Google’s Secret of Hiring the Best People
“Development can help great people be even better— but if I had a dollar to spend, I’d spend 70 cents getting the right person in the door.” —Paul Russell, Director, Leadership & Development, Google
Have you ever struggled with “getting the right people on the bus, wrong people off the bus, and the right people in the right seats?” If the answer is the affirmative, you are not alone. In fact, The Economist reported that finding the right people is singlehandedly the largest problem in business today.
In Geoff Smart and Randy Street’s remarkable book, Who: The A Method for Hiring they provide simple, effective, and systematic approach to hiring A players. So many people base their hiring judgments exclusively on gut instinct but few would acknowledge this. That is exactly why, Smart and Street conducted the largest study ever including more than 20 billionaires, 30 CEOs of multi-billion dollar companies, and 300 CEOs and investors of profit and non-profit organizations.
As research suggests, the bottom line is that the hiring failure rate is close to 50% with the cost of hiring mistakes adding up to 15 times an annual employee’s compensation. Some of these are hard costs such as recruitment and training, but a lot of them are soft costs, including damaged relationships, disruption to the culture and team dynamics.
Here are four steps that will help you improve your hiring success rate from 50% to 90%. Smart and Street calls this the “A Method for Hiring.”
1. SCORECARD: KNOW WHAT SUCCESS LOOKS LIKE
Before you even consider hiring anyone, the number one thing you need to do is understand and scope out what the job position for the A player “looks like.” By this, I am not talking about creating a typical job description. The scorecard specifically outlines what success looks like for someone in this role. The scorecard consists of three components:
- Mission: Clearly articulate the purpose of the position and how it directly relates with the business need. For instance: “Drive the mobile industry back to the #1 market share within the next year through innovative product launches and strategic alliances.”
- Business Outcomes: In order to achieve the mission, outlines five to seven expected, measurable business results. For instance: “Grow revenue from $1 Billion to $2.5 Billion in the next two years through capturing market share and new product launches. The better the business outcomes are clarified, the higher chance employees will understand their goals. Outcomes need to be SMART: Specific, Measurable, Achievable, Realistic, and Timely
- Competencies: Outline specific and general competencies that will deliver the business outcomes while upholding the company values and corporate culture. For instance, common competencies include leadership, integrity, strategic mindset, interpersonal skills, and technical excellence. While the first two elements are designed specifically for the position, competencies will generally will apply across many roles with targeted adjustments.
2. SOURCE: FINDING THE CREAM OF THE CROP
The authors note that the best way to find a pool of applicants is through referrals. In fact, the success rate of leveraging the best candidate’s network is much more effective than print ads, job boards and utilizing expensive recruiters. Smart and Street recommends “paying a much bigger referral bounty to your employees who source A Players who are hired. One high performing company, for example, pays its employees a $100,000 hiring bounty for people who are hired (paid out $10k per year for 10 years of start date if both the referring party and the referred party are still employed).”
3. SELECT: RELYING ON DATA INSTEAD OF GUT INSTINCTS
Select right people based on analytical, objective information rather than purely relying on your gut feelings. Conduct at least one extremely thorough, 3-hour, chronological interview to really dig in and what the person has accomplished.
- Past Performance: Instead of asking situational questions, use behavioral questions. Studies in psychology and marketing research suggests that people are very poor predictors of their own behavior, especially when are intentionally “selling” themselves to a potential employer. Rather, focus on the behaviors and performance in the past, a much more reliable indicator
- Open-ended questions: The best interview questions are questions that start with: what, who, why, where, when, how:
– What was the person hired to do?
– What were his or her biggest accomplishments?
– What were his or her mistakes?
– What would his or her bosses say about them (which can be verified with reference checks)
– Why did he or she leave?
- Weaknesses: Spend equal time in an interview understanding a candidate’s mistakes /weaknesses as you do understanding their strengths. Watch out for red flags like: candidates who don’t take responsibility for past mistakes, or who speak poorly of most of their bosses. For more reference, see Marshall Goldsmith’s 20 behavioral derailers that he writes about in What Got You Here Won’t Get You There.
4. SELL: SELL LIKE A ZIG ZIGLAR
Selling must happen prior to the job offer. It must be throughout the recruiting and selection process. To capture the hearts and minds of A players, the authors suggest that proper compensation is important, but not a deal-break. In fact, the authors suggest the 5F’s. These F’s need to be communicated to A players to provide a compelling value proposition for working for the company.
- Fit (with your company)
- Family (support for joining your company)
- Freedom (to make decisions)
- Fortune (and glory)
Check out the YouTube clip below where Google’s VP of HR below talk about how Google hires top talent: