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Hiring - The Million Dollar Decision

Your decisions DO have consequences... are you making the best of them?

What is the cost of a hiring decision (good and bad)?

It depends on the wage you will pay, what benefits you provide, what it will cost to train that person, and how long you expect to employ him or her. For a $12.00/hour worker with modest benefits that will work for you for 10 years, you are easily looking at half a million dollars when you factor in your costs beyond salary. That same employee working for 20 years becomes a million dollar decision.

But you may say, "I don't plan to hire them for 20 years. I can only plan for five years"... or three years... or 1 year (If you are planning for less than one year, you are looking for temp or seasonal help, not a "long term" employee. In which case you either hire temps, college students, or, if you need more skilled employees, contractors.)

Why are you only planning for 1, 3, or 5 years? Are you planning on firing the employee after that time (regardless of how good they are... or how much money they are making you?) Are you planning on going out of business by then?

If you can honestly say yes to either of those last two questions, then you have a bigger problem than your hiring process... one that a revised hiring process can't fix.

...it seemed like a good decision at the time... 

 

If you aren't planning and working for the long-term viability of your company and your employees, then don't be surprised when your plans come true. The short-term mentality will permeate your business (and any employees you may have.)

Now let's look at that (possibly) million dollar decision.

What if it's a good decision? Congratulations! It is either a result of good hiring practices or luck. Either way it good for you and good for the company. (What makes it a good decision varies in the specifics by company, but the general/overall guide is whether that employee contributes more to the success of the company than it costs to acquire and maintain that employee.) If it was by luck, be grateful (and then work on making it more than luck for the next time.)

And if it is a bad decision?

Turn the page to find out what a bad decision costs.  ==>
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