KUALA LUMPUR: Mis-hiring can be a costly affair. And that’s what Verity Intelligence Sdn Bhd is trying to prevent.The company, which specialises in background screening for potential employees, new business vendors or partners, has managed to secure over 150 customers since it was established two years ago.
However, 90% of its clients are multinational firms. According to its founder and managing director Mark Leow, local firms still lack awareness with regards to verification, preferring to only perform background checks on senior level potential hires, resulting in severe repercussions when something goes wrong. “A lot of times, local firms don’t verify information or have this due diligence mindset. Usually, they only want to screen senior level hires. But infact, you have to do the screening at all levels, even for clerical staff, as they are exposed to company documents,” said Leow. “It is a challenge to get local firms on board because they don’t see the value in background screening and verification,” he added.
Without background screening, companies run the risks of having to face a costly firing and then rehiring exercise, explained Leow.Usually, head hunters will take two months of the employee’s salary as their fee while advertising for the position takes a month’s wage. If the candidate is found unsuitable, companies take another three months before terminating him or her. Leow says local firms still lack awareness with regards to the importance of verification “Before firing, you are required to provide training to the said employee for a month in hopes that he or she will improve performance. If it doesn’t work, it will probably take you another three months for rehiring,” said Leow.
All in all, he said companies stand to lose up to 10 times of the employee’s salary resulting from mis-hiring.Leow said Verity’s background checks go beyond local turf to include countries such as Singapore, the Philippines and China. As Verity built up its client base, Leow noticed that cases of falsified information have increased significantly. “We have discovered 50% embellished resume, that a lot of candidates lie about their previous position, the number of years they worked in the company and salary among others,” he explained. Verity also provides vendor verification services, where it checks the veracity of details of a supplier which is going to engage with its clients.
“We have managed to save our clients from dealing with fraudulent companies,” Leow said.Verity collects data that are available in the public space or through subscribed databases and even government sources. The company complies strictly with the Personal Data Protection Act where it would obtain consent from the candidate before doing the necessary background checks.“The work we do, anybody can do it. It’s about the data collected,” said Leow. Even so, Leow does not feel threatened by the potential of low barriers to entry.
“There will always be competition. But I think it is important to preserve quality of service and maintain good customer interaction. We benchmark ourselves with private investigation companies and other competitors overseas,” added Leow. The process of collecting data was handcrafted by Leow from scratch. “As an entrepreneur, you learn from many processes. Different businesses have different processes. You adapt from the best and create one that will suit this business.
Every year, we have process improvement review where we look at all the departments and see how we can enhance our performance,” explained Leow.Though the company only has 20 staff, it has huge aspirations and among them is to make its mark in Asean countries.This article first appeared in The Edge Financial Daily, on September 30, 2013.