Guest post by Doug Beckley, Group Leader for Catapult Groups
As a Catapult Group Leader and management consultant, a major focus of my work is helping business leaders get serious when selecting and hiring good people. Lazy and shortsighted hiring processes that prevent business from effectively hiring employees are so widespread in the business world that this has become the norm—and yet, hiring the wrong people is the most important contributor to poor company performance.
On the one hand, it’s understandable. CEOs and business owners are very busy people. Running ads and reviewing resumes are often the last thing they want to do. But there are huge consequences to short-cutting the process and selecting the wrong people. In fact, the U.S. department of Labor estimates that a bad hiring decision can cost a business nearly 30% of that person’s yearly earning potential. So when it comes to hiring, there is a universal truth: Hire wisely now or pay later.
How to avoid making bad hiring decisions
Here are some helpful guidelines to getting the right people on the payroll:
Begin with a clear job description. You can’t hire effectively if you haven’t thoroughly outlined the responsibilities and required competencies of the job, and are able to assess candidates in these areas. You must be extremely clear on the skills, abilities and competencies you require. Interviews must be based upon these criteria, so you know what to ask the candidate.
Pre-screen applicants over the phone. The hiring process is made much more efficient by eliminating weak candidates in a short pre-screening interview. The purpose here is not to identify great candidates but to eliminate those who should not proceed to the next step in the hiring process.
Conduct candidate assessments. A number of effective, inexpensive, web-based pre-hiring assessments can provide you with highly predictive data on character, work ethic and job fit. Make sure the assessment results are received and reviewed before the next step in the process.
Interview comprehensively. Once you have eliminated weak candidates, conduct extremely thorough interviews with viable candidates. A critical rule underlying this interview is that the best predictor of future job performance is past job performance. Thus, ask in-depth questions about past work-related accomplishments and failures. Ask how the candidate’s prior managers rated their performance, strengths and weaknesses. Probe into past performance to help you develop a picture of likely future performance.
Another useful tool is called behavioral interviewing. This is where, in a polite but focused way, you put the candidate on the spot with a series of specific “what-if” questions. Ask, for example, how the candidate would handle a disgruntled employee. Don’t settle for generalized answers; instead, drill down into the scenario, getting the candidate to flesh out exactly what he or she would do in a difficult situation. The right candidate will be ready with the right answers.
Candidate-arranged reference calls: You’ve gained the candidate’s perspective on past performance, but now you go to the source – references calls to prior managers. This step is essential! Knowing that some past employers (particularly in the HR departments) will be reluctant to respond to your inquiry, a good approach is asking the candidate to pre-arrange the call. This increases the likelihood that the candidate’s former supervisor will take your call and answer your questions forthrightly. (Of course, if a candidate hesitates to offer references or to arrange the call, that’s a red flag right away.)
In today’s challenging talent market, the wrong hire will degrade performance in your company, with potentially devastating results. By following the suggested guidelines, you can improve the odds that you add only A-Players to your team and avoid the staggering cost of human resource mistakes.
Learning to effectively hire the right people is among a business leader’s biggest challenges. See how being a Catapult Groups member has helped Tony Barajas, President of Las Vegas General Contracting Firm Barajas & Associates Inc, markedly improve his decision-making process.