Assessment Leaders Monthly

"The trouble with using experience as a guide is that
the final exam often comes first, then the lesson."
~ Anonymous

TOP EMPLOYEES...OR TOP CANDIDATES? WHICH DO YOU SELECT? BY TIM BRENNAN
Peter Drucker has said, "Executives spend more time on managing people and people decisions than on anything else, and they should. No other decisions are so long-lasting in their consequences or so difficult to unmake and yet, by and large, executives make poor promotion and staffing decisions. By all accounts, their batting average is no better than .333. At most one-third of such decisions turn out right; one-third are minimally effective and one-third are outright failures. In no other area of management would we put up with such miserable performance.”

In a sampling of management workshop participants, we asked, “Do you agree with Drucker?” We found that most do agree and they provided an additional, important insight: just because the hiring decision turned out to be a mistake, that does not imply that the person hired left the new job. Although in many cases, the new hire falls short of expectations and should never have been hired or he or she requires too much supervision — often they remain on the job because (for managers) accepting poor performance is easier than finding a replacement!

When we hire a new person to come into our business we share the expectation they will be the “right one,” or we would not have hired them. Why, then, are we so often disappointed?

Our research suggests the answer may be a missed point of focus. We are trying to find and hire top candidates rather than top employees. They are not the same!

In conversations with recruiters and employers across Canada, we have compiled this list of the characteristics of top candidates:

Consider this: using this list, would all of your top employees today be considered top candidates?

Did you notice there is not much overlap between the two lists? To improve your odds of hiring right the first time, give careful thought to the qualities of your top employees then look for those qualities in those you hire. A good assessment can help you measure both, instead of guessing!

WORKPLACE ABSENCES HIT FIVE-YEAR HIGH
According to Susan Ashworth, writing in the San Jose Business Journal, the rate of unscheduled absences has climbed to a five-year high reaching 2.4 percent in 2004. If you calculate the annual loss to the employer of 50 people who average $30,000 per year in wages and benefits, you get a number higher than the annual wage for one whole worker! Worse still are the other costs of absenteeism. One manufacturer calculated the increase in warranty costs when someone must fill in for an absent, highly skilled worker at 1,100 percent!

While Ashworth offers several worthwhile approaches to curbing absence, one very cost-effective method is to hire reliable people with good work ethic in the first place. The manufacturer cited earlier introduced the Step One Survey II™ to its hiring process and reduced unscheduled absences by 33 percent, with a total ROI of 785 percent.

RECRUITING IN A COMPETITIVE MARKET – GET AHEAD OF THE GAME
Recruiters, owners, hiring managers — how often have you tried to explain away an unsuccessful hire with “We had to fill the opening and we just didn’t have enough good applicants?”

If the answer is, “More than once!” you owe it to yourself and your company to get ahead of your hiring curve and build an inventory of qualified applicants to turn to when openings occur. If your application process is designed to gather the right information in the first place and then allows you to match the information to a suddenly-open position, you will seldom find it necessary to make a second-rate hire just to fill a seat in your organization.

Hint: a stack of several hundred paper applications will not get you there regardless of how many good candidates are buried within. To accurately and quickly identify potentially great hires, you will need a system which can store the relevant information in a searchable database and identify potential matches between jobs and candidates in seconds. Whether the process begins with a paper application and is entered into a database, or the applicant enters their own information online or onsite, effective searchability is the key. Your chosen system should allow you to seamlessly integrate assessment information into the whole. Then, your valuable time can be spent in identifying, qualifying and contacting qualified candidates and convincing them your job is the right one for them!

Obviously, it will not help you much if you discover most of your qualified applicants are no longer in the market for a job. Your system must include an automated update feature, so you create a pool of candidates who are actually looking for a new job, or at least open to the possibility, when you have one that is suitable.

A system that allows you to match a new applicant with your entire set of jobs is a great benefit in this process. You may not have an opening for a widget twister at the moment, but it is a job with high turnover. If you have a candidate who is a great match for the job, you may be able to keep their interest until it opens. You may be able to provide a temporary assignment until the inevitable opening occurs.

Build an inventory of candidates based on good and searchable information and you will find yourself ahead of the hiring curve, consistently making better hires — and apologizing a lot less!

