Hiring the Right Person: Interviews and references aren’t enough

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There is no question in Jim Plotkin’s mind that hiring is the most important job for a supervisor. “How well you hire tells you how well your company will do,” says Plotkin, president of the Plotkin Group, a Carlsbad, Calif., consulting firm that administers employee assessment tests for a wide range of companies. “Yet, when it comes to hiring, most people are locked into the interview and reference mode. That’s not enough,” Plotkin says.

A survey released in late September shows that 46 percent of new hires fail within 18 months of joining a company. Leadership IQ, a Washington, D.C., training and leadership development company that surveyed 5,200 hiring managers over a three-year period, said only 11 percent of those workers lose their job because they don’t have the proper skills. Instead, they lose their jobs because they aren’t a good fit with the company. The survey found that 26 percent failed because they couldn’t accept feedback (coachability), 23 percent failed because they couldn’t manage their emotions, 17 percent failed because they lacked motivation and 15 percent failed because they had the wrong temperament for the job.

Mark Murphy, chairman and chief executive of Leadership IQ, labels the failure rate “distressing.” “What we have are managers hiring the wrong people,” he says. “We are far too hands-off when it comes to training managers to hire.”

Plotkin contends that the hiring process is more scientific than people think. Giving employee assessment tests is an important part of the hiring equation and tends to help supervisors make better decisions. “You find a lot of people who will only talk about the technical skills needed during a job interview,” Plotkin says. That’s because it’s easy, familiar territory. Yet, assessing personalities and cognitive abilities is just as important as finding the right skill set. “We’re not all smart, but it doesn’t mean we all have to be smart to do good jobs in a company,” Plotkin says. “But you have to figure out how to match the right people with the right jobs.”

That’s been taken to heart at Roel Construction in San Diego, where hiring is given a priority. “It’s extremely important to our company, and we want to make sure we do hire right,” says Amy Hoxsey, Roel’s human resources manager. She says the company has a strongly defined corporate culture and wants to make sure that individuals share its values and mission. “We want to get the right person in the right job with the right boss,” Hoxsey says. “If people perform better working independently than with a team or a group, why would we put them in a job where they [have] to work with a team? We think putting people in the right jobs is one of the most important things we can do as employers.”

Roel, which has about 375 employees in San Diego, Orange County and Las Vegas, has been using employee assessments for several years and believes in them. “It’s a tool we use and a tool we value,” Hoxsey says. “We don’t base our entire hiring decision on an assessment, but it is one more tool we have in the hiring process.”

The financial impact of a bad hire can last long after that worker has moved on, Murphy says. “You have turnover costs, and I’ve seen estimates that put the cost of replacing a worker at 18 months of an individual’s salary,” he says. “But beyond that, a worker who is not performing well can cost you lost revenue. The root cause of lost business is because your employees are not doing a good job, not because of your product or service. That’s something we need to think about when we shape our hiring policies.”