An Open Letter to The Staffing Advisor

I’ve watched a dialogue occur over the last couple of weeks between Brad Smart, the Author of Topgrading, and Bob Corlett who owns a recruiting firm in Washington DC and refers to himself as The Staffing Advisor for his Blog.

I’m genuinely concerned that by responding to the initial post of Mr. Corlett’s called, “What Exactly is a Top Performer?” Dr. Smart provided some credibility to what was written and provided an opportunity for this blog post to get some notoriety that it didn’t deserve. After reading Mr. Corlett’s rebuttal I simply can’t stay quiet.

Disclaimer: Topgrading is not a novel. Topgrading is not an easy read. Topgrading is not a page-turner. Honestly, Topgrading is about as dry as a piece of burnt toast without butter. With that being said, it’s still one of the best business books ever written.

Before I begin, I’m going to take a small tangent. The book Freakonomics sold more than 3 million copies when it was released 4 years ago. Buried within those pages was a chapter about the imperfection of the commission model for Realtors. It closely assessed the value of a Realtor’s contribution to the home selling process and found, in short, “the commission you pay your Realtor is in essence a big fat tip”.

I’ll complete my thoughts on why I’ve included this random snippet from Steven Levitt in my conclusion but I wanted to make sure I got that in on the front end to get you thinking.

On to the Open Letter…

I’d like to point out that I’m going to be jumping back and forth between both of Mr. Corlett’s posts on Topgrading (the second being his rebuttal) and his website. I’ll lead in with a direct quote as a precursor to that section to make it easy to follow.

Part 1

“I freely admit that I gave up and only made it halfway through [Topgrading] (worst beach read ever).”

“I found nothing that would help my clients make better hires, short of implementing a massive, formal, top heavy initiative to learn how to conduct a Topgrading interview. And that is simply not practical when you are hiring only one or two of each kind of person.”

I’ve grouped these quotes together to try to point out a very significant element of my counter to Mr. Corlett. If you’re [Bob Corlett] positioning yourself as an expert in the world of “Results Based Hiring” and you’re choosing to bash your “competition” in a very public forum, might it make sense to actually read the entire book before making blanket judgments and heavy-handed criticisms of a process and methodology that is proven to be wildly successful when implemented properly? You’ve lambasted every CEO who shares with you that they want to hire A-Players through Topgrading after admitting that you personally have an inability to finish the foremost book on the topic. Is this at all indicative of how you screen candidates whom you are considering presenting to your clients – that is, seeing a resume that is more than a page long, making a judgment after reading their address and then choosing to wholeheartedly endorse or count an applicant out?

Here’s the thing: if you can’t find a single item in this book to help your clients make better hires I truly doubt that you even read half of it. My guess is, you got to page 63, read the section about Search Firms and Brad’s suggestions on due diligence, and stopped.

Here are some examples of things that we have implemented and have helped our clients implement as well that we learned from inside the pages of Topgrading:

1. Take the time to build Scorecards. When we know what we’re looking for and then we can show the new hire what we screened them on and what we expect of them, the likelihood of their success (in our experience) improves exponentially. Interestingly enough, Mr. Corlett, you even mention this exact idea later in your blog when you said, “Here is a strategy that will dramatically improve both your results and the quality of your life: set performance goals [and] manage your people against the results.”* My guess is that you weren’t able to get far enough into the book to read that part.

2. TORC (threat of reference checks). We always check references but not the ones that our candidates are interested in giving us. We require and only talk to previous managers and we don’t let candidates advance in the process until that is finished. Geoff Smart, Brad’s son, suggests that about 25% of the information you learn about a candidate is obtained during reference checks. I think he’s right on.

3. Create a Virtual Bench. Jack Daly, an esteemed Public Speaker and former CEO is famous for saying, “It’s called RECRUITING, not ABSORBING”. We’ve got a list of people that we’re always recruiting and talking to in the event we need to hire them due to growth or turnover at American Workforce. Our clients do too!

Part 2

“In a job description you need to nail down exactly what you are looking for.”

“There is no universal set of attributes. It depends on the job.” “Most companies need a diverse mix of skills and work styles, but all with a common shared set of values.”

“Small organizations need to think hard, move fast, and make the best decisions possible with imperfect information.”

Really, I love Jack Daly. I bring him up again because I got to hear him recently and so much of it rang true. One of his favorite stories is about VISION and PLANNING. The story goes something like this:

Jack walked out of his house the other day and saw his neighbor filling his car with luggage. He was really cramming it in; filled up the trunk and then the back seat too.

Jack called out to him, “Hey, where you headed?”

“East!” his neighbor replied.

“How long you think it’s going to take you?” Jack countered.

“Quite a while, not sure really.” his neighbor shouted back.

“How much money you gonna need to get there?”

“Beats me, just hope I don’t run out!” said the neighbor.

I shared this story because I think that the next-door neighbor is a lot more like most small businesses than you could possibly imagine. Simply asking a hiring manager to write a job description when they have no experience doing it and hoping that they can “nail down exactly what they are looking for” is a lot tougher than it appears on the surface. Believing that your clients need to think hard and move fast while making decisions based on imperfect information as it relates to their hiring decisions is very, very dangerous. Not only does it adversely affect your ability to screen for the right kinds of people, it leaves your clients open to hiring based on “gut feel” and emotion instead of reality and strategy.

No, Topgrading is NOT easy. Neither is being an A-Player.

Part 3

“We’ll continue…developing faster, less expensive, less cumbersome ways to help our clients consistently hire people who will drive business results”.

