Are those new Finance hires paying off?

More than half of employers don’t measure the ROI of a new hire – and it’s costing them big.

We’ve said before that letting an employee go in some cases can be very costly, but that assumes employers are actually measuring the return on investment with their hires. As it turns out, 56% of employers don’t measure a new hire’s ROI, according to an ACT Bridge report. And for those that do measure it, the numbers are still a bit disconcerting:

• 42% measure the ROI of education and training programs
• 32% measure the ROIof HR information management tools and resources, and
• 25% or less measure the ROI of recruiting firms, job boards, social media sites and other recruiting efforts.

It would appear that a good chunk of employers surveyed are mainly concerned with getting the hire in the door. But without properly analyzing a new hire’s return after a certain period of time, you could be ignoring a significant money drain due to a weak hiring process.

Hiring mistakes to avoid

There are different software solutions out there aimed at helping departments calculate the necessary info to track the return on your talent investments.

There are also some free ways to get back on the right path. Pass these along to HR and hiring managers and plan to get proactive on avoiding these at all costs.

1. Ignoring employee referrals: If you’re not actively looking for referrals from your own staffers, now’s the time to start. Referrals tend to last twice as long, have a motivation to perform better (after all, they’re working with someone who vouched for them), and are more likely to have a better understanding of the company culture before the initial interview.
2. Relying on job boards and career sites: Your best employee won’t likely come from a job board and won’t invest 45 minutes of their time to fill out a profile on a career website. And if your company’s career site requires applicants to jump through a lot of hoops, not unlike what they’ll experience at a career website, then forget about it: You could be losing some of the best candidates.
3. Ignoring social media: Social media can be an extremely effective way to connect job prospects with companies they’re interested in. Tweeting or a posting a job opportunity on Facebook is easy to do and will open you up to a lot more opportunities.
4. Valuing direct experience first and foremost: Obviously you want a candidate that meets your qualifications. But all too often, companies use experience as a pass/fail test when picking out prospects. Some would argue that it’s worth picking a candidate with less experience but a clearly better fit in the company culture. Again, referrals are absolutely essential when finding like-minded employees that’ll best fit the culture.

Any hiring tips? Let us know yours in the comments below.