The official definition of Quality of Hire (QoH) is a new hire who adds value to a company and contributes to the organization's long-term success, but what does it really mean? It is tempting to measure quality primarily in terms of education level and specific skills, but stopping there can lead to poor hiring decisions. Quality of Hire means more than just hiring someone who has the education and skills. It is hiring someone who meshes with the organization's culture, wants a career with the company, strives to collaborate with others and is always looking for ways to improve.
You need A+ results from your hiring process. Our Quality of Hire Report Card will show you how to get there.
Thinking Beyond Skills
Hiring people with the appropriate skills, or who have the ability to learn the required skills, is important. However, what happens when the person is technically skilled but has poor communication skills, has difficulty collaborating, lacks motivation to improve or is not a good fit for the organization's culture? The answer is the new-hire:
- Brings specific skills for specific tasks to the job, but value creation stops there
- Is not likely to stay with the company beyond a year
- Exhibits productivity on the low end of the scale
- Seldom volunteers for stretch assignments
- Rarely presents innovative ideas
- Finds little personal satisfaction in the work completed
- Never internalizes the company's values
Recruiting company Glassdoor reported 50 statistics on recruiting and hiring, and one statistic presented said that organizations investing in a strong candidate experience will experience a 70 percent improvement in Quality of Hires. An oft-quoted LinkedIn survey found that Quality of Hire was a top performance KPI for 39 percent of global talent leaders surveyed. A strong candidate experience is one in which a talent assessment considers the whole person – skills, potential, abilities, cultural fit and personality.
Measuring Success in Attracting, Hiring, and Retaining Quality
Once again, a Quality of Hire is someone who is skilled and motivated to create value that contributes to their company's long-term success. There are numerous KPI formulas used to measure Quality of Hire, but the most important point is that measuring is crucial to the Quality of Hire.
Calculations include factors like retention rate, but they also take into account factors like cultural fit, success of the onboarding process, engagement, job productivity, time to reach full productivity, management satisfaction with the employee and any other factor the company considers important. The KPI informs you as to whether:
- There is a good pipeline of quality job candidates
- Good hiring decisions are being made
- How well the hiring process is meeting goals
- How well the evaluation process for job candidates is performing
The Quality of Hire measure is fairly complex because assessing a person's quality is a combination of measuring objective and subjective factors. For example, retention rates are unbiased factors based on the facts. Management satisfaction with a new-hire has some subjective elements. Productivity may be high, but what if the manager and the new-hire have personality conflicts?
Objectivity and Thoroughness
Here is the bottom line on Quality of Hire:
Being as objective and as thorough as possible in the pre-hire measurement process is crucial to attracting, hiring and retaining top quality people.
Pre-hire assessments offer both objectivity and thoroughness, significantly increasing the odds of hiring top performers. The assessments can assess specific skills, leadership potential, motivation, personality traits and emotional intelligence. They give a holistic picture of the potential hire, making it much more likely the person hired will be a Quality of Hire and post-hire Quality of Hire KPIs will improve.
Numerous studies over the last five years have found that hiring managers who are allowed unfettered discretion to override testing results are more likely to hire people who are not the best fit and are more likely to become a turnover statistic. The former Chief Talent Officer at Netflix, Patty McCord, shared her thoughts on how to hire the best people.
One thing she points out is that hiring managers, left to their own devices, naturally want to hire "someone just like me." What the company ends up with, unless the cycle is broken, is a group of people who think and act alike. They are not Quality of Hires because the potential value of creativity and innovation, only achievable through diverse perspectives, is never created.
Hiring the Whole Person
To find the best people, use a variety of pre-hire assessments – skills assessments, personality tests, abilities assessments, motivation assessments and job simulations. Pre-hire assessments have high predictive validity, and that is precisely what you need to improve Quality of Hire. People are whole beings, so hiring based on the whole person only makes sense.