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CUTTING TIME-TO-HIRE—LIKE GETTING EXTRA EMPLOYEES!
In many fields, the time interval between a job opening, hiring and break-even productivity is long and expensive. In capital-intensive industries like trucking and manufacturing, equipment sitting idle while a job is filled and a new hire is trained can be the difference between profit and ruin.

According to Jason Shaw, a University of Kentucky professor specializing in the trucking industry, Southeastern Freight Lines faced precisely that challenge. They responded by implementing an integrated application, assessment and background check system, already cutting time-to-hire by 40 percent! The online-only process also increased the sheer numbers of applications they received, by nearly 500 percent! They discovered that Sundays, under the new system, became the heaviest day of application traffic. Placement of hiring kiosks in their service centers also helped boost applications.

Reducing time-to-hire, especially when it also produces new employees who are better suited to their jobs, is like getting extra employees. For Southeastern Freight, it meant less idle equipment, higher productivity and improved profitability!

Local and regional hiring managers are enthusiastic about the system, as they are able to focus their time on high-payoff activities instead of paper-shuffling. Executive level managers like having an effective tool to evaluate the performance of the regional managers. Finally, applicants must like the system, based on the increased number of applications!

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GETTING IT RIGHT—THE IMPORTANCE OF LOCAL SUCCESS PATTERNS
The process of identifying, hiring and coaching people who are very similar to employees already successful in a job has gained widespread acceptance over the past decade. If we can successfully model “top performers,” we are likely to improve our success as people managers, compared to other common models for improving selection and performance. A common pitfall lies in the deeply imbedded belief that if someone is successful in their field, they will be successful wherever they are employed to pursue that field.

Probably nowhere is this philosophy more deeply ingrained and destructive than in selection and development of salespeople. After all, if someone knows how to sell, they can sell anything, anywhere, right? Unfortunately, this is wrong!

While certain characteristics, behaviors and interests may be held in common across many successful salespeople, the local selling environment is the key to good job match. Management, product, client characteristics, compensation and even the local culture may be more important than those shared factors in determining productivity and success.

Consider the two success patterns below from two different companies in the RV industry. Each was developed using the Profiles Sales Indicator™ (PSI), each by identifying top producing salespeople with more than one year in the top five percent of each company’s sales force. Most of us might expect a great deal of similarity in these two patterns and history shows these two companies regularly raiding each other’s sales forces, assuming success in the competition’s store would predict success in their own. In fact, one of these companies looked back over a five-year history of sales reps recruited from the other store. Of eight salespeople “stolen” from their competition, only one had stayed on the job more than nine months, and that one had remained a “middle of the pack” producer for nearly two years before moving on.

A look at the two patterns sheds a great deal of light on the reasons for the failure of the “raiding” method of selection. While success at either company requires persistence from midrange to very high and self-reliance is only moderately different between the two, competitiveness has no overlap at all! A highly competitive salesperson who was “top performer” at Company A would be very unlikely to succeed at Company B. A greater discrepancy is found in the energy level required for success at each operation!

As a side note, sales managers often think they would like to hire people who are “all 10’s” on these scales. While such a rare individual might succeed at Company A, they would likely fail miserably at Company B!

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Terrorist Tools for Private Employers
With the recent events in Europe, private employers may revisit the issues associated with keeping terrorists out of their workforce. Employers in sensitive industries, or involved with the country’s basic infrastructure, need to take appropriate measures to prevent terrorists form becoming employees.
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Large Retailer Sued Over Failure to Screen
The need for employers to exercise due diligence in hiring was underscored recently by a lawsuit against retail giant Wal-Mart. According to a June 17, 2005 article in the Arizona Republic, a Phoenix law firm filed a suit against Wal-Mart for the negligent hiring of an employee who was accused of molesting several young girls, ages 3 and 4, in a store in Scottsdale.
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Group Dedicated to Memory of Murder Victim Urges Background Checks for All Home Service Workers
On August 27, 2001, a worker sent by a well known home repair firm raped and murdered Sue Weaver in her home and then set the home on fire to destroy the evidence. Her killer was a twice-convicted sex offender that had been hired six months prior to clean her air ducts.
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