03 Aug Why Fit Matters – Understanding the Cost of a Bad Hire
We’ve all made mistakes in the workplace – The email that sent too early and of course, showing up to a meeting unprepared. Unfortunately, it happens. However, few mistakes cost more and occur across the entire organization than a wrong hire.
The real cost varies among organizations, but one thing is certain – adding the incorrect person to your team is a costly mistake. Zappos CEO, Tony Hsieh, estimated bad hires cost the company over $100 million. The U.S. Department of Labor estimates the price for a bad hire is upwards 30% of the employee’s salary. Established companies can’t afford the price, and for a small company, a $30,000+ investment in the wrong person is a threat to the business.
When a recruit turns out to be a lemon, it can be a hard blow, not the least of which is financial. On average, finding a new employee takes five weeks. If you need to fill a management level position, that number raises for 7.5 weeks. From finding a replacement to training and onboarding, there are several additional costs incurred including:
• Recruitment costs and staff time for interviews/onboarding
• Relocation and training fees
• Litigation Fees
Financial impacts are easily quantifiable; however, the effect of a bad hire extends far beyond purely financial implications – morale and productivity suffer. 60% of Managers report that bad hires don’ get along with the team. This holistic impact is commonly referred to as emotional contagion. As performance and morale start to slip, the issue grows, and discontent can become contagious across the team. A bad hire can end up costing you your best talent permanently as the work environment fails to meet their expectations.
Additional non-quantifiable impacts by a bad hire include:
• Negative impact on team performance
• Disruption on current projects
• Impact on customers and brand
Hiring Right, Every Time
Leverage industry specialists to ensure that you have the best individual for your role.
We start at the beginning and work together with you to understand your needs and find the best fit for your team. Our work begins with the job description. One of the top reasons new hires burn out is the result of the job description not meeting the job criteria. We learn about the role and the team to create a laser-focused description that focuses on the skills and competencies required.
In today’s market, there are more jobs than job seekers which makes finding the right recruit even harder. We leverage our database of over 200,000 professionals to evaluate the best fit. We assess and thoroughly vet top candidates to ensure they have the skills and expertise necessary to be a top performer on the team. In addition to a traditional interview, we conduct evaluations to test their ability further.
Have a spot on your team and need a skilled professional? Contact us to get started.