Competing on Talent in Today’s Business World: A Blueprint for New Ways of Hiring 144389575X, 9781443895750

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Competing on Talent in Today’s Business World: A Blueprint for New Ways of Hiring
 144389575X, 9781443895750

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Competing on Talent in Today’s Business World

Competing on Talent in Today’s Business World: A Blueprint for New Ways of Hiring By

Pradeep Sahay

Competing on Talent in Today’s Business World: A Blueprint for New Ways of Hiring By Pradeep Sahay This book first published 2017 Cambridge Scholars Publishing Lady Stephenson Library, Newcastle upon Tyne, NE6 2PA, UK British Library Cataloguing in Publication Data A catalogue record for this book is available from the British Library Copyright © 2017 by Pradeep Sahay All rights for this book reserved. No part of this book may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the copyright owner. ISBN (10): 1-4438-9575-X ISBN (13): 978-1-4438-9575-0

The Art & Science of Hiring should be working together…making love. That’s how it works best.

TABLE OF CONTENTS DISCLAIMER

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FOREWORD

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EXECUTIVE SUMMARY

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PART I: A NOTE ON THE QUEST FOR EXCELLENCE IN HIRING 1 A PASSION FOR EXCELLENCE AT WORK 2 THE RIGHT HIRING MAKES ALL THE DIFFERENCE 3 WHY HIRING GOES WRONG SO OFTEN? 4 THE 11 DEADLY HIRING TRAPS 5 BEYOND THE ROMANCE OF THE GUT 6 BLENDING THE ART & SCIENCE OF HIRING

1 2 9 13 18 25 32

PART II: THE COMPLEXITY OF TALENT 7 THE ETYMOLOGICAL HISTORY OF THE TERM “TALENT” 7.1 Talent: Is it Nature or Nurture? – Object Approach 7.1.1 TALENT AS A NATURAL ABILITY 7.1.2 TALENT AS MASTERY 7.2 Talent as People – Subject Approach

39 40 42 43 45 48

PART III: THE CHANGING TALENT LANDSCAPE 8 THE NEW TALENT ECONOMY: A MACRO VIEW 9 TWENTY-FIRST CENTURY RECRUITING: FROM TRANSACTION TO TRANSFORMATION 9.1 Talent Spotting 9.1.1 THE TALE OF THE PERFECT AND THE JAGGED RESUME 9.2 Assessment Science 9.3 The Promise and the Challenge of Big Data 9.4 Data-Driven Recruitment 9.5 The Digitalization of Recruitment 9.6 The Internet of Things (IoT) 10 RECRUITING REVISITED – THE NEW RECRUITMENTMODELS

55 56

PART IV: COMPETING ON TALENT – SIGMA GROUP 11 DEVELOPING A LONG-TERM PERSPECTIVE 12 TALENT ACQUISITION AT SIGMA GROUP: A HISTORICAL PERSPECTIVE 13 A STRATEGIC FRAMEWORK FOR TALENT ACQUISITION AT SIGMA GROUP

64 67 68 75 78 80 83 86 90 95 96 100 105

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13.1 Employer Brand 13.2 Structure 13.3 Process & Technology 13.4 Metrics & Measurement 13.5 Strategy 14 BENCHMARKING FOR SUCCESS

109 116 119 135 139 145

PART V: ROAD-MAP FOR STRATEGY DELIVERY 15 TALENT ACQUISITION COE: LAYING THE FOUNDATION 16 THE LEADERSHIP AND CULTURE IMPERATIVE AT SIGMA GROUP 17 BUILDING THE TALENT ACQUISITION COE STRUCTURE 18 THE KEY RECRUITING TRANSFORMATION STAGES: SIGMA GROUP 18.1 Phase I 18.2 Phase II 18.3 Phase III 18.4 The Final Phase

153 154 159 165 169 170 174 174 175

PART VI: VALUE CREATION THROUGH OPTIMIZATION 19 TALENT ACQUISITION AT SIGMA GROUP – THE NEW PERSPECTIVE 19.1 Best Practices – Recruiting Department Structure 19.2 Best Practices – Recruiting Process Components 19.3 Best Practices – Workforce Planning Process 19.4 Best Practices – Metrics & Measurements 19.5 Best Practices – Pre-Hire Assessments 19.6 Best Practices – Technology 20 RESULTS PRODUCED BY THE RECRUITING TEAM AT SIGMA 21 GOING GLOBAL: LOCALIZATION OF TALENT ACQUISITION STRATEGY

179 180 185 193 203 209 214 220 224 231

EPILOGUE REFERENCES GLOSSARY READING LIST ABOUT THE AUTHOR WHAT PEOPLE HAVE SAID ABOUT PRADEEP SAHAY ACKNOWLEDGEMENTS

234 249 254 264 266 267 269

DISCLAIMER

The author and publisher of this Book and the accompanying materials have used their best efforts in preparing this Book. The author and publisher make no representations or warranties with respect to the accuracy, applicability, fitness or completeness of the contents in this Book. The Information contained in this Book is strictly for education purposes. The author and the publisher disclaim any warranties (expressed or implied), merchantability, or fitness for any particular purpose. The author and publisher shall in no event be held liable to any party for any direct, indirect, punitive, special, incidental or other consequential damages arising directly or indirectly from any use of this material, which is provided “as is”, and without warranties. The author and publisher do not warrant performance, effectiveness or applicability of any sites listed or linked in this Book. This Book is copyrighted by Pradeep Sahay and is protected under the copyright, Designs & Patents Act, 1988 and all other applicable laws, with all rights reserved. No part of this Book may be copied, or changed in any format, sold, or used in any other way than what is outlined in this Book under any circumstances without express permission from Pradeep Sahay.

FOREWORD

Today’s most competitive marketplace isn’t technology but talent and a strategic approach to talent acquisition (TA) will be even more crucial as markets continue to grow and change the dynamics of competition. New challenges are emerging that lessen the relevance and value of current managerial experience and knowledge. The talent that led to today’s success will no longer be enough to lead organizations in the new competitive landscapes that are emerging. In the larger context of how organizations are evolving their talent strategies, this book on talent acquisition by Pradeep is par for the course. It is a welcome and timely source of knowledge and practical advice for staffing leaders and recruiters, who need to embrace the changing scope of TA work. The text brings together, in a comprehensive manner, various frameworks of thought and action that help in identifying priority areas of growth and development in TA. This approach allows us to address the real issue of cross-functional collaboration in TA. The book explores the key elements inherent in the art and the science in recruiting that must come together to execute a positive shaping talent strategy. What makes this book practical and useful is by the example of a real-world business situation, where an organization examines how to develop its strategy using a pragmatic migration path that builds capability rapidly. The field applications of various frameworks give life to the ideas presented and show the manager how these ideas actually work in practice. Organizations looking to up the ante as they compete on talent in a VUCA environment will find the well-grounded practical insights of immense value in creating their own “Blue Ocean Recruiting” models. An engaging read, Pradeep’s book shows how talent acquisition can be a competitive advantage because of his deep experience and competence in this field, combined with his continuing willingness to listen and learn from others. I am sure Pradeep will continue to make a significant impact in the organizations and talents he encounters. Jacinto C. Gavino, DPA Washington SyCip Graduate School of Business AIM-Manila, Core Faculty

EXECUTIVE SUMMARY

“Uncertainty is an uncomfortable position. But certainty is an absurd one.” – Voltaire

We live in an era of profound and accelerating change keynoted by what historian Carlota Perez calls a new “techno-economic” paradigm. In her book, Technological Revolutions and Financial Capital, she presents a novel interpretation of the mysterious economic oscillations of the past few years and how constant transformation is the new normal today. Tectonic market shifts are transforming the global business landscape. Economic realignment, advances in technology, the globalization of markets, changing demographic trends, new customer needs and increased competition are radically altering how companies operate in virtually every industry and region of the world. Evidence of this new world order can be seen in the trade numbers. In 1990, the total of the world’s exports and imports accounted for only 30 percent of the world’s GDP – today, they make up more than half. 1 Buffeted by these rapid and disruptive changes, every organization would love to build a business model that describes everything about its markets, customers and competition and from that model build the perfect strategy for the future. Unfortunately, that doesn’t work, and it never will. The future is characterized by VUCA: Volatility, Uncertainty, Complexity, and Ambiguity. This VUCA environment creates ever-shifting eddies that reshape many parts of the global economy, making equilibrium a distant memory; in this turbulent business environment, the notions of long-term strategy and enduring competitive advantage seem like quaint anachronisms, part of the detritus of the 1980s and 1990s. These structural shifts are reshaping both the supply and demand for talent across the globe. To cope with the changing business environment, employers are demanding new skills from their employees, yet often find that they are in short supply. The paradox is profound: on the one hand, 40 million workers in the industrialized world are unemployed, according to recent estimates by the International Labour Organization. Yet executives and managers tasked with hiring new workers often say they are unable to find the right people with the proper skills to fill their vacancies. 1

Oxford Economics: Global Talent 2021 Survey Report.

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Executive Summary

This is an environment that defies confident diagnosis and befuddles executives. No wonder, leaders at Sigma Group (a fictitious name of a real company) felt a sense of deepening stress as they surveyed the mutating business landscape. It was circa 2012, and Sigma Group, a diversified US $2 billion infrastructure conglomerate, found itself at the cusp of these disruptive forces. Increased competition, a rapidly shifting regulatory environment, and new business models in emerging markets were unleashing a wave of unprecedented challenges for the group. The underlying theme: Future success would require not just doing things better, but mastering the ability to do them differently. The era of disciplined expansion and growth was on the wane. Business transformation and the new geography of talent would call for a fresh approach and mindset for attracting and retaining quality talent. While this was one side of the coin, the other side held out great promise for Sigma – an abundance of opportunities, which if leveraged well could catapult the group to a US $5 billion entity by 2017. Aggressively pivoting its businesses to more sustainable and innovative ways of operating required that the very best talent be sourced, engaged, developed, and retained. Having a great model was hard enough; finding outstanding talent to execute it was even more challenging, particularly, in the markets where the group operated. The top leadership was unanimous in its thinking that putting the right talent in the right roles at the right time would be the key differentiator that would keep the group out in the front, ahead of its rivals. Since 2008, Sigma had focused on increasing its profitability and the leadership in the organization believed that this could be achieved better through integration of all the functions. Although, its revenues had been growing, its profitability lagged behind its peers in the industry. With employee costs contributing to over 65 percent of the operating expenses, this necessitated a review of the entire spectrum of the talent management operations. Critical to this was the re-evaluation of the entire talent acquisition function, which between the years 2008–2011 was responsible for hiring over 80 percent of its present employee count of 10,000. There had been good recognition and applause for Sigma’s talent acquisition initiatives from the community of peers in the TA functions and Heads of HR of different organizations across India. Key stakeholders were understandably proud of what the TA group had achieved over the past three years. However, the new organizational context demanded a reality check, whether the achievements were truly representative of a strategic function in alignment with the business goals of Sigma. The leadership at Sigma reflected that to be strategic, the talent acquisition function must put time and energy into things that would make

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the organization “significantly different” or “measurably better” than competitors – “In a sense optimize the function to boost its strategic impact because in the end talent is what is going to make or break us.” This backdrop, formed by the vagaries of the economic scene on the one hand and the plenitude of marketplace opportunity on the other, qualified a need to re-orient the focus of the group’s talent acquisition outlook from a tactical, reactive process to a strategic program capable of consistently sourcing, recruiting and on-boarding the best talent. If “strategy” is defined as the art of creating an unfair advantage – a gun in a knife fight – it is clear that organizations, which creatively create, configure and catalyze their talent acquisition approach will create an advantage that is hard to replicate. The Strategy Palette The essence of strategy is choosing to perform activities differently than rivals do and the best approach depends upon the specific problem at hand. Author Martin Reeves in his book, Your Strategy Needs a Strategy, convincingly argues that an organization’s business environment dictates its approach to strategy. You need to assess the environment and then match and apply the appropriate approach. These approaches to strategy formulation – refer to exhibit below – fall into four buckets, according to how predictable an industry’s environment is and how easily companies can change their environment.

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Executive Summary

The above framework served as a ready template for leaders at Sigma and enabled a clear understanding of the strategic styles available and the conditions under which each is appropriate. It provided valuable insights on the differing economic conditions, under which some of its businesses were operating for e.g., Engineering and Construction vis-à-vis Power and Pharmaceuticals. The scenario required managing more than one strategic style at a time and influenced the hiring process rubrics of Sigma group. It helped them do what the most successful were already doing – deploying their unique capabilities and resources to better capture the available opportunities. Capability Optimization “There is a time to sow and a time to reap.” – Ecclesiastes

Organizations typically create capabilities through utilization of resources at multiple levels. A key fundamental here is to rethink how these resources are deployed and how they can be made to yield maximum value. This optimization is about ensuring effective and efficient deployment of existing and new resources for capability maximization and is the result of the interplay between utilization, efficiency, and effectiveness. The exhibit(s) below portray this linkage as also the key triggers towards creating an optimized talent acquisition function at Sigma:

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The central challenge here for Sigma was to identify, synthesize, and integrate dispersed capabilities both within its talent acquisition function and its larger organizational context. This required understanding and managing the continuity-change continuum2: “the organizational capacity both to exploit and explore.” It was a litmus test of sorts for Sigma’s ability to gain operating efficiencies on the one hand, and adapt and maintain currency with a changing business climate on the other. Most change interventions begin with a fundamentally flawed assumption: that all parties involved in the change share an overwhelming common interest.3 Power dynamics, contextual considerations, and resistance to change are underestimated and even considered anomalous.4 As a result, no one mentions “many of the emotional and political issues that frequently preoccupy real people in real organizations” during times of change.5 And after all, organizational change means changing human behaviour, notwithstanding little evidence suggesting that behaviour can be pliable or predictable.6 2

Gratez F. and Smith A.C.T., “Managing Organizational Change – A Philosophies of Change Approach,” Journal of Change Management, vol. 10, no. 2(2010), pp. 135–154. 3 Collinson D. and Tourish D., “Teaching leadership critically: New directions for leadership pedagogy,” Academy of Management Learning & Education, vol. 14, no. 4 (2015):, pp. 576–94. 4 Ford J.D., Ford L.W., and D’Amelio A., “Resistance to change: The rest of the story,” Academy of Management Review, vol. 33 (2008), pp. 362–77. 5 Argyris and Schon, Organizational Learning. 6 Grey C., A Very Short, Fairly Interesting and Reasonably Cheap Book About Studying Organizations (London: Sage, 2013).

xvi

Executive Summary

Psychology research suggests that our beliefs, attitudes, and social norms often influence our willingness to change, regardless of whether they conflict with the single-minded ideal of maximizing our utility.7 For Sigma, this meant engaging with an approach that spoke directly to the human needs and experiences of end-users of its recruiting services. Design Thinking offered a positive way of exploring the opportunity for change. A more positive view of looking at the future, the essence of which was captured succinctly by a senior stakeholder at Sigma: “Our journey to transform the way we hired talent started with an intention, a desire, and a need towards a better situation or state. We had no way of knowing whether this was a practical and viable path to take. Design Thinking gave us the tools to explore What Could Be.” Sigma’s optimization effort, thus, in many ways was rooted in design thinking principles. The approach was about making the customer the focal point in the design of its hiring strategy and evolve the processes – take insights from people at the various touch-points of the process and build from the outside-in rather than the inside-out. It enabled the stakeholders to boil the strategic elements down to their foundational aspects and from there chart a fundamentally different vector for the optimization journey. The Leadership Imperative Key avenues of optimization can be explored and unlocked only with extraordinary leadership commitment. Leaders who apply optimization effectively build an “optimization culture” that goes beyond the traditional management imperatives of improving quality, reducing cost, and decreasing customer-response times. Such a culture puts highest value on staking out the best solutions to strategic and operational challenges.8 But doing this successfully requires questioning long-held assumptions in the ways most organizations still operate today by investing to change the mindset of people. The flip side is that leaders in organizations must also be on guard against the chorus of divergent views as it can obscure the need to question long-held assumptions. Leaders at Sigma were aware that the optimization approach would require letting go of those assumptions and bring a “fresh pair of eyes look at the business of recruiting.” It would require a deviation from a dominant

7

Fishbein M., “A theory of reasoned action: Some applications and implications,” Nebraska Symposium on Motivation, vol. 27 (1979), pp. 65–116. 8 http://www.amazon.in/The-Optimization-Edge-Reinventing-Decision/dp/ 0071746579

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set of embedded norms and behaviours and this shift would impact the inner workings of individuals and the teams, functions, and the organization at large. A senior stakeholder at Sigma captured the essence of this challenge in his powerful sentiment: “There are ideas that all of us are enthralled to which we simply take for granted as the natural order of things, the way things are. And many of our ideas have been formed, not to meet the circumstances of the present but to cope with the circumstances of the past. But our minds are still hypnotized by them, and we have to disenthrall ourselves of some of them.” Now, doing this is easier said than done. Considering the inertia of old processes and structures, the strain of implementing an optimization effort can hardly we overestimated. The leadership imperatives, to usher in this new order, cannot be overemphasized upon. We shall examine this in more detail in Chapter 15 of the book. The schematic below illustrates the key avenues of optimization explored and leveraged at Sigma. At its core, this was centred on the key dimensions of organization framework which included structure, culture integration, employment brand, leadership participation, workforce planning, and internal consistency measures.

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Executive Summary

A cross-pollination of ideas from a wealth of disciplines and best practices of high impact business functions served as a beacon and helped sculpt the core of the optimization effort. It was like building with Lego blocks: efficient use of existing knowledge while applying the acquired skills to construct something new. The more of these building blocks we have, and the more diverse their shapes and colours, the more interesting our creations will become. Because if we have only one colour and one shape, it greatly limits how much we can create, even within our one area of expertise. Above all, it was about how these different disciplines illuminated one another to glean some insight, directly or indirectly, into that elusive question of how to hire, and how to hire well. The exhibit(s) below detail the prominent interventions in this transformation from a transactional model to a business process model. Key Interventions Change Management

Competing on Talent in Today’s Business World

Recruitment Process Mapping – Lean Manufacturing Principles

Adapting from High Impact Business Functions

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Executive Summary

These interventions presented an interesting mélange of actionable evidencebased insights and uncovered key organizational challenges, which were then synthesized and integrated to shape the contours of Sigma group’s future recruiting outlook and its ability to influence long-term corporate performance. This was design thinking working at its best: reconsidering the ways hiring meets the end user’s unspoken needs, as well as reworking the infrastructure that enables the product – the right hire – and the supply chain – the process – that delivers it. Flow of the Book The Book chronicles the journey of a leading infrastructure group in India as it sets out to articulate its talent agenda in response to the opportunities and challenges offered by a fast-changing business environment. In its ability to create innovative recruiting efficiencies and a hiring rubric aligned around organization values, Sigma group was able to push the boundaries of what can be and should be a strategic talent acquisition and how it was used as a core of the company’s competitive advantage. Every journey begins with questions, and the strategic importance of talent acquisition can be appreciated better with an understanding of talent as an underlying construct. Does “talent” refer to people (subject) or the characteristics of people (object)? Is “talent” a natural ability or does it relate more to mastery through practice? This lack of construct clarity can diffuse the best-recruiting efforts of an organization leading to a suboptimal function. We’ll set the scene in Part I and explore why the art and science must come together to illuminate the hiring discipline. This part examines the many factors that cause hiring to go wrong, from our senses to our higher cognitive processes to our social conventions. In Part II, I move from why we get hiring wrong to why an understanding of the underlying “talent” construct is critical to effective hiring. This part offers a discussion of the etymology of the term “talent” and its linguistic evolution over time, with the purpose of shedding light on contemporary usage of the term in organizational settings. The chapter(s) delve into the different approaches to conceptualization of talent within the world of work and its implications for talent acquisition in practice. Part III provides a macro view on the shifting nature of work and then moves on to outline how trends and developments around technology and innovations of recent years are impacting the discipline of Talent Acquisition. Part IV uncovers the talent issues facing an organization (read Sigma) as it seeks to sustain its competitive advantage in a new business landscape. This

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part presents a systemic inquiry into the current state of talent operations at Sigma, examined through the lens of a framework predicated on “Design Thinking Principles.” The chapters reveal how a ground up view of its talent philosophy, corporate identity, structure, culture, internal processes, and technology were pivotal steps in setting the tone and priorities and eventually designing a high-impact business facing talent acquisition function. The chapters also bring together the art and science in the hiring process for a necessary dialogue that establishes a relational framework for how different bits of knowledge connect to and validate one another. Part V sheds light on the salient aspects of the “Centre of Excellence” (COE) model envisioned as the linchpin of a business facing talent acquisition function at Sigma. The chapters also highlight the importance of key leadership and cultural aspects in strengthening the foundation of a “Centre of Excellence” structure. The chapters in this part outline the characteristics and the delivery capabilities, which form the core of the COE model. They also capture the key milestones in this phase-wise implementation journey leading to the operationalization of the COE. Part VI turns to a “new look” and optimized talent acquisition function at Sigma. It unfolds to examine its best practices in a more fine-grained way, devoting a chapter each to the building blocks which combined together to deliver both positive financial and strategic impact. And finally, this part looks in detail at the efforts of Sigma to localize its talent acquisition strategy in new geographies leveraging Geert Hofstede’s cultural dimensions theory. In the concluding reflections chapter, I encourage us to see recruiting as a force for good – the cheerleader, steward, and ombudsman for people and work around the world. Here, I look at how embracing our fallibility not only lessens our likelihood of erring, but also helps us think more creatively, assess talent more thoughtfully, and construct freer and fairer hiring regimes. My body of work draws upon a wealth of empirical evidence. This means that much of what you will read is not precariously balanced on a froth of anecdotes and parable but built on a foundation of rigorous observation and cross-disciplinary reflections spanning neuroscience, behavioural economics, manufacturing, psychology and more. A “curious octopus”9 harnessing cross-disciplinary curiosity to create a rich intellectual and creative resource. I have strived to maintain intellectual rigour along the entire passage of this book (you’ll find technical and popular references for each chapter at the end of the book). 9

http://soulellis.com/2010/06/creative_morning_with_paola_an/

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Executive Summary

Hopefully this text will elevate awareness and discourse on the subject and help concretize a roadmap for organizations looking to revisit and re-invent their talent acquisition philosophies and practices as they compete for talent in a VUCA world. The book in many ways is about building a culture of originality. As organizational psychologist Adam Grant noted, “The hallmark of originality is rejecting the default and exploring whether a better option exists.” This is about bringing a vuja de10 perspective – we see something familiar, but we see it with a fresh perspective that enables us to get new insights into old problems and create new pathways for achieving excellence.

