It’s estimated that a failed hire can cost a company as much as $220,000. Can your organization afford a hit like that? Adam Silver offers a unique solution that will result in both improved talent management and professional development plans for employees.
Making the right hire matters
It’s estimated that a failed hire at the mid-manager level can cost a company as much as $220,000 CDN, or 18 months of salary. To reach this figure; wasted training, impacts on productivity and the cost of recruiting and onboarding a new employee all need to be factored in. While this estimate is enough to make companies look twice at their recruitment approach, cost consideration is by no means the only hiring imperative. Ultimately, the ability to make the right hire at the right time—drawing on both the market and internal capability—reflects the general health of the company’s human resources system, as this 2018 Fast Company article makes clear:
“An estimated 42 million employees will leave their jobs in 2018, according to a Work Institute’s 2018 Retention Report released in 2018. The top reason employees gave for leaving was lack of opportunity to learn or develop skills (21%).”
Loyalty and performance are reliably spurred when employees know they can grow and develop meaningfully inside a company. Nonetheless, many employees stagnate in their positions for sustained time periods, while opportunities to move to significantly different roles internally are often limited or non-existent. In addition, and somewhat ironically, the core employee characteristics required for many positions are disarmingly generic. Passion for the job, a team player, the ability to innovate. Sound familiar?
Clearly, the hiring challenge is significant—but so is the opportunity. Businesses that truly understand their hiring requirements can attract top talent externally while nurturing meaningful career development opportunities within; creating an excellent performance foundation in the process.
Hiring beyond gut feel and company culture
Having been repeatedly told that gut feel is no way to make a good hire, businesses often tend towards culture fit when considering candidates. But while culture fit matters, it should never be the pivot point. Indeed, diversity is widely recognized to be an important contributor to overall company strength—with too much homogeneity putting the brakes on creativity, innovation, and general performance.
One way to navigate the binary perils of gut instinct and culture fit in the hiring process is to explore the relevance of conventional management tools such as the RACI and the skills matrix.
The RACI acronym breaks down to the following key elements:
Responsible: The person completing the task.
Accountable: The person making decisions and taking actions on the task.
Consulted: People who will be communicated with as it relates to decisions and tasks.
Informed: Those to be updated on decisions and actions.
Using a RACI matrix allows the company to map activities and decision-making authorities for a project or function against people and roles. It also creates an easily comprehensible dashboard of where different players fit, even if they come from different departments, divisions, or external companies.
The RACI is often viewed as a project manager’s tool that introduces undue rigidity into a process. While this can be true at times, the criticism doesn’t stem from the RACI mechanism itself, but rather from the way it’s applied. At the very least, a properly applied RACI matrix helps eliminate issues arising from poor accountability or lack of role clarity. It’s also very useful in preventing over-participation, which is notorious for slowing projects down while increasing costs.
Similarly, when carefully considered and applied, a skills matrix can play a key role in evaluating staff, driving meaningful career planning within a company and, eventually, hiring effectively. In its simplest form, the skills matrix lists various key skills sets and then defines each staff member’s level of proficiency at the skill, with assessments ranging from ‘Limited’ through to ‘Expert’. At first glance, the skills matrix may not look like a business game changer, but it’s a vital cog within the company’s talent management system. Indeed, an active skills matrix is a living document that gives the company a relevant snapshot—at any time—of all the talent at its disposal.
Old tools, new approaches
These tools can also stretch a lot further than their traditional definitions suggest. This is particularly true when they are used in conjunction with the hiring process. In this context, the RACI matrix pinpoints the skills required (beyond subject matter knowledge) to complete any work, from specific projects through to permanent and interim positions. At the same time, the skills matrix can identify the skills necessary to fulfill a role. If internal capacity doesn’t exist, the company can start an external hunt—for interim or permanent resources—with the knowledge it has fully considered all internal resources.
Crucially, combining the RACI and a skills matrix as described gives staff clear evidence that the organization values personal development plans and is actively opening career paths and opportunities for its people. Equally important, by understanding the roles and responsibilities—and then reviewing the skills required to be successful—employees can continually self-assess their professional development to help accelerate their careers.
Adding a dash of science to talent management lowers costs and stress levels
Established project tools such as the RACI and the skills matrix have survived this long due to their utility, which is rooted in sound business science and experience. Their standard applications may not be conceptually thrilling, but when the framework of application is re-imagined they can add some very needed muscle to the hiring process.
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Adam W. Silver is the Managing Director of the Performance Acceleration practice at Farber. The Performance Acceleration practice helps executives and boards overcome operational and strategic challenges to uncover potential and unleash performance. Adam can be reached at 416.496.3734 and email@example.com.