Learn about Crosschq QoH 2.0 with this short introduction.
What is QoH?
Quality of Hire (QoH) is a concept similar to other human resource (HR) terms, such as Employee Experience, Leadership Potential, and Customer Service. While these terms are often discussed as if they represent a singular idea, they can be defined and measured in multiple ways. The multidimensional nature of QoH is one reason it is hard to manage, and why it is often overlooked despite its impact on workforce performance and HR operating costs.
Quality of Hire (QoH) measures the value that recruiting teams bring to an organization by sourcing and hiring impactful talent, scored between 0 and 100. It is used to evaluate how much a new hire contributes to the organization’s long-term success.
Employers who actively measure Quality of Hire are able to make better hiring decisions and impact their company’s ability to realize its business goals.
It allows HR to focus their hiring efforts and resources on candidates that will bring the most value to their company in the long term and allows hiring managers to set new hires up for success.
Among many others, QoH can be used to answer questions such as:
- How effective is my recruiting process and hiring team at identifying and selecting the right talent?
- What key characteristics and skills uncovered in the pre-hire process are most highly correlated with top performance?
- What was the quantitative impact of a hiring process change or new onboarding structure on new hires' time to ramp?
Index
How does Crosschq calculate QoH?
Quality of Hire Inputs
The image below shows the Crosschq Q4 model, which Illustrates variables that can be used to define and measure QoH. These variables are divided into four categories:
- In-role performance. The degree to which new employees fulfill their job's fundamental tasks and responsibilities.
- Extra-role performance. The degree to which new employees exceed expectations by finding ways to contribute to the organization beyond their core job responsibilities.
- Self-development. The degree to which new employees invest energy into building capabilities to advance their careers beyond their current jobs.
- Tenure & Turnover. The length of time employees stay with the organization and the reasons for their departure.
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There are two key reasons for categorizing QoH variables into these four groups:
First, the significance of each category can vary depending on the specific job role. For instance, self-development plays a crucial role in positions designed to cultivate talent for promotion into higher-level internal roles. Conversely, in roles where the primary aim is to address immediate operational needs, self-development may be less relevant, especially if there is little expectation for employees to remain with the organization over the long term.
The second reason is that QoH variables are influenced by different factors. For instance, elements such as competitive pay rates, work commuting distances, and flexible scheduling significantly impact Tenure & Turnover. In contrast, these same factors have a lesser effect on In-Role Performance, which is more closely related to aspects like the skill levels of new hires, the quality of training they receive, and the effectiveness of managerial coaching.
The following table lists metrics that can be used to measure QoH variables in each of the four categories in the Q4 model. The metrics are divided into objective and subjective data:
- Objective data reflects tangible actions or outcomes that are tracked in business and HR technology systems (e.g., turnover data from payroll systems, and sales data from CRM systems).
- Subjective data reflects opinions or judgments that are entered into survey or HR platforms (e.g., manager ratings of performance, termination reasons entered by HR professionals).
So, how is QoH calculated?
Within the Crosschq Insights platform, QoH is calculated as an indexed "retention-weighted performance" score throughout the new hire period.
What this means is that QoH is a function of different data inputs collected from employees, which were previously referred to as metrics.
In other words, organizations define their own Quality of Hire (QoH) models based on what they consider important indicators of quality. They can also assign different weights to each input. For example, if a model includes retention, performance, and quota attainment, and performance is deemed more critical than quota attainment, the Crosschq model can adjust the input weights, giving performance a greater impact on the overall QoH score compared to the other inputs.
QoH Models
Qoh is flexible and capable of measuring QoH for both individual employees as well as calculating larger cohorts: Many organizations start with a general corporate model that focuses on key metrics like tenure and performance to assess Quality of Hire. However, it's common to also develop role-specific models tailored to different departments. For instance, in sales roles, companies may measure metrics such as quota attainment or pipeline generation. Similarly, for customer-facing roles like call center or customer success, metrics might include customer satisfaction scores or ticket resolution rates.
In other words, organizations are not limited to a single model — we can implement multiple models for different roles or functions. Most companies begin with a general model, then expand to role-specific ones as they gain more organizational support for Quality of Hire as a key metric in optimizing recruitment.
Retention Model
The retention model returns a score between 0 and 1 for an employee in a given month of employment (period). There are three premises of the retention model:
1) Periods in which a new hire is employed are more valuable than periods in which a new hire is terminated. Employed periods are fixed at 1.0, but terminated periods' value can be customized (defaulting to zero).
2) Future (unobserved) periods are more valuable than terminated periods but less valuable than employed periods. As such, we employ a kind of discounting rate much like a NPV calculation, designed to reflect the probability of termination in a future period.
Put simply, we assume a uniform monthlyRetentionProbability which is one minus the probability that a new hire will churn in a single month during the new hire period.
As an example, if this probability is 95% (the default), then the first unobserved month has a retention value of 0.950 while the third unobserved month has a value of 0.857 (=0.95^3). Note that this parameter can be estimated from the data once a sufficient number of employees have been assigned to the QoH model.
3) If desired, the QoH Model can be configured such that not all terminations are treated equally. Specifically, the termination being voluntary (on the part of the employee), regrettable (on the part of the employer), and the termination being for cause can be treated differently.
This flexibility is especially important in the context of a retention-only QoH model as it gives more variance across employees when non-retention post-hire outcome data are unavailable.
Input Model
The input model returns a value between 0 and 100. Simply, it is a relatively simple weighted arithmetic mean. Each input has its own weight that is uniform across time. A weight of zero is akin to excluding that input from the model, while a weight of infinity is akin to only including that input.
Prior to being fed to the QoH model, missing data are backfilled, and future (unobserved) observations are predicted based on the average of observed data.
The following tables help to better visualize how the Retention and Input models work. The first table shows an employee in their 4th month of the New Hire Period, while the second table displays the QoH of an employee who was terminated during the New Hire Period.
New Hire Period
The New Hire Period (NHP) refers to the time frame in which a company evaluates a new hire's transition into their role. It can be viewed from two key perspectives:
1. Recruiting Team Responsibility:
During the first 1 to 6 months, the recruiting team remains accountable for the new hire's success and outcomes. Early in this period, employees may express concerns such as the job not aligning with the initial description, unexpected commute times, or other unmet expectations. After 6 months (and up to 12 months), responsibility shifts more to other departments, as issues like inadequate resources or unclear processes may arise, impacting performance.
2. Expected Productivity:
The New Hire Period (NHP) also defines when the company expects the employee to reach full productivity. This timeline varies based on the role and the organization’s specific expectations.
Typically, the NHP lasts for 3, 6, or 12 months. To determine the appropriate NHP for your organization, ask: "Do I expect my employees to deliver tangible results that drive business outcomes within 3, 6, or 12 months?".
You can define different New Hire Period for different cohorts (QoH models).
Moderators & Lookback period
Moderators help you slice and dice your QoH data for a more in-depth analysis of your company's QoH.
Review the Lookback Period & Moderators article to learn more.
How does Crosschq obtain the information to calculate QoH?
The Crosschq Intelligence Platform seamlessly integrates with a variety of ATS and HRIS systems, allowing you to effortlessly pull your employee and candidate information. Explore the Crosschq Connectors here.
If your ATS/HRIS is not listed among the Crosschq Connectors, you can easily upload your data into Crosschq using our CSV Uploader.