Congratulations! You got funded! Your new product is a hit! You’re ready to grow!!! No problem. There are tons of resumes on the web-just help yourself, right? It’s free, right? And easy, right? Wrong!

First, start with time—everybody’s time. You have to find the resumes and screen them. Then you have to interview them—three, four, five, more? Oops, blew the in-house compensation curve because you offered an out-of-sync package and sign-on bonus? Whoops! Lost one to the competition because the process took too long?

Get the wrong person and you’ll yell for disaster assistance; get too picky and you’ll have late product releases, missed deadlines, or lost business opportunities. That’s why the average real cost of hiring one $60K IT professional starts around $75,000-and goes up. You may not even know the final figure for a year or more.

So, what do you do?

• Motivate! Tie incentives, whether cash or stock, to accomplishing company goals as opposed to individual ones. Used this way, incentives short-circuit negative feelings and politics—people ignore anything or anyone that gets in the way of their bonus—and that keep’s your people’s focus where it belongs.

How? If four developers are each working on a piece of code for the same project, tie the bonus for on-time completion to the whole project. That way, each of the developers has a vested interest in helping and motivating the other three.

• Prepare! Don’t staff by comparative shopping. Know before interviewing what you really need.

How? Take the time to write a really complete job req (requisition), including

• your culture—because the person has to match, or, at the very least, be synergistic, to it;
• management style—the type you have and/or the type you want;
• description of the job—a complete overview including all responsibilities;
• synergy—compliment the current team, don’t duplicate in-house expertise;
• likely interaction—both the intra- and inter-departmental interfaces;
• trade-offs—if you got X, would you give up Y;
• reality check—would you want the job when you were at that point in your career;
• experience—what “been there – done that” do you want or need; then
• Shrink it—our Minimum Hiring Rule states: “Hire the first person through the door who meets the minimum requirements for the position.”

How? Reduce the wish list to the absolute minimum in attitude/style/experience required to get the job done before you start interviewing; then stick to it. The person who has 150% of one minimum and 5% of another is not a fit; neither is the person everyone really likes, but who lacks half the minimums.

• Save time! Our 70% Rule: “Be 70% sure you want to hire the candidate and have the candidate 70% sure she wants to join, before the on-site interview.”

How? Have multiple, key people do full (1+ hour) interviews by phone, not quickie screenings, and do them conveniently (outside working hours), and fast (no more than a day between calls and preferably less). As long as you never invite a candidate on-site who doesn’t meet the minimum requirements, in most cases you will need only one on-site interview to make the hire.

• Sell, sell, sell! Know your culture, the job, the people, everything, and tell it like it is. Don’t fudge!

Why? The best way to guarantee a bad hire and low retention rate is to fudge about the company, job, career path, management style, future, people, hours, market, technology, etc. Fudging isn’t just outright lies, it includes omissions and spin. Why hire somebody who won’t stay? Money is about number five on most people’s “reasons to join” list, so know your culture and use it to your advantage—because the person who joins you for money will leave for money!

• Speed wins! The entire process, from seeing the résumé to candidate acceptance, should take no more than 10 working days, and fewer is better.

Why? Speed is the cheapest, simplest way to impress a candidate! Remember your own feelings when you couldn’t get a response? And that includes saying “no.”

To wrap-up, here are the main points to remember: Be fast, know what you need before interviewing, don’t lie, spin or fudge, constantly sell, and remember—the flip side of successful retention is good hiring.

Can you, as a start-up or small company, compete for people in today’s overheated labor market?

Absolutely!

Best of all, it won’t cost you more dollars or time—it actually saves on both—and significantly improves your retention rate. ,

To compete, you need to implement RampUp’s four basic hiring rules:

1. Complete Req Rule,
2. Minimum Hiring Rule,
3. 70% Rule, and
4. Five-to-Seven Rule

described, including real-life examples, below.

1. Complete Req Rule Too often managers “figure out” what they are looking for through interviewing trial and error. Writing a viable req provides you with better screened candidates to interview and helps you identify all the neat things you have to sell. Finally, to guarantee success (yours, the candidate’s, the team’s, and the company’s), remember: You are not hiring a skill-set suspended in time and space or a cyborg that can be reprogrammed if needs be; you are hiring a living, breathing human being with all the pluses and minuses that entails. Once you know the process involved in writing a good, i.e., fillable, req and adhere to it, you will find that the entire hiring process becomes easier and faster. Here’s what you need to know:

The 12 ingredients of a fillable req

Company culture — If you are not conscious of, or don’t understand in depth, your company’s culture, it will be difficult to use the information as a selling tool during the interview.

2. Management style — Whatever your management style, it is critical to accurately describe and discuss it with a candidate. If your style turns off that specific candidate, then you are ahead—you found out before hiring.

