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The Truth About Great Hires

By Kathy Barton, December 13, 2006

The Magic Number

Three is a magic number,
Yes it is, it's a magic number.
Somewhere in the ancient, mystic trinity
You get three as a magic number.

The past and the present and the future.
Faith and Hope and Charity,
The heart and the brain and the body
Give you three as a magic number

From Schoolhouse Rock.
http://www.schoolhouserock.tv/Three.html

There are three foundational principles to the Performance-based Hiring^sm system. Last time I wrote about the second, "Wait 30 Minutes". Lately I've been thinking about the third principle, "No 2s". (No, this isn't about an unreasonable prejudice against the number two.) It's based on the Performance-based Hiring rating scale of the 10 Factor Candidate Assessment, developed by The Adler Group to assess candidate competency across a wide range of variables. Often hiring managers will focus on the areas that are most important to them (such as technical ability) and consider other factors less (like team skills or motivation). These 10 factors combine competency models, required skills and technical ability with the actual performance needs of the job to provide a highly accurate assessment of the candidate. The competency levels used in the 10 Factor Assessment are:

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1. Incompetent, unmotivated, uncooperative, distraction, demotivating, reactive, no potential to grow - Unqualified.
2. Needs extra training, needs extra pushing, needs urging, avoided, neutral, passive, not promotable - Less Qualified.
3. Meets high standards, self motivated, fully cooperative, a contributor, an asset, on top of issues, promotable - Fully Qualified,
4. Does it better, does more, faster, initiates helping, trains, sought-out, influences others, anticipates issues, quickly promotable - Highly Qualified.
5. Sets standards, 120% committed, proactively coaches, asked to lead, motivates others, forward-looking, double promotable - Super Star.

It doesn't take any special skill or training to recognize a 1 or a 5. (Just about anyone can do it.) The difficulty is in properly identifying 2s, 3s and 4s, - especially when someone may be a 3 in one area and a 4 in another. The goal of Performance-based Hiring is to consistently hire people who have the ability to do the job, want to do the job, and are a good fit for the job. 2s may have the ability to do the job, but are not motivated. Or, they may have some of the skills, but not others - like a very talented technical person who doesn't work well with others.

When I worked at GE, they used a similar scale to rate all employees. Their scale was reversed. 1 was the top score and 5 was the lowest, but the concept was similar. Employees at the top end of the range were given extra training and incentive stock options. Employees who rated at the bottom were let go; while, the equivalent of 2s were put on a performance plan - and if they didn't become a 3 within a specific period of time were also let go. At the time that made perfect sense to me. Since working with Lou, however, I think about how much easier it could have been if the company just didn't hire 1s or 2s to begin with. After all, nobody likes to fire people, even if the employee is under-performing. It's hard on the employee; it's hard on the manager; it's hard on the team.

You can easily recognize that Performance-based Hiring is about understanding how to avoid hiring 2s (and 1s, of course!). However, there is another important aspect to this that recruiters often see, which is the hiring manager who insists on hiring only 4s or 5s. I wonder if this is because they relate the five-point scale to academic grades -- as in 1 is an F and 5 is an A. That would make a 3 an average performer. When you read the description of a 3 on the 10 Factor Candidate Assessment, you realize that a 3 is already a top performer: "Meets high standards, self motivated, fully cooperative, a contributor, an asset, on top of issues, promotable - Fully Qualified." A 3 is a great hire! A 3 has the ability to do the job, wants to do the job, and is a good fit for the job. 3s are the people who come into work each day happy to be there. These employees have a high level of job satisfaction and low turnover. As a hiring manager I would be thrilled with a team of 3s; since they are promotable, their capabilities and strengths will improve over time. Let me repeat, a 3 is a great hire!

So how do you manage a hiring manager who insists that he or she will only hire 4s and 5s? Here are some questions you can ask to help a manager understand the value of hiring a fully qualified 3:

1. If I could find you a candidate who is fully capable of doing the job, wants to do the job, and is a good fit for us culturally, would that be a good hire?
2. A 4 or a 5 is someone who can be promoted quickly and expects to be promoted quickly. What is the next position for this person on your team and how soon do you expect to move this person into that position?
3. Does this position offer clear leadership and coaching opportunities?
4. Obviously, there are less 4s and 5s available in the market. So, there is going to be more competition for them. What is it about your job that is going to make it more desirable than a similar position with our competition?

2006 is the year when the demand for skilled labor began to exceed supply, due to demographic shifts in the workforce. This trend will increase significantly over time as the baby boom generation begins to retire. So, a manager who wants to hire only 4s and 5s is making this request at a time when simply finding fully qualified and motivated performers (i.e. 3s) is going to get harder and harder; when demand for talent will mean that turnover among all employees is going to increase. Hiring and retaining skilled, motivated, and satisfied employees is going to be a challenge for all hiring managers. So, hang on to those 3s. It really is a magic number.