Quality of hire is a hot topic right now, sometimes discussed as the definitive metric for recruiting effectiveness. We have had doubts that it is a reliable measurement.
Tim Sackett, President at HRU Technical Resources, wrote in his blog on August 17 that quality of hire is meaningless. He cited five reasons why the 40% of practitioners who said QOH is the top metric for 2016 don’t know what they are talking about. Here’s our summary of his reasons:
- Almost nobody knows how to measure it.
- Everyone measures it differently.
- Measurement takes time, and there are too many variables over that time to pin the success or failure on recruiters.
- Neither is sourcing a reliable predictor.
- Most recruiting managers believe retention is a valid QOH measure. As Sackett says, they also “believe in purple squirrels.”
We can sympathize with the recruiters. They have fallen prey to the same disease HR metrics have been dying from for 30 years. Too often, we settle on what is easy to measure rather than what is meaningful. These are the top three metrics for quality of hire and why they don’t work.
- New hire performance evaluations. Who trusts performance evaluations? The most influential factor is rater bias.
- New hire turnover. Are we to believe that culture, employee development, and working relationships are not the deciding factors?
- Hiring manager satisfaction. We let the manager who made the hiring decision rate the recruiter on the quality of that decision?
A Different Perspective
Robin Erickson, Ph.D., of Bersin by Deloitte brought a new perspective to the conversation. Her research found that the most influential predictor of recruiting’s performance is a strong relationship between the recruiter and the hiring manager. For us, that was true. We couldn’t imagine operating effectively without a strong working relationship.
According to the research, a disconnect does exist in many organizations. Erickson offers excellent recommendations for improving the working relationship, but we remain skeptical about relying on hiring manager satisfaction unless we can validate the results with analytics.
Here’s our big question: do you measure quality of hire because you need to improve it or because you need a metric for recruiters? Wouldn’t you be much better off using metrics that measure recruiters, not your onboarding program, the judgment of your hiring managers, or your company culture?
How You Can Improve Quality of Hire
The good news is there is a way to improve quality of hire, and if you adopt the right method you will not only hire better people, you will shrink the probability of a disastrous bad hire. The answer lies in understanding what it takes to be successful in each role in your organization and screening out those who are not likely to succeed by using psychometric testing.
Pre-employment psychometric testing works and costs have fallen over the past two decades. The percentage of companies using them grew from 26% in 2001 to 57% in 2013.
We spoke with Mark Tinney, President of JOBehaviors, Inc., a psychometric assessment firm that claims among its clients SYKES Enterprises and the Seattle Seahawks. We walked with Mark through a scenario where a trucking company with 100 employees can recoup its cost of assessments by avoiding only two bad hires per year. According to Mark, that estimate doesn’t reflect the gains that he routinely sees in his practice. Clients in that industry can see as much as a 50% reduction in churn.
Conclusion
Our conclusion today (subject to change) is that the combination of strong working relationships and good judgment assisted by analytics are a powerful combination that can place the quality of your hiring process in the top tier. It just might be the beginning of your organization’s development into a data-driven culture.
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