The cost of a 'bad hire' to an organisation is five times the bad hire's annual salary and hence companies should focus on hiring the right talent to mitigate business risks, says a report.
According to Society for Human Resource Management (SHRM), hiring the wrong candidate can prove to be a costly affair because every employee in an organisation has a big impact on performance, company culture and its success.
"The cost of a bad hire to an organisation is five times the bad hire's annual salary," SHRM said and added that an elaborate screening process before hiring is a crucial task faced by many organisations today.
"The future of any organisation solely depends on the kind of employees the organisations have and that makes screening a crucial aspect of the overall hiring process," SHRM India CEO Achal Khanna said.
It has been observed that by recruiting right candidates, organisations have achieved success and growth and that has contributed substantially in brand building.
"There is a need for flexible and tailored screening solutions for candidates before hiring by any organisation," Edward Hickey, Managing Director - APAC of Hire Right, an employment background screening provider, said.
The report noted that there should be in- depth interviews soon after a new employee has joined to understand his expectations and the firm should also make use of informal gatherings and social media, to make the prospective hire a part of the system even before he has actually joined.