The Ultimate Hiring Guide:
How to Avoid A Bad Hire and Build A Rock Star Team
The cost of a bad hire is staggering. Great companies are made of great employees, so when you hire the wrong person for the wrong job your company can take a serious hit.
In this blog post, I’m going to be your HR hero and rescue you from the potential despair of making a bad hire. I’ll share with you some common pitfalls we all make in our hiring process that leads to a crappy hire. Plus, I’ll give you Mark Fisher Fitness’s tried and true hiring system that will guarantee a rock star team!
The bad news first.
41% of people surveyed by Careerbuilder.com said that a bad hire in the last year cost them at least $25,000! WTF?! That’s a ton of money, and it’s just tip of the iceberg.
Those same companies surveyed also reported a measurable loss in worker productivity, lost time spent on recruiting and training, a negative impact on employee morale, and a decline in the quality of service to clients.
All of that from one bad hire!
Throughout my career, I’ve witnessed the domino-effect-shit-storm that can be triggered by hiring the wrong person. So why do we make bad hires?
The biggest reason… we hire too fast. We’re in a hurry to fill a position quickly so we rush the interview process and miss critical cues that would be more obvious if we took our time.
The old adage “hire slow, fire fast” always proves to be true. The more time we take as employers to really get to know a candidate, the more likely we are seeing the person for who they truly are. When we rush it, we do a disservice to the candidate and to our company.
The second biggest reason… we ask the wrong questions. Interviewing is a critical skill every employer has to master and all too often we fail at the basics. Asking the right questions is key to testing the candidate’s skills and experience. A great interview brings the candidate’s strengths and weaknesses into striking focus and tests them with real-world examples. When you can do this as an employer you’re infinitely more likely to hire the right person for the job.
The third biggest reason we make a bad hire is simple… we don’t check references. We skip the step of talking to the people who have worked with the candidate in the past.
Duh! This is so important, so why do we skip it? It takes too much time, we skim generic reference letters instead, blah, blah. There are lots of BS reasons for skipping this step, but it will kick you in the ass every time. Bite the bullet, pick up the phone, and talk to at least 3 people who your candidate has worked with in the past. Ask them probing questions that require real-life examples and you’d be shocked what you can uncover!
Here comes the magic.
Now in our fifth year of operations, with over 30 employees, I can proudly say that Mark Fisher Fitness has lost maybe one or two employees due to being a wrong hire.
Those are pretty great stats. Here’s how we did it.
At MFF, we use a five-step approach to hiring that has worked extremely well for us. While this exact process might not work for your business, there are plenty of core strategies that everyone can use.
Before we even get to step #1 of the hiring process I’ll give you a bonus tip to get started. In order to create an effective job listing, you must first create a kick-ass job description. Take time to create a job description that includes these vital components:
• The story of your company
• Your company’s mission and values
• An overview of the position — what is its purpose?
• A detailed list of the roles and responsibilities
• A wish list of key competencies and experience the candidate should possess
• Clear next steps for candidates to start the application process
The quality of your candidates is directly related to the quality of your job listing. If you are unclear about what is required of the position, you will get candidates who are unclear and whose skills don’t match the opportunity.
Got that? Cool.
Now you’re ready to start hiring.
STEP #1: Review the resume
The key question you are trying to answer in STEP #1 is… Does the candidate’s experience match the job requirements?
As you review the resume (and cover letter) ask yourself:
- Does the cover letter convey an understanding of the position?
- Does the cover letter illustrate alignment between the position and the candidate’s career goals?
- Does the resume include experiences that reflect the key competencies of the position?
- Does the resume reveal any patterns that require further inquiry? (Constantly changing jobs, many years at one company with no promotion, etc.)
If you can answer yes to most of those questions, the candidate moves on to…
STEP #2: The initial phone interview
The key question you are trying to answer during this initial phone screening is… Is this person a valid candidate?
During the phone screening ask yourself the following yes/no questions:
- Can they start on the proposed date?
- Does the salary range match their needs?
- Does the proposed work schedule match their needs?
- Can they speak clearly about the experience referenced on their resume?
- Are they generally engaging in conversation?
If you can answer yes to most of those questions, the candidate moves on to…
STEP #3: Group interview
A group interview is multiple candidates and one (or more) interviewer.
