What Percentage of Your Hires Don’t Live Up to Expectations?

Over the last 15 years I’ve presented to well over 25,000 CEOs and senior executives. One of my favorite questions to ask is:

Of all the hires you’ve ever made, what percentage hit or exceeded your expectations? What percentage missed missed your targets?

Almost all these CEOs and Senior Executives claim that if they were hitting 50% they feel they would be doing a great job. Most readily admit they’re somewhere around 25%-33%.

Amazingly, this statistic is borne out through a lot of the research that has been done studying the accuracy of interviewing. Most studies, at best, show successful hiring less than 50% of the time.

Does this sound dysfunctional? Why do you except results in hiring that are basically random?

We call this CRAPSHOOT hiring since the success rate is essentially equal to rolling dice on the craps table in Las Vegas.

Rolling the Dice during CRAPSHOOT Hiring

You don’t accept this level of random results anywhere else in your business. Why then do you accept in when it comes to hiring? You would never accept random accuracy and results in the payroll checks you write or the invoices you send to customers. What rationalizations do you use to justify accepting random hiring results among your team?

There are many reasons that hiring fails in the vast majority of companies. However, the one that stands above all the rest is that the person or team conducting the interview lacks the skills and knowledge to do a decent job of interviewing.

In most companies, hiring and interviewing is not a process. It’s a set of arbitrary events predicated upon each individual executive or manager. Each one does it differently based on their life experiences.  This random, arbitrary, and poorly trained effort leads to random results.

Another one of the questions I pose in my workshops, seminars, and hiring manager training is:

When should you make a hiring a systematic and rigorous process – not unlike any other key process in your business?

The intuitive answer to that question is RIGHT NOW. Reality then sets in and you recognize that to move hiring from a random effort to a systematic, rigorous, and reliable process requires behavioral change among your executives and managers. Putting forms in place, sending managers to training, and giving out a list of questions to ask in the interview (this would actually exceed what most companies do) is not enough – you actually have to change the hiring behavior of executives and managers that when it comes to hiring adopt the philosophy of “you can’t teach old dogs new tricks.”

When will stop accepting poor hiring decisions in your organization – hiring people who either can’t deliver your expected outcomes or can’t fit in the culture of your business? When will you become so disgusted with your current approach to hiring that you’re finally ready to implement best practices to raise hiring accuracy? Discover some of the most common best practices in hiring and the most common mistakes by clicking here.

Barry Deutsch

How Much HIRING Training Do New Managers or Executives Get?

Ostrich (managers and executives) with their head buried in the sand

If you guessed ZERO, you’re probably not far off the mark. Why do most companies stick their head in the sand like the proverbial ostrich when it comes to hiring and interview training of managers and executives?

Very few companies give their new managers and executives any type of training in how to find, attract, evaluate, verify, vet, and validate the truth in interviews. As a result, the average level of hiring success hovers around the 50/50 mark. Not effectively training managers and executives in how to hire properly is the number one leading cause of hiring failure.

Just because someone has 22 years of experience and has hired 47 candidates in their career – does not mean they are effective at hiring. Experience doesn’t link to success. If we use a criteria of hiring success defined as candidates who achieve your expected outcomes over their first 12-18 months on the job, the actual level of hiring success is probably below 50 percent.

Is there any other process in your business where you will accept random results, results based on each individual managers life experiences, results where you allow bias and emotions to dictate outcomes, or results where no one follows any type of disciplined process?

How about the process of writing payroll checks or the process of paying vendor bills? You’d never accept a 50/50 level of success in those processes – so why do you accept it in hiring?

Okay – you might say “it doesn’t matter what we do – hiring can never be more accurate since people are involved in the process – a walking/talking product.” If that’s not a defeatist attitude, I’ve never heard one. Of course you can improve your accuracy in hiring – primarily by training your managers and executives. Numerous studies have shown, and we’ve validated it in thousands of Vistage/TEC companies, entrepreneurial companies, and large global businesses, that effective training of hiring managers and executives can dramatically improve hiring accuracy.

