Why Should I Prioritize Cultural Fit When Hiring Employees?
October 14th, 2021
Very few actions are more important to the success of your business than hiring new employees. When you hire the right people, it can build long-term stability, push your company forward and set you up for success for years to come. Conversely, the wrong hire can set your company back significantly. Therefore, it’s crucial that you get these decisions right the first time.
While education, skill set, and work experience are certainly important factors to consider, they aren’t necessarily going to predict the success of a new employee. Obviously, it’s important that anyone you hire has the requisite background and skills to succeed at the position, but many aspects of a job, including some of the specific skills required, can be taught as part of the training process.
It’s a lot harder to teach someone how to cultivate many of the intangibles associated with success in the role. In general, these intangibles often involve how well an individual aligns with your company culture. Either people are a good cultural fit or they’re not. This has a lot to do with someone’s personality and work style – these aspects of a person are pretty much set and aren’t very malleable.
For this reason, many companies have found that prioritizing for cultural fit is the best way to ensure they hire the right people.
What Is Company Culture?
- Mission and vision – What are you trying to achieve as a company and how do you go about achieving these goals? This vision provides the context for many of your strategic and tactical decisions.
- Core values – What are the principles and beliefs that drive all of your organizational behaviors?
- Workplace atmosphere – Do you have a collaborative environment or a competitive environment? Is it a more formal or causal workplace? Do you encourage innovation and creativity? Is work-life balance valued or is there an expectation that everyone will work extremely long hours?
- Employee relations – What is the dynamic between your management team and the rest of your employees? Are the ideas of all employees valued and considered as part of the decision-making process? Are employees empowered to speak their mind and voice opinions that may not align with those held by their managers? Are employees treated with respect and made to feel appreciated?
- Approach to day-to-day processes – How is your company’s workflow organized? What systems have been created to ensure your employees are set up for success in what they do?
These items all mean different things to different businesses, which is what makes every company’s culture unique. The more clearly these items are defined, the more likely it is that you’ll be able to identify the traits that make a particular job candidate a good cultural fit.
It’s important to understand that a good cultural fit doesn’t involve finding people who all look the same, have the same personality type, share common political beliefs, or agree on everything. Building a team with diverse personalities and opinions is crucial to success, as this is the best way to ensure you hire people that will bring fresh ideas to your company. More diverse experiences will build a stronger team, provided everyone is aligned with your culture.
Why Does Hiring for Cultural Fit Matter?
According to a 2017 Leadership IQ survey which included responses from over 20,000 hiring managers, 46% of new employees fail within the first year and a half of employment. Based on the feedback from these hiring managers, an astounding 89% of these failures were associated with attitude or personality issues, whereas only 11% were due to lacking the skills necessary to perform the job.
Based on these statistics, it should come as no surprise that hiring for cultural fit has been a growing trend among businesses in recent years. There are several reasons why you should prioritize finding candidates who fit your company culture.
Employee Retention Improves
When hiring new employees, the goal is to find individuals who will stay with your company for a long time and grow with your business over time. This will create better stability at your company and ensure your team consistently possesses the skills and experience necessary to deliver the quality work your customers or clients expect.
A person who doesn’t align with your company culture is much less likely to stay long term. This will create higher levels of employee turnover, which results in a wide range of upheaval within your organization:
- It creates workflow issues, as other employees will be required to pitch in and complete the work performed by the individual who moved on
- It negatively impacts your overall productivity
- It may reduce the confidence your customers/clients have in your brand
Perhaps most importantly, high employee turnover significantly increases your expenses. When you add up all of the costs associated with employee turnover – recruiting and hiring expenses, onboarding/training costs, reduced productivity, and lost opportunity costs – it can be very damaging to your bottom line. Furthermore, the cost of replacing employees typically increases with the experience level associated with the position:
- Replacing entry-level employees costs 30-50% of their annual salary
- Replacing mid-level employees costs approximately 150% of their annual salary
- Replacing high-level employees costs approximately 400% of their annual salary
For these reasons, it’s crucial to keep employee turnover as low as possible. When you prioritize cultural fit, you’re much more likely to retain quality employees for the long haul.
Job Satisfaction Improves
People who don’t enjoy coming to work every day aren’t likely to experience much job satisfaction. When you hire for cultural fit, you increase the likelihood that you’ll have employees who love their job.
In general, people who are more satisfied at work perform at a higher level and are more productive than individuals who are miserable every day. When an employee has poor job satisfaction, it can create a distraction that not only impacts that person’s productivity, but also the productivity of other team members relying on that person to deliver high quality work.
