9 Reasons Some SMEs Hire the Wrong People

October 2014

According to research from the Harvard Business School, the cost of a poor hire can be up to three to five times that of the employee’s annual compensation – for specialist functions this increases to ten times the annual salary. If hiring the wrong people is so expensive, why is it that so many businesses find it difficult to hire the right people?

Let’s take a look at a few of the common reasons SMEs end up hiring the wrong people.

1. Looking for an identical replacementYou don’t want to hire the same person again because the person who has just left wouldn’t want the job. They can already do it and are ready to grow into a new role. You need some stretch in the role for the prospective candidate to give them an incentive to achieve and become even better than the person who left.

2. References are taken as a “tick box” exercise

In an interview you get an isolated 30-45 minutes of questions and answers with a candidate, while their previous employer has worked with them every day for years. If you only call a referee to get them to confirm a decision you have already made, you are wasting a huge opportunity to get real insight into a potential hire.

3. Not selling your company brand

You may think you are the best company to work for but, without providing a great impression and an engaging interviewer to a candidate, they won’t feel the same. The very best candidates will have their pick of opportunities. If you want to get them, you need to sell your brand.

4. The line manager is not actively involved

Everyone says their people are their most important resource but how many times is the recruitment left to the HR/recruitment department? The line manager will have the best understanding of the team, environment and practical requirements of the job. If they are not involved, you may end up with a bad fit.

5. Job specs that are out of date, too narrow or too vague

It may seem like a chore to write a comprehensive job spec, but if you don’t do it then it should be no surprise if you cannot find the right candidate. The way we work and the requirements of a new role change all the time. If your business has grown – or technology has moved on – since the last time you hired for a role, the job spec has to change. If it doesn’t, the best candidates may think your job is out of date.

6. Rushing the recruitment process

Candidates and employers both want the process to run quickly and smoothly. If you start the process before you are ready, it will drag on too long for the best candidates or you will rush to the wrong decision. As a rule of thumb, don’t start the process until you can say “If I saw the perfect person tomorrow I would hire them immediately.”

7. Basing decisions on first impressions

Don't be misled by first impressions. Just because they work for a competitor and look the part doesn’t mean they will be the perfect employee. Open your mind to interview the candidates that fit your company values and have passion for your company, even if they don’t fit the “dream” profile. Use competency-based behavioural interviewing techniques to identify the real skills that make a great employee.

8. Under-utilising your own people to source candidates The best hires are generally referrals from your network. Your people talk to the best candidates all the time; use these connections to find the very best person for the job.

9. You don’t train people to interviewInterviewing is a skill. It’s not enough to sit down and listen to a candidate talk through their CV. The best interviewers know the right questions to ask, how to structure the questions in the most effective way and how to get the right answers from the interviewee. Training your people to interview will allow you to gain better insight into your candidates and hire the best people.

Written by: Arleen Quigg, Recruitment Manager, Cpl – Growing your team? Talk to Cpl to discuss how to find the best people for the job.