On April 25, the U.S. Equal Employment Opportunity Commission issued an updated Enforcement Guidance on employer use of arrest and conviction records in employment decisions under Title VII of the Civil Rights Act of 1964, as amended. The Guidance summarizes the EEOC’s long-held position that employers’ reliance on arrest and conviction records may have a disparate impact on individuals because of their race or national origin. Although not legally binding, the Guidance provides key insight into how the EEOC views the use of criminal records when screening applicants.

The Guidance is part of the EEOC’s broader effort to crack down on the alleged misuse of arrest and conviction records. The EEOC’s increased efforts in this area are due, in part, to the growing disparity in arrest and incarceration rates for Hispanics and African Americans compared to Caucasians. The Guidance notes that African Americans and Hispanics are arrested at a rate that is two to three times their proportion of the general population. Incarceration rates for male Hispanics (17.2%) and African Americans (32.2%) are also much higher than for Caucasian men (5.9%). The EEOC relies on these disparities in concluding national data “supports a finding that criminal record exclusions have a disparate impact based on race and national origin.”

The Guidance differentiates arrests from convictions, noting that because arrests are not proof of criminal conduct they cannot serve as a proper basis for excluding an individual from employment. The EEOC acknowledges, however, that while an arrest record standing alone may not be used to deny an employment opportunity, an employer may make an employment decision based on the conduct underlying the arrest if the conduct makes the individual unfit for the particular job position.

The bulk of the Guidance focuses on how reliance on conviction records potentially can give rise to disparate-treatment and disparate-impact claims. A disparate-treatment claim arises when an employer treats criminal history differently for different employees based on their race or national origin. A disparate-impact claim arises when an employer’s neutral background-check policy disproportionately impacts a protected class.

If an employer’s background-check policy results in disparate impact, the employer bears the burden of proving its policy is job-related and consistent with business necessity. The Guidance stresses that to establish the “job-related and consistent with business necessity defense,” an employer must use a targeted screen process that considers: (1) the nature and gravity of the offense; (2) the time that has passed since the offense; and (3) the nature of the job held or sought.

The EEOC explains that for individuals screened out by this process, the employer’s policy should provide an opportunity for an individualized assessment, wherein the employee or applicant is given an opportunity to demonstrate that the exclusion should not be applied due to his particular circumstances. The Guidance provides several factors for consideration during the individualized assessment, such as the number of offenses, age at time of conviction, length, and consistency of employment history before and after the offense, rehabilitation efforts, and character references.

Perhaps most significant are the Guidance’s “employer best practices,” which include the EEOC’s recommendation that employers not ask about convictions on job applications. Instead, the EEOC recommends that if and when employers make such inquiries, the inquiries be limited to convictions for which exclusion would be job-related for the position in question and consistent with business necessity.

In light of the new Guidance, this is an opportune time for employers to reexamine their background-check policies and practices. Although courts are required to defer to EEOC guidance like this to some extent, only time and, unfortunately, lawsuits are likely to determine whether courts determine the EEOC’s new Guidance is correct.

HR professionals have designed, built, torn down, and rebuilt many things to enhance talent acquisition: processes, procedures, metrics, sourcing channels, more metrics, and even more sourcing channels.

Looking back over our careers, we can see that great things have been created across the recruiting landscape. On Earth Day, however, we are thinking about how we can reduce, reuse, and recycle to contribute to a healthier “candidate planet.” With all the “stuff’ which has been created, we believe we need to replenish and restore our overall candidate experience. Here are a few of the ideas we’re pursuing now:

1. Reduce waste: how many of us have long, complex hiring processes? We may not think so, but our candidates might feel otherwise. Applying LEAN principles to transaction-based recruitment processes will help identify areas for improvement, and we should also think about our ability to reduce the time commitment we require of candidates. Deploying video-interviewing (versus travel) or offering virtual career days, events, or forums that align with candidate time constraints and geographies are just a few ways to do this.
2. Recycle talent: what happens to the silver and bronze candidates? What about the talent you wanted to “keep in mind” for the future — where are they? Reconnect with your targeted talent, review their professional situations, and re-engage. For recruiters who support multi-business-unit organizations, have you considered talent-sharing programs, whereby talent is “recycled” for opportunities outside of one business unit, for an opportunity within another?
3. Replenish talent pools: Hiring is starting to ramp upfor certain organizations. Candidates, however, are not widgets; they don’t simply get produced en masse and on demand. Talent takes time to engage; candidates want to get to know an organization, learn more, and determine their own fit. Thinking ahead of the requisition, are we able to engage deeper with our businesses and our HR colleagues to better forecast our talent needs.
4. Restore your candidate experience. Many of us “think” we have superior candidate experiences, but do not be surprised by the gap between what we believe, and what our talent actually experiences (see our recent ERE article). Take a moment to walk in the shoes of a candidate and answer these questions:

• How easy is your applicant tracking tool?
• What about hiring manager interviews, or screening calls? Are they easy to dial into?
• How visible are your opportunities to your target audience?
• What do your new hires think about their experiences after six months or a year on the job?
• What about the talent you rejected?  What did they retain from their candidate experience?

As talent acquisition specialists, we believe we have a responsibility to help preserve and grow our “candidate planet” in a sustainable way. To do this, we must be more consistent with the way we care for our candidates, as well as how we work with and for our talent. This requires the commitment of our business leaders, and the only way we can get this is by demonstrating the importance of the candidate planet to our organization.