For this phase, we bring in 3-5 candidates at once for a group interview. This can be tricky if you’ve never conducted a group interview before. However, once you get comfortable it is a valuable time-saver and can tell you much more about how the candidate works with others that you might find out in a one-on-one interview.
The key question you are trying to answer in this phase is… Is this someone I want to spend more time with?
A quick tip for conducting group interviews: Have a plan. If one or more of your staff are interviewing three or more candidates you’ll want to plan some questions in advance and coordinate who on your team is going to ask each question. A little bit of prep can go a long way to creating a professional first impression. Remember, the candidates are also interviewing you — so don’t lose a great candidate because your group interview is confusing and chaotic.
Now, let’s dive into the interview itself.
The single most-important interview strategy I can share with you is this.
Ask the candidate about specific times in their past when they demonstrated key competencies of the position. We call these behavioral-based interview questions.
Rather than asking “what are your strengths?”, ask “Tell me about a time when you used one of your strengths to overcome a challenge in your career.”
Rather than asking “What would you do if a customer was upset with a decision you made?”, ask “Describe a specific situation from your past when you had to deal with an upset customer.”
See the difference? It’s huge.
The first question gives the candidate room to give you an answer based on what they think you want to hear. They can just make shit up!
When you ask behavioral-based questions you are asking the candidate to explain how they’ve responded in the past to a given situation which, my experience shows, is strongly correlated to how they are likely to perform in the future.
Sure, a candidate can still lie. But your bull-shit meter will be much more accurate when the candidate is forced to tell a story from their past rather than describe themselves in a vacuum.
As a special bonus for you…
Download our list of Behavioral-Based Interview Questions here >>>
As the interviewer during the group interview you (and other staff present) should be taking notes that reflect answers to these key questions:
- What was your first impression of this candidate?
- What are the candidate’s biggest strengths and weaknesses?
- What is their preferred position when working in a team?
- How aligned are the candidate’s values with the organization’s values?
- How do you envision the candidate working with the existing team?
- What unique skills and experience do this candidate offer?
- Did the candidate proactively ask thoughtful questions in order to understand the role and your company culture?
- How prepared was the candidate for the interview (on time, dressed appropriately, came prepared to ask questions, etc.)?
Candidates who perform well during the group interview then move on to the next round.
At this point, you would do reference checks! Don’t skip it.
As I mentioned earlier, you want to call at least three people the candidate has worked with in the past. Ask yourself, do the candidate’s references support the claims on their resume? Do the references communicate a positive working or personal relationship with the candidate?
If a candidate performs well during the group interview and has solid references, they move on to…
Step # 4: Solo Interviews
A solo interview is one candidate and one (or more) interviewers.
The key question you are attempting to answer during a solo interview is… Can I envision this candidate succeeding in this position?
Just like in the group interview, stick to behavioral-based interview questions. This time you get the added bonus of seeing if the candidate’s answers are consistent with the previous group interview.
Inconsistent answers can mean lots of things — they’re nervous, not telling the truth, or misunderstood the question. You never know. So when you come across an inconsistency, just ask the candidate point-blank to explain the conflicting responses.
As the interviewer you will want to consider:
- Same as the Group Interview questions, plus…
- How consistently does the candidate speak about themselves and their experience throughout the interview process?
- At this point in the process, how accurately can the candidate describe the position they are seeking? Can they demonstrate learning and information retention?
- What hesitations (if any) do you have about this candidate’s ability to succeed in this position?
At this point you should feel like you are really starting to know the candidates. Your team will have spent a few hours speaking to them from the phone screen, to the group interview, to the solo interview.
You might be tempted to hire someone at this point.
This final step is the one that businesses NEVER do and it’s the MOST important. (See how I used ALL CAPS there? It’s that valuable!)
Once you are 90% sure you want to hire someone, you move them to the final step…
Step #5: The Pressure Test
Let’s face it. Up until this point, the interview process has just been a bunch of talking. Talking is cool. Talking is important. I like talking.
But, most jobs you are hiring for require lots and lots of DOING.
The pressure test is designed to see the candidate perform key skills in real time, ideally under some pressure.
During this phase, the key question you are asking yourself is… “How does this person perform under pressure?”
Here’s the thing about Step #5, I can’t give you a step-by-step how to do it. Every business is different, and performance expectations for the same roles at different companies will vary wildly.
