How Technology is Changing Recruiting (video)

03/29/2014

I’m often asked to give presentations to HR groups on trends in recruiting. Here is a video of the slide deck from my last presentation to the Human Resource Association of the National Capital Area (HRA-NCA).

The key takeaway is that Google search algorithms have a significant impact on the results you will receive from job postings, the visitors to job boards and LinkedIn are increasingly on mobile devices, and millions of job seekers are rating employers. All three factors require employers to adapt their recruiting strategies, or risk being left behind.

Fair warning, the purpose of the presentation was to highlight the trends, not to prescribe solutions, so there’s no easy answer to be found in the last slide.


What’s the Real Problem with Job Advertising?

03/28/2014

We humans tend to confuse scarcity with value. We tend to overvalue what is difficult, and undervalue what comes easily. We overvalue what we don’t have and undervalue what we do have. You hear the mental confusion when a recruiter puffs up his chest and intones, “Good people don’t answer job ads.”

The recruiter is trying to build up the perceived value of the difficult work of reaching people who do not answer ads, and diminish the value of what comes easily (people who answer ads). But c’mon, the phrase just sounds ridiculous. Of course good people answer job ads.

Recruiters don’t actually believe that the very act of answering a job ad degrades a candidate’s skills in some way, while remaining unresponsive to advertising makes them better at their job. Obviously someone’s ability to perform on the job is wholly unrelated to how you recruited them. In our executive search work, we’ve found good people who answered job ads, social media outreach, cold calls, and emails. We haven’t tried it, but I’d bet that we could walk around wearing sandwich boards and some good people would respond (if the messaging on the sign was good enough).

So what’s the real problem with job advertising?

The problem is that good people rarely respond in large enough numbers to teach you anything useful about your job market. And there’s the rub. We’ve looked very closely at the engagement rate of good people to job advertising, and in our experience, it hovers around 1-3% of the total candidate pool. Don’t get me wrong; there are some fine people in that little number. (But I should also mention that our ratio of “on target” to “off target” resumes is about 1:30, so it takes a bit of reading to find the good ones.)

But if you want to hire a top performer (by definition, one of the top 10% of people with that skill in the market) and your job advertising only engages 1-3% of the best people in the market, how do you know when the candidate sitting in front of you is one of the best? All you really know is that they are one of the best people who happened to see your ad. You simply lack the context to know how they compare to their peer group.

How do you decide whether or not to hire them?

And that’s the most vexing conundrum of staffing for most hiring managers. The hiring manager always wants to hire one of the best possible people in the job market, but lacks the context to understand if the candidate sitting in front of him is one of the best. It’s vexing because in order to properly evaluate the handful of good people who answered your job ad, you need to understand the entire job market. But only a small fraction of the entire job market will ever answer your job ad, and, by definition, only a tenth of them are in the top ten percent. Without a sophisticated candidate research capability, you are flying blind.

While hiring managers can easily define the skills they would like to see in a position, they rarely know how the job they defined compares to the skills of the people in their job market. Supply and demand for skills varies wildly by position, by city, and by time-frame. It’s fairly common to define a job in a way that makes it unfillable, or undesirable, or that requires someone you cannot possibly afford. How will your recruiting process catch the error?

Can your recruiting process answer questions like these?

  • How many people in Washington work in finance for a nonprofit with a budget over $50 million?
  • What do their salaries and career paths look like?
  • How many would be interested in the position you have open?
  • How do their titles compare to your internal title?
  • How will small changes in your title, or responsibilities, or experience requirements change your recruiting outcomes?

Without this data, you can’t make an intelligent comparison between your open job and the supply of people. And you cannot get to the next level questions like:

  • How does your job stack up against other places your candidate might want to work?
  • How does your compensation compare to their other options?
  • Should you hire the person in front of you or hold out for someone better?

And that’s the real problem with job advertising, social recruiting, or any recruiting approach that only yields a few good people. You may be missing the people you really want to reach, and you may get a few good people, but you have no idea what to do with them.


Do You Really Need to Interview a Slate of Candidates? Or Just One?

