Worldwide, millions of companies are engaged in various activities. They have different names, different incomes, and different professions. The common point that almost all small and large companies around the world share is that they all have employees. These employees, sooner or later, exit the economic cycle of the company, and the management is forced to replace them and hire new personnel. This hiring may also be a result of the development of the desired company’s business. The entry of new employees into a company is a significant challenge that requires experience, expertise, and precision because hiring the wrong person can expose the company to considerable crises and introduce irreparable consequences to the business. It affects how well the company works, the mood of the team, and the culture of the company, the costs, and its reputation in the long term.

Leadership IQ conducted a research study showing that 46% of new employees fail in 18 months, and the success rate of new hiring is only 19%. A CareerBuilder survey lists the reasons for bad hiring as follows: 35% of employees were aware that the candidate doesn’t have the skills, but they thought of them as fast learners. 33% of candidates lied about their qualifications, and 30% were under pressure to fill the position quickly.

So, what are the consequences of a bad hire?

The exact monetary cost of an inaccurate hire differs based on factors such as the type of industry, the employee’s salary, and hiring resources. However, in general, there are consequences that could be caused by a bad hire:

1- It decreases the productivity of the company

Hiring employees who are not suitable for the intended position leads to results that contradict the company’s standards and expectations. On one hand, the performance of the new employee is likely to be very low due to procrastination in performing tasks assigned to them. On the other hand, other employees of the company may be forced to take on the unfinished or incorrectly done tasks of the new employee, causing a significant decline in the current performance of the company.

2- It causes financial loss for the business

According to SHRM, the turnover of an incorrect employee typically incurs costs equivalent to 40% of the employee’s annual salary. These costs arise from factors such as lost productivity, lost hours of training, Recruitment marketing costs, etc. In high-growth industries, losses pose obstacles to the progress of the business, as essential resources are required to expand and innovate the company.

3- It damages the public trust to your brand

When there is a bad hire, especially in higher positions, it affects the reputation of the company. If the employee does not represent the values of the company, it creates a wrong impression on people. In the event that the new role is a customer service position, the incorrect hire leads to confusion and damages customer trust. Furthermore, it convinces hesitant customers to use the services of competitors.

4- It toxifies the company’s environment

When the new hire is not a good fit for their role, tension and strain increase within the team. Staff must work harder and longer to handle the piled-up tasks left by a bad hire, usually without compensation or a change in job title. As a result, their attitude toward their jobs is affected, toxifying the environment and increasing the level of complaints within the company.

5- It reverses all the progress made

Not only can a wrong hire reduce productivity, incur financial costs, and toxify the environment, but it also reverses all the progress made. The hiring team should spend time and effort again to bring in a new hire, establish new agreements, set up systems, and train a new employee.
After finding a new replacement, they need to pick up the project being worked on by the previous employee, and because of the time interval, they probably need to speed up the training which has a price. It also needs more money to hire the new employee in less than the regular time.

6- Missed deadlines and disrupted work process

When a team collaborates on a project, the performance of each individual has an impact on the overall team performance, ultimately influencing the quality of the final result. Introducing an unqualified employee to this group disrupts the flow of the team and leaves projects incomplete. As a result, it affects either the quality of the project, the delivery time, or both.

7- It causes cultural imbalance

Having a new team member with a personality type different from the company culture disrupts the cultural environment. While it is essential to ensure that the new employee possesses the qualifications for the open position, it is necessary to assess whether they align with the company culture to meet the role’s requirements. Evaluating how they will integrate into your company’s culture and work with your colleagues should be a top priority when hiring.

For example, in for-profit businesses, the company’s priority is often on productivity, while in non-profit organizations, a community-minded culture is emphasized. As a result, while a detail-oriented and serious person may be a good fit for businesses, non-profit organizations might require employees who are more collaborative and have a sense of humor to attract donors.

8- Potential Legal Issues

It is not uncommon for a terminated employee to be involved in illegal activities that harm the company, ranging from selling confidential information to damaging business property. Consequently, the company may unexpectedly find itself entangled in an expensive legal battle, and unfortunately, in some cases, no amount of money can fully compensate for the damage incurred.

How to avoid hiring the wrong people

1- Invest in your hiring process:

Assess all the requirements for the role and formulate a well-thought-out hiring plan. Evaluate both the hard and soft skills necessary for the job. Ensure comprehensive job advertising and avoid relying solely on connections. The greater the number of resumes you receive, the higher the probability of finding an outstanding employee.

2- Ask for references:

While references may not conclusively determine if a candidate is a good fit for your company’s environment, they provide valuable insights into the candidate’s history of work.

3- Accept volunteers:

If you have a junior opportunity available, considering a volunteering position could be a great idea. It allows you to personally observe the candidate’s working style and assess whether it aligns well with the requirements of the job posting.

4- Assess the hard skills:

In technical positions, nothing holds more significance than strong hard skills. Dedicate time to create an assessment for candidates and evaluate their knowledge during the second round of the interview.

5- Take a personality test:

It is vital that the employee’s personality aligns with the culture of the environment and the role. Energetic individuals could be a great fit for a sales position that involves working in public places, while thoughtful candidates may thrive in roles requiring more independent work.

6- Get help from professionals:

One of the most effective solutions to avoid bad hiring and its consequences is seeking assistance from professionals. At our company, we have contributed to the success of public and private businesses of all sizes across various industries. Our highly qualified recruiters have built their careers by providing exceptional service to both clients and candidates. Leveraging our expertise ensures not only the growth of your team but also safeguards against the pitfalls of bad hiring, ultimately contributing to the success and longevity of your business. Contact us today, and let our professionals streamline your hiring process, minimizing risks and maximizing the potential for a strong and successful team.


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