The cost of a wrong hire: Competencies to the rescue

When it comes to the recruiting and hiring process, technical knowledge, education and experience, while important initial screening criteria, are not the elements that distinguish between average and superior performance. Behavioral attributes (defined competencies) are the characteristics that are directly associated with superior performance.

The cost of a wrong hire can climb up to thousands, if not hundreds of thousands, of dollars, depending on the complexity of the role. Because it isn’t all about the cost of the hiring process, but also the training, coaching, and, more so, the execution of wrong decisions made by someone ill equipped for the job to begin with.

Second-round hiring can be costly, but a Competency Model tailored to the employee hiring process can help you get it right the first time.

Starting over, again

Aside from time and money wasted, beginning the hiring process again can also lead to a decline in employee morale, depending on how many people are affected by the situation and how long this search has lasted.

According to recent studies, the typical costs of recruiting and hiring new talent are:

• $5,700 – $8,900: Average cost to recruit for entry-level positions (higher for executive level considering wider span recruiting and relocation costs).
• $1,000 – $1,500: Average cost to train a new employee (higher for entry-level considering less previous experience).

Now add another:

• $5,700 – $8,900: Average cost of second-round recruitment
• $1,000 – $1,500: Average cost of second-round training

Getting it right the first time

Considering these high costs, the ability for HR professionals to pinpoint characteristics differentiating the average worker from the superior worker is crucial.

A competency-based system will help determine the list of characteristics the role you wish to fill requires, for example:

• Decision-making
• Teamwork
• Organizing
• Influence
• Stress tolerance
• Initiative
• Etc.

When used correctly, a Competency Model serves as the foundation for narrowing the right candidates down, once the initial screening process is complete. It will not only make your hiring process easier; it will help you build optimal teams.

For a more in-depth analysis, please visit our webpage on Competency Management and learn how to Build Competency Models that will help you to assess and select high performers.

To learn more about our products and services, and how competencies and competency models can help your organization, call 800-870-9490, email info@workitect.com
or use the contact form at  Workitect.

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