Hiring is the most expensive experiment most companies run.
A bad hire costs 30–100% of annual salary in hidden costs — and the unwind is harder than anyone admits up front.
Hiring gets framed as a growth decision. It's actually an experiment — a bet that this person, in this role, with this team, will produce more value than they cost. Most of the time the bet works out. Sometimes it doesn't. And when it doesn't, the cost is a lot bigger than the salary line suggests.
The honest range on a bad senior hire is 30–100% of annual salary in hidden costs. Recruiter fees. Three to six months of ramp where output is net negative. Rework on the things they shipped before you realised. The opportunity cost of the work that didn't get done while everyone was managing the situation. Manager time spent on performance conversations. And then the exit — which, in markets with strong labour protection, can take months and cost a settlement on top of everything else.
None of this shows up in the hiring business case. The business case shows salary and expected output. The risk is invisible until it isn't.
The interesting move is to treat hiring like any other expensive experiment: try to de-risk it before committing. A short paid trial. A scoped project run with the person as a contractor first. A vetted external specialist doing the work for two quarters while you confirm the role is real and the volume holds. Any of these gives you 80% of the signal at 10% of the unwind cost.
Here's the test I use: before opening a permanent role, write down what you'd need to see in the first 90 days to know it was the right hire — and what you'd need to see to know it wasn't. If you can't answer the second question, you're not ready to hire. You're ready to gamble.