We here at HRM are completely passionate about people, and boy, getting this right is so important. When you’re selecting talent it doesn’t start with the job posting and end when the candidate signs their offer letter. Really, successfully choosing talent should be a structured process that begins with a clear, well-defined and justified definition of what the appropriate knowledge, skills, and abilities are as well as attitudes and just having a good fit culturally. We all have a big role in that, so it doesn’t matter if we are an HR professional, a hiring manager, or anyone involved in the hiring process, it is an awesome responsibility to pick talent. We’ve probably all had many successes and failures along our careers in doing so.
There are a few things I want you to be able to do at the end of this session, so our objectives are to:
- Express the implications of bad hires as well as the benefits of great hires.
- Conduct a job analysis developing a job profile and defining competencies.
- Define the required components of an effective selection system.
- Contrast illegal interview questions and their legal counterparts to limit liabilities.
Carry out an effective onboarding process engaging employees early in the hiring process.
I’m sure most of us have heard, but a new hire will know by their first 6 months whether they want to stay with a company or not.
Today we have this session broken into three categories:
- Why Hire Well
- Selecting Talent
- Orientation & Onboarding
I want you to really think about your current hiring process at your organization. I’m sure there have been some issues in the process, so let’s look back at that and maybe we can see where some things went wrong. Let’s think about these things:
- Did you settle on a candidate?
- Did you overlook red flags?
- Did you ask the wrong questions?
- Did you not set him/her up for success right away?
- Were the issues not addressed early on?
I’m going to first focus on why we hire well. I’ll share a personal story about my best hire, my worst hire, and I’ll also share how that person added value to the organization, or how they drained valuable resources.
My first story is my best hire and this was early on in my career. I used to work as a retail manager in a large athletic shoe and apparel chain. Retail is a tough gig; you work a lot of hours such as evenings, weekends, and even holidays. If you don’t have a good team in place, you inevitability have to work more hours which could become draining and could lead to quick burn out. So the best Assistant Manager I ever hired was a guy named Matt. This dude was full of energy, always willing to help his teammates, and man, he provided great customer service to everyone who walked in the door. He was really the epitome of what we desire in our employees. He not only had experience previously and awesome references, but he had enthusiasm and a great outlook on life. So picture this - this is your Assistant Manager, your right hand person when you’re not there, this is somebody you want to lead and develop over time. What was cool about Matt is he really affected a lot of other people as well. We ended up being one of the most successful stores in the country. Each of our team members was really valued and everyone knew we had a great team going on. Matt really influenced the other people that he worked with and he really set the bar. So he ended up getting promoted and promoted, he ended up running one of the largest stores in the company, and now he is an executive with the company.
So traversely, one of my worst hires. I used to be an HR manager at a mortgage bank and for this particular position I was not the hiring manager, but I was a decision maker in the process and should have been held accountable for the bad hire. This person was a referral from another employee who pretty much begged the hiring manager to give this person a shot. The hiring manager had a soft spot and came to me and said “Hey, I’ve got this person, I want to give them a shot. They don’t have the best experience, but we don’t have a lot of other candidates right now.” So my advice was ‘ok, let’s put this person through the process and let’s see if they’re a good fit’. Well, we ended up not completely following our process and guidelines and ultimately, we made some exceptions to the criteria. The person was hired and ended up having a lot of problems. Ironically, the problems didn’t start until after the 90-day probationary period. After the probationary period we had issues with time off, there were performance issues, and also we had some interpersonal issues with others in their department. This really wasted a lot of time and effort because we had to take the person through the discipline process and eventually replace that person. This affected engagement for the entire department and it was certainly a great lesson we learned afterwards. As a team we debriefed and decided we couldn’t let that happen again.
What I want to do next is I want to look at the cost of a poor hire. First let’s look at the time aspect:
- Recruiting and hiring a replacement
- Training and orientating a replacement
- Managing performance and expectations
- Decreased morale, engagement, productivity, quality of work
- Burden to other employees - required overtime
Next I want to talk about money:
- Advertising and marketing the new position
- Interviewing, testing, and assessing candidates
- May cost you a customer due to bad service
- Loss of institutional knowledge
- Hourly - Cost up to 30% of an annual salary
- Salaried - Cost of 1 to 3 times an annual salary
Let’s look at an example of this.
$10/hour = $20,820/year x .30 = $6,240
$6,240 x 10 people in 1 year = $62,400
$50,000/yr - $150,000/yr for one exempt level position
On the flip side, let’s look at the value of a good hire. There is inevitably going to be increased contributions and new ideas. When you make a good hire, you’re hiring them for a reason. Maybe they’ve got great skills or great experience and that is really going to help with idea generation and overall a great experience. This can also increase customer satisfaction as well as revenue. Lastly, it can increase productivity and employee morale. My example of my best hire with Matt, he definitely did that because he just had a really good influence on other people and he led by example. So all of these when you look at them together, the result is increased employee engagement.
Let’s look at selecting talent. We’re going to jump into this section and give you a good overview of a recommended hiring process. There are certainly a lot of steps in the hiring process, but it all begins with a job analysis. So you create a job profile and determine the most important competencies for the role as well as transferable skills and education. So look at these things and determine what is most important. Next you will look at the job requirements. You’ll create a job description from that and post it. We always recommend there is some compensation research as well. Look at comparable salary data in your area and just make sure your competitive.
Next comes the sourcing process, and you’re going to want to make sure you market the position in a variety of applicable sources. Next, you’re going to do resume sorting and determine who to interview. We always recommend that there is some type of pre-qualifying such as a phone screen first. From there you will narrow it down to the top candidates to bring in for the onsite interviews.
Now we have onsite interviews and this can be very different for different organizations. Some use a lot of people while others use only a couple people to make a decision. A big piece that you have to look at is the cultural fit. This is not only with the organization, but with the department and maybe even the leader. Lastly, we always recommend that you use structured interview questions and valid assessments.
Come back on Wednesday for part 2.