5 Ways a Bad Hire Can Hurt Your Business

Hiring the wrong person for your business can be costly. It's not only a financial burden, but it can seriously hinder your reputation, interfere with client relationships, and halt your company's growth. And often, all it takes is one bad hire. As the saying goes, one bad apple spoils the bunch.

So what is the true impact of a bad hire?

In this article, we'll take a hard look at the direct and indirect costs of hiring the wrong person for your company.

Let's dive in.

1. They can impact your bottom line

The damage a bad hire can do to your company can be hard to quantify to the penny, but it does add up quickly.

Starting with the cost of training a new hire. According to data from the Association for Talent Development, employers spend an average of $1,252 per employee on training. The report also determined that an employer dedicates 33 hours to a training program.

In business, time is money. A bad hire can feel like you are flushing your resources down the drain.

If you have new employees who need to learn how to do their jobs or need help understanding your organization's culture, the cost of investing time and resources into training starts to multiply.

For instance, if you own a business that designs real estate websites, it'll cost more to train someone who isn't an expert in the real estate niche than to hire someone with the proper experience from the start.

And then you also have to deal with turnover. When people leave because they dislike the job or are underperforming (or both), replacing them also costs money.

Not to mention the impact on lost productivity. But more on that later.

2. They can decrease employee morale

More than just your bottom line suffers from a bad hire. When you have a bad hire, employee morale remains at all-time lows, and even your top-performing employees start to suffer.

Hiring the wrong person can make your existing employees feel like they aren't being valued, respected, or appreciated. This feeling can have a domino effect on your company morale and ultimately negatively affect your organization.

Employees will feel underappreciated and need to pick up the slack of the bad hire by adding time-consuming tasks to their already busy plates.

For example, suppose your marketing team is building a new ICP template to help identify your ideal customer profile and land higher-quality leads. But Sarah, the new marketing associate responsible for the key components of the project, keeps missing her deadline.

Ryan, the vice president of marketing, has to pick up Sarah's slack on top of all the other projects he is managing, like building out competitive battlecards.

Ryan feels incredibly overwhelmed (rightfully so) and wonders if he should consider applying to another job that's less demanding but equally as rewarding.

Ryan is a top performer at your organization. And adding Sarah, a bad hire, to the team, could be the straw that pushes Ryan to his wit's end. Now he's ready to jump ship to your competition.

3. They can lower customer satisfaction

Your customers are the lifeblood of your business. Without paying customers, your business goes bust.

So the last thing you want is to mess with your customer satisfaction rates. Unfortunately, a bad hire that doesn't put forth much effort (or isn't capable of performing key tasks) can tamper with the customer experience.

Let's take a look at an example. Suppose you are a physical therapist that runs your own practice.

Due to rising labor costs, you hire a virtual receptionist to check in with patients and help them schedule appointments and meet deadlines with insurance claims.

First impressions are everything — the first contact a new patient will have is with a receptionist (not you).

So if your new virtual receptionist is rude or can't help your patients with their queries, it could seriously impact their experience with your practice. Then they go home and tell all their friends and family to avoid your office.

It's the worst-case scenario. Why? Because not only are these bad hires impacting one customer experience, but it also impacts word-of-mouth referrals.

4. They can damage your company's reputation

A bad hire can directly affect your company's reputation.

Imagine you own a company that specializes in selling truck accessories. Hiring employees who have previous knowledge on this specific topic and know how to use these automotive parts is fundamental.

By offering a high-quality service, you'll demonstrate that your company is an expert on the subject and a leader in the industry.

On the other hand, if you hire an employee who knows nothing about truck accessories, your customers will lose faith that you are truly the expert in your niche. And they might not return for future purchases.

Also, a disgruntled employee can hurt your company if they write a bad review on a job hiring site like Glassdoor.

86% of people searching for jobs will research company reviews and ratings before applying. So now you have an added hurdle to overcome when you are looking to fill that open role that your bad hire left behind.

5. They can lead to a loss of productivity

A bad hire can lead to a loss of productivity in several ways.

The employee isn't a good fit for your company or job, and as such, they'll be less productive than someone seeking their dream position.

And, of course, a bad hire is infinitely less productive than an AI-powered chatbot in a customer service role.

In some cases, the problem might stem from the applicant's inadequate skills for the task at hand. If employees don't have the necessary experience or training, they'll likely struggle when performing their duties.

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This is especially important when hiring for remote roles. Employees working remotely must be able to work productively with little supervision. They must also have the ability to manage their time efficiently.  

Another way a bad hire can lead to a loss of productivity is through laziness. If an employee isn't passionate about what they do and takes little pride in their work (or lack thereof), then they won't put as much effort into it as somebody who cares about their career.

The lackadaisical attitude will cause problems related to quality control, costing time and money down the road.

Wrapping up

A bad hire is less productive, less engaged, and less happy at work. These people may not be as motivated to put their best foot forward and are more likely to leave the company before they've had time to make a difference.

A bad hire could also negatively impact the rest of your team by creating tension among employees who feel they were passed over for someone less qualified. And suppose the employee has poor work habits or doesn't mesh well with other employees' personalities. 

In that case, this could lead to low morale among everyone at the company, ultimately affecting productivity levels and turnover rates — which can have serious financial consequences on any company's bottom line over time.

Measure twice and cut once when hiring new people for your organization. The key is finding someone who's coachable and fits well with your company culture.

Finding the right employee for the job is worth the added effort. 

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About the author

Shane Barker is a digital marketing consultant who specializes in influencer marketing, content marketing, and SEO. He is also the co-founder and CEO of Content Solutions, a digital marketing agency. He has consulted with Fortune 500 companies, influencers with digital products, and a number of A-List celebrities.

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