The High Cost of Volume
November 30, 2009
Volume. The mere mention of volume when it comes to hiring can produce sweaty palms in most hiring managers. When I think of doing anything in volume, an unforgettable picture comes to mind. I think of the “I Love Lucy” episode in which Ethel and Lucy go to work for a chocolate factory. They struggle to assemble the few chocolates they are given, and then their supervisor increases the quantity of chocolates they have to make. Eventually, they crash. They can’t handle the volume.
High-volume hiring is also intense. It can be challenging and overwhelming in any industry. To top that off, our present economy leaves little room for expensive mistakes when it comes to human capital decisions. No pressure.
Employers that hire high volumes of employees have specific challenges to face when it comes to hiring. One of the greatest concerns in a high volume environment is safe hiring. High Volume Employers (HVE’s) know that if they don’t take measures to conduct pre-employment screening and exercise due diligence in hiring, it is a statistical certainty that they are sitting ducks for expensive litigation, workplace violence, false claims, theft, embezzlement and economic loss. On the other hand…most HVE’s are facing budget restraints. A balance has to be met.
The Danger
Let’s look at the facts. Just one bad hire can cost a firm literally millions. Studies show that screening reveals criminal records for up to 10% of job applicants and at least one-third of all resumes contain material falsehoods. For food establishments, manufacturers, hotels and other businesses that have a national brand, one negative employee-caused event can result in significant damage to the company brand. Who has the time or the money for that?
The Cost
Large hourly employers face enormous financial and logistical challenges in implementing safe hiring programs. Screening large numbers of candidates can be expensive and time consuming. HVE’s tend to work in industries with large numbers of hourly, seasonal, temporary or contract workers and/or significant turnover. With that in mind, how can these employers protect themselves without breaking the bank?
The Balance
The answer is probably less complicated than it first appears. One way to bring costs down is to add weight to the front-end of the hiring process. Many firms make the mistake of believing that in order to show due diligence, they need to spend a great deal of money to perform background checks and criminal record research. It doesn’t have to be. Employers can train their hiring managers to weed out potential problems at the beginning of the process by implementing a thorough screening strategy that includes:
- a company-structured application
- a phone screen
- thorough behavioral interviews with at least two hiring managers
- in-house skills testing
- reference checks
By intensifying the front-end of the process, you can eliminate most candidates that could have been a problem, anyway. Only when the candidate has passed the front end of your process, do you need to perform a background check. You can save screening costs by only doing a background check on candidates you are ready to hire. Finally, be sure to keep several qualified candidates in your pipeline in case some of your final choices fall through.
All Aboard
The most important thing you can put into place for this strategy is a system. If you recall, Lucy and Ethel were pushed into a room with no training, and given no set strategy for getting the job done. They had the tools, but no instruction. Make sure that your entire hiring staff is on board with the new strategy and are trained to interpret applications and conduct interviews with high perception and efficiency.
Evaluate
After your system has been in place for 30-60 days, plan to evaluate the efficiency and efficacy of your program. Check and re-check attrition rates and causes, and begin to adjust your plan to improve in weak areas. Most importantly, communicate any changes to your plan quickly and clearly, company-wide. Let your hiring managers know that a portion of their compensation and advancement will be based on the attention they pay to the hiring process. Organizations typically thrive in areas that are measured, audited and rewarded.
We are heading into 2010, and everyone is looking forward to continued recovery. However, we have to prepare ourselves for the new expectations that accompany a downturn of the magnitude we have just experienced. Corporations are already beginning to hire again, but with the cost of turnover presenting at 1.5 times the salary for a position…we don’t have the time or the money for hiring mistakes. Now is the time to innovate new screening strategies with your team. The team you build now will be the team that evaluates and trains the new hires once this recovery speeds up. Prepare them for success.
Melissa Johnson is Assistant Vice President with Delta Dallas Call Center Staffing. Reach her at 972-788-2300 or mjohnson@deltadallas.com
Killer Interview Questions
November 2, 2009
I have been recruiting for 20 years in the area of accounting and finance. One thing I can tell you for sure is that the hiring process is never easy. It’s hard. Interviewing well is probably one of the most critical skills in my profession as well as one of the factors that most deeply affects my clients.
