A Bad Hire Will Cost 3 Times Their Annual Salary

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bad hire

A bad hire is like a bad apple in a bunch. If you have a rotten apple in your fruit basket, no matter how much care you take or how much you try to make the prevailing conditions favorable, you will end up with a rotten bunch of apples. If we quantify the monetary loss you make with a single hire, it totals to 3 times that role’s annual salary. This cost comes from recruitment and advertising fees, training and relocation fees as well as staff time lost carrying out recruitment and on boarding processes.

The thing with a bad hire is that the effect is not just monetary. Below are more far-reaching effects of a bad hire.

Negative Impact on Team Performance

managing different personalities

Disengagement in the workplace is contagious. This might be the reason why it is so hard to get rid of. The Gallup  report shows that less than one-third employees in the U.S. are engaged at work. Closer home, the BrighterMonday Best 100 companies report revealed that only 39% of employees in Kenya are happy with their current employers.

When a disengaged employee fails to pull his weight in the company, good, hardworking employees burn out trying to make up for it. You might even end up losing very good employees on the account of one bad hire.

Negative Impact on Your Company Culture

In many ways, the impact of a bad hire in a company will go beyond their tenure in that company. This means that a single hire, especially one in a leadership position, can actually overturn the company culture you have worked so hard to create and nurture. Poor performers tend to lower the bar and bad habits spread like a wildfire. You are left picking pieces of what used to be your vibrant culture and retraining employees.

Loss of Customer and Stakeholder Goodwill

office conflict

A bad hire will not only demotivate their fellow employees, they will chase your customers away. Poor performance will affect output and the first person to feel it will be the person the service or product is being offered to; the customer. 96% of customers do not complain of bad service, they tell their friends and leave. By the time you realize something is wrong, how much business and potential business will you have lost?

Dent on Your Company Brand

In the age of technology and social media, negative PR is any company’s worst nightmare. A single action by your staff could leave the company’s image and goodwill you have worked hard to build in tatters. You lose existing and potential customers if your company is painted in negative light. The negativity and toxicity brought about by a bad hire also affects the internal environment of a company and your good employees slowly stop being your ambassadors.

The cost of a bad hire is always extensive. If you make one bad hire, there is a ripple effect across your entire organization, your product and service quality. BrighterMonday has recruitment solutions to ensure this doesn’t happen. Our BestMatch solution matches the best talent with your open positions. Our bespoke mix of technology and human systems match not only quantitative traits of candidates but qualitative ones as well. Check here to select a product that best suits your current vacant position.

Doreen Mueke
Doreen is the Senior Content Marketer at Ringier One Africa Media.