Thought Leadership: How to Improve Quality of Hire
By Stefan Peetroons, Management Consultant, at Accord Group Belgium
This blog post was first published on LinkedIn Pulse
A lot has been written about what’s trending in recruiting. Let’s explore why improving the ‘quality of hire’ will remain a going concern in the year ahead and how we can hire the right people more effectively.
1. What is trending in recruiting?
According to LinkedIn and CEO World Magazine ‘quality of hire’ is paramount. While the urgency to fill roles has made ‘time to fill’ increase slightly, quality of hire continues to be the most trending hiring KPI.
Also ERE Media, the industry leader in recruiting news and insights, outlines quality of hire as a top recruiting trend for 2016, before increasing speed of hire or the calculation the tremendous costs resulting from bad hiring decisions.
Another trend to watch for in 2016, as reported by Openview Labs, a collective group of industry experts, will be pipeline recruitment. The pipeline will need to be filled with the right quality of people.
In short, hiring for quality is a key trend, essential to effective recruitment and in need of improvement. Especially because, according to the LinkedIn’s survey, 2/3rds of managers are not convinced that quality of hire is handled effectively.
“The genius of investing is recognizing the direction of a trend, not catching highs and lows.”
John Bogle, Founder of The Vanguard Group
2. ‘Quality of hire’ and judgement
Usually, hiring starts from a function that needs filling. People are evaluated on qualities that are part of a competence profile, attuned to this function. Selection and assessment practices are put in place to guarantee the perfect fit.
Unfortunately, most assessments developed to assist in taking hiring decisions only have a limited predictive value. The cognitive tests have the highest validity, but even they have their limits because these tests are not coherent enough with the complexity of work. In addition, everyone involved in the hiring process uses their proper reference framework, based on their capability. Thus, everyone qualifies and disqualifies people for roles based on the complexity they are able to take into account.
When the complexity taken into account by the recruiter is situated lower than the complexity level of the role, the risk of a wrong judgement is high, because the recruiter cannot fully live up to the expectations of the role. The same goes for assessors and even hiring managers.
“When hiring key employees, there are only two qualities to look for: judgement and taste.”
John W. Gardner, President of the Carnegie Corporation
3. Judging work and person on the same scale
Selection is about increasing the quality of hiring decisions. However, when they are wrong, they can lead to value destruction and costly resignations. To increase quality of hire, it’s essential that the hiring method allows for a judgement on the same value scale for work and person.
By determining the level of complexity of a role and the corresponding mental processing ability (termed: capability), we can know the level at which someone implicitly is able to function optimally.
This is the primary measure to consider.
The measure in which this capability will also be used effectively on the job will furthermore depend on:
(1) the appropriate knowledge and expertise level of the person,
(2) the motivation and values of the person and
(3) the way in which dysfunctional personality traits are present.
4. Improving ‘quality of hire’ in three steps
Having determined the level of complexity of the role:
Is the person able to understand and shape the role in all its complexity, and address the role’s challenges appropriately? What is his or her mental processing capability?
Does he or she have the personality traits, talents and drivers that will enable him or her to align with his or her environment? Does the “being” of the person fit the role and the company?
Does the person have the required knowledge and experience that will allow him or her to utilize his or her capability and personality, talents and energy to the fullest?
It’s important to indicate that when complexity increases, capability gains in relative importance while knowledge and experience lose in relative importance. For the simple reason that the unknown cannot be solved with what is known but rather with one’s ability to give meaning.
“We cannot solve problems by using the same kind of thinking we used when we created them.”
Albert Einstein, Professor of Theoretical Physics
5. The value-adding headhunter’s role
According to HBR finding the right people is a top concern that keeps CEOs awake at night. Headhunters assist them, but their contribution is not only in finding the right leaders. It’s also in protecting from bad hiring decisions and improving the quality of hire.
As we are in the midst of a changeover from an experience economy to a meaning economy, a person’s capability (ability to give meaning) becomes essential to improve the quality of hire. In this economy, headhunters who differentiate in this respect continue to add value.
Whoever thinks that the headhunting market is saturated because of the internet, should think again. For many years, the headhunter’s role existed in finding people that were invisible at first sight.
Today their role is in finding the most complete person able to manage the required complexity, because they are all visible and disappear in the masses and companies do not want to take the time to search through these masses or are in the process of developing better hiring practices.
“People are not your most important asset. The right people are.”
Jim Collins, author of Good to Great and Built to Last
6. The essence of ‘quality of hire’
Being able to deal with complexity and to give meaning to the presented reality likely becomes the factor that will be required most to improve quality of hire. Improving quality of hire thus means hiring for mental processing capability.
Improving the quality of hire also means considering the manner in which the future potential of an employee is usable in the future, given that our mental processing capability continues to evolve over time.
The manager who strives towards sustainable development of his or her team, department or organization will have to adjust the hiring policy, judge work in terms of complexity and align the mental processing ability of the job holders.
We can read a lot about trends these days, but few actually follow up to prepare for even one of them. One trend stands above all: quality of hire is paramount. And he or she who works on his or her next HR plan should consider mental processing capability to improve the quality of hire.
By using this capability as the primary measure, one of the major advantages is that you are able to judge role and person from the same value scale, allowing you to integrate and align strategy, organization and talent development.
About Stefan Peetroons
Stefan is a consultant at Accord Group Belgium. Our vision is to be a source of inspiration for people and organizations to stimulate the development of their identity. Our mission: building resilient organizations where people, work & strategy are balanced with the purpose to create value.