Did you see Simon Swans article in the latest edition of Management Today*? Simon talks about the importance of interviewing and quotes Harvard University research that says that new hire failure costs can amount to five times salary. I thought the costs understated and suspect that Simon’s probably taken a fixed cost of salary and direct expenses but not included the lost opportunity costs that result from a new hire failure.

At this point you probably might discount my own research as being inflated, if I included it here, so let me point to Brad Smart’s book “Topgrading” ,as evidence, where he wrote that his research into new hire failure could amount to 24 times the salary. Much of these come from lost opportunities which, depending upon position, include lost sales, projects not met and so on

I thought it interesting that Simon’s solutions to the problem was to ensure that the Resume (CV) was accurate and that the interview process robust. All good stuff. However, a crucial part of the process is the six months that a company spends integrating the individual into the new job. 

* 5th August 2011

This entry was posted on Wednesday, August 10th, 2011 at 10:30 am and is filed under Recruitment, Talent Management.