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harvey WigderThe Wigder Report

Management Ideas For Privately Held Companies

The goal of The Wigder Report is to provide challenging ideas that will be useful for privately held and family businesses.

Gut Hiring Works!--with the right foundation

by Harvey Wigder

Max was perplexed. His company desperately needed a head of Manufacturing Operations for a critical Division and he thought he had solved the problem.

About a month earlier, an employee suggested he meet Jack, an executive who had been successful in essentially the same job in a larger competitor. Max liked Jack and thought that he was the right person for the job and could also solve a larger problem. Max was the acting head of the Division as well as President of the whole company and was juggling too many balls. Max saw Jack as a person who could move up to run the Division.

When Max introduced Jack to the other key people in the Division, they were unanimous in concluding that Jack didn’t have the right skill set or personality for the job. Jack also had concerns: he was interested in the job because he saw a chance to run a Division, not to repeat the same job with another company.

Max asked me to interview Jack and check references. I evaluated Jack as a smart and skilled executive. His references confirmed that Jack had done a strong job in each instance. Yet, these same past supervisors had hesitations about his ability to move up to General Manager.

It was easy to conclude that the company needed to consider other candidates. It was also clear that a faulty hiring process was a big cause of the impasse.

Max’s instincts weren’t all wrong. His “gut” was right in that Jack was a quality person. However his process lacked a thorough consideration of the job-criteria noted by other executives in the company: needed skill sets, personality, composition of the total team, and the motivation of the candidate to do the required job.

Max retained me to find candidates for the job, and didn’t have much interest in the actual hiring process. He simply wanted someone to do the job, preferably yesterday!

The chart below shows things that can go right or wrong in a hiring process.. The first column gives the steps that occur, the second column what can go wrong (and did in this case) and the third, the result of a well-managed hiring process.

  Unmanaged Project/ Ad hoc process Managed Project
Strategy: define the job, hiring specifications and methods for finding candidates. False starts because job isn't carefully defined and disagreements surface about needed qualifications.Mediocre hires because bar not raised high at outset of process. Carefully define the job, recruiting target, expected compensation, recruiting methods and marketing strategy at the start.Set and hold high standards throughout the process.
Finding candidates and managing candidate development process. Candidates are interviewed as they surface. A plan is followed to manage the funnel (from dozens or hundreds of applicants to proposed candidates) so that it results in timeliness and quality.Candidates are screened and evaluated before management is asked to interview. The recruiter expects to take responsibility for the quality of candidates and for only presenting thoroughly evaluated candidates to management.
Interview Scheduling Staff asked to interview at the last minute with no context or briefing on candidates.Interviews are conducted without focus. Interviews are scheduled in advance.Throughout the process, the candidate knows what to expect in terms of whom he will meet, how to prepare and timing of the process.Before interviews start, interviewers understand the process (i.e., how their input will be collected); have position descriptions, resumes and other evaluative materials (recruiter's summary, test results, references) and have been briefed on any open issues of concern about the candidate.Interviewers are made responsible for focusing on specific aspects of candidate's credentials to ensure thorough evaluation.
Quality Interviews Interviewers aren't prepared and interviews are often of poor quality.Company doesn't put best foot forward. Interviewers have training on how to conduct interviews and areas to cover in conversations with candidates.Interviewers sell the company.Candidates see professionalism of process.
Orderly Negotiations Too many surprises. Expectations are managed so that issues about compensation and also, organization, responsibilities, and level of challenge are resolved throughout the process so that no one is surprised as the process concludes.Intermediary handles negotiations and assures fair deal.

My job was to manage a project that would result in quality hire for the company. To ensure this happened, I involved the entire management team in defining the job and in selection. Behind the scenes, I was thorough in finding and evaluating candidates. The result was success. There was unanimity on criteria for selection, a feeling that the right people were presented to the management team for their consideration, and total agreement on the person selected.

Max and his team benefited from a rational and systematic process that resulted in their having the chance to chose among carefully selected candidates. Freed from other concerns, they were free to use their gut and instincts. They did and selected someone they were excited about working with.

Like Max, most business owners are more focused on the result than the process. However, they would help themselves if they understand the benefits and insisted on good hiring processes in their companies. Smaller companies without a full time HR function and a skilled recruiting manager don’t have to give this up because they lack time or expertise. They can outsource project management like this company did.

Haphazard hiring process leads to bad hires. The expense of hiring can be increased and the odds of hiring incorrectly are made worse. An investment in good hiring helps reduce hiring failures and contributes to the building of stronger companies.

Permission to reprint this article is granted, provided you let me know where it is being printed, the copyright is not removed, and the following text accompanies each article:

Harvey Wigder is the principal of Fulcrum Resource Group. He works with the owners of private companies to develop and implement recruiting, compensation and retention strategies. Contact him at 617-964-1855 with you comments and suggestions on small business management issues.

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