Zero-Based Hiring: How to Make Hiring a Business Process

If you’re not consistently seeing or hiring enough top people, it might be time to evaluate everything you’re now doing from a different perspective. The concept of zero-based budgeting offers a useful approach. The essence of zero-based budgeting is that you can better determine true departmental expenses by justifying every cost item. The alternative is to justify only the incremental increases, assuming what’s now in place is okay. The benefit of zero-based budgeting is that unnecessary processes and bureaucracies are eliminated before they get embedded into a company’s culture. Zero-based hiring is based on a similar concept. Don’t assume that the hiring methods you’re now using should automatically be continued. Many built-in process are either unnecessary, ineffective or counter-productive. You should consider zero-based hiring if you answer yes to any of the following three questions:

  1. Are your sourcing techniques not generating enough top candidates?
  2. Do you often hire candidates who are competent but unmotivated?
  3. Do you regularly hire candidates who talk a good game but don’t deliver the results?

While we’ll discuss the details of zero-based hiring in future articles, here are some of the highlights:

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  1. Hire the best employees, not the best candidates. In a recent article, I attempted to make the case that the best employees are not necessarily the best candidates. The best employees take longer to decide, they won’t waste their time, they don’t spend too much time looking, and among other things they look at a new job as a step in a career, not a destination. Top candidates however, tend to always look, they have polished resumes, they will take the time to apply, they’re always well-prepared, and among other things they make a good first presentation. How you source, assess and hire the best employees is fundamentally different than how you source, assess and hire the best candidates. It seems that most companies have designed their hiring processes around the needs of best candidates. This is one reason they’re not seeing enough top employees.
  2. Make the job description equal the real job. If you’re using traditional skills-based job descriptions to hire people, stop. This is the single most important thing you can do to hire top employees. Define the deliverables and some of the key sub-steps required for on-the-job success. This is a far better way to understand the real job than the typical job description listing skills and experiences. At best, this is a person description, not a job description. At worst, it excludes the best employees from even applying. The best employees don’t want the same job, they want a better job. You’ll be able to separate the best candidates from the best employees during the interview. First, tell your candidate what’s expected on the job. Then ask them what they’ve accomplished that’s most comparable. Dig deep (10-15 minutes on three or four accomplishments is about right), and you’ll quickly know which group you’re dealing with.
  3. Measure first impressions at the end of the interview. First impressions don’t predict job success, even for sales positions. Great comparable past performance does predict job success, even for sales positions. There are many people who make good first impressions who aren’t very good. And there are some very good people who don’t make a good first impression. Don’t compromise on the candidate’s ability and motivation to do the work (see my article Ask, Don’t Tell” if you want to know how to do this accurately). At the end of the interview, objectively assess the candidate’s first impression and it’s impact on you. You’ll discover that about 50% of the people you thought were great aren’t. You’ll also find that many people who you thought were weak are really good ó some even great. Along the way, you’ll also learn a lot about yourself and your biases, and that’s the real point of this item.
  4. Increase your market share of top employees, not top candidates. First fire your recruitment advertising agency if your ads aren’t pulling in enough top employees. Don’t listen to their excuses. You can hire top people through advertising if you recognize that sourcing is targeted marketing, not broad-based advertising. To increase your market share of the best employees, you need hard-hitting themes which capture their attention and which cater to their dominant needs. That’s what treating candidates as customers means. Most recruitment advertising targets the best candidates, not the best employees. Unfortunately, most recruitment advertising agencies who write these ads don’t even know the difference.
