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Four Strategies to Measure Quality of Hire Effectively

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If you’re concerned you’re not measuring quality of hire effectively, you’re not alone. Although quality of hire was the most important metric to recruiters in a recent study conducted by LinkedIn, only 33 percent feel they do a good job of measuring it.

Quality of hire is an elusive metric. We want to know if the hiring process is actually selecting the right talent, but there are a lot of subjective factors involved. What’s more, there’s no magic recipe or industry standard with which to measure—that varies from organization to organization depending on what is most important to them.

Although there’s no one-size-fits-all approach, there are steps you can take to improve the way you measure quality of hire. Use these strategies to tailor the metric to your organization and measure quality of hire with confidence:

  1. Set performance objectives

Measuring quality of hire begins at the start of the hiring process. That’s right — you need to be thinking about the metric as you draft the job description. Develop the main performance objectives for the job to describe the position. These performance objectives are a critical part of measuring.

Your performance objectives need to be specific, so there is a clear and concrete way to measure them. A typical job description may list communication skills as a key requirement for the position. But how will those communication skills be used in the job and to what end? Will the employee need to write certain content? Deliver presentations? Communicate regularly with clients?

Layout the specific performance objectives of the job, so you know what to look for in a candidate and how to measure their success in the position.

  1. Predict quality of hire

Using the performance objectives, estimate before their first day how well you expect your new hire to perform based on their past performance and qualifications. How will their experience and current skills help them succeed?

After the new hire starts in their position, measure their actual success in achieving the performance objectives. Did they meet your expectations? Exceed them? If new hire performance falls below your expectations, it may signal problems with your hiring process.

Depending on where the new hire is faltering, low performance could mean their skills didn’t match the performance objectives closely enough, the hiring process failed to account for working styles and company culture, or the process needs a more effective screening and evaluation process.

  1. Talk to employees

Quality of hire doesn’t solely rely on quality of work — cultural fit and employee satisfaction are just as important.

If you’re just looking at performance, you may think top-performing new hires are happy and engaged, and that’s not always the case. In a 2013 report conducted by Leadership IQ, low performers at the organization studied were much more likely to say they were motivated to give 100 percent at work than high-performing employees.

This means your high-performing new employees aren’t necessarily engaged, and when employees aren’t engaged, it’s only a matter of time before they look for opportunities they find more exciting.

Ask employees to rate their engagement and satisfaction with the position to understand if they are truly a great fit. New hire feedback can point you to weaknesses in the hiring process and help determine how to better select candidates who fit the culture and are passionate about the work the organization does.

  1. Look at the big picture

When looking at quality of hire, it’s easy to get caught up in the little details. The cost of hire, amount of hires, and time to fill look at the recruiting process but don’t effectively measure the quality of hire. These metrics are more focused on speed and quantity, not quality.

Instead, look at quality of hire in terms of meeting larger company goals. How are your new hires impacting the overall success of the company? Are they improving processes, increasing productivity, fixing inefficiencies?

This approach requires you to look at the big picture goals of the organization, and the overall quality of hires, not just individual performance. After analyzing each new employee, view them as a whole to find the overall success of your hiring process.

To get a real sense of the effectiveness of your hiring process, you need to rethink the way you measure quality of hire. Focus on specific objectives to better evaluate the quality of candidates you bring in and to improve your hiring process.

What is most important to your organization when measuring quality of hire? Share in the comments below!

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Fix Tech Hiring: Make It Data-Driven and People-Led

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Tech hiring is broken, and the data from research is overwhelming. Below are a few highlights:

  1. Bad hires are extremely expensive. A study by the Society of Human Resource Management (SHRM) estimates the cost of a bad hire can be as high as 5x the salary. Zappos CEO Tony Hsieh has estimated bad hires cost his organization over $100M.
  2. Bad hires happen far too frequently. According to a study by the Brandon Hall Group, 95% of companies admit to recruiting the wrong people each year.
  3. Great hires are game changers. According to research by Linda Pittenger from the Embry-Riddle Aeronautical University, high performing technology personnel are 10x more effective than average performers.

With studies like these, it is no wonder that many solutions are being developed to ease the pain. So why does the problem still exist?

The answer is that innovative organizations need to be both data-driven and people-led.

Companies that are just data-driven will leave common sense and simple solutions behind. They will over-engineer every answer and forget the people-side. While those that are just people-led will follow their charismatic leader without the support of, you know, facts. Zappos is an interesting example of being both data-driven and people-led as they recognized the problem through measuring data and understood the people side with their solution of offering $2000 to employees to leave after the first week.

The problem of bad hires, however, can be greatly reduced far earlier than after the first week of training. According to Bersin by Deloitte, organizations with highly mature talent acquisition functions spend 2x more than those organizations with low maturity functions but have a “40 percent lower new-hire turnover and are able to fill vacancies 20 percent faster.”

