This is a little scary… “Only 21 percent of CEOs feel they get their money’s worth from those they hire. ” And a survey of top HR executives at 25 of the global top 50 found that 80 percent of external hires were disappointments and promotions came in little better at 75 percent. According to the US Department of Labor, the average cost of a bad hiring decision can equal 30 percent of the first year’s compensation. Some metrics report the cost as up to five times the first year’s compensation.
That’s some of what we learned in Why Most Leaders Fail at Selecting and Hiring the Right People, a session of ExecuNet Master Class in which Mike Zani, CEO of The Predictive Index, examined why failed human capital management practices of CEOs are preventing many organizations from having their mission and vision realized.
Most interviewers don’t have the tools to assess the behavioral and cognitive aspects of candidates.
Interviews primarily focus on education, knowledge, skills, and experience; this is only six percent predictive of workplace performance. But if behavioral and cogitative assessments are part of the interview, that percentage increases to 51 percent. The behavioral and cognitive information can be used to better structure the interview to assess cultural fit.
Listen to this excerpt from the Master Class to hear Mike talk about why you need “a valid method to decode the human.”
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