A few weeks ago on these pages, I suggested that the ERE Expo wasn’t as progressive as it could be in bringing the most important trends to its recruiting audience. My concern was lack of focus on these areas:

1. Limited (if any) discussion on the development of talent strategies, when the supply of top people is less than the demand. Everyone seemed more enamored with learning about ways to weed out the weak rather than attract, recruit, and hire the best.
2. Too much on sourcing and not enough about recruiting and closing.
3. Little on how to engage hiring managers fully in the process. This is odd since they make the decision on who to look for and who to hire.
4. No emphasis on the unspoken 83% of the labor market who will not respond to your posting or apply online, regardless of how cool your Facebook page is. Of course, these are the passive candidates.

So in my own small way, I’ll use this opportunity to address the last three points above, by introducing “The Golden Rule of Passive Candidate Recruiting.” Using a high-tech, high-touch approach I believe it is now possible for a talented recruiter to build a slate 3-4 of top-notch passive candidates in as little as 72 hours from taking the assignment. As you’ll see, to pull it off, it requires the active engagement of hiring managers combined with reasonable sourcing skills, in combination with great recruiting, counseling, and closing skills.

Implementing the Golden Rule of Passive Candidate Recruiting

There are about 20 things involved in the process of meeting the 72-hour target. Following are the most important.

1. Don’t use job descriptions. During the intake meeting with the hiring manager, define success as a series of 5-6 critical performance objectives. Then ask managers if they’d meet someone who had achieved comparable objectives, but doesn’t meet all of the experience requirements listed on the job description. This is a critical step, and you’ll never make the 72 hour goal if you use job descriptions. The trade-off: you won’t compromise on performance or potential, just on absolute skills and experience. (Here’s a more detailed article on how to prepare these performance-based job descriptions.)
2. Find the “ideal candidate.” During the intake meeting find someone on LinkedIn who is a high achiever or identify a fast-tracker inside your company. Fast-trackers always have less experience than their peers, so this is important. Then ask the manager if he/she would be open to meeting someone like this who is clearly a high performer, but with less experience listed on the job description.
3. Use LinkedIn Recruiter to clone the “ideal candidate.” LinkedIn offers two easy ways to develop a prospect list of 20 or so people in less than 30 minutes. One is the “similar profiles” button to the right of the person’s name, and the other is on the right-hand side, titled “Viewers of this profile also viewed …” In less than one hour after the intake meeting you should be able to identify 15-20 possible prospects.
4. Prepare creative and career-oriented job branded messages. Messages including voicemails, emails, and postings. The key to all of these is to lead with the employee value proposition and highlight the 2-3 big performance objectives. Tie these to the company strategy and vision. This is job branding and will attract a stronger group of candidates. Even passive candidates will check out the posting after initial contact, so this is important. Here’s an example of a this type of career-oriented posting.
5. Ask the “yes” question to establish applicant control. Ask prospects if they’d be open to discussing a possible career move. Then, don’t describe the job; instead, ask them questions about their LinkedIn profile. Getting candidates to talk first is part of applicant control and essential for meeting the 72-hour goal.
6. Convert your job into a career move. During the initial screen, look for gaps between the performance objectives of the job and the person’s experiences. Use these gaps to establish your opening as one worthy of continued discussion. For example, if your job offers a faster growth rate, more visibility, and some stretch, you’ll be able to use this as reasons for the candidate to move forward in the process.
7. Connect, re-search, and Cherry Pick. Make sure you connect with everyone on LinkedIn during the preliminary call. If the person is not appropriate for your job, you’ll then be able to search their connections. Call the person back and ask about specific people who might be better suited for your opening.
8. Follow the 80/20 networking rule. If a person is not appropriate for your opening, you must get 2-3 warm referrals via Cherry Picking. This is the critical to meeting the 72-hour objective. Warm referrals call you back, and since they’re already pre-qualified, you’ll find strong prospects quickly. Here’s more on how to Cherry Pick and network on LinkedIn.
9. Search on achiever terms. One way to find great prospects quickly is to search on things your ideal candidate has done that would indicate the person is in the top-half of the top-half — e.g., B+ or better talent. This would include terms like award, patent, whitepaper, fellowship, scholarship, work-study, honor, and the specific names of honorary societies, leadership titles, and awards, among others.
10. Find nodes. Find people who have worked with your ideal candidate, like project managers, customers, vendors, and professional associates. For example, partners in CPA firms know high-achieving accountants who have left their firms, and Agile Scrum managers know great Ruby developers. Connecting with nodes allows you to quickly Cherry Pick their connections as a means to quickly get your 2-3 high quality referrals per call target.
11. PERP your ERP to create a Virtual Talent Community (VTC). Proactively get your employees to connect with their best former co-workers. Then when you search and Cherry Pick their connections you’ll have more than enough great people within hours after taking the assignment. These top-notch first- and second-degree connections represent a VTC and are far more valuable than a pool of random followers or a stack of resumes.
12. Be SWK and an SME. Passive prospects will always check out your profile before calling you back. So make sure it’s clear you’re Someone Worth Knowing and a Subject Matter Expert. This is how you leverage your online identify and get even more referrals.