And, we know where in the hiring process to look. Again from the Brandon Hall study, “69 percent of companies in our research identified a broken interview process as having the greatest impact on the quality of a hire.”

The problem specifically in tech hiring is that assessment and interviewing are particularly difficult. The pace of change in technology is breath-taking with the number of platforms, and technical skills make it impossible to keep up. Also, tech hires are in such demand that hiring managers feel the pressure to hire quickly.

Currently, most companies rely on unstructured interviews by their internal team possibly combined with a behavioral interview from HR and an online assessment of technical skills if they exist. This process is lengthy and disjointed.

One solution would have a resource that is both a subject matter expert and an interviewing expert. This expert can put the candidate at ease, go through a consistent, structured process to evaluate candidates evenly, and be able to ask the probing follow-up questions to truly understand the candidate’s capabilities.

You could invest in building this process internally by taking your best technology assets offline to focus on this work, but the best solution would be to leverage that expertise that already exists. The problem is that these skills have been previously inaccessible as they are dedicated to their particular technology craft at other great companies.

Technology has been used with great success to change many business models by connecting and utilizing previously under-utilized assets. AirBnB and Uber are two excellent examples. Expert Interview leverages these same principles to connect those rare technology experts that also know how to assess candidates and build teams. Stop over-engineering. Be data-driven and people-led.

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Prevent Bad Hires with Your Hiring Process

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There’s nothing worse than investing time and energy into hiring someone and finding out you’ve made a mistake. Recruiters fear that after weeks of pouring through resumes and talking to candidates, they’ll select the wrong one. A bad hire can be a drain on the organization from multiple angles. It costs money to hire and train someone who ultimately won’t work out. And it can drag down the morale when someone new is introduced and then exited. It can cause a sense of fear and panic to reverberate throughout the organization. But what if you can prevent bad hires upfront? What if you can pick apart your hiring process to prevent bad hires? Let’s examine the steps within the hiring process that can be improved to prevent a bad hire.

 

Enhance Your Hiring Process to Prevent Bad Hires

Every company’s hiring process is different.  But some companies have their hiring process down to a science.  They run like well oiled machines and seem to attract the best candidates.  What are they doing differently in order to attract better candidates and prevent bad hires?  According to Talent Board’s 2014 Candidate Experience Report , top companies are creating better candidate experiences with transparency and support.  These top companies are operating in tune with what candidates desire.

We’re in an age where information is plentiful.  We are literally bombarded with messaging at all angles.  To find out anything, we can hop on our smart phones and surf the information super highway for answers.  But some companies are still stuck in the past.  They don’t offer information up front to draw top candidates.  This is where you can enhance your hiring process.  Your organization can move beyond simply offering a career page to branding it to attract top talent.  This is where the company can really shine: you can offer insights into teams, company culture, and branded videos to appeal to the top candidates.  Great companies often take it a step further and offer immersive interviews via video interview software.  This allows candidates to get the full experience of what joining this company would be like.  Often, these kind of information rich hiring processes are able to prevent bad hires.

Review Expectations Up Front

Sometimes, a bad hire is not the result of the hiring process, but really unrealistic expectations.  We’ve all heard stories where candidates were hired on for a role like marketing, but the hiring manager’s uncommunicated expectation was that this hire would produce their yearly salary in sales in their first month.  These kinds of expectations should be examined up front by both the hiring manager and the recruiting or HR department.  Sometimes, if expectations are not realistic or in alignment with the position, it can produce a bad fit.  In these cases, the new employee could be confused about how they fit into your organization.  A careful review of these expectations can help prevent hiring someone that will ultimately be classified as a bad hire.

Similarly, job descriptions should be carefully reviewed prior to posting.  Does an hourly cashier position truly require a bachelor’s degree?  Or will this kind of requirement produce a smaller talent pool that is more likely to leave when another opportunity comes along?  These kinds of questions are crucial to the hiring process.  By addressing these concerns prior to posting, your team can work together to prevent bad hires.

Realign and Recommit to Quality Hires

Once a recruiting strategy is in place, it’s up to the recruiting team to pursue quality candidates.  By auditing these critical steps in the process, an organization can work towards preventing a bad hire.  But it’s not a fool proof system.  Sometimes, recruiters have an off day.  And sometimes, candidates lie convincingly enough to get hired.  With these steps in place, these kinds of mistakes should be minimized and produce quality hires over time.

People Quality Makes For Picture Perfect Business

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“All I know is that sometimes the truth is contrary — everything in life you thought you knew.” —Neil Peart (Musician and Writer)

Without doing the math and coloring them in, you can still tell what most of them are. But that’s no fun when you’re six, just learning addition and loving to color pictures like my oldest daughter does. Adding the numbers together in each piece of the picture “puzzle” and then following the corresponding picture color code to color each piece in is the thrill of discovering its full context.

