze me how little effort is typically put in to this vital activity. It is essential to fully define your role requirements and properly prepare for any upcoming interview(s). Undertaking proper interview skills training is unfortunately woefully rare and personality profiling or psychometric testing can significantly de-risk the overall process.
Please get in touch if you would like to learn more about this crucial topic.
Ian Ash ACC, AInstIB
Managing Director OrgMent Talent Solutions - www.omtalent.com.au