Making the Right Hire

Even 10 years ago, having an excellent product or service at a good price was enough for you to be competitive and successful. Today, with the increasing use of blogs, online review sites, and social media, that is not enough. Our employees define the brand and we rely on them to deliver amazing customer service to ensure our product/service is sold to returning, loyal customers who in turn recommend our product/service to their friends. The culture of an organization is also reliant on having like-minded employees who support each other. Hiring the right person is crucial, not only to ensure no loss of productivity or profit, but also to continue to support the company culture.

Sometimes, however, we find ourselves needing to fill a position quickly and we rush a hire without researching the prospect’s skills or checking references. This may turn into a bad hire, with characteristics such as failing to produce quality work on-time, having a negative attitude, and not working well with others or with clients. The result of this one bad apple can include a decrease in productivity, loss of customers and revenue, disruption in team dynamics, decrease in morale, and loss of valuable team members, all of which can negatively impact company culture and profitability.

Having to fire and rehire is time consuming and costly. Find out how much a bad hire will cost you using this “Bad Hire Calculator“. Just to give you an idea, I thought I’d see what it would cost to replace an entry-level $25K salary hire using realistic yet conservative numbers and found that it costs nearly $43,000 for this bad hire to work for 8 months. If that wasn’t shocking enough, this number does not take into account the cost of firing them or the total decrease in productivity! Research from Careerbuilder.com has shown that 41% of companies have had a bad hire that has cost them at least $25,000 while 25% report a bad hire costing them over $50,000.

So how can we ensure that we bring on the right person? Get to know them!

Personality Assessments

Sixty-one percent of employees hired using a personality assessment became top performers within 12-14 months compared to just 7% of those hired without using a hiring tool. There are a variety of personality assessments out there, all of which identify certain characteristics or traits of our personality. Many are preference based and cannot be used for hiring decisions.  Arguably the most well known of this type of personality assessment is the Myers-Briggs Type Indicator or MBTI. There is still value in using these assessments, as I discuss in this article. However, using a behavior-based personality provides a practical analysis of an individual’s personality and can be used as a tool in the hiring process. We use our own assessment, the Multi-Rater Personality Inventory (MRPI),  to better understand personalities as a hiring tool. It has a high validity and reliability, correlates strongly against competencies, and is designed in a way that makes skewing the results nearly impossible. Even so, our assessment is used as part of the hiring process. It helps address concerns our clients might have about an applicant from their interview or references, as well as providing an idea of how the applicant will work in the company’s culture. Finally, it identifies potential areas of concern that will help their new manager understand how to better coach them should they be hired.

The Interview and References

Being an excellent entrepreneur, business owner, or leader does not mean you are a great interviewer! In fact, Greg Witz is the first to admit that interviewing candidates is not his strong suit. This does not mean he is not involved in every interview, rather he relies on another member of the team to ask the right questions. Having two people present during interviews is a good practice as it allows for different perceptions of a candidate to be discussed. What you ask will vary depending on your industry, but avoid the questions that simply require the candidate to regurgitate their resume. Use questions that challenge their abilities or show creative problem solving. This is also your opportunity to get to know the candidate and see if their personality will fit with your company culture. Business News Daily has some great questions to help in learning more about your candidate here.

Zingerman’s, a $44.9 million group of businesses in Ann Arbor Michigan, has a great policy when it comes to interviews: If the candidate doesn’t smile when they first meet the interview team, they don’t get hired. If you are not happy and excited to be at an interview, odds are you won’t be happy and excited about coming to work either. Similarly, you want candidates who ask questions at the end of the interview. The best candidates come in with enthusiasm and passion about the company, and their questions should reflect that. Some of the best questions I’ve received are:

• How is success defined for this position?
• What are the greatest challenges your company faces?
• What are some potential career paths within your company?
• In order to retain high quality talent, what do you guys do to keep it fun for the team?
• What do you love best about the culture of the team here?

If we expect our interviewees to be enthusiastic and high energy, then we as interviewers should be as well. This gets difficult on days where you have multiple interviews and the monotony of asking the same questions over and over can take its toll. As humans we tend to mirror those around us, so to get the best out of our interviewees, we need to be at our best as well.

Many employers request references from candidates, yet very frequently the employer never contacts the reference or only calls one reference. Previous employers can give you a great idea of how well the candidate will fit in your company, making these calls worth the time. Of course, speaking to a candidate’s high school friend or personal trainer won’t be particularly useful! Insist on references who are supervisors or clients, ensuring that you are provided with both phone and email. If any reference is hesitant to talk about the candidate or only provides very surface or generic answers, a red flag should be raised. Monster.com has put together a great reference call strategy, complete with questions, in their article Reference Checking: Get Real Information from Reference Checks.