I recently read “The Second Dimension of Screening Sales Talent” over at SalesHQ. In the article Lee Salz makes some very insightful observations in regard to interviewing and screening candidates. The article compares hiring a candidate to marriage. This may sound a little outlandish, but really it hits the nail right on the head.
With unemployment closing in on 10% the job market is flooded with great candidates. This presents an excellent opportunity for companies to grab some really great talent. Unfortunately I have seen many candidates rejected because they are overqualified. While I am sure there are some instances in which this is just a convenient brush off, many managers really worry about hiring someone who has too much experience or education.
Replacing employees is costly. Studies indicate it costs between 20%-60% of an employee’s annual salary to replace them. That said, candidates are not necessarily interested in hopping around. When deciding whether or not to hire a more experienced candidate look at two areas to determine whether they are a job hopper or a loyal employee.
First look at their resume, if you see they have worked for 5 different companies in 7 years you may want to give them a pass, especially if the position you are offering is a “step-down” from their last position. If, however, you find the candidate has been with the same company for many years this indicates they are loyal. Ask them about their longest running employer, if they worked their way through the ranks and what they liked about the job. If you can provide a similar experience the candidate may be a great fit for your company.
You should also give candidates a comprehensive behavioral assessment to look for traits that indicate the candidate will be a loyal employee. Several behavioral factors contribute to loyalty. Candidates who are fairly sociable, somewhat quiet, and fairly cooperative are likely to make relationships with coworkers that bind them to your company. Candidates who are cautious, accommodating, conscientious, and disciplined are likely to feel a sense of duty associated with their job that will drive them to perform well and discourage them from seeking other employment.
Realize that just because a candidate is loyal it doesn’t mean they are effective. Some employees are loyal simply because they haven’t had any other opportunities. This is why reference checking is so important. A few quick phone calls will let you know whether the candidate was a valuable employee who was the victim of downsizing or a sub-par employee who was the victim of their own lack of performance.
Take advantage of the current job market to hire some great new talent. Don’t shy away from the “overqualified” candidates. Do your homework and hire the best of the best. You won’t regret it.
I just read a great article over at the SlackerManager blog entitled Why Loyalty Matters. In the article the author discusses how and why loyalty among employees has a direct link with corporate productivity and profits. Sadly in the current economic climate only around 30% of employees claim to be loyal to their employers, and even fewer, around 25%, think their employer has earned that loyalty.
Layoffs are commonplace today, but research shows that in the long term layoffs don’t actually save any money and do in fact lower both employee loyalty and customer satisfaction both key predictors of future earnings. The University of Pennsylvania “found that spending 10 percent of a company’s revenue on capital improvements increased productivity by 3.9 percent. But investing that same amount in developing the employee capital more than doubles that amount, to a whopping 8.5 percent”. Research shows if companies focus more on developing their employees they are likely to increase their revenue in the long term.
Investing in your employees is not just about benefits, or training. In fact about 37% of employees who quit did so because of a lack of job fit or because of management. (Gallup 2006) To improve your employee loyalty start with management. Use a personality assessment to discover areas of incompatibility between managers and staff, and then make adjustments. Determine your corporate culture and make sure people will fit before you hire them.
Over at the Harvard Business Blog, Steven Demaio has posted a great article about how to identify and develop the talents of your current employees. Many organizations are in the midst of a hiring freeze, but that doesn’t mean businesses can stop moving. Waiting until the economy revives to innovate, change, and grow is akin to business suicide.
Your current employees are your greatest asset. If you invest some time in your employees you can reap incredible returns. Find out who your employees are, what they like to do, and what motivates them. Maybe even give them behavioral assessments to find out what their natural bent is. Once you learn more about your staff, train them and give them a chance to shine. I guarantee it will be worth your while.