If the data is right (the math is correct) and the color code followed accordingly (regardless if colored a bit outside the lines), then these two things coming together tell a vibrant story in and of itself. And no matter how many times you complete the color by number pictures, the vibrant stories remain valid and reliable.

Quality may always vary somewhat with all of the above, but it’ll definitely go beyond the artistic going with one’s gut.

Like in recruiting. In a global talent acquisition market where most recruiters and even hiring managers spend only seconds reviewing each resume (we’ve all done it), no matter how good we think we are, it’s no wonder the “gut feel in hiring” is usually less accurate than a coin flip.

In fact, an article in the Harvard Business Review last year highlighted that, “humans are very good at specifying what’s needed for a position and eliciting information from candidates—but they’re very bad at weighing the results.” The authors found that simple computer algorithms outperform human decisions by at least 25 percent, “regardless of whether the job is on the front line, in middle management, or in the C-suite.”

While there is obviously still value in having recruiters and hiring managers who possess good people instincts, it has become even more essential that they have reliable data on which to base their sourcing, screening and hiring decisions.

We’re just not as good as we think we are when it comes to computing quality.

Reliable data and that single source of data truth – that’s where we need to get to first in order to address the quality conundrum. That’s not easy when today’s human resource and talent acquisition professionals rely on a variety of systems, such as HRIS, ATS, ERP, CRM and more, to manage their most important asset – their people.

These systems supply companies with data on everything employee-related, from general demographic information like date of birth to candidate sourcing channels and from compensation and benefits history to employee performance ratings. And, the volume of HR data generated by companies is increasing daily – in large organizations, there can be upwards of 10 different HR applications generating data.  In multinational corporations, there are dozens of different disparate HR systems, covering various geographies and functions, yet disconnected from the “mothership” core.

Obviously the solution is to integrate and analyze the data that is held within a company’s talent acquisition system into the company’s human resource information system (HRIS) and vice versa. This could be done in a integrated core HR and talent management suite solution, or it could be done with a sound data integration and management solution that nicely unifies the pipelines of any and all HR and recruiting point solutions and/or suite combos.

As the workforce continues to become more global, mobile and diverse, ensuring that all these systems enable collaboration and cooperation becomes even more critical. Again, we need that one single source of data truth that will support our HR reporting and talent analytics initiatives, something we talked about at length on the TalentCulture #TChat Show with and Jen Phillips Kirkwood, ADP Analytics and Innovation Ambassador.

By allowing for applicant data to flow unobstructed between all these critical business systems can enhance our ability to:

  • Build deep talent pipelines
  • Obtain a long-term view of our workforce
  • Gather real-time, actionable data
  • Save recruiters and hiring managers time and resources
  • Standardize and synchronize data across all HR systems

No longer are talent acquisition professionals focused primarily on time-to-fill as a competitive advantage – now, it is also about finding ways to increase quality of hire. The unification of all this data enables improvements in recruiting effectiveness throughout the organization, impacting the overall quality of hire and ultimately the performance of the business.

When I got certified as a Talent Acquisition Strategist from HCI last fall, we went over a progressive case study on quality of hire measurement from Avanade, a technology company that helps clients and their customers realize results with Microsoft technologies.

Avanade has created a worldwide interview assessment methodology that measures competencies, behaviors, technology capability and cultural fit, against their current workforce populations. This results in improved new hire performance and helps reduce attrition for the first 12 months of employment.

Their quality of hire analytics require multiple data points that help calculate and inform continuous adjustments to new employee quality. This includes:

  • Average performance rating for new employees in the first 12 months.
  • Employee performance as a percentage of “achieves expectations” of performance in the first year.
  • Annual hiring manager survey focused on overall quality of new employees.
  • Percentage of employee retention during the first 12 months of employment.

Quality of hire is often referred to as “the holy grail” of recruiting and hiring. It’s what all the winners of the Candidate Experience Awards aspire to. In fact, Amelia Merrill, Head of People Strategy (HR) at RMS and four-time CandE winner, recently presented at the first-ever CandE 101 Workshop and shared that “either you’re all in on the candidate experience, or your not. Nobody gets half pregnant.”

Indeed. There’s no better way to be “with quality-of-new-hire child” than by going all in with unified HR systems, key recruiting and hiring data and talent analytics. An excellent way to start determining your quality-of-hire is by tracking the turnover of your new hires during their first year with you. Higher-than-desired levels of turnover within this period often signify poor sourcing, selection or onboarding – or some combination of these activities. It all comes down to how carefully you measure and track new hire sourcing, performance, competencies, turnover/retention, diversity and inclusion, and developmental/leadership potential.

Just do the math: people quality is what makes for picture perfect business.