10

https://hbr.org/2014/03/can-you-see-the-opportunity-right-in-front-of-you

PART I A NOTE ON THE QUEST FOR EXCELLENCE IN HIRING

At the end of the movie Serendipity11, one of the main characters makes this statement: “The Greeks did not write obituaries. They simply asked, ‘Did he have passion?’”

Everybody has passion. Few people have jobs that activate their passion. Everybody has talent. Few people have jobs that demand full use of their talent and strengths. World-class organizations strive to make passion for excellence a key hiring requirement. They look beyond a person’s resume, work experience or education. Instead, they use the art-science of selection excellence to unravel the various petals of one’s identity to discover: “Do they have passion for excellence? Do they have the resilience to recover from a facedown moment? Are they easily motivated?” In sum, “What is their talent code; the philosophical kernel of their world view and how can we leverage them?” This process of discovery, as we will find out, is influenced by a confluence of many factors which need to be understood to lay out a roadmap for excellence in hiring. Let’s explore further…

11

https://www.amazon.com/Serendipity-John-Cusack/dp/B00003CY6M

CHAPTER ONE A PASSION FOR EXCELLENCE AT WORK

“If you wanted to crush and destroy a man entirely, to mete out to him the most terrible punishment,” wrote Dostoevsky, “all one would have to do would be to make him do work that was completely and utterly devoid of usefulness and meaning.” Indeed, the quest to avoid work and make a living of doing what you love is a constant conundrum of modern life. “Few people discover the work they love,” writes Lance Secretan in his book, Inspirational Leadership.12 “For many people, finding the work they love is a long surrendered high-school ideal. Work is what they must do, not what they love to do.” In How to Find Fulfilling Work,13 philosopher Roman Krznaric explores the roots of this contemporary quandary and writes: “This cynicism and skepticism with work is reflective of one of the key afflictions of the modern workplace – a plague of job dissatisfaction.” He calls it a grin and bear it approach, a view that says, “Forget the heady dream of fulfillment and remember Mark Twain’s maxim, ‘Work is a necessary evil to be avoided.’” From the forced labour used to build pyramids through to the soulless McJobs of the twenty-first century service sector, the story of work has been one of hardship and tedium. The history, as Roman Krznaric explains, is captured in the word itself, “The Russian for work, robota, comes from the word for slave, rab. The Latin labor means drudgery or toil, while the French travail derives from the tripalium, an ancient Roman instrument of torture made of three sticks.” The desire for fulfilling work is one of the great aspirations of our age and yet every day, countless hearths and hearts grow ashen in cubicles around the world as we succumb to the all-too-human tendency towards choosing what we should be doing in making a living over what we must do in order to feel alive.

12

http://www.amazon.in/Inspirational-Leadership-Destiny-Calling-Cause/ dp/0969456190 13 http://www.amazon.com/Find-Fulfilling-Work-School-Life/dp/1250030692/ ?tag=braipick-20#reader_1250030692

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Overwhelming evidence has emerged in the last two decades which underscores how people struggle to uncover the fundamental motivating forces that drive them to find meaning and create excellence in their work. Only 13 percent of employees worldwide are engaged at work, according to perennial engagement survey leader Gallup in its study of the State of the Global Workplace.14 In other words, one in eight workers – roughly 180 million in the countries studied – are psychologically committed to their jobs and likely to be making positive contributions to their organizations. The bulk of the employees worldwide – 63 percent – are “not engaged,” meaning they lack motivation and are less likely to invest discretionary effort in achieving organizational goals or outcomes. This disengagement has profound implications for companies. Simply put, passion, or its absence, isn’t just a philosophical or psychological matter – it’s a business problem too. Far too many companies lack employees who are passionate about their work and they flounder, or just get by. But some companies instil passion and thrive as a result. If you fly on Southwest Airlines, you can see and feel the passion in the air. Their slogan, “the airline that love built,” articulates the passion of their employees. “At far too many companies, when you come to the office you put on a mask,” writes Herb Kelleher in Leader to Leader.15 “We try not to hire people who are humorless, self-centered, or complacent, so when they come to work, we want them, not their corporate clones. They are what make us different, and in most enterprises, different is better.” Passion helps to engage an organization. When people discover the work that they love, work becomes more than a job – it becomes a unique calling, a life’s mission. People with passion for their work bring an almost infectious charm to their daily jobs with a strong rub-off on their customers. Southwest hires and develops people with a passion for their work, and customers see and feel this in almost every interaction. These are people not driven by the age-old work ethic, but by what author Pat Kane calls the “The Play Ethic”,16 which places them, their passions and enthusiasms at the centre of their world. Their credo is beautifully captured in a sentiment

14

http://www.gallup.com/services/178517/state-global-workplace.aspx http://www.amazon.com/Enduring-Insights-Leadership-Foundations-AwardWinning/dp/1118193458 16 http://www.amazon.in/The-Play-Ethic-Manifesto-Different/dp/0333907361 15

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Chapter One

expressed by the French writer François-René de Chateaubriand17 over a century ago: A master in the art of living draws no sharp distinction between his work and his play; his mind and his body; his education and his recreation. He hardly knows which is which. He simply pursues his vision of excellence through whatever he is doing, and leaves others to determine whether he is working or playing. To himself, he always appears to be doing both.

Companies like Southwest know that passion in the workplace drives a relentless desire to help and please, a hunger for excellence that’s insatiable, a thirst for success that’s unquenchable, and a devotion to an organization that’s unfailing. Passion drives the entrepreneur, motivates the athlete, calls the missionary, and births the leader. Tom Peters once quoted Ray Kroc, the founder of McDonald’s, to the effect that, to succeed at McDonald’s, “You must be able to see the beauty in a hamburger bun.” Most so-called “sophisticated” professionals laugh when they hear this, but just a few moments of reflection should make it clear that Mr. Kroc was right. You can’t become the world leader in a business as basic as hamburgers (or any other) without truly caring, passionately, about what you do. Business author, David H. Maister echoes a similar sentiment in his timeless treatise, True Professionalism18: “Believe passionately in what you do, and never knowingly compromise your standards and values. Act like a true professional, aiming for true excellence, and the money will follow. Act as a prostitute, with an attitude of I’ll do it for money, but don’t expect me to care, and you will lose the premium that excellence earns.” The problem is, such passion is all too rare in the workplace because organizations don’t know how to cultivate it. These organizations also know that passion cannot be manufactured or cloned. It’s innate, but not everybody brings it to his or her present role at work. So how do organizations go about hiring such dedicated people? The best organizations do this by crafting “signature experiences”19 – visible, distinctive elements of their employee experience that articulates the organization’s aspirations and the skills, stamina, and commitment employees will need to succeed there. In themselves, signature experiences create value for the firm but they also serve as a powerful and constant symbol of the organization’s culture and values. 17

https://www.britannica.com/biography/Francois-Auguste-Rene-vicomte-deChateaubriand 18 http://www.amazon.com/True-Professionalism-Courage-People-Clients/dp/ 0684840049 19 https://hbr.org/2007/03/what-it-means-to-work-here

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No company can build a coherent culture without people who share its core values or possess the willingness and ability to embrace those values. That’s why the greatest firms in the world also have some of the most stringent recruiting practices. According to Charles Ellis, as noted in a review20 of his book, What it Takes: Seven Secrets of Success from the World’s Greatest Professional Firms, “the best firms are fanatical about recruiting new employees who are just not the most talented but also suited to a particular corporate culture.” People stick with cultures they like, and bringing on the right “culture carriers” reinforces the culture an organization already has. Google’s recruitment process, for instance, is one of its signature experiences. Other organizations like Starbucks talk about internal brand rituals which bind their employees to the customer proposition and in turn offer value back to their people. The key brand ritual at Starbucks is their coffee tasting. When asked about the “secret” behind the superior Toyota paint finishes, one manager replied, “We’ve got nothing, technology-wise, that anyone else can’t have. There’s no secret Toyota Quality Machine out there. The quality machine is the workforce – everybody who has a hand in the production here takes the attitude that we’re making world-class vehicles. The human resource is the only one that competitors cannot copy, and the only one that can synergize – that is, produce output whose value is greater than the sum of its parts.” Apple only hires people who are passionate about what they do; and Genentech21 screens out people who ask too many questions about titles and options, because they only want people who are driven to serve customers. All this emphasizes the point that the employee experience element of defining and managing a brand is not about “one look or feel”, starting with recruitment communications. It is about understanding the core deal, understanding how it plays out across the talent segments, understanding how it has to hit the right balance between aspiration and reality to attract and retain and then manage the organizational behaviours accordingly throughout the employee journey. Becoming an employer of choice is as much about revisiting our theories about human nature as it is about revisiting our ideas about work and larger ecosystems of our workplaces. Invoking plenty of Adam Smith, Karl Marx, John Maynard Keynes and even a bit of Bruce Springsteen, psychologist 20

http://www.economist.com/news/business-books-quarterly/21576071-lessonsleaders-simply-best 21 https://www.gene.com/

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Chapter One

Barry Schwarz compellingly argues this fact in his inspiring manifest to Why We Work22: Forty years ago, the distinguished anthropologist Clifford Geertz said that human beings are “unfinished animals.” What he meant is that it is human nature to have a human nature that is very much the product of the society that surrounds us. We design human nature, by designing the institutions within which people live. Thus, human nature is to a significant degree the product of human design. If we design workplaces that permit people to find meaning in their work, we will be designing a human nature that values work.

This assemblage of research findings and studies by psychologists such as Barry Schwarz and others of his ilk is forcing us to question the nature of modern-day work. Organizations today are realizing that if they want to help design a human nature that seeks and finds challenge, engagement, meaning, and satisfaction from their work, they have to start building their way out of a deep hole that almost three centuries of misconceptions about human motivation and human nature have put them in. In his book, The Business Romantic,23 Tim Leberecht invites us to rediscover romance, beauty, and serendipity by designing experiences and organizations that “make us fall back in love with our work and our life.” To the growing concerns about the disruptive impact of technology on work, business and society, Tim responds with an alternative scenario: a romantic yet sustainable economy driven by vulnerable and empathetic leaders and employees on a mission to find real meaning in work. “There is a strong economic incentive for romanticizing our workplaces and cultivating experiences of friction, conflict, mystery and ambiguity at work,” he muses passionately. Bringing these emotions to work, instead of parking them at the door, would challenge and surprise the employees who, in return, would respond with higher levels of engagement and productivity. What People Value at Work A classic example24 of how to create a place where people draw on their authentic selves comes from Joey Altman, an American celebrity chef, restaurateur, TV host, and writer. Altman was the owner and head chef of the Wild Hare, a restaurant near Stanford in the US, and host of a popular 22

http://www.amazon.in/exec/obidos/ASIN/1476784868/petewill0e8-21 http://www.amazon.in/Business-Romantic-Everything-Quantify-Something/dp/ 0062302515?ie=UTF8&*Version*=1&*entries*=0 24 Excerpted from Hard Facts, Dangerous Half-Truths, and Total Nonsense, by Pfeffer J. and Sutton R.I. 23

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television cooking show called Bay Café. Joey had no formal management or leadership training, but developed an intriguing philosophy after working at 26 different restaurants. He hired primarily for attitude rather than experience, noting, “The right attitude for me is somebody who’s passionate about what they’re doing and they have a real desire to learn and they’re doing this not because they think it’s going to be some money but they really want to do it and they enjoy it.” He tried to give people work they really enjoyed, defined roles broadly, blurred traditional roles, and gave people as much freedom as possible to be creative. And he let them be themselves: What I decide is how the basic process should be handled. Not the means to get there, but what the end is. The end result is I want this to be beautiful, delicious, and hot. Whether you fry that first or you do that first and then do that, I don’t care as long as it’s beautiful and delicious. As far as service goes, I realize that I have ten waiters and ten different people. I don’t want Darrell to be like Joanie, and Joanie, I don’t want you to be like Susie. Paul, I want you to be the best Paul you can be. Susie, I want you to be the best Susie you can be. I just want you all to be knowledgeable and use your strengths of your personality to the best.

With that philosophy, it was little wonder that the turnover at Altman’s restaurant was a fraction of that in a typical establishment; his employees enjoyed what they did, and this enjoyment, enthusiasm, and creativity carried over to the food and service, making the dining experience the best in the area at the time. The fundamental theme here is that, while in the old economy promoting efficiency and organizing work reigned supreme, in the emergent new passion economy25 inspiring the passions of employees to create and innovate is far more important. The focus has to be on creating an environment in which challenge, engagement, meaning, and satisfaction are possible. Competing on Talent is as much about hiring people with the right attitude and values as it is about providing a signature experience that makes working at an organization unique. The best strategy in coming out ahead in the war for talent isn’t to scoop up everyone in sight. Instead, one needs to convince the right people – those who are intrigued and excited by the work environment organizations can offer and who will reward them with their loyalty – to choose them. The epigraph for “Competing on Talent,” is Henry David Thoreau’s seminal quote from his 1854 “Life without Principle” essay: Do not hire a man who does your work for money, but him who does it for the love of it. 25

http://www.digitaltonto.com/2010/the-passion-economy/

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Chapter One

In the context of my body of work, this quote embodies an organization’s core ideology that the right talent is the only critical competitive asset that helps create sustainable institutions. It helps establish an espirit de corps – the culture, the spirit – that is the hardest thing for competitors to imitate. The ideology, which served as a touchstone, saw this organization embracing a “hire for excellence” philosophy with a passion and an intensity akin to giving its hiring practices a “patina of spirituality,” “the importance of the mundane.” It was this drive and ability to optimize the mundane – the focus on the process – that imbued its prosaic hiring practices with an element of the magical. In this book, I will take you behind the scenes to discover this organization’s best practices and philosophies in action. But before we embark on this journey, I will lay out some key perspectives on why hiring decisions are the foundation to almost all great organizational performance, why does hiring go wrong so often and why the art and science must come together to keep hiring on the high road. After all hiring well is a strategy and it may, in fact, be an organization’s most important one.

CHAPTER TWO THE RIGHT HIRING MAKES ALL THE DIFFERENCE

“The most important decisions that business people make are not what decisions but who decisions.”

The line by Jim Collins from his timeless monograph Good to Great succinctly captures the number-one problem organizations face today: “Finding the Right People.” The importance of choosing the right people at all levels is the prevailing wisdom for organizations across the world and has generally found acceptance with practitioners and researchers alike. It is a key theme in Stanford Professor Jeffrey Pfeffer’s The Human Equation,26 where he masterfully builds a powerful business case for hiring and managing people effectively – not just because it makes for good corporate policy, but because it results in outstanding performance and profits. His research shows that companies that allocate resources towards a longterm human-asset strategy consistently achieve returns on the order of 30 percent to 50 percent greater than those that do not. In a similar study,27 authors Noam Wasserman, Bharat Anand, and Nitin Nohria argue persuasively that choosing the right leaders can have a dramatic impact on the company performance. In some situations, these three scholars, contend, the “leader effect” accounts for up to 40 percent variance in performance or value. For such cases, even a medium-sized company could increase its value by $1 billion through better people decisions at the top. With so much at stake, one does not require a Shakespeare’s soothsayer to predict, that in years to come, making the right hiring decisions will be

26

http://www.amazon.com/The-Human-Equation-Building-Profits/dp/0875848419 https://hbr.org/product/when-does-leadership-matter-a-contingent-opportunitiesview-of-ceo-leadership/6122BC-PDF-ENG 27

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even more important to organizational performance. Here’s why in this excerpt from Great People Decisions28: • The fastest growing companies, in fields like biotech, life-sciences, software, professional services, media, and entertainment, are humanasset intensive. In other words, success at these companies depends less on physical assets, and more on the talents of people, especially including their ability to work together. • We are living in times of unprecedented change driven by the explosion of technological development and innovation and the cascading impacts of genetic, digital, and knowledge revolutions. We are also facing extremely delicate political and cultural issues, in an increasingly complex global village. When new skills must be put in place – quickly and effectively – the right people decisions become imperative not just for success, but for survival. • The corporate world is witnessing a clear and healthy trend today towards cross-functional initiatives, whether for new product development or process redesign. These initiatives require a constant assembly of different teams including making the right people choices that go into the team composition. • In large corporations, many traditional processes are breaking down, and there is an increasing reliance on outside partners via in-sourcing and outsourcing. This is particularly visible in innovation processes of technologically oriented companies like IBM and Merck, to name just two. Today, companies know that they have to gain access to ideas of others. At the same time, they know that their own knowledge workers are increasingly mobile. A shifting capital base, including more active participation by venture capital partners, also pushes for change. As a result, many companies have been moving from a “closed innovation” to an “open innovation” paradigm as explained by Henry Chesbrough in his seminal book on the same topic.29 The experience’s of Apple’s app store and Google’s android store offer significant examples of this new business model designed to leverage the efforts of highly talented individuals and professionals. In a broader sense, this suggests that as technology opens new product and service possibilities, it opens space for new talents to be cultivated and applied. Fully integrating their talent and ideas into a business ecosystem will require making the right people decisions. 28

http://www.amazon.in/Great-People-Decisions-Matter-Master/dp/0470037261 http://www.amazon.in/Open-Innovation-Imperative-Profiting-Technology/ dp/1422102831 29

The Right Hiring Makes All the Difference

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Most of what we know about managing innovation comes from the study of products and technologies. Yet services today comprise roughly 80 percent of economic activity in the United States, and 60 percent of economic activity in the top 40 economies of the world.30 One has, but to imagine of the implications of dramatically increased innovation in services, from the point of view of the potential impact and the criticality of the best knowledge workers. Once again, picking the winners will be the key. To rephrase Claudio Fernandez-Araoz,31 “Great people decisions need active management. They are less like a physical infrastructure, and more like money, achieving their true potential only if you figure out how to deploy them effectively.” Mastering great hiring decisions – getting the right people on the bus and into the right seats – is the secret behind great organizational performance. And this is the reason why they matter. “A man hears what he wants to hear and disregards the rest.”32

But even as evidence piles up, hiring practices in many organizations reflects a different reality, moving in a direction exactly opposite to what a growing body of evidence prescribes. Moreover, this disjuncture between knowledge and actual practice is occurring at the same time as organizations, confronted with a highly competitive environment, are frantically looking for some magic elixir that will provide sustained success, at least over some reasonable period of time. So, even as organizations pursue success and the evidence for at least one important source of success – how they hire and retain the best talent – accumulates, many practitioners routinely ignore evidence about hiring practices that clashes with their beliefs and ideologies, and their own observations are contaminated with by what they expect to see and hear. Rather than put their hiring methods in perspective, many firms have sought solutions to competitive challenges in places and means that have not been very productive – downsizing and outsourcing in a futile attempt to shrink or transact their way to profit,33 and see employees as costs to be reduced in the face of economic pressures – even as they repeatedly proclaim, “people are our most important asset.” The “Dilbert Paradox”34 reigns supreme. So what it comes down to is this: Practices supported by evidence and logic, even some that appear in many instances to be common sense, may 30

Source: OECD. http://www.amazon.in/Great-People-Decisions-Matter-Master/dp/0470037261 32 http://www.simonandgarfunkel.com/track/the-boxer/ 33 http://www.amazon.com/The-Human-Equation-Building-Profits/dp/0875848419 34 https://hbr.org/2010/08/six-fundamental-shifts-in-the.html 31

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fail to be recognized and implemented. As Ken Robinson so powerfully explained in his 2010 TED Talk, “Bring on the learning revolution”: “The great problem for change or transformation is the tyranny of common sense. Things that people think, ‘It can’t be done differently, that’s how it’s done.’” Simply put, in the world of organizational management, common sense is not always all that common and perhaps the singular reason why hiring gets a failing grade. The foregoing implies that to make the connection between hiring and great organizational performance, organizations are going to have to adopt a different point of view. In the end, making the connection between hiring and bottomline performance entails confronting how we think about work, organizations, and the people in them. Do we see people as the only thing that creates competitive advantage? Or do we see people as labour costs to be reduced or eliminated; and mutual trust and respect as luxuries not affordable under current economic conditions? How we look at things affects how they look and what we do. And what we do shapes our reality. Reality, after all, is constructed through our very beliefs – not because we have a magical-thinking way of willing events and phenomena into manifesting, but as cognitive science has shown us: the way we direct our attention shapes our perception of what we call “reality.”35 This attention, as cognitive scientist Alexandra Horowitz invites us to believe in her breathlessly wonderful On Looking: Eleven Walks with Expert Eyes,36 is an intentional, unapologetic discriminator. It asks what is relevant now, and gears us up to notice only that. A case can then be made that if organizations approached hiring from a rigorous, objective, and strategic point of view with values of excellence at its core, then achieving enduring success is actually not that difficult. Well yes, but there are compelling reasons why mastering this is extremely hard. It deals with the psychology of why we have a hard time changing our minds – and it is the subject of our next chapter.