03/11/2014

When hiring, it’s tempting to rush into interviewing, rather than waiting to develop a full slate of candidates. Hiring managers are often eager to interview as soon as they approve a job description. It’s a request most HR folks try to oblige. And it’s often a mistake.

So what’s the downside to interviewing the first few qualified people who responded to your recruiting efforts? If it only takes one great person to fill the job, why wait around for more candidates to emerge? What if the good people get other jobs while you are waiting? 

Occasionally, it does make sense to interview the first few people who apply. But most of the time, you actually slow down your search by interviewing too soon. Unless you are incredibly familiar with the job you are filling, waiting until you have developed a full slate of five to eight candidates almost always results in a  better hiring decision. (To be clear, I’m talking about waiting 3 or 4 weeks, not 3 or 4 months.)

So how do you know when to jump, and when to wait? We’ve put a lot of thought into this question, and here is our decision process (click to see the larger view):

SA Candidate Slate Flowchart

For example: If you routinely hire for Network Engineers, and currently have several on staff, then you have an excellent basis for comparison when you interview another Network Engineer. Because you have recently interviewed dozens of these candidates, you can instantly recognize a good one when you meet them. And you know what to pay them. No need to wait for a slate here.

But if you have not recently interviewed any Network Engineers, you don’t really have a basis for comparison. You need to educate yourself before you can make a fully informed hiring decision. You are unfamiliar with the job market, no matter how deeply familiar you are with the job and skills required. You need to see firsthand how people from various backgrounds would bring different capabilities to the job. You need to see how compensation for the role varies by skill level. In short, the early candidates might be fine – but without a full slate of candidates to choose from, you are not ready to properly evaluate them, or to understand how your job compares to their other options.


When You Undervalue HR, You Undercut Your Managers’ Effectiveness

02/24/2014

desperationOne of the fastest ways to sabotage your business results is to hire the cheapest HR professionals you can find. When you saddle your executive team with under-staffed (or under-skilled) HR support, you hobble their performance. Here’s why:

  • More than any other person in an organization except for the CEO, the top HR executive impacts how much courage managers will show in hiring and performance management.
  • HR has an enormous impact on your budget. In many organizations, the lion’s share of the annual budget is spent on salary and benefits, and HR typically determines how strategically that money is allocated. (Good luck attracting great people when you offer lousy benefits and no clear way of measuring or rewarding performance).
  • HR has a huge impact on results. HR maps out the strategies that attract, retain, and inspire the staff to help you achieve your mission. (Good luck trying to achieve great things without great people. Even if you hired some great people, ineffective or bad HR strategies could end up demoralizing them just before you need their best work).
  • And when things really go sideways, HR helps you evaluate the legal risk of ushering your hiring mistakes out the door, before they cause even more damage. (Or do you enjoy making chit-chat with your former employees’ lawyers?)

But it’s a precarious business to be an effective senior HR executive. In a cruel twist of fate, doing the HR job well requires putting their own job at risk repeatedly, because it’s often their responsibility to speak the uncomfortable truths to power. Great HR people make the CEO less comfortable, not more comfortable. Consider how:

  • When you feel like your organization is already spending too much on salary and benefits, a top HR executive will tell you that your compensation still isn’t competitive, and you need to spend more if you want to hire and retain the best people.
  • When you think you’ve communicated enough about your performance expectations, great HR tells you the team is still fuzzy on the details and you need to do more for them to understand you clearly.
  • When you would rather dodge addressing a situation with a problem employee, great HR won’t let you shirk your responsibility, and keeps the issue on your agenda until you resolve it.
  • When you want to blow up in righteous indignation at someone’s failure, great HR instead cools you down and points out that there are environmental factors that set them up to fail.
  • When you make the workplace less productive by occasionally micromanaging, undercutting your executives, or not acknowledging high performance, great HR points out where and how you could improve.

Good ol’ HR, always the life of the party. (Mommas don’t let your babies grow up to be cowboys HR pros.)

If you are a CEO and your top HR pro does not make you uncomfortable, consider that you might have the wrong person for the job. Or consider that you may actually have the right person. But instead of letting them speak truth to power, you instead make it abundantly clear that they shouldn’t bring you tough information. Either way has the potential to put everything you worked for at risk; your pay practices, performance management, and maybe even legal compliance could be sorely lacking. You need to encourage HR to bring you the bad news. Take a Dramamine if you need to, because it will rock the boat.

