Insights into the forces shaping our industry.

Thin Slicing

Hiring Advice

by Ted Konnerth

It’s a fascinating process to help client companies find key talent. It starts with the ‘needs analysis’; which is roughly akin to designing Superman. We’re advised that a degree is required; with a minimum accum. MBA highly preferred, they have to relocate, they have to be within a compensation range, must have a specific or minimum number of years of industry experience, they have to pass drug tests, psych tests, personality profile tests, have a clean driving record, no criminal record, have strong leadership skills, have experience managing a certain size of business, etc. Some clients even imply we should narrow it to a specific age band; which is of course, illegal and dismissed by us.

Recruiting is a process of setting ‘filters’; every item listed above is another filter, which means the size of the talent pool has to be large enough to provide qualified candidates who survive all of the filters. Realistically, the talent pool and employee/employer relationships have changed since the ‘shopping’ days of the past. The sheer number of eligible bodies who can step into senior or management level positions right now are short by 10,000,000 between Baby Boomers and Gen X. Despite the Great Recession, there simply aren’t enough people to fill the growing openings of the departing Boomers; who have officially begun to retire. So why create a ‘job description’ that effectively eliminates most qualified candidates?

Let’s take the degree issue. Bill Gates and Michael Dell would take exception that a degree is required to succeed in business; even in a technology business. Degrees are conferred for completing course work, satisfactorily. Applying that course work to real life isn’t always a guaranteed success. Degrees are meaningful, but the task at hand should be to identify the problem or opportunity that lies ahead and find someone who has already solved that problem, even if he is a she with no degree.

The same logic follows for test regimens. Testing makes sense for specific skill sets: engineering, CAD, typing, finance, IT certifications, etc. Rejecting talent because they fell below an arbitrary qualification level on an internet-delivered test of 40 questions isn’t the magic bullet of hiring. Tests must be tested for long term success in the same industry and same functional position to be of any scientific merit. Statistical reliability that predicts performance of any manager or senior executive is unproven in the vast majority of tests. It’s a data point, at best. At worst, it’s a waste of potential talent and money.

Talent is an operating expense. There should be a measurable ROI for talent. That talent should be selected to ensure that the current tasks are completed to the level of expectation; which renders a positive ROI. The average tenure for a new employee right now is 34 months. The tenure of a new CEO is less than that. Let’s focus on attracting someone who can deliver a strong ROI in three years or less. If you’re able to create a retention program to keep them longer than 3 yrs, then you’re simply ahead of the game; keeping a contributing employee for longer tenure. Talent acquisition should begin with defining what the existing problems are and what solution sets you’d like to see and then devise a plan for attracting someone who has actually faced those problems before, successfully.

In short, creating barriers to entry is simply thin slicing; taking a dwindling talent supply and creating arbitrary filters to restrict the supply to fit a normative structure that is no longer in parity with the reality of today. Everyone wants to achieve perfect hiring, but people aren’t perfect, neither the hiring authority nor employee. And stark reality is that we no longer hire for ‘permanent’ positions. There aren’t gold watch ceremonies any more and not just because gold is above $1400. Trying to fit a restless population into a structured three-ring HR binder of job descriptions, coupled with a series of thin sliced ‘must have’ attributes is no longer a model for growing your business through strategic talent acquisition.

Define your objective and recruit talent to achieve it. It should be as simple, and as hard as that.