Recruitment
Is your recruitment expenditure just money down the drain?
Did you know that, using traditional recruitment methods (CV, interview, references) you have only a 26% (one in four) chance of recruiting the right person.
This is because:
- ninety-five per cent of applicants will "exaggerate" to get a job
- most recruiting decisions are made in haste - during the first five minutes of an interview
Every day businesses recruit sales people who cannot sell, customer service representatives who frustrate customers and managers who cannot manage.
The tragedy is that many businesses come to believe that such things are normal. They shake their heads and say that's the nature of our industry. Perhaps it's time for a different insight into the problem.
Businesses have three opportunities to impact the performance of their people.
The first is during the selection process. If likely non-performers can be screened out at that stage, the savings are dramatic in comparison to the minimal cost involved.
Unfortunately if the wrong person is recruited, the second opportunity costs considerably more because managers and supervisors must spend valuable time providing extra training to poor performing employees when they should be investing their time in top performers. Top performers usually generate most of the company's profits which means that neglecting them adds opportunity cost to the cost of recruiting the wrong person.
If these solutions fail, the business is left with the third and last alternative, and the most expensive, removing the employee from the business or department. All of the time, energy, and money invested in that individual leaves with them, and the process to replace them starts all over again.
The Chartered Institute for Personnel and Development (CIPD) 2005 survey reported that 85% of companies experience difficulty in recruiting at all, let alone recruiting the right people. Less than 20% of companies used any form of psychometric test whilst recruiting.
The precise cost of recruiting the wrong person is hard to calculate but it exists for employees at every level in an organisation.
As an example, take a customer-facing member of staff whose salary is 20k per year. Even if they have nothing other than basic benefits, this will probably rise to 25k. If they spend 3 unsuccessful months with the company, the cost in direct and indirect benefits is 6.25k.
However, this is only a part of the story. To this cost, you can add:
| Advertising/recruitment | 500 |
| Admin/training/interviewing costs | 1000 |
| Lack of productivity in vacant job | 2000 |
| Sub total | 3500 |
| Add salary | 6250 |
| Total cost of employing the wrong person | 9750 |
Very few businesses can afford to absorb this kind of cost.
Probability of recruitment success
The probability of recruitment success utilising the traditional tools of CV, interview and references is only 26%. Effectively, this means that only one in four of your appointments will be successful. It also means that if you flip a coin when they enter the room, your chances of success will be greater!
The addition of Personality Testing (behavioural traits), Abilities Testing (thinking style) and Interest Testing (occupational interests) raise the probability to 66%. If you add the final step, comparing the output with a Job Match profile, you can increase that probability to 75%.
Profiles International’s Profile XT and Profile XT Sales allow you to benchmark your existing top performers to
provide a comparison with applicants for the same role and ensure that
the best candidates are selected for the role and your company.
