How to improve quality of hire at your company

Quality of hire
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Did you know top-performing employees generate 400 percent more output than your average employee? That’s a feel-good statistic but it’s accompanied by one you won’t like as much— one in five high-performing employees will likely leave the company in the next six months. In order to be prepared for turnover, it’s important to continuously work to improve your quality of hire.

Often, an employee leaving is just a natural cycle for high-performers who are leaving the company to take a different opportunity and there isn’t much you can do to prevent it. Sure, you can (and will) work on your employee experience, onboarding process, and developmental programs to keep the employees happy and in your company, but that won’t completely solve the problem of high-performers leaving. 

But there is something you can do to prepare for the departure of our best employees and that’s finding new talent that will perform at a high level. 

That leads us to a term you need to understand if you’re prioritizing the hiring of high-performing individuals—quality of hire.

Quality of hire quote

What is quality of hire?

Quality of hire refers to the contribution a new hire adds to the company. In other words, it’s about quantifying the value a new employee will create once onboarded. That is usually measured through one of the following: 

  • the company’s long-term success

  • the employee’s performance

  • the employee’s productivity

  • the employee’s support of their coworkers

A high-quality hire will have a positive impact on the company’s long-term performance by contributing to the culture, status, brand, and financial success. High-quality employees will excel in their duties and their productivity will be among the best in the company. Additionally, through their social, intellectual, and emotional intelligence, they will have a positive effect on the people who work with them.

It is often the case that an entry-level hire with a strong work ethic and a good attitude can contribute more than an average C-suite executive.

But there’s one problem with hiring for quality. Quality is by definition a qualitative metric, meaning it is data “that approximates and characterizes.” It can be difficult to quantify qualitative results because they don’t have associated concrete metrics. 

Instead, you will have to track metrics like turnover, performance, promotions, and engagement, which means that it takes a longer period of time to assess quality of hire.

So, yes, it’s a more involved process, but it’s not impossible! Before we delve into how you can assess and improve your quality of hire, let’s talk about the specifics of why it’s so important. 

Why is quality of hire important?

Workforce Logiq presented alarming data on employee retention rates. Employee volatility has increased by 8% among Fortune 100—the average across the Fortune 100 is 50.89%. It’s never been more important to focus on continuously recruiting top talent. 

Quality of hire quote

It’s like the adage recounting a conversation between a CEO and CFO: 

The CFO asks, “What if we invest in people and they leave?And the CEO responds, “What if we don’t and they stay?”

Quality of hire is the first step in investing in people that will pay dividends down the line. You start by measuring what matters and to do that, use the following metrics.  

How to measure quality of hire

Even though you can’t measure quality of hire directly, there are metrics you can use to get an idea of where you stand and to work on improving.

Most companies use the following three metrics as a proxy for measuring quality of hire:  

  • performance metrics

  • turnover and retention metrics

  • hiring manager satisfaction metrics

The higher your employees score on hiring manager satisfaction and performance metrics, higher your quality of hire. The better you’re able to retain top employees, the longer you’ll get the benefit of their contribution, and the higher they’ll be able to perform as they learn more about their role and develop professionally.

Some other HR metrics that can help out as proxies for measuring quality of hire are: 

  • cost per hire

  • recruiting yield metrics

  • time to fill

  • source of hire 

  • offer acceptance rate

  • 360 degrees assessments

  • hiring manager, customer, and peer surveys

But measuring quality of hire isn’t enough. You’ll want to actively work to improve your quality of hire as well. In 2019, 42 million workers in the US voluntarily left their jobs. That’s more than 27 percent of the total US workforce!

Measuring quality of hire allows you to assess your current situation. But actively working to retain top talent and increase the quality of hire requires an understanding of how to improve your hiring process.

How to improve quality of hire

To improve quality of hire, there are two important areas to focus on. 

The first is your pre-hiring process. The second is your post-hiring process. 

Improve your pre-hiring process to increase quality of hire

In the pre-hiring process, use tools like:

  • talent scorecards, which provide a structured format for your hiring team to use as they assess candidates.

  • assessments, which provide insight as to a candidate’s skills, alignment with your company’s values, and personality.

  • Realistic Job Previews (RJP), which give a candidate a better idea of what to expect in the role—the good and the bad.

You might consider creating RJPs and scorecards internally, but pre-employment assessment tests typically require some outside help. That’s because they’ll require the assistance of a subject-matter expert to create questions that will predict on the job success, and you’ll also need a platform through which to administer the test.

At TestGorilla, we offer over 120 tests created by subject-matter experts to help you identify the best candidates and increase your quality of hire. You can take a look at our Test Library to review our:

Improve your post-hiring process to increase quality of hire

The second area where you can improve quality of hire is the post-hiring process. 

In the post-hiring process, you can do things like: 

  • improve the employee experience. This is where, according to Linkedin’s 2020 Global Talent Trends, 77% of companies focus their activities. Most companies recognize the need to improve the employee experience to increase retention rates and create satisfying work environments. 

  • build an effective onboarding process. The faster an employee can be brought up to speed and begin making a contribution, the more satisfied they’ll be and the more they can contribute.

  • create a coaching program for your managers. Each of your managers can be a great resource to help you retain top talent and to aid your employees in their professional development so that they can make increasingly meaningful contributions to the company.

  • motivate new hires. It’s important that each new hire is excited about their job and looks forward to starting work each day.

It will always take time to increase the number of high-performing employees. Your company culture, employee experience, and coaching all play a role in the process.

Start with the best ingredients if you want to cook up a successful company

High-performing employees always start as new talent that you need to nurture so that they can grow into high-performing individuals. But to have those star employees, you need to start by measuring quality of hire and being intentional about finding talented individuals who want to grow.

Your employees are the not-so-secret ingredient in your recipe for a successful company. Make sure you’re only using the best ingredients by using skills tests at the top of the hiring funnel, and optimize your pre- and post-hiring processes to ensure that everything comes out right in the end.

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