Since everyone will soon have instant access to the same people, active candidate recruiting will become even more problematic with quality of hiring becoming even more random. Since 83% of the fully-employed members on LinkedIn classify themselves as passive, this is where the future action will be, and recruiters who can implement the Golden Rule of Passive Candidate Recruiting will be in high demand. Expect the 72-hour Golden Rule to become the new normal, and those recruiters who can implement it become the new rock stars.

Recent research confirms that top performers ranging from managers of major league baseball teams to customer service reps on the store floor have one thing in common: they are Deciders. And there are plenty of them out there just waiting to be recruited.

In the last decade, renowned industrial psychologist Timothy Judge at the University of Notre Dame’s Mendoza School of Business has discovered a set of four characteristics that are found in high performers in virtually every industry, every job level, and every variety of circumstance from boom to bust. Together these four characteristics make up a sort of super trait called a “core self-evaluation.” As Judge describes it, the core self-evaluation is a person’s fundamental bottom line evaluation of their abilities. That self-evaluation has an enormous impact on their job performance.

The Decider Advantage

In one fascinating study, Judge and his team tracked the progress of more than 12,000 people from their teenage years to middle age. He found that core self-evaluations predicted who did and who didn’t capitalize on the advantages life dealt them. With only a bleak view of their capacity to handle life’s challenges and opportunities, even the brightest kids born to executives and doctors failed to reach as high an annual income as their less fortunate classmates.

By contrast, the supremely confident sons and daughters of roofers and plumbers who had only mediocre SAT scores and below average grades earned a 30%-60% higher income than the smart kids with dreary views of their abilities. And those kids with all the advantages of intelligence and pedigree plus a firm belief in their competence earned three times as much money as their equally blessed peers.

I refer to people with a high core self-evaluation as “Deciders.” Deciders have such a firmly rooted belief in their ability to shape the events more than events shape them, that they aren’t afraid to make decisions. That simple willingness to make a call gives them a tremendous advantage that snowballs throughout their life. As the 13^th century Turkish sage Nasreddin said “Good decisions come from experience. Experience comes from bad decisions.” People who simply make more decisions — both good and bad — develop good judgment faster.

For example, let’s say you’re interviewing Matt and Jen for a job. Both Matt and Jen have seven years of experience in their field, but Jen is a Decider and Matt is a Drifter. Matt’s MO is to drift through each day deferring decisions to his bosses and his colleagues. Jen, on the other hand, makes decisions all day, every day. Even if they began their careers with equal abilities, seven years later Jen’s judgment will be far sharper than Matt’s simply because she has made more decisions. That’s why Timothy Judge’s colleagues have found that Deciders sell more than other employees. They give better customer service. They adjust better to foreign assignments. They are more motivated. They experience less stress. They like their jobs a heck of a lot more.

Spotting the Next Superstars

Unfortunately, judgment is a squishy concept that you won’t find on a resume. But spotting Deciders is much easier. Judge’s simple 12-question “Core Self-Evaluations Scale” is free on his website. In the meantime, here’s what to look for during the recruitment process:

• Self-efficacy: People who believe they can overcome challenges are more successful in virtually every sphere of life including work.
• Internal locus of control: Does this employee take control of his work, or does he always point to outside circumstances when his projects go astray?
• Confidence, not narcissism: There is an important difference between having a high self-evaluation and being a narcissist. Does the employee pitch in when teammates need help, or badmouth co-workers they view as a threat? Are they receptive or defensive when you receive feedback?
• Emotional stability: Employees who aren’t easily discouraged are less likely to succumb to stress and burnout.

The competition for top talent is growing fiercer with each passing day. Hunting for Deciders might just give you the secret ingredient for success as a recruiter.

Bullhorn Reach recently published the results of a survey of more than 35,000 recruiters in its user network, tracking their use of social media. The survey focused on LinkedIn, Facebook, and Twitter.

The findings are surprising. Only 21% of Bullhorn recruiters are using all three social networks. In fact, 48% are using only LinkedIn! Apparently these recruiters haven’t seen the study from Jobvite that showed that, in 2011, 50% of job-seekers used Facebook to find a job, 25% used Twitter, while only 26% used LinkedIn. Why aren’t recruiters fishing where the fish are?

Of course, the use of social media, by either recruiters or job-seekers, doesn’t necessarily mean success. But in case after case, I’ve found that it does.

For example, in 2010, UPS announced that it received applications from 680 people who arrived via Twitter — and hired 45 of them. Almost 4,000 people applied via Facebook, 226 of whom were hired. Heck, UPS even received 1,000 applications from candidates communicating via text messages. But I bet few recruiters have created a strategy for texting.

We also recommend our clients use YouTube for talent acquisition. Though it’s the world’s second-largest search engine (second to its parent Google), you’d be amazed at how few people actually have a YouTube recruitment strategy in place.

The Jobvite study goes on to state that 18.4 million Americans “say Facebook got them their current job.” Only 10.2 million Americans give LinkedIn that credit, which isn’t much more than the 8 million jobs that were the result of Twitter. Bullhorn’s survey states that “a Twitter follower is almost three times more likely to apply to a job posting than a LinkedIn connection.” So why are less than half of its recruiters using Twitter?

