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How to avoid the dreaded “bad hire” in 2020

Jan Schwarz, co-founder of Visier

Bad hires are bad for business.

There’s nothing worse than going through a long, drawn-out interview process, choosing a candidate who shows a tremendous amount of promise, only to realise that hiring them was a mistake. According to the UK’s Recruitment & Employment Confederation, a bad hire can cost up to £132,000 in lost productivity and staff turnover.

It’s a well-established problem. But what can we do about it?

First and foremost, I believe our industry is plagued by an overreliance on fundamentally flawed technologies like Applicant Tracking Systems (ATS). While there is no question such tools are helpful in getting candidates through the door, the big issue is that ATS does not provide a complete and accurate view of how well candidates perform after being hired.

To paraphrase Rachel Botsman, Trust Fellow at the University of Oxford's Saïd Business School, bad hires usually occur when hiring managers conflate ‘confidence’ with ‘competence’ during the interview process. To avoid this trap, hiring managers must reassess their relationship with ATS and turn to other data-driven tools that help them track new hires across the employee lifecycle in order to really discover what makes an effective job candidate.

 So, how can companies reliably differentiate between ‘bad’ and ‘good’ hires? How can better access to data help them make better decisions? To start, here’s four simple steps.

 1.     Align candidate metrics with business success

Let’s face it, some organisations get so concerned with filling roles that they very rarely question what value that role is delivering first place. Before embarking on the interview and selection process, hiring managers need to constantly question whether certain candidate criteria will actually help their business achieve its strategic goals.

Instead of deferring to an ATS, hiring managers should turn to existing workforce data to understand what makes a ‘top performer’. This information will help craft the optimal job description, interview questions and skills assessments for attracting and hiring the perfect candidate.

 2.     Compare pre-hire and post-hire data

The pre-hire data captured in an ATS, which sheds light on a candidate’s potential, is only useful if you can compare it with data that analyses actual performance. After all, someone who was a top performer during their probation is not always guaranteed to deliver once they have passed that initial milestone.

Whether your team performs this analysis on a monthly or quarterly basis, refreshing and reanalysing data in real-time ensures HR leads are working with the best possible metrics for future hiring.

3.     Test workforce planning scenarios

As the name suggests, ATS is a great tool for tracking – but not for planning. Using historical data from past and present top-quality hires, hiring managers can forecast how long it typically takes to hire quality candidates and test whether these processes are still sufficient in different hiring scenarios.

Those scenarios might include an unexpected talent shortage that requires a more compressed hiring timeline or poor financial performance that affects the compensation you can offer top talent. Armed with this insight, hiring managers can avoid surprises and be prepared to adjust their recruitment strategies if and when the time comes.

4.     Measure the impact of the candidate experience

Finally, and perhaps most importantly, one thing an ATS can’t tell hiring managers is whether candidates are having a positive experience. It has been well documented that high-quality talent is more likely to leave a company because of a ‘bad experience’ than their remuneration package.

In today’s age of data-driven recruitment, hiring managers need to expand their horizons and use solutions that connect all their workforce data from multiple systems together. Only then can they get a full and accurate picture of the organisation’s end to end employee experience.

Because the best way to avoid making a ‘bad hire’ is to avoid losing your ‘good hires’ in the first place.

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