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Powerful ways to Avoid Costs of bad Hiring Decisions

bad hiring decisions

There are many reasons why bad hiring decisions can put a business at risk, including anything from reduced productivity to the potential threat to physical and digital security.

Hiring the wrong person can lead to diminished productivity, as employees without the proper skills may struggle to work under pressure or do the job the company hired them to do. In addition, if an employee doesn’t align with company values and culture, it could lead to disruptive behaviour and distract co-workers, leading to decreased performance and poor results.

Another thing to consider is the adverse effects of having a reputation as an organisation that hires the wrong person. Every company wants to hire top talent, and a poor reputation is a disadvantage to attracting the best people for your organisation.

Moreover, the SBA (U.S Small Business Administration) states that it can cost an organisation up to 1.4 times an employee’s salary to hire a new staff member. This cost assessment could be higher as it doesn’t consider additional employee financial expenses such as relocation costs, onboarding, healthcare and pension contributions. In addition, other expenses include job site advertising, recruitment fees etc.

This article covers the costs and consequences of a bad hiring process, considering the causes of poor recruitment and selection. In addition, you will learn how to assess a bad hiring process so that employee hiring, retention and performance improve overall in your organisation.

What are the signs of a bad hire?

Unfortunately, hiring managers often don’t realise they’ve hired the wrong person until the damage has impacted performance or staff morale. The cost of a bad hire can include hurting customer relationships, negatively impacting social media followers, upsetting co-workers and much more.

The signs of a bad hire are any employee that detracts from an organisation’s smooth running and performance. In addition, a low staff retention rate could mean you are consistently hiring the wrong employees.

Initially, a new employee may appear to fit in and do a good job but later becomes complacent or disruptive or makes continual and damaging mistakes. There are so many ways that the consequences of a bad hire can create havoc in your business. Subsequently, identifying bad hiring decisions and making constructive improvements can turn around a bad situation.

In a survey by CareerBuilder, managers said that supervisors spend 17% of their time working with underperforming employees. In addition, 34% of organisations taking part in the survey admitted that they often hired the wrong person because they rushed to fill a job position.

Considering how underperforming employees affect company performance highlights the motivation to understand why these situations occur. Businesses must reflect on multiple factors when considering the financial impact of poor hiring, many of which are not easy to quantify.

While the cost of hiring mistakes is genuine, no organisation wants to face the prospect or the time-consuming job of implementing significant changes to a hiring process.

It’s important to understand that the causes of a poor recruitment and selection process begin when you write the job description, which we will cover in this post.


How To Improve Your Hiring Process

You cannot escape the cost of hiring new employees, but it is a business expense. That said, poor hiring decisions may be costing the company more than necessary. The objective for every open job you have is to hire once and hire the right person. In this section, we’ll explore how to avoid common mistakes in hiring by setting up a more effective hiring process.

Create better job descriptions

The worst thing you can do is get someone in HR to write a job description, knowing nothing about the mechanics and intricacies of a job. Suppose your company requires an experienced blockchain developer for a specialised role in a project with a small team led by a blockchain architect. Do you ask the blockchain architect to write the job description? Possibly. It depends on the individual’s skill in conveying all aspects of the job and the specific skills and qualifications required.

Equally, the blockchain developer working on the project might be the person to draft the first copy of a job description. The consensus is to choose the best person according to knowledge, skills and writing capabilities. Alternatively, liaise with the team and gather the information required.

Writing an effective job description that attracts the best candidates is critical to reducing the chances of hiring the wrong person.

Many job descriptions on the market are appalling, not attractive and read like an AI was the writer. You don’t imagine hiring a copywriter to write a job description, but if you have an in-house copywriter, use their skills to write a job description that converts.

Top tips you can apply to job descriptions: –

  • Write conversationally: If you’re a human being writing the job description, write like a human. Write as you speak because there’s no need to add big or complex words other than for technical job specifications
  • Use white space: Split paragraphs into 3-4 sentences at the most. The human brain cannot read big blocks of text, so it scans for salient points.
  • Use bullet points: Again, it makes the text easier to read (scan)
  • List prerequisites first: These are your non-negotiables
  • List “also helpful to have”: Skills or personal traits that would be a bonus to the job role
  • List the salary: Nothing is more frustrating for a candidate than not knowing a salary range. You could reduce the number of unsuitable applicants by clarifying the salary
  • Be clear on soft skills: Many organisations focus on hard skills, but soft skills are equally important in some job roles. For instance, if an employee must work with a team, emotional intelligence, communication and collaboration skills, problem-solving and critical thinking are essential for the smooth running of a project
  • Avoid fluff: Be truthful about the role. Stick to specifics and avoid fillers. Some job descriptions are so long that it’s almost a guarantee that many candidates will not read them in their entirety
  • Add a task: Some companies add an application task in a job description, asking candidates to add a word or sentence to their cover letter. If candidates fail to add these details, it shows inattention to instructions. It’s possible they honed in on relevant areas of the job description and failed to read it fully.
bad hiring decisions
Avoid the costs of hiring the wrong person

Streamline the hiring process

You’ve found a fantastic candidate and are keen to have them onboard. However, your hiring process takes six weeks, and on week three, a competitor snapped up the top talent, and once again, your organisation missed out on an employee that could have made a positive impact.

Speed up the hiring process. Use ATS software to scan resumes to find candidates with the best skills and read their cover letters. Set up a phone interview as quickly as possible. If the interview goes well, tell the interviewee you are interested in them and outline timelines for the next step.

Streamlining the hiring process could be one of the most effective ways to improve a bad hiring process.

