Last year a software company hired Talent Acuity to evaluate two candidates – one internal and one external – for their open CFO position. The company was going through tremendous growth and change and within the last 18 months had had two individuals turn-over in the role. They could not afford to get this hire wrong.
The company had decided to use a recruiter who had recommended the external candidate as a “sure thing”. As part of our discussions, the company admitted some concern that my assessment 1) might contradict or undermine the recruiter’s evaluation process and subsequent recommendation, and 2) might lead the internal candidate (whom they did not think was appropriate for the role) to seek outside opportunities.
Before I get to how this story ends, let’s take a step back. Understandably, organizations are often hesitant to pay for an external perspective when hiring individuals for top jobs in the company. After all they are already paying talent acquisition staff and, in this example, a recruiter as well.
Yet the cost of an outside assessor’s perspective is quite modest compared to a poor hire, which can exceed $50k in terms of lost productivity, decreased morale, and lower sales. Indeed, the CEO of Zappos, Tony Hsieh, has stated that bad selection decisions have cost his company more than $100M. The resulting turnover creates a drag on company success: one SHRM study found that it can take more than 12 months to return to pre-turnover levels of performance. Turnover of very senior or specialized executives can exceed 200% of their salary for costs associated with recruiting, interviewing, training, and onboarding, as well as shareholder, stakeholder and customer re-engagement.
In terms of approach, external assessors leverage standardized assessments and other psychometrics that bring an additional level of rigor and consistency to the evaluation process. They are focused on exploring patterns of behavior and attitude in structured and objective ways that reveal consistent themes of strength and risk – as well as their implications for a candidate’s success in the role and company. Because the tools and methodology are unique, an assessor’s feedback and guidance often tend to complement the data collected by internal and external acquisition teams, and also inform subsequent onboarding and development, both of which are critical to getting new hires on the path to early engagement.
Now back to the lead-in: for both candidates I identified the positives and negatives as well as their implications relative to job requirements and company culture. Ultimately my recommendation was consistent with the recruiter’s while providing an additional level of confidence – and evidence – to the company that the external candidate was the right choice. Further, I met with both candidates after the selection decision to debrief and discuss the future. For the successful (external) candidate the plan was about onboarding: how to quickly get traction with key stakeholders, customers and team members; for the unsuccessful (internal) candidate, the plan focused on development: how to improve strategic thinking and influencing skills so as to be better prepared when a higher level role opens up in the future.
Both employees are doing well and still working for the same software company.
Ultimately you may decide that an external assessor is not right for a specific job opening in particular or for your company in general. My advice is this: use as many evaluation techniques as possible as a way to “triangulate” and therefore identify a candidate’s unique profile: real strengths and risks tend to consistently show up across disparate assessments. Resume screens and behavioral interviews should be supplemented with psychometrics and business cases. The difference between an effective and ineffective hiring decision may only be 1-2 additional assessments. Take full advantage of these tools to ensure that you understand everything you can about your potential new hire!