I think I know why. As I told ERE’s Todd Raphael, Twitter can be intimidating to recruiters because of the sheer volume of information. It takes a focused professional, not just a summer intern, to monitor your chosen keywords and engage job-seekers. Twitter can be a time suck and also presents the daunting opportunity to have public conversations with applicants. But conversations can begin on Twitter and then become private, via direct message, email, or even a phone call.

Whatever the reason, recruiters who aren’t using all three major social networks are missing out on millions of applicants. As applications like BranchOut and BeKnown bring more professional searches to Facebook, recruiters who remain exclusively on LinkedIn will be losing the competition for top talent.

1. Treat ALL people like gold

2. Hire for personality and culture fit

3. Hire for a skill set that drives results

4. Communicate like no other

5. Onboard like a champion

 

They say it takes a village to raise a child — a proverb that I have recently learned translates to recruiting physicians, clinicians, and administrative associates for our new hospital. Nemours Children’s Hospital is currently recruiting 600 new associates for its 95-bed facility, which anchors our 60-acre, fully integrated pediatric health care campus. And, we have taken an innovative approach to interviewing potential candidates that gives our most important stakeholders — patients and families — a voice in hiring the best possible health care providers and administrative leaders.

The Idea

As human resources professionals, we are continuously searching for ways to enhance our ability to recruit superior employees for our organizations. Traditional recruitment tactics have focused on pleasing internal stakeholders. We evaluate a candidate’s skills and experience, as well as behavioral qualities to ensure the candidate is both technically qualified and a fit for our organization’s culture. Is the candidate willing to perform services in a way that we think is best for the patient? Sure. But, it’s almost never asked if the candidate is willing to perform services in a way that the customer feels is best for themselves and their child.

Nemours Children’s Hospital tasked the human resources team to challenge the status quo and create a new method for the recruitment and selection process that would forge a direct partnership between our customers and the hospital.

The Family Advisory Council is comprised of diverse individuals whose experiences in pediatric health care are helping shape the design and operation of Nemours Children’s Hospital. To lend our external stakeholders a voice in the recruitment process, we used this unique asset and created a process to allow our Council members to interview select candidates for the new hospital.

The Process

Developing an effective protocol for Council interviews with potential candidates would be a challenge. The Council is supporting the development of a family-centered patient care model that requires open communication between health care providers, patients, and their family members. We determined that their feedback on candidates’ behavioral qualities would be most useful to ensuring we hire candidates that value the family-centered approach to patient care, and the human resources team provided training on behavioral interviewing techniques. The Council learned a variety of interview skills that would help them ask the right questions to assess candidates seeking positions in clinical and executive leadership roles. Together, we structured questions for each interview. Human resources then shared its vast knowledge in behavioral assessment to ensure we received pragmatic feedback from their interviews.

The Results

Feedback from the Council interviews has proved invaluable in the selection of the finest physicians and associates to manage our hospital. We have effectively avoided the pitfall of hiring a physician or administrative leader who may have met our organizational needs, but wasn’t a fit for the customer. We even selected one of our senior executive leaders over another candidate based on feedback from the Council interview. This is important because Nemours Children’s Hospital and its family-centered patient care model can only be successful if we recruit associates who believe in the model and see the value of partnering with families to realize the highest level of patient care. After all, you can have the best physician or clinician on your staff, but it won’t help anyone if the patients and their families are not comfortable under their care.

Our unique interview process has also earned Nemours Children’s Hospital recognition in the community. The Council was recognized with innovation awards from the Metro Orlando Economic Development Commission and Florida Hospital Association for its success and creativity in diversifying health care. Such recognition has generated high-quality prospects for our organization, enhancing the human resource department’s contributions to our organizational goals.

The Future

Our human resources team is entrenched in the process of hiring for the new hospital, which will open in October. I firmly believe that the families we look forward to serving at Nemours Children’s Hospital will reap the benefits of our investment in this one-of-a-kind behavioral interview process.

I hope to see more organizations involve their consumers and stakeholders in the recruitment process. Think about the day-to-day interactions you have with the educators who teach your children, police who keep your streets safe, or financial planners who manage your accounts. Imagine if you had a voice in recruiting those people, helping to select candidates who have your best interests at heart. Bringing this recruitment technique to more organizations empowers human resources professionals to build a new level of trust between customers and organizations, cultivating loyalty and creating a veritable village of highly invested stakeholders guiding your organization to a successful future.

Or why HR metrics need to focus on helping managers to improve their people management decision-making

For at least the last decade, HR departments around the world have been pouring tons of time and money into developing HR metrics. Unfortunately, that effort has largely led to continued levels of frustration and, at best, a large number of what I call “so-what” metrics with little strategic impact. It doesn’t matter whether your HR metrics were provided as part of the software that you purchased or if they came from a major HR consulting firm; the results have been the same: dismal at best. After three plus decades of thought leadership and research in HR metrics, I’ve concluded that the current approach is an abject failure and that HR simply can’t continue on this current painful path.

The time has come to completely disregard today’s approach and to look to other functions that have had significantly better luck influencing executives with their metrics (i.e. customer service, supply chain, branding, and finance, to name a few). Even if you are currently happy with your metrics, this article should provide you with sufficient reasons as to why you should rethink your approach and to shift toward what I call “people management decision-making metrics,” a far superior approach that focuses on helping managers improve their people-management decision-making.

