50% of new hires only stay for up to six months.

Yes, that’s right. According to the US Department of Labor Statistics we fail in our hiring decisions half the time. 

Making a poor hiring decision can significantly impact your business. A bad hire can cost up to 30% of the employee’s first-year earnings1. Additionally, 80% of employee turnover stems from suboptimal hiring decisions2. leading not only to financial loss but also to decreased team morale and productivity.

The repercussions can be multifaceted, from the tangible costs of rehiring and retraining to the intangible, yet profound, impact on team dynamics and company culture. The true cost of a bad hire, therefore, encompasses both immediate financial setbacks and long-term organizational challenges.

To avoid bad hiring decisions, consider these steps:

  • Understand What You Need: Clearly define the role’s responsibilities and the ideal candidate’s personality traits, as successful individuals in similar positions within your organization may provide valuable insights​​. But don’t stop there. If the role requires specific skills that you and your team are not familiar with, use a hiring platform that can use AI to define the skills, provide context, and even rank the skills in importance.
  • Objective Hiring Methods: Use structured interviews, interview scorecards, and assessments to minimize bias and objectively evaluate candidates. Note-taking during interviews also helps in recalling specific candidate responses and making more informed decisions​​, but few interviewers caen talk and take notes simultaneously. Use a platform that has AI to automatically gather information as the interview progresses.
  • Evaluate Your Hiring Process: Learn from past mistakes by reviewing the performance of your individual hiring team members based on their capability to pick candidates that have been winners.
  • Consider using pre-employment tests to narrow down your candidate pool to those who truly fit the role’s requirements​​. 
  • Review all your hiring team feedback as a whole – as well as individually. Unconscious biases often color team member feedback. It doesn’t have to be as identifiable as racial or gender based. It can be because the interviewer and candidate went to the same school, or like the same music. 
  • Diversify Candidate Sources: Look beyond generic job boards. Utilize industry-specific platforms, internal referrals, and possibly consider promoting from within to find top talent​​. Again, use data you’ve gathered over past hiring events to help define the best sources.
  • Assess Technical and Cultural Fit: Ensure candidates not only possess the necessary skills but also align with your company’s values and culture​​.
  • Verify Information and Red Flags: Thoroughly check candidates’ backgrounds and be cautious of any red flags during the interview process​​.

By integrating these strategies and selecting the right Hiring Process Management System into your hiring process, you can significantly reduce the likelihood of a bad hire, ensuring a more effective and cohesive team.

1 U.S. Department of Labor. 2 Harvard Business Review.