When we talk about the cost of a bad hire, the money spent is like an iceberg, with much more lurking below the surface.
1. The money drain: How expensive is a bad hire? In a word, substantial. It includes not only the salary paid to the employee but also recruitment costs, training expenses and potentially severance pay if the employee needs to be let go.
2. Wasted time: On average, replacing a bad hire takes five weeks. That’s more than a month of lost productivity, not to mention the time HR, managers and colleagues spent training and mentoring the employee who left.
3. The impact on team morale: When a new hire doesn’t meet expectations, it puts additional stress on existing team members. They often have to pick up the slack, potentially working longer hours or taking on extra responsibilities. This can lead to frustration, decreased job satisfaction and even burnout among top performers. In extreme cases, it might even prompt valuable team members to seek opportunities elsewhere, compounding the cost of the initial bad hire.
Considering these factors, a timely hiring process is essential.
But, given the consequences of a bad hire, you can’t rush too fast.
The challenge lies in balancing speed with thoroughness to avoid the potentially hefty cost of a bad hire. Rush the process, and you risk making a poor choice that could lead to a bad hire. Move too slowly, and you might lose top candidates to more nimble competitors.
The consequences of a bad hire due to a rushed process can be severe: decreased productivity, lowered team morale and the need to restart the hiring cycle. On the flip side, the risks of delay are equally worrying: missed opportunities, increased workload for existing staff and potential loss of market share or client satisfaction.