What are you waiting for? What’s your plan to improve your hiring accuracy? If you accept the trite phrase that people are our most important asset – are you willing to back it up with an investment of funds and time when it comes to training and developing managerial and leadership capability around hiring?

Barry Deutsch

PS – Take our quick one page hiring assessment to determine if your organization is capable of hiring top talent. Click here to download our popular hiring assessment matrix.

Most Company’s Hiring Process Is Not A Process

We find that this occurs because the hiring process really isn't a process in many companies. Many hiring processes tend to be random and with incompetent, untrained people. This is not a knock on the people, it is just a fact. So why do companies expect hiring to be accurate and to attract top talent with a random or unstructured  process?

I know this sounds so obvious. Come on, who in their right mind would expect any business process to be reliable if it  produced expected results only 56% of the time.  A company wouldn't allow it. They would fix the process or shut it down. Would any company have incompetent or untrained people processing incoming checks with unstructured procedures? Lose just one check and everything stops, procedures and controls are assessed, people are retrained or fired, and the CFO personally oversees that it never happens again.

This is true with most processes except hiring. Most companies accept a high failure rate. Why any company accepts this is beyond me when this can be improved with some relatively easy fixes.

The fact is that most hiring managers have little or no training on interviewing and hiring. Many only do it once or twice a year. So even if they have some training, by the time they hire someone they have forgotten most of the training. There are no college level courses focused on hiring. Most people learn on-the-job. One day they are an individual contributor and the next day they are promoted to a manager and told to hire their replacement. So how did this person become competent at hiring overnight?

This new hiring manager is going to hire the way they were hired. This new manager will follow the same methodology whether it is good or bad. Where do you think this person will get the interviewing questions  to ask the candidates? Generally, from the people who hired them. And where do you think the person who hired them got their interviewing questions? And so on, until we finally hit Moses.  Many hiring processes have not really changed with the times. We call this “tribal hiring.”  It is just passed down from generation to generation.

The fact is that this new hiring manager is not prepared for hiring.  Another fact is that people often assume that because someone has hired a lot of people, that  makes them good at hiring even though no one has validated the performance of those hires.

For any process to work it has to repeatable, be structured, have competent people, and have some measurement of accountability so when things go wrong (and they always will) one can identify the problem and fix it. In my thirty years as a recruiter and 15 years helping companies implement a structured process I have yet to find a company that does this.

In fact, I have seen only a few companies that include hiring top talent as part of their performance management system. Why not hold managers accountable for poor hires the same way companies do for other poor performance? At least this would begin to establish a process where a company can identify those  managers that need training, so they can become better at  hiring.

There are at least five distinct steps to an effective hiring process. These steps have to be repeatable,  with competent people and accountability to correct and improve the process. For many companies this falls to HR. However, since the vast majority of companies don't have an HR department, then it has to fall where everything else in an organization should fall, with the CEO.

The five critical steps are:

  1. A job description that  defines the expected standards of top performance for the position. Not the standard job description that defines a person's background and lists the basic duties, tasks and responsibilities. The candidate should already know all of these. Maybe companies should ask the candidate to prepare a job description just to see if the candidate knows the job.
  2. A sophisticated sourcing plan that will attract top performers that are not actively looking for a position, but are open to a compelling opportunity.
  3. Probing interviews with competent people doing the interviewing that tests the candidate's ability to the job BEFORE you hire them. This means that the candidate must be able to explain exactly how they will deliver the performances standards defined in the job. They must detail how they will do these in your company, with your resources, within your culture and your budget, with your management style, with your customers, and with all of the the things that make your company different.
  4. There must be proper feedback or discussion of the candidate's ability to do the job  immediately after the candidate interviews. Not two days later standing in a Starbucks line while  you wait for your coffee. Not just asking the question, “What did you think of the candidate?”
  5. There must other tests, presentations,  and assessments to validate that what the candidates said they did, they actually did do and did it at the level and with the results they claimed.