The Top 20 Major Faults With Most HR Metric Approaches

It is possible to avoid metrics altogether. For example, you can find out how well you’re doing in HR simply by counting your budget increases, your new headcount increases, or tracking how often you are mentioned in the annual report. However, if your goal is to improve the quality of your people management decisions and be metric driven, you need to assess your current metric approach using the following 20 faults as assessment factors.

Past vs. Forecasting Faults

Reporting what happened “yesterday” has little value – Almost all HR metrics report history, because they tell you what happened last quarter or even last year. Learning that your turnover rate was 6% last year has little value in a fast-changing world where your turnover rate could double next quarter. The best metrics cover your current time period.

We don’t provide forward-looking metrics or predictive analytics – Even today’s metrics may be of less value than future forecasts. This is because every decision-maker really wants to know what problems or opportunities will occur over the next week or months so they can work to prevent them. However, HR simply doesn’t provide these forward-looking predictors, which are known as predictive metrics or analytics. As a result, decision-makers are forced to quickly react to suddenly occurring people-management problems because they weren’t given a chance to prevent or mitigate them as a result of forecasts. HR needs to implement “predictive HR” (which follows the predictive policing model), where analytics tell HR and managers where they can most likely expect today’s and tomorrow’s people-management problems. 

Business Impact Faults

We don’t provide “dollar and goal impacts” in our metrics – Long before there was an HR function, executives and managers have been in love with dollars. At least outside of HR, everyone knows that a problem or opportunity won’t be considered by executives as critical unless it has a direct dollar impact on corporate goals (i.e. revenues, sales, or profit, all of which are measured in dollars). HR does report less-important cost metrics (i.e. cost of a hire), but cost metrics do not impact topline growth (i.e. revenue growth), the single metric that CEOs care most about.

HR needs to calculate its direct dollar impact on each major corporate goal like revenue, but also customer service, innovation, and quality. Although almost everyone in HR assumes that this can’t be done, other “soft” business functions like branding and customer service have successfully worked with the CFO’s office to translate their standard “what-happened” metrics so that they reveal their dollar impact on revenue and business goals (I call them “business case metrics”). You can, for example, report that your employee turnover has increased 12% until you’re blue in the face and no one will pay much attention. But the minute you translate it into dollars, “losing key staff reduced revenue by $17.2 million” everyone will demand a solution immediately. Continually providing business case metrics will not only increase HR’s credibility but will also increase your funding.

HR doesn’t calculate the dollar cost of doing nothing and excessive cost-cutting – Weak metrics and delayed reporting together can result in simple people-management problems exploding into major catastrophes, because no action was taken. One of the best ways to speed up decisions and action is to calculate and report the cost of slow decision-making or doing nothing. Just like a cancer in the body, delayed decision-making can turn solvable problems into catastrophes. In the same light, HR must reduce uninformed HR cost-cutting decisions by calculating and reporting the dollar impact of excessive cost-cutting in people-management programs (e.g. reducing safety training may save a few dollars in the short term but the long-term increase in accident costs and insurance make the initial savings insignificant).

We don’t calculate risk metrics – One of the hottest areas in business is calculating metrics for major business risks. Unfortunately, most HR departments simply don’t have a capability in the risk area. I’m not referring to potential legal risks. Instead, we need to calculate the major risks involved in more impactful problems like key employee turnover, weak hiring, poor employee development, a lack of leaders, and the tremendous cost associated with retaining bad-managers.

The most common business metric, ROI, isn’t even calculated -- The most important and commonly calculated metric in any business function or program is its ROI, which is simply the ratio of its cost compared to the dollar of return from that expenditure. Unfortunately, most HR functions don’t even calculate their ROI. The formula for this primary HR metric (a.k.a. workforce productivity) is the ratio of corporate profits compared to total labor and HR costs combined. Not only should this powerful ratio improve each year but it should be superior to the workforce productivity results produced by your competitors. 

Decision-making and Action-related Faults

HR metrics do not drive action – One of the primary reasons for developing metrics is to drive actions that result in continuous improvement. In fact, I classify HR metrics into two types, 1) “so-what metrics” (i.e. that’s interesting) and 2) “action metrics,” which result in someone taking an action after reading them. If HR metrics don’t actually change behavior, why do we have them? It’s quite easy to determine if your metrics drive action. Simply distribute your metrics in the normal way and then interview your users a month later and ask them simply “what major actions did you take as a result of these metrics?” If they didn’t act or change their decision-making (which is the normal answer), you have failed.

HR metrics are not designed for decision-making – To further complicate the metric problem, when HR reports its metrics, they are not even provided in a decision-making format. The metrics from HR are not accompanied by information that can drive decision-making (i.e. “what decision must be made?; what is the cost of doing nothing?; who must make it?; by when?; What is the recommended course of action?). This fundamental omission is almost unexplainable. If you expect professionals to make decisions, you must provide decision guidance tools that facilitate immediate and accurate decision-making.

The absence of “why” in our metrics makes taking action difficult – Almost all HR metrics focus on telling you “what happened” (i.e. turnover increased 2%, time to fill decreased 1%). And although the raw number revealing what happened is obviously important, in order to fix problems, metrics must also reveal the root causes of the problem (what are the causes? why did this happen?). As result, even if executives or managers are alarmed by your “what happened metrics,” they can’t take accurate action immediately because they have to wait to learn precisely why these changes have occurred. And in many cases, HR doesn’t gather metrics covering why things happen.

