Of all the things people debate in business, no one argues that turnover is costly. Although quantifying the cost is tricky, research conservatively puts the replacement costs alone at roughly 20% of the departed employee’s salary. That doesn’t include lost opportunity costs or other intangible costs employers undoubtedly incur. When you factor those things in, organizations like the Society for Human Resource Management estimate the total cost of turnover to be up to 500% of the employee’s annual salary.
The assessment problem
Given the data, it’s no wonder why you never hear debate about the importance of hiring someone who’s going to stick. Every employer wants to generate healthy profit and reduce preventable expenses and risk. It should go without saying that hiring for culture fit is a must.
But despite knowing the importance of culture fit, a lot of companies don’t know how to assess candidates for it. In smaller companies that lack a formal HR structure or hiring manager, leaders rely on their gut feelings and a candidate’s general likeability during the interview process. This stuff is important, but it’s not as reliable as a defined and consistent system for evaluating cultural fit.
Culture fit focus
Here are two ways you can use culture-specific criteria to improve the way you screen for cultural fit:
Ask candidates to interpret your values
Company values should be so much more than words painted on a wall in your office or collecting dust in an HR manual. Values should be at the cornerstone of your day-to-day work. They should inform how you and your team behave. They must be observable in your actions, and they should guide your culture. If you’re not talking about them when you evaluate candidates, you’re missing a huge opportunity.
The first step to take when hiring for cultural fit is to ask candidates to interpret what your company values mean to them. Don’t coach them first. Simply ask them questions like, “Tell me what the phrase (insert value statement) means to you.” If their intuitive response aligns with how your company interprets those values, you can objectively say the candidate gets it. If you really want to get serious about measuring candidates’ interpretation of your values, you can assign a quantitative score to their response instead of relying on your gut feeling.
Use value-based behavioral questions
Behavioral questions are a staple for effective interviewing, but the ones you use for your organization shouldn’t be canned. Take your values one step further and think about times in the company’s history where a team or an individual did a stellar job of living them out. Take those situations and reframe them into a behavioral questions for the candidate.
So, for example, let’s say your organization really values relationships. A team member goes above and beyond to recognize a milestone in a client’s life (i.e., orders meal service for a week following the birth of the client’s first child). This represents the “ultimate” example of a team member living out your organization’s relationship value. Now, take that situation and ask a candidate, “Tell me about a time when you did something for a client that showed your care for them as a person and not just a client.” If the candidate’s answer is anything remotely close to the “ultimate” example you used to inform your behavioral question, you know they’re tracking with your values. And if you want something measurable, create a scoring system that allows you to assign point values to candidates’ responses based on how close their answers are to your “ultimate” benchmark.
One step at a time
Something as fluid as culture can be tricky to nail down. As long as people are involved in organizations, cultures will change, morph, and evolve over time. Research will undoubtedly continue in this area, but one thing is clear: having the right people in the right seats with the right perspectives will always be critical to an organization’s success and health. For culture-focused companies who really take fit seriously, it’s imperative to develop and implement a system that allows you to objectively screen candidates in this area. If you want to start somewhere, start with your values.
And if you need some help putting it all together, I’m only a click away.