These five steps are absolutely critical in every effective hiring process. Just having them isn't enough. There must be some metric that determines if the process is working and where improvement needs to occur.

Join the other 10,000 CEOs, key executives and HR professionals and download a FREE copy of our best-selling book, You’re NOT The Person I Hired. Just CLICK HERE  and under the FREE Hiring Resources section you can download our free eBook.

Retaining your best talent is always the best thing any company can do. Download our FREE Non-Monetary Rewards and Recognitions Matrix. It will help you retain your best people without additional compensation. CLICK HERE to download under the Free Resources section.

I welcome your thoughts and comments.

Brad

 

Four Things Companies Do To Shoot Themselves In The Foot When Hiring – Part 1

I recently asked over one hundred CEOs and their key executives, “Is hiring top talent critical to the success of your organization?” Not surprising everyone replied “Yes.” Not simply important, but critical. So then I asked,”If it is critical, then how many of you spend time each month focusing on hiring, excluding when you are actively looking to fill a position?” Not surprising, only three people raised their hand.

WOW, something that is critical to the success of the organization, gets virtually zero time unless there is a current need. Is that the way most critical issues are handled in your company? No strategic planning. No thought or action discussed or taken until the problem arises? Only once the problem arises is it dealt with it. Until then it is that famous management strategy, “Out of sight, out of mind?” or “We will cross that bridge when we get there.”

I believe this management style only happens with hiring. Most other critical issues are regularly discussed, on-going programs such as, cost reductions, product development, increasing sales or market share, customer service, improving operational efficiencies are all constantly discussed and often major components of the company's strategic plan. In fact, I have seen many strategic plans that all have great plans for growth. Yet few ever include a strategy for hiring the people needed to execute the plan as the company grows. Strategic hiring is rarely part of a strategic plan.

I believe companies that truly want to hire top talent and do it on a consistent basis must avoid these four major land mines when hiring:

1) Untrained Managers – Hands down the number one reason hiring fails. This is the biggest problem with hiring in most companies. Few managers are actually properly trained on how to hire. Most managers have never even attended one course or read a book on hiring. For the few that have had training, it is usually limited to interviewing training. Granted this is better than nothing, but interviewing is only one step in an effective hiring process. If you aren't finding qualified candidates, all interviewing training will do is validate they aren't qualified. If the job isn't properly defined then where you look for candidates may not be the right place, resulting in unqualified candidates.

The fact is the vast majority of managers use the “Tribal Hiring Training” program. Too often a person learns to hire from the person that hired them. And the person that hired them learned from the person that hired then, and so it goes all the way back to Moses. All this really does is perpetuate hiring mistakes from one generation to another. It doesn't resolve the problem.

If companies are serious about improving hiring, step one is to develop an effective hiring process and then training their managers in all aspects of the process.

2) Poorly Defined Job – This mistake results in the search going sideways before it even starts. Traditional job descriptions for the most part aren't job descriptions at all. Most describe a person. Does this read like your job descriptions; Minimum 5 years experience, minimum BA degree, then a list of minimum skills/knowledge and certifications, and let's not forget the endless list of behaviors the candidate must have, team player, high energy, self-starter, strategic thinker, good communicator, BLAH BLAH BLAH. Of course there is also the list of the basic duties, tasks and responsibilities. These are really important, but as a person with 5 years of experience, who doesn't know these already? This traditional job description defines a minimally qualified person, not the job. So before the search starts it is all about finding the least qualified person. Any wonder why the least qualified person shows up at your door?

Instead of defining the least qualified person, start by defining superior performance in the role or the results expected to be achieved once the person is on board. For example, Improve customer service feedback scores from X to Y. Reduce turnover from X% to Y% within the next twelve months. Implement a sales forecasting process that includes a rolling six month forecast that is accurate within X% of actual sales. Now this is the real job. It defines expectations, not some vague terms or minimum requirements. For every job there are usually at least four of these results required. The job is being defined by performance. In order for the person to be able to achieve these results they must have the right experience. Maybe it is five years, maybe three or maybe ten, it doesn't matter. If they can do these it is enough. Now go find a person that can explain how they will deliver these once on board and you have the right person.