HR metrics are not provided in real time – Even forecasted problems and opportunities can arrive almost overnight, without much warning. Rather than being part of the steady predictable trend, these problems and opportunities seem to come out of nowhere. In a chaotic world, trend lines and historical data by themselves have a limited value. Instead, what is needed is real-time or virtual monitoring data on what is happening now. Once again, HR fails because it seldom can even accurately report a simple metric, like headcount, in real time. If it takes a week or month to gather data, in many cases, the wait will cause the decision to be “made for you” as a result of the passage of time. Real-time metrics might include today’s workforce productivity, this week’s turnover, this week’s engagement scores, or the relative availability of top talent in the market today.

Our metrics are not directly available to line managers – Let’s face it: most HR metrics are only designed for the use of HR professionals, and these metrics are also only provided to HR. HR professionals do need these metrics because we provide advice, but the individuals who actually make the daily people-management decisions (line managers) also need direct access to HR metrics. Although there are few exceptions, line managers often must consult with their HR professional in order to get the metrics they need for decision-making. Instead, what we must do is to provide real-time people management metrics and data, in a decision-making format, directly to line managers. The data must be provided to them in a user-friendly format and on their smart phone or tablet computer, so that they can make most routine people-management decisions independently but accurately.

HR metrics are not embedded in standard business reports — Even valuable metrics that are placed in a standalone HR report are liable to be missed by executives, simply because they don’t get around to reading them. The metric reports that executives do read and pay attention to are weekly or monthly standard business and financial reports. But if your metrics are not reported in these standard reports, they will not drive action. And because many HR metrics (i.e. employee turnover and weak hiring) do have a significant business impact, it only makes sense that they should be provided alongside the business-impact metrics from finance and marketing.

HR provides no external metrics — Almost without exception, 100% of the metrics that we provide to HR staff and line managers are internal metrics, covering things that happened inside the organization. But unfortunately, no organization exists in a vacuum. For example, the success of recruiting and retention are both dramatically impacted by the area’s unemployment rate (an external metric). Actions by talent competitors (i.e. hiring freezes and spurts, layoffs, and mergers) can also dramatically impact our recruiting and retention results. Compensation’s impact can be dramatically changed by monthly changes in the prevailing wage rates.

Other relevant external metrics might include interest rates, healthcare costs, commuting costs, and the cost of relocating. What is needed is a mixed approach, where decision-makers are provided with “integrated metrics” (including both internal and external data) that provides the broad range of relevant information that is required for accurate decision-making.

HR makes comparisons difficult – Almost without exception, HR metrics include a single number (i.e. our turnover was 6%). But a single number doesn’t tell you relatively where you stand. In order to make it clear where you stand compared to a standard, every reported metric must also include benchmark comparison numbers (i.e. our turnover is 14% but the industry average is 5%). This will allow managers and HR functions to compare their performance, not just to last year but also to the best, the average, and the worst within your firm and also within the industry 100%. HR does some benchmarking but it doesn’t integrate and share those numbers simultaneously with the metrics that it provides decision-makers. HR also frequently avoids preparing and widely distributing “ranked” lists of performance metrics (where the performance results of individual managers are ranked). Distributing ranked results can increase internal competition and improve best-practice sharing.

We don’t track decisions over time – If one of your primary goals is to increase the speed and quality of people-management decision-making, you need to track major decisions over time in order to determine if they improved and by how much. Unfortunately, only one firm that I am aware of has ever tracked their decisions to determine whether they improved and whether HR had a major impact on that improvement.

HR doesn’t provide just-in-time alerts — Even the best forward-looking predictive analytics will fail to forecast some major problems or opportunities. In these cases, HR metrics must have the capability of alerting decision-makers so they can act immediately. In the case of opportunities, this might include notifying managers immediately after the recruiting function learns that a key employee at a competitor is leaving (so that they can be recruited even before a requisition is opened) or when a competitor is about to undergo a major layoff, making recruiting away their talent much easier.

Metric-selection-related Faults

We fail to provide algorithms that make HR more precise – Algorithms are mathematical formulas or equations that are designed to accurately identify the precise actions required in order to improve HR results. Google, for example, has developed extremely accurate algorithms for hiring, retentio,n and leadership. Unfortunately, the HR functions at few other firms have even explored the value of algorithms in directing HR actions. Perhaps because all too often, HR professionals seem to be enamored with intuition and speculation rather than relying on data supported decision making.

The number of metrics HR provides is too large – Because in many cases, HR doesn’t really know what metrics decision-makers want, they provide a huge array of metrics. Often these metrics are not prioritized so the sheer number causes confusion and frustration on the part of users. A superior approach is to focus on the metrics that decision-makers care most about and that have the most impact on business results. The ideal number of strategic metrics may be five or less.

We provide mostly tactical metrics — Most of the metrics that HR provides to executives are tactical metrics, which means that they focus on transactions, efficiency, and cost savings. Instead, we should only report strategic metrics to senior managers and executives. These strategic metrics might include the productivity of the workforce, the dollar impact of losing key employees, the dollar impact of superior hiring, and the dollar impact resulting from the development of our employees.

