However, I know for you
to succeed you often have to get through challenges. One of the biggest
challenges that we hear over and over again is finding and hiring key people
for your companies. Man, this isn't easy is it? The truth is that we struggle
with this too, but we have made enough mistakes that we have begun to learn how
to do this a little more effectively, and over the next few weeks I want to
share a few pieces of wisdom and the mistakes that we won’.
First, let's talk about
the cost of hiring the wrong people. I'm not talking about the time and energy
cost. I'm talking about cold hard cash cost. If you are anything like me, this
is where I feel the pain. If we are really going to succeed at business, we
have to have the right people in the right positions. That's common knowledge.
But, what are the stakes of hiring the wrong person?
In the book Hiring Smart, the author gives the
equation: if you hire the wrong person for a position in your company and
rectify the situation within 6 months the cost of the mistake is 2.5 times the
person's annual salary. Now, based on my research the average annual salary in
the United States is $50,000. So, if you hire wrong and fix the mistake in
six months that mistake costs you $125,000. OUCH!
So, just to put this in
perspective let's talk about what you can buy for $125, 000.
- Gas for your car for
100 years
- 12 years of tuition to
a public college
- 1,316 tickets to
Disney world
- 10,416 pizzas from
your local pizza place (or pizza every day for 28.5 years)
- A private island in
Fiji
That's right. You can
legitimately buy a private island in Fiji for what a bad hire is going to cost you.
Let that sink in for a minute. On a side note, if you do decide to buy the
island instead of hiring the wrong person, I would be happy to visit your
island!
So before you embark on
your next hire, take some extra time to think if this person is really going to
help move your business forward or if you are giving away a private
island.
