Imagine your company as a human body, and the employees are your cells, delivering necessary functions and keeping the body alive. To ensure that the body is in good condition, you need to have healthy cells – just like in your company, you need to hire the best employees for maximum productivity.
Your employees are the building blocks of your company. Aside from the fact that they offer the labor needed to produce goods and services that your company provides, they are your valuable resources that offer innovation, inspiration, cognitive prowess, and unique skills.
When the right employees are hired, the long lists of what they can offer can all lead to company advantage.
One of these advantages is the revenue impact they can contribute to your company. According to Dr. Sullivan (Sullivan, 2018), a renowned HR leader from Silicon Valley, the recruiting team must understand that the quality of hire can translate into dollars.
Dr. Sullivan uses Hollywood movies and basketball as examples. By casting Tom Cruise in the movie, or picking Shaquille O’Neal as part of the basketball team, the return of investment was significantly higher as opposed to hiring average performers.
To further support Dr. Sullivan’s statement, Google (Sullivan and Archive, 2012) has reported that a result of 300 times more productivity and impact can be expected from a top performer versus that of an average performer.
Google has been hiring employees with these statistics in mind and this seems to be working well for them since they have now become one of the most valuable brands (Tyler, 2018) of 2018.
The Staggering Cost of Bad Hires
On the other hand, getting bad hires or mis-hires can be very detrimental and can cost your company a lot of money. These costs can involve recruiting fees, training costs, and disciplinary actions.
Dr. Smart(Smart, 2008), the creator of Topgrading hiring method, has found in his study that an average cost of a mis-hire can be around six times base salary for a sales rep, 15 times base salary for a manager, and as much as 27 times base salary for an executive.
The cost of a bad hire can be quite extensive. Not only does mis-hiring cost your company money, but FastCompany(Gillet, 2014) reported that it also causes a negative impact on worker productivity, a lost in time due to recruiting and training another worker, and a decrease in employee morale.
For a more updated and detailed report, Careerbuilder’s (Serrano, 2017) infographic showed that 36% of employer respondents associated mis-hiring with a decrease in employee productivity, 33% of them complained that quality of work is compromised, 31% of them complained the decrease in employee morale, and 30% noted the time wasted finding replacement and cost of replacement.
A slacker co-worker may turn the good employees into rotten apples as well by influencing them to be tardy, committing excessive absences, submitting mediocre outputs and generally a negative attitude towards the team. Because of this unprofessional behavior, these may lead to upsetting your company’s loyal customers.
Mis-hires may need the guidance of the manager more than anyone else in the team. The worst part is that mis-hires may not really care to listen to the manager, resulting in making the same mistakes again – the time spent training them is just time wasted.
Rushing to Hire Usually Leads to Bad Hires
These damages are enough to warn any HR or executive into not making the same mistakes. However, despite these statistics, Careerbuilder’s (Serrano, 2017) infographic reported that 75% of employers have hired the wrong person last year. The reason for that, according to CareerBuilder’s (Frye, 2017) , is that companies are usually rushing to fill up a vacant position.
They found that 43% of the employer respondents made a bad hire because they needed to hire someone as soon as possible. The company maybe understaffed, or the team needs a key member, hence the urgency to find a new hire which can lead to overlooking the qualifications of the candidate.
Help from Professional Headhunters
This is where an experienced executive search firm can be of great help. Whether you’re a big company, or a small scale one, the importance of hiring top performers is a process that cannot be undermined.
Executive search firms specialize in finding high-quality candidates that can take up those empty executive roles you are eager to fill. They are not all the same, of course. When partnering with one, choose the more experience search firms to make it an investment worth your time and money.
The lengthy discussion in the previous paragraphs explains what is at stake when it comes to hiring, it is only understandable that as the executive or HR of your company, you take careful consideration when it comes to choosing which executive search firm you are going to partner with.
Things to Consider When Choosing a Headhunter
Before hiring the services of a particular executive search firm, you must first do a thorough assessment of their capabilities. Below are some of the things you need to look out for when making your choice.
- The method of operation or the process of the search firm has to be taken into consideration – the firm must be able to hold meetings with the client to develop a good account of what the company is about and to understand what the company needs.
- The necessary documentation such as a written description of the position, scope of services, and the timetable is prepared by the firm prior to the start of the search. These are only some of the processes executive search firms go through. In short, the recruiting agency has to have active participation in every step of the way.
- Doing a background check on the executive search firm will also give you a gauge of their skills. It is best to ask their previous clients about their experience with working with the search firm. Were they satisfied? What were the problems they met during the whole process? If the clients have been getting the services of the same search firm for several times already, then this is an indicator that the executive search firm is one that can be trusted and is high performing.
- It is also necessary to know who is actually handling your search. The search manager must be the right fit for your company by having a background in the industry that you are in. You should also be aware of the search load the manager currently have and whether your search will be given utmost attention.
In the hands of an experienced search firm, all of these considerations can be addressed. You can expect a painless process that has been guaranteed to produce results, find repeat clients satisfied with the search firm’s performance and a competent search manager in charge of your search.
These said reasons can back up the claim that experience is undoubtedly a must metric when it comes to choosing your executive search firm. Now that we’ve established this fact, let’s have a more detailed discussion on the characteristics of an experienced executive search firm and how they can help you.
Characteristics of an Experienced Executive Search Firm
Industry experience leads to the better pairing of company and candidate
A great search firm will research the business goals you are aiming for, even before accepting the search. They already have a clear vision of whom to contact, and how to go about with the search – this kind of preparedness and quick action comes with experience in the industry.
