9 Ways Smart Business Owners Avoid Bad Hires

Updated on 22 June 2016

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Businesses around the world spend an absolute fortune on ‘rotten apples’ and this doesn’t even take into account the indirect ways these businesses pay for hiring the wrong employee. Productivity, employee morale and client satisfaction are all at stake!

According to the Harvard Business Review, a whopping 80% of employee turnover is due to bad hiring decisions. Another survey, this time by job search site, Monster, revealed that on average, small business owners spend $1,872 (R28 617,82) to hire someone new.

If this isn’t ‘scary’ enough, research done by The National Business Research Institute reveals that 66% of employers said they experienced negative effects of bad hires. Of these employers, 37% said the bad hire negatively affected employee morale. Another 18% said the bad hire negatively impacted client relationships. And 10% said the bad hire caused a decrease in sales. What’s more, 43% of respondents cited the need to fill the positions quickly as the main reason that bad hires are made.

Statistics aside, a bad hire – someone who negatively impacts organisational productivity, performance, retention and culture – can be avoided.

“Don’t ignore nagging concerns that you may have”

1. Be specific: In addition to a job description, profile your ideal candidate. Define the traits needed to excel in your organisation. Get your employees involved in this process. They often have great insights on what kind of person would work well in the team.

2. Pre-determine your criteria: Just like a pros and cons list, write an ideal candidate list. In the one column, list your non-negotiables in terms of personality, in the other, the skills needed to get the job done.

3. Interview right: Ask behavioral-oriented questions, which are questions that require a response based on actual experience. Also, ask the candidate if he or she has any questions. The questions they have will tell you a lot about them and what is important to them.

4. Don’t settle: While it may be tempting to give a candidate that only meets half of your pre-determined criteria a chance, rather wait it out until the right person comes along.

5. Trust your gut: First impressions are the ones that count. Don’t ignore nagging concerns that you may have. Listen to that voice in your head and trust your instinct.

6. Reference check: Contact your candidate’s references via phone. You’ll be able to gauge from the reference’s tone of voice if they were well-liked and if they did what they say they can do.

7. Social Media: Do some digging on social media to see what the candidate is really like, away from the interview room.  According to a 2013 survey by the Society for Human Resource Management (SHRM), 69% of recruiters that screen via social media rejected applicants based on their profiles.

8. Social Recruitment: Just because the candidate stood on a street corner with a CV and plea for assistance, doesn’t mean they’re right for you.  Even if their post received thousands of shares, think with your head, not your heart.

9. Onboarding: Keep in mind that companies with a strong onboarding process improve new hire retention by 82% and reported a more than 70% increase in productivity according to research conducted by the Brandon Hall Group.

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