3. Job description — This is a comprehensive description of what the job entails

4. Responsibilities — This is a detailed explanation of what is required of the person in the position.

5. Team synergy — Knowing the strengths and weaknesses of the other people on the team allows you to define the new position in a way that will best complement and strengthen your team

6. Department interaction — People no longer work in a vacuum. You need to evaluate your department’s culture and be aware of the personal characteristics of your people.

7. Interdepartmental interaction — In today’s environment, no department can successfully function completely on its own; you must know how the interactions affect the position and to have agreement among all managers, direct and matrixed, as to the skills and personality needed.

8. Other managers/people to interview — For whatever reason these people are included, they must understand exactly what is in the req or they will be unable to contribute effectively to the project.

9. Trade-offs — There are trade-offs in any req and it is important to think them through ahead of time. The most fillable req is the one with the fewest absolutes.

10. Reality check — A good yardstick in assessing your req is whether you yourself would have wanted the job (making allowances for the difference between then and today) at the corresponding point in your own career.

11. Experience — The reason this is last on the list—instead of number one where most managers put it—is that knowing all of the prior information allows you to be both more specific about the experience needed as well as more creative about how to get it.

12. Minimum needs — The final and most crucial point, not only in the req but also in all of hiring: What are the absolute minimum requirements, from skills to personality, needed for the job? Boil down all your previous work and, since hiring should involve more than one interviewing manager, be sure that all of them are in agreement on the minimum acceptable experience and skill level for the position.

2. Minimum Hiring Rule: Hire the first person you interview who meets your minimum requirements. Short and to the point, there’s no hidden agenda and it’s not open to interpretation. It does require that you should put significant thought into number 12 of the req.

3. 70% Rule: You should be 70% sure that you want the candidate should be 70% sure that they want you before the first on-site interview happens.

To accomplish this it’s important to remember that interviewing doesn’t mean eyeball-to-eyeball. Your interviewing team can use in-depth phone interviews to make sure that you never invite candidates in to interview who don’t meet all your minimum hiring requirements—they won’t grow new skills between the time you set up the interview and the time it happens. If a critical interviewer is traveling, use additional phone interviews rather than lose the candidate by waiting.

The team had identified a potentially hot candidate but was unsure whether certain esoteric minimum skills wanted by the Joe, the CTO, were present. Bringing Katy in wouldn’t help because Joe was traveling; they couldn’t wait because she was interviewing with another company and due to get an offer. After explaining their concern to Katy they arranged an on-site interview for Thursday conditional on a phone interview with Joe Wednesday night. They the web to mimic Joe’s normal whiteboard interview style. The interview results were positive on both sides. By then the team was pretty sure they wanted her and Katy was so excited she brought her references with her on Thursday. The in-person interview confirmed what the team had felt—Katy was the right choice. By the end of Friday the references were checked, an offer was extended and it was accepted on the spot.

4. Five-to-Seven Rule: From first contact through resolution takes no more than five-to-seven business days (less is better).

Impressive doesn’t mean expensive. Speed is the most impressive action you can use to affect candidates’ decisions. People hate not knowing. They hate waiting. They hate bureaucracy. Create a hiring process in which all screening, interviewing (including multiple phone interviews), negotiating, reference checking, etc. gets done in five-to-seven working days and you will run rings around your competition.

Tracy had gone through three rounds of interviews when he read about a start-up that sounded interesting. He emailed his resume and was surprised when Jody, the CEO, called him back almost immediately and said they would like to interview him. Tracy was willing but leveled with Jody that he was due to get an offer from the other company that week so there wasn’t much time. Jody said fine and was he free to talk? Their conversation lasted about 40 minutes and Jody asked Tracy if he could talk to Kent, the engineering VP. Tracy said sure. Jody put him on hold, and a minute later Kent came on the line. That conversation lasted 30 minutes, and Kent asked if Tracey still had time. Fascinated, Tracey said yes. Over the next hour and a half Tracey talked to the team leader and two other engineers, then he was transferred back to Jody. She asked him if he could interview that evening around six and would he mind sending his references immediately. Still more amazed Tracey said he would be there and set the email. That evening Tracey interviewed with two other managers as well as all the people he had talked with earlier, then found himself back in Jody’s office. He waited nearly 10 minutes before Jody came back. She apologized but said she had wanted to get feedback from the others before seeing him. Based on the feedback she had gotten after the phone interviews Jody had already checked his references and now everybody had confirmed that they wanted him so she would like to work out an acceptable offer before he left if he didn’t mind staying a little longer. The offer was cut and Tracey accepted on the spot, saying that any company that could move that fast was where he wanted to be.

