How HR Leaders Can Drive Double-Digit Business Growth Using AI

Most companies are stuck using AI to improve hiring efficiency, missing the exponential value creation opportunity of transforming both their hiring channels and methods. This 'double-double' transformation shifts HR from process automation to true value creation and bottom-line profit impact.

This is a fascinating story. There's a lot of data analysis involved but it's a good example of how AI can be used to optimize hiring processes and improve business profitability. This is why "Thinking Like a CFO" needs to become the next HR super skill . More important: AI can make it happen when massive ROI goals are driving the change, not cost savings and efficiency. (Caution: Claude did this analysis and it's directionally correct but needs to be validated for your own unique situation.)

First, I asked Claude AI to evaluate the hiring effectiveness of these five different sourcing channels: job boards, internal mobility, networking, direct sourcing and third party recruiters for two classes of jobs: hourly and gig workers and professional and managerial. Here's the full analysis including all of the assumptions and why it didn't like job boards based on turnover and performance. Claude also generated this table summary.

I then asked what would happen if we first optimized the sourcing channel mix and then used Performance-based Hiring to minimize hiring mistakes and improve job satisfaction . Here's the summary of the analysis it created but it's clear that the impact of the channel mix is profound.

How HR Can Generate $18 Million EBITDA Per Year per 100 Hires

The business case is compelling: better hires, faster productivity, higher retention, and a 97% increase in value per hire. For organizations ready to transform their hiring practices, the return on investment is both significant and rapid.

Finally, l asked Claude to calculate the financial impact of implementing this double-double hiring strategy for 100 new hires in the Professional and Managerial Category. We assumed an average base salary of $150 thousand for these people for a total annual spend of $15 million.

Here's what it concluded:

For companies making 100 professional hires annually at $150K each ($15M base payroll), implementing a "double-double" hiring transformation - changing both where and how you hire - dramatically improves financial performance. By shifting from traditional job boards to high-performing channels (internal mobility and referrals) and implementing performance-based hiring practices, companies can increase their annual profit contribution from $18.6M to $36.7M - an $18.1M improvement. This near-doubling of value comes from better quality hires, higher retention, and faster productivity ramp-up. The business case is compelling: better hires, faster productivity, higher retention, and a 97% increase in value per hire. For organizations ready to transform their hiring practices, the return on investment is both significant and rapid.

Lou Adler?is the CEO and founder of Performance-based Hiring Learning Systems – a consulting and training firm helping recruiters and hiring managers around the world hire more outstanding and diverse leaders. Lou is the author of the Amazon top-10 best-seller, Hire With Your Head (John Wiley & Sons, 4th Edition, 2021), The Essential Guide for Hiring & Getting Hired (Workbench Media, 2013) and LinkedIn Learning’s Performance-based Hiring video training programs.