35

https://www.brainpickings.org/2013/08/12/on-looking-eleven-walks-with-experteyes/ 36 http://www.amazon.in/exec/obidos/ASIN/1439191255/petewill0e8-21

CHAPTER THREE WHY HIRING GOES WRONG SO OFTEN?

Allow yourself the uncomfortable luxury of changing your mind.

This reflection by Maria Popova in her mailing Brain Pickings points to a conundrum most of us grapple with. Expounding on this, she further writes – on the one hand, the awareness that growth means transcending our smaller selves as we reach for a more dimensional, intelligent, and enlightened understanding of the world, and on the other hand, the excruciating growth pangs of evolving or completely abandoning our former, more inferior beliefs as we integrate new knowledge and insights into our comprehension of how the world around us works. That discomfort, in fact, can be so intolerable that we often go to great lengths to disguise or deny our changing beliefs by paying less attention to information that contradicts our present convictions and more to that which confirms them. In other words, we fail the fifth tenet of Carl Sagan’s timelessly brilliant and necessary Baloney Detection Kit for critical thinking37 : “Try not to get overly attached to a hypothesis just because it is yours.” This human tendency in many ways is at the root of our bias laden hiring approaches which stymies our efforts to find and hire the right talent. Hiring has never been easy. About 2,000 years ago, officials in the Chinese Han dynasty attempted to create a scientific process for hiring civil servants with the goal to create intellectual meritocracy based on Confucian learning. They developed detailed job descriptions for various jobs; however, archaeological records show that the Han officials were frustrated by the results of their efforts; few new hires worked out as well as expected. Today, organizations are still trying to hire employees – with the same unhappy results. Their collective experience confirms what the Chinese learned in 207 B.C.: it’s impossible to turn hiring into a science. The process 37

http://www.amazon.com/The-Demon-Haunted-World-Science-Candle/ dp/0345409469

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has always been perception-based; gut-driven, subjective inputs continue to figure as important predictor variables in the hiring equation of companies. In the absence of unifying laws in hiring, unlike those that distinguish the physical sciences, there is little consensus on the attributes that predict success in strategic roles or how they interact and are optimally weighted in importance. Prehistoric Hardware and Victorian Software38 In most cases the process is undermined by psychological biases and emotional traps – The Enemy Within, which Claudio Fernandez-Araoz refers to in his book,39 It’s Not the How or the What But the Who. Through a series of short and engaging essays, he outlines the various cognitive biases and forces operating both within the hiring team and the organization at large that impede the process of recruiting great talent. He convincingly argues that there are fundamental reasons that lurk behind these forces. Homo sapiens emerged on the Savannah plain some 200,000 years ago, yet according to evolutionary psychology, people today still seek those traits that made survival possible then: “an instinct to fight furiously when threatened, for instance, and a drive to trade information and share secrets. Human beings are, in other words, still hardwired to make choices in the lower, unconscious parts of the brain – in fraction of seconds, with no deliberation – based on similarity, familiarity and comfort.” You can take the person out of the Stone Age, evolutionary psychologists contend, but you can’t take the Stone Age out of the person.40 We are therefore thinking, acting, working, and deciding on people today with a piece of hardware that is ten thousand years old.41 Despite the digitization of job listings, hiring practices have not changed much from the analogue days. “To make matters even worse our software is also obsolete,” avers Claudio Fernandez-Araoz, as he draws attention to the fact that the vast majority of managers and leaders haven’t received the proper education and training on assessing others and helping those around them to reach their highest potential. They don’t teach you how to hire in high school, college or even at Harvard Business School.42 38

https://www.amazon.com/Its-Not-How-What-but/dp/1625271522 Ibid. 40 https://hbr.org/1998/07/how-hardwired-is-human-behavior 41 http://www.amazon.com/Naturally-Selected-Evolutionary-Science-Leadership/ dp/B006CDDSIU#reader_B006CDDSIU 42 https://hbr.org/2008/12/seven-steps-to-smarter-hiring 39

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Erich C. Dierdorff and Robert S. Rubin of DePaul University conducted a research study43 to check the relevance of the typical MBA education by comparing it to an empirically based model of managerial competence – hard evidence of what makes leaders effective – as well as working managers. The three competencies rated most important in the real world were managing human capital, managing decisionmaking processes, and managing strategy and innovation. But these three were the least represented in required MBA courses. Only 29 percent of programs offered two or more courses in managing human capital, and a mere 19 percent had two or more focused on managing decisionmaking processes. By contrast, 87 percent gave that same high weight to managing administrative activities. Our hardwired brains helped us survive and reproduce in the past – an extant form of living. But, they don’t mesh well with our current people challenges. As a result, people’s decision-making processes are often impaired by a series of emotional biases, and higher the stakes the stronger these forces tend to be. It can be dangerous to rely too heavily on these “forces” or what experts call intuitive, System 1 thinking – automatic judgments that stem from associations stored in the memory – and less on careful reasoning. Behavioural economist, Daniel Kahneman, who won the Nobel Prize for his work with Amos Tversky on decision making argues in his thought provoking book, Thinking, Fast and Slow, that “if there are several ways of achieving the same goal, people will eventually gravitate to the least demanding course of action. In the economy of action, effort is a cost, and the acquisition of skill is driven by the balance of benefits and costs. Laziness is built deep into our nature.” Let’s consider the following simple question from Kahneman’s book: if a bat and ball cost $1.10 and the bat costs $1 more than the ball, how much does the ball cost? We all tend to quickly solve such a problem and most come up with the answer of 10 cents. The distinctive mark of this easy puzzle is that it evokes an answer that is intuitive, appealing, and wrong. The correct answer is 5 cents. The good news is that more than 50 percent of students at Harvard, Princeton, and MIT also get it wrong and the error rate is as high as 90 percent in lower ranked schools. The reason is that many people are overconfident, prone 43

Rubin R.S. and Dierdorff E.C., Academy of Management Learning & Education, vol. 8, no.2 (2009), pp. 208–224.

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to place too much faith in their intuitions. They apparently find cognitive effort at least mildly unpleasant and avoid it as much as possible. In a similar manner, many hiring managers deem the cost of process too high for the marginal improvement it promises over their intuitive abilities. They eschew energy-draining formality and trust their guts instead. This cognitive laziness is the life-blood of a psychological phenomenon called the backfire effect.44 David McRaney in his book, You Are Now Less Dumb,45 provides a fascinating account of this cognitive bug, where he writes: “Once something is added to your collection of beliefs, you protect it from harm. You do this instinctively and unconsciously when confronted with attitude-inconsistent information. Just as confirmation bias shields you when you actively seek information, the backfire effect defends you when the information seeks you, when it blindsides you. Coming or going you stick to your beliefs instead of questioning them. When someone tries to correct you, tries to dilute your misconceptions, it backfires and strengthens those misconceptions instead. Over time, the backfire effect makes you less skeptical of those things that allow you to continue seeing your beliefs and attitudes as true and proper.” But what makes this psychological phenomenon especially worrisome is that in the process of exerting effort on dealing with the cognitive dissonance produced by conflicting evidence, we actually end up building new memories and new neural connections that further strengthen our original convictions. Now it’s not the intent of this chapter to diminish the ability of intuition or the power of our adaptive unconscious to capture what is true about the human nature but to acknowledge our own fallible humanity and become a little more motivated to use tools like Sagan’s Baloney Detection Kit46 as weapons of self-defence against the aggressive self-righteousness of our own minds. Cognitive biases are unavoidable. They creep up unconsciously and they erode the rationality that we think we embody. The emerging field of behavioural economics is helping us understand how irrationality is the real invisible hand that drives human decision making. As Dan Ariely shows us in his thought provoking treatise Predictably Irrational,47 “It’s been a

44

https://www.brainpickings.org/2014/05/13/backfire-effect-mcraney/ http://www.amazon.in/exec/obidos/ASIN/1592408052/petewill0e8-21 46 https://www.brainpickings.org/2014/01/03/baloney-detection-kit-carl-sagan/ 47 http://www.amazon.in/Predictably-Irrational-Revised-Expanded-Decisions/dp/ 0061353248 45

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painful lesson, but the silver lining may be that companies now see how important it is to safeguard against bad assumptions.” If we are not open to questioning the basic assumptions we make about human behavior in our hiring ways, we risk missing out on talent that could help drive the future of our organizations. In Leo Tolstoy’s nonfiction magnum opus The Kingdom of God Is Within You, he writes: “The most difficult subjects can be explained to the most slow-witted man if he has not formed any idea of them already; but the simplest thing cannot be made clear to the most intelligent man if he is firmly persuaded that he knows already, without a shadow of doubt, what is laid before him.” Although it can be disorienting to recognize these issues of bias, an awareness of the same can ultimately help us. Armed with the knowledge that we are motivated by cognitive biases, of which we are largely unaware, we can mitigate the risk they pose on our analytics, optimization, and growth. For it’s in the fusion of the rational and the intuitive that the full construct of one’s talent and potential stand demystified. And human talents are like natural resources; they are often buried deep. We have to go looking for them; they are not just lying around on the surface. We have to create the circumstances where they show themselves. Leveraging the art with the science in hiring can help sculpt an environment that optimizes creative flow and summon an individual’s talent to reveal itself. As you read through this book, you will see that the discipline of hiring is a far richer tapestry than the threads of scientific rigour or intuitive understanding alone can weave. Science needs art to frame the mystery, but art needs science so that not everything is a mystery. Competing on Talent requires hiring approaches which marry both the cultures: the art and the science.

CHAPTER FOUR THE 11 DEADLY HIRING TRAPS

“I can calculate the motions of heavenly bodies but not the madness of people.” – Isaac Newton after losing his savings in the South Sea bubble of 1720

Many organizations are in the same quandary as Newton was almost 300 years ago. They have to make decisions about complex situations with many interrelated, yet unpredictable elements. These situations are imbued with features that may appear in patterned ways but whose interactions are continually changing. A hiring decision, for example is highly complex – it contains a number of interactive, interdependent, and diverse elements, the weighing and interaction of which are rarely obvious. The essence of such an environment is the lack of any discernible pattern in its evolution. It is an environment where the mysteries of motivation, fit, and potential do not exhibit a linear cause and effect relationship. In an age where every other management process has been studied and codified, it is amazing to find that people still view hiring as something that resists an orderly approach. Hiring managers driven by unconscious biases cling to their favourite methods even when evidence suggests they don’t work. They probe generic strengths, weaknesses, and career aspirations. Gut feel, hunches, and trick questions pepper the discussions. Whether we call it our “gut,” or as pastors and church leaders sometimes say, our “spirit of discernment,” we all have been guilty of the kind of people, Patrick Lencioni48 describes in his book The Advantage, who “persist with the belief that they know a good person when they see one and that they can go about the hiring process without much structure.” After all, they have been sizing up people in one way or another since they were kids. A major review of both academic and practitioner research about selection and hiring explains why gut-feel regularly wins the day over rigorous hiring processes and how savvy job-seeking candidates use this

48

https://www.tablegroup.com/pat/

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knowledge to their advantage, feeding a cycle of poor decision-making for all concerned. This chapter takes a sneak-peek at the top voodoo hiring methods49 and attempts an honest assessment on why it’s the professional more than it’s the technique that matters in hiring top talent. The hiring traps presented in this section are excerpted from Who – The A Method of Hiring by Geoff Smart and Randy Street. I have added one of my own favourites to this assemblage at the end. The Fortune Teller Just like a fortune-teller looking into a crystal ball to predict the future, these interviewers like to ask their candidates to look into the future regarding the job at hand by posing hypothetical questions regardless of the particulars of a situation: “What are your strengths or weakness?” or “Where do you want to be five years from now?” These are bad questions because they tend to turn an experience into an abstraction by cutting it from its roots. The answers that come back come out of an experiential vacuum and the hiring manager has little idea how they correlate with on-the-job performance. Performance on these kinds of questions is at best a discrete skill that can be improved through practice, eliminating their utility for assessing candidates. The flirtation of these hiring managers continues despite the bulk of the academic literature on interview methods making a strong case against using these types of questions. The Prosecutor This sect of hiring manager’s act like the prosecutor they see on TV. They aggressively question candidates, attempting to trip them up with trick problems and logic problems. What percentage of the world’s water is contained in a cow? Why are manhole covers round? The usual justification for trick questions, Zen-like riddles and similar such devious interviewing techniques is that they test broad, general abilities not tied to any specific skills. Whether they do that is hard to say. What’s certain is that these “pet” questions take on a talismanic quality for interviewers in this category. Just as athletes don’t change their shirt during a winning streak these interviewers keep asking the same questions because of a few remembered instances where it supposedly “worked.” 49

https://www.amazon.com/Who-Geoff-Smart/dp/0345504194/ref=sr_1_1?s=book s&ie=UTF8&qid=1440615556&sr=1-1&keywords=who+geoff+smart#reader_ 0345504194

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The Suitor Rather than rigorously interviewing a candidate, such hiring managers spend all their energy selling the applicant on the opportunity. They are already “sold” on the credentials of the prospective candidate without really interviewing him or her (“He’s an engineer from Google, we have to get him to join”). The approach is fraught with peril as you may end up buying a reputation, rather than an individual who embodied that reputation. Suitors are more concerned about “wooing” prospects than assessing them. They spend all their time in an interview talking and virtually no time listening. A religious lack of any due diligence is the hallmark of this hiring approach which revolves around the la-di-da interviewing style – nice lunch, nice chat. Suitors land their share of candidate, but they take their chances with the candidate actually being a good fit. The Personality Tester This breed of managers believes that deconstructing the concept of personality and putting it to work in people choices is an easy task. The Big Five, MBTI, CPI, and similar such tests make up the hiring tool-box of these managers. While research shows the efficacy of these tests as highly suspect in hiring situations, these managers continue with their bad romance. They are “Those who love type souls who have been seduced by an image of their own ideal self,” writes Annie Murphy Paul in her scathing exposé50 on the history and effects of personality tests. By definition, personality assessments simplify complexity. That’s not always a bad thing; putting a label on something helps us recognize it quickly. It’s shorthand. And, given that most of us have more to do than we have time for, shorthand is useful. But not with people. People are not easy to understand, and are too interesting and too complicated to be summed by a personality test.51 These tests are most effective when combined with other measures with higher predictive validity, such as work sample tests or tests for cognitive ability. Hiring managers who swear by such tests need to go well beyond them if they want to make great people choices. Meanwhile, though, these evaluations should be used and interpreted with a grain of salt.

50 https://www.amazon.com/The-Cult-Personality-Testing-Misunderstand/dp/ 0743280725/ref=sr_1_1?ie=UTF8&qid=1379425648&sr=8-1&keywords=cult+of +personality+testing 51 https://hbr.org/2015/08/employees-cant-be-summed-up-by-a-personality-test?

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The Aptitude Tester The close cousin of the Personality Tester, these interviewers swear by the efficacy of aptitude testing in their hiring decisions. Nothing wrong with the approach, but its predictive ability is highly suspect when used in isolation. Academic studies have concluded that such tests can determine whether a person has the right aptitude for a given role, such as persistence for a business development position…but they should never become the sole determinant in a hiring decision. Aptitude is only part of the larger hiring equation and organization psychologists52 affirm that its intuitive appeal to some managers notwithstanding, the linkage to performance is much lower than the field has led us to believe. The Trickster Puzzles, trick questions, and logical games have a long history, from the riddle of the sphinx to the impenetrable challenges of the Japanese Zen masters. But it was the early days of the Silicon Valley and the emergence of the technological revolution that spawned a breed of corporate interviewers who got their rush of adrenaline by making candidates squirm in their seats. Much like prosecutors, these interviewers see this approach as revealing valuable insights into a candidate’s thinking, initiative, and resourcefulness. To be fair, the technique does have its merits in certain organizational contexts and has also helped shift the interview tone from a conventional conversational style to a more exacting examination of candidate ability. But this hiring style doesn’t quite seem to “play the game” for senior roles, where the leadership challenge is less about figuring out the right solution than in identifying what the fundamental problem is in the first place. It assesses cognitive ability in a very narrow sense and largely fails to grapple with the tasks senior professionals face in the fast changing information age. The Art Critic When it comes to juggling art, going on gut instinct sometimes works just fine. A good art critic can make an accurate appraisal of a painting within minutes. With hiring though, people who think they are naturally equipped to “read” people on the fly are setting themselves up to be fooled big time. Armed with some extra-sensory perception, this breed of hiring managers ensures that their gut feel, hunches, and likeability triumph over job fit. To exacerbate matters, their strong belief in the wisdom of intuition makes 52

http://www.wsj.com/articles/are-workplace-personality-tests-fair-1412044257

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them blind to the less romantic realities of business decision making. After all, pragmatists act on evidence and heroes act on guts.53 Right? Au contraire! The entire field of behavioural economics has been built on the intensifying recognition that people, particularly smart ones, are suckers for cognitive illusions and heuristic biases54 that pretty much guarantee that their romance of the gut, will, on average, yield hurt burn. The Animal Lover This clan of managers hold on stubbornly to their back pocket list of pet questions – questions they think will reveal something uniquely important about a candidate. These managers are obsessed with judging candidates with answers to questions such as: “If you were an animal what type of animal would you be?” They look for people who have a witty answer – fun, yes but does it have any predictive validity for the job? Not only do questions like these lack any relevance or scientific basis, but they are utterly useless as predictors of on-the-job performance. The Sponge Sponges are like the art critics who need a little more data before making an assessment. A common approach among such managers is to let everybody interview a candidate. The goal of this sponge like behaviour is to soak up information by spending as much time with people as possible – and then synthesize the information in the gut. Unfortunately, these managers rarely coordinate their efforts, leaving everybody to ask the same superficial questions. The Sponge’s ultimate assessment of the person he hires rarely goes deeper than “He’s a good guy!” Their method of due diligence is by mucking around. The Chatterbox As a rule, we humans like to stick with the familiar. When we hire people to work for us, we talk about finding a “good fit” between the organization and the individual. In most instances, that’s really code for hiring a person who represents the comfortable and familiar, as opposed to seeking the best combination of competence and complementarity.55 If we think logically 53

https://hbr.org/2006/01/a-brief-history-of-decision-making https://hbr.org/2010/05/your-gut-is-overrated-really.html 55 https://www.amazon.in/gp/product/B00852Z0SC/ref=oh_aui_d_detailpage_o06 _?ie=UTF8&psc=1 54

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about it, complementarity necessarily implies diversity, which may argue against a “good fit.” This club of hiring managers spend their whole time on small talk and have a tendency to highly rate people who are just like them – when we praise people similar to ourselves, after all, we reinforce our own self-worth. Thus an Ivy League M.B.A. who worked at a blue chip M.N.C. will always prefer the candidate in the pack who has the same credentials. Certainly, familiarity can bring stability to any community. But it can also militate when a change is needed that requires completely different competencies. The Purple Squirrel Hunter Writer Alvin Schwartz56 once suggested superman is a tulpa, a Tibetan word for being brought to life through thought, visualization, and will power. Hiring managers continue to wish and hope that the answer to whatever ails their organization can be found in one generic super star. They wrestle with whether to hire for the company they plan to become, the company they wish they were, or the company they actually are. Unable or unwilling to acknowledge the “work-in-progress” that they are, these hiring managers hold up idealized representations against which they evaluate candidates. They continue to search for those “stars,” who twinkle with the magic pixie dust of brains, charisma, creativity, drive, and on and on; characters, who can single-handedly turn around a company’s fortunes, blaze paths of innovation, and market their wares like no other before them. However, much like purple squirrels in nature, the perfect candidate remains more myth than reality. The reality of this myth is that for every purple squirrel hire out there, there are dozens, if not hundreds, of open, unfulfilled job openings. Purple squirrels aren’t measures of success. At the very best, they are a measurement of luck and at the very least, they are a sad result of a poor understanding of the employment market and a company’s recruiting capabilities and consequences. Based on insights gleaned from more than 1300 hours of interviews with some of the world’s most successful business leaders, the authors of Who,57 write: that at the bottom line, all these voodoo hiring methods share an assumption that it’s easy to assess a person. Just find the right gimmicks, pop the right quiz, and trust the scattered chicken bones to point the way, and you are certain to have great hiring outcomes. Beyond that we are all 56

https://www.amazon.com/An-Unlikely-Prophet-Metaphysical-Legendary/dp/ 1594771081 57 http://www.whothebook.com/authors/

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prone to cognitive traps. We want to make quick decisions to get on with things. We like to see people as fundamentally truthful. We wish that it were so, but one of the painful truths of hiring is this: it is hard to see people for who they really are. The real difficulty is not finding new ways to distinguish talent; it is getting rid of the one-dimensional blinders that prevent us from seeing it all along. Of course, the blinders that are most important to eliminate are the ones we use to look at ourselves. People and organizations are complex, but that doesn’t mean we can’t use evidence to inform better hiring practices.

