Hiring employees

Best Practices: Developing a World-Class Staffing System

Few areas have more immediate and lasting impact on organizations than recruiting and hiring employees. If you don't get the right people in the right jobs, you can't accomplish your organizational goals and objectives.

The key to hiring effectively, say Vistage expert speakers Lou Adler, Ed Ryan, Barry Shamis and Charles Sheppard, is to have a staffing system that provides a template, a model and a process for those who recruit, screen, interview and hire new employees. When properly designed and implemented, a staffing system takes much of the risk and uncertainty out of the process by providing a standard approach that ensures that everyone in the company hires in a consistent manner. Having a staffing system won't guarantee success every time. But it will dramatically increase your odds of getting the right person in the job with each new hire.

According to Shamis, building an effective staffing system consists of five essential steps:

Painting a picture of the successful person using hiring assessments and hiring tests
Developing a cadre of qualified candidates
Screening the candidates
Interviewing the candidates and checking references
Making the hiring decision

Because personnel selection affects the entire organization, the impetus to put a staffing system in place must come from the top. CEOs can't get involved in every hiring decision. And they may or may not want to get involved in the operational details of setting up a staffing system. But if the CEO wants to improve the quality of hires at all levels of the organization, he or she must make staffing a strategic priority and take full responsibility for the HR hiring tools system that makes those hires.

To make consistently great hires throughout the organization, our staffing services experts recommend the following best practices:

Build your staffing system upon performance-based criteria. According to Adler, most hiring decisions are riddled with emotion, opinion and personal bias. A staffing system built around performance-based criteria and standardized HR hiring tools allows you to eliminate personal bias, inject a healthy dose of objectivity into the process and make better hiring decisions.
Use a structured interview process. A structured interview process, including standardized assessment tools and hiring tests, removes subjectivity by forcing you to focus on past job performance. More important, it elicits information that allows you to compare candidates against the performance-based criteria rather than each other.
Develop a staffing plan. An effective staffing system includes a forward-looking staffing services plan that allows you to hire in a proactive manner and maximize the organization's resources. Shamis believes a staffing services plan should cover:

How many new employees will be needed during the coming year
Why those employees will be needed
When they will be needed
How much it will cost the company to hire them
What value they will bring to customers and the organization

Train your managers on how to use the system. In order to make consistently high-quality hiring decisions, all hiring managers must understand the process and use it in a consistent manner.

According to Ryan, a properly designed hiring system:

Significantly increases your odds of hiring the right people
Creates consistency in hiring decisions throughout the organization using standardized HR hiring tools
Supports management development
Helps improve benchmarking throughout the organization
Reduces the cost of the hiring process

"You can't make immediate wholesale changes in the quality of your people," he says, "but by implementing a staffing system, you establish behavioral benchmarks and standards for each position in your company. As people leave, you start hiring to those standards and gradually improve the level of talent. Over time, you will see a dramatic improvement in the quality of your talent pool."

The Performance-Based Job Profile

The absolute bedrock of every effective hiring system, say our staffing experts, is a performance-based job profile, an objective set of criteria that spells out the essential activities a person must accomplish and the outcomes he or she must deliver in order to get the job done.

"The job profile paints a picture of the ideal candidate and sets the standard by which all hiring employees decisions are made," says Adler. "It sets the tone for the entire process and dictates specific decisions and actions at each step of the process -- from the kind of candidate you seek to the wording of the employment ad to the questions asked during the interview to the final hiring decision."

To use job profiles to maximum effectiveness, say our speakers:

Use a performance-based job profile for every hiring decision. Great hiring decisions are always made on the ability to predict job success. The best way to predict future job success is to uncover examples of past performance using a performance-based job profile, including hiring assessments to assess skill level.
Build each job profile around objective, quantifiable, measurable criteria. The job profile spells out in specific, quantifiable, measurable terms what success looks like in a particular job. According to Adler, the ideal job profile fits on one page and includes:

The five to seven most important outcomes a person needs to deliver in order to get the job done.
The qualities and characteristics the person needs to get the job done, stated in specific terms of knowledge, skills and abilities.
Specific short- and long-term performance criteria that spell success in the job.