3) Finding candidates – See part 2

4) Disrespecting the Candidates – See part 2

Join the other 10,000 CEOs, key executives and HR professionals and download a FREE copy of our best-selling book, “You’re NOT The Person I Hired.”  Just CLICK HERE  and under the FREE Hiring Resources section you can download our free eBook.

Retaining your best talent is always the best thing any company can do. Download our FREE  Non-Monetary Rewards and Recognitions Matrix. It will help you retain your best people without additional compensation. CLICK HERE to download under the Free Resources section.

I welcome your thoughts and comments.

Brad

 

Be ANGRY over the average productivity of your employees

Get angry over the average productivity of your employees

 

Be ANGRY that your employees are NOT performing at a higher level than expected. Be ANGRY that your executives and managers are NOT hiring outstanding talent at every level. Be ANGRY over hiring mistakes.

In a blog article published on the Chinnovate.com blog, Tim Yanglin quoted a McKinsey Study looking at the productivity difference between average and mediocre employees. This study was done with major corporations. My perception – although I’ve not quantifiably tested it – is that in small businesses and entrepreneurial companies, top talent is more productive than average talent – sometimes by a factor of 4X-10X. Here’s the study the author of the blog article quoted:

 

 

Global consulting firm McKinsey, for example, reports that top performing executives deliver more than twice the productivity of average performers.

The report continues to identify that it takes a mix of top performing executives and leaders to pursue and implement a variety of growth strategies, which will lead to consistently superior results. On the other hand, McKinsey found no measurable correlation between revenue growth and teams with solid but unexceptional leadership; mediocre or B-level players will deliver average performance.

 

If the gap is so large, why do you allow your executives and managers to continue to hire underperforming, average, and mediocre employees? Let’s take this one step further – why do you allow these individuals to remain on your team?

Get angry over this issue. Make hiring top performers a key initiative instead of falling victim to desperation hiring, making multiple mistakes in the hiring process, and taken anyone who basically shows up at your doorstep.

Everyone complains about their team, hiring, performance, and productivity. Next to talking about your ailments, this probably ranks up there for executives as their next biggest “whine”. Let’s stop whining and start doing something about it.

In 25 years of executive search, over 1000 search assignments, 250,000 candidates interviewed, and over 35,000 executives and managers who have seen our workshop program titled, “You’re NOT the Person I Hired”, most companies give the concept of hiring great employees lip service. Their actions don’t match up with their words.

Here’s a quick test to determine if your actions match up with your words:

  1. Do you set performance expectations for all employees?
  2. Are the performance expectations in place before searching for a new employee?
  3. Do you have a structured program of rewards and consequences for meeting or missing expectations?
  4. How many people on your team right now are NOT living up to your performance expectations? Do you written performance improvement plans for each one?
  5. Are all your executives and managers well-trained on how to use best practices in hiring to find, interview, and select top performers for their teams?

If you answered NO to more than 2 of these questions, perhaps it’s time for a “check-up” of your hiring practices. You can download our FREE hiring process self-assessment checklist to determine if your organization is capable of hiring top talent.

Click here to download our one page hiring self-assessment to conduct a check-up on your hiring process.

You should be angry over these issues – both at yourself and your executive team – for allowing it to happen. Stop just letting hiring “happen”. Drive better company results by being the visible and LOUD champion of hiring and retaining top performers.

Here’s the key: the quality of employees in your organization determines your “glass ceiling”. If you have average and mediocre people, then your results will be mediocre and average. If your not getting exceptional performance within your industry or market – beating your competitors every day and generating above average metrics in revenue, profit, and operational excellence, then perhaps it’s time to take a look at the quality of your team.

Barry Deutsch

PS – Don’t forget to get your FREE digital copy of our best-selling book on hiring, You’re NOT the Person I Hired