Diving into Quality of Hire: Understanding and decoding this mystery metric
What Is Quality of Hire and Why Does It Matter?
When seeking talent for your organization, it is critical to find employees who will add value to your company in the long term. While the traditional interview and background check offer some insight into individual applicants, it is still all too easy to select the wrong talent for your company. This can result in an ongoing cycle of short-term hires who either resign or are terminated, leaving you with an urgent need to fill positions on a regular basis. Not only is it time-consuming, but hiring a new employee is also expensive. In fact, the cost of hiring a new employee can easily reach thousands of dollars within the first few months.
Thanks to modern technology, hiring managers and recruiters are gaining a more accurate snapshot of the key performance indicators (KPIs) that can predict a quality candidate. Quality of hire is one of the most critical KPI metrics for recruiting and selecting ideal candidates for each position.
What Does Quality of Hire Mean?
Quality of hire is the value that a new employee contributes to the overall success of your company in the long term. Considering the cost of hiring and training a new employee, it is no surprise that identifying quality hires is increasingly a priority for recruitment strategies. What is surprising is that so few companies use these metrics to determine whether their employees are creating value.
Employers' hesitance to use new hire value data in their recruitment and hiring strategies isn't for lack of interest. Most business owners understand the value of a good employee for the success of their company, but employers aren't sure how to establish reliable candidate ranking metrics and translate that information into a successful strategy. This is largely because, unlike cost of hire and time to fill metrics, quality of hire metrics are more unclear, and cannot be measured accurately in the short term.
Fortunately, a range of data-driven platforms like Crosschq are engineered to simplify your hiring process and improve your quality hires through detailed digital reference checks, dynamic recruitment, and improved data analytics.
What are Quality of Hire Metrics?
According to LinkedIn, Quality of Hire metrics are one of the top five hiring metrics companies should be using to capture top talent in 2021. These metrics refer specifically to the quantifiable aspects of recruitment and hiring that reflect the value of employees to the company in the long term.
The most common metrics include:
Although ranking hires relies heavily on employee performance, hiring manager satisfaction, and new hire fit, there are a number of other metrics that may be taken into consideration.
By tailoring these metrics to target the particular needs of your operation and the role in question, you can ensure that you have the most complete and accurate information needed to hire the most suitable applicants and retain key employees. The first step is to create a quality of hire index, as a reference point from which to calculate your success in improving quality hires.
How Do You Calculate Quality of Hire?
Calculating the quality of hire of an individual during the hiring and training process is different from calculating it for your organization as a whole. However, both individual and company values are linked and offer unique and necessary insights for improving your hiring and recruitment strategies.
The fundamental calculation is:
Employee performance
The value for employee performance can be calculated using several factors, including:
By calculating the average of all factors on a constant rating scale, say 1 to 10, you can reliably measure the quality of individual new hires and their performance. You can also calculate the average of these scores among all of your new employees to establish your overall quality value for new hires.
Hiring manager satisfaction
While it can be tempting to focus on individual new hires, your hiring manager's satisfaction plays a critical role in your company's quality of hire. Using periodic internal surveys, you can garner valuable information about the recruitment and hiring process. With a tailored hiring manager satisfaction survey, you can gauge:
This information is crucial to ensure continuous improvement of your recruitment process.
New hire fit
Choosing the right person for your organization is more than just measuring their performance, it is ensuring that they fit into the company seamlessly. When determining your new hire's fit within the company, consider the following:
Overall Quality of Hire for recruitment process
Using individual scores from your new hires, hiring manager satisfaction surveys, and employee retention numbers, you can calculate the overall success of your recruitment process. By parsing the information based on recruitment tactics or specific timeframes, you can calculate the quality of hire for specific recruitment methods. In short, real-time data, such as what Crosschq can provide, for employee performance, retention, and manager satisfaction allows you to continuously refine your recruitment process and improve your quality hires.
What are Quality of Hire Benchmarks?
These benchmarks refer to the ratings systems and indexes you put in place to evaluate your new hires. These benchmarks can include everything from employee goals and performance to manager satisfaction and company culture.
When this performance data is taken from multiple employees over the course of several months or years, you gain a more complete picture of the recruitment process. This quantified data allows you to adjust your recruitment and hiring strategies to reduce turnover, enhance employee engagement, and ultimately hire and retain the right talent for each position.
With a focus on quality hires, your organization is more likely to recruit top performers who will contribute significantly more to your company's overall productivity. By tracking the performance and contributions of your new hires, you can see which employees become top performers and tailor your recruitment accordingly.
How Do You Improve Quality of Hire?
Making improvements is a long-term goal that can take months or even years. Unlike more traditional hiring processes that focus on resumes and interviews, quality of hire processes focuses on improving your overall recruitment and hiring strategy. Ultimately, the goal is to ensure that the employees you hire are creating more value for the organization than they are earning. This means collecting both pre-hire and post-hire data, keeping your hiring workflow organized, and establishing common goals for your hiring managers.
