Investing in a competent employee selection process isn’t just about getting the best people on board; it has far-reaching financial implications for a company. As revealed by a survey conducted across 2500 firms, one incorrect hiring decision can lead to an astounding loss of more than $25,000, owing to decreased productivity, low morale, and other associated costs. Certain sectors might experience even higher damages. Evidently, an energy service firm encountered a staggering $400,000 loss due to one poor hiring decision.
The above-mentioned statistics originate from a report titled “One Month to a More Effective Compliance Program: The Reference Check.” It’s authored by Thomas Fox, who is regarded as a Compliance Evangelist and who emphasizes the importance of proper reference checks for companies from a compliance perspective.
The report provides valuable insights into making the hiring process more robust and effective, reducing compliance risk and improving overall team morale that builds the organization’s success.
Hiring the right people is vital for an organization’s success, but it’s only half the battle. The real challenge lies in minimizing the possibility of making a bad hire and managing the associated costs, which can be incredibly detrimental.
Understanding these dynamics, Fox provides strategies to improve companies’ hiring mechanisms. By heeding his advice, companies can minimize their exposure to compliance risk from the hiring stage itself, potentially preventing significant financial damages down the line.
Evidently, Fox’s analysis is a must-read for both legal professionals helping organizations streamline their compliance procedures and corporate entities intent on beefing up their hiring strategies.