Fix Tech Hiring: Make It Data-Driven and People-Led

Tech hiring is broken, and the data from research is overwhelming. Below are a few highlights:

  1. Bad hires are extremely expensive. A study by the Society of Human Resource Management (SHRM) estimates the cost of a bad hire can be as high as 5x the salary. Zappos CEO Tony Hsieh has estimated bad hires cost his organization over $100M.
  2. Bad hires happen far too frequently. According to a study by the Brandon Hall Group, 95% of companies admit to recruiting the wrong people each year.
  3. Great hires are game changers. According to research by Linda Pittenger from the Embry-Riddle Aeronautical University, high performing technology personnel are 10x more effective than average performers.

With studies like these, it is no wonder that many solutions are being developed to ease the pain. So why does the problem still exist?

The answer is that innovative organizations need to be both data-driven and people-led.

Companies that are just data-driven will leave common sense and simple solutions behind. They will over-engineer every answer and forget the people-side. While those that are just people-led will follow their charismatic leader without the support of, you know, facts. Zappos is an interesting example of being both data-driven and people-led as they recognized the problem through measuring data and understood the people side with their solution of offering $2000 to employees to leave after the first week.

The problem of bad hires, however, can be greatly reduced far earlier than after the first week of training. According to Bersin by Deloitte, organizations with highly mature talent acquisition functions spend 2x more than those organizations with low maturity functions but have a “40 percent lower new-hire turnover and are able to fill vacancies 20 percent faster.”

And, we know where in the hiring process to look. Again from the Brandon Hall study, “69 percent of companies in our research identified a broken interview process as having the greatest impact on the quality of a hire.”

The problem specifically in tech hiring is that assessment and interviewing are particularly difficult. The pace of change in technology is breath-taking with the number of platforms, and technical skills make it impossible to keep up. Also, tech hires are in such demand that hiring managers feel the pressure to hire quickly.

Currently, most companies rely on unstructured interviews by their internal team possibly combined with a behavioral interview from HR and an online assessment of technical skills if they exist. This process is lengthy and disjointed.

One solution would have a resource that is both a subject matter expert and an interviewing expert. This expert can put the candidate at ease, go through a consistent, structured process to evaluate candidates evenly, and be able to ask the probing follow-up questions to truly understand the candidate’s capabilities.

You could invest in building this process internally by taking your best technology assets offline to focus on this work, but the best solution would be to leverage that expertise that already exists. The problem is that these skills have been previously inaccessible as they are dedicated to their particular technology craft at other great companies.

Technology has been used with great success to change many business models by connecting and utilizing previously under-utilized assets. AirBnB and Uber are two excellent examples. Expert Interview leverages these same principles to connect those rare technology experts that also know how to assess candidates and build teams. Stop over-engineering. Be data-driven and people-led.

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