Benchmark job performance against both internal and external standards. Once you have begun to raise the quality of your talent pool based on internal benchmarks, start researching performance criteria from outside the company, using industry standards and other information to raise the bar for exceptional performance.
Regularly update job profiles as the organization grows and jobs evolve. Review and (if necessary) update job profiles at least once a year. Companies with very rapid growth curves may need to update every three to six months.

Shamis offers the following model to serve as a guide for creating job profiles within your organization:

Do the research. When researching a profile:

Use the job description. A good source of job descriptions can be found through staffing agencies.
Review past performance appraisals to see what works and what doesn't in the job.
Talk to "internal experts," anyone in the company who can shed some light on what it takes to succeed in the job.
Talk to external experts who have different insights and perspectives on the job. Contacting recruiters, staffing agencies, temporary staffing and industry experts are good sources to gain information about specific jobs.
Do a qualitative benchmark. Identify the best person that reports to you and make a list of what he or she does that causes you to think of him or her as the best. Do the same with the worst person who reports to you.

Define the expected outcomes. These are the things a person must accomplish in order to succeed on the job. To identify expected outcomes, ask:

At the end of six months, what must this person have delivered in order to be considered a great hire?
At the end of 18 months, what must this person have delivered in order to be considered a great hire?
At the end of three years, what must this person have delivered in order to be considered a great hire?

Determine the quantitative requirements needed to get the job done. Quantitative requirements represent the "what" of the job. They are measurable, easily observable and usually task-specific. Quantitative requirements include:

Knowledge: A familiarity with the information and processes necessary to skillfully accomplish the tasks of the job.
Skills: The ability to apply the knowledge to successfully accomplish the tasks of the job.
Ability: The person can handle the job situations in an appropriate manner.

Determine the qualitative requirements needed to get the job done. Qualitative requirements represent the "how" of the job. They are behavioral in nature and indicate how someone needs to go about getting the job done.

Recruiting

The next step in the hiring process -- and often the toughest in today's markets -- is finding enough qualified candidates. The real problem, says Ryan, is not a lack of qualified candidates. It's that most companies limit themselves by how they define and go after the labor market. Staffing services companies, staffing agencies and temporary staffing organizations can be good sources for finding qualified candidates.

"Don't make the mistake of thinking of your labor pool as only those people who don't have a job," he cautions. "Your labor pool actually consists of the entire population in your given area. Recruiting starts with getting the message out that your company is a great place to work and making it easy for the people in your community to reach you."

Our experts recommend the following recruiting best practices:

Develop a recruiting culture. Everyone -- from the CEO on down to the front line workers-- should keep an eye out for potential employees.
Establish an employee referral program. Set up a program whereby employees receive cash bonuses and other rewards for referring talented people.
Create compelling, opportunity-focused job ads. The right wording in an employment ad will go a long way toward improving response rates. According to Adler, the best job ads:

Focus on what the person needs to do, not what they need to have
Describe what the person will become and where they are going, not where they have been
Describe an opportunity
Avoid restrictions

Use multiple strategies to attract qualified job candidates. Today's tight labor markets demand a proactive, creative approach to recruiting. Our staffing experts recommend using a mix of the following strategies:

Employee referrals
Compelling, opportunity-oriented job ads
Headhunters/search firms/staffing agencies/temporary staffing/staffing services firms
Internet
Temps to perms
Interns
PR articles describing your company as a great place to work
Trade shows and conventions

Think out of the box. Recruiting-oriented companies constantly look for new and innovative ways to attract talented people including staffing agencies, temporary staffing and staffing services firms. Shamis suggests the following techniques:

Offer training sessions so people can learn a new skill. Use the sessions to evaluate attendees as potential job candidates.
Consider short-term consulting contracts at the senior level.
Look into outsourcing and job sharing.
Ask customers, suppliers and vendors for referrals.
Read the papers for news of layoffs, mergers and acquisitions and companies where the stock price is declining.

