By Magi Graziano

The world’s business innovators—such people as the director of Wharton’s Center for Human Resources Peter Capelli, Korn Ferry’s vice chairman Dennis Carey, and McKinsey & Company’s Global Managing Director Dominic Barton—have been calling for reinvention and transformation of human resources (HR) departments.1 Critics say that HR managers focus too much on “administrivia” and lack vision and strategic insight.

How leaders feel about HR reflects what is going on in the economy. When the economy is down and the labor market is slack, they see HR as a nuisance. In some organizations, HR is simply slapping bandages on problems that will persist until executives make talent issues a clear priority. It might be said that HR invests heavily in programs that can lack impact; for example, worrying about how millennials want to work.2

Given that the majority of hiring responsibilities fall within HR and it is—in most cases—the entry into an organization, reinventing HR can start with transforming the way leaders think about hiring. Innovative leaders are already operating highly effective, “conscious hiring” programs to attract the best people.

Conscious hiring is a proven hiring methodology that provides both the employer and the potential employee with a clear picture of the role, purpose, and requirements, as well as the candidate's strengths and weaknesses and how that correlates to delivering on the purpose of the role. This methodology allows a person to increase his or her confidence when selecting the right person for a job.

It also helps to define the selection criteria so that the hiring personnel automatically filter out the people who are not a match and attract those who are. It also allows those who are doing the hiring to invest their time and resources into interviewing highly-qualified candidates.

Conscious hiring also uses a tool for evaluating everything from candidate motivations, values, and behaviors to communication style, personality traits, skills, mental agility, and organizational ability, so hiring managers ensure they have all the information needed to hire effectively.

This high energy, provocative, insightful, and fun training encompasses every aspect of building an effective, defensible, and foolproof hiring process.3 For a real-life example of a company shifting the HR focus from task oriented to strategy oriented, look to the case of Comcast, who is bringing world-class IT capabilities in-house. HR is taking the lead to attract and retain the best talent with creative ideas, including those of building and supporting an IT community and targeting IT students and recent graduates for jobs and internships.4

Employees’ perspectives, outlook, attitudes about work, and their ability to manifest what they want—when they want it—has spurred a fundamental shift in the way people operate in today’s workplace. With a plethora of newly created job options, coupled with baby boomer retirements in the workforce, smart organizations must equip themselves to navigate through new employee and workplace models.

Managers and leaders are aware of the fiscal costs of a mis-hire, but several invisible and potentially insidious costs can wreak havoc on an organization. Although it might not be top of mind, when you hire a person who does not fit with your organizational culture and operating philosophy, the impacts are pervasive throughout the organization.

By continuing to operate with outdated hiring practices, including the family and friends selection model (a shot, a beer, and a job offer), traditional interviews are also a poor predictor of success, because most people are not trained in the pitfalls and human dynamics of interviews. The fate of most hiring decisions, like first dates, all too often hinges on how the interviewer "feels" after the first 10 minutes of the interview.

If their gut instinct says, "I like or don't like this person," the rest of the time is spent hearing answers to questions in the way the interviewer wants to hear the answers. Unbeknownst to the interviewer and interviewee, this way of listening is happening at an unconscious level and interview success is often determined by "whom" from the past the candidate reminds the interviewer of, for better or for worse.

Beyond the unconscious listening and interpreting that is happening, interviewing in the traditional sense does not validate how a person will perform.

Another outdated hiring practice is boardroom-style panel interviews where the candidate is interstates with superfluous questions that either are made up on the spot by unskilled interviewers or downloaded off the internet by someone who wants to look smart but doesn't know the first thing about conducting effective interviews with complex and dynamic human beings.

Another pitfall and outdated hiring process, only because there is a piece missing, is trying to assess performance through interview problem-solving exercises. While if debriefed appropriately, this method could work as an element of a candidate’s vetting process, the problem solving exercise alone doesn't give enough information on how a person comes to a solution in a pressure-based situation. It is not conclusive of if, when, and how the person will act in the real world.

As in most cases with experiential-based learning, the power is in an effective debriefing. Open-ended, values-based, and behavioral-based debriefing of exoeriential exercises, coupled with well thought-out work history interviews and values-based interview questions, are three key elements of an effective hiring process.

Additionally, there is so much time invested on the resume-screening and interview process that when a candidate looks close, even when not ideal, hiring managers try to make it right instead of moving on.5

An organization becomes susceptible to four specific hidden consequences of a mis-hire:

1.  Fragmented customer service. Ensuring your team understands your service set and why residents use services is where excellent service begins. You can—and ought to—bridge the knowledge gap for new hires with comprehensive product and service training; however, you cannot train your workers to care about the customer.

Behavioral and performance research shows that great service is delivered through a fundamental set of values, attitudes, and beliefs that are in alignment with a service philosophy. When people are in a customer service role for the wrong reasons, for example, no training in the world will compensate for their lack of connection to the work itself.