Pre-hire and post-hire data collection
Your recruitment strategy should incorporate pre-hire data such as:
Post-hire data is equally critical and includes:
Organizing hiring and recruitment workflow
Workload organization for your recruiters and hiring managers can help to streamline the process and enhance the productivity and efficiency of your recruitment activities. A streamlined workflow allows for quicker candidate selection by:
Establishing common goals
Improving your quality of hire means having all of your hiring managers on the same page when it comes to hiring and recruitment goals. Communication is key to establishing common goals, which in turn allow you to streamline operations for a faster, more efficient hiring process. Keep your hiring managers aligned with:
Partner with Crosschq to Enhance Your Quality of Hire
From pre-hire to post-hire improve and measure your quality of hire with Crosschq. Crosschq 360 talent acquisition software, Recruit candidate referral network, and data-driven Analytics will all help you establish a winning recruitment strategy.
To learn more about Crosschq, contact us to schedule a personalized demo.
The Dangers of Downsizing Without Considering Quality of Hire
It seems like you everywhere you turn you can’t escape hearing the unfortunate news of another company layoff. Recently Meta laid off 13% of its staff, equating to11,000 workers.
Whether it’s downsizing, layoffs, reduction in force, or workforce optimization - these are all terms used when a company has more workers than they need or can afford.
Before people are let go, however, there are important questions that need to be addressed:
Answering these questions before employees learn of intended layoffs is critical. Plans for downsizing or force reduction should always be planned down to the last detail, to avoid losing top talent and destroying the public perception of the organization.
The Pitfalls of Last-In, First-Out Layoff Practices
Outdated last-in, first-out methods lead to disastrous downsizing decisions for Quality of Hire.
Recent research from Crosschq Data Labs discovered, after running a scenario using Crosschq Analytics that using “Last-in, First-out” methods for downsizing, companies could (and did) lose some of their top performers.
Obviously, tenure can’t be trusted as the main indicator of Quality of Hire. In this case, it was revealed that:
Because performance data wasn’t used in the decision-making surrounding the layoffs, and tenure was used solely as the deciding factor, the Quality of Hire of employees terminated was 15% higher than those retained.
Using the wrong methods or metrics to determine whom to let go can result in the exit of key performers from an organization. It’s time to let go of the idea that tenure is the all-important factor in deciding an employee's value to an organization.
Why Tenure Bias Is Dangerous
Because of tenure bias when selecting employees to dismiss, companies can (and do) lose some of their top potential performers. Bad termination and retention decisions can directly affect remaining workers, and negatively impact the likelihood of producing the business outcomes desired.
Loss of knowledge
Using the wrong methods or metrics to determine whom to let go can result in the exit of key performers from an organization, and with them goes the accumulated knowledge they have built during their time in the company, even if that time was short.
Reduced productivity
A whopping 60% of the cost of turnover is lost productivity. Productivity reduces by around 30% across employees forced to cover work not being done by a departed employee. With so many employees overworked and under-rewarded, sick calls go up, leading to even more losses in productivity.
Damaged morale
When employees see high-value employees let go simply because they haven't been around that long, their worries over their own jobs and outrage on behalf of their high-performing ex-coworkers can spill out in the form of discontent and demotivation.
Increased voluntary turnover
A recent study shows that just a 1% force reduction due to a layoff can cause a 31% decrease in workforce due to voluntary turnover. This can include high-value employees whose loss can seriously damage business outcomes.
Combating the Risks of Workforce Reduction
Employers can minimize the adverse effects of layoffs by following a clear, data-driven strategy for maintaining productivity, retaining key employees, and keeping up a good relationship with workers who are being terminated.
Leverage Quality of Hire data to make objective layoff decisions
Businesses simply can’t afford to make subjective decisions when it comes to a reduction in force: instead, Quality of Hire should always be the deciding factor. This will help maintain productivity levels and deliver positive business outcomes.
Using post-hire Quality of Hire data via Crosschq Analytics to review performance history, track engagement metrics, and assess culture add before downsizing can prevent the loss of employees who have historically contributed the most to organizational performance.
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Provide resources for employees being terminated so they land softly
Making sure employees who are being terminated have somewhere to go can go a long way toward building company loyalty and trust. In one study, companies that provided outplacement support for laid-off employees received 43% better employee opinion ratings than ones that did not.
Crosschq Assist offers downsized employees the opportunity to opt directly into Crosschq’s sourcing database, a talent pool preferred by many employers. This connects them with recruiters for more than 1,500 hiring organizations, providing them with a potential fast-track path to a new position.
