Recruiting

3 Studies that Will Make Your Hiring Smarter

March 3, 2015

There are dozens of articles produced every day that promise to make recruiting effortless, one-click, and painless. The reality is… recruiting and hiring are hard. Especially if you value the caliber of talent you’re bringing into your organization.

So we turned to studies and examined how to use research to make your job as a hiring manager or recruiter easier. Here are 3, in particular, that will make your hiring smarter: 

1. Strong employer brands can hire better talent, cheaper.

In “The Value of Organizational Reputation in the Recruitment Context: A Brand-Equity Perspective” the authors examined how corporate reputations affected job seekers. In this case, they analogized reputation with “brand.” Their results found:

  1. Job seekers use reputation as a signal about job attributes, and
  2. Reputation affects the pride that individuals expect from organizational membership.

Employer pride > money.

“Moreover, individuals were willing to pay a premium in the form of lower wages to join firms with positive reputations, and individuals’ familiarity with organizations affected the amount of information they could recall about a recruitment job posting after 1 week.”

^ This, in a nutshell, is why everyone hiring a top-shelf software or aerospace engineer is battling against Google and SpaceX, et al.

Another interesting anecdote for HR departments who think advertising alone will solve this puzzle – “the results suggested that reputation advertising did not affect job seekers’ reputation perceptions”.  

Hiring Takeaway: 

Employer brand is the essential ingredient to successfully and regularly placing quality hires. And if your business relies on a pipeline in a tight talent market (like engineers) this has to be a departmental priority. HR should work in close collaboration with their marketing department on this. In his excellent post “The Next Frontier in Talent Acquisition Is Marketing” Michael Hennessy recommends:

Just like consumers, candidates take unique journeys toward the employer brand. Along the way, they look for relevant, consumable content that provides value.

For example, case studies or brand mission videos make great sense. On top of customer-generated content, you’ll also see employee-generated content heating up in 2015 and much of that fits naturally into the story you’re trying to tell.

2. Don’t Trust Your Gut. Use a Rubric!

In a candid interview with the New York Times, Laszlo Bock, senior vice president of people operations at Google shared several important insights from internal studies conducted at the internet goliath. Among their findings:

Most hiring decisions are driven by gut instinct (and not predictive of success).

Years ago, we did a study to determine whether anyone at Google is particularly good at hiring. We looked at tens of thousands of interviews, and everyone who had done the interviews and what they scored the candidate, and how that person ultimately performed in their job. We found zero relationship. It’s a complete random mess, except for one guy who was highly predictive because he only interviewed people for a very specialized area, where he happened to be the world’s leading expert.

Brainteaser interview questions “serve primarily to make the interviewer feel smart.”

Instead, what works well are structured behavioral interviews, where you have a consistent rubric for how you assess people, rather than having each interviewer just make stuff up.

Behavioral interviewing also works — where you’re not giving someone a hypothetical, but you’re starting with a question like, “Give me an example of a time when you solved an analytically difficult problem.” The interesting thing about the behavioral interview is that when you ask somebody to speak to their own experience, and you drill into that, you get two kinds of information. One is you get to see how they actually interacted in a real-world situation, and the valuable “meta” information you get about the candidate is a sense of what they consider to be difficult.

Hiring Takeaway: 

Interviewing (and interviewers) are imperfect. But behavioral interviews in combination with a rubric (that you continue to measure and refine) will place more successful candidates over time than your gut instinct alone.

3. Referrals are still your best talent pipeline.

A recently published study by Burks et al called “The Value of Hiring Through Employee Referrals,” substantiated that your best and most consistent talent pipeline is your current employees’ personal networks.

They used personnel data from nine large firms in three industries (call-centers, trucking, and high-tech) and found:

  1. Referred applicants are more likely to be hired and more likely to accept offers,
  2. Referred workers tend to have similar productivity compared to non-referred workers on most measures,
  3. Referred workers produce more patents in high-tech,
  4. Referred workers are substantially less likely to quit and earn slightly higher wages than non-referred workers.

And an interesting finding on cost:

In call-centers and trucking, the two industries for which we can calculate worker-level profits, referred workers yield substantially higher profits per worker than non-referred workers. These profit differences are driven by lower turnover and lower recruiting costs for referrals.

There’s still a place for non-referred workers, too. They study found they tended to be similarly skilled and had similar productivity to referred workers, they just didn’t enjoy the same advantages of already have a network in place upon arrival.

Hiring Takeaway: 

Your first go-to for hiring (particularly in niche job fields!) should be your current employees. Maybe now is time to look over your referral bonuses or remind your staff about them?

(If your referrals are coming up empty, we’re happy to help fill your engineering talent pipeline).

 

What have you read lately?

It’s fascinating to dig into the research behind hiring, motivation, and job seeker behavior. Sometimes it corroborates your gut instinct, but often it makes you think about things in a slightly different light.

We’d love to hear what you’ve read recently that got you thinking about recruiting and hiring. Continue the conversation in the comments below or on Twitter at @HireEngineers.

Featured image: Dan Zelazo/ Flickr