I recently posted a rather contentious article on the idea that inadequate hiring processes lead to an assortment of preventable hiring mistakes. Unfortunately, these mistakes have profound repercussions including underperformance, dissatisfaction and turnover. I classified these hiring mistakes into four levels of performance – from Type 1 hires at the lowest level to Type 4 at the highest. Many readers misunderstood the type classification as being a categorization of the person. It’s not. It’s a categorization based on the result of a flawed hiring process. For example, putting a great person in the wrong job would be considered a Type 1 or Type 2 hiring decision.
As part of the post, I alluded to the idea that the root cause of most of these problems is not the fault of the hiring manager but the company’s underlying talent acquisition strategy. The best explanation of this was found in a link to the video below aptly titled The Staffing Spiral of Doom – Catch 22.
For those not into videos – despite their entertainment and/or informative value – here’s the quick summary.
- There are two primary staffing strategies. One is based on the assumption of a surplus of talent and the other on a scarcity of talent.
- A surplus strategy assumes there are plenty of good people available. As a result, hiring processes are designed to weed out the weaker and less qualified candidates. While demeaning, it will work if there are plenty of top candidates available who are willing to take lateral transfers, accept average compensation and are driven by an economic need to apply. This approach will not work if the surplus assumption is wrong. In this case you’ll hire more Type 1s and 2s, a few Type 3s, and no Type 4s, since the best people for the position won’t apply.
- A scarcity of talent strategy assumes there are not enough strong people available to meet a company’s hiring needs. In this model, it’s necessary to attract the best people via proactive and outbound recruiting approaches. Much of this involves networking, building pipelines of prospects and targeted email campaigns. In the earlier Four Types of People post I suggested that in order to attract the attention of the best of these people, messages had to be compelling and career-focused. On top of this the interviewing and screening process needs to be longer and involve a number of additional exploratory steps.
- While many companies are aware of the scarcity of top talent situation, most still use a surplus approach for attracting and screening these people. To offset this dilemma, they use a battery of indirect assessment tools in the belief this will allow them to hire stronger people. In the Four Types of People post, I contended that while this will minimize Type 1 and Type 2 hiring errors, it will result in more Type 3 hires. These are people just like those whom the company has always hired. This is not necessarily a bad thing if all of these people are strong, but it does prevent improving the overall quality of the people hired.
- In order for a company to raise its average talent level it needs to hire more people above the current average. This requires programs based on how these stronger people look for new jobs and how they decide to accept one job over another. While most companies know this, they insist on using methods that preclude this from happening. This is what’s referred to as a Catch-22 from Joseph Heller’s book of the same name. The video describes the problem and offers some techniques to break free from its circular reasoning.
Bottom line: You can’t use a surplus of talent approach for hiring new people when a surplus of talent doesn’t exist.
Lou Adler (@LouA) is the CEO of The Adler Group, a consulting and training firm helping companies implement Performance-based Hiring. He’s also a regular columnist for Inc. Magazine and BusinessInsider. His latest book, The Essential Guide for Hiring & Getting Hired (Workbench, 2013), provides hands-on advice for job-seekers, hiring managers and recruiters on how to find the best job and hire the best people. You can continue the conversation on LinkedIn’s Essential Guide for Hiring Discussion Group.
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