You have the idea. You have the MVP. And now you’ve got the funding. Now, how about getting the people? This is the challenge that most of us are struggling with. Launching a new series called “How to Hire Better”, where we will be talking about how to smoothen out your hiring process to reduce candidate dropout, and share our hacks that may help you too.
Starting with something to tackle the biggest pain today- Offer Shopping & Dropouts.
How to reduce Candidate Dropout via Offer Shopping
Today the market is hot, and everyone is looking to hire – in fact, there is almost a talent war going on, especially for popular skills on the IT/UX/Data as well as Digital Marketing & Product Management side.
After many rounds of interviews, conversations, and negotiations, you are finally successful in identifying someone who fits the bill. You’ve gone ahead and made the offer. With a strong EVP – the Employee Value Proposition. So you add ESOPs, flexible timing, BMW bikes, a ticket to the moon, everything. And the candidate has said yes!
So now, of course, you’re feeling on top of the world. Or almost. But, there is a niggling worry at the back – will the candidate actually join?
Because, today the unfortunate reality is that most candidates dropout after offer acceptance. The situation is bad. Real bad.
But while it’s always good to be able to laugh at your problems, you have to have a solution too.
While there is no way to be certain, there are a few things that we have tried that seem to work –
Look for Short Joiners only to reduce candidate dropout
This is something which everyone does, and it is actually the best way of increasing your offer to joining ratio. And the difference is stark – in September, we had 208 offers across our clients for tech roles, out of which around 108 were candidates with a notice period of less than 15 days, while rest ranged from 15 to 90 days (Yeah, 90 days’ notice is still a thing, don’t ask us why). We found that among short joiners, we had over 70% people joining, whereas for those with more than 15 to 30 days, it dropped to below 25%.
And above 30 days – out of 11 candidates whose joining date has become due till now, not even one person has joined. Yes – Nada. Zilch. A big fat Zero.
This happens because a shorter joining period gives the candidates less time to shop around for other offers. In fact, if possible, you should pick candidates that have shorter overall notice periods. It would be ideal if the candidate is already serving their notice, i.e. they have already put in their resignation. However, rule of thumb is, the shorter the time between them accepting the offer and joining the organization, the better.
Long story short – Focus on Short Joiners to get the best results.
But then what do you do if you like people who still have a long notice period to serve? You are not going to fill all the positions from short joiners, and many critical, senior level roles will necessarily mean a long notice period. Try the next points to reduce candidate dropout in these cases.
Give out the final offer letter closer to the joining date
This is a strategy that you can use for candidates who have already resigned but have a long time still to join, but makes sense even for people who can join next week. It is something we have been pushing our clients and friends to do, and it’s giving decent results in terms of reducing candidate dropout after offer acceptance.
What you need to do is,even when you like the candidate, you release the final offer as close to the joining date as possible, and only after considering the highest offer they hold at that stage.
This will drastically increase the chance of the person joining you, as they are at the end of the notice period and (usually) out of time to look further. Of course, this assumes you are giving an offer topping the ones they already have.
The benefit of a delayed final offer letter is not just that your joining ratios will improve drastically, but it will also improve your hiring funnel, making it much stronger.
In the traditional approach, when we offer the job to one candidate, we slow down the process as we cannot typically offer the job more than one person for the role. So we tend to keep a couple of backups somewhere on the backburner, and keep our fingers crossed, hoping for the current person to join.
Whereas this approach allows you to have multiple options ready at the last stage, and you just make an offer ASAP to a person who is ready to, and likely to, join.
Offering Paid Engagement
In case you like a person who has not yet resigned and would do so only after your offer, or ifyou’ve provided the offer letter already, but the notice period is long, don’t worry. There is still another strategy you can use to keep your candidate interested and improve the chance of them joining your organization.
This is by offering them a paid engagement, something on which they can spend maybe 2-3 hours a week, which will get them engaged and invested in your company and their role from the get-go.
For example, ask them to assist on a project before joining. Clarify that this is a paid project and they will be compensated for it on joining. Make sure that it is an actual task that they will be supposed to work on, else instead of creating an engagement it will put them off.
The benefit here too, is manifold:
- The project makes them invested in your company, and their role. They are more likely to look forward to joining.
- They are already working with your organization, which will help them hit the ground running.
- It will help them, and you, assess each other much better, and so if the time comes when you have to re-negotiate the offer, you know what you are getting.
In case the candidate declines the engagement or slacks of after an initial enthusiasm, you know the chances of joining are slim and you keep looking. But if it works out, great! This is a true win-win, as the candidate benefits equally.
Hopefully, these tips will help you reduce your dropout ratio while also strengthen your pipeline.