A Magical Formula That Virtually Eliminates Turnover

A Simple Hack for Reducing Turnover by 50%

Before making an offer, ask the hiring manager what the performance objectives are for the role and why the candidate is qualified and motivated to handle them. In parallel, ask the candidate if he/she understands the key performance objectives for the job and why they represent a career move.

Don't make an offer if their answers are vague, inconsistent or superficial. If so, the chance of the person leaving voluntarily or being terminated in the first six months is over 50%.

Getting to Yes

Getting a "yes" to both questions and eliminating turnover starts when writing the job description by defining success as a series of performance objectives, not a list of skills, experiences and personality traits.

Employee turnover isn't just a macro-economic challenge costing organizations billions annually - it's a devastating micro-level problem that impacts teams, hiring managers, and individuals in profound ways. The true cost of a mis-hire typically runs 2-3 times the person's annual salary when you factor in lost productivity, team disruption, and missed opportunities. Worse still, organizations often compound these losses by hoping poor situations will improve, which they rarely do.

"Hire Slow or Fire Fast"

But what if we could avoid these situations altogether? It turns out a magic a formula has emerged that could transform how companies hire and retain talent, addressing both the macro and micro dimensions of hiring success. As shown in the formula above, performance is driven by a critical relationship: how well a person's abilities align with job fit is the driver of motivation. And because motivation is so crucial to success, it's raised to the power of N in the equation.

The Puzzling Disconnect in HR Leadership

Perhaps the most baffling aspect of current talent management practices is how HR and Organizational Development leaders continue to treat hiring and performance management as separate domains. Despite investing millions in sophisticated applicant tracking systems, assessment tools, and performance management platforms, most organizations maintain an artificial wall between pre-hire selection and post-hire success metrics.

This oversight defies common sense.

How can we effectively predict performance if our hiring criteria don't align with how we measure success after hiring? It's akin to using different measuring systems to build and evaluate the same product. Yet this disconnect persists in even the most sophisticated HR organizations.

The solution is remarkably straightforward: embed post-hire success using Gallup's Q12 metrics into the pre-hire process. Instead of abstract job requirements like "5 years of marketing experience," Performance-based Hiring uses concrete outcomes: "Launch and execute our Q2 product campaign achieving 20% market share within 6 months." This simple shift transforms hiring from a subjective art into a predictable science.

Why Motivation Gets an Exponential - and Why Fit Determines Its Power

The formula's strength lies in recognizing motivation's exponential impact by raising it to the power of N.

But here's the crucial insight: the value of "n" itself is largely determined by the fit factors. This means that the exponential power of motivation - its ability to multiply performance - depends primarily on how well the person fits with the job, culture, and manager.

This mathematical relationship captures what great leaders have always known: highly motivated people often achieve extraordinary results, but that motivation cannot be sustained without proper fit. When fit is poor, "n" diminishes, and even initially high motivation will decay over time. Conversely, when fit is strong, "n" increases, creating a powerful multiplier effect on performance.

Understanding that fit largely determines the value of "n" transforms how we think about hiring. It's not enough to find highly motivated candidates - we must ensure the fit factors are strong enough to sustain and amplify that motivation over time.

The Path to Zero Turnover

Performance-based Hiring dramatically reduces voluntary turnover by fundamentally aligning ability, fit, and motivation from the start. When candidates are evaluated based on their demonstrated ability to achieve specific outcomes, rather than just meeting requirements, they're naturally placed in roles where they can excel. For example, instead of hiring a project manager for their years of experience, the focus shifts to whether they've successfully delivered similar projects under comparable conditions. This alignment, combined with careful attention to management style and cultural fit, prevents the friction that typically leads to turnover. By defining success metrics upfront, both employer and candidate have clear expectations about what constitutes outstanding performance.

The Bottom Line

The formula at the heart of Performance-based Hiring isn't just another hiring tool—it's a fundamental reimagining of how abilities, fit, and motivation interact to drive performance. By recognizing that the relationship between ability and fit drives motivation, and that motivation has an exponential impact on success, organizations can create a hiring process that naturally selects for long-term performance and engagement.

The question isn't whether this approach works—the mathematics and real-world results prove it does. The question is: how long will organizations continue to ignore these crucial relationships when a proven solution exists?

This article explores how the Performance-based Hiring methodology's core formula can transform talent acquisition and retention outcomes. The approach integrates post-hire success metrics into pre-hire processes, creating a seamless connection between selection and performance.