CHAPTER FIVE BEYOND THE ROMANCE OF THE GUT

It is ironical that while organizations recognize the importance of “Who Decisions” to create marketplace success, most pay little attention to the individual conducting the assessment. The Employment Interview Handbook, by Eder and Harris, looks at the question of whether some interviewers are better than others. Five out of the six studies reviewed confirm this hypothesis. In some of these studies, the best interviewers had predictive validities 10 times better than the worst interviewers. Research has also shown that, while the best professional interviewers have a “validity” (correlation between assessment and performance) of 0.7, the worst have slightly negative validity, being in fact worse than flipping a coin. If we knew about their incompetence, we would actually do the opposite of what they recommend! Robert Dipboye,58 a leading global authority on selection interviews, provides some powerful insights based on the study of differences in the validities across interviewers. He concludes that interviewers who achieve much higher levels of validity than others tend to better manage their emotional and psychological biases. They embrace an “attitude of wisdom”59: act on the best information they have, “while doubting what they know.” It entails striking a balance between arrogance (assuming you know more than you do) and insecurity (believing that you know too little to act). It requires asking for help and asking questions, as well as giving help and answering questions. The payoff: These hiring managers benefit from “enlightened trial and error” and the learning that occurs as a consequence. The exhibit below reproduces an extract from a study, establishing the link between the IRR and the hiring approaches of various hiring managers. The “Airline Captain” in the illustration is a proxy for high-calibre hiring managers who employ a disciplined and rigorous hiring process to separate the “wheat from the chaff.” Their interviews amount to a richly detailed audition for candidates akin to a “calling” to get the right people for the right jobs. 58 59

https://www.linkedin.com/in/robert-dipboye-6817262b https://ssir.org/articles/entry/act_on_facts_not_faith

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Chapter Five

Writing some years back ago about the foibles of how we hire people, The New Yorker’s Malcolm Gladwell wrote, “For most of us the job interview functions as a desexualized version of a date. We are looking for someone with whom we have a certain chemistry, even if the coupling that results ends in tears and the pursuer and the pursued turn out to have nothing in common. We want the unlimited promise of a love affair.” The upshot is that in a world of accelerated change in organization forms and managerial capabilities, in which new competencies are constantly required, and where some of the most relevant competencies are very difficult to assess, you need to select the right selectors. Decoding the Hiring Manager What do these high-calibre assessors look like? The vice gods as Claudio Fernandez Araoz calls them in his book,60 must be familiar with a range of experiences and competencies relevant to the position. Research has shown that individuals who are good judges of people possess appropriate judgmental norms as well as general and social intelligence; however, “probably the most important area of all that is motivation61: “if the judge is motivated to make accurate judgments about his subject 60 61

http://www.amazon.in/Its-Not-How-What-But/dp/1625271522 http://psycnet.apa.org/psycinfo/1956-00593-001

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and if he feels himself free to be objective, then he has a good chance of achieving his aim.” These judges have the courage to focus on candidate’s underlying character and motivation, rather than sticking merely to classic measures of experience. Some of the best insights on a candidate’s potential come from leaders whose own life experiences speak to the traits they are seeking. It requires a certain blending of the “mindfulness of Sherlock Holmes” with the “expansive sensitivity of Thoreau.” What makes these leaders compelling is their yin-yang balance of seeming opposites – incredibly intelligent in a rationally-driven way yet sensitive to the art of seeing. These talent miners demonstrate a willingness to put aside belief and conventional wisdom – the dangerous half-truths that many embrace – and replace these with an unrelenting commitment to gather the necessary facts to make more informed and intelligent hiring decisions. To keep hiring on the high road, stakeholders must recognize the need to use the right assessment techniques and involve the right number of highly qualified and motivated interviewers aka talent spotters. It’s critical to note that it’s more important to choose the right assessors than to focus on the assessment technique. Getting the wrong people involved in the hiring process increases the risk not only of hiring an unsuitable candidate but also of not hiring the right candidate for the wrong reason. Also remember that you don’t just want to assess the candidate. You want them to fall in love with you. Really. You want them to have a great experience, have their concerns addressed, and come away feeling like they just had the best day of their lives. Interviews are awkward because you’re having an intimate conversation with someone you just met, and the candidate is in a very vulnerable position. It’s always worth investing time to make sure they feel good at the end of it, because they will tell other people about their experience – and because it’s the right way to treat people. The most effective hiring managers all converge on a single goal: identifying talent with the skills and the resolve to succeed, rather than getting sidetracked by the short-lived allure of glittering resumes and charming personalities. As Capital One’s CEO Richard Fairbank put it several years ago, “At most companies, people spend 2% of their time recruiting, and 75% managing their recruiting mistakes.” A small investment in learning how to better pick candidates will bring huge personal and organizational dividends in the future.

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Reflections on Evidence-Based Hiring Practices The human understanding is no dry light, but receives infusion from the will and affections; whence proceed sciences which may be called “sciences as one would.” For what a man had rather were true he more readily believes. Therefore he rejects difficult things from impatience of research; sober things, because they narrow hope; the deeper things of nature, from superstition; the light of experience, from arrogance and pride; things not commonly believed, out of deference to the opinion of the vulgar. Numberless in short are the ways, and sometimes imperceptible, in which the affections color and infect the understanding. Francis Bacon, Novum Organon (1620)

The nineteenth century French physician Pierre-Charles-Alexandre Louis put a lot of leeches out of business. For centuries before his research, doctors believed that removing a few pints of a person’s blood would help cure all sorts of ailments. In the 1830s, doubting bloodletting’s alleged effects, Louis undertook one of the first clinical trials. He compared the fates of 41 pneumonia victims who had undergone early and aggressive bloodletting to the fates of 36 pneumonia victims who had not. The body count was clear: 44 percent of the bled patients subsequently died, compared to only 25 percent of the patients who did not get the bleeding treatment. Louis’ discovery helped convince physicians to abandon bloodletting and earned him the title “Father of Epidemiology.” His study is a touchstone of the modern evidence-based medicine movement, which trains physicians to conduct, evaluate, and act according to research.62 Despite the wealth of research on how hiring has the maximum business impact of any HR function, evidence-based aka data driven practices remain a pipe dream in many organizations. Instead, managers frequently base their hiring decisions on hope, fear, dearly held ideologies, what others are doing, and what they have done in the past – in short, on lots of things other than evidence. As a result, many managers inadvertently harm their organizations and stakeholders in much the same way that bloodletting doctors inadvertently harmed their patients. In medicine, evidence-based movement arose in response to thousands of deaths and billions of wasted dollars that could have been avoided by applying proven practices. Similarly, in the field of recruiting, the growing

62

https://ssir.org/articles/entry/act_on_facts_not_faith

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pile of studies on the human and financial costs of questionable hiring practices suggests the need for an evidence-based hiring regime. The time has come for organizations to embrace an evidence-based hiring movement. Admittedly, in some ways, the challenge is greater here than in medicine. Still, it makes sense that when hiring manager’s act on better logic and evidence, their companies can trump the competition. If as a leader in your organization, you wish to begin nurturing an evidence-based hiring approach, then you could consider embracing Carl Sagan’s Baloney Detection Kit. What’s in the kit? A set of cognitive tools and techniques that fortify the mind against penetration by falsehoods. The kit, Sagan argues, isn’t merely a tool of science – rather it contains invaluable tools of healthy scepticism that apply just as elegantly, and just as necessarily, to the many aspects of organizational life. He also offers a caveat here: Like all tools, the baloney detection kit can be misused, applied out of context, or even employed as a rote alternative to thinking. But applied judiciously, it can make all the difference in the way we approach hiring. Finding great talent is hard. A little bit of empiricism can help. Among the tools: ‡ Wherever possible there must be independent confirmation of facts to meet a minimum quality threshold. For instance, as organizations grow, they usually end up hiring average people over the long run. Hiring decisions inevitably move away from a focus on excellence, while organizations become pressured to hire faster and to hire based on similarity, comfort and convenience. This is because of something called regression to the mean63 – a concept from statistics which basically says that exceptional performance can’t last forever. It is part of the variability built into human activity, especially when doing something moderately complex. To ensure a high bar for quality, it is important that an independent committee review the evaluation results and make the decision. ‡ Encourage substantive debate on the evidence to hire by knowledgeable proponents of all points of view. ‡ Arguments from authority carry little weight – “authorities” have made mistakes in the past. They will do so again in the future. Perhaps a better way to say it is that in science there are no authorities; at most, there are experts. ‡ Spin more than one hypothesis. If there’s something to be explained, think of all the different ways in which it could be explained. Then 63

https://academic.oup.com/ije/article/34/1/215/638499/Regression-to-the-meanwhat-it-is-and-how-to-deal

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think of tests by which you might systematically disprove each of the alternatives. What survives, the hypothesis that resists disproof in this Darwinian selection among “multiple working hypothesis,” has a much better chance of being the right answer than if you had simply run with the first idea that caught your fancy. ‡ Try not to get overly attached to a hypothesis just because it is yours. It’s only a way station in the pursuit of knowledge. Ask yourself why you like the idea. Compare it fairly with the alternatives. See if you can find reasons for rejecting it. If you don’t, others will. ‡ Quantify. If whatever it is you’re explaining has some measure, some numerical quantity attached to it, you’ll be much better able to discriminate among competing hypotheses. What is vague and qualitative is open to many explanations. ‡ If there’s a chain of argument, every link in the chain must work (including the premise) – not just most of them. ‡ Occam’s razor. The convenient rule-of-thumb urges us, when faced with two hypotheses that explain the data equally well to choose the simpler. In accordance with Occam’s razor,64 the simplest techniques are often the best. ‡ Always ask whether the hypothesis can be, at least in principle, falsified. Propositions that are untestable, unfalsifiable are not worth much… Inveterate sceptics must be given the chance to follow your reasoning, to duplicate your experiments and see if they get the same result. In addition to teaching us what to do when evaluating a claim to knowledge, any good baloney detection kit must also teach us what not to do. It helps us recognize the most common and perilous fallacies of logic and rhetoric. One good example can be found in the Narrative Fallacy, about which Nassim Nicholas Taleb writes in his groundbreaking work, The Black Swan: “The fallacy is associated with our vulnerability to over-interpretation and our predilection for compact stories over raw truth. It’s the way past information is used to analyze the cause of events when so much history is actually ‘silent’. It is the silence – the gap – the missing energy in the historical system, which produces the black swan.” Imagine, says Taleb, the problem of turkeys – exhibited in the figure below: “Every single feeding will firm up the bird’s belief that it is the general rule of life to be fed every day by friendly members of the human race ‘looking out for its best interests’ , as a politician will say. On the afternoon of Wednesday before Thanksgiving, something unexpected will happen to the turkey. It will incur a revision of belief.” 64 https://thelogicofscience.com/2015/02/25/the-rules-of-logic-part-5-occams-razorand-the-burden-of-proof/

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ONE THOUSAND AND ONE DAYS OF HISTORY

A Scientific Coolness of Judgement that Tempers the Intuitive Heat We predict the future as a reflection of the past – and the notion of narrative fallacy suggests that our narrative of the past is, more often than not, flawed. Applied to hiring, one doesn’t have to construct a “best hire” narrative based on the success on observations of the past. At the same time, just because the past is not a template for the future, it doesn’t mean one has to go about building a template for the future that is deliberately different from the past. The message here is that it can be misleading, fallacious to build a general rule or draw a factual conclusion from observations based on flawed historical narratives alone. Evidence-based hiring is first and foremost, a way of seeing the world and thinking about the craft of hiring; it proceeds from the premise that using better, deeper logic and employing facts, to the extent possible, permits organizations to hire more effectively. This does not suggest that hiring processes be made completely algorithmic. Often, the question of what constitutes effective hiring is reduced to the question of whether it’s an art or a science, and that’s too binary. It’s both. I believe that we need a closer inspection of how the “inscrutability of art and the impenetrability of science” intersect in a shared system of thinking to qualify excellence in hiring. The belief is that science and its methods should complement experiential judgment by bringing in a mindset that blends the receptivity of art with the critical thinking of science.

CHAPTER SIX BLENDING THE ART & SCIENCE OF HIRING

“There is no science without fancy, and no art without facts.”

Vladimir Nabokov65 may well have been thinking of hiring, when he expressed this sentiment. One of twentieth century’s greatest thinkers, Nabokov broke the boundaries of art and science by stating that the most precious desideratum of each domain must also characterize any excellence in the other. This reflection to me is best embodied in the discipline of hiring, where understanding the complexities and the nuances of human behaviour require equal regard for data and instincts; enriching instincts with data and ennobling data with instincts in a quest to “increase the probability of making good hiring decisions.” Both the science and the art provide us with a way of knowing. And, in fact, as Clifford Geertz has pointed out, innovative thinkers in many fields are blurring the genres, finding art in science and science in art in all human creation and activity. Hiring is both art and science, though the science part tends to get ignored. The true power of science, cosmologist Carl Sagan once observed, lies not into our culture’s addiction to simplistic and readymade answers but in its methodical dedication to asking what Hannah Arendt66 called the “unanswerable questions” that make us humans, then devising tools for testing their proposed answers. Today, the science in recruiting has allowed us to let the facts in, even when they don’t conform to our misconceptions. It has helped create an interesting potpourri of resources which counsel us to carry alternative hypotheses in our heads and see which best fits the facts. The payoff: decoding a jagged resume, listening to a talent that whispers, and embracing talent wherever it surges becomes much easier in our quest for excellence in hiring. And while organizations should be buoyed by the promise of these advances, they should also be wary for science alone will never slay the

65 66

https://www.britannica.com/biography/Vladimir-Nabokov https://plato.stanford.edu/entries/arendt/

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hiring beast with absolute certainty. The history of science, Sagan asserts, teaches that the most we can hope for is successive improvement in our understanding, learning from our mistakes, an asymptotic approach to the Universe, but with the proviso that absolute certainty will always elude us. The Human Factor The essence of being human is that one does not seek perfection. George Orwell, In Front of Your Nose: 1945-1950 Based on his work at some of the world’s largest organizations, including Ford, Adidas, and Chanel, Christian Madsbjerg’s Sensemaking is a provocative stand against the tyranny of big data and scientism, and an urgent, overdue defense of human intelligence. When we need to understand people – real people in the rich reality of their worlds – we need this type of human intelligence. Christian Madsbjerg argues that we humans have become subservient to algorithms. Every day brings a new Moneyball fix – a math whiz who will crack open an industry with clean fact-based analysis rather than human intuition and experience. As a result, we have stopped thinking. Machines do it for us. Contrary to popular thinking, Madsbjerg shows how many of today’s biggest success stories stem not from “quant” thinking but from an artful synthesis of both knowledge and experience. He calls this method Sensemaking, further adding that it is not a superficial brush-up on the arts – throwing on an album as background music or cruising through a museum exhibit in thirty minutes before going out for a drink. But a demanding form of engagement. Its rigor is precisely what makes it so rewarding. The power of science does not negate the need for human insight and dexterity, a thought which gains weight in this sentiment attributed to one of history’s most celebrated heroes of science, Albert Einstein: The intuitive mind is a sacred gift and the rational mind is a faithful servant. We have created a society that honors the servant and has forgotten the gift. In the same vein, a recent publication noted that the most important predictor of whether a patient actually benefits from cancer testing or treatment is not the sophistication of the technology being used, but rather the skill of the administering doctor. Similarly, scientific advances in recruiting will always require skilful hands to apply and interpret them, hands which respect the context and complexities of recruitment’s many moving parts. No algorithm or neural computation will replace that commitment, or the discipline and skill accompanying it.

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Getting Art and Science to Work together Jonah Lehrer in his book, Proust Was a Neuroscientist,67 makes a case for the extraordinary importance of cross-pollination of disciplines, particularly of art and science – a convergence he calls the “fourth culture” that empowers us to “freely transplant knowledge between the sciences and the arts, and focus on connecting the reductionist fact to our actual experience.” The reductionist methods of science must be filled with an artistic investigation of our own experience. The discipline of hiring involves both artistic and scientific processes. Authors Joseph M. Hall and M. Eric Johnson, in their Harvard Business Review article,68 assert that “in such cases, the output of the scientific processes should provide a stable platform on which artists can then apply their craft. The two kinds of processes need to be separated, however, because they have different goals and metrics of success.” Let’s consider these two process components in the hiring life-cycle and how their coming together creates a nice division of labour to illuminate the hiring discipline: Art (of Intuition) What we call “art” is often described as “judgment-based work” or “professional work.” Art is needed in changeable environments (for example, when raw materials aren’t uniform and therefore require a craftsperson’s judgment or expertise) and when customers value distinctive or unique output (in other words, customer preferences and their underlying motivations need to be clearly understood). Every art has its own medium or raw material – oil, water-colours, marble, clay, bronze…For the art of hiring, the medium is people and the artistry of blending a new personality in an organization requires a leaning on the judgment and professional craft – intuitive abilities – of skilled hiring practitioners – recruiters, hiring managers – who can customize the relationship building, assessments, and related hiring aspects to attract, engage, and onboard high potential hires. Self-checking and feedback mechanisms are crucial for sound intuitive decisions as the exhibit below outlines:

67 68

http://www.amazon.in/exec/obidos/ASIN/0547085907/petewill0e8-21 https://hbr.org/2009/03/when-should-a-process-be-art-not-science

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This intuition is based on years of accumulated experience, deliberate practice, knowledge, and wisdom that skilled practitioners can draw on in making informed hiring decisions. But, what exactly lies behind this amorphous phenomenon we call “intuition”? Let’s explore further… “The heart has its reasons, which reason does not know… We know truth, not by the reason, but also by the heart.”

This observation by Blaise Pascal, the great French physicist, philosopher, and mathematician underscores the power and fruitfulness of intuition that has had innumerable and celebrated champions – from Einstein and Steve Jobs to some of history’s greatest scientists and philosophers. CUNY philosopher professor Massimo Pigliucci in his book Answers for Aristotle,69 presents an important debunking of the term intuition, which he writes, is a domain-specific ability that relies on honed critical thinking rather than a mystical quality bestowed by gods. Moreover, intuition gets better with practice – especially with a lot of practice – because at the bottom intuition is about the brain’s ability to pick up certain recurring patterns. These patterns, as Alden Hayashi explores in the Harvard Business Review article “When to Trust Your Gut,”70 draw upon existing pieces of inspiration, knowledge, skill, and insight that we gather over the course of our lives and help our understanding and judgement in both new and familiar situations. More recently, Malcolm Gladwell – in his best-selling book Blink71 – explored the power of the adaptive unconscious – pervasive, sophisticated mental processes that size up our worlds, set goals, and initiate action.

69

http://www.amazon.in/exec/obidos/ASIN/0465021387/petewill0e8-21 https://hbr.org/2001/02/when-to-trust-your-gut 71 http://www.amazon.in/Blink-Power-Thinking-Without/dp/0316010669 70

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If the human intuition can be astonishingly good, especially after it is improved by experience, then this trust in intuition is understandable, but as we explored in the foregoing chapter, “intuition” detached from rigorous analysis is a fickle and undependable guide; it is as likely to lead to disaster as to success. And while some have argued that intuition becomes more valuable in highly complex and changeable environments, the opposite is also true. The more options we have to evaluate, the more data we have to weigh, the more our instincts need to find an ally in the rigour of science. Science Art stands on the shoulders of craft, which means that to get to the art we must master the craft.