But if you ever want to hear the truth, don’t make it your policy to shoot the messenger.


Good People Know Good People … or Do They?

02/22/2014

icebergConventional wisdom says that, “Good people know good people.” So it naturally follows that the most common question in recruiting is, “Who do you know who might be good for this job?” Good people will inevitably lead you to other good people, right?

But what if, “Good people know good people” was more untrue than true? What if it’s really a “tip of the iceberg” situation, where the visible part of the statement that’s true is so much smaller than all the hidden assumptions underneath the statement that are not true?

The visible part is easy. We all have evidence to support it. When you hire someone you know, it can be less risky than hiring a stranger. Whether you worked in the same organization or just volunteered with someone, you probably know more about them than you would learn in a typical interview. So yes, it’s true. Good people do know good people. 

But it’s not that simple. There’s quite a bit missing from the argument that, “Good people know good people.” The frame of reference is far too small. The five simple words overlook the fact that:

  • Good people never know ALL the good people.
  • And of the people they do know, they rarely remember or recommend ALL the people who should be considered.
  • Good people aren’t necessarily good at matching people to jobs
  • And they don’t have ANY idea how the people they know compare to the people they don’t know.

So no matter how well connected anyone is, they only ever meet a fraction of the potential candidates for any particular open job. And we all have preferences and biases about the kinds of people we might recommend. And none of us have any idea about the people we’ve never met. So whenever I ask anyone, “Who do you know who might be great for this job?” their answer is always limited by:

  • Their desire to take any time to help me with my question.
  • The size of their circle of friends.
  • Who they actually remember from their circle of friends.
  • The depth of what they remember about someone they worked with years ago.
  • The context of the work environment in which they observed someone else’s work.
  • Their understanding of your open job and their ability to discern who might be a fit
  • The kind of people they happen to enjoy working with.

When you add up all those unspoken limitations, the limitations are bigger than the true part. The biggest part of the iceberg is invisible.

When you look at the larger context, “Good people are an unreliable way to find other good people” is a more accurate statement.

So, to keep from fooling yourself, if you want to keep playing the “Who do you know?” game, just give voice to the limitations of it. To that end, please allow me to offer you a more complete question:

“If you don’t mind me interrupting you, and you are willing to spend time with me on this question, who have you ever worked with for long enough that you could actually comprehend the totality of their skills, and have you taken the time to carefully evaluate their ability to thrive in a completely different context such as the one I am proposing to you now? And precisely what are your qualifications to evaluate someone’s ability to succeed in a different work environment? Have you left anyone out from the list of people you are recommending, and is that because of a personal preference of yours that you may not even be aware of? Do you know if I share that personal preference? Have you ever considered just how many people you do not know? And, if you are even qualified to judge them, please evaluate the abilities of the person you are recommending relative to the population of other qualified people?”

But if you are a recruiter, and if you are talking to a stranger, I suppose that question could be a bit more uncomfortable to ask.

 


Chronic Employee Turnover Is Almost Never About the Employees

01/22/2014

bad-adsSenior executives often call me when they are at their wits end with people on their team:

  • “I’ve tried to make things work, but my VP of HR is just not delivering the results I need.”
  • “My Communications Manager just won’t step up to the plate. We seem to only react to things without any strategy.”
  • “The world changed around us, but Finance is doing the same things we did ten years ago. I’m getting no useful information and feel like I am constantly dragged into the weeds. We need to rethink what we are currently doing, but frankly I’m more worried about all the problems we are not even thinking about yet.”
  • “Our IT department is a real bottle neck. We want and need streamlined processes, better information sharing, and improved productivity. But all we get are surprise expenses, empty promises, and long delays. Even simple requests seem to get buried in obfuscation and complexity.”
  • “Our Chief Marketing Officer is not doing anything that drives revenue. We’ve spent money to upgrade our social media presence, revamp our website, and conduct extensive customer surveys. But our revenue is still flat-lined.”

