HRHeadStart #29: Hiring Effectiveness; The "Suitcase" Problem; Irrational Passion

ICYMI: Mentorship Program

I shared details about the HRHeadStart Mentorship Program last week. I will be taking in applications until the end of this week and get back individually to everyone who shows interest.

---

The Talent Agenda

Hiring is a crucial process as it injects talent into the organization and we need to ensure the process works well. Estimates of the cost of a bad hire range between 30-100% of the total cost of the employee, with some sources citing even higher costs for critical talent and leadership roles. Hiring effectiveness could be measured by a low False Positive and False Negative rate. A False Positive is when we hire someone who doesn't work out (i.e. we wrongly believed they were awesome). A False Negative is when we reject someone who would have been awesome, but we failed to spot the talent. To improve hiring effectiveness, there are multiple interventions to consider and I would like to focus on two - 1) using a systematic process to reduce bias and "noise" in the candidate evaluation process and 2) using high-validity tools for candidate evaluation

Reducing Bias and Noise: According to Daniel Kahneman (a Nobel laureate), bias is about a group of humans making judgements that consistently go in a particular direction. Noise is when judgements go all over the place in different directions i.e. people seeing the same facts, but reaching wildly inconsistent and unreliable conclusions. He highlights the hiring process at Google (disclosure: my employer) as a good case study in minimizing bias and noise.

"The authors point to Google as a good case study for adopting practices to minimize noise in hiring decisions. At Google, several people interview each job candidate separately. They are given guidelines for judging candidates on specific criteria, like cognitive ability and leadership qualities. The candidates are graded on a predetermined scale for each criterion. The process is more about gathering data than getting a vague, overall impression of someone based on a short conversation. Once all the data have been collected, it's only then that a hiring committee meets and makes a decision about whom to bring on board."

Hear from Daniel Kahneman in this short video.

Using High-Validity Tools: Today, we have an abundance of assessment tools, AI tools, game-based simulations etc. which can tighten up the hiring process. A large-scale meta analysis spanning 85 years tells us that tools like general mental ability tests, structured interviews and robust psychometric tools have the best predictive validity for job performance. Something to also think about is how should we manage the trade-off between speed and effectiveness of the hiring process.

---

Working Better

For a large part of my childhood and youth, suitcases looked like the above picture. It was something that you lifted horizontally and, importantly, it had no wheels - meaning you gave yourself a workout whenever you were on the move! Then someone suggested to turn it 90°, add wheels at the bottom and attach a retractable handle and, voila, life got easier! It's the same thing, but someone viewed it differently. In early parts of our careers, we are often learning the ropes and following instructions, but at some point, you need to start finding the "suitcases" in your organizations that need wheels. It's a mindset and skillset shift and you need to start asking "What could we make simpler, faster and better, even if we retain its essence?".

---

A Productive Workout

A workout is a great way to create mindspace for processing and learning new ideas. And it primes you for creative thinking. For your next walk, run or workout session, take along Adam Grant from Wharton to learn about reimagining the job interview. How do we make better hiring decisions? Should we delegate hiring decisions to algorithms? Understand the questions that matter and emerging answers in this podcast.

---

Tiny Thought

To become great at anything, be irrationally passionate and inquisitive about it.