Principles for Hiring Good Employees

Interviews, or How to Fuck Up Hiring

There’s a nice article here on interviewing, it’s short and sweet, but pretty much sums up my views on the matter entirely. The TLDR of it is, you’re wasting your time with interviews unless they are structured, consistent across all candidates, and aimed specifically at assessing skills you know are required for the job. If you do all of that, then you’ve slightly decreased the chance you’re going to fuck up, but only slightly. Which means you’re probably better off not interviewing people at all, and just testing for intelligence and skills.

Oh yeah, and there’s no point in doing references either. I’ve yet to see a single study which pegs their reliability at over 20%, which means they’re only predictive of job performance 20% of the time. The other 80% of the time they have either no predictive power, or are telling you the opposite of what’s going to happen. But recruiters and hiring managers and HR departments keep using antiquated bullshit ineffective methods for hiring people because… Well because they usually don’t know any better, don’t want to know any better, and even if they do know better, their boss would fire them for not using those techniques because s/he doesn’t know any better.

More “Recruiting is SALES!” Bullshit

Here again, and predictably on LinkedIn, we have more Recruiting is Sales! nonsense.

First off, while the market has shifted a little, the labor participation rate is still absolutely fucking dismal, and many people are still under employed, or in jobs they hate and want to leave ASAP.  The market is not that good, and it is not a candidate driven market.  There are still way more people who want jobs than jobs for them to have.  Employers were bitching about a candidate ‘shortage’ when unemployment was over ten percent, so give me a fucking break on this shit already.  Please.

Second, what’s not mentioned once in the post? Honesty!  No, you need to get people excited about your Opportunity!, whether or not it’s something to be excited about is another matter.  This leads to a massive problem for companies: the branding gap.  There’s how they brand themselves in general, and with regard to specific jobs, and then there’s the reality, and the distance between them is the branding gap.  And, for most companies, it’s absolutely fucking massive.

The reality is most people don’t love, or even like their jobs, and never will.  The division of labor and comparative advantage dictate that what you have a passion for is not very likely to be where the market directs your efforts as most valued and most productive.  In reality people don’t follow their passions for the most part.  If they’re lucky they learn to get passionate to varying degree about what they do, for most what they do is mildly enjoyable to tolerable, and they’re willing to do it for a good while.  Most people work to live, they do not live to work, and trying to hire only people who live to work is a recipe for abject failure.

Reality and honesty are the two things that never get introduced into the recruiting process, and which are desperately needed in there.  Less bullshit Sales!, more raw reality.  You’re not going to get someone excited and passionate about an order entry job.  The guy who cleans the toilets generally does it to earn money, not because he loves other people’s shit.  So, my advice to companies is very simple:

Do an honest assessment of your culture using a third party who can measure it via some objective framework.  You will hear things you don’t like, if you gloss them over or ignore them, you will fail.

Do an honest assessment of your salaries and benefits offered.  If your salaries are low, raise them.  If you can’t raise them across the board, raise them in a targeted fashion for top performers.  If you can’t even do that, you have to deal with the fact that you won’t get or retain top performers.  They know what they’re worth, they will go elsewhere.  There’s no reason why anyone should be killing themselves to work for you to get compensated at the same rate they would be elsewhere for just showing up and having a pulse.  Don’t like that?  Too fucking bad, it’s reality.  Do the same assessment with all other benefits like PTO and health, if you’re significantly below average this will lead to problems no amount of Sales! bullshit will be able to offset.

If you’re working your employees consistently more than 40 hours a week, cut back.  You are burning them out and will deal with higher turnover as a result.  Don’t like that?  Once more, too fucking bad, it’s the way the world works. There’s about a billion years of accumulated evidence to support this at this point in time, get the fuck over it.

Assess the actual desirability of working at your org using a tool designed for doing just that, a recruiter named Keith Halperin developed one just for that purpose.  Accept the results for what they are, if you are the private label toilet paper manufacturer that offers no PTO and low salaries, and you’re located next to Google, you are not going to poach their employees.  Fucking deal with it.

