Behind the scenes, the wrong candidate can undermine the strength of your company

If you ever calculate the cost of hiring the wrong candidate for a job, and many companies never bother to do so, you will find that it costs you much more than in financial terms. In these times can you really afford to waste your resources like this? We take a closer look into what it will cost you to take a lackadaisical approach to hiring.

Firstly, we will get the financial cost out of the way. It is estimated that if someone leaves before their first work anniversary, they actually cost you 3.5 times their salary, which is a surprising monetary amount, to say the least. The cost of training and onboarding are factored into this figure and it is clear that companies can really underestimate the financial toll the incorrect hire can take on the business. The Department of Labour estimated that it could equal a third of a fledgling business’s annual revenue. These failures definitely cost UK businesses untold billions per year.

An investment in a worker is an investment in a business. Whilst it is not the same as buying a piece of equipment and demanding a refund if it broke down, it is certainly something you would learn a lesson from, yet companies seem to disregard this failure as unavoidable.

The company will also take a hit in terms of productivity if an employee is either not well suited to the role or leaves after having been trained up. A failure can be distracting to a team, can cause personnel resources to be rerouted and can pull managers away from important problems which need solving, which has a knock-on effect within the whole company.

Having an employee leave so soon after training has been given causes another headache. Their replacement must be found, which costs more time and more money, then onboarded and trained up, which draws more human resources as well as money away from the business. This draining process continues until the correct fit is found.

The failed hire could have a negative impact on employee morale too. If the team is working to a target with a bonus as an incentive attached, and the wasted time spent on that employee who didn’t last the year can cause resentment. If they have had to fill in and do overtime, in order to get things back on track, with little thanks or reward, it can lead to dissatisfaction and an exodus if the problems are not addressed, especially if the bad hire has caused their own work to suffer. Have you noticed a high staff turn-over?

If multiple candidates are hired and leave quickly, other workers may start to doubt the abilities of their management. Confidence is important to build a healthy company culture but that can be eroded if you are not careful.

Summing up, it is so important to do all you can to hire the best people for the roles. Hopefully, this blogpost has been food for thought when it comes to your hiring practices. Think about how many man hours, how many pounds or euros or dollars, how much worry and stress, how much energy you couldn’t spare, that these incorrect hires have cost you and your company. Who is in charge of your hiring? Do they have the experience or is it okay to admit that external recruiters, for a fraction of the cost, may be needed to guarantee that the losses are halted, and confidence is restored?

Curious about how Zenshin Talent can help your organisation? Contact us today for a no-strings conversation about your needs and our experience.