April 23, 2013
With increased competition and tighter labour markets, organizations are under extreme pressure. The need to hire the right talent to sustain and grow your organization, while controlling costs and increasing profits, create an administrative challenge. International consulting firm Watson Wyatt quantifies the cost of losing an employee at as much as 200% of that employee’s salary. In addition, Workplace Resource Learning Centre estimates that a poor hiring decision can cost of $66,000.00 for an employee with a College / University degree. These costs combined with the standard operational expenses of salary, benefits, and office space reinforce the need for employers to value their talent.
The key factors in successful hiring are to understand what candidates are looking for and the hiring process used. Attitudes and needs differ according to generational diversity (Boomer’s vs. Gen X’ers), financial status, and required working environments. A formal, consistent, well-developed hiring process is essential in the race for talent. A traditional interview yields only a 14% accuracy rate, so it’s no small wonder that when surveyed, 90% of people indicate they hate to interview. If investing the time to learn to develop a formal hiring process for your organization can increase your success rate to 45 or 50%, how much of an advantage will that give you over your competition for talent?
Assuming then, you have implemented a structured hiring process, does that solve your turnover and staffing problem? You have only just begun. It is not enough to hire the right people. The hard part is to keep them.
Most organizations fail to understand the basics of building trust and loyalty in the work environment. Professionals need to treat their investment in HR programs the way they do capital investments and work out the return on those investments. Without personal or organizational change or improved productivity and performance, organizations can anticipate a net loss in customer base and a direct impact on the bottom line. A focus on improved communication and understanding removes the barriers, builds employee trust, and results in improved loyalty. Ten of the most common mistakes made when hiring and managing staff are outlined below.
The management of human resources must be a key component in any management strategy regardless of the size of the organization. It is no longer only the responsibility of larger employers. Documented policies and procedures, consistent and valid processes, formal performance management and staff development plans all must be part of annual business planning. Only those organizations who implement these strategies now will continue to enjoy growth and financial prosperity in the future.