The Broken Hiring Process and How to Fix It

Hiring the right people in your startup is crucial for success.High performers can be up to an astounding 800% more productive than their average counterparts!

Such a statistic highlights the vital importance of careful and strategic hiring for the growth and sustainability of your business.

Yet, despite its critical nature, hiring often feels like navigating through a chaotic scramble, filled with costly mistakes that can have lasting negative impacts on the organization.

Each misstep in the hiring process not only depletes financial resources but also wastes precious time and energy.

In episode 11 of the podcast, I delve deeply into the current state of hiring practices. I explore why I believe the system is fundamentally broken and provide actionable recommendations to rectify these issues and streamline the hiring process for startups seeking greater efficiency and effectiveness.

The Broken State of Hiring

Survey after survey paints a stark and often grim picture of today’s recruitment landscape:

• In a comprehensive survey conducted by CareerBuilder involving 2000 hiring managers, 74% acknowledged having hired the wrong person for a position at least once, while 41% reported that such hiring mistakes had cost them over $25,000.
• Furthermore, a detailed study by Harvard Business Review revealed that 80% of employee turnover can be attributed to flawed hiring decisions, underscoring the critical need for precision in recruitment.
• Additionally, a survey by Robert Half of 1000 employees indicated that 39% would consider resigning if their manager hired someone who was a poor fit for the team, highlighting the significant impact of hiring decisions on overall team morale and cohesion.

Given these statistics, the question inevitably arises: what exactly is wrong with the recruitment process, and how can we fix it? Here are the 10 problems I see:

#1 Not Knowing When It’s the Right Time to Hire

How many times have you hired more people because you or your managers thought there was too much work to go around?

How many times have your managers come to you with doomsday scenarios where the only solution was to make a few additional hires?

Rely less on intuition and more on strategic assessments when determining the optimal timing for hiring.

Begin by mapping out your operations comprehensively, understanding your team’s current capacity, and aligning your hiring decisions with broader strategic goals of the organization.

This approach ensures efficiency in resource allocation and helps in determining when it’s genuinely necessary to expand the team.

Hiring should not simply be about filling vacant seats; it’s about ensuring that every new team member adds meaningful value and contributes to achieving the organization’s vision.

Strategic alignment can elevate the impact of each hire and support the company’s long-term objectives.

#2 Failing to Build a Solid Business Case for Each Role

How many times have you seen a hiring manager change a job description, modify the candidate profile, or switch up interviewers after the hiring process has already started?

I know I’ve seen it way more times than I can count! These are things I see a lot in companies that are never super clear on why a role exists and how it integrates into the organization.

A job description is far more than a mere list of tasks. It serves as a strategic document that defines the role’s overarching purpose and integrates it seamlessly into your company’s ecosystem.

Collaborate closely with stakeholders to articulate the role’s expected value and potential impact. This cooperation from the outset ensures alignment and clarity, creating a cohesive understanding of the role’s strategic relevance.

By meticulously outlining and communicating the role’s significance, startups can prevent role ambiguity, aligning expectations among team members and ensuring the new hire fulfills their intended function effectively.

You need to ask yourself questions like:

• Why does this position exist?
• What value does it bring to the company?
• What don’t we do today that this role will help us do?
• What is the impact on the business if we don’t fill this role?

If you can’t answer one or more of these questions, then you’re not ready to start the hiring process.

#3 No Alignment on the Ideal Candidate Profile

It’s no secret that companies hire employees based on a combination of experience, education, skills, character, and organizational culture fit.

The problem is that many companies don’t take the time to align on the ideal candidate profile before they start the hiring process and the interviews.

What you end up with is a messy evaluation process where every interviewer is using their own subjective criteria for evaluating candidates.

By clearly defining the ideal candidate profile before even advertising the position, you can streamline the often messy and convoluted evaluation process that plagues many organizations.

This alignment ensures that everyone on the hiring team shares a collective understanding of what constitutes the right fit, reducing subjectivity and improving the likelihood of selecting the perfect candidate.

A consensus on the ideal profile minimizes confusion and supports a more targeted search, ensuring efforts are focused on candidates who genuinely meet the role’s requirements and align with the company’s culture and values.

