Monday, January 28, 2008

Hiring Without Firing

Hiring Without Firing: Key ideas from the Harvard Business Review article by Claudio Fernández-Aráoz

The Idea
Astonishingly, between 30% and 50% of all executive hires end in firing or resignation. Why is hiring particularly problematic—and critical—today? Global hypercompetition, the breakneck pace of economic and technological change, and ever-shifting organizational structures are key reasons.

Also, today’s work success depends increasingly on intangible competencies—like flexibility and cross-cultural literacy—rarely found on résumés. And as demand for talent is sharply increasing, supply is steadily shrinking.

Most companies make ten dangerous mistakes during the executive-search process, including having unrealistic expectations, believing references, and conducting seat-of-your-pants interviews.

Here’s how to systematically avoid these traps.
The Idea in Practice
Ten Deadly Traps
1. Reacting: hiring someone too different from the problem person just fired.
2. Unrealistic expectations: demanding many contradictory qualities, like “high-energy doer and thoughtful analyst.”
3. Evaluating people in absolute terms: “Joe is a good manager”—without clarifying that he manages processes well, but not people.
4. Accepting people at face value: not getting the full story of a candidate’s background.
5. Believing references: trusting references’ input without determining their credibility.
6. “Just like me” bias: highly rating candidates who are like you.
7. Delegation gaffes: assigning critical steps in the search process to ill-prepared staff.
8. Unstructured interviews: no prepared questions to reveal candidates’ competencies.
9. Ignoring emotional intelligence: failing to assess candidates’ self-awareness, motivation, empathy, and social skills.
10. Political pressures: inappropriate agendas, such as pressure to hire a VIP’s friend.

Hiring Well
Successful—and systematic—hiring requires these three steps:
1. Define the problem you need to solve through hiring.
• Clarify the position’s current and future requirements, driven by your firm’s strategy. Translate them into needed skills (e.g., comfort with uncertainty).
• List required competencies in behavioral terms and get consensus on the list (e.g., “strategic vision” means the ability to inspire and guide others).
2. Creatively generate a candidate list.
• Contact people who can recommend several quality candidates (e.g., a major supplier CEO to recommend sales leaders).
• Consider unconventional candidate sources. (One president hired a director whom his predecessor had fired!)
3. Methodically evaluate the candidates.
• Conduct structured interviews in which you assess candidates’ competencies through behavior-based questions (e.g., to measure team skills, ask, “Tell me about a time you led a particularly challenging team project.”).
• Meet with references in person if possible. Describe the open job and ask pointed questions (e.g., “How has the candidate performed while facing similar challenges?”).
This HBR in Brief presents key ideas from a full-length Harvard Business Review article.

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