6 Costly Hiring Mistakes to Avoid

People are among the most valuable assets of any business. Put the right person in the right position, and they can help your organization thrive. Conversely, hiring the wrong people harms your organization in several ways—loss of productivity, impacts on the existing team, customer confidence, and money. In fact, according to the U.S. Department of Labor, the cost of a wrong hiring decision can add up to as much as 30 percent of an employee's annual salary. For a $60,000 position, that's $18,000 in lost expenses.

Hiring is a challenging task. We recommend avoiding these six common mistakes before starting your next talent search. 

Mistake #1: Not Establishing a Structured Hiring Process

A structured process should include the following:

• Developing a thorough and accurate job description
• Articulating all the prerequisites, skills, and assets
• Detailing key deliverables, expectations, and success measures
• Accounting for certain deal-breakers like physical requirements, travel requirements, and other elements
• Building a framework and reasonable timetable for interviewing, reference checking, offers, and negotiation

Your hiring manager (or team, if it's a collaborative effort) should first drill down to understand what the organization looks like today and what it will look like two, three, or even five years from now. Then, ensure that your hiring process not only accounts for current needs but those of the organization as it grows. 

Mistake #2: Failing to Check References

A candidate’s resume may look fabulous and point to almost certain success in your organization based on the work experience and skills they list. However, it's up to hiring managers to verify each person is who they say they are and has done what they claim to have accomplished. We have heard many stories about candidates being dishonest and the resulting truth coming out well after the hire was made. The adage, "trust but verify," is sage advice in the hiring realm.

The reference check phase of your interview process presents an excellent opportunity to gather insights from a candidate's previous supervisor. This allows you to gain valuable information about the candidate's potential strengths and skills that may not have been initially anticipated for their new role.

Mistake #3: Over-Interviewing the Candidate

When too many individuals are involved in the interview process, it can lead to conflicting opinions and a lack of consensus. Additionally, it places a significant burden on the candidate, who may have to repeat their answers multiple times and endure lengthy interview sessions.

Instead, it is more effective to have a select group of key decision-makers involved in the interview process. This allows for a focused evaluation, ensures streamlined communication, and reduces the risk of overwhelming the candidate. By maintaining a balanced and efficient interview process, you can make more accurate assessments and select the right candidate for the position without unnecessarily prolonging the hiring process.

Mistake #4: Talking Instead of Listening

Interviews are your opportunity to get to know the candidate. Actively listening allows you to gain valuable insight into their qualifications, skills, and fit for the role and company culture. By giving the candidate room to talk, you can uncover essential details about their experiences, motivations, and problem-solving approach. Truly understanding the candidate's perspectives and paying attention to their responses enables you to make a more informed decision and identify the best person for the position. 

Mistake #5: Over-Analyzing the Resume

Through our many years of partnering with clients and candidates, we have found cultural fit outweighs technical fit for organizations of all sizes again and again. Even if a resume doesn't include all the skills or criteria you seek in a particular candidate, that individual may still be the best potential match.

For example, suppose one of your hiring criteria is that the ideal candidate worked at their last position for at least five years, but a potential candidate left their previous job after only two years. In that case, there may be a good reason why they left, which doesn't diminish their potential suitability for the role. It's up to the hiring manager or team to use the resume as a resource and also look holistically at a candidate to make decisions.

Mistake #6: Limiting Your Talent Pool

Resist the urge to only post job positions in the same outlets you always have. Look beyond your website, association websites, and popular online job sites. Consider a resume-feeding system. Post your jobs in trade publications within the field of that particular position (e.g., if you seek an internal auditor, post in a widely read accounting and auditing publication). You can even contact local community associations if specific positions could attract qualified candidates from these groups.

In addition to a lack of quality advertising, one of the most common hiring mistakes we see is organizations limiting themselves to a tiny percentage of individuals who actively seek employment. Here in Nebraska, for example, unemployment is currently under two percent. As a result, highly qualified individuals who actively seek employment are few and far between.

Try proactively reaching out to passive candidates, even if they don't seem ready for a new job at the moment. Researchers estimate that at least half of the employed population is receptive to hearing about outside opportunities.

Avoid costly hiring mistakes by leveraging the resources of a hiring firm like Lutz Talent. Our team is constantly interacting and networking with individuals in various industries. We can provide invaluable access to the highly skilled talent that companies seek. If you have search and staffing questions, please contact us!