About the Author: Kevin W. Grossman co-founded and co-hosts the highly popular weekly TalentCulture #TChat Show with Meghan M. Biro. He’s also currently the Product Marketing Director for Total Talent Acquisition products at PeopleFluent.

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The Better Angels Of Perpetual Candidate Experience

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We long for better angels. At least most of us dbo. We long for continuous support and sounding boards, deeper cultural connections to our real-time universe, our heaven (and sometimes unfortunately hell) on earth, and all those we come in contact with, whether in fleeting moments or ongoing endurance sessions of meaning and purpose with family, friends and colleagues, better angels everywhere we go.

Especially when at work, because at least for most of us, it’s not always a pleasure picnic. Plus, we’ve got bills to pay, food to keep on the table, a roof to keep overhead, and hopefully some left over for a vacation or two with the kids.

But for the modern dispersed workforce, the unprecedented levels of stress today in the workplace means that we want more than the money; we want cultural fit with like-minded folk to collaborate, innovate and invigorate our workspaces everywhere we go.

If my better angels aren’t there, then my workplace universe becomes a dark and cold place that no amount of cash can light up with warmth. At least, for most of us.

But cash burns a cold fire backstory for employers especially considering how highly competitive talent acquisition is today – the wrong hire can cost companies upwards of $25,000 – $50,000 on the average. Add to that the fact that job seekers are savvier in their search for the right positions and companies today with a strong employment brand and a level of transparency into their organizations is critical.

According to the Talent Board’s 2013 Candidate Experience Awards report, based on data from nearly 50,000 candidates from over 90 progressive companies, 59.5 percent of candidates have some relationship with employers at the onset of their search, which indicates a clear initial pre-disposition toward the employers and suggesting that positive association is the employer’s to lose.

Delivering a compelling employment brand story and recruiting user experience – especially for candidates – is what progressive organizations are doing today. Talent acquisition leaders are looking for ways that will amplify their recruiting process, ways to share and showcase their better angels.

What’s even more telling is that the results from the 2013 CandE Awards indicate the emerging importance of communicating a company’s culture as a key point of differentiation, as well as decreased emphasis on job benefit details.

Amen.

Job candidates’ interests do center on why they might want to work at the company and why they would stay at that company, if offered a position. And just like the company seeks to assess the fit of those candidates, those same candidates are interested in the culture of that firm, and how the job (as it is presented by the employer) is aligned to the success of that company.

In the 2013 CandE survey, when progressive employers were asked “what marketing content do you make available (or that a job seeker might want to ask about) before they apply?” – the answers included:

  • Values (i.e., ‘Fit’) – 92.2%
  • Answers to ‘Why’ People Want to Work Here – 92.2%
  • Community and Sustainability Initiatives – 90.6%
  • Answers to ‘Why’ People Stay Here – 89.1%
  • Product Information – 88.9%
  • Diversity & Culture – 82.8%

Five out of the top six related to culture and “better angels.” Compare that with when the candidates were asked “what is your experience with the company’s marketing content available before you applied?” in the survey:

  • Values (i.e., Fit) – 48.7%
  • Answers to ‘Why’ People Want to Work Here – 48.6%
  • Product Information – 47.6%
  • Answers to ‘Why’ People Stay Here – 44.7%

Three out of the top four also lined up nicely with cultural fit. It’s important to note that candidates are consumers as well, not only of company culture, but also of what the company does and sells, which is why “product information” was so high on both of the above survey results.

How can we promote these “experiences” in a way that continuously highlights company culture for potential new employees as well as current employees?

Well, with video, of course. Seeing is believing:

  • Seeing. Corporate career sites are rich in media and employment branding content, including video. Video is a powerful medium today and with lower-cost and improved video creation and distribution platforms, and of course our everyday smart phones with cameras we carry around, its pervasiveness is telling. Companies can and should do a better job storytelling through video, enabling their talent acquisition teams to create company overview videos, “day-in-the-life” employee videos, hiring manager “what it’s like to work here” videos and other job related videos, that easily be posted to their career sites as well as leveraged for internal mobility.
  • Is Believing. Amplifying “talent engagement” candidate experiences, and our better angels, through video, enable a culturally collaborative hiring process that’s quite beneficial for candidates, recruiters and hiring managers alike. It creates a cultural bonding opportunity that is talent-centric, not process-centric, fostering consistent employment branding and personalized experiences crystallized and perpetuated into heavenly marketing moments that, if transparent and real, will lead to better business outcomes like faster recruiting, better quality of hire, cultural fit and improved retention.

Amen to the better angels of perpetual candidate experience, meaning and purpose.

(Meghan M. Biro and I are proud CandE Council members and volunteers, and my company PeopleFluent is a proud platinum sponsor. There’s still time to participate in the 2014 Candidate Experience Awards!)

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