The hidden costs behind a bad hire

When we consider the costs related to a bad hire, we tend to monetise financial costs. These may be high, but a bad hire becomes more damaging for the company when we consider its impacts in other areas.

Sure, the financial costs of a bad hire can cause a restraint for the company. Depending on our geographical location and the seniority of the employee, these can range from 25-50.000€ to over $200k. These include the potential revenue lost, as well as the resources invested in the recruitment process and the new hire’s onboarding and training.

If the financial effects of a bad hire weren’t enough, there are other impacts we should not omit –

The effects of a bad hire


New hires receive the same salary as any other employee who has already been onboarded and performing as expected. This is acceptable because the company assumes that this person will match that performance over time.

However, what happens if this person turns out to be a bad hire? 

We’ve invested resources in their training but haven’t received anything in return. These resources may be financial, but let’s not oversee the time invested in their training and onboarding throughout different teams.

Unmet company/team goals

The recruitment strategy is paired with the team or company’s objectives. With a bad hire, we must initiate the whole process again, meaning that the recruitment timeline is stretched and it might be too late to achieve our goals by the time a new hire is onboarded and reaches the break-even productivity point.


Employee satisfaction & rotation

Whilst looking for a new hire to fill the vacancy, and probably during the first few weeks/months of their onboarding, someone else will have to take over some of the work. This may cause burnout amongst existing employees and general dissatisfaction with the company. 

This is just part of the issue. Colleagues usually spot a bad hire before managers do. It can be upsetting to see how someone else in the team is being invested in when they are not a fit with the role/company for starters.

Burnt leads or lost clients

When discussing a sales role, that person represents the company. If they didn’t perform well, it is probable that the leads they worked with may now be lost. The same happens with roles dealing with existing clients. 

Reasons for a bad hire and how to avoid one

Let’s consider the main reasons behind a bad hire. As you’ll notice, most of them are easily avoidable when building a sound recruitment strategy.

Unclear job description

Before even posting a job ad, we must make sure we understand the role and its requirements. Both the hiring manager and talent acquisition teams must be aligned on the definition of the profile. This might seem obvious but, believe us, it is fairly common that each team prioritises different aspects. 

Rushed process

Determine when the new hire needs to be onboarded so the team’s goals can be achieved. Work backwards and determine when the recruitment process needs to start. 

Finding the right person can take time. So try to do all you can so you don’t rush into an inappropriate decision.

However, be as agile as possible when you find the right candidate. All companies are hungry for talent so the longer you wait, the higher the chances of the candidate receiving and accepting another offer.

One-way interviewing

Prepare for the interview so that the candidate covers all your doubts. Have a clear list of your main requirements so you can evaluate them objectively.

Allow for additional time at the end of the interview so the candidate can also ask questions. This is their time to shine, but it can also raise red flags. So let this play to your advantage and take this as an opportunity to know more about the candidate.

Little knowledge about the market or role

When unsure about either, ask for advice.


Seek the expertise of a specialised recruitment agency that can guide you through the current situation in the market. 

Maybe the profile you’re looking for doesn’t exist. Or maybe you should be prioritising other aspects of the role. 

The bottom line

The impact of a bad hire goes much further than its financial effects. It can also affect the team’s spirit, your reputation with your existing or potential clients, and it may even break your team. 

There is always a chance you’ll make a bad hire, but there are ways of minimising the possibility of this happening. Be quick to react and don’t shy away from seeking external advice. 

Interested to know more? Here’s a list of the main mistakes in recruitment.

Want to read more fresh content about the role of an SDR and sales teams? Check out more articles.