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HR Best Practices:
Reduce Hiring Guesswork
Reduce Hiring Guesswork
Excerpted from Best Softwares White Paper, "Winning Strategies for
Recruiting and Retaining Quality Employees"
To download a copy of the White Paper, click here.
To download the PDF, you need Acrobat Reader. If you need Acrobat Reader,
The estimated cost of a bad hire ranges from two to three times that
persons salary, according to Bill Trau, executive director of the
IT practice at Christian & Timbers, a search firm headquartered in
Cleveland, Ohio. "To replace a mid-level manager, there are costs
associated with the down time that the job goes unfilled, hiring
time, training time, and the time it takes to get the new person up
to speed," says Trau. "An unfilled position may also adversely impact
customer service and hurt business relationships."
More in-depth candidate screening
In a 1998 survey by
Robert Half International, a staffing services firm specializing in
finance, accounting and information technology, 1,400 chief financial
officers (CFOs) were asked: "How has your firms hiring process for
accounting and finance professionals changed compared to five years ago?"
Much more in-depth
Somewhat more in-depth
Somewhat less in-depth
Much less in-depth
Dont know/no answer
More than half of all the respondents, 54%, felt that their hiring
practices were more in-depth in 1998 than they were just five years earlier.
Consequently, about 70 percent of American companies have altered
their hiring and selection process over the last 10 years to stem
the tide of endless bulk recruitment. Whats needed is a comprehensive
system of hiring that encompasses these guidelines:
Look first at in-house talent. Companies trying to hire in a
record-low unemployment environment often overlook qualified people
within their organization. Hiring from within also sends a message
to employees that they too can be promoted.
State Farm Mutual Automobile Insurance Co., headquartered in
Bloomington, Ill., boasts that the average insurance agent has been
with the company for 15 years. The company has a strong promote-from-within
policy. The only source the company uses for new State Farm agents
is from the pool of State Farm employees who have been with the
company for at least three years. Employees that apply and are
accepted for agent positions go through a one-year training program
before they become agents in the field. By then, they have a good
understanding of the corporate culture.
Develop a more structured employee referral program. At the
18,000-employee TRW Systems and Information Group headquartered in
Reston, Va., a business unit of TRW, the employee referral program
is the single largest recruiting tool. It accounts for 35% to 40%
of all new hires, according to Bob Waters, the companys vice
president of human resources.
"Employees dont refer people they dont want to work with, so the
referral program serves as a pre-screening process for us," says
Waters. "But to make it work, you need a financial incentive. When
an employee refers someone we hire, they receive a bonus from $500
to $5,000 depending on the persons position and value. The referring
employees name also goes into a raffle for a chance to win additional
cash prizes ranging from $2,500 to $20,000."
Focus on the culture fit. Evaluating a
candidate solely on education and experience is myopic. Find
out what kind of organization theyre coming from. "A lot of
companies miss the cultural side of the applicant so the fit becomes
wrong," says Chris Laubitz, partner with The Caldwell Partners,
a search firm based in Toronto, Ont. "If youre a formal
bureaucratic organization and the candidate comes from a
free-wheeling, loosely structured environment, that person
may have trouble adjusting."
Read resumes in teams. Youll find that
different people will focus on different aspects of a resume,
whether its a gap in employment history or the fact that the
candidate can speak more than one language. Its a good way
of getting multiple perspectives on the same story, and it
also enables you to get through more resumes quickly.
Avoid decisions based on gut-feeling. Most
people hire out of desperation. The interviewer wants to eliminate
the "pain" theyre feeling about a business need not being
satisfied. So they hire because they like the persons
attitude in the interview.
"Interview behavior does not equal job performance," says
Barry Shamis, principal of Selecting Winners, Inc., a recruitment
and retention consulting firm in Mercer Island, Wash. "Believing
how a person acts in an interview can lull you into thinking
thats how they will act on the job. That kind of thinking can
force you into a higher percentage of mistakes. The best predictor
of how they will do when they come to work for you is to find out
how theyve done in past situations that most closely resemble
Check references. Call a reference during lunch when youre
likely to reach their voice mail. Say "Sam [or Sally] Smith is a
candidate for a position in our company. Your name has been given
as a reference. Please call me back if you believe the candidate
is outstanding." If nobody calls back, youve learned something.
Granted, accomplishing all those tasks can be exhausting.
Fortunately, technology offers ways to reduce the amount of
work required to recruit successfully. Todays human resources
(HR) software packages offer enhanced capabilities such as:
1. Applicant tracking and resume-management modules
2. Online libraries of e-mail resumes
3. Self-service applications that allow candidates to learn more
about your company
4. Tracking of recruiting expenses
5. Faster, more updated information on recruiting trends in your industry
Once a resume comes into the HR department, HR software applications
can store it for future reference. Later, if a manager is looking
for a specific set of skills, such as a tax expert with seven
years experience who speaks fluent Spanish and English, the
software can search for candidates who meet that managers criteria.