How Do You Measure Quality of Hire?

I love it when I am asked questions about specific metrics in HR. I was asked two times last week about Quality of Hire. I think this metric is getting more and more momentum as it should. If you think about the QUALITY of your talent...you instantly can make a direct connection to revenue and bottom line results: (Let's define a quality hire is one that is productive, committed, and engaged)

1) The more talented and engaged a person is, the more they will produce adding to the top line

2) The better your hires, the lower your recruiting costs

3) Employees that are more committed, give better customer service leading to increased loyalty, sales and repeat business.

So, with the impacts listed above, it makes sense to keep a pulse on the quality of hires we make. That begs the question...."How do you do that?"

A few months ago, I had a very different opinion on how you measure quality of hire. I thought that measuring performance at certain intervals would give you the definitive answer to the quality of hire question. In reality, it gives you a one dimensional look into the process. We really need to look at various metrics to truly see the whole picture. Thanks to Darren Shearer, from SuccessFactors, he suggested at a HR Metrics Conference, using a quality of hire index which would include the following components:

1) New Hire Stay Factor

2) Engagement

3) Performance Data/Productivity Curves

I like this approach as it tells the whole quality story. What are your thoughts regarding quality of hire. Do you measure this? If so, how?