Quick Tip: From a psychological perspective, people are less frustrated about waiting if they have a clear timeline. For instance, tell the candidate you will contact them by a certain date or time. If they are interested in the role, they may delay another job offer in lieu of contact from your company.

In addition, most candidates appreciate hiring managers don’t have time to notify all unsuccessful candidates. Still, it’s helpful to tell them their application is unsuccessful if they haven’t received contact by a specific date.

Consider using automated administration tools

Many hiring managers use ATS (applicant tracking system) to scan resumes and filter out suitable candidates. You could accidentally miss out on the perfect candidate, but automating this stage can reduce stress and time. For instance, Web3 jobs in cryptocurrency, the Metaverse and blockchain roles are much sought-after. Hiring managers could receive hundreds of resumes. Filtering resumes manually for suitable candidates is time-consuming.

Consider software that improves workflow automation so hiring managers can spend more time finding the perfect candidate and less time on manual admin tasks. Even think about using automation by setting up an interview calendar for selected candidates so that they can choose a suitable time and date.

Develop better interviewer skills

If your best people aren’t involved in the interview process, you’re missing an excellent opportunity to improve the hiring process. Not everyone has the best interview skills, but it’s possible to learn how to improve the interview process.

Firstly, prepare a list of relevant questions to ask candidates and have a rating scale for answers. You can break the questions down into an initial shortlist so that if it’s clear from the outset that the candidate is not suitable, you can cut the interview short.

Secondly, ensure the interview room is at ambient temperature and that interviewees aren’t sitting with full sunshine in their eyes.

Finally, many candidates dread interviews and are nervous, so they may not give their best in the first few minutes. Train your interviewers to establish rapport, smile, put the candidate at ease and engage conversationally. People present their best selves when they feel relaxed and at ease.

Unfortunately, many interviews are like Hunger Games challenges, breaking down the candidate with inappropriate questions, rude behaviour and an unfriendly attitude. If that’s your current interview process, reverse the approach, and you’ll see far better results.

Offer better employee compensation

The worst approach to the hiring process is to focus on saving as much money as possible and compensating employees poorly for their efforts. You might align compensation packages with industry standards and think that’s acceptable. However, rest assured you could lose top talent to a competitor if they offer a more attractive package.

Too late, you’ve made a bad hire. What now?

hirng the wrong person
Bad hiring decisions can be costly

You realise you have hired the employee from hell and are unsure how to manage the situation. As challenging as it is, the best approach is to meet the problem head-on.

Firstly, determine why the hire is not good: –

  • Is the employee unable to fulfil job requirements?
  • Did you rush through the hiring process?
  • Were red flags ignored or unnoticed?
  • Did the employee falsify their resume?

Secondly, all may not be lost. The first step is to arrange a meeting with the employee and determine what is happening. Regardless of the situation, try to put the employee at ease. Tell them that you noticed they are struggling in the job role and ask if you can provide help to make the job easier.

You may not wish to delve into possible personal issues, but if appropriate, enquire about the employee’s situation outside work. They could have had a relationship break-up, a significant loss or may be suffering from stress or mental health issues.

If the employee is a good team player, has good communication skills and seems to fit with the company culture, then consider if there is another position where their talents could be better utilised. In addition, if they tick all the other boxes, could you offer additional training?

Depending on the outcome, agree to ongoing performance reviews and write your expectations to the employee with a timeline for measurable goals.

If the employee meeting is unsatisfactory, it could be time for disciplinary action, such as a first warning if the employee has proven to be a disruptive poor team player. If the situation deteriorates, always maintain a positive attitude to the problem and take the high road.

Know when to quit

Sometimes a bad hire cannot be resolved. You may have given an employee several chances, and they fail to improve. Still, when do you decide the situation is unresolvable? Here are a few scenarios you might consider relevant for employee termination: –

  • The employee misrepresented their skills, including falsifying details or qualifications on their resume and working experience
  • The employer is a disruptive team player and causes workplace stress
  • The employee is disrespectful to colleagues or customers and ignores warnings
  • The employee fails to follow company guidelines and policies
  • Fighting, bullying etc
  • Repeatedly taking unscheduled time off

If any of the above situations occur, discuss a legal action plan with the HR department.

Conclusion: Powerful ways to avoid costs of bad hiring decisions

If your organisation has a bad hiring process, there’s no good reason not to change the situation because it can help reduce the costs of hiring the wrong person. Ensure you have a great job description and a streamlined hiring process to attract top talent into your business. Train your interviewers to build rapport and learn the best interview techniques.

If an employee isn’t performing, set up a meeting and establish the situation. Consider sidestepping the employee into another role or providing additional training.

Finally, if there is no satisfactory conclusion, you may have no choice but to terminate employment and start again. Reflect on the situation and take necessary measures to reduce the chances of hiring the wrong person again.

Contact the CB Recruitment team who may be able to help with revising the organsations hiring process.

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About Author

Jan Barley
Jan Barley
Jan is a SEO copywriter, brand advisor, content strategist & case study specialist writing for crypto, recruitment, and SaaS companies. Jan lives in the Cotswold's UK with two rescue dogs. Since 2020, Jan has written hundreds of SEO articles for various crypto companies including CB Recruitment & Coin Bureau.
Jan Barley
Jan Barley
Jan is a SEO copywriter, brand advisor, content strategist & case study specialist writing for crypto, recruitment, and SaaS companies. Jan lives in the Cotswold's UK with two rescue dogs. Since 2020, Jan has written hundreds of SEO articles for various crypto companies including CB Recruitment & Coin Bureau.

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