Our metrics are selected in isolation – Literally every HR metric selection process that I have encountered makes a selection based on HR administrative ease, and the decision is made exclusively by HR professionals. The problem with that approach is that the end users (managers) are not involved in the final decision on the metrics slate to be used. Instead, at the very least, the CFO (the undisputed king of metrics) should be involved throughout the process both because of their expertise but also because they provide your metrics slate with credibility.

Final Thoughts

I understand the reluctance of HR leaders to abandon their current approach but it’s time to realize that when you compare our metrics to those of other business functions, even the most optimistic cannot put us in the same league with them. For example, the production function measures and strives for 6 sigma quality results (approximately three errors per million iterations) but no one even dares to calculate the error rates in HR programs like performance management, recruiting, or retention.

If the above critique and analysis are not credible to you, I suggest you take your HR metrics process over to supply chain or quality control and ask them to conduct a direct side-by-side comparison. It’s time to face reality: decision-making in the business world is becoming more and more numbers and data-driven and our current historical report based metrics approach is … so last century!

I met with a client today who made me smile — a Cheshire-Cat-Eating-Grin Smile, as a matter of fact.

He said, “Heather, I need to invest in the screening phase to figure out if these candidates are a good fit for our culture and our clients. That way, I don’t have to give up resources when I fire them later.”

DUH! 

After I wiped the grin off my face, I told him I was proud of him and glad to hear it. (I refrained from reminding him I’ve been preachin’ that for years.)

Pay now or pay later … either way you’ll pay. 

If you are a recruiter, HR professional, supervisor, or leader who wants to fill the seat, there is no need to read more of this post. Good luck to you.

However, if you want to fit someone with your organization and have him stick, read on.

Corporate culture can be described as the “norms” shared by employees in an organization that control the way they interact with each other, with other stakeholders and with customers.

I believe corporate culture is made up of the following:

Vision & Mission

Where your organization is going and how it plans to get there are important to the majority of people who live and work on this planet. Take the time to educate yourself in these subjects and make sure you are communicating them to your candidates. Better yet, have your candidates tell you why and how they believe they “fit” within your plans.

Organizational Values

The principles your organization holds itself to (I like to say these are the things you are not willing to compromise along the journey) will speak volumes to potential candidates. Likewise, candidate values and behaviors should speak volumes to you. If you see behaviors that are at odds with your corporate values, it’s a good chance the individual will have a hard time fitting in.

Work Environment

Work environment can include things like dress code, office spaces, group/staff spaces, etc. It could also include things like ability to telecommute, group thinking sessions, meeting protocols, etc. Whenever possible, walk the candidate around, allow him/her to talk with staff during the screening process, and encourage questions about the work environment so there are no surprises (and mis-fits) later.

Leadership Style

Leadership styles are a critical part of an organization’s culture and sub-cultures. Consider what types of leadership styles are being used most of the time.  Don’t make it difficult; generalize into the basic three: autocratic, democratic, and laissez faire. Engage with the candidate about these issues. Tell stories, offer examples, etc. Trust me, if you throw a perfectly capable and competent person into a team where the leader is predominantly autocratic, you’ll be re-recruiting within six months.

Organizational Structure

Organizational structure is how your departments, programs, or offices are organized, what type of power/authority is delegated to them, etc. This has a huge impact on corporate culture as it strongly affects communication, efficiencies, effectiveness, and sanity. Engaging with candidates about their comfort level with autonomy, or lack thereof, or talking with them about what they see as the pros/cons of your structure may give you some insight into how they will fit into the “lines” and how they will manage to work “in the white space.”

Personal Qualities of Workforce

The qualities of the current workforce play a big part in the culture because they are the ones living and breathing it. I didn’t use the word “personalities,” but to be honest, personalities are a part of this. Is the staff a group of high performers or entitlement whiners? Are they competitive or complacent? Are they welcoming or do they live in their cliques? Are they social butterflies or hermits? These are the realities of the workforce, and your new hire will need to compliment them, not work against them.

In summary, corporate culture isn’t something the CEO defines and gets “blessed” and implemented. It’s the norms that are created over time by leadership and the workforce.

Culture shock is a waste of time for everyone involved so may I suggest you invest your resources now so you’re not wasting them later.

Why HR Must Prioritize Its Internal Customers

Prioritization is one of the highest-ROI practices available to HR leaders, but unfortunately most in HR have failed to take advantage of it. It takes very little time or money to prioritize your internal customers, but the results can be dramatic.

Prioritizing can result in a 10% to 20% increase in your business impacts, without any additional budget. In talent management, you can prioritize positions for recruiting, individuals for retention and development, and you can prioritize business units so that you can target and focus your efforts to improve productivity and innovation. The primary reason why prioritization works is because you are able to focus HR resources and speed up your response time on the problem areas and opportunities that can produce the greatest business results.

Some Quick Examples of the Positive Impacts of Prioritization

If you managed an airline, hiring for every position would be important. But if you didn’t prioritize the fast hiring of pilots when a pilot vacancy occurred, your planes will sit idle, and as a result you would lose millions. You also get a larger impact in retention if you prioritize and focus your efforts on critical impact positions. For example, if you managed the NFL champion Giants, you would certainly like to keep everyone on your staff who contributed to your victory, but it would be smart to focus your retention efforts first on your star quarterback, rather than your best Gatorade guy!

