Framework for the Course MGMT 4020 Hiring and Retaining Human Resources

Major Themes of Books Talent Flow –Performance yield-> Performance problems are inevitable –Flow and change is also inevitable –Job Satisfaction is a key driver of talent flow High-Impact Hiring –The state of practice in hiring lags behind the state of the art –Effective hiring is systematic, comprehensive and performance-focused; an investment, not a cost –Avoiding problem employees is as critical as hiring effective employees (and yet different) “Evidence-Based Management”

Perf Yield – Typical Interview

Perf Yield – “Good” System

Why is Performance Yield so Low? Difficulty of job Limitations of hiring system –How selective you are –Accuracy (validity) of hiring toolsvalidity Bad decisions by applicant Changes in employee after hiring

Factors Affecting Hiring Success Difficulty of Job

Successful Employees Unsuccessful Employees Base rate of success = 9/18, or 50%

Base rate of success = 14/18, or 78% Unsuccessful Employees Successful Employees

Factors Affecting Hiring Success Selection Ratio (How selective you can be)

True Positives False PositivesTrue Negatives False Negatives Success rate = 8/12, or 67%

True Positives False PositivesTrue Negatives False Negatives Success rate = 8/12, or 67% Success rate = 5/6, or 80%

Factors Affecting Hiring Success Validity of Hiring System (r =.83 vs.63)

Success rate = 73% (vs 67%) (and no False Negatives) r =.83 (vs. 67) False NegativesTrue Positives True NegativesFalse Positives

Success rate = 73% (vs 67%) Success rate = 100% (vs 80%) False Negatives True Positives True NegativesFalse Positives

So What Can You Do? Increasing Yield –Simplify job –Recruit more/better candidates –Use more valid hiring procedures –Help applicants make better decisions (RJPs) Coping with “Failures” –Training –Placement may be as important as selection –Over-hiring (continuous hiring) –Remove hiring mistakes –?–?

Performance Yield over Time

Post-Hire Changes in Performance Relative rates of change in performance –From positive to negative –From negative to positive Relative rates of exit of high and low performers More common! Turnover generally higher among better performers! WHY?

Study of Hiring Managers What’s the “secret” to successful hiring?

Summary: Why Hiring Failed Inadequate Process:50% Inadequate Applicants:14% Pressure to Hire Wrong Person:13% Limitations of Interviewer:12% Fooled by Applicant:11% Didn’t Explain Job: 3%

Why Hiring Failed Inadequate Process (50%) Interviews:15% Reference-checking:13% Not enough time: 7% Wrong qualifications: 7% Not selective enough: 4%

Evidence-Based Practice Evidence-based medicine is a methodology for evaluating the validity of research in clinical medicine and applying the results to the care of individual patients. Evidence is gathered through systematic review of the literature, and is critically appraised. The results are then integrated with physician/patient decision making.

Evidence-Based Practice & Project Develop a focused clinical question concerning the patient's problem(s) Search secondary databases and the primary literature for relevant articles Assess the validity and usefulness of those articles Judge the relevance to the individual patient Implement the findings in patient care

Why Performance Problems? Hiring Issues –Limitations of hiring system Difficulty of job  not much you can do How selective you are  Recruitment Accuracy (validity)  much can be done Bad decisions by applicant  RJPs? Obsolescence of skills –  Hire for ability; training Changes in employee behavior –  reduce job dissatisfaction; encourage constructive problem-solving

Three Models of Hiring Warm-Body Hiring Ritual Hiring High-Impact Hiring

High Impact Hiring Principles Systematic Comprehensive Performance-oriented –does it deliver better job performance?

Steps to High Impact Hiring Understanding job performance Anticipating hiring needs Recruiting high potential applicants Comprehensive evaluation of applicants Performance-based decision-making