Staffing is a science—just like engineering—that can be learned. When competing head-to-head for people in any labor market, let alone a hot one, you need to use every advantage possible. Many managers see staffing as a chore and perform it grudgingly. By treating it as a chance to shine—taking time to think through your reqs, streamlining your hiring process and becoming a speed demon—you create an environment that attracts the best people at all levels.

Business is booming, companies are growing and managers are hiring. Hiring proficiency is learned, not something people are born knowing how to do. To help you through it I decided to share RampUp’s eight “drop dead” points (AKA, “If you learn nothing else…”) that we teach our clients.

1. As a manager, you are who you hire—your career success and compensation depends on hiring well!
2. People are intelligent, motivated, and once hired, really do want to help their company achieve its objectives.
3. Involving employees in the hiring process lightens the load, reduces the blunders, and strengthens your people.
4. Follow the Minimum Hiring Rule: Hire the first person that walks through the door who meets your minimum requirements. To do this, you must know and have internal agreement on both the position and its minimum requirements before you talk to even one candidate.
5. The first step in efficient hiring is knowing how to read a resume.
6. Using phone interviews as “real interviews” lets you implement the 70% Rule—you should be 70% sure that you want to hire the candidate and the candidate should be 70% sure she’s interested in you/company/position before arranging an in-person interview—and decreases the number of on-site interviews needed per hire. You will experience a quantum leap in hiring productivity, saving time and money.
7. Response speed—to the resume, interviews, the offer—is one of the least expensive and greatest edges a manager has.
8. Your company has many assets besides money to attract candidates. You must know what they are and believe in them in order to sell them to potential employees—because people who join just for money will leave for more money.

Implementing any one of these points will boost your hiring productivity at least 10%, some will boost it more. Implement them all and you’ll blow away the competition.

A Friday series exploring Startups and the people who make them go. Read all If the Shoe Fits posts here.

If I have to listen/read one more time about value/importance/etc of hiring “stars” or the “best” whatever I think I may scream. Or, better yet, shove the words/premise down the appropriate throat.

While I, and a small minority, have tried to debunk this mindset we haven’t made much progress.

So here’s an article from Scott E Page, the Leonid Hurwicz collegiate professor of complex systems, political science and economics at the University of Michigan, Ann Arbor.

Perhaps you’ll pay attention to him.

Why hiring the ‘best’ people produces the least creative results

While in graduate school in mathematics at the University of Wisconsin-Madison, I took a logic course from David Griffeath. The class was fun. Griffeath brought a playfulness and openness to problems. Much to my delight, about a decade later, I ran into him at a conference on traffic models. During a presentation on computational models of traffic jams, his hand went up. I wondered what Griffeath – a mathematical logician – would have to say about traffic jams. He did not disappoint. Without even a hint of excitement in his voice, he said: ‘If you are modelling a traffic jam, you should just keep track of the non-cars.’

The collective response followed the familiar pattern when someone drops an unexpected, but once stated, obvious idea: a puzzled silence, giving way to a roomful of nodding heads and smiles. Nothing else needed to be said.

Griffeath had made a brilliant observation. During a traffic jam, most of the spaces on the road are filled with cars. Modelling each car takes up an enormous amount of memory. Keeping track of the empty spaces instead would use less memory – in fact almost none. Furthermore, the dynamics of the non-cars might be more amenable to analysis.

Versions of this story occur routinely at academic conferences, in research laboratories or policy meetings, within design groups, and in strategic brainstorming sessions. They share three characteristics. First, the problems are complex: they concern high-dimensional contexts that are difficult to explain, engineer, evolve or predict. Second, the breakthrough ideas do not arise by magic, nor are they constructed anew from whole cloth. They take an existing idea, insight, trick or rule, and apply it in a novel way, or they combine ideas – like Apple’s breakthrough repurposing of the touchscreen technology. In Griffeath’s case, he applied a concept from information theory: minimum description length. Fewer words are required to say ‘No-L’ than to list ‘ABCDEFGHIJKMNOPQRSTUVWXYZ’. I should add that these new ideas typically produce modest gains. But, collectively, they can have large effects. Progress occurs as much through sequences of small steps as through giant leaps.

Third, these ideas are birthed in group settings. One person presents her perspective on a problem, describes an approach to finding a solution or identifies a sticking point, and a second person makes a suggestion or knows a workaround. The late computer scientist John Holland commonly asked: ‘Have you thought about this as a Markov process, with a set of states and transition between those states?’ That query would force the presenter to define states. That simple act would often lead to an insight.

The burgeoning of teams – most academic research is now done in teams, as is most investing and even most songwriting (at least for the good songs) – tracks the growing complexity of our world. We used to build roads from A to B. Now we construct transportation infrastructure with environmental, social, economic and political impacts.

