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Month: August 2015

The Importance of Recruitment

Currently I’m highly involved in shaping the recruitment process in my company. To be frank, before joining Ocado Technology I didn’t realise the importance of this process. I treated recruitment as something that stands in the way of my work. But I was wrong. Now I believe that recruitment is one of the most important things a company should be focused on.

“Work Rules!” by Laszlo Bock changed my perspective dramatically. The book is about how Google’s People Operations (it’s basically Human Resources on steroids) work and why. This book changed my view on importance of HR, especially recruitment. Let me share my arguments for why you should also care about hiring.

The High Cost of a Bad Hire

There are costs related to a bad hiring decision. Some of these costs are relatively easy to measure, like sourcing, interview time or salary that was paid during the tenure. But there are also other, hidden costs that are hard or impossible to estimate:

  • Decreased morale in affected team. A low performer may negatively influence people around him/her. Subsequently firing them may cause a further nosedive in morale. Sometimes, however, it may have a positive impact – the team may be grateful that the constraint has been removed.
  • Negative effect on productivity. I have experienced situations where a team member’s code quality was so poor that the rest of the team felt it necessary to replace their code. Naturally, the team then became more productive once that person had been released.
  • Opportunity cost. What would it look like if we hired an “A player” instead? Where would we be?

Some organisations have tried to estimate the financial cost of a bad hire, taking into account all the above factors. $250k, £335k or even $884k are examples of their findings. It is probably different in your case, but it’s essential to realise that the costs may be higher than you think. Continue reading The Importance of Recruitment

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