Never stop recruiting. Recruit seven days a week, 365 days a year. Never stop recruiting, even when you don't have any job openings.

Screening

An effective staffing system includes a pre-interview screening, hiring assessments and hiring tests process that minimizes your time investment by bringing in only the best candidates for face-to-face interviews. Our experts recommend the following screening best practices:

Learn to read résumés properly. Proper screening of résumés will allow you to narrow the pool of candidates to a manageable size with a minimum of time and effort.

Read the résumé in proper chronological order, starting with the first job and working your way forward to the most recent.
Look for increasing levels of responsibilities and accomplishments. In particular, look for achievements that closely correlate to the job at hand.
Use the résumés to screen in rather than screen out. The last thing you want to do is inadvertently weed out great candidates.
Never read more than six or seven résumés at one time.
Never make a hiring decision based on a résumé.

Use phone interviews to screen candidates. Never bring someone in for an interview without an initial phone screen. The 10 to 15 minutes you spend up front with candidates can save hours of time later.
Ask questions based upon the job profile. During the phone screen, ask one question related to each criterion on your job profile and listen for specific examples of past performance in that area.

Interviewing

After the hiring assessments, hiring tests and job profile, interviewing represents the most critical part of the hiring process. Staffing expert Charles Sheppard believes that every job interview should answer three questions:

Can the person do the job?
Will the person do the job?
Does the person fit the job and the company?

"The sole purpose of an employment interview is to predict success on the job," he says. "In order to do that, you have to be able to answer these three questions. Uncovering that kind of information requires structured interviews that focus on eliciting information about past job behavior specifically related to the job at hand."

Our experts recommend the following interviewing best practices:

Prepare for each and every interview. You can't "wing it" and expect to make good hiring decisions. Prior to each interview, review the following:

The résumé and job application
The notes from the phone interview
The job profile
Your list of prepared questions

Use a structured interview process for each candidate. A structured interview uses a prepared list of questions designed to surface information related to the job profile. This process will:

Keep you focused on gathering examples of past performance.
Keep the candidate from taking control of the interview
Remove subjectivity and personal bias
Provide an objective, consistent methodology for evaluating candidates

Focus on uncovering information about past performance. The more you can uncover examples of past performance that match the job profile, the more you can make objective hiring decisions.
Provide regular interview training for all hiring managers. To improve the quality of your company's hiring decisions, have your hiring managers update their interviewing skills at least once a year.
Ask only behavior-based questions. During the interview, avoid opinion-, credential- or experience-based questions. Instead, ask behavior-based questions that uncover an applicant's specific work-related experiences and allow you to assess job performance.
Check all references. Reference checks are necessary to:

Verify information collected from the résumé and during the interview
Uncover additional information that might influence your decision about the candidate
Provide legal protection

To get the most from your reference checking, say our experts:

Ask candidates for the names of people who can speak to the quantity and quality of their work experience.
Have candidates call their references so they will expect your call.
Avoid asking questions that call for opinion or judgment.
Stick to specific questions related to the candidate's work.

To improve your interviewing skills, say our experts:

Keep in mind that the sole purpose of the job interview is to predict future job success by uncovering examples of past performance.
Understand that interviewing behavior (how the candidate acts during the interview) is not a good predictor of job performance.
Focus on gathering enough information to make a quality decision about whether the applicant will be successful on the job.
Never interpret a question for the candidate. If necessary, repeat the question, but don't add to it in any way.
Don't ask about values, chemistry, etc. If you can't define or measure it, don't interview for it.
Avoid snap decisions. Ask all the questions even if you don't immediately like the candidate.
Use multiple interviews to get a bigger picture of candidates.

Use standardized hiring assessments and hiring tests system to supplement the interview process.

Making the Decision

With an effective staffing system, the decision for hiring employees becomes the easiest part of the hiring process. When you establish job-related criteria, ask behavioral questions that focus on past job performance, interview all candidates in the same way and evaluate them against your standard as verified in hiring assessments and hiring tools, the hiring decision almost makes itself.

