SMARTEK BLOG

What’s the cost of hiring the wrong club executive?

Recruitment isn't always easy. We've all had the experience of working hard to secure a perfect candidate only for them to move on too soon. The reasons for recruitment failures are plentiful. Maybe you didn't account for cultural fit, maybe you neglected to do a proper reference check or maybe your candidate's interview skills were much stronger than their performance. Whatever the reasoning, bad hires can cost companies a lot.

Making a bad hire can have massive implications for a business.Making a bad hire can have massive implications for a business.

In fact, many major management problems can be traced back to poor hiring decisions and the financial impacts are no small consideration. A study by G&A Partners calculated turnover costs and found:

  • A single entry-level non-skilled position equals out to approximately 30 to 50 per cent of their yearly salary.
  • Supervisors or technical employees cost up to 100 to 150 percent of their annual pay.
  • Turnover in administrative roles result in a company cost of 50 to 80 per cent of their annual salary
  • Skilled hourly roles run a turnover price tag of 75 to 100 percent of yearly salary.

But it's about more than just the money. Bad hires can affect the morale and productivity of the entire office. In fact, 41 per cent of businesses see a decrease in worker productivity following the removal of a bad hire, according to a Harris Interactive study. Another 41 per cent of organisations saw a decrease in worker productivity following the removal of a bad hire, 40 per cent noted they lost valuable time when having to recruit and train a replacement and 36 per cent reported an unfavourable impact on office morale.

What are the common catalysts for bad hiring decisions?

When you pick the wrong candidate, you lose time, money and team productivity. To address any problem adequately you need to first identify the root of the problem. What causes bad hiring decisions? Why do they keep happening?

The issues with recruitment processes can really be boiled down to three core themes: Time, vetting and references.

Theme #1: When businesses are pressed for time to find a replacement for a position this can lead to hurried hiring decisions. We all know when we rush through anything the likelihood of mistakes increases tenfold. If you can take your time with the recruitment process you're much more likely to find a perfect fit.

When you pick the wrong candidate, you lose time, money and team productivity.

Theme #2: Conducting background checks, otherwise known as vetting, is a key element of the hiring process. When you don't vet potential hires for your club executive position your risk hiring an employee with a shady past or unethical tendencies. Doing your due diligence during the recruitment process is key.

Theme #3: Reference checks from former managers or colleagues are just as critical as background checks. As such, neglecting to conduct these assessments often contributes directly to poor hiring decisions.

How can you ensure you're hiring the right club executive?

Okay so enough on what not to do, let's learn more about how to get things right. We know that rushing hiring decisions is one of the biggest mistakes companies making when recruiting. This means the converse also tends to be true. Sure you can't spend 5 months looking to fill a single vacancy but you can ensure you dedicate the right amount of time to making a thoughtful and thorough selection. Giving yourself this time will inherently decrease the potential for making mistakes.

Before you even begin the hiring process, make sure you know what you're looking for. Bring your team together and brainstorm some key character traits and professional skills that are essential. Ask yourself:

  • What kind of personalities are we missing in the company?
  • What are some of the key skills critical to this role?
  • What do we need from a candidate and what do we really want?

Whatever you decide, this list of attributes will help guide you during the recruitment process.

Sit down with your team to determine which attributes you need from a candidate.Sit down with your team to determine which attributes you need from a candidate.

Lastly, never ever forget to conduct your reference and background checks. Reference checks allow you to dig deeper into key aspects of a candidate's performance. No one knows how your potential employee will perform better than their past employers – don't neglect this critical step. Once these are completed make sure you run a thorough background check. Check for things like:

  • Criminal record
  • Work history checks
  • Credit and debt
  • Identity checks
  • Reviews of any legal proceedings
  • Personal references
  • Education verification

If you're still worried about perfecting the recruitment process when hiring your next club executive, Barringtons is here to help. Our team has been working closely with Australian clubs for decades throughout the entirety of their recruitment processes. To learn more about how we can help, reach out to us today!

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