According to a survey by Monster.com of 639 small business owners in the U.S., it cost an average of $6,480 for small business owners to replace a “wrong hire” in 2015. That estimate is on the low end of the spectrum. The U.S. Department of Labor estimates it can cost on average one-third of a new hire’s annual salary to find a replacement. Others believe it’s even higher than that. According to a study by the Society for Human Resources Management (SHRM), it can cost up to five times a wrong hire’s annual salary, depending on the circumstances. The person’s position, how long that person was in that position, and the size of the company all contribute to this cost. According to SHRM, a “wrong hire” at a big company earning $80,000 per year (having been in that job over a year) could cost up to $400,000 to replace. And the “wrong hire” of a CEO in a national company can cost millions to replace.
The expense of a “wrong hire” comes right off the bottom line. That is money spent that adds no value to the business, except perhaps in shaping future hiring practices. A “wrong hire” might teach a manager what to avoid in the future; but often doesn’t even do that. Still, it would be nice if that lesson could be learned without paying such a steep price, especially since Harvard Business Review indicates that as much as 80% of employee turnover is due to bad hiring decisions. Perhaps, then, it would be helpful to know which types of people to avoid hiring and how best to recognize those flaws.
When looking to hire employees, managers often confuse talents, skills, knowledge and strengths. A talent is an innate ability, while a skill is an ability that is learned and nurtured over time. A person might be a naturally-gifted writer even while never having taken any kind of writing class. That is a talent. That same person might also take a course in online advertising and attain the Google Adwords Certification. That is a skill. If that person attends a college and takes a host of classes in business, sales and marketing, that person attains knowledge – and perhaps a degree – in business administration. If that person then gets a job in which she is using her writing talents, online marketing skills, and sales and marketing knowledge, over time this will become her strength. A strength is the ability to consistently produce a positive outcome through superior performance of specific tasks. When a company recruits and hires staff, it looks for people who have particular talents, skills and knowledge.
However, there are certain qualities that are very important for employees to have which are not innate talents, nurtured skills or learned knowledge. These are often traits that are simply a part of who the person is. Over time, some of these traits can be honed, but they are generally not “learnable”. Last week, we considered five of these innate qualities: being on time every day; having a strong work ethic; putting forth maximum effort; having affirmative body language; and having a passion for work. While these might seem like things that can be learned, the truth is that people don’t generally change their work ethic, effort, passion, or body language. They can try to improve those things for a short time, but they usually revert back to their normal level of energy, their true degree of passion, their ingrained body language and their usual work ethic in time. The same is true of their attendance and punctuality. A person might do better for a while, but eventually a person who has a problem with punctuality or attendance will revert back to those bad habits. That is why screening for these qualities in new hires is so important.
Here are five more invaluable qualities that an employee should have and employer should want that requires absolutely zero talent. Continue reading
In the search for top talent, employers typically cite the most difficult, technical skills needed to do the job. For instance, a current ad on LinkedIn for a CFO seeks a candidate with: “Extensive experience in financial analysis, identification of month end financial drivers, and forecasting.” The ad adds that the right candidate will “drive growth through product diversification and geographic expansion, and provide leadership and vision for all finance-related activities in the market, including developing and monitoring progress against Annual Operating Plan.” This ad is designed to filter out the unqualified and underqualified. But what the ad doesn’t address are the soft skills and qualities that ensure the candidate fits well with the organization. Those are either touched on during the interview process briefly or are not addressed at all. And while the inability to do the job does account for why some people fail at their jobs, most people are fired or laid off from jobs due either to personality traits or work habits that don’t fit with the employer.
The truth is that some of the most invaluable qualities that employees need to have and employers want from their workers require zero talent. These qualities are related to a person’s EQ (emotional quotient) and SQ (social quotient) rather than their IQ (intelligence quotient). The next time your company is screening to hire an employee – from an entry level clerk to a top C-Suite exec – they should make sure that the person brings a high level of these 10 invaluable qualities. Continue reading
The very recent vote by Great Britain to leave the European Union – dubbed by media as the Brexit — has sent shock waves through financial markets, political institutions, and businesses worldwide. Despite polls prior to the election indicating that the vote to leave would prevail, the world was taken seemingly by surprise when it came to pass. The pound sterling tumbled to a 31-year low. British political parties were thrown into upheaval. Stock markets around the globe took dives. And the fall out is far from over. But, apparently, many who voted to leave the E.U. are now saying that they wish they could take back their vote. Kelvin Mackenzie, a columnist for the British Sun newspaper which backed the leave, said he was suffering from “buyer’s remorse,” regretting his vote. He was not alone. Emily Tierney, a columnist for the Independent newspaper, wrote “If I could take my vote back now, I would. I’m ashamed of myself.” They are not alone. A Survation poll carried out for the Mail on Sunday after the Brexit vote found that of the 17.4 million who voted to leave, 1.1 million say that they wish they had voted Remain. Given that the leave vote prevailed by only 4% of the votes cast – or 1.2 million votes — that is a monumental case of Buyer’s Remorse.
The truth is that any transaction that involves the ‘purchase’ of a product, service or idea must contend with the possibility and consequences of “buyer’s remorse.” For retailers, “buyer’s remorse” is part of what fuels returns. So what is Buyer’s Remorse anyway? Why does it happen? Is there a way to curb or eliminate Buyer’s Remorse completely? Continue reading