Some of these concerns might sound like people problems. But twenty years of experience as an executive recruiter has taught me that what looks like a people problem is often a situation problem. An occasional bad hire is nearly unavoidable. But if you churn through executives every few years, your chronic turnover almost certainly runs deeper than just one bad egg. When your department or executive team has a pattern of failure, it’s likely that your work environment sets people up for failure (however unintentionally).

The First Law of Holes is, “If you find yourself in a hole, stop digging.” In the face of chronic turnover, don’t hire anyone new until you fix the underlying issues. Chronic turnover problems won’t be solved by blaming individual employees and then going out to immediately hire more. As Einstein noted, “We cannot solve our problems with the same thinking we used when we created them.” Instead, chronic turnover is best solved by looking beyond the individual people and exploring any issues in the work environment. Before you move forward with another round of hiring, step back and look at your own role in these seven common causes of employee failure.

1)      Are you using an outdated business strategy? Maybe the way you’ve always done things no longer works. Nothing runs on autopilot forever. If it’s the wrong task for the times, it won’t matter who you assign to do it — they will fail. The skills required for success ten years ago are not nearly enough to achieve success today. Almost every job has an increased demand for results, coupled with dramatically higher complexity and ambiguity in the work. You can’t just use old job descriptions and salary budgets to hire new people … but many people still try to.

2)      Maybe the best people are just not that into you. Do you have trouble attracting great people to your open jobs? Or do you interview great people, only to see many of them withdraw from a second or third interview? That’s a signal that you, your job, your organization, or your industry are just not that attractive to the people you want to hire. No one stands in line for an iPhone 3G anymore, even though they did a few years ago. Have you considered that the job market might have changed around you and the best people have better options elsewhere? When was the last time you benchmarked your salaries against the competition? Do you really understand who is available in your job market and who you are competing with to hire them? (Almost nobody does this kind of market research when hiring.)

3)      Are you still placing .22 caliber people in a .357 Magnum job? Growing organizations outgrow people. Your internal positions inevitably become more complex as you grow. So your next HR Manager will face dramatically different challenges than your last one. Just because the last HR Manager was willing to work for $90k does not mean you can use the same salary budget to replace her. When you hire, you need to think about the future, not the past. And if you need a new business strategy (see #1), are you ready to pay a salary premium to hire someone with those skills? Strategy never comes cheap, but far too many managers hope (in vain) to find it in inexpensive candidates.

4)      Are you disappointed with everyone you interview? Perhaps your recruiting team is only considering the people who fit your salary budget, or perhaps your recruiting strategy only reaches the people who respond to job advertising (only about 18% of the total candidate pool responds to recruitment advertising). If you want different recruiting results, you need to align your HR practices with your business strategy.

5)      Do you hire new people to shake things up, only to be disappointed after you hire them? Do you find that your people will not step up to the plate? Do you give new people big audacious goals, then disappear while they get stuck in the thicket of executing? Do you hover at the big picture level, never getting in the weeds with them, making them feel like they are going it alone? Do you ask new people to build consensus with your overworked, understaffed current team, or do you help pave the way? And when it comes to conflict — be honest with yourself — do you reward your team for encouraging healthy debate, or reward them for getting along and not rocking the boat? Change agents need more support than senior leadership usually provides them, and they always cause more chaos than their managers prefer. You can’t say you want to hire change agents and creative thinkers and then not facilitate their ability to foment change.

6)      Do your new employees charge ahead, or freeze like a deer in the headlights? There’s an old saying, “The fish stinks from the head.” Do you share the credit and take the blame? Or vice versa? If your new hires know that they will be blamed for every error, how many risks do you think they will take? Do you swiftly make gutsy judgment calls in the face of uncertainty, or do you expect your subordinates to take those risks instead? If you are always traveling or behind closed doors, is your team forced to guess at what you are thinking? Do new employees have to figure out their mistakes from group emails or other employees? Or do they get honest, direct, and regular feedback?

