Why You Are Not Ready to Talk About Quality of Hire

HR as a field sure loves to have a carousel of buzzwords that fade in and out of our conscience in 12-to-18 month cycles. Often those buzzwords are used as crutches to define value, without ever really producing value. Some recent examples: big data, passive candidates, gamification, etc. etc. etc.

My new returning favorite is quality of hire.

Quality of hire is a complicated measure with numerous data points that requires a significant amount of discipline around collection and analysis. In my experience, most organizations have been unable to figure out how to accurately collect and analyze something as easy as source of hire data and the associated ROI, so I’m amazed when companies swear they can get this right. Heck, I’m lucky enough to have one of the most sophisticated analytics capabilities and we struggle with true quality of hire. Of course, there are a legion of vendors out there ready with their “magic” solutions to do things for you to “increase” your quality of hire and even more ready to take your money to do it!

That’s what actually started me down this path. I had, in my opinion, a humorous exchange with a vendor about increasing quality of hire. “Who doesn’t want to increase quality of hire? Quality of hire is the key to an organizations success! We’ve improved every one of our clients quality of hire!”

Great, kudos to you. Now prove it. Seriously, prove it to me.

At this point one of two things occurs. Either there is dead silence or I’m faced with an onslaught of P-hacked data that means nothing.

This becomes the crux of the issue: how can a vendor prove something a company can’t even prove for themselves?

Very few companies take the time and/or have the discipline to truly measure, analyze, or understand quality of hire. Most organizations that have a quality of hire measure base it solely on tenure. Think about that for a minute. That should strike horror into you. That presupposes that results are less important than time in a role. If tenure is your only measure of quality, then the assumption is made that it is better to have a poor performer stay in their role longer than a great performer who stays for a lesser amount of time. Tenure only matters as a stand-alone measure of quality in the narrow confines of roles where there is no differentiation in results based on performance.

The next most cited measure is hiring manager satisfaction. Again, not a good measure, unless you have proven the causal relationship between hiring manager satisfaction and quantifiable performance differentiation (to keep it simple: it’s either the employee’s direct contribution to money made or money saved).

This gets us closer to the root of quality of hire measures, and our inability to get it right. It’s all about performance, and performance is about results (what and how). Quality of hire measures shouldn’t be about creating a stick for performance management, but about beginning the journey to predictive hiring analytics for your talent-acquisition team, as well as other areas of impact outside of talent acquisition.

To keep this from turning into a book, I will try to simply outline what is needed to even begin contemplating quality of hire:

Positions being measured against quality of hire must have clearly defined KPIs. These must relate to quantifiable measures of monies earned or monies saved; if not, you will find it nearly impossible, and most likely without value, to measure quality of hire.
Those measures have to be shared knowledge, not just existing in the hiring manager’s head, as they need to be fully understood in the recruiting process.
A structured interview process where technical skills and desired competencies are measured and quantified on an agreed-upon and universally applied scale.
Regular quantifiable performance measures and documentations that are objective and not subjective.
Highly trained and disciplined leaders that can quantify their employees performance in light of their specific impacts to revenue and/or savings.

Give yourself extra credit if you do this as well:

Calibration of performance and relative value for roles across the organization.

None of this takes into consideration that you will also need someone/something to record and tabulate all of the data, someone/something to analyze it, and someone/something to turn the analysis into practices that can capitalize on what is discovered.

Compound on this, the fact that based on the size of your sample, it could conceivably take years to see true trends and determine the necessary causality to drive action.

The good news it’s doable. The bad news it’s hard. I know this is the central topic for the upcoming ERE Conference in Atlanta, and I’m actually excited by that. Rob McIntosh is working tirelessly to help our profession have clearly defined terminology, so what I call quality of hire is the same as what you call quality of hire. Additionally, there is a great roster of speakers and attendees so that collectively we can explore, discuss, and challenge each other on to how best present quantifiable quality of hire and thus quantifiable value of talent acquisition to our employers.

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