Now, armed with all this information, go after the candidates you can actually attract and retain.  Use structured interviews, do not trust your gut because it’s wrong.  Use validated tests of intelligence and integrity, and put the metrics from the interviews and tests together to view each candidate through something resembling an objective framework, and hire the best people you can out of the pool you interview.  And, above all else, do not use bullshit Sales! techniques to try to convince these people that working there entails something it doesn’t.  They will see the mismatch within minutes of being there and leave ASAP.  Long term relationships are built around honesty with diplomacy and tact thrown in for good measure.  If you work in a shit hole, you need to hire people willing to work in a shit hole, which are generally people who know they can’t get better jobs.  If you work in an average organization, you will get average people.  There’s no shame in this, the population of the world is mostly average by definition, myself included, and we do just fine running the majority of companies on the planet by showing up and doing our jobs reasonably well.  And if you’re lucky enough to work at one of those A+ corps, well you’re set and don’t need advice.

Point being, you’re not going to outsmart the market with Sales! bullshit without first taking a good, long, honest look at what you’re truly offering.  Ferrari doesn’t market the same as Honda, nor do the makers of those weird little cars they use in the third world market the same as Honda or even Hyundai.  And you need to know if you’re hiring for a Ferrari company, a Honda one, or a rickshaw one before you start trying to get a Ferrari candidate excited about working in a rickshaw company.  Because it’s not going to work long terms between you two, trust me.  There is an aspect of sales to recruiting, but it’s well past time recruiters dropped this Recruiting is Sales! bullshit and started learning from other fields, like supply chain and production planning.

Good LinkedIn Post

Definitely worth reading this, I’ll comment on it later, but I wanted to get it up here when I saw it.

Update: Ted makes some good points, but I think he misses the underlying problem: Sales!  The problem with sales, and specifically sales people, is they are detached from reality.  Sales people are notoriously disorganized, and they are ridiculously positive.  They are positive in the face of the most horrifying adversity.  Now, in sales that’s a good thing.  The problem is in any non-pure sales position, and especially one that requires management of any kind, it’s a recipe for utter failure.

Being positive all the time means a psychotic disregard for opportunity cost.  Sales people will pursue every method to make a sale, and the one time out of a hundred it works, they’ll say, “See, see, I told you it works!”  And they will ignore the costs of the 99 times it failed, even if the cumulative cost of those failures is  greater than the profit for the one success.  And if you have an industry controlled by sales people, like recruiting, it will be ridiculously slow to change, its participants will be psychotically averse to admitting error, they will all be psychotically averse to criticism and evidence based approaches that question the validity of their methods, and none of them will see a problem until it is so huge that it’s ready to destroy them.

That’s basically the state of recruiting today.  It’s dominated by agencies, those agencies are in the main run by Sales! types who will bend over backwards to fellate  the Almighty Client, however ridiculous and moronic their demands are.  When objective reality intrudes into the situation, they get confused at best, petulant and obnoxious at worst.  For example, if the prevailing wage for an Account Receivable person with 5 years of experience and a degree is X, and the Almighty Client wants one at 50% of X without compromising any on the person – same requirements for education, experience, etc. – it’s not a moronic white elephant hunt.  Nope, it’s a ‘challenge.’  The client is ‘challenging,’ not a fucking idiot.

Right now, the hiring process is essentially controlled by people who think it’s a pure sales process, when in fact it’s more of a supply chain process.  The Sales! types always want to concentrate on intangibles; culture, chemistry, job satisfaction, etc., etc., etc.  They never want to concentrate on objective reality: skill set and measurable ability within it, company structure, reporting relationships, time frames for delivery, etc., etc., etc.  Nor do they ever, ever, under any circumstances, want to talk about price, otherwise known as wages.  Because the Almighty Client doesn’t want to pay them, and therefore you’re not getting any.

