A couple of years ago, I had the opportunity to work with the creators of Topgrading, Brad and Geoff Smart. Together, we created a DVD product that explains how to use a number of different hiring and recruiting best practices that are key to Topgrading.

In an interview (CNBC has removed the video from their website) with Ted Bililies, the Managing Director of Geoff’s company, ghSmart. Melissa Lee, the CNBC reporter, explains how private equity companies routinely engage with consultants to provide a second opinion assessment of planned hires.

At the end of the video, Melissa remarks: $25-35K for evaluating 2 to 3 candidates is a rounding error when talking about multi-million dollar deals!

One of the biggest problems in talent selection is that people fall in love with a candidate. Maybe they are good looking, went to prestigious universities, or worked for several great companies. A persuasive candidate may be great at making you fall in love with them, but not as good at delivering the results you are hiring them to produce!

You probably aren’t putting multiple millions at risk with one hire. Still, making a bad Senior Management hire can cost you $1M or more when you consider lost market momentum, opportunity cost, and disruption on top of the costs of replacing the bad hire, severance, etc.

Isn’t it wise to get a good Second Opinion Assessment when you’re making a key hire? I think Melissa Lee is right — It’s cheap insurance. What do you think?