The complexity of modern problems often precludes any one person from fully understanding them. Factors contributing to rising obesity levels, for example, include transportation systems and infrastructure, media, convenience foods, changing social norms, human biology and psychological factors. Designing an aircraft carrier, to take another example, requires knowledge of nuclear engineering, naval architecture, metallurgy, hydrodynamics, information systems, military protocols, the exercise of modern warfare and, given the long building time, the ability to predict trends in weapon systems.

The multidimensional or layered character of complex problems also undermines the principle of meritocracy: the idea that the ‘best person’ should be hired. There is no best person. When putting together an oncological research team, a biotech company such as Gilead or Genentech would not construct a multiple-choice test and hire the top scorers, or hire people whose resumes score highest according to some performance criteria. Instead, they would seek diversity. They would build a team of people who bring diverse knowledge bases, tools and analytic skills. That team would more likely than not include mathematicians (though not logicians such as Griffeath). And the mathematicians would likely study dynamical systems and differential equations.

Believers in a meritocracy might grant that teams ought to be diverse but then argue that meritocratic principles should apply within each category. Thus the team should consist of the ‘best’ mathematicians, the ‘best’ oncologists, and the ‘best’ biostatisticians from within the pool.

That position suffers from a similar flaw. Even with a knowledge domain, no test or criteria applied to individuals will produce the best team. Each of these domains possesses such depth and breadth, that no test can exist. Consider the field of neuroscience. Upwards of 50,000 papers were published last year covering various techniques, domains of enquiry and levels of analysis, ranging from molecules and synapses up through networks of neurons. Given that complexity, any attempt to rank a collection of neuroscientists from best to worst, as if they were competitors in the 50-metre butterfly, must fail. What could be true is that given a specific task and the composition of a particular team, one scientist would be more likely to contribute than another. Optimal hiring depends on context. Optimal teams will be diverse.

Evidence for this claim can be seen in the way that papers and patents that combine diverse ideas tend to rank as high-impact. It can also be found in the structure of the so-called random decision forest, a state-of-the-art machine-learning algorithm. Random forests consist of ensembles of decision trees. If classifying pictures, each tree makes a vote: is that a picture of a fox or a dog? A weighted majority rules. Random forests can serve many ends. They can identify bank fraud and diseases, recommend ceiling fans and predict online dating behaviour.

When building a forest, you do not select the best trees as they tend to make similar classifications. You want diversity. Programmers achieve that diversity by training each tree on different data, a technique known as bagging. They also boost the forest ‘cognitively’ by training trees on the hardest cases – those that the current forest gets wrong. This ensures even more diversity and accurate forests.

Yet the fallacy of meritocracy persists. Corporations, non-profits, governments, universities and even preschools test, score and hire the ‘best’. This all but guarantees not creating the best team. Ranking people by common criteria produces homogeneity. And when biases creep in, it results in people who look like those making the decisions. That’s not likely to lead to breakthroughs. As Astro Teller, CEO of X, the ‘moonshoot factory’ at Alphabet, Google’s parent company, has said: ‘Having people who have different mental perspectives is what’s important. If you want to explore things you haven’t explored, having people who look just like you and think just like you is not the best way.’ We must see the forest.

Scott E Page

This article was originally published at Aeon and has been republished under Creative Commons.

Image credit: HikingArtist

The hourly base wage for fast-food workers in Denmark is $20USD, yet McDonald’s, Burger King, etc., are still profitable.

Try to sell a minimum wage increase to just $15 and you’ll be told that it would destroy jobs and close businesses.

But, as the song goes, it ain’t necessarily so.

Despite starting out with just a $35,000 investment in 1978, The Container Store founder and CEO Kip Tindell has grown his business to one that has 67 US locations and rings up annual sales of nearly $800 million.

Equally impressive is the fact that he’s done all that while paying his retail employees nearly twice the industry average.

So what does Tindell know that other bosses of retail businesses don’t? You get what you pay for…

• “The 1=3 rule,” i.e., one great employee is as productive as three OK employees, so he gets three times the productivity of an average worker at only two times the cost.
• Turnover is lower substantially reducing hiring and training costs.
• Annual raises up to 8% of their salaries, based on performance, but
• encourages managers to evaluate employees based on their value to the company.

The result is the average Container Store retail salesperson makes nearly $50,000; about double the national average for retail.

When it comes to wages, Kip Tindell is the Twenty-first Century’s Henry Ford.

Ford astonished the world in 1914 by offering a $5 per day wage ($110 today), which more than doubled the rate of most of his workers. (…) The move proved extremely profitable…

The minimum wage war should become a lot more interesting when Tindell takes over as chair of the National Retail Federation.

It’s a lot harder to argue with success.

Flickr image credit: Tomer Gabel