We need to get the Sales! types out of control of the recruiting industry or it will die a spectacular death from them pushing it too far, pushing salaries too low, indulging the ridiculous requests of Almighty Clients who want people at rock bottom wages for 80 hour weeks, no benefits, no time off, etc., etc., etc.  People will get fed up with the bullshit and eventually hiring will come under the thumb of some bureau of the government who regulates every aspect of it, and quite frankly if this profession can’t kick these assholes out and get its collective shit together, we deserve no less a fate.

A Article I Commented On

There’s an article here at that I decided to comment on.  Here’s the comment:

“‘It’s weird that we haven’t built any tools for team leaders at all,’ Buckingham says. ‘We have none – not even a few good ones. We have zero.'”

Team leaders themselves are employees, and at the root of this disengagement problem is the fact that companies do not actually value their employees. That’s why they don’t have the tools they need. Companies say they value their employees, they give lip service to doing so, but this value is not reflected in their actual actions; pay offered, benefits offered, work-life balance, having skilled managers, and opportunities for development and advancement. You have to actually have all those things to get people engaged, not just mention them in a speech every now an then but never deliver. Rhetoric is not enough, we are in the information age where reality trumps Sales! oriented rhetoric of promises with no follow through, and people can increasingly see through the BS on a shorter and shorter time scale. It takes them far less time these days to realize their CEO is full of crap.

As long as companies fail to deliver on the things that will create engagement, they can measure it all they want and it won’t get better. As mentioned in the article, you can’t make a pig fatter by weighing it more often. So, the message to companies who want to increase engagement should be, pull your heads out of your posteriors and start taking actions that will increase engagement instead of endlessly fussing about it, but not doing anything about it. Most will do nothing, because increasing engagement will mean addressing and valuing employees’ concerns which may not seem immediately tied to bottom line improvements, because few if any companies tally the cost of disengagement and factor that into their financial judgements. But, it’s an easy start.

Step one, examine your salary structure and make sure people are making market wages, perhaps pay more if you think you need to compensate for things you can’t deliver, perhaps a bit less because of other perks you do offer, but there can’t be a massive disparity between your pay and the market mean, or you’re screwed.

Step two, examine your benefits and again, make sure they are on part with the market. This is an area where you can make a big dent because while time off is not very costly to offer, it makes a huge difference in people’s lives. Examine your health plans, time off plans, and work hours, and make sure they are all reasonable from an employee’s perspective. Try adhering to it yourself, and if you can’t do so without availing yourself of the perks of ‘flexibility’ offered to higher-ups, how the hell do you expect them to live on it? If people are working significantly more than 40 hours a week on a consistent basis, find out why and put a stop to it, or they will burn out and turnover, plain and simple. If your vacation plan is the standard plan of Go To Hell, Get Back To Work, revise it. Talk to a few brokers and see if you can get better health coverage if that’s a factor as well, it’s not hard.

Step three, start looking at your existing employees as resources and start considering advancement and succession planning. The institutional knowledge they have is often priceless, so capitalize on it and actually try to retain them proactively instead of waiting for their resignations and then wondering what happened. This can dramatically cut recruitment costs by shifting the need to back filling more basic positions. Always exhaust the internal pool of all possibilities before hiring outside.

These are not hard, and if done would correct most companies’ engagement problems. In many cases they’re not even costly, and yet companies still refuse to do them. That is an indicator of how much they actually care about engagement. In simpler terms, they don’t care, or it would be dealt with already.

New Year, Usual Shit

This past Friday I had a request from one of our clients for interview availability for two candidates.  Dutifully, I got availability from both for Monday and Tuesday, and of course never heard back from the client.  We all left for the weekend, I sent emails to both candidates saying that since we didn’t hear back to consider Monday off, and we’d aim to schedule something for Tuesday when Monday came around.  And of course the client emails my account manager at 10:30 PM on Friday wanting to set up interviews for early Monday.

