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We hear all the time that people are our most important asset. But if you’re a business leader, I want you to ask yourself: is this truly reflected in your talent strategy?
Let’s look at some of the numbers around talent…
- 50% of all new hires fail within 18 months
- …even though we spend as much as $7,645 hiring each employee
- Furthermore, we spend thousands of dollars or more every year trying to improve employee performance with diminishing returns
These numbers are so abysmal because the way we recruit people and inspire performance is outdated by about 50 years. And yet companies are still clinging to these antiquated processes and expecting different results.
All of our business challenges can be traced back to people challenges. We see the direct impact of open seats, bad hires, and poor performance in our bottom line. As a result, it’s high time that business leaders took a good look at their talent strategy and asked themselves if it’s up to par for 2020.
If you’re uncertain how you might improve recruiting and performance at your organization, consider the following ideas.
Using Data to Recruit the Right People
Whenever possible, companies now use data to inform their decisions. Today’s technology allows us to track and analyze more data than ever possible. So why aren’t more businesses using data to inform our hiring decisions?
With advanced people analytics, we can whether someone can succeed in a given role. For example, the analytics provided by the Predictive Index give us insight into how someone will behave in different situations and on particular teams. Understanding that 95% of business success starts with hiring great people, it only makes sense to use every tool at our disposal to select the right candidates.
Analytics to Drive Greater Performance
Hiring the right people is only half the battle. Once we bring on great talent, we need to ensure they’re performing in a manner that drives results and profits. Whether it’s bonuses, raises, perks like free food or remote work, we offer so much to our teams to encourage them to perform. Unfortunately, we know that these rewards only boost performance over the short-term – if we’re lucky.
With scientifically validated people analytics, we can actually use data to understand what will foster or hinder productivity among our teams. Rather than second-guessing what someone needs to succeed in the workplace, we can turn to data to understand what will empower them to perform. In a nutshell, these analytics allow us to take the guesswork out of performance management. Just like using data in hiring, it’s a scientifically proven process for driving greater results.
Rethink the Traditional Recruiting Model
When companies are unable to meet their recruitment needs themselves, they turn to third-party recruiting agencies. Recruiters have a pretty bad reputation among a lot of people, and to be entirely honest, there’s a reason for that. They’re often either notorious for submitting poor quality candidates or outrageously expensive. Take the contingent recruiting model – it sets up a direct conflict of interest between taking the time to make a quality placement and rushing to fill a role so that the recruiter can cash a commission check.
More and more companies are turning to recruiting companies with an hourly pricing model. We’ve used this model for over 20 years and have worked with many of the same clients for years as a result. In fact, we’ve routinely been able to land quality hires with an average cost per hire of 13% – much lower than the expenses associated with traditional firms.
Use Processes that Are Proven to Work for 2020
Many recruiters are still using processes that haven’t been updated since 1970. Likewise, a lot of companies are leaning on performance management techniques that we know are ineffective. Why keep using the same broken processes when we can use validated, proven methods?
If you’re a business leader, you need to ask yourself what steps you’re taking today to get better talent and unlock their best performance. It could determine whether you succeed or fail!