This is a common experience when expecting one level of affinity from the place where people spend their money and then receive service that is counter to that expectation. This leads to feeling disengaged and dissatisfied, and even extreme anger.

So when you hire employees whose hearts are not aligned with your local government and organizational mission and service offerings, or they lack the basic service acumen to execute customer service objectives, this same level of dissatisfaction is what residents experience. 

2.  Reduction in innovation. Organizations arrive at a sustainable strategy model through innovation, creativity, and a keen awareness of how to bridge a gap in community services. Once the product set is stable and residents are satisfied, continual improvement and innovation is required to stay ahead of the copycat curve. When some employees cannot seem to get it together, miss basic deadlines, or don’t find problems until residents do, innovation is not even an option.

When an employee is hired because his or her resume lists the right key words, yet the person behind the resume lacks conceptual-thinking ability and theoretical problem solving, he or she lacks the ability to come up with creative and inventive solutions. Often, this lack of ability shows up as excuses, finger pointing, and roadblocks outside of his or her control.

It is important to be aware that employees who lack these traits are unaware they lack them and that most often, these traits and competencies are extremely difficult to teach. When your organization needs to innovate, you need people for innovation-focused initiatives who possess strong natural abilities for complex problem solving, theoretical problem solving, conceptual thinking, and proactive thinking. People who value the theoretical, also value innovation.

3.  Workforce productivity. When you hire in a hurry, you experience unwanted turnover. If you are lucky the turnover happens fast. Yet in most cases, it is months before the problem surfaces and the impact of the wrong person doing the job wrong has already disseminated throughout a team, if not a department.

In high-level roles, the impact is detrimental not only in the immediate area of influence; it permeates throughout the organization. Tolerating people who are not engaged and thriving waters down the engagement and productivity of those who want to win.

When any of these morale and engagement busters are happening within your culture, good people either leave or move into autopilot until they can leave. The indirect and costly impacts are higher staffing costs to make up for the lack of employee and team productivity; institutional knowledge loss when talented, trained people leave; and increased training costs to continually retrain new blood into the organization.

4.  Time and energy losses for the team and leadership. You undoubtedly know about the 80-20 rule; when applied to the workplace it means that 80 percent of a manager’s time is spent with the bottom 20 percent of performers. As it happens, this statement may be closer to 30 percent of the underperformers.

As the competition for talent increases and the fear of the empty chair blocks good sense, you can feel pressured to fill the job with the first decent person who surfaces with a cogent resume. Hiring the wrong people because you are “in a rush” to fill a seat leads to more empty seats, or worse: full seats with empty payoffs.

One of the hidden costs of unwanted turnover as reported in recent employee and manager engagement surveys is that 70 percent of managers surveyed reported that they are coping with burnout and a job-misery rating that is detrimental to their overall happiness.6 When the workplace culture turns into one of micromanagement, correction, and reprimand rather than collaboration, creation, and mentoring, the manager’s job becomes one of parent and babysitter.

Managers and leaders might look to HR to fix situations that could have been avoided by demonstrating more consciousness and awareness before, during, and after hiring. It seems like in many organizations, an admission of making a poor hire is a far worse offense than allowing and tolerating subpar performance.

Furthermore, the cost of doing nothing about a bad hire far outweighs the cost of being proactive and creating high-impact hiring solutions. Tech companies like Google, Microsoft, and Apple are now on the front lines of HR innovation, largely because they have an acute need for specialized talent. Human capital is practically their only major asset; talent is in short supply and competitors are eager to lure employees away.

There also has been some creative HR thinking in financial services in order to predict and ward off unethical behavior. JPMorgan, for instance, is using an algorithm to identify employees who are likely to break the rules.

No crisis or scandal is necessary for HR to transform its practices, though. Nor should the function focus solely on innovations in hiring. Discretionary effort by employees who are engaged and willing to give their best is at the heart of organizational success, and managing and developing people is the way to drive and sustain that effort.7

When you think about it in terms of bottom-line expense and overall success, shifting your organization’s philosophy about people and hiring consciously just makes common sense.

1 https://hbr.org/2015/07/rethinking-hr.

2 https://hbr.org/2015/07/why-we-love-to-hate-hr-and-what-hr-can-do-about-it.

3 thewealthoftalent.com.

4 https://hbr.org/2015/07/why-we-love-to-hate-hr-and-what-hr-can-do-about-it.

5 http://www.inc.com/margaret-heffernan/hiring-recruiting-forget-interviews-hire-anyone.html.

6 Gallup’s 2013 State of the American Workplace poll. http://www.gallup.com/services/178514/state-american-workplace.aspx; http://www.gallup.com/poll/181289/majority-employees-not-engaged-despite-gains-2014.aspx; http://www.gallup.com/poll/181289/majority-employees-not-engaged-despite-gains-2014.aspx; http://www.nydailynews.com/news/national/70-u-s-workers-hate-job-poll-article-1.1381297.

7  https://hbr.org/2015/07/why-we-love-to-hate-hr-and-what-hr-can-do-about-it.