Easier to Attract Top Level Talent
With an increasing number of companies moving to a remote working culture, competition for top talent is at an all-time high. Geographical barriers have been removed for many businesses, allowing them to hire the best people from all over the country. While providing competitive salaries and strong benefits packages will help attract top candidates, many individuals are also prioritizing working for a company where there is a strong culture.
If a top candidate has concerns over how they fit into the culture, they may be less likely to take the job, or they may not stay very long if they initially join your team. When the most talented candidates feel like they will fit into your culture, your job will not only be more attractive to them, but they are more likely to stay longer and enjoy the type of job satisfaction that results in their best effort every day.
Team Morale Improves
When you have an employee who doesn’t work well with the rest of your team, it can create negative energy that permeates your entire organization. Even when an employee produces good work, a poor attitude can create distractions for the rest of your team that can drag down everyone’s productivity.
In addition, people who bring a bad attitude or have frequent conflicts with other employees can create a negative environment for those who are a good fit with your company culture. This lowered team morale can potentially derail your culture and reduce the job satisfaction of your team, causing them to look elsewhere for the positive work environment they crave.
By hiring for cultural fit, you significantly reduce the likelihood of this situation arising. Overall, this will help you maintain high team morale, which will help you retain quality employees who are invested in the long-term success of your business.
Hiring New Employees Is a Significant Time Investment
We’ve already discussed many of the financial costs associated with hiring new employees. However, there is another cost associated with this process that will significantly impact your business – time.
The hiring process is very time-consuming, and it typically requires the participation of multiple team members who must spend hours reviewing resumes and participating in interviews. Once you hire a candidate, other team members will be involved in the onboarding and training process, which often can take months depending on the specifics of the job. The onboarding process can often involve many different teams who all need to provide the new employee with important resources to do their job well, including HR, IT, direct managers and team members, and executive team members.
With such a significant time investment for many existing members of your team, it’s crucial that you get the hiring process right the first time. As we mentioned earlier, poor cultural fit is the primary reason why almost 50% of new employees don’t last more than 18 months. Every time this situation arises, you’re forcing your team to experience the negative impact of this time drain once again. Therefore, it’s crucial to make sure your new hires will fit your culture before you offer them the job.
How to Hire for Cultural Fit
While there’s no foolproof way to identify how well a candidate fits with your company culture, there are some actions you can take to increase the likelihood that you get this aspect of the hiring process right:
- Clearly define your company culture – Define your company vision, mission and core values. Make sure this information is communicated to all employees and have your management team reinforce this culture to ensure company-wide buy-in.
- Reference your company culture and values in the job posting – Include a blurb about your culture in the job description so that candidates have a sense of whether they’ll be a good fit before they apply.
- Discuss your company culture and values during the interview process – Explain your culture to all candidates during the interview and explain any culture initiatives your company organizes in order to maintain a positive work environment.
- Ask each candidate pointed questions about how they align with each of your core values – During the interview, make sure you include questions that help you assess cultural fit. These should be more than just, “How do you feel about X value?” Instead, create hypothetical situations where the candidate’s response will give you a sense of how they align with your values.
- Get to know candidates on a more personal level – Interviews often focus on experience, skill set, and other aspects of their background that are directly applicable to the job position. After you’ve narrowed the pool down to your top choices, consider taking them to lunch or coffee to get to know them on a more personal level and see how their personality fits with your culture.
- Use pre-employment assessments – There are several pre-employment assessments that focus on personality profiles. These can be useful tools when identifying whether a candidate will be a good cultural fit.
- Focus on company culture during onboarding – Once you’ve hired a candidate, make sure the onboarding process reinforces the company culture. This will help all new employees internalize your core values, and it will improve buy-in.
Hiring for a cultural fit is significantly more time-consuming than simply evaluating a candidate’s education, experience and skill set. However, the time is well worth the effort and will pay huge dividends for your company. It will help increase the likelihood that you hire the right people who will be valuable members of your team for years to come.
Premier Employer Services Can Help You Hire for Cultural Fit
If you’re concerned that your team lacks the time, background or financial resources to conduct an extensive cultural fit hiring process, Premier Employer Services can help. Our team of HR consultants and employee engagement professionals has extensive experience assisting businesses of all sizes with the hiring process, and we can set you up for success.
Our Elevated Engagement Plus Approach™ is focused on helping you create a more successful and inspired organization. We achieve this by spending time with you in order to understand your specific workforce dynamic and any challenges you face with the hiring process. We’ll use this insight to create a customized hiring process that identifies the right candidates to fit your unique company culture, and we can help you construct an onboarding process that will make it easy for your new hires to assimilate into your company culture.
Contact us today to schedule a consultation. We serve clients in Denver and throughout Colorado.