You are the expert on your business, so you know best the kind of performance you are expecting from an ideal candidate. Design your pressure test to be as realistic as possible to give candidates a real sense of what life will be like on the job.
Some examples of great pressure tests:
- Hiring a class instructor: Ask the candidate to give your team a 30-minute class of their own design. Collect staff feedback afterward.
- Hiring a personal/small group trainer: Ask the candidate to design a program and train a few of your staff or clients. Collect feedback afterward.
- Hiring a front desk associate: Ask the candidate to spend 1 hour at the front desk to see how they interact with your clients.
- Hiring a sales associate: Ask the candidate to take you to a nearby business they admire, give you a tour, and try to convince you to buy something.
Have fun with it. A well-designed pressure test will immediately give you a sense of the candidate’s authentic personality and show you how they are likely to perform when thrust into a new situation.
The kind of information you get from a pressure test is interview GOLD!
Now go do it.
This was A LOT. I know. Here are some thoughts on how to begin implementing these ideas.
If your hiring process is already working for you, great! Perhaps there are a few takeaways from this post that can help you make it 1% better.
If you don’t have a hiring process, or your process is a hot mess, take a deep breath and pick one thing to implement first.
The strategy I shared that has the biggest bang for your buck (by far) is also the easiest to implement — just start asking behavioral-based questions. If you don’t change your interview process at all, but start asking better questions, you will see an immediate improvement in how well you get to know each candidate.
Remember, a bad hire can cost you lots of cash, sweat, and tears.
So, take your time and hire slow.
A great employee is worth their weight in gold. They bring value to your clients, and your community. Choose wisely.
This is so much gold. Thank you for taking the time to format this into such a polished valuable article. Reading through it all screams of your experience and education with the process of interviewing/hiring and I can’t thank you enough for sharing it with the rest of us.
As our business comes up on our 10th year I can only say I wish we had a guide like this in year 3. Would have saved us a ton of headaches… and money. Even with our system being somewhat solid, I still took away multiple ideas to implement immediately with our current position open. Again, THANK YOU!
Thanks so much Dustin!!
So glad you found it valuable Dustin!
Great stuff…one question – what parts have you built into the process to correct for unconscious bias in hiring and promotion decisions? Google has been in the forefront on this, and with how progressive your training techniques are, I’m wondering what lessons you have taken from them and others in your hiring practices?
Great question. You’re so right, unconscious bias is a huge challenge when hiring. As Google has noted, there is a TON of research about the problem, but not a great deal of “proven” strategies for a solution. A few things that I think we do well — and are also inline with Google’s four prong approach are: having a structured interview process, embracing individuality, and holding everyone accountable to detect bias when it arises.
There is ALWAYS room for improvement, but here are a few thoughts about what I think is working with our approach:
A structured interview process helps to level the playing field for applicants and ensures that they have access to a similar vetting experience.
Clearly MFF has some strong values about inclusiveness and individuality. So unlike some companies that might lean toward a certain “type” of employee for certain roles, part of our DNA is inclusion and diversity. We’ve always sought out and rewarded difference, especially in our hiring process.
The last one is possibly our greatest strength – holding each other accountable to transparent decision-making. If there is one thing the MFF team works on most is our ability to have crucial (and sometime uncomfortable) conversations when needed. The hiring process is no exception. If anyone suspected a colleague was making a hiring decision based on a biased perspective we have great practice voicing that concern to one another.
The big challenge in this space is that no one seems to have a solution for helping to consistently make the unconscious, conscious. By definition, our biases are mostly unknown to us, so the key seems to be on-going training and awareness, paired with clear hiring systems and positive work culture.
It’s a fascinating topic. Anything you’ve read that’s resonated with you?
So glad you asked!
Great stuff guys. Thanks
As far as your last question Michael, in Charlie Munger’s 25 Cognitive Biases talk, he references the difficulty/unreliability of accurately assessing a candidate during the interview process.
He says the interviewer is very susceptible/biased to believing he/she alone can really spot a great candidate…while this is usually not the case. He encourages employers to look more to the candidate’s history of achievement rather than simply rely on the interview impression.
Maybe part of the practical answer to “making the unknown known” would be having more people review the candidate (lessening the likelihood of an individual bias prevailing).
Sounds like you guys are doing ridiculously well at hiring so take that for what it is worth.
Great resource Jeff! I’ll check out Charlie’s work 🙂