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December 4, 2012

Failures due to Irrelevancy

Risk of having wrong people in an organization

Managing people and their work becomes easy if there are co-operating and performance oriented people in an organization. Simply hiring people with right skill and knowledge is no sure shot recipe for success. It might become a challenge, if the organizational hierarchy has people with skill, but low sense of responsibility and motivation. Such people are often termed as irrelevant or wrong people in the organization, who not just corrode the performance levels of the rest of the team, but also impact the organization as a whole. Such people, once hired, or promoted, can be a heavy cost to the company.

When one says irrelevant/wrong people in an organization, it could refer to many things. It could be people, who are low motivated, poorly performing or irresponsible with little or poor sense of delegating tasks. The worst is when such people are in some important profiles of the company, and end up adversely affecting the company performance.

Let’s take a look at the key effects produced by such people in an organization.

Time lapse

Having low skilled or irresponsible person in position, can be a feat. Such people eat up a lot of time in either getting trained, fitting into the organizational role or simply understanding their responsibilities. By killing time, they do not just lag behind themselves, but also impact the entire team’s performance. A team that might be doing well otherwise, will have to suffer because of the time lapse caused by one such person.

Impact revenue

In the presence of wrong people, an organization feels a strong impact on its tangible assets. Often the wrong or low motivated people, who take longer time to get trained, result in increasing the training costs of the company. This, therefore, hampers the revenue of the firm.

High cost

Sometimes, since the low motivated or poorly performing candidate is hardly able to contribute to the company’s revenue, his recruitment costs become a high cost burden for the company. Right from his cost of salary, advertising the job, consultancy to calculating the cost of re-training, depletion of the skill and loss in productivity, everything suddenly becomes a heavy duty expense for the company.

Intangible assets affected

Though a company’s tangible assets can be measured in monetary terms, but there’s no way to assess the impact of intangible assets. A person with a wrong attitude can fill the team with negativity by various ways. He could be bad mouthing or be highly critical of his work and his seniors or he can simply be demotivating others in his team, resulting in poor team performance. This behavior of such a person can also impact the loyalty factor of the other employees as well.

Affects team performance

People with bad behavior at important positions in the company may be deliberately attempting to harass or belittle their immediate juniors or team members. Their arrogance and annoying behavior can be disappointing to someone, who is keen on learning and growing the success ladder. The ego clashes or deliberate attempts to discourage can be ruining the chances of a good performance by someone.

Affects senior management level

Sometimes a demotivated or an irresponsible person at an important position in the firm can attract the attention of higher authorities or senior management in the company. This not only disrupts the work at his level, but also affects the functions of the senior management level as they too get involved in rectifying the error. Hence, restoring order in the organization takes a lot of their time and resources as well.

High attrition

Wrong people as in people who have either the wrong attitude or people with low qualification, both can lead to a high attrition rate in the organization. Factors like poor revenue generation, client complaints, reputation damage, high training or re-training costs can all be making a company resort to firing employees. Hence, such people are bound to be damage to the company in terms of high attrition rate.

Reputational damage

People, who are low on motivation and poorly performing, often lead to revenue loss for the company. The revenue loss owing to their under-performance, coupled with failure to handle responsibility earns a bad name for the company. Such wrong people can often be blamed for the company’s tarnished image.

Potential business loss

Critical people, often can bad mouth about a company and even break confidentiality codes. There is often the risk of leaking sensitive information by them, which can in turn result in poor brand name for the company. The company’s poor brand name can often result in potential business loss, where a firm might lose to expand its existing client base. Sometimes, customer loyalty also gets hampers, because of which the existing client base also gets affected.

Misuse company’s resources illegally

Irresponsible people or people with wrong intentions can even misuse company’s resources for their personal use. For instance, these acts could be to the tune of using company’s car for personal travel or company’s finances for personal use. This not just makes such people ill famed inside the company, but also of ill repute outside. His irresponsible and wrong intentions can make the company ill reputed or a failure amongst its existing clientele and can seriously affect the business of the firm.

Bad mouthing

Either people with poor skills or poor attitude, both have negative impact on the organizational environment. While the firm earns a bad name due to poor skilled people, the people with wrong attitude and wrong intentions contribute to the bad name directly. The latter often indulge in criticizing their work, their pay, their seniors and counterparts, thereby disparaging the firm.

The above mentioned factors hint at various ways in which irrelevant people can be a pain to the organization. Right from internal discrepancies to external damage, such poorly skilled or irresponsible people can wreak havoc in the organizational functions. They not just ill perform, but also bring about a lot of negativity, affecting the performance of others as well. The holistic growth of an organization is possible only when rightly skilled people, with the right dose of motivation and performance seriousness are aligned in the hierarchy of a firm. Hence, a series of tests, including psychometric tests should be used as a parameter to judge candidates at the time of hiring. Not just emotional discrepancies, but even a candidate’s fitment into an organizational role gets well highlighted in such tests.

Tags : risk factors associated with wrong people in an organization, wrong people in an organization

About Kanika

I have been writing for almost 3 years now for various clients