Avoid a bad hire: Consider the “fit”

The destructive effects of a poor hiring decision cause Mick Armstrong, CPA, CGMA, to focus on two qualities in job candidates.

It is important that new employees be technically proficient and organised so that their co-workers won’t have to do more than their share of work and grow resentful, said Armstrong, the CFO of Micro Tool 100, a manufacturer in Meridian, Idaho.

But it’s just as important that the worker being hired fit in with his or her co-workers.

Coaches of athletes will tell you that a team’s performance suffers when a star athlete poisons the locker room because he or she can’t get along with teammates. The same is true in business. A poor hiring decision can have effects that extend beyond the underperformance of the individual employee, a new survey shows.

CFOs overwhelmingly said a poor hiring decision affects the morale of their team in a survey developed by professional staffing services firm Robert Half. More than 1,400 US CFOs participated in the survey. Thirty-five per cent said a poor hire greatly affects morale, and 60% said morale is somewhat affected by a poor hire. Just 5% said a poor hire has no effect on the team.

“The very most important aspect of [hiring] is the fit of the individual in the organisation and establishing a good team working environment, a collaborative type individual,” Armstrong said.

An individual who can’t collaborate – or isn’t productive enough – can consume a significant chunk of managers’ valuable time – in addition to destroying morale.

CFOs were asked what percentage of a manager’s time is spent coaching and supervising poorly performing employees. The mean response was 17% – nearly a full day each week that managers spend pushing low performers to do better.

Robert Half identifies five actions to take when hiring:

• Don’t go it alone. Ask colleagues for their thoughts on needed attributes and competencies for the new employee.
• Use your contacts. Reach out to your network and recruiting sources, and don’t rely strictly on online tools.
• Move quickly. Once you identify your top candidate, extend an offer – or risk losing a good candidate to other opportunities.
• Offer competitive compensation. Don’t offer a compensation package below the market standard.
• Hire the best match. Identify skills that are necessary and skills that can be developed, and hire the person who fits the job and work environment.

Armstrong said employees who don’t fit in well end up being isolated, and that can be a big problem for the team. He said teamwork helps create the efficiency that businesses crave, both on the manufacturing floor and in the office.

“It’s good to have people be able to work together and say, ‘I’ll finish this up for you, and you can finish what you’re doing,’ ” Armstrong said. “And if you don’t have that, you’re just not as productive.”

—Ken Tysiac (ktysiac@aicpa.org) is a CGMA Magazine senior editor.