Why We Make Bad Hires 

Too often, companies make hiring decisions with too little thought, despite the risks that bad hires can bring. Truth be told, every employee’s contribution matters. In a new report, StevenDouglas offers some key considerations to keep in mind when evaluating the effectiveness of your hiring process.

August 2, 2021 – Finding good people is one of the toughest challenges for business owners and managers. Turnover has an immediate and often devastating impact on the bottom line, according to StevenDouglas’ Donald Zinn. If you have a sales force of five people, for example, each represents 20 percent of your potential annual revenue, he says. If one or two leave, there’s a good chance you won’t make your yearly goal. Every employee’s contribution counts

“A growth-oriented company requires a very special team to realize its full potential,” Mr. Zinn said. “To succeed, the business must be incredibly adaptable and make sustainable decisions. The kind of employee who thrives in this environment is not easy to find. Yet, we tend to make hiring decisions too easily, as if they are an easy asset to not only identify, but acquire.”

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Mr. Zinn points to three questions you should ask to evaluate the effectiveness of your hiring process:

  1. Do you do a thorough search to find the best person for the job or are you too often settling for the first person who comes in the door who meets minimum criteria?
  2. Do you understand what your “must-have” qualifications are for the job so you have a logical barometer to measure candidates rather than merely making a gut decision?
  3. What is the cost of training and getting a new employee fully up-to-speed at your company?

“Companies need to understand the true cost of a bad hire in order to determine how to budget for the recruiting process,” said Mr. Zinn.

Your Most Important Decision

“Don’t cheat yourself here – for your company, there is no more important decision than making the right hire, and the search process is critical to that decision,” Mr. Zinn said. “The opportunity cost (of failure) is far too great – and for small and middle market companies, that opportunity cost is magnified by the precious time spent not making progress on an essential role that needs to be filled that you can never get back.”

Why does the typical process fail so often?

We make decisions in 90 seconds, according to Mr. Zinn. “Research indicates most of us make up our minds during a first impression and then use the rest of the interview to back up our initial judgment,” he said. “First impressions are important and you do need to trust your gut, but trusting it and relying solely on it are two different things. Don’t rush to judgment and make sure you create a logical case for saying ‘yes’ and making that hire. Develop your scorecard in advance – liking the person is one area you certainly want to score, but you need to base this decision on more than that alone.”

We fall in love with the resume. “Experience is not expertise and it sure isn’t attitude,” Mr. Zinn said. “You are hiring a human being who is going to be successful in only a certain kind of environment— regardless of his or her contact base and experience. Make sure you understand what it will take for the candidate to succeed— and how to manage the candidate so they will. Don’t overlook the fact that a resume is a chronology, and what is most important is the solution that candidate presents today. And remember, the contacts and network the candidate has are only as good as their relationship development and management skills are.”

Related: Why Delaying Succession Plans in Times of Crisis Can be Risky

“We don’t interview for behaviors,” Mr. Zinn said. “We lack the questions needed to create an open discussion where we really get to understand how the candidate thinks, reacts and behaves.”

Donald J. Zinn is senior vice president – executive search and a senior member of the StevenDouglas search team. Mr. Zinn focuses on helping early stage, middle market, and fast-growing companies build optimal and functional leadership teams with a focus on creating scale. He holds a BS in industrial & labor relations from Cornell University and an MBA from New York University.

Mr. Zinn notes that we comfort ourselves with a group decision. We do not create a structured interview process, and so rather than getting three or four different perspectives, we get one perspective three or four times because we all ask the same questions.

“We leave the candidate in his or her comfort zone,” Mr. Zinn said. “By asking the standard questions, candidates have a distinct advantage. They are comfortable and in control, while we, the interviewers, are not. Interviews require questions that enable us to dig deeper and force candidates out of their comfort zones so we can see if they think on their feet and respond to questions in a favorable light. Prepare a few questions that are outside of the box.”

  • Don’t ask: Tell me about your strengths.
  • Ask: What makes your strengths different than someone who has a similar background to yours?

“We don’t take the time to figure out what we really need,” Mr. Zinn said. “The position description is not the same as the ideal candidate profile. Take the time to understand the ideal candidate profile and how much room around that ideal you have before you get yourself in trouble.” The rule is simple:

  • Skills matching can be approximate — people can learn.
  • Behavioral matching must be dead on — people don’t often change

“If you see anything in the above reasons for hiring failures that reminds you of your interview or hiring process, it’s time for some changes,” said Mr. Zinn.

Established in 1984, StevenDouglas is a boutique executive search and interim resources firm. Its client base is industry agnostic and ranges from start-ups and emerging middle-market to Fortune 500 companies and private equity firms. StevenDouglas has experience in a variety of key areas of expertise, as well as rapid-growth, highly competitive practices, such as IT staffing and consulting. The firm is headquartered in Miami.

Related: Skills Gap Points to Why We Need to Invest in People

Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media

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