Take the opportunity to optimize the workforce
Some employees may choose to leave even when the organization would benefit more from their staying. Other employees will exit and their loss won’t be so keenly felt - except that now there may be more empty seats than is sustainable.
This is the ideal time to optimize the workforce. Identify current and potential future skills gaps within the company, and figure out if empty roles can be consolidated for greater efficiency. Redefine job responsibilities and create new roles if needed to meet anticipated needs.
Then use a talent pool like Crosschq Recruit to quickly find candidates who have strong Quality of Hire potential, and fill those empty seats with employees that don’t just help the company meet business expectations, but provide the foundation for a future-proofed workforce.
Learn how to measure and predict Quality of Hire
Downsizing also provides the ideal opportunity to reimagine your company’s workforce as a Quality of Hire powerhouse. Crosschq has developed a Quality of Hire scorecard to help organizations analyze outgoing and incoming employees' performance and assign Quality of Hire scores.
This data can be used to build profiles of ideal employees, which can then be leveraged in future recruitment efforts when the company is ready to expand again. By investing in Quality of Hire as a key metric affecting business outcomes, organizations raise the bar for productivity and revenue building.
To learn more about how Crosschq can identify employees in the workforce with the highest Quality of Hire scores, contact us for a demonstration today.
Unlocking the Mystery around Quality of Hire
The metric everyone is talking about is Quality of Hire. If your organization isn’t recruiting with Quality of Hire as a priority, you’re missing out on chances to land great candidates and could be hiring less-than-stellar employees who bring your whole business down.
Unfortunately, many employers don’t understand what Quality of Hire is much less how to measure it. It’s a complete mystery - one that it’s high time everyone is able to unlock.
Quality of Hire: the Basics
Understanding what Quality of Hire represents is easy. Simply put, it’s the value an employee brings to an organization in regard to business outcomes.
The exact parameters used to define Quality of Hire may vary slightly from organization to organization, but the bottom line is that if the more an employee helps drive an organization towards its goals, the better their overall Quality of Hire will be.
Measuring Quality of Hire is a lot harder than defining it. The key is to identify key metrics that impact Quality of Hire, and then set up a scoring system that allows each metric to be ranked on a similar scale.
The score can be compared against that of other employees’, and also compared back to the same worker’s score at different points in time.
Benefits of Quality of Hire
Although 58% of respondents to one survey said they don’t even look at Quality of Hire until an employee’s 90-day mark, starting as soon as an applicant hits the recruitment funnel is critical. Proactive, predictive pre-hire assessment and estimation of a candidate's Quality of Hire can yield valuable data when matched against post-hire analysis.
Tracking Quality of Hire over a new hire’s first year can help you identify which employees are meeting expectations and which are falling short, and provide opportunities to redirect, retrain, or release an employee.
When Quality of Hire is used in this matter, employee performance and productivity improves. Great employees can be rewarded, good employees can be guided to greatness, and bad hires can simply be let go to be replaced with a better fit.
Research shows that high-performing employees can achieve up to 400 times the productivity of low-performing employees. Isn’t that reason enough on its own to pursue better Quality of Hire? Now that you have the tools to unlock the power of Quality of Hire, there’s no reason not to start leveraging this metric in every hiring and firing decision you make.
Unlocking Quality of Hire With Crosschq
Crosschq Analytics is designed to help you measure Quality of Hire across your organization, helping you quantify the value of your employees. It pulls data that speaks to Quality of Hire without bias, helping you build a clear picture of your employee's strengths and weaknesses.
Crosschq has also developed a useful Quality of Hire Scorecard to help you obtain an accurate snapshot of how any hire is doing at any point in time. Simply plug in each ranking, and use the formula to arrive at a Quality of Hire score.
You can then create a spreadsheet and track every long-term employee and new hire’s Quality of Hire scores over time, creating a clearer picture of what their real value to the company is, and how you can leverage it for even greater results.
Quality of Hire doesn’t have to be a mystery. Contact Crosschq for a demonstration today.
5 Reasons Why Quality of Hire Is SO Important
Question: Why is Quality of Hire what every recruiter and hiring manager is talking about?
Answer: Because Quality of Hire can help turn workforces into powerhouses of performance.
Quality of Hire has become the priority for recruitment professionals in every industry. Understanding why Quality of Hire is so important can help you make better hiring decisions. It’s time to discover the multiple reasons behind the recruitment industry’s obsession with this all-important metric.
What IS Quality of Hire
At its core, Quality of Hire is a measurement of how valuable an employee is to your organization. Quality of hire is usually expressed as a score or percentage. Your employee’s Quality of Hire scores can be tracked over time to measure improvement, and compared against each other to identify high and low-performing employees.