Robust recruiting is about trying to reduce the unknown variables in the hiring decisions and it is here that science can show us new ways in demystifying the process. This scientific way of thinking is at once imaginative and disciplined. While art allows us to explore an individual’s persona through a filter of human perceptions and emotions, science seeks out objective and verifiable truth. The science in hiring attempts to keep human limitations or prejudices from clouding the picture and offer an unbiased understanding of an individual’s reality. It aims for a predictive physical picture in seeking to understand complex processes by reducing them to their essential actions and studying the interplay of these actions (refer to exhibit below). The reductionist approach can help standardize many components in the hiring life-cycle. Making them uniform – through sequencing – minimizes the complexity that recruiters and hiring managers have to contend with, while ensuring a consistent, more predictable quality of hire.

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These standardized process components can also help provide rich data on the skills and competency mix of individual(s) in addition to ensuring a uniform hiring process. But without qualified human judgment, the challenge of finding talented prospects with a strong fit in a given job context would be far more difficult. As George Anders writes in The Rare Find, “Shut down experts’ intuitions drawn from personal notions of success – and Mary Schuler Cutler never gets offered a spot at John Hopkins. David Evans never welcomes the restless spirits at Utah who later helped create Pixar, the Apple Macintosh, Netscape, and Adobe. Dick Tildrow never urges the Giants to take a chance on the not-so-tall pitcher with the powerful fastball. Hiring becomes driven by a mechanical emphasis on credentials, formulas, and prior work history. Payrolls become filled with unobjectionable souls that are consistently a little above average.” There’s no room for talented folks who can help breathe new life into a place and help an organization navigate the choppy waters of globalization. Both the art and science are important to inform the discipline of hiring. Decoding the nuances and complexities of human behaviour lies at the core of the hiring process, and no matter how scientific the approach, it can provide only part of the story of an individual’s potential. Anthropologist Clifford Geertz72 posits that “all of our behaviors are imbued with socio-cultural significance.” Interpreting their meaning and the motivation behind them requires an intuitive understanding that comes from detailed observation of people’s interactions and their environments. We live today in a world befogged by a set of stereotypes about conflict and difference between these two great domains of human understanding. And, while their methods differ radically, both share the desire to investigate the ways the interlocking pieces of reality fit together. To rephrase a powerful quote by Leonard Shlain,73 “Art and Science, like wave and particle, are an integrated duality…two different but complementary facets of a single description of the hiring world.” It’s important to re-visit and embrace this sentiment, in which science is seen through the optic of the art, and the art is interpreted in the light of science for the hiring journey resembles more like the flight of a bumblebee than the seasonal migration of songbirds. 72

http://www.oxfordbibliographies.com/view/document/obo-9780199766567/obo9780199766567-0035.xml 73 https://www.brainpickings.org/2014/08/07/art-physics-leonard-shlain/

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Mapping this journey requires a nuanced understanding of the hiring flight path combining scientific rigour with the art of intuition. For it’s in the coming together of the two, that hiring can be made whole and organizations can hope to achieve the holy grail of excellence in hiring. I invite you to explore the principles and practices of hiring excellence through a tapestry of contemporary research finding and a real organization’s story.

PART II

THE COMPLEXITY OF TALENT

“I believe talent is like electricity,” said Maya Angelou. “We don’t understand electricity. We use it. You can plug into it and light up a lamp, keep a heart pump going, light a cathedral, or you can electrocute a person with it. Electricity will do all that. It makes no judgment. I think talent is like that.”

Maya Angelou may well have been suggesting to crack open the lockbox of talent. Is talent innate or cultivated? And which is more important genes or practice? Isn’t it true that whatever isn’t determined by our genes must be determined by our environment? There’s nature and there’s nurture. Is there also some X, some further contributor to what constitutes the talent construct? Few other questions have caused such intense debate, controversy and diversity of opinions. In recent years, a large body of research has accumulated that suggests that the origins of talent are extraordinarily complex. The word “talent” has myriad connotations, which makes it hard to fully understand and even harder to spot. Faced with this dilemma, many people approach understanding talent the way Justice Potter Stewart approached understanding pornography74 – they’ll claim to know it when they see it. In the following chapters, we take a peek at some of the perspectives from decades of research on the subject, which may help illuminate our understanding around this age-old quandary.

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CHAPTER SEVEN THE ETYMOLOGICAL HISTORY OF THE TERM “TALENT”

The term talent is everywhere. Asking for a clear definition, however, is like opening a can of worms. A profound ambiguity swirls around the word, which perpetually confuses the issue for anyone using it. And as GallardoGallardo et al. (2013) assert, “It appears that talent can mean whatever a business leader or writer wants it to mean, since everyone has his or her own idea of what the construct does or does not encompass.” One possible explanation for this conceptual ambiguity is the history of the word talent – considering the different meanings it has had throughout its existence of over a thousand years. To the ancient Hebrews, Greeks, and Romans, a talent was a unit of weight. Through exchange of precious metals of that weight, it became a unit of monetary value. What is today a key source of value creation was, thousands of years ago money. The term took on a broader meaning in the Parable of Talents in the Book of Matthew, which stressed that talent is a gift that must be cultivated, not left to languish. Since the New English Bible translates the Greek word talent into the word capital, this parable can be seen as one of the causes for HRM scholars using the term human capital as synonymous with talent. In the thirteenth century, talent was seen either as the feeling that makes a person want to do something (i.e., an inclination), or the natural qualities of a person’s character (i.e., a disposition). Similarly, in Old French talent was seen as will or desire. Although Hoad75 considers this latter definition of talent obsolete, this type of operationalization highlights the behavioural aspect of talent, which is becoming increasingly important again in today’s business environment. In the sixteenth century, theologian Martin Luther interpreted the parable to mean it is God’s will that people exercise their innate talents through hard work, thus forming the basis of the Protestant

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work ethic. By the nineteenth century, according to C. Tansley,76 “talent was viewed as embodied in the talented – hence, a person of talent or ability.” Here, we encounter for the first time a “subject” approach to talent – talent as people, rather than an “object” approach, which conceptualizes talent as characteristics of people. Over the course of the twentieth century some new terms arose. For instance, since the 1930s, “talent scout” (or spotter) has been used to designate a person searching for new talent.77 The emergence of this term might explain why up until today many people connect talent to sports or music. Another use of the term talent can be situated in the 1940s among British servicemen, who quite commonly used the term “local talent” to refer to the good-looking people of a certain area. In modern British English, talent is still used to refer to people regarded as sexually attractive. One might say that, even in this form, talent refers to the segmentation of the population in “haves” and “‘have-nots.” When looking up “talent” in contemporary English dictionaries, one meaning of the term refers to “mental endowment; natural ability.” The second meaning of talent found in contemporary English dictionaries refers to a person or persons of talent – talent as subject, i.e., people possessing special skills or abilities. In fact, it is common to see job advertisements in which talent refers to potential applicants (e.g. talent wanted). Likewise, organizations frequently refer to their workforce as the talent of the organization, so as to stress the fact that people are the organization’s most important assets. The meaning of talent, then, has grown in abstraction from a unit of weight to a unit of money to a person’s innate abilities to gifted people collectively. The subject approach to talent – which is historically “newer” than the object approach – coexists with the object approach. In what follows, we discuss the tensions between these two dominant approaches to the conceptualization of talent.

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7.1 Talent: Is it Nature or Nurture? – Object Approach “You are more than your genes. You are your connectome.” – Sebastian Seung, MIT Professor of Computational Neuroscience

Is talent some abstract, mythical power fixed at birth or an ability that can be created and nurtured? Is talent an outcome of a special twist of the DNA or a product of logging in a few more of those magical 10,000 hours? Or can it be understood as an emergent property, born out of tiny behavioural and motivational tornadoes, about which Daniel Coyle78 writes in “We’ve have been thinking about Talent the wrong way all along.”79 He further opines, “We’re at a very interesting moment in this discussion, where new science is giving us an X-ray of what lies beneath speed and fluency of great performances…A lot has to do with genes, but more doesn’t.” Nature vs Nurture. It’s an age-old debate around talent that neither scientists nor scholars have been able to resolve. The debate of “nature” and “nurture” as separate or joint forces that drive human development in general and the maturation of mind in particular is an issue that has evoked and still evokes strong opinions. There are extreme positions on both ends and multiple positions along the continuum that adopt elements from each extreme. The persistence of this debate in many ways is analogous to the physicists persisting in their old arguments over whether light is a wave or a particle. We now know that light has both properties, and that even particles have wave attributes. Hence, physicists now concern themselves with just the conditions that govern the wave and particle aspects of light. This should logically present the way forward for researchers to explore the talent concept by studying the complex interplay between nature and nurture and not to be drawn too much into the nature-nurture dichotomy. The discussions and the research findings presented in this chapter demonstrate that the talent concept is far more nuanced, complex, and fascinating than any one viewpoint or paradigm can possibly reveal. If anything, they paint a broad brush stroke on the origin and manifestations of talent across domains. The chapters to follow offer a discussion on the rationale for integrating nature and nurture in the study of the “talent construct” by looking at all parts of the rationale: nature, nurture, and nature-nurture.

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7.1.1 Talent as a Natural Ability Call in the inspired bard Demodocus. God has given the man the gift of song.

That’s one of the many God-given gifts of characters in The Odyssey80 and typifies: that the awesomely great, apparently superhuman performers around us came into this world with a gift of doing exactly what they ended up doing – in the case of Demodocus, composing and singing. Twenty-six hundred years later we still think what Homer thought: that great performers are inspired, meaning that their greatness was breathed into them by gods or muses. Many scholars and practitioners seem to believe that talent is innate, at least to some extent, and that it is a rare and mysterious gift bequeathed to a lucky few, for reasons no one can explain, by someone or something apart from themselves. Lending credence to these views is a raft of empirical research81 in both behavioural genetics and differential psychology which has conclusively identified sets of abilities and traits that feature both substantial heritability coefficient and sizeable predictable validities. Noted psychologist Howard Gardner, writing on the nature of talent82, reflects: “Anyone who has the opportunity to observe or read about a prodigy – be it Mozart or Yo-Yo-Ma in music, Tiger Woods in golf, John von Neumann in mathematics – knows that achievement is not just hard work.” Their prodigious talent begs for a reassuring explanation: They were born with something we weren’t born with. They are gifted. Dean Simonton, professor of psychology at the University of California, Davis, who has studied this area83 for many years, argues that “genetics influence how quickly and how well a person can master the expertise necessary to perform at world class levels.” While, for example, we may not inherit a music or a writing gene, Professor Simonton said, our openness to experience is partly attributed to genetic influence, and “that trait is correlated with achievement in all domains that require exceptional creativity.”

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So what’s the point of this? That it is awfully hard to become great at something? We probably all know that, posits Alina Tugend, in her piece84 for The New York Times titled “For the Best of the Best, Determination Outweighs Nature and Nurture”: “And the reality is that most of us are not going to be Picassos or Shakespeares. But these concepts are still important. Because even if we give lip service to the idea that hard work will make us better, it is awfully hard to overcome the belief that we’re born a certain way and there’s not much we can do about it.” A Voice for Nature In recent years, perhaps nobody has explored the notion of human nature with more lucidity and insight than the renowned MIT linguist Steven Pinker. In The Blank Slate: The Modern Denial of Human Nature,85 he rekindles the nature vs nurture debate as he synthesizes research in language, cognitive science and evolutionary psychology to produce a theory of human nature that repudiates long-standing doctrines. Pinker argues that the role of nurture is overestimated and that heredity plays a more dominant role than many behaviourists of the last century have asserted. A principal theme86 of Dr. Pinker’s assertion is that the “blank slaters” – the critics of sociobiology and their many adherents in the social sciences – have sought to base the political ideals of equal rights and equal opportunities on a false biological premise: that all human minds are equal, equally free of innate, genetically shaped, abilities and behaviours. “The politics and the science must be disentangled,” Dr Pinker argues. “Equal rights and equal opportunities are moral principles, he says, not empirical hypotheses about human nature, and they do not require a biological justification, especially not a false one.” Pinker shows the importance of an honest acknowledgement of human nature based on science and common sense and provides evidence that some universal human social behaviours and faculties are innate, and presumably shaped in part by the genes. Here’s a scientific datum: Talent is “born” (at least in part).

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7.1.2 Talent as Mastery “I have always maintained that excepting fools, men did not differ much in intellect, only in zeal and hard work.” – Charles Darwin

In contrast to the nature approach, this view confronts the idea that innate talent is merely a myth – at its heart is a much bigger question about the boundaries of our capacity for transformation realized through a focus on deliberate practice and learning from experience. It is a question that calls to mind Friedrich Nietzsche’s insightful musing from his 1878 book, Human, All Too Human,87 where he described greatness as being steeped in a process: Do not talk about giftedness, inborn talents! One can name great men of all kinds who were very little gifted. They acquired greatness, became ‘geniuses’, through qualities the lack of which no one who knew what they were would boast of: they all possessed that seriousness of the efficient workman which first learns to construct the parts properly before it ventures to fashion a great whole; they allowed themselves time for it, because they took more pleasure in making the little, secondary things well than in the effect of a dazzling whole. For the last two centuries, behavioural scientists have studied that question through focused research on great performers of all types. The studies conclusively disproved the notion that great performance stems primarily from a natural “gift” or talent. While some people display innate talents for activities early on, amazingly average people have become champions in all manner of endeavours. Many such top performers overcame their average – or even below-average intellects and nonexistent aptitudes to develop outstanding abilities in disciplines such as chess, music, business, and medicine.

Examples of such remarkable transformations abound throughout history. Henry Ford failed in business several times and was flat broke five times before he founded the Ford Motor Company. In his youth, Thomas Edison’s teachers told him he was “too stupid to learn anything.” Beethoven was so awkward on the violin that his teachers believed him hopeless as a composer. How do we explain such unintuitive findings? Research in the science of talent shows that talent and practice are far more intertwined than originally thought. While many theories have been put forth, there is one common factor that researchers recognized in all great performers: they practiced so hard and intensely that it hurt. 87

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Studies of people with extraordinary abilities as manifested in the work of psychologist K. Anders Ericsson, whose findings paved the way for the 10,000-hour rule – that this level of practice holds the secret to great success in any field – makes for an equally compelling case for the transformative power of deliberate practice. Ericsson and his fellow colleagues found that the depth and breadth of expertise is typically acquired through 10 years of deliberate practice,88 where a motivated individual constantly strives to learn from feedback, and engages in targeted exercises provided by a supportive, knowledgeable mentor to push beyond his or her limits. Expert performance researchers have investigated this “10-year rule” of expertise acquisition in a wide range of fields, including medicine, professional writing, music, art , mathematics, physics, and sports. Ericsson’s work, sitting on a raft of similar studies,89 does not suggest that every person has the same resources and opportunity, or that anyone can be great at anything; biological and circumstantial differences and advantages or disadvantages abound. But the presented evidence does debunk the myth that talent is a special gift serendipitously bestowed upon the chosen few and shows, instead, that it is the product of consistent, concentrated effort, applied in the direction of one’s natural inclination. Here is another scientific datum: Talent is “nurtured” (at least in part).

The foregoing offered a view that talent is both innate and cultivated – a function of both nature and nurture. Yet this does not enable a complete view of the talent construct as it tries to separate the two causes. Nature and nurture do not always operate in isolation of one another. Instead, very often they will interact in complex ways over the course of the development of talent, which is not a thing; but a process. For instance, many so called environmental influences can become inextricable entangled with genetic influences. What appear to be examples of nature could in fact be examples of nature operating incognito as researched by psychology professors, Sandra Scarr and Kathleen McCartney,90 in their work on behavioural development. “There are no genetic factors that can be studied independently of the environment,” explains McGill University’s Michael Meaney, one of the world’s leading experts on genes and development. “And there are

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no environmental factors that function independently of the genome. A trait emerges only from the interaction of gene and environment.” In The Genius in All of Us, David Shenk presents a rigorously researched blend of historical evidence and scientific data to debunk the myth that it is our genes that makes us who we are, and that everything that happens after birth builds on that basic blueprint. “We’re jukeboxes,” he says. “Our genes don’t program us to play just one tune; and it’s what happens after birth that picks the record.” This interaction between our heredity and our world helps us to incorporate empirical findings – such as the fact that most individual variances that predict talent also feature substantial heritability coefficients. The hard evidence will not just go away simply because they are inconvenient for an extreme nurture-purist. This new paradigm does not herald a simple shift from “nature” to “nurture.” Instead, it reveals how bankrupt the phrase “nature versus nurture” really is and demands a whole new consideration of how each of us becomes us. “It’s a scientific idea ready for retirement,” argues Timo Hannay in his seminal article91 on nature versus nurture. He further writes: The most elementary error that people make in interpreting the effects of genes versus those of the environment is to assume that you can truly separate one from the other. Donald Hebb, the brilliant Canadian neuropsychologist, when asked whether nature or nurture contribute more to the human personality, reportedly said, “Which contributes more to the area of rectangle, its length or its width?” Unfortunately, the view only reinforced the highly misleading idea that genetics and environment are orthogonal concepts, like Newtonian space and time. In fact they are more like Einsteinian space-time: deeply inter-wined and with complex interactions that give rise to counterintuitive results. Sebastian Seung,92 a dynamic professor at MIT, proposes a new model for understanding the totality of self-hood, one based on the emerging science of connectomics – a kind of neuroscience of the future that seeks to map and understand the brain much like the genomics has mapped the genome. The connectome,93 as it is called, is where our genetic inheritance intersects with our life experience. It is where nature meets nurture. Our

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genome may determine our eye colour and even aspects of our personality. But our friendships, failures, and passions also shape who we are. As evolution expert Matt Ridley demonstrates in Nature Via Nurture,94 “Nature and nurture are not mutually antagonistic forces but harmonious collaborators which are joined together to awesomely inventive ends, resulting in species as varied as yeast and blue whales, and even within our own species, the wondrous variety of individuals that make up Homo sapiens, from the Scandinavian to the Inuit.” Genes are not our hard-wired masters, he concludes, but “the epitome of sensitivity, the means by which creatures can be flexible; the very servants of experience.” The clearest conclusion that emerges in the object “view” of talent is that development of high achievement and by its extension an orientation towards excellence involves a complex interaction of many personal and environmental variables that feed off each other in non-linear, mutually reinforcing ways, and that the most complete understanding of the talent construct can only be arrived through an integration of perspectives. Indeed, nature and nurture are both intimately intertwined in the generation of talent. 7.2 Talent as People – Subject Approach Within the subject approach, we find both inclusive (i.e., talent understood as all employees of an organization), and exclusive approaches to talent (i.e., talent understood as an elite subset of an organization’s population). According to the inclusive approach, every employee has his or her strengths and thus, can potentially create added value for an organization. The approach captures the Maslowian ideal that people have an in-built need to self-actualize as a route to happiness brought about by the realization of their full potential. Despite being quite vague, the inclusive approach is commonly justified in literature using the argument that in knowledgebased economies, companies cannot achieve profits (or succeed otherwise) without their people. An inclusive definition of talent is typically found in strength-based approaches to talent management – i.e., “the art of recognizing where each employee’s areas of natural talent lie, and figuring out how to help each employee develop the job – specific skills and knowledge to turn these talents into real performance.” Inclusive strength-based approaches to talent are believed to benefit from what is called the “Mark Effect” – i.e., by treating everyone in the organization as equals, a more pleasant, collegial,

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and motivating work climate is created. The approach guarantees an egalitarian distribution of resources across all employees in an organization rather than a focus on a small subset of elite performers. In stark contrast to the inclusive approach of talent, the exclusive approach is based on the notion of segmentation of the workforce, and understands talent as an elite subset of the organization’s population – individuals who can make a difference to the organizational performance, either through their immediate contribution or in the longer-term by demonstrating the highest levels of potential.95 More often than not, the subject approach to talent equates the term talent to high performers. According to Smart (2005),96 high performers are the single most important driver of organizational performance, since they “contribute more, work smarter, earn more trust… and find ways to get the job done in less time and at less cost.” Advocates of Topgrading97 argue that the best way to outperform competitors is to hire top performers at all levels in the organization. Some authors operationalize talent as a select group of employees who demonstrate high levels of potential. This approach suggests that high potential employees have the qualities (e.g., characteristics, motivation, skills, abilities, and experiences) to effectively perform and contribute in broader or different role in the organization at some point in the future.98 Specifically, this exclusive approach to talent benefits from what is called the “Mathew Effect” – whereby the allocation of more resources to better performers and high potentials in the organization leads to higher return on investment. The idea is that in any setting where a little experience or recognition matters, those with early advantage will increasingly be privileged over time, that resources accumulate to those who have these early advantages, even if those early advantages might have been randomly assigned. Either way, both the high performer and high potential approach to talent imply exclusiveness and notwithstanding the appeal of the inclusive approach to talent management practices, more arguments are found in literature in favour of the exclusive approach, in that it leads to a high-

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Tansley C., Turner P., Carley F., et al. Talent: Strategy, management, measurement. (London: Chartered Institute of Personnel and Development (CIPD), 2007). 96 Smart B. D. Topgrading: How leading companies win by hiring, coaching, and keeping the best people (Rev. ed.) (New York: Portfolio (Penguin Group), 2005). 97 http://www.amazon.in/Topgrading-Hire-Coach-Keep-Players/dp/094400234X 98 Silzer R. and Church A.H. “The pearls and perils of identifying potential,” Industrial and Organizational Psychology, vol. 2 (2010), pp. 377–412.