There was a time when we thought about touting our speed to hire or cost per hire at American Workforce. Before we learned about Topgrading we were proud of our speed. Today, the focus isn’t on speed or cost at all. Rather, we focus on helping organizations change their methodology and expectations around hiring. We know that Topgrading has been effective when (1) our clients can hire the first or second person they interview – no matter what the role because the hiring managers know what they are looking for and (2) the employees perform as expected.

When Business Owners or Hiring Managers share with me that Topgrading is or was too hard it is almost always indicative of them being ill-prepared by not knowing what they actually want to hire or too reactionary in their hiring process (e.g. only thinking about new hires when someone leaves). As previously mentioned, these companies are simply absorbing new people, not recruiting them.

Part 4

“As someone who runs a search firm, I am also cognizant of the candidate perspective, which is generally not favorable toward Topgrading.”

Dave Kurlan, Founder and CEO of the Objective Management Group, has come up with the five major challenges that salespeople face and must overcome before they can be successful in sales.

The most significant of these challenges is something that he calls a “Need for Approval”. He describes it as, “Salespeople who have a high need for approval will avoid saying or doing the things which, in their mind, would change how the prospect feels about them. This includes asking tough questions, legitimate confrontation and the potential inability to handle rejection.”

At American Workforce we’ve actually had to screen out the Need for Approval from the people on our team who conduct interviews. Why? Our interviewers need to be able to interview with the clear understanding that it’s not their responsibility to make the candidates like them. Candidates don’t hire us – companies do. If the candidates can’t handle a company doing its due diligence and lose their temper or get easily frustrated, what does that say about how they will react under pressure in front of a client six months from now as an employee? Conducting Topgrading interviews takes focus and guts. Focus to stick with the plan and the guts to be able to ask the tough questions and not back off when someone gives a weak answer to a question because they either have something to hide or they’re too lazy to go into greater detail.

Conclusion

As promised, I want to finish my thought on why I included a whole paragraph about the commission structure of Realtors in the beginning of this Letter. When he really dug into it, Levitt found that Realtors aren’t really acting in the best interest of their clients. You can pretty easily figure out why when you consider the following:

-When they are selling a house their only incentive is speed, not getting the best price. They’re going to receive 3% of the sale price. To encourage a homeowner to reduce the cost of their home from $200,000 to $180,000 results in a net loss of only $600 to the realtor but they pick up a check for $5,400. The homeowner loses 10% of their value. If they [the Realtor] turn down a lowball offer and really stand up for the seller of the house, they risk not getting paid at all.

-When they are helping to buy a house, every dollar that they negotiate in savings for a buyer results in them making LESS money.

Here’s why I think this is so applicable to why nearly every recruiting company in America is denunciatory of Topgrading:

-If a company is paying a recruiter a percentage of the first year’s salary (akin to a Realtor receiving a percentage of the sale price), the ONLY incentive that recruiter has is to get someone hired quickly so they can avoid expending more than the minimum amount of effort. They are NOT incentivized to:

- ask tough questions

- conduct reference checks with past managers

- point out red flags on a resume or a career history form

-If a company is paying a recruiter to help negotiate compensation with a prospective candidate, every dollar they help the company save is costing them part of their commission.

Your recruiters should be partners with your company. Because they are truly incentivized against doing so, why should we expect any traditional recruiting firm, and especially ones like Staffing Advisors, to ever embrace the tenets of Topgrading?

Finally, Topgrading isn’t the ONLY way of recruiting and it can’t be implemented as an initiative from HR.  It must be adopted wholeheartedly and with the full endorsement of every Executive inside a company.  When this happens and it is implemented properly and executed on with precision, its results are staggering – no matter the size of the company.

About The Author:

Jonathan Davis is the author of the HIRE BETTER blog and also the CEO and Founder of Hire Better.

Jonathan has spent the last decade helping build companies from scratch. It started with an e-commerce company in New York City in the late 90’s and he quickly learned that he loved helping other companies build strong systems that would support rapid growth. After five years as a Principal of a Staff Leasing and HR-Outsourcing firm he started working on the one area where he saw the biggest lack of viable solutions for growing companies: Talent Acquisition. A self-professed “Operational Dork”, Jonathan is responsible for the strategic leadership of American Workforce as it continues to revolutionize the world of recruiting through a focus on metrics and innovation. He graduated from the University at Albany in upstate New York. An active member of the Young Entrepreneurs’ Organization (EO), he sits on the Global Committee for Emerging Programs and is the Austin Champion for EO’s Accelerator Program. He’ll graduate from the MIT “Birthing of Giants” program in 2010. When he’s not at the office you’ll find him officiating a college baseball game or regaling the merits of capitalism with a stranger at a local coffee house.  He can be reached by calling (512)-355-1499 or clicking here.

About Hire Better

At Hire Better, our mission is simple: provide high growth companies with high impact solutions for Hiring Confidently and Predictably.  Because after all, should recruiting your future employees really be something that is done faster and cheaper?

We achieve success by focusing on our 3 Core Values:

• BALANCE: Because our employees have balance in their lives they produce a better work product and results than any other company in the world of Talent Acquisition.
• TRUST: Trust is paramount to everything else.
• VALUE: Always add value. Always.

Our understanding of recruiting processes, networking and government compliance combined with insight into the online landscape and technical innovation drive real, quantifiable results.

*Geoff Smart & Randy Street released a little more user-friendly book entitled WHO in 2008. The quick and dirty version of their scorecard framework can be found on page 44.

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