Your Cost of a Bad Hire is Still Too High. Here’s Why.

Have you added up the cost of a bad hire at your company?
Chances are, it is higher than you think. If you’re going to run the math,
there’s a lot more to consider than an individual’s salary. Be sure to include
costs related to recruiting, hiring, and onboarding. And the opportunity costs
of failing to hire an excellent team member, such as lost productivity.

Look at what happens when you hire a business developer who
exceeds his or her annual sales quota. Revenue gain can exceed your
compensation costs by a large margin. When you make a bad hire, the opposite is
true. In fact, it’s worse. Lost revenue piles up quickly. Then you’re staring
at the additional cost of going back into the job market to hire again.

As we’ve said before, mis-hires are
silent killers
within most organizations.

Fortunately, there are several ways to build up your
immunities. First, know what makes your company culture unique. Remember that
job titles and descriptions don’t always spell out the keys to a new hire’s success.
Pay attention to the ideal roles that your job candidates are seeking. Lastly,
make sure your top candidate is truly a great fit for the role before making an

A little time early in the recruiting process can prevent a
hiring decision that you might come to regret.

Understanding company

Because we have long-standing relationships with many of our
employers, we can recognize certain hiring behaviors. We know from experience
which companies are likely to recruit a Stanford MBA into a role on a
management track. How? Because this is what some companies do every time.

You’re never going to change someone’s mind about who they are
or how business is done. If we’re hiring for an organization that expects quantifiable
metrics to support all decisions, the new hire must be ready to work this way.

Industry experience goes a long way. A leadership change can
have a big effect on company culture. So can a strategic shift in business
goals. When you’ve worked in the industry long enough, you pick up on all sorts
of patterns and cues. You gain insight about companies and the executives who
run them. You build a network of professionals who can share their own
observations. Sometimes, you get the sense that you understand people’s
tendencies better than they do.

Keys to success

There’s only so much you can learn from a job description
about what it takes to make a great hire. Here’s an example. A Project Manager
is a critical role for any project developer, someone who manages the
installation crew from day to day. Any job description will likely state that
job candidates should have relevant experience. They should be able to advance
projects from engineering and design to construction and commissioning. They
should also be able to communicate effectively with customers, permit
inspectors, and utility personnel.

Some great hires will check all the boxes. Unfortunately, some
bad hires will, too.

What you’ll never see in a job description is that you may
be dealing with a confrontational permit inspector, and you’ll need to cite
building codes word for word to get projects approved. Or that the installation
crew responds best to a collaborative, democratic management style.

Job candidates will not always pick up on differences in
culture from one company to the next. There are good reasons why job
descriptions do not always spell out the key metrics for success. But make sure
your hiring manager understands them and uses them to navigate the recruiting

Think about ways to identify great hires and potentially bad
hires during the recruiting process.

Candidates’ ideal

By the same token, there’s only so much an employer can
learn from a job candidate’s resume. We all know resumes and answers to
interview questions reflect a job candidate’s best shot at gaining a job offer.
That doesn’t mean job candidates are equally well suited for all companies and
all roles.

If you know that your next project manager will have to
contend with a salty inspector in the permitting office, find out how job
candidates would handle the situation. Consider ruling out candidates who would
struggle or might seem in over their heads.

Likewise, if you know your installers expect that management
will value their input, think twice about recruiting someone with an autocratic
leadership style. The best candidate on paper may not be the best match for
your organization.

Someone who understands the ideal role that your job
candidate is seeking can cut through the noise in the recruiting process and reduce
the chance of an unsuccessful hire.

Avoid the cost of a
bad hire

Not long ago, we wrote about the differences between qualified
candidates and job fit candidates. Both have the required skills and
experience. However, not all qualified candidates match up with a company’s
culture or a newly created role within the company. In recruiting, focus from
the start on finding job
fit candidates

The work is mostly done if you’ve already taken time to
consider what’s different about your company. Don’t settle for descriptions
that apply to lots of companies, like ‘we are driven by a commitment to quality
and customer success.’ Instead, think about how people interact and the
leadership qualities that get rewarded.

Use the same mindset when evaluating job candidates. Ask
yourself, do I have a clear sense of how these individuals will adjust to our
company’s way of doing things? Without taking risk, there is no reward. But
take care to assess the risks and mitigate them as best as possible.

Once you understand the company culture and a job
candidate’s ideal roles, it’s easy to recognize when you have a match. And you
can proceed with confidence knowing the cost of a bad hire and taking steps to
avoid it.

Any questions?

Get in touch with one of Peak Demand’s experienced solar and
energy storage job recruiters by emailing
or calling (916) 565-2700.