7)      Do you have a rule for everything? Are your employees trusted to exercise good judgment or do you have a thick set of policies for everyone to follow? Maybe your HR policies were initially designed to mitigate your legal risk, but after years of adding small edicts to your employee handbook, your office now exudes the depressing atmosphere of a police state, repelling the very people you want to attract. Police states are rarely nimble or fun. (And in a sad bit of irony, some employment attorneys suggest that all those oppressive policies might actually increase your legal risk.)

If you find yourself blaming the person who failed in a job, you’re probably looking in the wrong place. You’ll almost never find the solution there.

Before you look at new people, look at yourself. Chronic turnover problems are best solved by looking long and hard at how you might be contributing to the very problem you are asking someone else to solve.


5 Steps To Build A More Innovative Organization

11/20/2013

business strategy Are you struggling to get your new initiatives off the ground? Do you wish your organization was more nimble and entrepreneurial? Do you yearn to build a team of people who don’t need a rule-book … people who can handle ambiguity? Do you daydream about having a team of fearless innovators who bring you great ideas, and then leap into action to make their ideas a reality?

OK, fine, it’s good to have goals.

But if you don’t work in that kind of environment right now, are you sure you know what innovation really looks like … up close and personal? And when you interview an innovator, just what exactly should you look for? And after you hire them, will your office be like the set of Mad Men?   

If you’re looking for someone with a history of serendipitous moments, where the innovation muse whispers brilliance into their ear, the cosmos align, the sun bursts through the fog and birds start chirping, you will be looking for a very long time. As children we all heard the tale of the apple falling on Sir Isaac Newton’s head, causing a supposedly sudden insight into his theory of gravity. But few of us heard what Mr. Newton was doing prior to that famous moment. So does innovation look like blindingly brilliant moments of fruit-inspired inspiration? Or does it look more like the part of the story that happened before the apple fell?

Sorry kids, strokes of genius are really tiny–more like pointillist painting than the broad-brush conversational style used in most executive suites. If you want to hire an innovator, don’t look for a fast-talker with grandiose ideas, they will not go the distance. As Harvard professor Rosabeth Moss Kanter put it, “Everything looks like a failure in the middle. Everyone loves inspiring beginnings and happy endings; it is just the middles that involve hard work.”

Instead of hiring a big talker, seek out someone who can methodically and painstakingly take tiny, unconnected painted dots (ideas) and form them into a bigger (and more interesting) picture. Scott Berkun, author of The Myths of Innovation, calls this the “Myth of Epiphany.” As he puts it, “Epiphany stories project illusions of certainty since they’re always about successful ideas. Epiphanies are a consequence of effort, not just the inspiration for it.

Other researchers have also concluded that innovation is a far more arduous process than most of us are led to believe. Keith Sawyer describes how one researcher set out to chronicle Eureka! moments only to find that good ideas are actually built upon bit-by-bit.  Peter Sims studied Pixar and the creative process used by world-class architects and comedians. Here is what he said:

“It may take Chris Rock six months to a year to develop one hour of comedy, and he does it by just scribbling ideas down on sheets of paper, going into these clubs unannounced and sitting down in a very relaxed, casual way with the audience, so that they know that, “Hey, this is not Chris Rock in prime time. This is Chris Rock in development mode.” He’ll just start riffing with the audience and he’ll bomb. It will be awkward at times. But what he’s doing is he’s looking for just a little hint as to where a hidden joke might be, and, once he finds that, then he keeps on that idea and keeps iterating, keeps improving, tweaking, until it becomes more and more a joke that he can use in his routine.”

Chris Rock knows many of his joke ideas will bomb. More importantly, he knows that’s completely OK. He revises and edits his material until he arrives at the tightly crafted sets we see on HBO. Breakthrough ideas and innovations are built on foundations of mistakes and dead ends. Innovation is surprisingly methodical, as it emerges over time out of “peripheral” knowledge, or out of seemingly irrelevant ideas.

Even on TV, innovation does not look so easy:

What appears to be an effortless flash of brilliance in this clip did not come out of nowhere (though the timing is fortunate). Prior to the dramatic scene, Don Draper had spent the entire episode scribbling countless pitch ideas onto napkins, only to decide they were all terrible.

So how do you build a more innovative organization? 

Read the rest of this entry »


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