Do you know the expression, “One bad apple can spoil the whole bunch?” When it comes to a bad hire, one wrong person in an organization can cause financial and cultural turmoil in a business. If the bad hire leaves the company, you can’t breathe a sigh of relief; the former employee could give you a bad rating on a career site that harms your future recruiting efforts.
Here are a few of the negative consequences that can come from a bad hire.
A Bad Hire is Bad for Business
A decline in productivity is just one of the negative impacts of a bad hire. If the new employee doesn’t have the skills to do the job (or do it well), it can spill to the rest of a team. The other members of the team may need to work harder to pick up the slack from the bad hire. They may feel resentful and morale could decline. A bad hire could even drive members of the team to find another job, taking their skills and organizational knowledge away—maybe right into the arms of the competition.
A bad hire can also create problems in workplace culture. If the bad hire is disruptive, negative, or doesn’t add value to a team, this disrupts the entire workforce they come in contact with. This can create cracks in corporate culture; employers must counteract any issues that arise with the team as well as dealing with the worker that isn’t the right fit.
The external damage of a bad hire can include wrecked client relationships. A bad hire can even cause you to lose customers. Rebuilding these relationships is difficult and time-consuming; once trust is broken it’s hard to get back. This makes hiring the right people imperative because of the damage that an employee representing your business can do.
When a company’s reputation is damaged, that can affect your ability to hire new employees. Reputation matters, so if you hire the wrong people, it can create a rift with current and future employees, who may question management’s decision-making abilities and leadership skills.
Last, but certainly not least, is the financial impact of every bad hire. Studies show the cost of each bad hire is somewhere between $25,000 to $50,000 per employee. The financial costs encompass recruiting, orientation, background checks, training, and much more. Replacing the bad hire tacks on even more costs.
Note that it may take some time to determine that the employee isn’t a fit. What kind of damage can the bad hire do while you’re trying to figure things out? The best defense against a bad hire is to hire right every time.
How to Ensure You Hire Right, Every Time
All of this leads to the almost inevitable question of how can you avoid a bad hire? Investigate every new hire with a background check and references. Pre-employment testing can also help determine the fit.
During this process, it’s important to partner with an experienced team to ensure the fit of the candidates you’re interviewing. Talk to Blackstone. We have an excellent track record of finding the right new employees for our clients and can help take the risk from the hiring process.