To make the best hiring decisions, our experts recommend the following best practices:

Evaluate the candidates against the job profile, not against each other. If none of the candidates meets the job criteria, don't hire any of them. Instead, step back and reevaluate your job profile to make sure it is realistic. If it is, go back to the recruiting process and start over again.

When evaluating candidates, Sheppard recommends rating behavioral examples based on the following criteria:

Is it an incident of effective behavior?
Is the example recent?
Did the candidate give detail?
Does the candidate exhibit the behavior much of the time?
Did the candidate give a reference?

Score one point for each "yes" answer, so that each behavioral example will have a score from one to five. Add up all the behavioral examples to get a candidate's total score.

Use a "scorecard" for each candidate. To properly evaluate candidates against your performance criteria, use an objective scorecard that allows you to rate candidates in the key areas on your job profile and hiring tests. Ratings can be numerical, plus or minus (plus if candidates exhibit the performance, minus if they don't) or by degree (i.e., candidate strongly exhibits this behavior, candidate moderately exhibits this behavior, candidate does not exhibit this behavior). Whichever method you choose, the key is to use a quantifiable, measurable scoring system (e.g., standardized hiring assessments and hiring tests) and evaluate candidates against your standard, not against each other.

Contributing Experts:

These experts were selected from Vistage's stellar corps of speakers. Vistage Speakers regularly share their expertise with individual Vistage groups in highly-interactive half-day sessions.

Lou Adler
Lou Adler is founder and president of CJA Associates Inc., an executive search and organizational consulting firm headquartered in Southern California. He created the POWER Staffing _ hiring and software system and has developed two major hiring training programs. He has written a book, "Hire With Your Head: A Rational Way to Make a Gut Decision" (John Wiley & Sons, 1998) and has been featured in the Los Angeles Times, Boardroom Reports and HR Magazine. He also has produced an audiotape series with Nightingale-Conant called "POWER Hiring - How to Hire Great People Every Time." A Vistage expert speaker since 1991, Adler has addressed more than 150 TEC groups on the ins and outs of developing effective staffing systems. His two new Vistage programs include "Winning the Talent Wars" and "Taming the E-Recruiting Jungle."

Ed Ryan
One of the most tenured and sought-after Vistage expert resource speakers, Ed Ryan is founder and president of Marketing Personnel Research (MPR), Inc., a worldwide consulting firm specializing in productivity improvement. His company studies the behavior of achievers, constructs benchmarks and profiles and devises questions and observation tools to help hiring managers compare job applicants to the behavior of high performers. His company's behavioral profiles can also be used to assess and manage current personnel. A Vistage expert resource speaker since 1985, Ryan has given more than 500 Vistage presentations on subjects relating to hiring, promotion, interviewing and personnel selection.

Barry Shamis
Barry Shamis is president and CEO of the international management consulting firm, Selecting Winners, Inc. He is also the founder and managing director of the Institute for Executive Selection. Both of his organizations are dedicated to teaching companies how to make better hiring decisions. An entrepreneur, national speaker and trainer, Shamis has authored two books, written a number of articles, developed a computer-based training program on the subject of choosing people, and has spoken to hundreds of executive audiences around the world. His latest book, "Smartass Answers to Stupid Interview Questions" offers a light-hearted look at the crazy things people do during job interviews. As a Vistage expert resource speaker, he has addressed more than 100 groups on the subjects of "Selecting Winners" and "Recruiting and Retention: A Model for CEOs.".

Charles Sheppard
Charles Sheppard is president and CEO of Management Communication Systems Inc., a company on the forefront of next-generation behavioral assessment technologies. Using innovative technologies and creative solutions, his firm helps organizations select talented people, create high-performing teams and enhance organizational development. With a background in corporate sales, management and start-up ventures, Sheppard developed the S.A.R.G.E. behavior-based interviewing model used by Vistage to assess and interview Vistage Group Chairs, and has trained more than 4,000 recruiters for M.R.I., the nation's largest recruiting company, in behavior-based interviewing. Sheppard regularly addresses Vistage groups on the subject of "Creating A High Performance Culture."