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performing workforce. However, literature also identifies a number of critiques on the exclusive approach, the most prominent, that it leads to self-fulfilling prophecies such as the Pygmalion effect – whereby expectations of performance (high or low) determine actual performance (in a positive or negative way). As Goethe said, “Treat a man as he is and he will remain as he is. Treat a man as he can and should be and he will become as he can and should be.” To illustrate this umbrella idea, I am motivated to remind the reader of a movie from 1983 – Trading Places. This well- known movie starred Eddie Murphy as originally a fraud and a beggar and Dan Aykroyd as a successful pedigreed investment banker. The movie shows Aykroyd’s character’s uncle having a bet that they could, if they wanted, turn Murphy’s character into essentially the Aykroyd character, and vice versa. That if they simply treat the Murphy character different, they could elevate him from the streets of New York into a well-heeled investment banker. And conversely, if they treated Dan Aykroyd’s character differently, they would turn him in, given a little time, to someone essentially as pitiful as the Eddie Murphy character. If you’ve seen the movie you know that they pulled this off quite successfully for a while. And that’s the main point here: that we have a profound impact on those who we work around and who work for us by what we expect of them. And what the psychologists have documented over time is that people respond to these expectations; that people tend toward performing consistent with expectations. High expectations increase performance. Low expectations decrease performance. This occurs for one of two main reasons. One is that we tend to treat people differently when we have high expectations for them or low expectations. So we might actually put them in different situations, not unlike what Dan Aykroyd’s character’s uncle did in Trading Places. Another mechanism by which self-fulfilling prophecies work is that merely having our expectations voiced can change the other person’s behaviour. I will give an example from literature which explores the notion that the way one person treats the other can, for better or worse, be transforming. In George Bernard Shaw’s Pygmalion, Eliza Doolittle explains: “You see, really and truly, apart from the things anyone can pick up (the dressing and the proper way of speaking, and so on), the difference between a lady and a flower girl is not how she behaves but how she’s treated. I shall always be a flower girl to Professor Higgins because he always treats me as a flower girl and always will; but I know I can be a lady to you because you always treat me as a lady and always will.”

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Unfortunately most managers, like Professor Higgins, unintentionally treat their subordinates in a way that leads to lower performance than they are capable of achieving.99 This powerful influence of one person’s expectations on another’s behaviour has long been recognized by behavioural scientists but their importance on how they impinge on people practices, processes and programs in an organization setting is only now beginning to be understood. For instance, a hiring manager’s pre-interview evaluations of applicants may be self-fulfilling. These self-fulfilling effects are mediated by both the tendency of the interviewers to convey their opinions of the interviewee in their conduct of the interview and their tendency to notice, recall, and interpret information in a manner that is consistent with preinterview evaluations. Right away, this raises a few questions: • Where might be our expectations be affecting other people’s behaviours, or our evaluation of their behaviour? • Where are our expectations getting involved in the process? • What specific steps can we take to protect the evaluation processes from these expectations? • How can we provide equal access to valuable resources? [Mathew Effect] It is important that these aspects be given due cognizance, otherwise, we are going to be drawing inferences about talent, skill, and effort because of the Pygmalion effect or the Mathew effect, and not because of an individual’s underlying skill, talent, or effort. Putting It All Together These perspectives hold important lessons for organizations looking to write or rewrite their talent code when drawing up their hiring process algorithm. First, there are a number of factors that are changing the availability and characteristics of talent available today and in the foreseeable future. There are still substantial gaps in our understanding, practical and theoretical, of the dynamics and interplays between the changing characteristics of the environment, the workforce, and individual and organizational outcomes. Second, “It can help organizations think broadly and clearly about context,” as noted journalist George Anders wrote in his book The Rare Find, “and avoid the perils of superficiality and narrowness, in laying down their talent-hunting frameworks.” Context should be the first consideration when a decision to hire is made. At a minimum, context analysis ensures a measure of objectivity to a hiring process. It puts an array of factors on

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the analytical table for scrutiny and in the process improves the overall situational assessment and the efficacy of the hiring decision. Third, implicit beliefs held by organization decision makers about the degree to which individual characteristics are fixed as opposed to malleable, have repeatedly been demonstrated to have a very strong impact on their assessments of talent. The assumption that talent is fixed is dangerous, because theories of performance and abilities become self-fulfilling prophecies. Based on their research,100 Pfeffer and Sutton assert that “… despite claims in the The War for Talent, Topgrading, and numerous other books on hiring the best people, the talent mindset at many organizations is rooted in a set of assumptions and empirical evidence that is incomplete, misleading and downright wrong. If you believe that only 10% or 20% of your people can ever be top performers, and use forced rankings to communicate such expectations in your company, then only those anointed few will probably achieve superior performance.” Great systems are often more important than great people. As Malcolm Gladwell wrote in his piece for The New Yorker, in the wake of the Enron’s 2001 meltdown: “The broader failing of McKinsey and its acolytes at Enron is their assumption that an organization’s intelligence is simply a function of the intelligence of its employees. In a way, that’s understandable, because our lives are so obviously enriched by individual brilliance. Groups don’t write great novels, and a committee didn’t come up with the theory of relativity. But companies work by different rules. They don’t just create; they execute and compete and coordinate the efforts of many different people, and the organizations that are most successful at that task are the ones where the system is the star.”101 People’s performance depends on the resources they have to work with, including the help they get from their colleagues and the infrastructure that supports their work. The talent myth assumes that people make organizations smart. More often than not, it’s the other way round. Even the most brilliant person is doomed to fail in a bad system, and seemingly mediocre people can become stars in a great system. Fourth, finding the right talent, at the right time, and in the right place, remains an ongoing challenge for organizations, particularly in these uncertain economic times. Work is also becoming increasingly relational, rather than transactional, and an individual’s abilities to build and sustain

100 Pfeffer J. and Sutton R.. Hard facts, dangerous half-truths, and total nonsense: profiting from evidence-based management. (Boston, MA: Harvard Business School Press, 2006). 101 http://www.newyorker.com/magazine/2002/07/22/the-talent-myth

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relationships, as well as the organization’s ability to build systems and processes to maximize those relationships for business performance will be critical to competitive success. Employers and educational institutions will need to restructure their organizations, jobs and revamp policies and procedures to attract, develop and effectively manage and engage employees for complex and relationship-driven work. Fifth, organizations cannot continue to discuss or attempt to address “talent issues” in a vacuum. As discussed earlier, context matters. Organization culture plays a particularly important role in unleashing or constraining the talent of individuals, and the fit between individuals, organization strategy, tasks, structure and processes, as well as the culture are all critical in “winning” the global war for talent and sustaining organizational competitiveness.102 As Laszlo Bock writes in Work Rules103: “Superb hiring isn’t just about recruiting the biggest name, top sales-person, or cleverest engineer. It’s about finding the very best people who will be successful in the context of your organization, and who will make everyone around them more successful.” We are living in an age of complexity where people are increasingly being marked by their unusual life stories and unconventional work pathways. Both the nature-nurture distinction and the subject approach to talent are critical to our understanding of the talent construct and the way we go about competing for talent. They can inform each other in that the object approach specifies which personal characteristics to look for in identification of talent, whereas the subject approach provokes important discussions about cut-offs and norms. This appreciation becomes critical especially when a jagged-resume enters the picture. He may not have the perfect credentials but may yet turn out to be the best hire empowered with the grit to persist in an ever-changing workplace. As the iconic ad-man David Ogilvy asserted, “It sometimes pays to be imaginative and unorthodox in hiring.” He himself joined the industry as a copywriter at age 39, after stints working as a cook, a salesman, a diplomatist, and a farmer. He went on to become the most famous copywriter in the world. We stand at the gateway of a new era of talent selection, where more than performance and competencies, identifying a candidates potential would be key to lasting success in a fast changing, globalized world. He

102 Chatman J. and Eunyoung C.S. “Leading by leveraging culture,” California Management Review, vol. 45 (2003), no. 4, pp. 20–33. 103 https://www.amazon.com/Work-Rules-Insights-Inside-Transform/dp/ 1444792385/ref=tmm_pap_swatch_0?_encoding=UTF8&qid=&sr=

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may be someone whose job history differs from the norm, but bring such candidates into play, and you unravel talents of trust, gusto, and moxie under pressure. “Most of us are far from our potential,” says Angela Duckworth, an assistant professor of psychology at the University of Pennsylvania. “The prevailing wisdom, for much of the last century, has been that talent is the most important determinant of achievement. Our focus in the next millennium is turning to all those things that unlock talent, including grit, self-discipline, and confidence.” Versatility can be a huge asset.

PART III THE CHANGING TALENT LANDSCAPE

The ability to respond to, predict and operate in today’s era of constant change, presents us with one of society’s most vexing challenges. At the centre of this vortex is finding the right talent needed to successfully navigate within what is this “new normal.” Hiring leaders in the new global order must display the ability to master the changing complexities while orchestrating hiring processes that ignore the essentialist thinking about people’s abilities at the expense of context. Humans aren’t fixed entities. Nor are we simple average abstractions. This section takes the opportunity to pause and make an honest assessment of our understanding of the talent landscape. Companies always lament there’s a shortage of talent, that there’s a skills gap. The reality as it turns out is that there may not be a skills gap, but rather a thinking gap104 on what the talent construct looks like. In the new world disorder, the old paradigms of hiring talent may no longer hold.

104

http://louadlergroup.com/hr-has-a-thinking-gap-when-it-comes-to-hiring/

CHAPTER EIGHT THE NEW TALENT ECONOMY: A MACRO VIEW

“A rising tide lifts all boats.” – John F. Kennedy

As the world economy continues in its struggle to move ahead from the backyards of recent financial meltdown, dramatic changes fuelled by technology, globalization, demographics and shrinking talent pipelines are forcing businesses to strategically adapt to new ways to fill talent scarcity gaps. Given the recessionary climate and talent imbalances in the world, organizations today are getting innovative in the way they are engaging with talent. There is increasing realization that being more innovative in sourcing and recruiting can give them a sustainable competitive advantage by finding and hiring more of the right people who can drive innovation throughout the organization. While the VUCA environment we find ourselves in has changed the global business landscape, the forces that drive talent acquisition remain in

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place. Companies must continue to rely on talent as a core foundation for growth and productivity. At the same time, the need for advanced, specialized talent and leadership will continue to provide challenges for enterprise recruiting efforts. The structural labour shortage worldwide is changing the way CEO’s think about the management of Talent and “Strategic Talent Acquisition” is being seen as the talent management practice with the maximum impact on the organization bottom-line and growth. Hiring is a powerful way in which employers shape labour market outcomes. As an entry point to occupations and income brackets, hiring is a critical site of economic stratification and social closure. Its real importance as a door-opener for talent management at the proverbial seat at the boardroom table is the recognition that a business cannot grow without the right talent. Just as importantly, businesses cannot reach the right talent without making a conscious strategic effort to do so. As the global economy expanded dramatically between 2002 and 2007, business leaders and human resource managers worried about the intensifying international competition for talent; the impact of not having the right people in place to lead and confront business challenges; as well as employing below-average candidates “just to fill positions” (Economist, October 2006; Price & Turnbull, 2007).105 Reflecting these concerns, Price Waterhouse Cooper’s 11th Annual Global Survey 2008 showed that 89 percent of the CEOs surveyed put the “people agenda” as one of their top priorities (PWC, 2008a, b: 35).106 M/s Boris Groysberg, Nitin Nohria, and Claudio Araoz in their seminal report, The definitive guide to recruiting in good times and bad,107averred that the “Future success of a vast majority of companies would depend on a complete overhaul of their recruitment practices. We need a culture of professional recruitment and retention, in good and bad times, especially in bad ones.” E&Y in its 2008 “Global HR Risk Survey” findings concluded that Talent acquisition and management was seen as the HR risk considered to have the greatest impact on the organization and the most likely to occur. Justifiably so the last few years has seen an incredible shift in how organizations source and hire for talent. The life-cycle-supply chain view of talent is giving way to an ecosystem view that requires a fresh

105 The Economist, 2006, Survey on Talent. ”The Economist” from http://www. economist.com. 106 Price Waterhouse Coopers. “The 11th Annual Global CEO Survey, PWC.” (New York, September, 2008a). 107 https://hbr.org/2009/05/the-definitive-guide-to-recruiting-in-good-times-and-bad

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perspective on the foundation or scaffolding on which to build and manage talent acquisition networks. The recruiting methodologies and approaches that businesses used in the past are being replaced by new set of principles directed more towards navigating and managing talent ecosystems. The exhibit below captures some key elements of the Talent Acquisition framework gaining foothold in the lexicon of Talent decision makers.

We are today living in an age of global connectivity. Using Ulrich’s108 terms, the talent war represents the drive to find, develop, and retain individuals, wherever they are located in the world.

108

Ulrich D. “The Talent Trifecta,” Workforce Management, September 10, 2007, pp. 32–33.

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However, as global consumer and talent markets grow increasingly interconnected, we are seeing new patterns and priorities emerge in this “war for talent.” With business leaders grappling with multiple generations, new concerns are moving from the periphery to the centre of talent concerns. We are seeing the desires of the younger workers (millennials) and older workers (boomers) to connect their social concerns to their work and companies. Today’s younger, connected, and globally mobile people are managing their careers on their own terms. There is a growing employee focus on the meaning and social impact of their work, professional development, and opportunities to attain greater levels of responsibility and challenge. Change, Change, and More Change We are living in a world that is slowly being revealed. Claudia Chan, founder of S.H.E Globl Media,109 says employees are now starting to ask themselves: “What do I want to create that is going to fill a white space? What doesn’t exist that needs to exist? There is a hole and they want to fill it. There is a problem, and they want to solve it.” This isn’t employees trying to do better at their existing jobs or move up the ladder; this is them wanting to create something new that doesn’t currently exist.

109

https://www.fastcompany.com/3035633/strong-female-lead/the-entrepreneuron-a-mission-to-change-womens-media

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In The Shift: The Future of Work is Already Here,110 Lynda Gratton, professor at London Business School, presents a sweeping overview of the trends reshaping work, jobs, and careers. Without being ridiculously positive and Pollyannaish, she paints an uplifting view of a future, where the nexus of technology and globalization will work together with demographic, societal changes, and the needs of a low carbon economy to fundamentally transform much of what we take for granted about work. Of course some aspects of the work will remain the same; one of the challenges, in fact, is actually to know what will remain stable. As the science fiction writer William Gibson famously remarked, “the future is here – just unevenly distributed.” Gratton also presents a useful frame for different views of the future: the default future and the crafted future. This is an important idea both for organizations and their leaders and for individuals. She suggests that the default future is the direction we are headed if we follow current trends and trajectories. A future where technological progress eliminates the need for many types of jobs leaving the typical worker worse off than before. This default future is one of isolation, fragmentation, exclusion, and narcissism, where no one works together. Gratton then pulls out of this nosedive of misery to what she calls the crafted future where technology and globalization are leveraged to develop new network of collaborators. In this vision the future of work will be less about general skills and more about in-depth mastery; less about working as a competitive, isolated individual and more about working together in a joined world; and less about focusing solely on a standard of living and more on the quality of experiences. Another way to understand this shift is to think about the image created by Dick Bowles, author of the book The Three Boxes of Life.

110

http://www.amazon.com/The-Shift-Future-Work-Already/dp/0007427956

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Today, unlike the past, the work life cycle less resembles a linear pattern – education, work, and retirement – and more a “cyclic lifeplan,” with periods of education, work, and recreation overlapped and interspersed across a lifetime. These shifts challenge standardized career paths, development programs and incentive systems. Employee consumerism is rising, especially for those with in-demand skills and experience. These people are more informed about employment options, opportunities, and markets, thus intensifying competition for finding and hiring top talent.111 A New Talent Agenda The emerging shifts and challenges in the global talent market suggest the need to reframe a new talent agenda. For organizations considering how to redefine and refresh their talent agenda, this advocates that several time-honoured paths to talent acquisition will need to be revisited and perhaps reinvented. “Many of the current business models and thinking evoke warfare history and have a bias towards ‘killing off the competition’ and pitting ‘us’ against ‘them’ (Sutherland and Stavros, 2003).”112 The “war for talent” is a classic case of this competitive framing that belies a mindset dominated by scarcity, competition, and fear. Deeply held yet unexamined ideologies and mental models such as these can drive business practices, including talent acquisition. These mental models resist disconfirming evidence and persist in affecting judgments and choice, regardless of whether or not they are true. For instance, while there may be little evidence of links between a “star-focused” approach and individual or organizational performance, beliefs based on ideology and cultural values are quite “sticky” (Pfeffer and Sutton, 2006).113

111

Potter E. Part I: Changing workforce demographics and management challenges (2005). 112 Sutherland J. and Stavros, J.. “The heart of appreciative strategy.” From http:// appreciativeinquiry.case.edu/practice/executiveDetail.cfm?coid=5265, (November 1, 2003). 113 Pfeffer J. and Sutton R.. Hard facts, dangerous half-truths, and total nonsense: profiting from evidence-based management. (Boston, MA: Harvard Business School Press, 2006).

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The figure below delineates the talent response dimensions114 being embraced by forward thinking organizations in the new talent ecosystem, where the “war for talent” is largely asymmetric.

These response dimensions underscore the pivotal role Talent Acquisition plays in providing a foundation for all Talent Management practices. Optimizing the discipline can pave the way for a positive impact across the talent management continuum from workforce planning to performance management, learning and development, succession planning and compensation management. Most of all, in today’s semantic economy,115 it’s not the resources you own that are important, but what resources you can access and that’s especially true of talent. Corporate culture is still important, but you also need to have a company mission that is compelling enough that others want

114

Beechler S.L. and Woodward I.C. “The Global War for Talent.” Journal of International Management. Fox School of Business, Temple University. 115 http://www.digitaltonto.com/2012/the-semantic-economy/

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to contribute to it. The challenge for businesses here is to move away from the competitive winner or loser mentality inherent in the language and the tactical outlook of the global war for talent and embrace a more evolutionary paradigm where talent solutions are creative. This should incorporate a global mindset for people and organizations; evidence-based management; learning agility; broader and deeper approaches to talent management as well as capacity to leverage diversity. Innovative and integrated processes, systems, culture and partnerships should be the bedrock elements of the new paradigm. Moving ahead from the “big picture” view the sections below map the rapidly shifting contours of the recruiting function in the changing talent economy and the evolving role and skill set of the modern recruiter in this passage of change.

CHAPTER NINE TWENTY-FIRST CENTURY RECRUITING: FROM TRANSACTION TO TRANSFORMATION

Recruitment today is finally moving away from transactional thinking and beginning to understand how to better connect and engage with talent. Before delving into the meat of this chapter, I would like to take the reader back through the passage of time, a period of over 70 years, which has seen the recruiting function evolve to its present form of talent acquisition as we know it today. Recruiting began with the military and dates all the way back to ancient Egypt, Greece, and Rome.

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The birth of the modern recruiting industry,116however, did not take place until the 1940s around the time of World War II, when gaps in the labour force were created by drafted and volunteer soldiers and then filled by individuals who did not meet the service criteria. Over the past few years the phrase talent acquisition has become mainstream and embraced by both small and large organizations. Organizations today are beginning to understand, that when it comes to acquiring talent a broad end-to-end focus is needed; one that stretches from building a strategic employment brand, through sourcing and recruiting, all the way to on-boarding new hires. It’s a new way of thinking influenced by the increasing complexity and the growing strategic importance of recruitment at many organizations. The figure below captures the evolutionary phases, each with its distinct characteristics. Evolution of Talent Acquisition

The evolutionary phases in many ways mirror the changing nature of work and workforce, where the classical employment model is giving way to a new approach: the open talent economy. Authors, Jeff Schwartz, Lisa

116

“History of Recruitment,” N.D. Infographic. biipmi.com. Web. 28 June 2013. http:// issuu.com/biipmi/docs/history_of_recruitment_by_biipmi?e=5480272/1232290

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Berry, and Andrew Liakopoulos, in their seminal paper117 outline the salient aspects of this new economy, which more resembles a web of highly orchestrated networks and ecosystems with a multitude of approaches to mobilizing, orchestrating, and engaging talent, skills, leaders, and ideas. The evolving workforce in this new talent economy is a portfolio of full-time employees, contract, and freelance talent, and increasingly, talent with no formal ties to a company118: • Balance sheet talent: Full-time statutory employees of an organization. The employing organization bears all the carrying and development costs for these employees. • Partnership talent: Employees who are part of a partnership or joint venture and are on a related balance sheet (whereby an organization has some equity or ownership stake in a related entity). • Borrowed talent: Employees who are directly part of an organization’s extended value chain but who reside on someone else’s balance sheet, such as contractors who work in support roles, outsourced call centres, or manufacturing. • Freelance talent: Independent workers hired for specific but temporary projects. Workers are hired by the hour, the day, or the project, and they are typically integrated with and working alongside balance sheet talent. • Open-source talent: People who provide services for free or who provide paid services as part of a Web community or marketplace. Examples include volunteer crowdsourcing and the paid crowd work industry. These workers can be anywhere in the world and generally work outside of an organization, separate from the balance sheet talent. Accessing these disparate talent pools will require organizations to forge a new talent agenda which recognizes that corporate boundaries are not the end of their talent acquisition challenge. It would require pushing the boundaries of talent acquisition to include new models of employment and new types of relationships for accessing skills and ideas. We next take a peek into some key themes, opportunities and emerging practices around recruiting that are moulding its present and will continue to shape its future character. The themes of technology, social, mobile, and analytics are increasingly common ways of framing the forces driving business models in multiple realms. From a talent acquisition perspective, these post-digital trends, combined with the larger forces of globalization and changing demographics, are reshaping what is relevant and possible for 117 118

http://dupress.com/articles/the-open-talent-economy/ Ibid.

