Source | Linkedin.com | Nupur Kashyap, Management Candidate at NMIMS
In the advent of changing times, no organisation can promise a guaranteed future. The only sustainable advantage that one can have is the effective utilisation of the ‘talent’ available. More so, the ability to hire and retain the best people is an art in itself. A good hire’s contribution to the end result is immense. On the contrary, an average or poor performer not only affects the bottom-line, but also impacts the company’s brand image, results and reputation. Most companies make use of Measures such as cost per hire, volume of hires, or even the speed of hire, However, these are at best misleading and at worst, an inaccurate measure of staffing performance. The primary (or perhaps sole) measure of hiring success should be the quality/ performance of the hire. Thus it becomes imperative to focus on the long neglected ‘quality of hiring’. Quality of hire represents the value new employees bring to the company, and therefore demonstrates how effective the recruitment team is at finding and connecting hiring managers with the right people for each available job. What sets it apart from all other metrics is its ability to be omnipresent in all industries.
Global Trends for Quality of Hiring
Talent leaders continue to value quality of hire as the most important metric to track performance, and most organisations are measuring it with employee turnover. This could be why employee retention has emerged as a top priority over the next year. Also, employee referral programs are a key source of quality hires and are growing as a long-term play. Lastly, talent acquisition is investing more in employer brand, and working with cross-functional partners more than ever.
The following are few facts which have reaffirmed the above statements: –
1. 39% agree that quality of hire is the most valuable metric of performance.
2. 50 % measure quality of hire through new hire performance evaluation.
3. 50% measure quality of hire through turnover or retention statistics.
4. 49% measure quality of hire through hiring manager satisfaction.
Since, it is a difficult metric to track, the biggest challenge lies in its implementation. Talent leaders aren’t convinced that they’re measuring quality of hire effectively. Only 33% of respondents feel that their methodologies are strong, and an even smaller 5% felt “best in class. “Therefore, there’s a lot of opportunity to improve how you calculate and present quality of hire.
The below figure reaffirms the aforementioned facts.
Figure: Global respondents on effectiveness of current measures
Ways to calculate Quality of Hire
The measurement of quality of hiring is still an evolving process. There is no full proof formula that can be considered. This can be attributed to the fact that each organisation prioritises different parameters with changing times.
There are two ways of measuring quality of hiring. These are as follows: –
a. Before Hiring – This can be carried out by implementing pre-employment tests and using candidate information available at the time of the interview. These include number of counter offers received, how many top performers know them etc.
b. Post Hiring – Here, once a candidate is absorbed in the organisation, various parameters are used to evaluate his/her effectiveness in the organisation.
Thus, Job performance and productivity, ramp-up time to reach acceptable work levels, engagement with the company and cultural fit, and job tenure should be on every HR leader’s mind in relation to quality of hire. This is usually done post hiring.