Elevate Evaluation Expectations
The average direct cost-per-hire is $4k and the average cost to train a new hire is $1.2k. This $5k+ estimate, unfortunately, does not include the hidden costs of bad hires such as eroded customer trust, slowing sales, coworkers’ compensating efforts and overtime, offboarding and replacement costs, and possible litigation. The financial, operations, and intangible impacts of hiring, training, and performance management decisions are driving modern organizations to increasingly count on and, account for, their exceptional people and HR enterprise investments.
The tradeoffs of internal and vendor provided recruiting, selection, and training investments are often considered relative to the net present value of alternative capital investments. The immediate and ongoing fixed and variable costs, as well as anticipated and realized benefits, of HR solutions must be documented. Leaders can leverage this to verify the efficiency of the legacy programs they champion and plan as historically effective solutions become brittle.
The “people that make the place” are the most important investment and enduring competitive advantage because employees, unlike strategy, technology, facilities, products, and services, cannot be readily copied by competitors. Investments in selecting, developing, and managing talent are also more critical to your organization’s long-run success than those in depreciable assets because employees and social networks are often current or potential customers.
Employers leveraging HR best practices outperform their competitors that fail to fully harness organizational science. Effective talent solutions benefit not only employers but employees, strategic partners, and even entire economies. Effective solutions must also be efficient to minimize costs as there are diminishing returns from using selection assessment tools with limited incremental validity or training new hires beyond an optimal point. Unfortunately, findings suggest only 50% of HR solutions yield individual, unit, or organizational benefits.
Talent Threshold’s advisors can help you evidence, verify, and optimize your HR investments. Formative evaluations can inform successive iterations of solution design via a spiral process whereas summative evaluations evidence the performance effects of an HR program over time. We also execute studies to evidence solution usability, reliability, interoperability, and security.
To contact Talent Threshold’s organizational scientists call 407.739.0717 or email firstname.lastname@example.org.