How to measure quality of hire and 3 hidden problems to fix

Last updated:
July 15, 2021
December 20, 2021
min read
Adrie Smith
Table of contents

Recruiters run a tight ship when it comes to trying to get the right candidates on board. They’re judged on the time to hire, the cost of hire, the kind of candidate experience they offer, and ultimately the quality of hire.

The success of new employees often comes down to the skill of the recruiter. So while a great hiring process should result in qualified new employees, sometimes the quality of your new employees winds up falling short.

Poor hires, early dropouts, and even non-starters can cost a team dearly. In this post, we’ll demist the abstract concept of quality of hire, explaining what it is, how to measure quality of hire, and the three most common mistakes that can negatively impact the quality of your new employees.

Quality of hire definition

Quality of hire is a core recruitment metric tracked by teams to monitor the success of their recruitment process.

This is, understandably, an abstract concept. The quality of hire means something different for each company because the term ‘quality’ is up to the organization’s interpretation. Which begs the question: how do you measure quality of hire?

How to measure quality of hire

As a successful hire is interpreted differently for every company, quality of your new hires can be measured according to your definition.

Elements that may impact this metric are a new employee’s:

  • job performance;
  • cultural fit within the team;
  • contribution towards company strategy;
  • onboarding time frame;
  • or engagement;

Many of these elements will be difficult to measure, which is why the quality of hire has been so difficult to pin down.

However, if you implement a new employee rating system with stakeholders (manager, team lead, senior colleagues), this hiring metric will be easier to calculate.

For example, you could use the following calculation to measure quality of hire:

(Average performance rating of new hire + percentage of new hires reaching acceptable productivity in set time frame + retention rate after one year) ÷ three = quality of your new employees

For this to be a useful calculation, you will have to:

  • Put in place a new employee performance rating system and collect responses from key stakeholders.
  • Measure new hire productivity through a rating system.
  • Determine a set time frame where you will regularly collect this information (first month, three months or six).
  • Track your new employee retention rates on a yearly basis.

Why is it important to measure quality of hire?

Measuring the success of hires through this metric can be daunting, but it’s important to monitor to assure the return on investment of your hiring process.

Without measuring it and coming to a set statistic, you have no way of comparing the new employee’s performance with other team members.

It’s very easy for an employee to go under the radar. Without measuring the quality of hire, you could be spending more money than it’s worth.

Plus, it also allows you to spot patterns within your hiring process. If your quality of hire metric is poor across various new employees, it’s essential to consider your recruiting process and where things are slipping through the cracks.

Quality of hire survey

Surveys are beneficial for all business aspects, including recruitment and - you guessed it - measuring the quality of hire.

It all revolves around collecting important, impactful, and insightful data.

So, what type of surveys should you use to measure the quality of hire?

  • Surveys that ask managers or team members to rate the new employee’s performance.
  • Surveys that ask peers about engagement levels since the new addition of the team.
  • Surveys that ask the new employee about the hiring process and how they’ve felt since starting.

3 hidden problems you need to fix for your quality of hire

Is the quality of your new employees raising red flags? You may have one (or more) of these three problems lurking in your hiring process.

1. You’re not rating your candidates.

Almost every industry is becoming increasingly data-driven.

However, because of recruitment’s interpersonal and human nature, many teams shy away from tracking data during the hiring process.

Data can add so much value to your hiring process, especially when it comes to not only monitoring the quality of your new employees but safeguarding it too. Often a poor quality of new employees can be narrowed down to a lack of team assessment.

Get a better quality by implementing a candidate rating system among colleagues involved in the hiring process.

You can do this by asking colleagues to evaluate the candidates on a scale from one to five on various skills or qualities. The rating can be done at multiple stages of the recruitment process to help narrow down the candidate selection and ensure that only the best quality candidates (ranked by their potential team) proceed.

2. Prospective colleagues were not involved in the hiring process.

Testing candidates for the appropriate skills is a cornerstone of ensuring the quality of your new hires.

Assessments and aptitude tests are a standard way of assessing these skills. Results will indicate the skill level of the candidate and their suitability for the role.

However, external assessments for specific skill sets can be expensive and may increase your time to hire. Additionally, for low volume or infrequent roles, an external testing service investment can seem excessive.

Nevertheless, testing for skills is essential and necessary when it comes to the quality of the new hire, and you may be overlooking your best resource in this case: your team.

Prospective colleagues are well-placed to question based on experience or test on skills, as they work in that field. Get the candidates’ potential team involved in assessing the candidate early on as they will have a better indication of whether or not their skills are suitable for the role.

3. The candidate cultural fit was considered a nice-to-have.

A new employee can have all the skills necessary to succeed in their role but remember that they often do not work insolation.

When candidates are poor cultural fits, this can negatively impact both the new hire’s performance and their team’s. Therefore, lack of a cultural fit is a common pitfall that can significantly reduce the quality of hire.

Cultural fit is all about how a candidate interacts with the team, understands company values, and the degree to which they engage with the company mission. However, as many organizations struggle to find candidates with the right skills, once they do find an excellent skill fit in a candidate, cultural fit can fall by the wayside. After all, they have the skills to do the job.

The reality is, though, if a new hire does not communicate well with their team or share the same professional principles, their work and that of their team will suffer.

Make sure to avoid poor cultural fits by implementing a cultural fit question set into your structured interviews or by asking your team to pay special attention to cultural fit qualities during assessments or trial days.

Improving your hiring for a better quality of hire

Keeping a close eye on the quality of your new employees is essential to guarantee you’re getting the best returns on all of the effort and money spent in the hiring process.

There’s nothing worse than hiring someone, only to have them drop out after six months or for their team to be unhappy with the new addition.

As a measurement of the hiring process results, issues with the new employee quality often lie within the recruitment process.

Rating, collaborative recruitment, and assessing for cultural fit are three easy ways to improve your quality of hire through your hiring process instantly.

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