Competing with hiring analytics
Embracing analytics into the recruitment process is not just valuable for large companies. With 1 in 10 recruits being regarded as poor hiring decisions, the implications of a bad hire are proving to be increasingly costly for businesses of any size. In any company, the recruiting, interviewing, on-boarding, training and the retention of top talent is a crucial aspect of that company. In comparison, 91% of HR directors find it challenging to find skilled, attractive talent. Wrong hiring decisions, no matter how small, have proven to have a devastating impact on a company’s bottom line. Lost productivity, training costs, administrative expenses, decreased morale and the disruption of team dynamics are all profit killers that can be produced by one bad hiring decision.
How do you proactively take steps toward making the right hiring decision? First, you have to take a step back from interviewing and begin embracing hiring analytics into the hiring decision. Combining calculated indicators such as a Flight Risk Score, helps organizations to analytically assess candidates. Companies can then customize their hiring analytics around specific jobs within the company.
You must use metrics you can take action on. If you can’t, don’t use it! A ‘flight risk score’ is used to predict when an employee will leave a company using various indicators made available through hiring analytics. For employees who have already left an organization, a flight risk score is too late!Actionable analytics must be integrated into your recruiting process from the very beginning in order to reduce the amount of bad hires occurring within you organization. Human connection is still very important to the entire hiring process, but by applying data and analytics, your opinions are either confirmed or eliminated, making your decision that much easier. Using data to affect hiring decisions is more accurate in matching skills with job requirements. Human notions about chemistry and culture have led many companies towards bad hires in the past and with talent analytics, data will guide you towards a much easier and accurate decision to help you find the RIGHT hire.
Selecting new employees based on personal similarities is not a direct route to a bad hire, rather, talent analytics can help you select different skills that will work well together. For example, when building a successful creative team, it is important to include diversity especially when tasks include complex decisions and creativity. Too much similarity in teams can cause teams to be overconfident, which can lead to poor decisions. In order to pinpoint the skills you desire within a team, you should first figure out how to weigh these different qualities and then configure how they would work best together.
Once finding your actionable analytics, you have to actually use the data. This means evolving the recruiting process to get rid of years of ‘experience’ and ‘belief systems’ in order to put the science of data to work. Talent analytics can answer many hiring questions like if your business is getting qualified applicants, where they’re coming from, and if your expectations go beyond that. Through the use of data you can improve the efficiency of your recruiting process and more accurately determine good from bad hires.
Infamous example: Zappos lost $100 million by hiring the wrong people.