The Hiring Revolution: Setting the Stage

The systematic hiring of top people is the primary goal and mission of the hiring revolution. Read last week’s article if you need any proof as to why you need to join this revolution. It’s about your future. In this article, I’ll describe the ten big challenges

we’ll face as we begin the task of making hiring top talent a systematic, Six Sigma formal business process. Some of these are high-level issues; others are specific implementation problems. They all need to be considered.

A system-level solution is required. There are many individual processes involved in the hiring of top people, like sourcing, interviewing, closing, resume tracking to name a few. A change to any of these steps means that you should directly consider the higher-level system implications. For example, you can’t add a better filter on an ATS if top people decide to opt out. This is called sub-optimization. As we build our systematic hiring process, we’ll need to first conduct a Pareto analysis to figure out the worst problems. From this, we’ll develop system-level solutions on a priority basis.
Balance the soft and hard stuff. The people issues (candidates, recruiters, hiring managers, other interviewers) tend to mess things up. While it might be easier to automate the data management processes, it’s much harder to control the human side of the hiring process. And a lot of that needs systemizing. This includes everything from how candidates decide to apply for jobs and accept offers to how involved recruiters are in the process and how competent they are; from how managers interview and assess competency to who negotiates offers and how well they do it.
Address candidate supply and demand and the economy. We can’t design a hiring system for a static environment. Right now, there are too many candidates for some jobs like software developers, and not enough for others, like healthcare workers. A dynamic sourcing solution is required to take these difference into account. This means the system must be flexible enough to address economic cycles and changes in the labor supply.
Consider the employer, the brand, and the individual jobs. Better companies with better jobs tend to do better in hiring top people than unknown companies with lousy jobs. The hiring system needs to compensate for these differences. For example, some top companies struggle to hire top people if they offer below-market compensation. This requires a better recruiter and hiring manager to be more involved (and to be more convincing). Lesser-known companies with aggressive comp plans need to spend their time getting visibility.
Include metrics, management and organization into the mix. What’s the best way to organize a recruiting department? What metrics should be used? What should be outsourced? Can the recruiting process be moved offshore? I believe that metrics must be real time, not historical, and the best real time metrics need to be tracked when the event occurs. This is how you create a feedback control process, which is the essence of any dynamic system.
Don’t forget the workforce planning piece. This determines the scope and size of the hiring process and the required system. The more lead time you have to plan out the hiring process, the better results you’ll ultimately achieve.
CEO commitment and resources available. If you don’t have enough money and the CEO isn’t committed, you don’t have a chance. You must be able to make a business case that the continuous hiring of top people is a strategic asset. For example, are you aware that a top-third sales rep is twice as effective as the bottom-third (the group that leaves)? This is about $200,000-$400,000 in additional sales for most companies for each sales rep, each and every year. That’s $30 million in annual lost revenue if you have 100 sales reps. It’s pretty easy to make a persuasive business case with this kind of impact. This type of top-third to bottom-third business impact is similar for every position. Hiring only the top-third, by the way, is a very realistic goal. These are the “B” candidates and above.
Design job boards to eliminate unqualified candidates before they apply. Some job boards actually do this. Can you imagine how great it would be if we didn’t have to spend so much time working with unqualified candidates? This can’t be done with simple filtering questions alone, or by using skill words, and it can’t be done by asking the candidate to go through more up-front hoops. It must be done automatically. One idea is to auto-read the resume and then provide instant feedback to the candidate as to whether they’re qualified or not. We’re now starting to work with some of the forward-thinking job boards on how they can better serve both candidates and customers. Another idea: pay job boards for quality, not quantity.
Make sure that applicant tracking systems make recruiters and hiring managers more productive. Right now, most ATSs require too much work to keep them functioning. At a simple level, they need to make it far easier to change a candidate’s status. Why not automatically? They certainly should automatically tell recruiters the moment new, hot candidates enter the system, and they should then tell them what to say. Candidates, recruiters and all interviewers should be able to schedule interviews real time. How much time would this save? ATSs should also figure out which job boards to post to automatically. Once they can do this, they should then automatically develop a sourcing strategy based on supply and demand factors and the importance of the job. If workforce planning is built in, then top candidates should be available just in time. Pushing information to the recruiter’s desktop is the next wave of ATS design. We are now working with some very proactive ATS vendors who are addressing these issues. Make sure yours is one of them, or get one that is.
Make the design people-proof. Good candidates say stupid things or sometimes don’t say enough. They may mislead, and sometimes even lie. Some hiring managers measure the wrong things, make dumb decisions, don’t know the job, and make superficial assessments. Sometimes they oversell and under-listen. Recruiters frequently let good candidates slip through their fingers without a fight, or sometimes forget to call. Some make too many excuses, and sometimes have too much to do feeding the ATS. Some are too involved, some not enough. Technology is available to minimize these operator errors. More is coming. More mistakes are made on the people side than all of the other points noted above combined. The systematic hiring of top people is a people-intensive system. Quality needs to be built in, not inspected out. This requires training and systematic reinforcement.

This is just a start. Expect revisions. The systematic hiring of top people requires a revolution, not incremental change. My sense is that a few essential changes are required to jump start the process:

CEO commitment is essential. When CEOs and senior executives make this a key priority, things tend to happen more quickly. Consider Jack Welch’s GE as a great example.
Job boards need to redefine their mission. They need to figure out better ways to pre-qualify candidates, rather than leaving it up to individual companies to review all of the same resumes.
Applicant tracking systems need to automate important value-added processes, not automate unnecessary procedures. Also, when ATSs start automatically pushing critical information to the recruiter’s desktop, hiring top people will be less dependent on the quality of the individual recruiter.

Finally, you must join the revolution! Without your involvement, nothing will happen. [Note: If you’d like to help make hiring top people a Six Sigma business process join the band of 176. Feel free to submit a point or two for our hiring revolution guiding principles. As you know I’m starting my national hiring revolution Zero-based Hiring tour on September 25, 2003, in L.A. Then it’s on to Chicago on October 15, and the rest of the country over the next 12 months (here’s our Zero-based Hiring tour schedule). I look forward to meeting you in person at one of our tour stops. There needs to be a revolution. Help get it started. Become a hero.]