Your Business

Don’t use instinct to hire people

February 2017

Measured questions and workplace exposure are invaluable in hiring staff, writes Fiona Smith.

In 2015 the average rate of employee turnover was 15.7 per cent according to Australian Institute of Management figures. And, while some of those farewells are unavoidable or may even be a relief (as in “thank heavens she’s finally gone”), each person who quits can be mightily expensive to replace.

High rates of people ditching their jobs suggests too much of a “she’ll be right” attitude from business owners and managers: they’re not being real with how complex it is to hire the right person in the first place.

According to Insync Surveys, cutting employee turnover by 5 percentage points (for instance, from 18 per cent to 13 per cent) saves employers around $280,000 per year for every 100 people they have on their books.

That cost takes in more than the price of recruitment. It is also the lost opportunity when a role is unfilled – or is filled by a new person who needs time to get up to speed.

The managing director of Sociomapping, Quentin Jones, says employers often rely too much on their “gut” when making recruitment decisions.

“Recent research on cognitive biases shows gut intuition is often a poor predictor of good fit and performance,” says Jones, whose consultancy analyses and maps team and organisational relationships.

Making snap judgements is a common mistake.

“It’s human nature to judge very quickly whether we like or don’t like someone. Unfortunately, in an interview situation once an initial judgment is made, it takes a lot of evidence and persuasion to unwind these first impressions,” says Jones.

“So, go in with an open mind and be willing to listen to rational evidence as well as emotional impressions.”

Because past behavior is the best predictor of future performance, Jones suggests using behavioural-based questioning.

“While it can be interesting to ask candidates about what animal they think they are, or where they want to be in five years, the research shows these sorts of questions are pretty much a waste of time and you are better off asking about specific behavioural examples that relate to the job,” he says.

Ask questions such as: “Tell me about a time when you provided excellent customer service? What did you do? What was the result?”

When it comes to jettisoning a job, Millennials (aged between 20 and 36) are the biggest quitters. This is partly because they need to move around to build careers, but it can also be because their employers are not working hard enough to get them to stay.

The chief executive officer of career-coaching company TwoPointZero, Steve Shepherd, says the most common reasons recruitment of Millennials fails is that the hiring manager has not bothered to do a proper selection interview or that the young person has failed to do their research.

“All too often I hear stories of managers meeting someone briefly, asking them a few basic questions and ‘giving them a go to see how they work out’ … if they are not right they will get rid of them and get someone else,” says Shepherd.

“This, however, can create a revolving door of employees.”

Young candidates are often just desperate to get a job and small businesses cannot assume the candidate understands the nature of the job.

“They should have their own checks and balances in place.”

In her work as the managing director of workplace consultancy Great Place To Work Australia, Zrinka Lovrencic, gets to see some of the best workplaces.

She says hiring managers should be assessing candidates for cultural fit, which is just as important as looking for skills.

“There are professions and roles where skills cannot be taught on the job – an extreme example would be a surgeon,” she explains.

“However, it definitely makes for a far more harmonious, collaborative, and aligned working environment when employers put cultural fit on the agenda when hiring new employees.”

While money is important for retaining good employees, staff that leave often complain about a lack of growth, autonomy and flexibility.

Lovrencic details some of her favourite hiring and retention strategies:

  • A social media window: Job candidates are given the opportunity to engage with real employees through closed Facebook sites, Twitter and LinkedIn. This lets them see the culture of the organisation, allowing them to join discussions associated with the organisation.
  • Work experience: The top two or three candidates are invited to spend a minimum of 60 minutes “on the job” with the hiring manager and co-workers, and relevant stakeholders.
  • The Love Box: Thank you notes for colleagues go into the “love box” and are read out every Friday at the company meeting. At the end of the month the person with the most love gets a prize.
  • SMART Card: This rewards a team member with a “guru session”, with the manager of their choice and an opportunity to get exposure to someone in the business they admire.