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Quality of Hire: The Next Quality Program

by Dec 21, 2004

Process improvement philosophies define quality as that which meets the customer’s requirements. Six Sigma, for instance, uses a concept of reducing defects as a way to detail the customer requirements. To measure the quality of a process is to measure the output of the process for conformity to the customer’s requirements. In the case of a staffing department, the primary customer is the hiring manager. The key to measuring quality of hire, therefore, is to define the hiring manager’s expectations at the point of identification of the need for a new hire. There is, however, no overarching or universal standard of employee quality. Quality Programs Interestingly, little or no focus has been given to quality of hire in the popular quality programs. Formalized quality programs began in the 1920s with the Plan-Do-Check-Act (PDCA) cycle, a systematic approach to improving work process. “Total quality control” practices in the 1940s were followed (primarily in Japan) by the introduction of “quality circles,” which included all employees, not just department managers. American companies began to embrace the teachings of quality gurus (e.g. Deming, Juran, and Feigenbaum) by the mid 1980s. During the ’80s, criteria for the first Malcolm Baldrige National Quality Award was established; ISO 9001, Quality Systems-Model for Quality Assurance in Design, Development, Production, Installation, and Servicing was published; and Six Sigma was developed at Motorola. James S. Beard, president of Caterpillar Financial Services, recently made the following analogy in Quality Digest:

We’ve proven that Baldrige and Six Sigma complement each other well. The analogy we use is that of an orchestra: Six Sigma takes the trumpet player and makes her a world-class trumpet player, but in isolation that doesn’t necessarily make the orchestra sound better. Baldrige looks at how all the elements are working together to make beautiful music. Put another way, Baldrige helps identify where we need to go, and Six Sigma makes the improvements happen.

But who is in the orchestra to begin with? These quality initiatives grew out of manufacturing at a time when it was the predominant industry in the U.S.; hence, they are process focused. All acknowledge the importance of employees, yet none of the major quality initiative programs address what may be of utmost importance in today’s economy: the quality of hire. The quality of the hire comes before the employee can be part of any team or participate in improving any process. Talent Definition A quality of hire program begins with talent definition. To drive quality into a selection and recruiting process, the company must first define what quality is for each position in the company. The selection process must be grounded on the foundation of a proper specification of the requirements of the job. The staffing department must work with hiring managers to set out the criteria that will bring about success at a job. These include:

  • knowledge, skills, and abilities
  • attitudes and motivation
  • cultural fit, both with the organization and with its customers

The more specific the criteria, the better the company is able to calibrate the selection process and measure for a quality outcome. How to Measure Quality of Hire Once set, these criteria for the ideal candidate for a position inform all aspects of the recruiting process for the position, from the writing of the job description and the criteria employed by an online pre-screening function to the measurement of the quality of the hire. The criteria of selection and of performance must be aligned to ensure that the staffing process reliably selects qualities and characteristics that promote high-quality performance on the job. The comparison between pre-hire requirements and the new hire’s actual performance on the job may be made by:

  • Surveying the hiring manager
  • Consulting annual performance reviews
  • Measuring worker productivity and tenure directly

Close the Feedback Loop Similar to the standard manufacturing quality programs, a program of measuring quality of hire also must provide a means of evaluating the effectiveness of change initiatives as a company seeks continuous improvement in its staffing process. The ultimate best practice for staffing to improve the quality of hire is to use quality of hire data to optimize the staffing process. Such an optimization involves a rigorous “loop back” of quality-of-hire measurements to changes made in the staffing process. Optimization is a challenge for most companies: metrics must be accurate and dependable, and staffing procedures must be standardized in a consistent and repeatable process. Without a staffing process that is measurably repeatable to begin with, optimization will not have a starting point from which to improve the process. The challenges of defining and measuring quality of hire pose high enough of a barrier to some companies that they do not make the attempt. Still other staffing departments do not measure quality of hire because the company’s priorities lie elsewhere, such as with cost containment. However, great financial benefit to the corporation’s bottom line is attainable through focusing on quality.

This article is provided for informational purposes only and is not intended to offer specific legal advice. You should consult your legal counsel regarding any threatened or pending litigation.

  • David Scarborough

    Simply measuring quality of hire after the fact only tells us what has already happened. The real power of closed-loop analytics is the capacity to influence future hiring events.

    To the extent that applicant characteristics associated with post-hire performance can be mathematically represented and used to inform hiring recommendations, new hire quality can be measured and systematically improved. For economic and technical reasons, most staffing departments do not develop and code these equations into their hiring decision support system. As a result, improved hiring is left to chance.

    We believe that it is the responsibility of the service provider to conduct this research and Unicru has practiced on-line criterion validation for over half a decade. If your hiring management service provider does not ask for post-hire performance metrics on the candidates hired through their system, it is safe to assume that they do not conduct this research. The core of TQM and Six Sigma practices is systematic process improvement which assumes integration of statistical learning in an evolving system. Without this key component, hiring system accuracy remains essentially random.