There are many reasons a hire might not work out, from poor cultural fit to lack of adaptability or underperformance. Whatever the cause, one thing remains consistent: the biggest cost of recruitment is when it goes wrong. 

These costs include financial losses, wasted time, damaged morale, and finding yourself in the same position a few months later, trying to re-hire. That’s why it’s critical for employers to understand why bad hires happen: so that they can take steps to prevent them in the future. 

Direct Financial Costs 

As we know, an employee’s salary isn’t as simple as X per year, there are a number of other costs associated with an employee including: national insurance, pension scheme, benefits, equipment/software, etc. There are also a huge number of costs included within the onboarding process, which, when considering the training associated with a new candidate joining your team, can become very costly indeed! 

Rehiring Costs 

So now what? Your hire has gone wrong; you need to re-advertise and re-hire for the position. At this point, you don’t just lose what you’ve already invested, you also need to completely start over: 

• Writing and advertising a new job advert. 

• Either you have an internal recruitment team or an external agency – you will need to consider resource time or fees again here. 

• Time investment from hiring managers and time dedicated to the interview process. 

• Repeating the entire onboarding and training process. 

The Hidden Costs 

The hidden costs associated are a lot harder to measure, however, you need to consider what impact a bad hire can have on both a business and other team members. 

• Time – A recruitment process is time consuming, getting it wrong and having to restart the process will impact time that needs to be spent on other duties, which only results in a lose/lose. 

• Team Morale/Productivity – Team members can often become frustrated with the additional workload they may need to take on, resulting in them unable to fulfil their own requirements within the role. Equally, poor performance from an employee can impact the rest of the team and drag down productivity. 

• Customer Experience – Whatever the reason the hire didn’t work out, it is important to end the relationship on good terms in order to avoid bad reputation. 

• Lost Opportunities – This is easier to articulate in commercial roles, but often as a company you won’t get the opportunity to make a first impression twice when pitching to your top prospects.  

How To Prevent 

1. Value and aspirations alignment – This is KEY when hiring the right candidate on a long-term basis. It’s so difficult to change a candidate’s values (and we’d argue you shouldn’t try) and if you have misaligned aspirations, there will always be friction but if these totally align you are 90% there to a long-term successful relationship.  

2. Really scope out what you are looking for and define the role definitively. 

3. Define which are the essential skills and which are just desirable. 

4. Understand what it really is that you are looking for; what is most important within your team? Could you consider recruiting potential who fits the culture, rather than ability with concerns on cultural fit? 

5. An honest approach throughout the recruitment process, which includes providing a ‘good, bad and ugly’ overview throughout the interview process so that the candidate knows what to expect. 

6. Lay all your cards on the table and ensure the candidate understands realistic performance expectations, and how this will be measured. 

7. Talk to us! Whilst we might not be the right fit for every client, our MD Ben offers a complimentary consultation to teach you how to recruit yourself. Alternatively, if we are the right fit, we are always delighted to have a conversation about our process. 

E: aoife@thompsonandterry.co.uk 

T: 01235 797 177