Thursday, November 24, 2011

Critical Corporate Interviewing Improves Retention

When a trusted employee is promoted into management, generally what is their first task? Replace themselves. How do they interview candidates for their replacement? Go to HR and ask for a list of acceptable questions to ask. If they are lucky, HR has a list of “approved questions.” Are the questions targeting the skills required to be successful in the position? Generally not, they are simply acceptable interview questions. Do those questions include, “If you were an animal, what would you be?” Probably not, those questions are usually created by managers who feel they need to ask something more in order to get a better picture of the candidate.

Is interviewing taken seriously in corporate America? If it were, hiring managers would be trained to be more effective in the interviewing process. As a matter of fact, trained and “certified” hiring managers from every company function would be developed. For instance, there would a certified interviewing manager in accounting, another in marketing, another in sales, etc.

If executives truly understood the cost of hiring the wrong person for a job, they would require the same or greater due diligence on the selection of a new employee as they require on the selection of a new corporate acquisition. This due diligence would include a meaningful job description, a meaningful interviewing process, and meaningful due diligence on the selected candidate after the interview.

Let’s examine the cost of hiring the wrong person. The first assumption is that they are in the position for 2 years before they make the grievous mistake that gets them fired (after being put on plan). Let’s say that person is earning $60,000 per year plus full benefits. They are in a decision making position, possibly team leader/supervisor. Let’s also say they have some client contact (customer service is full time client contact). Does this begin to sound like someone your company has hired?

What are your “hard costs” of this hire? Did you pay a recruiting fee, relocation, advertising for the position (Internet postings, newspaper, other), attend Career Fairs, etc.? What time was spent by individuals in your company during the interview process? Did you need to pay the candidate expenses to interview them in person? Did you need to call in an employment attorney prior to letting them go? Did you pay severance? Were you sued by the candidate for wrongful termination when they were let go?

Many companies will glance at their “hard costs” of letting someone go but never even consider their potentially catastrophic “soft costs”.

Let’s examine the “soft costs” of someone who has been in a position for 2 years but is only doing part of their job – and not doing that well. What is the cost of the work that is either not done – or done by another member of the team? What is the cost of their disruption to the team? What is the cost of the credibility of the manager for hiring someone like them? Have they driven away a customer or other employees? What is the cost of managing, coaching, correcting them? What was the cost of the management time spent interviewing them; and then their replacement? Has their employment affected your brand as an employer? How has that affected recruitment? There may be many negative impacts.

On one occasional I conducted an interview training session with a small consulting firm. The attendees included the CEO and CFO. At the beginning of the session, I asked the previous questions. The table with the CEO and CFO estimated that the potential damage to the company could reach to $1 Million over 2 years. Imagine hiring just 4 people like that over a couple of years. Potentially that could make the difference between profit and loss – even between staying in business and going out of business. That is how important interviewing and selection skills are.

10 Tips for Successful Hiring Manager Interviews:

1) Create effective job description that includes the 3, 6, 9, and 12 month goals for that specific position (http://www.recruitingtrends.com/building-an-effective-job-description). This exercise makes the skills and experience necessary to be successful the first year crystal clear. Then the manager is able to focus questions on those skills and experience.
2) Use the goals and the departments this position interfaces with to create an interdepartmental interviewing team that focuses on its specific area and general corporate fit.
3) Create an interview that combines behavioral interviewing with 1 and 2 step interview questions to probe skills and experience.
4) Each interviewer focuses on their skill area – and reports how well the candidate would do in their area.
5) Treat the candidate as a potential client – they may be in the future if they are not already.
6) After the interview and within 24 hours, the interview team meets and discusses the candidate. Each member of team gives thumbs up or down. The hiring manager accepts their opinions and makes the final hire/no hire decision after the reference check/drug test/background test processes.
7) The hiring manager is taught how to conduct reference checks since they know everything the candidate will need to accomplish. Remember, they make critical decisions every day that impact the company. They will conduct a more meaningful reference check than anyone else. Coach them as you would for interviewing.
8) Once the reference check/drug test/background check process is complete, the final hire/no hire decision is made.
9) Based on the information collected during the interviewing and reference checking processes; create an offer based on corporate compensation, budget, and scarcity of candidates.
10) Begin your offer process by selling the candidate on the position again, asking how they will handle the counter offer, and extending the offer.

Using this straightforward process will improve your company’s candidate selection process and improve employee retention.