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Finding qualified candidates for open positions is one of the most important aspects of a successful organization. Hiring the wrong person can cost a company both time and money for a multitude of reasons. In a survey conducted by CareerBuilder in Canada, it was determined that a bad hire ends up wasting 27 weeks of an organization’s time, including an average of 7 weeks to put a replacement in place.  By implementing key hiring practices, bad hires can all but be avoided.  

Some of the costs associated with a bad hire include:

  • The Recruiting Process
    An organization’s recruiters or hiring managers must post the job on relevant job boards for the candidates they are trying to attract. Not only is this time consuming when posting in multiple places, it typically costs money to advertise job postings, adding to the expenses associated with recruitment. Once applications start coming in, the recruiter must then spend their time screening the resumes and scheduling interviews for a time that works for both parties.  
  • Interviews
    Interviewing can be a tedious and time-consuming task. Often a hiring manager has to interview multiple applicants in order to find the right fit. In many organizations, candidates who pass the first round of interviews are often required to have another interview for a second opinion, adding to the time spent to find someone to fill each position.  
  • Onboarding
    When a candidate starts with an organization expenses are incurred involving everything from equipment to setup time. Providing new employees with devices such as phones and laptops, as well as the time it takes for HR and benefits set up can be costly.  
  • Training
    Once the candidate has been chosen, significant time and effort is invested in training that individual. Training often involves other employees spending time getting the new hire up to speed on processes which takes their time away from their daily tasks.  
  • Impact on Current Employees
    Not only do current employees often have to spend time training new hires, if that individual is not a good fit for the organization it can cause problems with the company’s culture. If the new hire isn’t productive enough, the rest of the employees end up picking up the extra work causing unnecessary stress.

With 86 percent of business owners admitting that they have made a bad hire, mitigating the chances of making a mistake during the hiring process is top of mind for many organizations. To help avoid hiring the wrong person, establish a streamlined screening program that includes the following steps.

  1. Have a referral process so that current employees can be rewarded for recommending candidates that would be a good fit for an open position within your company. Your best employees likely have a friend or former colleague that may share attributes that would be a great fit for your organization. In a survey conducted by Robert Half, 56 percent of businesses said their best new hires came from internal referrals.
  2. Ensure that your evaluation and interview process it thorough and well established ahead of time. By creating a list of basic requirements, hard and soft skills as well as hiring manager preferences, it will be easier to decide whether the applicant will be a good fit for the position. Have more than one person interview each candidate or consider a team/panel interview to allow the candidate’s potential colleagues to get an idea of what it would be like to work with them.  Design the interview questions in a way that requires the candidate to provide specific examples to demonstrate their skills and qualifications. Questions that can be answered with just ‘yes’ or ‘no’ will not provide you with adequate context or information to make an informed decision.

    Ensure you provide prospective employees with the opportunity to ask questions – about the company, about the role, and about their expectations around remuneration and total compensation. In many cases, the cause of a bad hire can stem from a lack of open communication around expectations.  
  1. Have a well-documented background screening policy. Once you have found the successful candidate after the interview process, it is vital that you conduct a background check to verify their qualifications and experience. With 85% of candidates exaggerating skills and competencies on resumes, an employer cannot rely on what they see on paper.  

As part of your screening policy, you should have defined searches for each position. Canadian criminal record checks are typically done for all positions, checking for convictions that are recent and relevant to the position. Employment and education verifications help to confirm if the candidate has the required experience and skills needed for their job. Regardless of how well you know the person you are hiring, eReferences should be included as part of the background check in order to help identify any red flags in their previous job history.  For more information on essential components of an effective background screening process, check out this article.

The estimated cost of a bad hire is somewhere between 1.5 to 3.5 times their annual salary. Taking into account the costs associated with onboarding and offboarding a person, such as posting the position, the time spent on hiring, onboarding and training, potential loss because of theft of property or time and loss of productivity, having processes in place that help to reduce the risk of making the wrong choice are essential to an organization’s bottom line. To learn more about how ScreeningCanada can help reduce the chances of making a bad hire, reach out to our product team.

