Quality of Hire: What It Is and Why It Matters

When looking for candidates for your business, it is vital to find those that will add long-term value to your company. While traditional interviews and background checks shed some light on individual applicants, hiring an unsuitable candidate is all too easy. 

This will lead to a recurring cycle of short-term recruits who quit or are fired, leaving you with a pressing need to fill vacancies regularly. It takes time, and employing a new worker is costly.

Thanks to technological advancements, hiring managers and recruiters are getting a more precise picture of the key performance indicators (KPIs) that can identify a great candidate. One of the most important KPI measures for attracting and hiring suitable candidates for each role is the quality of hire.

 

What is the Quality of Hire?

Quality of hire refers to the value that a new worker provides to the overall success of your organisation in the long run. 

Given the high cost of hiring and training new employees, it is no wonder that finding quality candidates is becoming a higher priority for recruitment practices. 

 

Quality of Hire metrics

LinkedIn says that quality of hire is one of the top five hiring metrics organisations should use to hire top talent. These metrics refer to the quantifiable factors of hiring that reflect the value of employees to the organisation in the long run.

The most common metrics include:

• Employee performance

• Hiring manager's satisfaction

• New employee fit

 

Calculating quality of hire

Calculating the quality of hire of an employee throughout the hiring and training process is not the same as calculating it for your entire organisation. 

The basic calculation is:

Quality of Hire = (Employee Performance + Hiring manager satisfaction + New Hire Fit)/3

 

Employee performance

Several factors can be used to calculate the value of employee performance, including:

• Job performance

• Employee engagement 

• Time to productivity (how long it takes for an employee to become productive)

• Cultural fit 

You can accurately estimate the quality of new hires and their performance by calculating the average of all variables on a constant rating scale, for instance, 1 to 10. 

You can also calculate the average scores among all new hires to determine your overall quality value for new hires.

 

Hiring manager satisfaction

While it may be tempting to focus on new hires, the hiring manager's satisfaction is crucial to your company's hiring quality. You can gather key info about the recruitment and hiring process by conducting frequent internal surveys. With a custom hiring manager satisfaction survey, you may determine:

• General satisfaction with the hiring process

• Recruiter's success with promotion and engagement

• Overall candidate quality

• Quality and promptness of communication

• The manager's understanding of their role within the company

This data is critical for ensuring the progress of your recruitment process.

 

New hire fit

Choosing the perfect employee for your company is more than simply assessing their performance; it also entails ensuring that they fit in effortlessly. Consider the following factors when evaluating your new hire's fit with the company:

• The employee's understanding of their role within the company

• Dedication to the organisation's values

• Engagement with position, colleagues, and the organisation as a whole

• The employee's compatibility with the company culture 

 

The overall quality of hire

You can calculate the overall performance of your recruitment process by using individual scores from: 

• New hires, 

• Hiring manager satisfaction surveys, and 

• Employee retention numbers.

You can also calculate the quality of hire for certain recruitment strategies by parsing the information depending on recruitment tactics or specified durations.

 

How to improve quality of hire

Improving the quality of hire takes months or even years. Why? Because quality of hire focuses on enhancing your overall recruitment and hiring strategy. 

The ultimate goal is to ensure that the employees hired create more value for the company than they earn. But first, you must do the following:

• Collect both pre-hire and post-hire data, 

• Keep the hiring workflow organised, and 

• Establish common goals for hiring managers. 

 

Collection of pre-hire and post-hire data

The recruitment strategy should include pre-hire data such as:

• Interview test

• Resume screening scores

• Reference scores

• Job skill tests

Post-hire data is also essential and contains: 

• Employee's self-ratings

• Manager satisfaction 

• Employee's length of tenure

• Productivity numbers

 

Organising hiring and recruitment workflow

Organising your recruiters' and hiring managers' workloads can help you streamline the process and increase the productivity and efficiency of your hiring efforts.

A streamlined workflow enables quicker candidate selection by:

• Improving screening processes via automated technology

• Analysing data from candidate conversions to identify areas for improvement

• Creating flexible strategies that make use of resources as needed

• Customising templates and automated procedures for repetitive tasks

 

Establishing common goals for hiring managers

Improving your hiring quality requires all of your hiring managers to be on the same page when it comes to recruitment and hiring goals. Communication is essential for setting clear goals and streamlining operations for a quicker, more efficient hiring process. 

Get your hiring managers on the same page with:

• Clearly defined terms and goals,

• Established best practices for candidate interviews and employee assessments

• Consistent metrics and benchmark rankings

 

Source: crosschq