Industry experience in this case means that the search firm has a full grasp of the ins and outs of the industry they are involved in. They understand the nuances and trends, and able to utilize this knowledge to raise the odds of a better company and candidate pairing (Waite, 2014).
They recognize that different companies have different brands and culture, therefore they are able to adapt their approach to what they think will best work for your company. It becomes imperative that they make sure to assign the search consultant which best fits your company.
They have already developed innovative ways to spot quality talent through interviews and figure out if that candidate is compatible with your company. If the candidate is identified by them to be compatible, they are able to give justified reasons as to why they think so.
Rich connections and exemplary quality-of-hire in their database will lead to the better pairing of company and candidate
Maintaining contact with the right people and the right companies is expected from an experienced search firm. It is part of their job to know what these people and companies are experts in and they know that these kinds of information can come in handy in the future.
A recruiter’s database is a prized possession in their line of work. It is power, and naturally, they need to keep it growing if they plan on becoming among the top recruiting firm. The best recruiters’ database is composed mostly of employed individuals (Sullivan, 2015). This is because quality candidates are usually already working for top companies.
With their rich database, an experienced search firm will be able to find you the best candidate or poach those candidates from other companies if the need calls for it.
Good time-to-fill record will save you time and money
An experienced executive search firm will have a good time-to-fill record. They will save you a lot of time and the allocated budget for recruiting will also cost you less.
Workable (Howden, 2018) described time-to-fill as “the number of days between the publication of a job and getting an offer accepted”. It can be a measurement of whether the executive search firm’s job advertising is working or not, and whether the executive firm is working fast enough.
Pays attention to customer-service
Keeping customers happy is still an important factor in the recruiting industry – Experienced executive search firms know this, and they greatly value what the candidates and companies have to say.
It is in the best interest of the search firm to respond to clients’ inquiries, may these be in a form of text, calls, or emails. They also understand that an irate client can ruin their image.
Building a good reputation is hard, but ruining it has been made easy, by and through internet. Nowadays, people can post their complaints online on different social media outlets that can go viral and forever tarnish the company. If they’re smart, they would not want to take the risk of displeasing a client.
Bringing It All Together
Top talents are hard to find and investing in your hiring process may take time and valuable resources. But if you do find them, the expected increase in revenue is worth it. It is a strategic move to capitalize on hiring the best candidates than having to suffer the consequences of mis-hiring.
Don’t hesitate to use the help of executive search firms. After all, that is their area of specialization, bridging companies and deserving candidates. What is important is you select the best search firm out there. As the client, doing serious research on the topic of executive search firm and what you should look for in one is going to prepare you for the partnership – reading this article shows serious commitment to the task.
If you already have a prospective executive search firm, then ask yourself these questions: do they have the qualifications as mentioned above? Can they be considered an experienced search firm? Still not sure? Remember to research, examine, criticize, and then evaluate.
Howden, D., 2018. Recruiting KPIs: Time to fill. Recruiting Resources: How to Recruit and Hire Better. Available at: https://resources.workable.com/blog/recruiting-kpis [Accessed July 18, 2018].
Smart, B. (2008). [online] Topgrading.com. Available at: https://topgrading.com/_tg-content/downloads/HighCostofMisHires.pdf [Accessed 18 Jul. 2018].
Sullivan, D. and Archive, A. (2012). Show Me the Money — the Top 10 Revenue Impacts of a Great Hiring Process. [online] ERE Media. Available at: https://www.ere.net/show-me-the-money-the-top-10-revenue-impacts-of-a-great-hiring-process/ [Accessed 18 Jul. 2018].
Sullivan, J. (2018). The Dollar Impact of Great Recruiting: A Must-Do Calculation – Dr John Sullivan. [online] Dr John Sullivan. Available at: https://drjohnsullivan.com/uncategorized/the-dollar-impact-of-great-recruiting-a-must-do-calculation/ [Accessed 18 Jul. 2018].
Sullivan, J., 2015. Checklist For Selecting The Very Best Executive Search Firm. ERE Media. Available at: https://www.ere.net/checklist-for-selecting-the-very-best-executive-search-firm/ [Accessed July 18, 2018].
Tyler, J. (2018). The 10 Most Valuable Brands in 2018. [online] Inc.com. Available at: https://www.inc.com/business-insider/amazon-google-most-valuable-brands-brand-finance-2018.html [Accessed 18 Jul. 2018].
Waite, R. (2014). Factors for Selecting an Executive Search Firm. [online] linkedin. Available at: https://www.linkedin.com/pulse/20140603155158-30964147-factors-for-selecting-an-executive-search-firm/ [Accessed 18 Jul. 2018].
Gillett, R., 2014. Infographic: How Much A Bad Hire Will Actually Cost You. Fast Company. Available at: https://www.fastcompany.com/3028628/infographic-how-much-a-bad-hire-will-actually-cost-you [Accessed July 18, 2018].
Serrano, S. (2017). [Infographic] The High Cost of a Bad Hire and Why You Need Recruiters. [online] The Puzzle Piece. Available at: http://www.sysgen.com.ph/articles/cost-of-a-bad-hire/2119 [Accessed 21 Jul. 2018].
SHRM. (2017). The Cost of a Bad Hire Can Be Astronomical . [online] Available at: https://www.shrm.org/resourcesandtools/hr-topics/employee-relations/pages/cost-of-bad-hires.aspx [Accessed 21 Jul. 2018].