The technology boom is driving a hiring frenzy, pitting giant companies like LinkedIn, Twitter and Google against small, scrappy start-ups in a battle for talent. Top candidates are able to negotiate four or five offers, with the same cash, equity and even project quality being put on the table.
How can companies optimize for this reality? It starts with data. And while everyone talks about how using data wisely can accelerate confident decisions, reduce costs and drive efficiencies, very few of the current generation of recruiters are applying Moneyball methodologies to their hiring and retention strategies.
Box started collecting rich data about the type of people who were successful in their roles. Google has been doing this for years, and it makes a lot of sense. Box supplements hiring processes with quantitative data (salaries, years of experience, years of education, etc.) and qualitative attributes (logic skills, adaptability to change, response to chaos, etc.). This means they know what they are looking for up front and minimize mismatches along the way.
Here are a few tips that modern recruiters should consider incorporating into their strategy:
1. Get personal. Companies can compete when they focus on building close relationships with candidates. If you start with a rich data set, understanding who you are looking for, you identify them quickly and can spend more time on getting to know them. That gives you the ability to personalize the hiring process.
Instead of setting up grueling hours of conference room interviews, Paxata gives candidates personalized experiences by setting up happy hours and dinners with executives and peers. Candidates have shared that this approach stands out among other organizations because they felt welcomed and get a chance to really experience the vibe and culture of the team they want to join.
2. Be quick about it. When you think about the market, traditionally, big companies move slowly. Use speed as an advantage against other employers who struggle to move candidates through a cumbersome hiring process. An efficient interview process can be the difference between snatching up your top choice or losing them to your rival.
Once you’ve identified a suitable job candidate, make sure the personnel involved are focused on having seamless communications and tracking for every handoff and signoff. With all the hiring tools available — from LinkedIn to Lever – losing track of candidates at any point in the process is completely unacceptable.
3. Find them and keep them. Take a data-driven approach to managing talent long after you hire someone. Box uses an Australian-based company called Culture Amp to power engagement surveys and find actionable ways to improve the work environment and culture.
For example, because of the survey, Box made it a priority to focus on improving internal mobility because their employees wanted to learn and grow their careers and explore new jobs without leaving Box. This not only helped day-to-day employee engagements, but is a huge benefit to the recruiting organization, which focuses on hiring internally before looking for talent outside.
4. Eliminate interview slop. Understand the importance of every interview and ensure that you have experienced, skilled interviewers who provide accurate, data-driven feedback. The best companies will focus on building strong interviewing skills early on because of how critical it is to making good hiring decisions.
Make sure everyone in the interview lifecycle understands their explicit role, knows how to ask the right questions and knows what they should be looking for in candidates. They should also recognize the importance of being representatives of the brand and culture.
As you start to apply smarts to the process, remember to collect data that is truly predictive of a candidate’s success in a new job. For example, project-based interviews that really shed light on a candidate’s work quality tend to be highly predictive. Most importantly, test impressions for biases so feedback is not emotionally driven.
5. Understand the composition of your team. Every company should have strong checks and balances in the hiring process to maintain incredible quality of hire, and then continued focus on how the organizations needs and composition shifts over time. Amazon has their renowned bar-raisers program, for example. Strong leaders will often fight against hires and push their teams to take on long-term views of talent versus settling for hires that fix short-term pain.
Make sure to prioritize diversity — both background and cognitive — early on in a company’s history. Doing so will allow you to build a strong cultural foundation that really encourages innovation due to different perspectives. If companies wait too long to do this, it creates a very difficult problem to fix.
6. Don’t blame the data. With all of the goodness you get from taking an analytic approach, make sure you truly understand data before acting on it. Correlation is not causation, so before applying findings, be certain about the causal nature of your discoveries and assumptions.
One of the biggest misconceptions that organizations, especially individual hiring managers fall victim to, is small sample size. Hiring is a very personal, human-driven process, but often times, people are making decisions based on patterns they’ve seen in very small sizes, which is really a set of random event data.
For example, companies may hire one or two stellar individuals from a particular company early on, and then desperately try to re-create the success by hiring more individuals from that company, when really, it wasn’t the previous company that led to their success, but rather other factors.
7. Act, Analyze, Improve…Repeat. Explore the possibility that traditional hiring and interview methods are broken. If you could re-invent the way your company did these, what would the process look like? How can you really collect accurate data about each candidate’s abilities, potential and cultural style.
This is a never-ending process of refinement and experimentation but will really help your company’s filters continually improve. The other thing is to require your company to always hire better and better people. Each new hire class should raise the average caliber of talent in your organization. Having this focus will prevent companies from falling into the trap of prioritizing speed and volume over quality.
Bottom line: organizations of any size who want to compete for — then win and retain — the best talent should look to data-driven methods that help them personalize their approach, move faster and smarter through the recruitment and selection process, and reap great rewards across the entire employment lifecycle.
By Prakash Nanduri, Co-founder and CEO at Paxata and Kenny Mendes, Head of Recruiting at Box and member of Paxata Advisory Board