Quality of hire is a term we hear a lot, and I mean A LOT, in recruiting. So much so that it’s become a buzz word of sorts, something that people talk about in vague terms and that makes us feel good about what we’re doing. The fact is, though, it’s not a buzz word at all. We may throw it around when we’re talking about goals and proving a department’s value, but it has a very real meaning and it’s important for recruiters, HR professionals and executives alike to understand why it’s a focus for us.

The metrics

Quality of hire is made up of a couple of different metrics, but what’s just as important to focus on is what it’s not made up of. Often, HR departments attribute other unrelated metrics to this area, like time to fill, source of hire or cost of hire. While these are metrics you should consider, they’re all metrics that are secondary to quality of hire. In fact, in a perfect world, cost, source and time wouldn’t be a consideration, which would lead to higher quality hires.

What you should be evaluating as part of quality of hire are employee performance, culture fit, engagement, retention at specific intervals, culture fit and any other factor your organization deems an important measure of value. These are the measurements that paint a clear picture of whether or not an employee is a good fit. It’s not about how quickly or cheaply your company can hire. It’s about the value that new employee brings to your company.

The two areas below are perhaps the most important qualities you can evaluate when looking at quality of hire. They’re the qualities that should drive recruiter and sourcer decisions and what should always be top of mind when hiring. When you evaluate these two areas, they contain all the metrics that matter in quality of hire.

Filling a position quickly is great, but if that position is filled by a candidate who is half as productive as they should be, then over time it would prove to make more sense to take a longer amount of time to hire a better candidate. Productivity is one of the most important considerations because often times it determines your company’s profit. From sales to production to customer support, an employee’s level of productivity could have a real impact on your bottom line. And even if it doesn’t have a direct correlation, low productivity could impact co-worker morale, eat up the supervisor’s time as they coach and mentor a lagging employee and impact the employee’s internal customers’ ability to perform their jobs.

Increased longevity

Quality of hire is directly related to lower turnover and increased longevity, which is important for more reasons than just having to fill positions less often. When employees stick around for the long term, invaluable institutional knowledge is gained over time, succession planning can happen and those employees who were once newbies become experts leading the company. In 10 years, will you care about how much it cost to hire the manager who is now your CEO? Focusing on the long-term effects of your recruiting and hiring decisions – from culture fit to expertise to succession planning – is key to making a quality hire every time.