Prioritization is Common Throughout the Business

Most in HR are supporters of “equal treatment” because of employment lawsuits. And as a result, HR is usually the largest resister to prioritization. But be aware that whether you realize it or not much of what we do in HR is already prioritized. Some individuals get paid significantly more than others, indicating their relative importance or priority to the organization. Some management positions get different benefits and privileges that most employees do not get. When we lay off large numbers of people, we are essentially prioritizing and releasing the low-priority employees. And finally, if we train replacements for some positions but not for others, we are in essence admitting that one job is more important than the other (because it requires an available replacement).

Most other business functions have long ago shifted to a prioritization schema. For example, in customer service, not all customers are treated the same, because some customers simply spend more money. In retail, all products are not treated the same because some provide much higher margins. Supply chain prioritizes shipments, and advertising prioritizes its channels based on the results they produce. Because the other business functions are so far ahead and prioritization, the first step that I recommend to HR leaders who are considering prioritization is to work with these other functions to learn their best practices and the measures that they use to prioritize.

The Benefits of Prioritization in Talent Management and HR

If increasing corporate revenues is a major strategic goal for your firm, you can help to meet that goal by prioritizing the hiring in revenue-generating jobs that obviously can’t produce revenue when they are vacant. And as a result, if you filled these revenue jobs faster, you would significantly increase corporate revenue. If you also hired better quality and better-performing individuals in sales jobs, you could also show an increase in sales revenue. If you also prioritized your retention efforts, a focused retention effort might be able to prevent your sales manager from leaving for another firm.

Prioritizing jobs, individuals, and business units can also increase productivity, innovation, and profits. By providing a faster and higher-quality response to high-impact jobs and individuals, you would get a moderately higher return than when you spread your resources evenly and a much higher return than when you focus your resources on the squeaky wheel.

For example, two different major quick service restaurant chains prioritized store manager jobs after finding out that a 30+% improvement in sales occurred when top-performing managers (but no other position) were placed at an individual store. A national retail chain found that losing a store manager by itself resulted in one million dollars in lost sales at the store over the next year. There was no similar drop in sales when any other position came vacant. With such a major impact, it is not surprising that many retail operations focus their best hiring, retention, and development efforts on store managers.

Prioritization Doesn’t Mean Bad Treatment or Low Morale

Prioritization is the process of identifying which areas should get the fastest or the most attention. Lower-priority jobs, employees, or managers under most approaches never receive “bad treatment.” The budget may be a little smaller, the service may be a little slower, and it may come from a more junior HR employee, but the same quality level is maintained throughout. Incidentally, if you’re concerned about creating a ruckus, there is no hard and fast rule that requires that HR reveal to managers and employees that it is prioritizing its services or what priority they are given. 

How HR Can Ensure That “Non-critical” People Don’t Feel Demoralized

This is by far the most common question from HR practitioners, particularly those who love to argue that all employees should be treated equitably. The short and simple answer is that prioritizing mission-critical or key jobs positively impacts everyone and hurts no one. By focusing on these jobs, the organization optimizes its chances at success which in turn helps drive job security, enhanced rewards (bonuses), career advancement opportunities, and reputation for all. Being on a winning team raises every participant’s value in the marketplace for labor. This is very evident in professional sports where every team member wants the strongest players on the field when the score is tied and only two minutes remain on the clock.

To help employees adjust, organizations need to educate them on the value that comes to them as result of this initiative. I am a firm believer that organizations should not only prioritize jobs, but they should also actively communicate with employees how the jobs are prioritized, why they are prioritized, and what the current ranking looks like. Once they are informed, employees can then see what skills they need to add and where they need to move if they want to be in a high-priority job.

Prioritization Doesn’t Mean Senior Executives

Many assume that prioritization efforts result in identifying executives as the most important employees. And in fact, when HR is asked to prioritize jobs that are mission critical to the organization for the first time, many human resource professionals do come back with the top few rungs of the organization chart.  However, when they are forced to really think about what positions in the organization have the ability to immediately impact a firm’s time-to-market or quality of good or service being offered, the list of critical positions changes becomes a lot different. In fact, the focus moves from the top of the organization to positions much lower in the organization that produce revenue, touch the customer, or provide the skill set needed to develop/deliver the primary features that differentiate a good or service line. You see this in major sports, where the emphasis is clearly placed on a few key roles.

Although HR might not like to admit it, there may be a 80/20 rule in effect — 80% of what drives the capability and the success of a firm lies in just 20% of its people. In most organizations and especially in high-tech firms, the key individuals are instead located in the middle of the organizational chart. Starbucks even inverts it organizational chart (putting employees at the top and executives at the bottom) in order to show how important lower-level employees are to their success. Firms like Microsoft have been identifying their top 1,000 most-impactful employees for years and firms like Edwards Lifesciences, Motorola, Valero, and MGM Grand have a history of job prioritization. 

It’s Time for HR to Act More Business-like

For years HR has suffered through reduced budgets. One of the best solutions when you are faced with limited resources and time is to develop some logical process of allocating resources, so that the largest amount of resources goes to the most impactful HR problems. It’s time for HR to stop handling “things in the order that they came in” and treating all problems as equal. Instead, it only makes sense to prioritize and put the most time and dollars into hiring, retaining, and developing employees that have the highest “priority” or weight.

In next week’s Part 2, you will find a list of the actions and the execution steps that you need to take in order to prioritize your employees, jobs, managers, and business units.