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human resources and talent acquisition executives planning for the future. Understanding these forces and their potential impact, and the opportunities they present for business and talent strategies, would require a broadening of the traditional approaches to attract and access different pools of talent. As Billy Joy, one of the co-founders of Sun Microsystems, famously remarked: “There are always more smart people outside your organization than within it.” This is one way to summarize the challenge for business, HR, and talent leaders as we chart the next generation of talent strategies and systems in the new talent economy.

9.1 Talent Spotting “The only thing worse than being blind, is having sight, but no vision.” – Hellen Keller

Ambiguity and uncertainty are par for the course in today’s business environment. An environment where corporations are amorphous, which is an intentional lack of structure that supposedly allows the company to change to meet market needs. Globalization, Demographics, and Pipelines – the other GDP as leadership hiring expert Claudio Fernandez Araoz likes to call them – are the key forces shaping the new business habitat where talent will become even scarcer in the years to come. Taken independently, globalization, demographics, and pipelines would create unprecedented demand for talent over the next decade. Combine all these forces, and we get a war for talent that will present a huge, perhaps insurmountable, challenge for most organizations – Finding the Right Talent. In his ground-breaking book, It’s Not the How or the What but the Who, Claudio Fernández-Aráoz succinctly traces the shifting paradigms of “Talent Spotting,” from the era of focus on “physical attributes” to the “competency and skills” movement we see today. He further argues that in the VUCA environment of today, competencybased appraisals and appointments are increasingly insufficient and organizations must navigate to a new era of “Talent Spotting” – one in which

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our evaluations of one another are based not on brawn, brains, experience or competencies, but on potential. Geopolitics, business, industries, and jobs are changing so rapidly that we can’t predict the competencies needed to succeed even a few years out.119 Our present-day methods of spotting and assessing talent come up woefully short of sketching a clear portrait of an individual talent and ultimately fail at measuring our potential. Todd Rose, a professor at Harvard’s Graduate School of Education, in his book, The End of Average,120 compellingly argues this fact, when he writes, “The Age of Average – a cultural era stretching from Quetelet’s invention of social physics121 in the 1840s until today – can be characterized by two assumptions unconsciously shared by almost every member of society: Adolphe Quetelet’s idea of the average man122 and Sir Francis Galton’s idea of rank.123 We have come to believe, like Quetelet, that the average is a reliable index of normality, particularly when it comes to physical health, mental health, personality, and economic status. We have also come to believe that an individual’s rank on narrow metrics of achievement can be used to judge their talent. These two ideas serve as the organizing principles behind our current system of education, the vast majority of our hiring practices, and most employee performance evaluation systems worldwide.” But if our goal is to identify and nurture individual excellence then we must pay attention to the distinct jaggedness of every individual; we are less likely to fall prey to one-dimensional views of talent that limit what we are capable of. For talent is always jagged. It’s a conclusion of twenty-first-century mathematics, rather than outmoded nineteenthcentury statistics, a fact which made Google rethink its talent recruitment and evaluation systems.

9.1.1 The Tale of the Perfect and the Jagged Resume Let’s for a moment ponder on how do we end up in the jobs we end up in? And why did we miss those opportunities we had set our hearts on? If most 119 Fernández-Aráoz C., “The Big Idea – 21st- Century Talent Spotting,” HBR , June 2014. 120 http://www.amazon.com/End-Average-Succeed-Values-Sameness/dp/ 0062358367/ref=tmm_hrd_swatch_0?_encoding=UTF8&qid=1438201586&sr=1-1 121 https://searchworks.stanford.edu/view/11622781 122 https://www.theatlantic.com/business/archive/2016/02/the-invention-of-thenormal-person/463365/ 123 http://www.intelltheory.com/galton.shtml

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of us look back, the reality is as likely to be fraught with chance as any other aspect of our work history. Our working lives are essentially constructs, born out of the physics and chemistry of the CV and the interview, the lucky break or a wrong call, or just occasionally of “perfect fit.” Resume is the currency of recruiting, and despite its many limitations, job boards, recruiters, and hiring managers are all enamoured with this selfreported narrative of a candidates work history, using it as a primary tool to screen both prospects in or out. There is nothing inherently wrong with resumes – they highlight applicants’ past achievements and experience. But while CV’s are good at showcasing formal skills, they struggle to find that holy grail of job qualification: culture fit. Resumes generally are a very poor information source and a weak predictor of future performance or inherent potential of an individual, the much valued attributes at any workplace. Traditional hiring processes that revolve around resumes are no longer sufficient today – they don’t pinpoint the right qualities demanded, and their dated criteria obscure many talented individuals from even hitting the radar. In his book, Why Good People Can’t Get Jobs,124 Peter Cappelli offers a number of reasons, in part blaming businesses for chasing the perfect resume instead of an actual person who has the core talent to do the job well. It is this infatuation with the “perfect resume” syndrome where our quest to find the right talent comes a cropper. An HBR article125 by George Anders sums this up cogently: Insist on a perfect resume each time, and it’s impossible to make the most of highly promising candidates with jagged resumes. The lost opportunities can be excruciating. Imagine the remorse of a venture capitalist unwilling to back Steve Jobs in 1977, because the personal-computer pioneer never finished college. For that matter, consider Apple’s fate in the 1990s, if the company hadn’t invited Jobs back for a second turn at leading the company, even though his first term ended in dismissal. As such extreme examples show, it’s essential to get comfortable with a resume that features a puzzling mix of highs and lows. Bring such candidates into play, and suddenly tomorrow’s unexpected stars become visible.By the mid-2000s, Google was already on its way to becoming an internet behemoth and one of the most innovative and successful corporations in history. Despite its continued growth and profitability, there were signs that something was wrong with the way it was selecting talent. 124 https://www.amazon.com/Why-Good-People-Cant-Jobs/dp/161363014X/ref= tmm_pap_swatch_0?_encoding=UTF8&qid=1474047772&sr=1-1#reader_ 161363014X 125 https://hbr.org/2011/12/spotting-the-great-but-imperfe

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Many of its hires were not performing the way management had imagined, and there was a growing sense within Google that they were missing out on a lot of talent whose true potential was not getting captured by the conventional assessment criteria’s focused around grades, standardized test scores, and work history. The prevailing sentiment motivated Todd Carlisle, the then HR director at Google, to begin an experiment. He listed 20 factors that might distinguish between hiring great employees and picking the wrong people. His early guesses focused on mainstream metrics, such as education and work history. Then he began asking executives: “What else would they add?” Eventually Carlisle topped out at 300 factors. Next, Carlisle ran test after test to analyze which of these factors were actually related to employee success. The results were startling: He couldn’t find a single variable that mattered for even most of the jobs at Google. Not one.126 In other words, there were many different ways to be talented at Google, and if the company wanted to do the best possible job of recruiting employees, it needed to be sensitive to all of them.127 Taking the wide view or the Yin and Yang of Talent Spotting became Carlisle’s overriding lesson. What Google learned was that it had been looking at candidates far too narrowly. Instead of fixating on academic achievements, Google gained a new appreciation for people whose marks had faltered because they were working 30 hours a week to pay for university. Google also came to prize highly competitive people who had chased an athletic dream or run a business when younger – and now were applying that relentless energy to career goals. Carlisle had discovered the jaggedness128 of Google talent and, as a result, made changes to the way Google recruits new employees. The key takeaway here for organizations truly interested in hiring great talent is to loosen up some of the parameters that sometimes are so absolute that you start to miss people who are very interesting on the edge. In Good to Great,129 Jim Collins argued that great talent spotting transcends formulaic efforts to pick out the perfect resumes. This process of getting to know talent is defined far more by an attention to “how” and “why” one does what he does and the broader context within which an individual operates.

126

https://hbr.org/ideacast/2016/04/smart-managers-dont-compare-people-to-theaverage 127 http://www.nytimes.com/2007/01/03/technology/03google.html?_r=0 128 http://www.danpink.com/2011/10/how-to-find-great-talent-4-questions-forbloomberg-views-george-anders/ 129 https://www.amazon.com/Good-Great-Some-Companies-Others-ebook/dp/ B0058DRUV6

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It’s not rocket science; it’s a more strategic way of thinking about things. According to Wendy Hirsh, an independent researcher and professor at Kingston Business School, who authored a paper on evidence-based HR for Corporate Research Forum in 2011: “Being evidence-based is partly about how professions see themselves.” And the recruitment professional of today needs to be able to separate the fact from fiction, signal from noise, and commercial opportunity from fad. What is required most of all is a mindset shift, the ability to think analytically, see an individual in a wider context and not as a data point on a bell curve. In recent times, the interplay of recruitment with data – Workplace Moneyball – is reflective of the growing appetite of organizations to apply quantitative rigor to some of the more intangible aspects of human potential, which cannot be gleaned by the conventional practice of filtering the resume. The conventional hiring norms have led organizations to place an inordinate focus on grades, university reputations and prior work experience missing out in the process central character traits that are generally accepted as future markers of success. Traits such as resilience, motivation, curiosity, and selfreliance are amongst the most likely ones to be prized by organizations. Uncovering these traits however requires a willingness to decouple from traditional strict scrutiny of paper credentials and turn the conventional hiring philosophy on its head. A philosophy which views jagged work histories leniently, forgives quirky personalities and inconsistent grades. Widen Your View of Talent The “Science of Individuality,” a new interdisciplinary field that draws from ergodic130 mathematical theory, developmental biology, neuroscience, and psychology is showing new pathways to assess human potential. Todd Rose, a leading figure in the science of individuality and whom we last saw in Chapter 9.1, illuminates us further, when he reflects “if we ignore jaggedness, we end up treating people in one-dimensional terms.” The jaggedness principle holds that all mental qualities we care about – intelligence, character, talent, performance – are multi-dimensional. Whenever we try to reduce the true complexity of someone’s ability into a single number, we lose everything important about the individual. And as Rose argues in his well-researched book131: Our system of judging people according to their deviation from the mean (faster, slower, stronger, and weaker) is smothering our talents; a one-dimensional view of achievement that seriously 130 131

http://www.staff.science.uu.nl/~kraai101/lecturenotes2009.pdf Ibid.

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underestimates human potential. In a sentiment that calls to mind Bertrand Russel’s timeless wisdom – “In all affairs it’s a healthy thing now and then to hang a question mark on the things you have long taken for granted” – the new era of talent spotting must consider a fresh way of imagining the employer– employee interface. This new way will demand more from employers, but it makes good financial sense for them to do it. Connoisseurs of this hiring philosophy are a small but growing tribe and are pulling ahead of competitors by making the most of these candidates whose resumes read like a patchwork quilt of jobs and experiences. If iconic companies like Google represent one end of the spectrum, there are others like Seedcamp,132 a start-up, which uses psychographics to identify teams with the greatest chance of success, tech companies like Kestral133 in Australia, which identifies the strongest performers through team optimization processes. There is no forbearance, though for lapses in ethics, an inability to work with people, or a lack of motivation. A jagged resume hiring can succeed only if the cultural fit between the company and the candidate is unusually good. Successful hiring greatly depends on this fitment so organizations need to take other off-resume elements into account. For too long, we’ve relied on a hiring regimen with standardized methods of assessing talent at its core. We have reluctantly endured it because these methods bear the imprimatur of objective fact. However, experience of Google and others of their ilk presents a different argument and points to the future of talent spotting: through the use of smart data and innovative approaches; interventions that can help override our myopic attentions, akin to an auto-da-fe, and turn the spotlight on a lot of talented people whose true abilities surpass the fitment cues implicit in preposterous screening criteria. Sizing up a candidate’s capacity to learn and grow is usually the hardest part of an assessment. Some organizations don’t even hazard a guess. They simply hire people whose current skills are sufficient. Only when organizations bring the courage to make judgments about potential do the odds of landing the right talent increases. This willingness to bet on the future can be seen with particular clarity in the story134 of that connoisseur of jagged resume hiring, David Evans of Utah University, who spotted and attracted an extraordinary group of

132

http://seedcamp.com/ https://www.saberr.com/team-case-study/U5XHnDEAAC8AbzYC/kestral 134 https://www.amazon.com/Rare-Find-Great-Talent-Stands/dp/1591845629?ie= UTF8&*Version*=1&*entries*=0#reader_1591845629 133

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talented but unconventional and unrecognized individuals – including the later co-founders of Pixar, Netscape, and Adobe Systems – and set them on their now famous career paths in the then nascent computing industry. The world is sprinkled with talented prospects which show up with a tantalizing, jarring combination of promises and pitfalls. Part of their resumes sparkle with fascinating strengths. And yet there are flaws. They are people with jagged resumes – and most organizations don’t know how to respond. Resumes tell a story. And over the years, I’ve learned something about people whose background appears to teeter on the edge between success and failure. A series of odd jobs may indicate inconsistency, lack of focus, unpredictability. Or it may signal a committed struggle against obstacles. At the very least, a jagged resume deserves a consideration. Reflections: Why the Best Hire might not have the Perfect Resume “Don’t confuse brains with a bull market.” – Humphrey Neill

Many of us think of ability, talent, and potential as essential qualities – things people possess or don’t. We tend to believe that, deep down in the bedrock of a person’s soul, someone is essentially wired to be friendly or unfriendly, lazy or industrious, introverted or extroverted, and that these defining characteristics will shine through no matter what the circumstances or task. We imagine that circumstances might have some influence over someone’s abilities but surely don’t determine or create them. This essentialist thinking was fundamental to the Taylorian mindset from the beginning, and in many ways has become the guiding principle for our hiring practices – most of which are still set up to ignore the contexts in which people actually work. As behavioural economist Dan Ariely noted in his book Predictably Irrational, “Most people don’t know what they want until they see it in context… Like an airplane pilot landing in the dark, we want runway lights on either side of us, guiding us to the place where we can touch down our wheels.” Sticking to Ariely’s metaphor for a moment, high-profile talent mistakes generally amount to a case of heroically aiming for the wrong runway. As organizations like Google and others of their ilk found out to their chagrin, ignoring aspects of jaggedness and contextual intelligence135 in their hiring efforts was leading them to the wrong runways. They were just missing out on all kinds of talent. Instead, they needed a new way of 135

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thinking that focused on a person’s innate potential and context-specific behavioural signatures.136 What these organizations learned was that they had been looking at candidates resumes far too narrowly. “Taking the wide view” became their overriding lesson and traditional ways of assessing talent became preludes rather than the main event. They made room for the obscure, out-of-the-way candidates that most conventional hiring systems would overlook. They made room for the mavericks, the late bloomers, the overachievers with the underdog past, and the inexperienced newcomers with amazing potential. This required making sense of what amounted to “jagged resumes.” These are the candidates who do not have smooth, well-rounded credentials to date yet there’s something about their drive, their ingenuity, their unusual background that hints at one-in-a-million promise. As George Anders writes on Spotting the Great but Imperfect Resume in his book: “This term does not appear in standard human resource manuals. But it’s a familiar concept for top assessors in fields ranging from commerce to medicine, sports, high finance, and philanthropy. Knowing what to do when a jagged resume enters the picture is the single biggest differentiator between organizations with a gift for picking winners – and those which keep wrong footing themselves. Some of the most talent-rich organizations in the world achieve greatness by knowing what kinds of jagged resumes are right for them. The recent years of economic turmoil have created a lot more jagged resumes in the labour force. As the economy tries to regain its heft and optimism, the companies that end up hiring the best people will be the ones that cultivate mindfulness and evolve creative responses in their hunt for talent. Companies that focus efforts on matching individuals to optimal contexts and avoid the perils of superficiality and narrowness in their talenthunting framework. The lyrics from ABBA’s137 famous hit, ‘Take a Chance on Me’ may well serve as their hiring tune when spotting the great but imperfect resume: Take a chance on me, Gonna do my very best and it ain’t no lie, If you put me to the test, if you let me try, Take a chance on me. 136

Shoda Y., Cervone D., and Downey G. (eds.). Persons in Context, Building a Science of the Individual (New York: Guilford Press, 2007). 137 http://www.telegraph.co.uk/music/what-to-listen-to/abba-the-best-songs/take-achance-on-me--1978-the-album/

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The payoff: the mysteries of fit, motivation, and potential become much clearer. So back to my original thought. Who are you going to bet on: The Perfect or the Jagged Resume? I say chose the underestimated contender, whose secret weapons are passion and purpose. As Jay Elliot wrote in his book138 on Steve Jobs, “Whether you think of them as nonconformists, rebels, positive deviants…make sure your team has a solid sprinkling of them. They will challenge your thinking, fuel your ideas, pump up your momentum, boost your competitive edge, and quite simply make your business a winner.”

