How do I know that the costs of testing will be offset by the benefits?

01/05/14

By some estimates the cost of a bad hire is typically as much as two to three times the first year’s salary.  You should want to know as much as possible about your candidates to avoid the lackluster quality of work, poor interpersonal skills, bad attitude, attendance issues, complaints from customers, and/or inability to meet deadlines characterized by poor hires.  A systematic method for screening applicants, a structured interview process, and appropriate selection instruments will add value to your selection process and help you to avoid those costly bad hires.

 

A recent study conducted by Career Builders indicates that more than two thirds of companies have reported that their effectiveness and their bottom line were negatively affected by a bad hire.  The US Department of Labor estimates that bad hire costs an average 30% of first year salary.  HRMorning.com puts the number between $25,000 and $300,000 depending on the level of the position and the responsibilities the individual is expected to assume.  While there is no question that a single bad hire can be costly, the magnitude of those costs can surprise even the most seasoned professional.

 

Consider the contributors to the overall cost of a bad hire.

• HR costs to get rid of the bad hire and bring a replacement on board.
• Lost productivity while the poor employee is in place, while the position sits empty, and while the replacement is being trained.
• Negative effects on employee morale or workflow in a team environment.
• Potential customer problems.
• Loss of business opportunities/sales.
• Cost of recruiting and training another worker.

 

Shouldn’t you want to know as much as possible about your candidates to avoid the lackluster quality of work, poor interpersonal skills, bad attitude, attendance issues, complaints from customers, and/or inability to meet deadlines characterized by poor hires.  A systematic method for screening applicants, a structured interview process, and appropriate selection instruments will add value to your selection process and help you to avoid those costly bad hires.

 

For more – http://www.hrmorning.com/the-cost-of-a-bad-hire-infographic/