Finding qualified candidates for open positions is one of the most important aspects of a successful organization. Hiring the wrong person can cost a company both time and money for a multitude of reasons. In a survey conducted by CareerBuilder in Canada, it was determined that a bad hire ends up wasting 27 weeks of an organization’s time, including an average of 7 weeks to put a replacement in place.  By implementing key hiring practices, bad hires can all but be avoided.  

Some of the costs associated with a bad hire include:

  • The Recruiting Process
    An organization’s recruiters or hiring managers must post the job on relevant job boards for the candidates they are trying to attract. Not only is this time consuming when posting in multiple places, it typically costs money to advertise job postings, adding to the expenses associated with recruitment. Once applications start coming in, the recruiter must then spend their time screening the resumes and scheduling interviews for a time that works for both parties.  
  • Interviews
    Interviewing can be a tedious and time-consuming task. Often a hiring manager has to interview multiple applicants in order to find the right fit. In many organizations, candidates who pass the first round of interviews are often required to have another interview for a second opinion, adding to the time spent to find someone to fill each position.  
  • Onboarding
    When a candidate starts with an organization expenses are incurred involving everything from equipment to setup time. Providing new employees with devices such as phones and laptops, as well as the time it takes for HR and benefits set up can be costly.  
  • Training
    Once the candidate has been chosen, significant time and effort is invested in training that individual. Training often involves other employees spending time getting the new hire up to speed on processes which takes their time away from their daily tasks.  
  • Impact on Current Employees
    Not only do current employees often have to spend time training new hires, if that individual is not a good fit for the organization it can cause problems with the company’s culture. If the new hire isn’t productive enough, the rest of the employees end up picking up the extra work causing unnecessary stress.

With 86 percent of business owners admitting that they have made a bad hire, mitigating the chances of making a mistake during the hiring process is top of mind for many organizations. To help avoid hiring the wrong person, establish a streamlined screening program that includes the following steps.

  1. Have a referral process so that current employees can be rewarded for recommending candidates that would be a good fit for an open position within your company. Your best employees likely have a friend or former colleague that may share attributes that would be a great fit for your organization. In a survey conducted by Robert Half, 56 percent of businesses said their best new hires came from internal referrals.
  2. Ensure that your evaluation and interview process it thorough and well established ahead of time. By creating a list of basic requirements, hard and soft skills as well as hiring manager preferences, it will be easier to decide whether the applicant will be a good fit for the position. Have more than one person interview each candidate or consider a team/panel interview to allow the candidate’s potential colleagues to get an idea of what it would be like to work with them.  Design the interview questions in a way that requires the candidate to provide specific examples to demonstrate their skills and qualifications. Questions that can be answered with just ‘yes’ or ‘no’ will not provide you with adequate context or information to make an informed decision.

    Ensure you provide prospective employees with the opportunity to ask questions – about the company, about the role, and about their expectations around remuneration and total compensation. In many cases, the cause of a bad hire can stem from a lack of open communication around expectations.  
  1. Have a well-documented background screening policy. Once you have found the successful candidate after the interview process, it is vital that you conduct a background check to verify their qualifications and experience. With 85% of candidates exaggerating skills and competencies on resumes, an employer cannot rely on what they see on paper.  

As part of your screening policy, you should have defined searches for each position. Canadian criminal record checks are typically done for all positions, checking for convictions that are recent and relevant to the position. Employment and education verifications help to confirm if the candidate has the required experience and skills needed for their job. Regardless of how well you know the person you are hiring, eReferences should be included as part of the background check in order to help identify any red flags in their previous job history.  For more information on essential components of an effective background screening process, check out this article.

The estimated cost of a bad hire is somewhere between 1.5 to 3.5 times their annual salary. Taking into account the costs associated with onboarding and offboarding a person, such as posting the position, the time spent on hiring, onboarding and training, potential loss because of theft of property or time and loss of productivity, having processes in place that help to reduce the risk of making the wrong choice are essential to an organization’s bottom line. To learn more about how ScreeningCanada can help reduce the chances of making a bad hire, reach out to our product team.

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