  5. You don’t need to hire passive candidates. Instead, make some of the less expensive sourcing channels more effective. Everyone thinks targeting passive candidates is the panacea. It’s not. Passive candidate sourcing takes too much time and it requires the continuous involvement of very strong recruiters. There are many other things you can and should do first, before you go after passive candidates. For example, more compelling and highly visible advertising will pull in semi-active candidates. These are those top performers who only look sparingly. If you design your hiring processes to find and process these candidates, you’ll quickly improve the quality of your candidate pool. Another idea: use proactive employee referrals. Instead of waiting for employees to make recommendations, force their hands. Ask them who the best people are they know from prior companies. Only do this with your best employees, since they are much better at identifying talent. Then have your best recruiters call and network with these pre-qualified top people. You should optimize every sourcing channel like this before going after passive candidates.
  6. If you’re using traditional behavioral interviewing, stop. If you’re not, start. Traditional behavioral event interviewing is not all it’s cracked up to be, but it’s far better than a typical unstructured interview. On the negative side, the best candidates all practice using the typical behavioral questions, so it’s not as reliable as it could be. Additionally, it’s not very useful at assessing the competency/motivation combination, essential for predicting on-the-job success. I recommend a modified version of behavioral interviewing called performance interviewing. This interview relies on just two performance-oriented questions. The key is to develop comprehensive details about a candidate’s most significant accomplishments in comparison to the deliverables described in the job profile (see point 2 above). The interviewer then needs to look at the trend of these accomplishments over time to determine competency, motivation and potential.
  7. Undersell and overbuy. When you finally meet a hot candidate, there is a natural tendency to stop listening and immediately attempt to “sell” the candidate. Not good. For one thing, the hot candidate might not be a hot employee, so this technique will backfire since you’ll never learn any more about the candidate. If the person really is hot, then you’ve demeaned the job and lost your negotiating power to boot. Overselling and under-listening are the first steps in making bad hiring decisions. A better way is to make the candidate earn the job by conducting an in-depth interview (see points 2 and 6 above). Describe the challenges in the job, and make the candidate prove to you that he or she can achieve them by getting detailed examples of what they’ve done that’s most similar. When an interview is conducted this way, the best employees will actually attempt to sell you if the job offers growth and opportunity. This is the way you recruit a top person. You can’t tell the person the job is great: they’ve got to figure that out for themselves. All you can do is guide them along. This is what great recruiting and interviewing is really all about.
  8. Reduce your sendouts/hire by 50%. Three sendouts per hire is a reasonable goal for unique positions, two if you’re hiring in high volume. This is the best metric of them all, since it’s a clue to the effectiveness of your entire hiring processes. To improve it, don’t worry too much about where you are now. First, figure out what it would take to reduce sendouts per hire by 50%. Put all the big changes needed in priority order, and then start working on the list (this is called a Pareto analysis, and it’s a rough approximation of what Six Sigma black belts do). Plan on completing the list in six months. If you don’t have the resources to do this, don’t compromise on the six months: get the resources. This is the kind of things the best employees do, and someday you’ll be able to explain how you accomplished this to some interviewer who is using zero-based hiring. (I put this last point in so you’d get a sense of the how the performance-event interviewing technique I’m recommending works in practice with you as the candidate. The best employees like to discuss their biggest accomplishments in-depth.)

Make hiring the best a repeatable business process. Incremental improvements won’t work. If you’re not hiring enough top people, it’s time to implement zero-based hiring. Stop making excuses and figuring out why it won’t work. Be part of the solution, not part of the problem. If you want to make an impact, be like the best employees you want to hire. They tell you how they made things work. They get the resources, they break the rules, they fight bureaucracy, they change the culture, they take risks, they overcome challenges, and they exceed expectations. Isn’t it time you started hiring the best employees? In six months you could be famous.

Lou Adler is the CEO and founder of The Adler Group – a training and search firm helping companies implement Performance-based Hiring℠. Adler is the author of the Amazon top-10 best-seller, Hire With Your Head (John Wiley & Sons, 3rd Edition, 2007). His most recent book has just been published, The Essential Guide for Hiring & Getting Hired (Workbench, 2013). He is also the author of the award-winning Nightingale-Conant audio program, Talent Rules! Using Performance-based Hiring to Build Great Teams (2007).