What problems in the recruitment process are you trying to solve with the performance based hiring approach?
For me, the main issue is the fact that the hiring process is the only business process that isn’t a process. People tend to optimize each of the individual components but not the overall process. Companies define work using a job description which doesn’t work at all, since in most cases it ends up being a person description (Use KPO’s instead of list of skills).
Recruiters look for candidates who meet the description, but not for candidates who are confident and motivated to do the work. People interviewing using a lot of tools but do not recognize that the best candidates do not want to get interviewed that way, instead they want to interview the company at the same time. So, if you don’t look at this process from a systematic perspective, each of the individual components gets optimized but the total process gets sub optimized.
If you don’t think about the totality of what you want to achieve, which is hiring great people every time and respect the fact that different people have different set of skills and they are interviewing you at the same time you are interviewing them, you are going to get the wrong answer.
Unfortunately, companies want to take shortcuts by optimizing one segment, is it sourcing, job identification, interviewing, closing but miss the big picture which is that companies don’t have enough people at the top of the funnel. And performance based hiring has proven in thousands of cases to overcome this shortcoming by combining sourcing, screening, interviewing, and recruiting into one seamless approach.
How does performance based hiring looks like in practice? What would change for a company if implemented?
I can give you some impressions from a real case study. We are doing a project right now at a big company, which is trying to totally reengineer its hiring process for the sales department.
As a starting point we mapped out the whole sales process, so what does it take to be a good sales representative? From creating a lead to a business call, to presentation, to negotiation etc. We need to understand the job from beginning to end and clarify on what distinguishes the best people.
We then have to find people who wants to do that work, so people who are good in this specific job and see it as a career move. After that we need to get recruiters and sourcers on board, who cannot only find these people but also assess them properly. The next questions are, how do we make sure that the responsible people recognize a good candidate?
This requires a training of people through every step of the way. How do they handle negotiations giving the fact that the candidate wants more money, wants more of this or more of that and they still close the deal? And finally, how do we implement this in a performance-based hiring system?
That’s what it looks like in reality. It involves reengineering the process, defining the actual work, setting up the sourcing plans and define those people while always seeing it from the mind of a great candidate and the mind of a hiring manager who wants to hire the best.
We are building a HR tech conference, because we are believing in the advantages of a stronger involvement and implementation of technological solutions, analytics and data-driven decisions. What is your take on this in regard to recruitment?
You always have to keep the end in mind and set your metrics based on this. As a start you don’t need a lot of metrics but some very important ones which keep track and ensure that you have the right business process in place.
This connects to the first question and the answer is similar. Before looking into small improvements in subparts, it is crucial to keep track of your overall business process and this can be done by a few big metrics. Are the recruiters doing a good job of identifying the right people, contacting the right people, engaging the right people?
I personally believe, that if a recruiter can’t convert 20 people into 50% conversations, so 10 conversations, then there is something wrong. If these 10 conversations can’t be converted into a bunch of referrals on serious candidates, something is wrong. And if one or two people get send to the hiring manager and the hiring manager is not interested in hiring one of them, something is wrong.
In those cases, most hiring managers are asking for more candidates and the recruiter is searching for more candidates rather than both recognizing the essential business process problem, which you have when a hiring manager can’t hire any of the upfront selected candidates. There are not many metrics needed but these are some examples of metrics that must be tracked in order to assure to have the right process in place.
Many companies are looking into small details but forget the big picture, which simply is: Is our system the right system? Are our candidates liking the job? Are the hiring managers liking the candidates? And are candidates accepting the offers? If any of those questions is not approved, it is a business process problem and it is way more efficient to redesign the process. Ones you get the essential process right, it’s time to look deeper into diagnostics but as a start, you have to have the core process in place and running properly.
A common problem in the process of recruiting is the presence of biases and even when we are aware of it, unconscious biases often guide our decisions. Is artificial intelligence the solution to assure an unbiased process?
The bias starts with writing job descriptions that are not based on performance. If you are using AI to look for a group of people which have a list of requirements, you already induce biases.
How much experience does a person need to succeed in the job? – I don’t know – some people need more because they are slow learner, some people need less because they are fast learner. But they need enough to do the work, so you need to define the work. It is the work that determines what skills you need, not the skills that determine the work.
If you are using skill-based job descriptions, you automatically end up in a biased process and a robot will not be able to determine that. Here an example of a performance based job posting. The key is to search for people who are performance qualified and not skill qualified.
To answer your question, an AI system could be a solution, but it is not a simple solution. It would take a very advanced AI system, since the bias is induced way earlier in the process and it is not sufficient to just check a given list of skills.
Can human involvement in the hiring process ever completely be replaced by technology?
Most of the people don’t understand that recruiting is a two-way street with human behaviour and complex decision making on both sides of the table.
There is technological capability that could handle this, but it requires multiple layers of decision making and I think the current state of AI is far away from reaching this. It is well suited for hiring active candidates in routine jobs but for jobs that require complex decision making and creative thinking it is going to be tough to replace the human involvement.