How to Improve Hiring Process for Better Employee Retention

Beatriz Boavida
Feb 26, 2024
3 min read

What if we told you that leaders are perceiving the hiring process in a wrong way?

What I mean by this is that typically (and rightly) managers and leaders focus their attention on attaining the best talent. And once the new employee enters the company the focus naturally shifts to training them and eventually promoting them to retain the employee.

Considering that a bad hire can cost a company an average of 17,000 US dollars, it is only logical to give such importance to the acquisition moment of the hiring process.

Nevertheless, according to Jason Fried – co-founder of 37signals, makers of Basecamp and Hey – perceiving hiring as something you do only once is problematic. In this article, we will dive deeper into Fried’s perspective on how you can improve your hiring process to effectively retain your best talent.

You hire someone twice

The first time you hire someone, it is to make them part of the company and, consequently, of the team. And that is all about finding the right mix of people for a diverse and strong team. For Jason Fried, one of the best tips you can use to predict if someone is going to be a good match for the role and the company, is when you get the feeling of “I can’t wait to work with this person” during the interview.

Then, 12 months later, if they are a match, you should hire them again. According to Fried, this second hire is utterly crucial and one that is often ignored.

How to know if you should rehire your employees

After 12 months, it is common for performance reviews to take place. But these moments are not equivalent to a second hire, as they are process-oriented and not actually clarifying.

For Jason Fried, feedback methods like performance reviews and 360 feedback do not lead to the most clarifying insights without being too time-consuming and jeopardizing employee engagement. A Gallup study even found that only 14% of employees strongly agree their performance reviews inspire them to improve.

As a leader, you know if someone is great for the company within the first few months. During that first year, Fried postulates that it is crucial to do regular check-ins, a 90-day review, and multiple 1:1 to build alignment, which should be especially frequent in the beginning. So, when the time comes, you have enough insights already to answer a really simple question:

“With a full year behind me, knowing what I know now, would I hire this person again?”

This is Basecamp’s approach. It allows you to address the real issue with clarity: You, as a leader, have two options:

When you are unsure, the answer is most likely NO. Either it is a 100% “Yes, I would hire them again.” or it is best to move on.

Once the 12-month mark comes up, it is also critical that employees question themselves: “Knowing what I know now, would I take this job again?”. They should choose the company as much as you choose them. 

How to know if an employee is still the right choice as their career progresses

At this point, you may be questioning “Do I need to keep asking this question every year and make rehiring a regular process?” – No. But, according to Jason Fried, you should keep asking questions to assert if the person is the right choice for the company.

One question you can ask is: “Is this person progressing beyond where they were?”. Remember that not two people are the same, especially regarding their ambitions and motivations, and that it is healthy for a company to have diverse and mixed teams. As Fried puts it: “You want some people that are really hungry and some veterans who know how this place works inside and out”.

Key takeaways

To improve hiring process, you should change your perspective to YOU HIRE SOMEONE TWICE. As important as it is to ask yourself if a person is a good match for the company after the interview process, it is equally necessary to ask yourself if you would hire them again after that first year.

For you to have such clarity and confidence in your answer, plan to include regular check-ins, a 90-day review, and multiple 1:1 – and make them especially frequent in the first few months.

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