To Hire or Not: The Art of Balancing Quality, Time and Costs
Talent acquisition is under a lot of pressure to hire the best candidates in an increasingly tight job market. But within an organization’s HR or recruitment team, there is the added tension of quality versus efficiency. That is, the struggle to find the highest quality candidate, while balancing the potential cost of an unfilled position and extended recruitment efforts. Much like in manufacturing, many recruiters have to choose between a faster but possibly lower quality option, or waiting to find a more qualified candidate in the long run.
This issue of finding quality workers versus the costs of a bad hire can seem daunting, but if addressed at every stage in the hiring process, its pressure can be lessened. Many recruiters focus primarily on candidate attraction strategies and new recruiting methods. At the same time, many hiring managers focus only on the candidates they are given, and expect recruiters to deliver top-notch applicants every time.
Instead, all partners in the hiring process need to understand how their whole system works, and how quality can be improved at every step. Recruiters need to recognize that their hiring managers are pressed to make decisions quickly, and hiring managers need to keep in mind the pressure recruiters face to source quality candidates the moment a vacancy arises. Because as we’ve discussed before, pressure that leads to hiring the wrong person can be far more costly than we might realize.
Is It Better to Leave the Position Open?
Let’s start with some actual responses from within HR about quality of hire. CareerBuilder’s Candidate Behavior 2015 survey asked which has a higher overall cost: making a bad hire or leaving a position open due to a lack of quality candidates? Among the hiring managers who responded, 57% felt making a bad hire was far more costly than leaving the position unfilled. A further 16% said a bad hire is somewhat more costly, and only 3% described an open position as more costly than a bad hire.
It seems fair to say that hiring managers understand the high cost of a bad hire–which can sometimes reach well into five-figure territory. So why do so many talent acquisition teams still hire the wrong people? This is where the struggle between quality and cost comes into play. Recruiters feel the need to supply candidates quickly, and hiring managers are pressured to choose one of those options sooner rather than later. In many cases the recruitment team simply doesn’t have enough time to source quality candidates before hiring managers make a decision.
Data from CareerBuilder’s report backs this up. In the same survey of hiring managers, they asked respondents to choose the best description of the quality of the candidates they get. Only 20% would describe them as great, while 54% said their candidates were of good quality. A further 24% felt the candidates they had to choose from were just of fair quality. Hiring managers can’t help but make a bad hire if just one fifth of the candidates they have to choose from are truly qualified.
Outside Examples and the Cost of a Bad Hire
Anyone running a production business can understand just how difficult it is to balance quality and efficiency. An open position on the floor means a slow down, even a halt, in one step of the manufacturing process. Should managers fill that role as quickly as possible, to get production back up to speed? Or should they dedicate time and resources to finding the best possible candidate, while production suffers?
This decision is often swayed by production schedules and outstanding orders, as well as their own financial incentives. It often feels easier to look to the short term in these situations: Hire someone, anyone, now to keep the plant running as required. This strategy seems to make sense, as it avoids holding up the production line and keeps the profits rolling in.
But many manufacturers will tell you that a short-term view can come with real long-term costs. Hiring the wrong people can lead to decreases in product quality, or more slow downs as those people may be let go and replaced again. Consumers notice when the quality of your product is declining, and may take their business elsewhere. So the challenge for manufacturers, like recruiters, is that your business can’t operate without people, but having the wrong people in those roles might do greater damage than if the positions are temporarily unfilled.
Focus on Quality from Beginning to End
As we mentioned, recruiters and hiring managers don’t always have the same goals, and they don’t operate in the same way. But if all sides of the talent acquisition process can work together to improve quality, they’ll find their sourcing and hiring efforts lead to better candidate selection. To get to this point, the focus needs to be on improving quality of hire early on.
If you’re a hiring manager, start by reviewing the job descriptions you provide for your recruitment team. How accurate are they? Do they focus on future performance objectives rather than past accomplishments? Let candidates know specifically what kind of achievements you expect from someone in this role. An applicant who reads “Launch new product line and reach 15% market share by end of the year,” rather than, “Must have 5-7 years of marketing experience plus a degree from a top-tier university” will better understand what’s required for this role.
As you’re weeding out candidates with stronger job descriptions, also take time to review the compensation and other benefits you offer. Are they competitive? Will they attract the level of quality you want in a candidate? This also goes hand in hand with your employer brand, as a reputation for offering stellar compensation will let applicants know you’re trying to attract the best and the brightest.
While you’re at it, take time to discuss your employer brand with the recruitment team. Make sure everyone is on-message, and that it’s being shared and spread on the most effective channels. This includes social media and other external sites, not just your own career site. Consider having different members of your team write and send messages like LinkedIn InMail to prospective candidates you’ve already identified as high quality.
Other ways hiring managers and recruiters can improve quality of hire include employee referral programs, a seamless and user-friendly candidate experience, and the build-up of a talent pipeline over time. Some of these efforts will be quick and easy, while others will take time to grow. But recruiters and hiring managers alike should agree that any strategy to improve quality of hire is one worth pursuing.