To be frank, it’s this level of incompetence that is destroying the US landscape.  The assumption that people don’t have lives and are on call 24/7 has got to fucking stop.  Back in the sixties and seventies if you couldn’t get your job done in 40 hours, or for some reason insisted on working 70 hour weeks, people wondered what the fuck was wrong with you.  You were considered either inefficient, because it shouldn’t take 70 hours to do the job, or you were considered weird as fuck for not having enough of a life such that you could work 70 hours a damn week.  In Germany this is still the norm.  However, here in the US, ever since the silicon valley boom where the 40 hour work week was supplanted by the 70 hour work week thanks to a bunch of borderline Asperger’s types having nothing else they wanted to do but fuck around with circuit boards, that’s now considered ‘the norm’ in the US.

And, of course, this will reopen my employer’s repeated ‘requests’ I put work email on my private phone.  Because, of course, they want you to be available twenty four hours a day, seven days a week, but won’t provide you the tools or infrastructure to make that possible of course.  Oh no, use your own stuff which you pay for to do that, of course.  And since the ATS system we use is a relic from the 90s with no web access, it wouldn’t even really matter if I had access to email because at most I’d have past emails from the candidates, but no access to alternate contact info, unless of course I doubled up and created my own damn database from scratch in Excel to store information – twice – which is already in the work database but not accessible because it’s an antique piece of shit.

In world were people have no boundaries and more and more people are these lifeless fucks with no families or friends to spend time with, so they insist on making work their life instead of letting work support their life, it’s getting harder and harder to be a normal damn person.

I am preemptively posting this here since somewhere critical comments tend to disappear or not get posted on  I have no idea if this is on purpose or just a glitch in their Disqus implementation, or if authors control their own comments and differ in what they allow, but I’ll always double post from now on because I hate typing these things out and then losing them.  This weekend I plan on writing a more detailed response to the Good Corporate Citizenship article from a while back.  The below is a response to this more recent article on how passive candidates should behave.

The difference is, the passive candidate has a lot more leverage than the active candidate, as it is clear that an employer needs to lure the passive candidate away from a job they are already comfortable with.

This is actually incorrect. All positions have a budget, and usually a salary cap associated with them, and this is not an official budget or cap, but that which is dictated by the capital return based on the company’s ability to utilize a person. A passive candidate has a little more negotiating power than an active candidate, or so it’s assumed, but at the end of the day there will be opportunity cost for every extra dollar invested in any particular hire’s salary, and pulling a super star passive candidate doesn’t necessarily benefit your business when you have to pay significantly more for them. This squeezes the ROI for the position, and that’s assuming you can actually utilize them to their full potential. Most companies can’t, because most companies are managed in an average to poor manner. In essence it’s like buying a Lamborgini for your daily commute over winding roads through stop and go traffic. You’ll pay more initiall, and use a ton more gas, and while the Lambo is great for open road driving, its gearbox sucks in actual traffic. Its performance is hindered due to the circumstances under which it is being used. The same goes for superstar candidates.

Another analogy would be to look at your company as a production line, and to consider where the rate limitation is. If the up-line is only producing 10 widgets an hour, and has no real hope of exceeding that, then you’re wasting money on any down-line equipment with a much greater capacity. Now, there may be plans to upgrade the line, but in terms of a workforce that’s a long haul, and most companies are not making that investment these days, at least that I’ve observed. All told, the supposed higher productivity of a ‘passive’ candidate is only of use to you if you can utilize them to their full potential, and every dollar you spend to get them above and beyond what you would have paid for an active candidate squeezes your ROI and demands that you utilize them at a higher potential to get the return you need. Earning 10% on a 60K candidate means 6K profit. Earning 5% on a 100K candidate means 5K, and half the actual margin. Spending more doesn’t mean you get more when it comes to investment. Most companies aren’t Lamborgini companies, as such, they should probably get the Honda model. The margin is actually better, and the profit higher, on a more appropriately utilized employee than one with massive potential thrown into a mediocre situation.

