Why Data Matters to Your Hiring Strategy
You know what you spent out of your private funds at the dinner last weekend. You know how expensive it is if the car breaks down and you have an idea of how much it is going to cost you if your roof breaks the following night between Monday and Tuesday. Now, let’s apply this to a business setting.
In Marketing, there is a saying: “Without data, you are just another person with an opinion!” My question for you is, how are you using data in your business?
First, let us look at the data you most certainly have. What you probably have is data on what you sold last week, quarter, year, and an applied CAGR for the foreseeable future.
You also know how many people you hire and how many leave you. Unless it is really bad, you explore this data on an annual basis. What I usually experience is that most companies do not put these events into actionable data. By this, I mean you don’t translate these events into how the financials look like when hiring staff or letting employees go. Training staff in employee-specific areas is a common thing in almost all companies but often HR or management settle for tracking measurable performance and not combining it with other costs in the employee aspect.
Real-life examples often work and what is seen in most performance-oriented companies is that if the employee churn (the number of employees that leave the firm) is high the performance perspective tends to focus on the financial top and bottom lines. Call centers where the employees typically are employed for up to 4-6 months have a fairly high cost on the employee account. What is usually done is that management and leadership ultimately pressure the individual departments into delivering more turnover by cutting training of new hires.
Going on an Employee Data Diet
My guess is that few of the good people in management would react in this way if they had solid data on the cost of this (very classic) behaviour. Research from 2015 by companies like Randstad and others shows that if an employee quits within the first 6-12 months it will cost the company somewhere in the range of 1.5-2 times the employee’s annual salary.
The thing is – and now comes the example with the diet – if companies with higher churn had collected and analysed employee hiring and firing costs, they would most likely focus more on improving that performance part first.
Strategy versus tactics. If you do not know how much you weigh then it will be almost impossible to set up the desired target for the loss of weight (strategy with SMART objectives) and afterward formulate a specific and actionable plan for executing the loss of excess fat.
So the question now is; do you lose sporadic fat or do you know where you are now based on data and where you want to be, and how to get there by your desired timeline?