THE COST OF QUALITY OF HIRE IS FREE
A New Idea for Maximizing Quality of Hire, Reducing Time to Fill, and Minimizing Cost –
At a recent Performance-based Hiring training session, a group of hiring managers were complaining that they had to see too many candidates before hiring someone reasonable. I suggested the problem was probably an old-time quality control issue: using inspection at the end of the process to control quality of hire, rather than defining and controlling it at the beginning.
If you’re old enough to remember, back in the 1980s the Total Quality Management (TQM) initiative became a global groundswell. This is turn spurred the growth of lean manufacturing, six sigma process control and the Baldrige Award. The simple idea was that if you controlled quality at every step in the process, rather than reject the results at the end, overall costs would decline and quality would be maximized. The was the promise and essence of TQM and what its acknowledged leader, W. Edwards Deming, proposed. It worked, and led to a huge world-wide quality and productivity boom, although the U.S. was very late to the party.
If you look around your business today you’ll see evidence of this concept in every function and business process, except for recruiting and hiring. The underlying problem had to do with the lack of a meaningful and repeatable process for maximizing quality of hire. Without this, applying TQM-like controls is comparable to pushing on a cloud.
As I see it, too many companies still use a hiring process based on high volume attraction and a quasi-scientific process for weeding out the weak, hoping that a few good people remain at the end. A process based on how top people find and select opportunities might be a better place to start. With this in mind, here are some Deming-like TQM principles for building quality of hire into the system at the beginning rather than inspecting it out at the end.
1) You need to have the right strategy before you develop the right process. As business-guru Michael Porteradmonishes, strategy drives process, not the other way around. If you’re in a talent scarcity situation where the demand for talent is greater than the supply, you can’t use a talent surplus strategy to find and hire these people. I refer to this false choice as the Staffing Spiral of Doom. If your company is still using traditional skills-infested job descriptions for advertising and using this flawed information to filter out people, you are assuming there is an excess supply of top people. If this assumption is incorrect, you need to rethink your strategy and bring your downstream processes into alignment.
2) Make it a system. In most companies the core hiring processes – defining the job, sourcing, interviewing, recruiting – are designed separately by different people with different needs and perspectives. This silo-based approach versus a fully integrated and complimentary system is not only inefficient, but counter-productive. Lack of a top-down talent acquisition strategy is typically the cause.
3) Define quality of hire before you start looking. The recruiter and hiring manager need to define and agree to quality of hire when the requisition is opened. This is not a job description listing skills and experiences. It’s not even adding more technical skills to the job description, or narrowing the criteria to top-tier schools and top-tier companies, or adding more IQ. Instead, it’s defining the actual work the new person needs to do in terms of exceptional performance. I refer to these as performance profiles. You can then use this criteria to filter and interview people based on their ability and motivation to do this type of work at the level of performance defined. Done properly, everyone seen by the hiring manager is then a potential hire.
4) Build your sourcing and recruiting process around how top people look for new jobs and compare offers. Top people are not looking for lateral transfers, most find their next jobs through networking, few will formally apply before talking with the hiring manager, and they’re very concerned with the career opportunity, the challenge of the job, the impact they can make and who they’ll be working for and with. Few companies build their core processes around the informational needs of these top people and then wonder why they can’t attract them.
Maximizing Quality of Hire is obviously more complex than described here, but if you don’t build quality in at the beginning of the process, you won’t find it at the end. Desperation or normal business pressures will then force the hiring manager to compromise, hiring the best person who applied, not the best person available. I address more of the “how to” behind this in my new eBook The Essential Guide for Hiring & Getting Hired (January 2013). For now, consider that it took 30+ years for the U.S. to accept Deming and realize that building quality in at the beginning is a far better process than inspecting it out at the end. Let’s not waste another 30+ years to realize that the cost to maximize quality of hire is also free