Think, for a minute, about how absurd an interview can be. You have to sit down with a virtual stranger and be able to assess how a person will work and behave after spending only a brief time with them. Afterward, you must listen to what their references say about them and perceive what their references are not saying. Maybe you bring them back for a second interview, or have team members interview them as well. . .whatever you do, if you hire them, you will be spending about 2000 hours or more with them a year. You will trust the person you hire to perform well and bring results.
Jack Welch says, “…hiring great people is brutally hard. New managers are lucky to get it right half the time. And even executives with decades of experience will tell you that they make the right calls 75% of the time at best.” With that in mind, I decided to call some of the top financial managers in the DFW area to ask them what interview questions they considered to be the most critical. Their answers were telling. Although some of the interview questions they ask deal with the requisite skills provided for the position they are filling, the questions most of them considered vital had to do with a person’s attitude, character and work ethic. That being said, these questions could work in a variety of professions, and their answers could just bring the additional clarity you have been looking for in an interview.
1. Are you a leader or a follower?
-Rob Graham, Corporate Controller, Permian Tank and Manufacturing, Inc.Whether the person is a leader or a follower, they should be a good team member. The manner in which they answer this question could be an indicator of how they will fit in with your department, your team and in the specific role they are applying for.
2. In five words or less, describe yourself.
-Rob Graham, Permian Tank and Manufacturing, Inc.You can glean a lot from the way people describe themselves. Most interviews contain a sort of “tell me about yourself” question, but this question forces the applicant to be precise. Management style, personality type, leadership ability, work ethic, and even personal priorities can be discovered through this kind of question.
3. What do you do when you are not working?
-Jason Kulas, CFO, Santander Consumer USAThis is one of my favorite questions. When a candidate begins to talk about their hobbies and their interests, I get a better idea of who they are and what their priorities are. If someone has a hard time coming up with outside activities, it can be an indicator that their life is out of balance, or that they are not able to be transparent.
4. How do you build capacity in those you lead?
-Joe Christian, Director of Rates and Regulatory Affairs, Atmos EnergyManagers are a dime a dozen, but true leaders are worth their weight in gold. Organizations are more commonly looking for those individuals who can not only lead others, but build skills in others. For management positions, asking this question can help you determine if the candidate values mentoring and building capacity, which will raise the level of expertise in your organization.
5. Tell me how you successfully bridged the gap between your traditional finance/accounting skill set and company operations? How have you contributed to the company strategy or mission statement?
-Rick Nunnally, CFO, Cheldan HomesLarry Winget, in his book, It’s Called Work for a Reason!, says that employees are not paid to work hard. Employees are paid for results. It’s important to know that the candidate sitting across from you in an interview has the ability to actually make a difference in your organization. In today’s market, employees need to be contributors in whatever role they are in and be responsible for value-added results. No one has the patience or the money for cubicle-fillers anymore. Candidates must be able to articulate how the organizational performance will be positively impacted as well as sell their expertise.
6. Tell me about one of your most significant accomplishments.
-Rick Nunnally, CFO, Cheldan HomesThis is a great question. With this question, not only will the candidate reveal a major accomplishment, but the interviewer will able to assess what the candidate perceives as significant.
7. Our company has a successful [accounting] team in place. How do you see yourself leading/interacting with an established group?
-Mark Gaddis, President, Dallas Door and Supply, Inc.New employees sometimes struggle with integrating into a well-functioning team. New managers or team leaders sometimes struggle with established teams the most. It is imperative that the person you are hiring be a good match for your existing team. Relationships and teamwork are crucial in any organization. Be sure to enable your team with a new employee that will be able to join in on existing success as well as bring innovative ideas to the table.
8. Describe a conflict you were involved in at work and how it was resolved. How did the work continue after that?
-Mark Gaddis, President, Dallas Door and Supply, Inc.Every employee experiences some level of conflict at some point in their career. As the candidate explains the conflict to you, you can assess their conflict-resolution skills, as well as how well they recover and move through sensitive situations.
In this economy it is more important than ever to make the right call when you are hiring. In the long run, retaining quality employees means finding the right individuals in the first place. Employee turnover takes resources away from your core business, costing up to 1.5% of the position’s annual salary. Take the time and make the effort to ask the right questions now, and you will be building a team that can affect your bottom line in this economy and the recovery to come.
