The cost of mis-hire is greater than you might think. It has been estimated to be at least 3.5 times the cost of the employees’ salary (including the cost of recruitment, decrease in performance and lost opportunity).
This is a significant factor to consider when making decisions about your approach to recruitment, especially for resource-stretched organisations.
When needing to recruit, you’re probably going to consider either conducting the process yourself (in-house),engaging an external recruitment specialist or working in partnership with a service provider offering pro-bono services. Regardless of the choice you make, it is critical to ensure that all key elements are in place prior to commencing the process including; an agreed mandate on what is actually needed, key milestone setting, the review of advertising options and networks to explore, interview guide preparation and the selection of a committee to oversee the process.
Ensure that whoever is driving your recruitment process has the time to commit to it, an in-depth knowledge of your organisation and its needs, access to a diverse and talented pool of relevant candidates, and finally, an unwavering commitment to a clear and consistent DIY recruitment (no internal recruitment function)
Conducting the process in-house typically means distribution of an ad to your organisation’s network, and posting it to a few job boards. Then you sift through applications, in a bid to shortlist and interview. Important to note here, is that when you advertise online, you are only reaching 15%  of potential candidates;
those who are actively looking for opportunities. Passive candidates not only make up a much larger proportion of the population, but they are on average higher quality candidates. These passive candidates are not actively looking for work and therefore, not trawling SEEK and traditional job boards. Good head-hunters and recruiters nurture diverse and relevant talent pools of passive candidates and can often grant you access to them, deepening your talent pool of prospective candidates. So unless your network is broad, you may not be casting your net wide enough.
On average, it will take you between 75 and 100 hours to conduct a search. There could be hundreds of applications, and in order to achieve the best result, you will need to pick up the phone to some applicants you are unsure about BEFORE you even get to the first interview stage. You will most likely need to conduct several rounds of interviews. Furthermore, you will need to ensure that you communicate updates to candidates at each stage of the process, in a timely and respectful manner, in order to protect your organisation’s reputation.
Be clear about the true cost of leading this process yourself, and consider the opportunity cost associated with YOU taking on the task as well as where your skills lie i.e. where you can best add value and what is really core to your organisation.
One other aspect you might want to contemplate is the repercussion of an unsuccessful in-house search, followed by a search conducted by a specialist recruiter. Not only does this scenario end up more expensive,but the market may also interpret multiple recruitment attempts as an indication of potential issues with either the role or the organisation; presenting a real reputational risk.
Bringing in the specialists
There are a number of distinct advantages to engaging external assistance with recruitment. The most obvious of these is, that it is their core expertise and what they do on a daily basis. If you compare this to the sale of your family home, of course you could undertake the task yourself and sell your most significant asset, but do you really have the skills and knowledge to deliver the best result? In most cases, real estate agents will help to deliver the maximum return on the sale of your home with their specialised marketing tools, buyer database, and market and sales knowledge. In much the same way, effective recruitment specialists nurture communities of candidates across functions and are able to readily tap into these talent pools to present you with relevant and capable candidates, achieving economies of scale.
Secondly, a third party perspective can see things that may not be readily apparent to those who are immediately involved. A good recruiter will liaise with a range of stakeholders to see different perspectives of what is needed, because diversity of input is a critical success factor that is often overlooked when CEOs take charge of recruitment. This will also help the team feel included in the process.
Thirdly, having a buffer to handle the disappointed candidates can also be very helpful because this feedback loop is often time intensive and emotionally draining. This buffer can also be very helpful when diplomatically assessing and managing internal and network-referred candidates alongside external candidates.
For free or not ?
If you are lucky enough to secure pro-bono recruitment services, ensure that you have a senior consultant working with you who has a deep understanding of the sector and a wide and relevant talent pool you will be able to dive in to. Ensure they have a real appreciation of your organisation, your challenges and opportunities to enable them to present an appropriate shortlist.
Too often, we witness for-purpose organisations become hostage to the imbalance that sometimes arises because they are not paying for their recruitment support. It manifests itself in many different ways where organisations find themselves hesitant to ask questions on the credentials and experience of the consultant who will lead the process, and reluctant to ask for updates and push on agreed timelines because they have not purchased the service.
Discuss this dynamic upfront and manage the expectations of all key parties involved. Just because money has not been exchanged, you should not settle for an inferior service where you do not derive the value you require.
Regardless of the option you choose, remember the high cost of getting it wrong. Consider the process, the time you have to commit to the process, in addition to the monetary investment. Of paramount importance is the OUTCOME. Not just having a person in the role, but rather the best possible person.
Investment in a robust recruitment process gives you the greatest chance of choosing the right individual, and deriving the highest return from your biggest asset, your people.