I would also pose these questions, regarding Katherine’s hypothetical experience. If her current company really does value her, why are they not offering a comparable salary? Why did they not proactively raise her rate to what she could get from a competitor in an proactive bid to keep her? Would her company show her as much loyalty should she come into health problems and go on FMLA, or require off time? Or, more to the point, would they should such loyalty should their bottom line start to indicate her salary should be cut, or her entire position scrapped, not due to her performance but to the company’s own lack lust performance, more appropriately laid at the feet of her managers? While Katherine’s hypothetical current employer seems wonderful and may in fact demonstrate loyalty, most real world companies will ditch you in a second if keeping you meant sacrificing a fraction of a percent to their bottom line. A job is a mutua exchange, that’s all. The employer gets a work product they want more than the salary they pay, the employee gets a salary worth more to them that what they produced or the time it takes to produce it. Neither one owes the other anything, and in the real world the only people who do usually show loyalty are the employees, not the employers, whose loyalty is first and foremost to their profit above and beyond their employees by such a wide margin it may as well not exist.

Companies are not guided by ethics, but by profit. So should employees be guided. Keith Halperin is right, and employees should act like CEOs, and companies should stop bitching and moaning about loyalty which they never reciprocate on, and start treating and paying people well from the get go if they want to retain them, instead of only addressing the issue when they’re already leaving. The sad truth is that companies that act like Katherine’s hypothetical employer are so rare they may as well not exist. As a practical reality employees should not strain themselves to do the right or ethical thing by employers who will never spare a thought for doing the same by them. Employers have enough of an edge in the market without employees giving them even more based on one-sided assumptions of loyalty and ethics which they will never see returned to them.

Employees should get as much money and perks as they can, and then ditch their employers in a heart beat when they’ve made a prudent judgement they can get more, because their employers will do exactly that to them. Tit for tat, employees treating employers as badly as employers have historically treated employees is the only way the labor market will ever balance itself. As long as employers see their employees as disposable, employees should reciprocate.

Another Denied Comment

I like, but they definitely seem to put a stranglehold on the comments to make sure everything is nice and shiny.  Here’s an article they put up concerning dress code, and my response:

The problem is that people latch on to something like dress code, which may or may not influence performance, and define that as performance in and of itself, and this leads to the focus wandering from actual performance. Which is what leads to ridiculous situations like two employees of roughly equal performance getting different raises because one wears suits and the other just collared shirts, when their revenue impact on the company was in fact equal.

“Why did Joe get a better raise than me, don’t we produce at roughly the same levels?”

“Well, yes, Jimmy. But you see, Joe wears extraordinarily uncomfortable clothing, including wool suits in the middle of summer, and is always sweating like a hog, unnecessarily so, yes, and I can’t quite put my finger on why that should actually matter, but he does it, and it does matter… for some reason, and he blows most of his income on his wardrobe rather than rent and food for his kids, so therefore he must be a better performer on some level than you, regardless of what the actual metrics say…”

Dress will influence people to varying degrees and in different ways, which is exactly why it has nothing to do with performance and should not be a part of a performance requirement, because one standard does not fit all, nor work for all, and imposing one standard will then by definition narrow the pool of people who can and will be successful in your organization, which limits your ability to be productive. How in any way shape or form is that beneficial to a company, to hinder or in fact close off access to an entire portion of the labor pool because they don’t like wearing a full suit? Maybe with rising prices everywhere for food and gas and housing the last thing many people want to hear is they have to blow half their income on fitted suits for no perceivable objective reason other than the fact that the boss wants them to.

So keep it simple. Define performance in terms of actual work product – what needs to be done, when does it need to be done, and to what quality standard – and manage to that as your standard of performance. Dress code, aside from being clean and presentable and not smelling like ass, will most likely not be a part of that. I think most people will find it utterly amazing how productive their workforce gets when they stop trying to run their employees’ lives to the minutest degree and just concentrate on what’s expected of them in terms of their deliverables at work.

