Watterson & Associates BLOG

Information, musings, and brain bites from an I/O consulting firm

Selection Process for Hiring Star Employees

By Mark Kogelnik

It is not new news to hear how difficult it is to attract, retain and develop talent. It seems that nearly everyone agrees that one of the most challenging responsibilities is to hire and onboard employees.

In fact, very few dispute the pitfalls commonplace to staffing. In fact, living with a bad hire is one of the biggest mistakes we can make. The U.S. Department of Labor estimates that the average cost of a bad hiring decision can equal 30% of the individual’s first year potential earnings (U.S. Department of Labor, 2003).

If that’s true, then why is it that hiring practices for many organizations have changed so little over the last 50 years? Why are organizations not making better use of affordable, time-sensitive, activities that can drastically improve a company’s batting average when it comes to selecting and retaining talent? Why are companies not investing in ways to review hiring data that can predict the next star employees?

These activities seem critical given the aging workforce and the need for organizations to improve their succession planning processes. “Companies need formal succession plans to be competitive in 2015,” says Josh Bersin, principal and founder of Bersin by Deloitte. In a 2015 HR Magazine article, Bersin wrote that many organizations struggle to facilitate internal talent mobility. Fewer than one-third have formal succession plans for all but the very top levels, according to research conducted by Bersin by Deloitte and published in November 2014.

While it can be easy to see the typical pitfalls when we step back, it is much harder to catch ourselves from making missteps when we are in the middle of filling a critical role. For example, hiring managers often admit the pressures they are under to hire, often sacrificing diligence and patience when it is needed most. Others readily point to a time when they experienced groupthink and didn’t question a peer or boss when making a poor decision after a final interview. Others say they overlooked, and/or justified their decisions in the face of contrary objective personality or ability data, after living with a bad hire.

In other words, people are so busy with the day-to-day, they often do not invest the time to proactively work on their organization’s hiring process. In fact, it seems that many organizations engage the hiring process as a reflexive, knee-jerk activity in response to an opening or vacancy. All that said, many organizations have a ways to go when it comes to tightening up their hiring processes. So, how do you avoid making a bad hire?  Here are my suggestions:

  • Stop making the common errors we make under pressure to hire. For instance, mistakes like falling for candidates who remind us of ourselves, or not having a structured interview format so that we can compare apples to apples.
  • Start treating the entire hiring process as a way to collect data and then incorporating ways to review the information in a consistent manner. Many organizations do not have a common way to synthesize all of the information collected throughout the hiring process, such as interview notes, personality data, resumes, etc. In the end, many feel that there is so much data to comb through that it can be overwhelming.
  • Pay attention to what the research tells us. For instance, new insights from Glassdoor data suggests that globally, the time required for hiring processes has grown dramatically in recent years. Based on a sample of 344,250 interview reviews spanning six countries, key findings from their survey indicate that “Hiring policies of employers can have a large effect on the length of the interview process. Choosing to require group panel interviews, candidate presentations, background checks, skills tests and more each have a positive and statistically significant effect on hiring times.”
  • Copy from those companies that know how to hire effectively. Leading companies have incorporated the latest advancements in personality assessments, combining them with world-class hiring practices, to drastically improve their selection success. Instead of getting mired in too much data, top organizations have systems to assist hiring managers with making sense of the data, thereby allowing them to achieve quick consensus.
  • Learn from mistakes. When mistakes happen—as they occasionally do when it comes to predicting talent—the best organizations look at any missteps made along the way. And the learning is perhaps the most crucial when it comes to the outliers—those who are performing well outside of expectations. With data and systems in place, the best companies can quickly pull together data to hypothesize why and how some people are drastically outperforming their peers.

Looking into the future, it is safe to say that attracting and keeping talent will continue to be a challenge. Paying attention to what you’re doing, as well as what others are doing (like making use of a personality assessment combined with HR best practices) is a wise way to maintain a distinct advantage relative to the competition.

 

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