By looking at the scores of existing employees, you can build profiles that correlate with high performers who have good Quality of Hire scores, and begin predicting how candidates in your hiring funnel might perform. You can use Crosschq’s Quality of Hire Scorecard to accurately measure your employees’ scores.
5 Reasons Why Quality of Hire Is SO Important
Quality of hire can have a significant impact on business outcomes. Here are five reasons why Quality of Hire is critical if you want your organization to thrive:
#1: Increased Productivity
Quality of Hire is measured based in large part on performance and engagement. Employees who are high-performers can deliver up to 400x as much productivity as employees who perform poorly, indulge in presenteeism, or are unengaged and unmotivated.
#2: Improved Retention
Quality of Hire also depends heavily on whether or not the employee is a good fit for the job values and company culture. Employees who feel like they fit with their team are more likely to stay with an organization long-term than those who don’t put in an effort to build interpersonal professional relationships.
#3: Reduced Costs
Quality of Hire leading to improved retention reduces direct recruitment costs by limiting employee turnover and eliminating the need to constantly refill empty seats. Hiring high-performing talent also reduces the costs related to losses in productivity associated with low performance.
#4: Enhanced Morale
When half of your employees are high performing and the rest are low performing, bringing in yet another mediocre employee drags down morale. Your top talent knows they are carrying the bulk of the load, and maybe resentful or even decide to quit. Recruiting for Quality of Hire is one of the best things you can do to help create a positive company culture.
#5: Maximized Revenues
According to one report, just a 10% increase in employee productivity could result in up to a 100% increase in pre-tax income. Making hiring decisions based on Quality of Hire can improve your company’s bottom line.
It’s time to stop asking “Why?” and start making Quality of Hire a cornerstone of your recruitment strategy. To learn how Crosschq can help, Contact us for a demonstration today.
Why New Hires Leave: The Importance of Quality of Hire in Recruitment
One in five new hires quit within 45 days of starting a new role, and this percentage jumps to one in three by the six-month mark after hire. Why do new hires leave, how can you stop them, and is Quality of Hire a factor?
While the cost of having to replace a new hire can be significant, the cost of keeping a bad hire around can be even higher. Dealing with the often complex issues surrounding new hire churn often requires learning to understand, measure, and predict Quality of Hire.
The Connection Between Quality of Hire and Employee Retention
If you’re not specifically recruiting for Quality of Hire, you can expect the average tenure of an employee at your company to be low - and the value each employee brings to your organization will be hit or miss.
By making Quality of Hire a priority in your recruitment process, you can both improve business outcomes and increase the longevity of your hires. Improved retention means greater knowledge being built and kept within your company, leading to smoother operations and increased revenues.
Why do new hires leave? Opinions differ depending on who you’re talking to:
Top Cause of New Hire Failure According to Employers: Bad Attitude
A study by Leadership IQ notes that 48% of new hires fail in the first 18 months after being hired, and only 19% achieve unequivocal success. According to hiring managers:
Conversely, employers say a new hire’s ability to take feedback, their overall intelligence, and their communication skills are the attributes most often found in the top 20% of quality employees.
Takeaway: Soft skills may be just as important if not more so than hard skills when it comes to Quality of Hire. Employees who interact well with others and are flexible enough to change approaches when needed can benefit businesses more than employees who are rigid and take any attempts at constructive feedback personally.
Top Cause of New Hire Quit According to Employees: People Problems
According to the Korn Ferry Futurestep Survey, a majority of executives said that between 10%-25% of new hires leave within the first six months after hiring. However, the numbers may be higher than that: HBR reported that up to 30% of new employees leave their jobs within the first 90 days of getting hired.
Employee reasons for leaving both tracked with and disputed employer perceptions. While complaints about job descriptions and job expectations were common, people problems rather than lack of technical skills were at the root of many new hires’ decisions to quit.
In order to attract and retain employees with attributes that give them a high Quality of Hire score, businesses must make a point of showing they can appropriately appreciate and reward such employees.
Takeaway: Quality of Hire may not be completely dependent on the new hire: the thoroughness of onboarding and managerial finesse may play a large part. When Quality of Hire is matched with internal support and respect as well as a great company culture, loyalty levels and retention can be maximized.
Three Ways Crosschq Can Help
#1: Crosschq has developed a Quality of Hire scorecard designed to help you build an understanding of how to recognize and measure Quality of Hire. Our Talent Intelligence Cloud™ is designed to help you surface top candidates and recruit them for your organization.
#2: Crosschq Data Labs is constantly researching Quality of Hire. Discover the latest insights for this all-important hiring metric in The Crosschq Q (Quality of Hire) Report. Over 24M hiring decisions with analyzed and 5 radical insights were discovered to help you hire, retain, and develop top talent.
#3: Crosschq team experts can help your company identify, hire, and retain candidates with Quality of Hire potential. Contact us for a demonstration today to see how.