Obtaining Credible Insights When Hiring: It Isn’t Personal, It’s Strictly Business

Why Do Hiring Professionals Believe Reference Checking is a Waste of Time?

It is my understanding that one of the main reasons hiring professionals believe reference checking is a waste of time is because the prospective hire would never submit the name and contact information of anyone that might provide negative feedback.

If you ponder that theory for a moment and then consider why anyone would simply drop the reference check based on the idea that they must accept names provided by the prospective hire, without challenging their relevance, makes absolutely no sense. After all, it isn’t personal, it’s strictly business. Talking yourself out of applying one of the most effective screening tools available, especially if you believe past performance is a solid predictor of future performance, is flirting with disaster..

 

Who’s Driving this Process Anyway?

Speaking with the Most Relevant and Credible Individuals

Ultimately, if you cannot speak with the individuals who know the prospective hire best and have worked closest with them in the past, you may as well not bother because it will in fact be a waste of time.

It is not uncommon that the collection of names typically takes place at the end of the interview process AFTER the decision to hire has already been made. This is a reactive approach to the reference checking process, and commonly treated as a mere formality that is most often a contingency of a verbal or formal offer.

With all the time and energy invested in the interview process, which can be months and months, especially at the executive level, it’s no wonder hiring professionals want nothing more than to get the seat filled. As enticing as it is to get the process over and done with, settling on the best of the worst is an open invitation for disaster.

 

Consider this Alternative to Waiting until the End of the Recruiting Process to Collect Names and Perform a Reference Check

Take the reverse approach and, during the time of the interview, diligently and thoughtfully probe on relationships the prospective hire has had with direct reports, managers, high level constituents and/or board members, and possibly clients. As detailed information about their relationship with these individuals and what the prospective hire thinks they might say about them when you call them. This will get the prospective hire to sit up straight and be more forthcoming, as well as allow you the opportunity to gauge body language when probed.

This is a crucial first step. This strategy allows for a much more proactive process and reduces the risk of waiting to the end to learn there may be an issue with the candidate’s ability to produce relevant and credible names.

 

Obtaining Names from the Prospective Hire During the Interview Will Help Prepare You for the Reference Check

Questioning the prospective hire on relationships with current and previous managers, direct reports, business leaders and high level constituents who have reported to or worked closely with the prospective hire, will provide you with invaluable insight as well as a solid foundation for preparation of reference checking should you decide to move the candidate to the final round of interviewing.

This approach will allow you the opportunity to identify the individuals they report to and work closely with, what types of relationships they believe they have with them, and, most importantly, who they can provide as solid references. If they cannot provide someone, this is their opportunity to explain why and your opportunity to probe in the event something does not sound right or make sense.

 

Request Follow-up from the Prospective Hire After Your Initial Interview

At the end of the interview, ask the prospective hire to follow up with full names, titles and phone numbers of individuals you discussed. If they do not follow-through, this could very well be a red flag that you are better off knowing sooner than later.

Provide assurance to the prospective hire that if you decide to move forward with reference checking, you will notify them in advance, allowing them the opportunity to notify the individuals.

If the job search is confidential, which is often the case, the due diligence of the current employer can then become a contingency of an offer, should all other due diligence demonstrate that the prospective hire is a fully engaged “A” Player who is well aligned with your culture.

These tips will allow for a much more proactive and strategic approach.

 

The failure rate of executives coming into new companies is nearly 50%, and they typically stay on board between 12-18 months. “Hire Slow, Fire Fast”, is not the rule of thumb followed by the majority of hiring professionals today. The cost of failure rates is mind blowing yet run rampant. A mid-range hire ends up costing approximately 10x the base salary and the higher the level, the worse it gets, on up to 27x at the CEO level.

These variables were obtained from GH Smart, among the best in their field when it comes to helping CEO’s, Boards, and Investors make smart hiring decisions. To measure costs, they performed extensive research collecting data from over 100 clients. 3-4x the loss is in the hard costs like compensation, training, benefits, etc., however, the most significant is in the lost opportunity and disruption. To reduce your exposure and increase profitability, incorporate a healthy due diligence process into your hiring process flow BEFORE you decide to hire someone that may turn out to be someone else.

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