Got talent? You're in demand

The war for talented workers is heating up in corporate America.

Managers face competing pressures in recruiting: the upcoming retirement of the baby boomers, low unemployment and the high costs of training new workers.

The pressures are forcing companies to spend more energy on making the right hiring decision from the start because they know that the wrong one can hurt morale, lower productivity or cause embarrassment for years to come.

Making the right hire also pays off because a poor choice is costly. As a general rule of thumb, it costs a company twice the annual salary of departing employees to replace them.

Besides traditional methods such as vetting résumés, checking references and conducting extensive interviews, some employers are relying more on online personality tests and other assessment tools to make hiring decisions.

Most often the final decision comes down to whether managers think a job candidate will mesh with the company's culture.

The hiring process has "gotten a lot more attention because there is a war for talent," said Clay Parcells, of Right Management, a consulting and outplacement company. "Baby boomers will be retiring very shortly. Employers want to make sure they attract the right type of talent who could fit well in the organization and grow, develop and continue to help the company be successful."

In a recent survey of 444 companies conducted by Right Management, 68 percent of respondents said a decline in employee morale was the biggest consequence of making a bad hire. Decreased work productivity was listed by 66 percent of respondents, according to the survey.

At W.L. Gore & Associates in Newark, Del., recruiters follow a rigorous interview process to find the right employees to fit into their culture.

The company — known for making Gore-Tex waterproof fabric — has no chain of command or titles.

Employees are known as "associates" and don't report to bosses but are accountable to each other. The company employs about 7,000 workers globally, including engineers, a sales team, marketers and others.

Barbara Pizzala, Gore's recruiting leader, said an interview team representing different departments evaluates a candidate's job experiences and how they achieved their professional goals. References also are checked.

"When you bring somebody in who doesn't function well in our environment, it has a ripple effect on the entire team," Pizzala said.

Bad-hire consequences

A bad hire at the executive level can cause embarrassment for the company. Dale Winston, chief executive of Battalia Winston International, an executive search company, pointed to the recent resignation of RadioShack Chief Executive David Edmonson, after an education qualification on his résumé was questioned.

Employers use intelligence and personality tests as well as role playing and problem solving to test a candidate's skills.

"You're seeing more people doing testing that helps with trying to predict who could work well with others, in teams and with diverse or global audiences," said Joyce Russell, a teaching fellow of management and organization at the University of Maryland.

Unicru, an employment-testing company in Beaverton, Ore., has seen its business grow over the past several years, in part because companies increasingly are looking for more efficient methods to find the right people for the job, said Kevin Tate, the company's senior director of marketing.

Unicru uses online tests to assess a job candidate's personality and work behavior.

But Lewis Maltby, president of the nonprofit National Workrights Institute, said employment tests should not "usurp human judgment."

"There's something wrong when the test runs the hiring process," he said.

The U.S. Department of Labor Employment and Training Administration offers a how-to guide for employers, which provides suggestions about the value of certain tests as well as a summary of federal laws governing the workplace.

With skills and education being equal, employers, human-resource experts and recruiters agree that a candidate's potential fit with the company's culture should be a key factor in hiring.

"Unless you're trying to change your corporate culture, you have to hire someone to fit in the corporate culture or risk disruption," said Brendan Courtney, a vice president of professional services at Spherion, a recruiting agency.

"If it's a laid-back office environment, don't hire someone with a strong personality. If it's an office where you need to be quick on your feet to survive, don't hire a laid-back person."

For small businesses, finding and hiring the right people is especially crucial, said Rick Corcoran, one of four owners of Let's Dish, where consumers assemble their own meals, which often are frozen and then cooked at home.

"It all starts with recruiting and hiring. If you get the right person, they do a great job. They're happy and they stay," he said. "If you get the wrong person in, they're unhappy and they leave. You wasted time in training them."

Recruiter's focus

At Gore, the hiring process is centered on whether a prospective employee would succeed in a culture that emphasizes teamwork, self-direction and hands-on work, Pizzala said.

She acknowledges that the process isn't always easy since prospective employees often come from traditional, hierarchical workplaces.

And mistakes have been made, Pizzala said.

But when the right person joins the company, "you have people who love to come to work and don't want to leave," Pizzala said.

"They're very loyal and they stay a long time."