Hire Fast, Fire Faster is one of the most common hiring mantras ever. ‘’What are the aspects that you think can make or break a company?’’ My answer was team, product, and market.
Subsequently, the next question that probably pops up in your mind is: ‘’And what if you would need to rank these three factors? What’s the number one thing you should worry about then?’’ And of course, working in an HR tech startup myself makes me absolutely biased, but my answer is most definitely the team.
Why? Well, because although we are building a tech company, we need amazing people to actually do so.
We need a team to:
- Analyze the market
- Build the product based on our market research
- Gain and retain new customers
- Constantly assess our product-market fit
So yes, product and market are extremely important as well, but you will never be able to focus on these two aspects on your own.
The origin of this startup mantra: Wanting to Decrease Time-to-Hire.
Building successful teams is a tough challenge. Especially tech companies often find themselves in a situation where they reach that point of hyper-growth ‘out of nowhere’, requiring to rapidly build teams under significant time pressure. Moreover, there are also often a lot of fluctuations when it comes to hiring needs. Just after raising funding, the hiring machine in most cases starts running, while somewhere halfway through this investment, things will likely slow down again for a while. I’m sure you already know that.
But no matter the situation, let’s face it, we all want to reduce the time to hire.
Time to hire ticks all the boxes when it comes to our desires when assessing hiring efficiency – it’s very easy to define, it’s even easier to measure, and you can measure it right after you made a hire.
The shorter this period, the better, as it usually improves the candidate screening experience, and it means your business has found the perfect fit for an open role quickly and efficiently. Whereas, taking too long to fill jobs increases our cost per hire and comes with the risk of losing top talent.
It’s a hallmark of a dysfunctional organization: A job is opened for a position, but it takes 4 months to make a hire. By which time thousands of euros have been spent on recruitment efforts, six figures of revenue have been lost, and the HR department and the hiring manager are barely speaking to each other by now.
The Other Side of the Coin: Too Much Focus on Time to Hire
However, most of us tend to forget that hiring is more than just measuring the time to hire. And that’s where most of us go wrong. Yes, you succeeded to reduce the time to hire, however, you will also experience the costs of letting people go as fast as you’ve hired them (or even faster).
Yes, having a low time to hire would indicate that the hiring process is set up efficiently. However, ’’hire fast, fire faster’’ is the most dangerous hiring mantra for any company.
Why? By focusing on primarily ensuring an open job position is filled as quickly as possible, your focus will shift away from quality to speed. Time to hire is not very indicative of your hiring efficiency if the new hire ends up walking away after 3 months and you’re stuck just where you first began – with an empty job role and tons of sunk costs. 😉
My observation of this ‘’hire fast, fire faster’’ mentality: companies stick to this mantra out of fear.
- Fear of missing out on the best candidates.
- Fear of not being able to grow as fast as you would like to grow.
- Fear of never building the right product and selling to the right market.
Here’s my business case that’ll help you let go of these fears and build teams that are future-proof.
Calculation: The savings of ‘hire fast’ vs. The costs of ‘fire faster’
Calculation 1. Your savings of hiring faster
Let’s say you hire 50% faster than companies that don’t live by this mantra, as a result of having less interviews and less hiring stages. Here at Equalture, where we don’t want to hire fast, we spend on average 30 hours on one hire, when taking the hours of all team members participating in this process together. This includes the hours to:
- Create and distribute a job opening;
- Check the incoming applications (which goes very quickly since we are of course using our own platform and therefore receive a complete Candidate Profile for each new application);
- Have a quick chat on the phone with the candidates who have passed the first review (we have this call to check whether the candidate has the same view on the job as we have);
- Conduct some first and second interviews (in which always two people from our team are joining);
- Finalise the paperwork.
So when applying this hire fast, fire faster principle, we could save 15 hours. Now let’s say that we are worth €100 p/hour – this then means that we could save €1,500 per hire.
Calculation 2. Your costs with firing faster
On average, the costs of a mishire are 1.3x this person’s annual salary(!). This is built up from the following costs:
- Hiring costs;
- Onboarding costs;
- Delay on targets as a result of non-performance;
- Impact on team dynamics and team performance.
Now let’s say that, since you will be likely to fire people faster, the costs of a mishire are only 0.65x the annual salary.
This means that, when hiring for instance a Business Developer, having a yearly salary of €36,000, this person will now cost you €23,400 if they turn out to be a mishire.
You saved €1,500 by hiring fast, while you risk the chance of making a mishire, costing you the doubled amount, when firing faster. Hopefully this calculation, therefore, starts to make you reconsider this mantra.
The human aspect of Fire Faster
Although I am a big fan of calculations and business cases, since it creates more urgency, let’s definitely not forget about the human aspect here, both for the people you hire, as well as for your current team.
When easily hiring and firing people, you can heavily impact their vision on employers. And at the same time, there’s nothing more damaging for your company culture and team spirit than constantly adding and removing people.
Gamification to Reduce Time-to-Hire Without Sacrificing Hiring Quality
Here at Equalture, we have built a library of scientifically-validated game-based assessments to help companies get to know their candidates’ skills, behaviour, and personality in an objective way, rather than having to guess by looking at someone’s resume. This way allowing you to reduce time-to-hire while simultaneously improving your hiring quality. And allowing you to let go of all the fears making you rush your hiring decisions.
It is time to reevaluate and revolutionize your company’s recruitment process.
Try out a game yourself!
- Know who you need. By assessing the current team first, you will get a clear overview of the current representation of your team – so for example, if your team consists of highly flexible people only, or not. This will help you determine what to look for in your next hire.
- Save time screening candidates. Game-based assessments, in contrast to traditional tests, can be introduced early in the process, because they are short and immersive, engaging for candidates and allows you to spend time interviewing the high-potentials only, resulting in a shorter time-to-hire and less time spent per hire, while simultaneously improving hiring quality.
- Find the balance between speed & quality. Equalture allows you to focus your time on the right people, decrease the number of candidates to interview, and the number of steps in the process (after all, you’ll already have a lot of insights at the starts). This way allowing you to find a balance between hiring speed and hiring quality. After all, time is money.
Our mantra: Take your time to build your team and culture
That’s why it’s time to change your growth mantra from Hire Fast, Fire Faster to Take your time to build your team and culture.
No rush. No fear.
Ready to get started and make hiring decisions that are future-proof?
Get in touch with us – no strings attached!