#4 Using an Unstructured Interview Process

For your hiring process to be effective, it needs to be consistent from start to finish, every single time.

This applies to the number of interviews in your process as well as the types of questions you ask during interviews.

The biggest issue with unstructured interviews is the questions that interviewers ask.

How many times have you gone through a hiring process and felt that several of the interviews were similar because the questions were relatively the same?

How many times have you interviewed with someone who you felt didn’t know enough about the job or seemed like they were winging it with questions based on what came to their mind at the time?

How many times have you been asked questions that have nothing to do with your ability to do the job?

These are all signs of an unstructured interview process.

Every interview in your process must have a clearly defined purpose. If it doesn’t, then you need to question why it exists.

There’s no point in wasting your team and the candidate’s time with interviews that add no value to the decision making process.

Each interviewer should prepare a set of questions that they ask each candidate.

If you ask candidates completely different questions, then you’re not evaluating based on the same criteria.

#5 Choosing Interviewers That Add No Value

Sometimes it feels like companies treat interviewing like a block party!

Anyone who wishes to participate is invited. Interviewers should be hand-picked based on the job role you are trying to fill.

It is vital to recognize that not everyone needs to be part of the interview process.

Select interviewers who can offer valuable insights into the candidate’s suitability for the role, ensuring their expertise aligns with the role’s requirements.

Avoid succumbing to the “consensus by committee” mentality, which can dilute the hiring process with unnecessary opinions and lead to bad hires.

A targeted and well-informed panel can make more strategic decisions that align with the organization’s hiring goals.

#6 Not Documenting Interview Feedback

Robust documentation of interview feedback is an essential aspect of the hiring process.

Detailed records not only support informed decision-making but also provide crucial protection for your startup from potential legal challenges.

Committing to this level of documentation is about creating a transparent and defensible hiring process, where decisions can be traced back to logical and coherent justifications, ensuring accountability and clarity at every step.

#7 Not Testing Core Skills

A resume alone cannot adequately demonstrate whether a candidate possesses the core skills necessary to perform the job effectively.

Implementing practical skill assessments and projects that mirror real-world tasks is critical, especially for roles where specific competencies are non-negotiable.

This proactive approach allows for a genuine evaluation of a candidate’s abilities, ensuring they can perform the tasks required and possess the requisite skill set to contribute meaningfully to the organization’s success.

#8 Lack of Transparency About Job Expectations

I’m sure you’ve had experiences where the employer sugar-coated the job, made it sound like a dream opportunity filled with sunshine and rainbows, and sold you on an amazing company culture, only for you to find out that it was nothing more than smoke and mirrors.

The era of sugar-coating roles is over. It is imperative, to be honest about what candidates can expect from the position, both in terms of responsibilities and the work environment.

20% to 30% of employees leave their jobs within the first 90 days, and it’s mostly because of role misalignment or a company culture mismatch, things that can be avoided when employers are more transparent during the hiring process.

Such transparency helps align expectations, reducing the likelihood of turnover due to misaligned job experiences and ensuring that candidates who accept the role do so with a clear understanding of what awaits them.

#9 Revealing Compensation in the Job Offer Stage

Discussing compensation upfront serves to prevent mismatched expectations down the line.

Transparency about financial expectations saves time for both parties, ensuring candidates and companies are aligned financially from the beginning.

This upfront clarity helps avoid any potential misunderstandings about compensation, fostering trust and transparency in the hiring process.

#10 Cut Corners Due to Urgency

In the fast-paced world of startups, urgency might tempt you to rush the hiring process.

However, maintaining a disciplined approach and adhering to your established process is vital to ensuring consistency and quality in your hiring decisions.

All candidates must go through the same process. It doesn’t matter if they are a referral, an online candidate, or your best friend from high school. Make no exceptions.

If hiring managers come to you asking to fast-track a candidate, simply point them back to your hiring process and remind them why it exists and explain the potential issues that could arise from cutting corners.

Remember, the right hire today is an investment in the company’s future stability and growth; it can avoid costly turnovers or lay-offs in the future.

Prioritizing thoroughness and strategic thinking in your hiring practices are essential for sustained success.

What’s Coming Next?

In the next episode, I’ll talk about how you can quickly identify candidates who are a bad fit for the startup world.