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Linda Nazareth

December 14, 2015 by Speakers' Spotlight

Would You Rather Hire a Superstar or Avoid a Toxic Employee? (Think Hard Before You Answer)

The world we live in is morphing into a new one as we speak—that’s a scary prospect for many, but after a presentation by Linda Nazareth, you will feel like you have a handle on the future. The Senior Fellow for Economics and Population Change at policy think-tank The Macdonald-Laurier Institute, Linda is an expert in demographic and economic trends. Her talks focus on what will happen—and what you need to think about to be on the right side of change. Below, Linda looks at the importance of hiring reliable staff when it comes to the bottom line:

Would you rather hire a superstar or avoid a toxic employee? Based on their hiring practices, many companies are clearly choosing the former. A new report, however, suggests it would be in their best interest to focus on avoiding bad hires rather than concentrating on luring in superstars.

Here’s a theory: maybe business productivity is focused too much on finding the perfect employees rather than just avoiding the really bad ones. According to a recent working paper from the Harvard Business School, companies’ efforts might be better spent on not hiring toxic employees rather than on hiring superstars.

As detailed in this article from the Harvard Business Review, study authors Dylan Minor and Michael Housman looked at the cost to companies of hiring otherwise skilled employees who engaged in egregious behavior – things ranging from sexual harassment to workplace violence or fraud – as compared to the benefits of hiring superstar high-performers. What they found was that avoiding a toxic employee could save a company $12,500 in turnover costs, while bringing in a superstar only added about $5,300 to a company’s bottom line.

Anyone who has spent any time in the corporate world probably knows what a search for a superstar is like – and probably knows what working with someone toxic is like as well. The superstar search can involve months of searching and interviewing, taking up the time of everyone from the hiring manager through to external search firms. There is a lot involved in getting the right ‘fit’ and time is spent in making sure a candidate has the correct skills for the job. These days, when companies typically feel they do not have the time or resources to train new hires, the focus is often on matching candidates to a very specific list of skills and attributes.

The toxic employee, of course, may well have the skills a company is looking for, and may actually shine in the interview process. From their sample, the study authors found that charismatic, confident, productive and rule-following employees were more likely than others to be toxic employees. Given that those characteristics make an interviewee look good, which augments their chances of being hired. What separates toxic employees from others, however, is that they tend to get low grades in ‘corporate citizenship’, which can loosely by defined as ethics. That is not something that is necessarily explicitly screened for in the interview process, or even valued particularly highly by companies. Clearly, however, it is worthy of some consideration.

These days, as any company will tell you, the bottom line is everything and no one can afford to have anything but the best employees. While screening for the best, however, companies might want to think about expanding the characteristics they need in their staff – and in the process also avoid the worst ones.

Linda Nazareth/December, 2015