Dress code is like any other irrational and useless metric that’s there for no discernible reason, and it’s mostly used as an excuse for incompetent managers to prove they are managing!, even if it’s connection to actual employee performance is tenuous to nonexistent. Reply

Since keeps deleting my reply to Art on this article, I figured I’d post it here.  Just got back from a Caribbean trip and catching up with work, missing the blue water.

Reply to Art:

I think you missed the point, Art. The title of the article is, “Is Passive Talent Better Than Active Job Seekers?,” and is not asking whether or not a passive strategy is a good, and sometimes necessary thing, which it is. However, the incessant harping on passive! talent by many recruiting ‘thought leaders’ leads to just that problem: people think ‘passive’ means ‘better.’ It doesn’t. It just means the person in question wasn’t actively looking for a job when they were contacted.

The best qualified person is the one who performs better, it doesn’t depend on how they were sourced. The correct approach is to always employ both active and passive strategies to varying degrees, depending on the needs of the particular position as in the situations you mention, and pick the best person from the pool of people you get regardless of how they were sourced.

The problem at base is that thanks to the incessant harping on this issue it has been reframed in the minds of many people outside the industry as passive = inherently better, when in reality it’s just a marketing distinction to delineate strategies for reaching as wide a candidate pool as possible. It is not a determinant of job performance. But, that’s how many see it. That’s the problem, because people then pass over ‘active’ candidates who could very well be superstars because, well hell, they’re not passive!, so how good could they really be? Hell, they’re looking for a new job.

After all, we wouldn’t want to employ anyone who actually wants to work for or with us, would we?

Article for Review

It seems one of my comments inspired an author to write a whole new column.  I plan to have a response up here soon.  I have various points of agreement and disagreement with the author, I’ll get them up here over the next few days.  This column is definitely worth a read though.

Advice for Hiring Managers and Owners

Consider your off time policy.  Consider this: in other countries there are mandatory amounts of off time imposed by the government.  Usually anywhere from 20-30 days, more when mandatory holidays are counted.  In the US, nothing is mandated, at least not yet.  Based on my own experience people in the US average 15 days of ‘off’ time including vacation and sick time.  I put ‘off’ in quotes because, during that time, they’re usually still working.  They’re on the phone, they’re checking email, they’re not working at 100% capacity, but they are still working.  Speaking with someone from Europe, if you ask, “Who does your job when you’re not at work?” the standard answer would be, “No one.  I start working again when I get back from vacation…”  Also, they often don’t take all their vacation.  Realistically they’re looking at two weeks off if they’re lucky.

Put simply, people in the US are starting to get pissed.  I don’t agree with socialism as a way to do things, but the simple fact is they have proven that your workforce doesn’t need to be on call 24 hours a day, 365 days a year.  Your company will not crumble to dust if someone goes on vacation for a week.  Also people in the US are increasingly aware of how badly they’re getting fucked in this area.  The workforce is globalizing, information is certainly flowing, I’d recommend hedging your bets and offering something now before it gets mandated.  This country is increasingly heading to the left in a lot of ways, pretty soon I don’t doubt we’ll have true single payer healthcare among other things.

Now, here’s some math to show you people how stingy you motherfuckers are.  There are approximately 2080 work hours in a standard year.  Two weeks total time off is 80 hours, or approximately 4% of the overall time.  Four weeks of off time, or 160 hours, would be approximately 7.5% down time.  This is not a major amount of time.  Christ, I’ve seen maintenance schedules for manufacturing equipment that give the fucking machines more ‘vacation’ time than the people that maintain them.

For more exact numbers:

One week of off time is 1.92% of the total work year.  Two weeks of off time is 3.85%.  Three weeks of off time is 5.77%.  And four weeks of off time is 7.69%.

When you own a machine that manufacturers widgets you know it’s limits, you know when it needs ‘off time’ for maintenance, and you know pushing those limits means potentially losing a valuable resource to wear and tear.  Why is it you people don’t realize the same applies to your employees?

Take a fucking hint and give your employees a break, literally.  Stop working people until burnout and then replacing them when they fail.  It’s inhuman, it’s poor business strategy, and it’s just a plain old dick move.