Looks can be deceiving. Even first impressions. This is especially true when it comes to A-players.
But it’s often these differences that make them worth a million bucks each and deliver an ROI of 500%.
For background, we’re now working with the CFO Leadership Council figuring out how to calculate the financial impact of hiring A-players who are non-revenue generating staff professionals. In one of our models, shown in the graphic, it turns out that for every $100,000 in base salary, hiring an A-player—someone in the top 25% of their peer group—can result in a $600,000 to $700,000 net pre-tax profit improvement over just three years. With most professional staff earning over $100,000 annually, the actual impact typically exceeds $1 million per hire.
Moneyball for HR! Spotting the A vs. D Differences
Despite the impact, the A-players are often hard to spot during an interview. These clues will help:
A-players are more motivated, more competent, stronger team players, more reliable, they volunteer more often, are assigned the most difficult and important projects, they need less direction, they get promoted more often, and they coach, mentor and motivate others. And best of all, they continue to do all this every year for at least 3-4 years.
But sometimes the A-players just don’t fit the A-team image when you first meet them. Sometimes they look different, or sound funny, or are too quiet, or are too old, or too young, or not prepared enough, or not as experienced enough or maybe too experienced. Worse, they’re sometimes late for the interview or ask too many hard questions. Or the hiring manager contends, “They just don’t fit.”
It turns out it’s these differences that makes them A-players, but our HR tech systems often filter them out or the people interviewing them do because they are not traditional enough.
Avoid Hiring the D-Team Since They Look More Traditional
Now consider the flip side. These are the hiring mistakes that cost you the $1 million you thought you had in the bank. This is the D-team. These people are less competent, less motivated, make too many excuses, require more direction to produce average work, they turn over more often, they’re less reliable, they’re assigned the less important work, and they demotivate everyone they work with.
But sometimes these people get hired since they have a more traditional background, and they look and sound just like you hoped. This is even more likely when you’re hungry to fill the role. They’re often affable and outgoing during the interview. They’re seemingly motivated and prepared and they give you all of the right answers to your behavioral questions with little prompting. They’re somewhat competent, too. Unfortunately they fall short once on the job.
“Moneyball for HR!” can help you spot the differences.
Playing “Moneyball for HR” starts by learning how to make multi-year, million-dollar investment decisions in your company’s future, the hiring manager’s future, and the candidate’s future. This formula will help get you started.
Use the Hiring Formula for Success to Calculate the ROI of Hiring the A-player.
The “n” in the Hiring Formula for Success is the most important factor predicting if a person will be on the A, B, C or D team. To make the A-Team cut it “n” needs to be 2 or more.
For background, the formula was developed by tracking the performance of hundreds of people and understanding how well the interview predicted their on-the-job performance. It turns out that the ability factors are relatively easy to assess during the interview. What’s hard is measuring the fit factors. But these are the most important since they’re the ones that determine intrinsic motivation to do the actual work you need done.
When the fit factors are in alignment motivation soars and when they don’t motivation falls flat.
Use the interview to collect the evidence needed to make the hiring decision, not to make the hiring decision.
Playing “Moneyball for HR!” starts by being objective and gathering the evidence to determine each of the factors in the Hiring Formula for Success. Here are the quick instructions:
- Ignore the person’s first impression good or bad. (Here are some tips for this.)
- Wait 30 minutes after the interview starts before you even think about making a yes/no hiring decision. FYI, this is the hardest part of the interview. See step 6. The idea here is to use the interview to collect the evidence needed to make the hiring decision, not to make the hiring decision.
- Conduct a work history review looking for all of the A-player clues noted above.
- If you find at least six clues the person might be an A-player, ask the person to describe their most important career accomplishment of all time.
- Compare the candidate’s major accomplishment to the major performance objective of the open role. Using a performance-based job description is an essential part of the assessment process.
- If there’s a reasonable fit on a scope and scale basis and the fit factors seem to be in alignment, measure the candidate’s first impression at the end of the interview using this benchmark, “How will the candidate’s first impression impact their ability to handle the job?” Caution: you can only make this determination at the end of the interview when you’re not affected by the person’s first impression.
That’s all there is to know if the candidate is a potential A-player for the open role. But you’ll need to gather more evidence for each of the factors in the Hiring Formula to prove it.
It’s worth a million bucks.