9.2 Assessment Science “Know what’s weird? Day by day, nothing seems to change, but pretty soon…everything’s different.” Calvin from Calvin and Hobbes (by Bill Watterson)

This quote from a cartoon hero who through his hilarious antics both entertains us and teaches us valuable lessons about life captures in essence the future of the talent assessment industry. Born of a clinical tradition that saw psychologists using tools and methods created for use in the mental health field to evaluate human traits in the work environment, the discipline has undergone a quantum leap since its early days. The science of measuring people in order to predict their ability to drive business results, talent assessment represents the intersection of people and metrics. Viewed this way it is a no-brainer that assessments should be a foundational element in the talent acquisition process. Yet their usage in organizational settings paints a different reality and it’s often bolted on at the tail end of the bigger concerns related to HR technology systems, if it’s even used at all. Talent assessment is almost never seen as a strategic tool that can help drive measured impact. The reasons are not far to seek as throughout their over fifty-year history, the discipline has been highly esoteric, misunderstood, and sometimes misused. However, all of this is set to change if one takes a good look at what is happening in the world of talent acquisition in the context of bigger picture trends. Shifts in the global talent markets, skills shortages, new ways of working, and the growing importance of social media and employment brand are quietly at work setting the stage for major changes in the talent

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assessment industry. Technology and science are providing the necessary shot in the arm for organizations to fight the oppression of outdated and convoluted hiring processes, thoughtless treatment by employers, and an inability to connect with talent on a real and meaningful level. It’s the Arab Spring for talent acquisition – and it’s happening now! Talent assessment is playing a pivotal role in this struggle, providing a great example of all that is wrong with how employers are approaching the dialogue with talent. The past decade saw Internet technology freeing testing from the shackles of paper-based administration and reporting and a big shift in the use of online based pre-employment testing tools. A by-product of this shift was a veritable cornucopia of data that has better allowed us to understand the factors that predict performance in every job and industry. The collective power of the job applicants and the emergence of new technologies are causing an inversion in the status quo of the assessment practices. Technologies such as machine learning, artificial intelligence, natural language processing, predictive analytics to name a few are poised to shake up the way we assess people. The real disruption here is a shift from an “active model” to a more “passive” approach. In the passive model, data needed to measure human characteristics will be collated from candidates via their ongoing interactions with various technologies (e.g. mobile devices, wearables, laptops, etc.). “Passive” assessments would also bring the added advantage of a low impact on a job applicant’s time and attention. Analytics and technology are leading us to the doorstep of Assessment’s “Golden Era”, opines Dr Charles Handler, a leading practitioner in the talent assessment and human capital space. He further presents some thought provoking insights139about key trends in the assessment industry that will provide unprecedented ability to understand the relationship between people and jobs in the near and not so distant future: • Closed loop analytics: Businesses can now set up their hiring technology system to continually collect data related to job and /or organizational performance (i.e., sales revenue, customer satisfaction scores, absenteeism, unit-level performance) and stream it back into a platform that will compare it to pre-hire data in order to determine the impact of hiring tools on performance outcomes in real time. This would allow for a dynamic picture of the impact of pre-hire assessment on real 139

https://www.eremedia.com/ere/analytics-and-technology-have-led-us-to-thedoorstep-of-assessments-golden-era/

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business outcomes as opposed to the more common and less – effective static snapshot of these relationships. Tighter Integration between talent acquisition (TA) and talent management (TM): The importance of integrating TA and TM in organizations as the need for – and scarcity of – specialized talent becomes more critical cannot be overemphasized. Although the two functions have the same overall goal – ensuring the organization has the best talent – the roles just don’t intersect in many organizations. However technology advances, economic pressures for resource efficiency are all driving the need for a tighter mesh between the two to deliver deeper, more sustainable value for the organization and its employees. The increasing ability of technology today to integrate data feeds from “pre-hire to retire” implies that disparate systems like performance management, talent acquisition systems, and HR management systems can be better integrated, allowing for deeper insight into all talent centric decisions. When it comes to assessment this means that the impact of pre-hire assessment data on post-hire talent management will become much more visible, allowing it to add more value. Service Providers such as DDI, CEB, Taleo, and IBM Kenexa to name a few are already pointing the way forward by helping organizations understand the impact their talent acquisition process has on their talent management process. Sourcing will Change: Social media and analytics combined will lead to new models of sourcing, making it much easier for people to find jobs. The shift in the way we envisage jobs and careers today will visibly impact the way be source talent. A cornerstone of this impact will be the ability to accurately measure an individual on constructs that are critical for job performance (i.e., cognitive abilities, personality, career interests, job motivators, etc.) and to break jobs down into these same components. The ability to match people to job openings based on credible and reliable data will depend on quality assessment tools that provide a standard language for employers and job seekers. Social media based sourcing models that combine AI, psychometric measurement tools and advanced predictive analytics will increasingly drive value across the entire employee life cycle. Simulations, Competitions, and Analytics to Hire: When it comes to predicting job success, work samples, simulations and analytics are hard to beat. Organizations whose success is determined entirely by the quality of their talent – sports teams, orchestras, and comedy groups – have long realized the predictive ability of these assessment

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tools to source top drawer talent. Airline pilots must pass a simulator exam before licensure; violinists must audition before joining a worldclass orchestra; comedians must prove they are funny before becoming a Saturday Night Live cast member. And while the notion of “tryouts”140 or auditions is still in its infancy in the corporate world, the tools available to corporations to cast a wide net for talent and then directly measure relevant skills are now becoming widely available. This trend creates an opportunity for any business that relies on people for its success to dramatically improve its ability to attract and hire outstanding talent from non-traditional sources. However, companies with legacy recruitment processes may find the transition to a world of simulations, competitions, and talent algorithms daunting – much as sports teams did as they evolved from a model of scouts and “eye tests” to the analytics and data-driven model of today. That said, companies which fail to move in this direction over time will put themselves at a disadvantage versus competitors in the war for talent, putting at risk their competitive position, increasing their likelihood for picking the wrong leadership teams, and undermining their value to shareholders. Although traditional means of assessing corporate talent will still remain relevant, especially on personality and chemistry fit, these opportunities and growth within the talent assessment space are poised to shift into mainstream practice as organizational human resources and talent acquisition practices mature. The increased ability of technology to increase fluidity (speed) and accuracy (power) has placed us on the cusp of this shift, opines Dr Charles Handler, from one of his seminal studies141 in the talent assessment space. The future of the space will be defined not by I/O psychologists, but rather by multi-disciplinary collaboration between psychologists, sociologists, data scientists, and computer scientists. The increased role of analytics and hard data within HR practices will drive new levels of insight enabling informed decision making when it comes to competing for the right talent.

9.3 The Promise and the Challenge of Big Data Percy Bysshe Shelley, the nineteenth century English Romantic poet, is best known for his poem “Ozymandias”: “And on the pedestal these words

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appear: My name is Ozymandias, King of Kings: Look on my works, ye Mighty, and despair! Nothing beside remains… The lone and level sands stretch far away.” Shelley’s sonnet is a metaphor for change and the ephemeral nature of all things. To paraphrase the highly regarded poet: Nothing is permanent. Change is the constant dynamic. Periodically, a force of change comes along that fundamentally alters the way businesses compete and operate, in much the same way what centuries in the desert did to that “shattered visage” of Ozymandias.142 If we look around and see the changing complexion of our world, it may not be too bold or hyperbolic to suggest that Big Data represents one of these transformational changes. Tom Davenport in his book Big Data@ Work: Dispelling the Myths, Uncovering the Opportunities, makes the point, “Big Data is such a broad business resource that it is sometimes difficult to envision all the ways it can affect an organization and an industry.” As a piece of business jargon, and even more so an invocation of coming disruption, the term has quickly become tiresome. But there is no denying its ability to illuminate the human culture – leveraging algorithms that trawl through vast databases of our digital trails seeking to extract insight on the human experience, from how we fall in love to what we read. Data Scholars Erez Aiden and Jean-Baptiste Michael in their book, Uncharted: Big Data as a Lens on Human Culture,143 write: “At its core this big data revolution is about how humans create and preserve a historical record of their activities. Its consequences will transform how we look at ourselves. It will enable creation of new scopes that make it possible for our society to more effectively probe its own nature. Big Data is going to change the humanities, transform the social sciences, and renegotiate the relationship between the world of commerce and the ivory tower.” Some of these changes are already upon us, as Don Peck, the author of Pinched,144 takes us through an interesting data-driven journey in his insightful article, They’re watching you at Work: “Algorithms that predict stock-price movements have transformed Wall Street. Algorithms that

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chomp through our web histories have transformed marketing. Until quite recently, however, few people seemed to believe this data-driven approach might broadly apply to the labor markets.” According to John Hausknecht, a professor at Cornell’s School of Industrial and Labor Relations, in recent years the economy has witnessed a “huge surge in demand for workforce-analytics roles.” And it’s not only the human resources departments of large corporate such as Google, HP, General Motors, and Intel, to name just a few embracing data-driven approaches, but also small and mid-size companies in diverse business areas. This application of predictive analytics to people’s careers – an emerging field sometimes called “people analytics” – is enormously challenging, not to mention ethically fraught. And, while most companies are just beginning to explore the possibilities, there is no mistaking that the age of big data is finally upon us. Will this be a good development or a bad one – for the shapes of our careers; for the way we hire and spot potential? Let’s find out in the next chapter.

9.4 Data-Driven Recruitment “Data! Data! Data! he cried, impatiently, “I cannot make bricks without clay.” There’s much wisdom in the this saying, which has been attributed to Sherlock Holmes from that brilliant story “Adventure of the Copper Beeches,” written by Sir Arthur Conan Doyle and first published in the Strand Magazine in June 1892…Fast forward to today, a new age of strategic recruitment has dawned upon us, yet this nineteenth century Sherlock Holmes speak continues to be germane to the recent digital data explosion of our times. Simply put, from a recruiting perspective, with data (big or small) the recruiting function can measure, and hence know, radically more about its process internals, and directly translate that knowledge into improved decision making and performance. Put another way it aims to take the guesswork, gut feel and prejudice out of hiring, promotion and career planning decisions. Data’s Impact in the World Data or Big Data if you may have it is the new clay for building the blocks of a high impact recruiting function and in recent times has been increasingly gaining a foothold in the lexicon of Talent decision makers. For much of the last few years there was talk of just what Big Data is, and

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how new technologies are providing employers with new streams of data to analyze and deploy as they search for new ways to hire, manage, and retain the best talent. In the movie The Matrix, there is a scene where Laurence Fishburne says to Keanu Reeves, “The Matrix is everywhere. It’s all around us. Even now in this very room. You can see it when you look out your window or when you turn on your television. You can feel it when you go to work… when you go to church…when you pay your taxes.” The Matrix underscores how sentient our world today has become. With cameras, smart-phones, microphones, and other smart devices the human race is giving inanimate objects everywhere eyes, ears, and skin. And with all this observation, we are creating massive layers of data and information deluge. Every day, we create 2.5 quintillion bytes of data – so much that 90 percent of the data in the world today has been created in the last two years alone and the number is doubling every 40 months or so. Given this ocean of data, the prevailing wisdom is centered round the great competitive advantages big data potentially offers because it allows companies to make better predictions and smarter decisions. We can target more effective interventions, and can do so in areas dominated by gut and intuition rather than by data and rigour. As companies increasingly compete to recruit and retain the best people, HR departments are reinventing themselves from what’s long been seen as the “soft,” intuition-based home of the benefits police into an evidence-driven partner for business.145 But for all this data ubiquity, there are many obstacles to getting to a good place with it. Data is the lowest level of abstraction from which information is derived and its ability to enable informed decision making can only be brought to fruition if data aka “meaningful data” is analyzed and interpreted in the right business context. This is not an easy task, as our ability to store and communicate information has far outpaced our ability to search, retrieve, and present it. More importantly, data is useless without the skills to analyze it. As Tom Davenport and D.J. Patil noted in their HBR article, “On the Rise of the data scientist,”146 the advent of big data era means that analyzing large, messy, unstructured data is going to increasingly form part of everyone’s work. To thrive in this world, many will require additional skills.

145 https://www.washingtonpost.com/business/on-leadership/why-this-whartonwunderkind-wants-leaders-to-replace-their-intuition-with-evidencewhy-thiswharton-wunderkind-wants-leaders-to-replace-intuition-with-evidence/ 2016/04/08/8013a662-fc02-11e5-9140-e61d062438bb_story.html 146 https://hbr.org/2012/10/data-scientist-the-sexiest-job-of-the-21st-century/ar/1

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Ensuring that big data creates big value calls for a re-skilling effort that is at least as much about fostering a data-driven mindset and analytical culture as it is about adopting new technology. Another challenge, as big data pioneer Alex Pentland147 points out, is human understanding: “Finding correlations in data is one thing. Understanding them in a way that allows you to build a better system is much more difficult. There needs to be a dialogue between our human intuition and the Big Data statistics, and that’s not something that’s built into most of our management systems today.” Sceptics also question here the potential offered by big data in getting good candidates to respond when the recurrent theme song for most recruiters continues to find an echo in that 1988 single by the Moody Blues. The first part148 reproduced below sums it up pretty well: I know you are out there somewhere Somewhere, somewhere I know I’ll find you somehow Somehow, somehow And somehow I’ll return again to you

(The Moody Blues) Can Big Data help Change this Tune? Hopefully yes, but this requires a new way of thinking with a focus on introducing innovative approaches to find and engage with candidates. As the tools and philosophies of big data spread in the future, they will change long-standing ideas about the value of experience, the nature of expertise, and the overall practices in recruiting. Nobody knows for certain what the future holds, but as Neil Griffiths wrote in his introductory note in a seminal white paper by Dave Mendoza, “It seems the coming years will see the rise of what we call Future-Casting: the ability to interrogate data (big or small) generated by the increasingly social digital world and to begin basing hiring strategies and tactics on the new insights that are created.” Making the Difficult Job of Hiring a Little Easier It is one thing to argue that organizations would hire better if leaders leveraged data and applied the best evidence. It is another thing to do it. People decisions 147

https://www.edge.org/conversation/alex_sandy_pentland-reinventing-society-inthe-wake-of-big-data 148 “Every Step You Take, Every Move You Make, I’ll Be Watching You – Big Data and Recruiting,” by Singh R.; ere.net, Dec 21, 2012.

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are some of the most difficult, yet most consequential choices managers make. The demand for such decisions are relentless, information is incomplete, and even the very best executives make many mistakes and face constant criticism on second guessing from people inside and outside their companies. In that respect, managers are like physicians who face one decision after another. It isn’t possible for even the very best physician – or manager – to make the right decision each time. Hippocrates, the famous Greek who wrote the physicians’ oath, described this plight well: “Life is short and the art long, the occasion instant, experiment perilous, decision difficult.” These constraints mean that it would be naïve to claim that using a rigorous, data-driven hiring process, or any other mindset or practice can improve every people decision and action. But evidence and data do matter as deploying disciplined data collection and rigorous analysis – the tools of science – can help uncover deeper insights into the art and craft of hiring. Strategic sourcing, improved workforce planning, building critical talent pipelines are just few of the yet many un-researched possibilities presented by applying data principles to the recruiting process. And, while the industry is in consensus that the data interplay will change the nuances of recruiting as we understand now, many are not sure how. The challenges are enormous, yet it is a transition that recruiting must engage with today. If on one side there are aspects which provoke anxiety, on the other side is the promise of a hiring regime which is fairer to people at every stage of their careers. The ability of [data] to glean valuable insights on workforce and workplace behaviour, and to be able to predict and control them is definitely a case of Promethean fire – it could be used for good or for ill, and calls to mind the Chinese curse: “May you (talent acquisition) live in interesting times.”

9.5 The Digitalization of Recruitment

There was a time, not so long ago, when recruiting was very much simpler. You had an approved opening and you filled it. The technology tools at our disposal included a phone, a rolodex, and a notebook. Quality candidates

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were plentiful and sourcing meant calling people on that rolodex, searching through one’s privately maintained databases and maybe getting the word out about open positions through print publications. The recruiters “world of data” largely revolved around the “Holy Grail Metric” – Cost per Hire and a company’s recruitment strategy meant knowing when to step down on its in-house efforts and call in the third-party brigade. Hireology, a leading Talent Assessment firm in the US, recently released an infographic titled “The Evolution of Finding Candidates,” which provides an interesting account of how recruitment and selection has evolved over time. Starting with employee referrals dating back to ancient Rome, the infographic includes statistics and facts about how the industry has changed and where it is headed. Back in those “dark ages” candidates snail-mailed typewritten resumes in response to these print ads. An early innovation here was the fax machine which allowed candidates to digitally send resumes to employers. But the real game-changers were the desktop computers and the advent of the internet which completely democratized recruiting. Fast forward to today…time has certainly changed. Today, there are multiple layers of technologies, tools, partners, and services embedded in the recruiting processes, unmatched in complexity and sophistication from the days of yore. This interplay of social media tools, video, big data, analytics, cloud-based products, and mobile recruiting platforms is creating an interesting potpourri of resources geared to enhance the recruiter’s ability to more efficiently match job seekers with the right opportunities. However, digital convenience comes at the expense of meaningful engagement as digital transactions substitute key outcomes of physical interactions – the attention seeking, the trust and relationship capital – which is centric to the logic of the recruiting function. And, while this attrition of attention in the age of digital distraction is an undeniable reality, it is also true that these digital tools – from Google to Twitter to Facebook and smartphones – are giving us new ways to learn, to share ideas, and reach out to new talent hotbeds. These platforms, in many ways, are fuelling the emergence of what academicians Richard Susskind and Daniel Susskind call ‘communities of experience’ – online gatherings where people with common interests (whether recreational or work-related) come together and share their everyday experiences, insights, successes, failures, hopes, aspirations, and disappointments in remarkably candid ways. And the sharing of knowledge, as this HBR article149 points out, is not just limited to traditional social media 149

https://hbr.org/2016/04/recruiting-strategies-for-a-tight-talent-market

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platforms – LinkedIn, Facebook, and Twitter. For the software community, that may be Stack Overflow, a question-and-answer site specifically for programmers. For the medical field, it may be Doximity, which 60% of U.S. physicians are members of. For Millennial women, it might be Levo or The Muse. These avenues are offering an invaluable facility to the recruiting profession to be able to socialize, share, build communities, co-operate, crowdsource, compete, and hire in ways and on a scale that has no analogues in the analogue world. In an Internet society, according to the Susskinds, technology will enable new ways of sharing expertise that will lead to the gradual dismantling of the traditional professions. Providing a glimpse into this Future of Professions,150 the authors caution that we should not let our admiration for the features of current professions distort our judgment about the different people and systems that might replace them in the future. A classic case of this is the possible loss of “personal interaction.” Often, critics say that this personal interaction is in fact the most important thing about the professions. Losing this is too high a price to pay for change. The authors, argue here that the “purpose of the professions is not to provide people with ‘personal interaction.’ It is to solve problems that people do not have the wherewithal to solve themselves. It just so happened that, in the 20th century, the best way to do this involved faceto-face interaction with other human beings. But in the 21st century, if we find more affordable and accessible ways of doing so, we should embrace them rather than reject them – even if they look very different to the traditional approach.” The challenge for the recruiting function here is to face the implications of digital change; in particular the loss of control over the candidate relationship, increased competition and threat of commoditization, and the need to engage digitally with all key stakeholders in the recruiting value chain. This rapid pace of digitalization and the rise of the millennial generation are re-defining established workforce paradigms and will require the recruitment function to pull off new growth that business model innovation can bring while creating seamless and consistent engagement with all stakeholders.

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9.6 The Internet of Things (IoT) “Once we had neurons. Now we’re becoming the neurons.”151

Inherent in this sentiment is a radical new epistemology that is pushing the fabled concept of singularity right in front of our eyes. “Singularity” or more precisely “technological singularity,” speaks to the possibility of man merging with machines in a future where tech progress becomes so rapid that devices will become “super-intelligent,” even beyond the imagination and predictive capabilities of human beings. Ultimately, we could reach a point when artificial intelligence will take over human intelligence. The Internet of Things is pushing us towards this singularity. This rise of intelligent technology is no longer just the matter of sciencefiction fantasy (2001, Blade Runner, The Terminator, Her, etc.); it forebodes a new age of “super-intelligence” in which smart devices will exponentially extend human capacities and, conversely if the likes of Stephen Hawking, Elon Musk, and Bill Gates are to be believed, “The development of full artificial intelligence could spell the end of the human race.” Whether it creates a dystopian nightmare or becomes a force to amplify our collective potential for good, the IoT is a palpably present reality with which we are already living. More pervasive in its influence and significant in its implications, the Internet of Things is ushering in the next wave of rapid revolution for companies across industries. This “Next Big Thing” promises several benefits – the ability to improve efficiencies, gain new insight, automate and enable new business models, and on the flip side, as techno-optimists would have us believe, result in “predictable people.”152 While Big Data, as the foregoing section highlighted is primarily about data, the Internet of Things is about people, data, devices, and connectivity or as Tim O’ Reilly put the matter simply: “The IoT is really about human augmentation.”153 Astrophysicist and philosopher Marcelo Gleiser echoes this idea by pointing out the myriad mundane ways in which “machines that think” already permeate our daily lives: 151

https://www.brainpickings.org/2015/10/12/what-to-think-about-machines-thatthink-brockman-edge-question/ 152 http://www.theguardian.com/technology/2015/aug/10/internet-of-thingspredictable-people 153 “Tim O’Reilly Explains the Internet of Things,” The New York Times, February 4, 2015.

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We define ourselves through our techno-gadgets, doctor pictures that appear better or at least different in Face-book pages, create a different self to interact with others. We exist on an information cloud, digitized, remote, and omnipresent…The pace of scientific progress is a direct correlate of our alliance with digital machines. We are reinventing the human race right now. The Internet of Things allows physical objects to become active participants in business processes. Services are available to interact with these “smart objects” over the Internet, query and change their state, and any information associated with them.154 In the Internet of Things objects have virtual identities; they operate in smart, interconnected spaces; and in these spaces, objects can exchange data with their environments and “act” without direct human intervention. Recruiting in an Internet of Things World This section briefly explores the people side of IoT – the skills, talent, and leadership capabilities organizations would need to fully seize the opportunity – an opportunity that could fundamentally inspire a recruitment revolution. It is easy to imagine here a scenario in which automation would take over most of the jobs that people now get paid to do. While we’ll still need high-level decision makers and specialist technical skills, these tasks won’t keep most working-age people employed or allow their living standard to rise. The unavoidable question which Geoff Colvin poses in his groundbreaking book, Humans Are Underrated,155 – will millions of people lose out, unable to best the machine? – is increasingly dominating business, education, economics, and policy. Eric Brynjolfsson and Andrew McAfee, at MIT, in Race Against the Machine,156 point out that this rise of thinking machines could yield greater inequality, particularly in its potential to disrupt potential labour markets. As automation substitutes for labour across the entire economy, the net 154

http://www.louisdreyfusfoundation.org/fr/publications/graines-de-savoir/ publications/food-final-frontier1/ 155 http://www.amazon.in/Humans-Are-Underrated-Achievers-Brilliant/dp/ 1591847206/ref=sr_1_1?s=books&ie=UTF8&qid=1442758642&sr=1-1& keywords=humans+are+underrated%2C+geoff+colvin 156 http://www.amazon.in/Race-Against-Machine-Accelerating-Productivity/dp/ 0984725113/ref=sr_1_1?s=books&ie=UTF8&qid=1468655472&sr=1-1&keyword s=Race+Against+the+Machine%3A+How+the+Digital+Revolution+is+Accelerati ng+Innovation%2C+Driving+Productivity%2C+and+Irreversibly+Transforming +Employment+and+the+Economy

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displacement of workers by machines might exacerbate the gap between returns to capital and returns to labour. On the other hand, it is also possible that the displacement of workers by technology will, in aggregate, result in a net increase in safe and rewarding jobs. We cannot foresee at this point which scenario is likely to emerge, and history suggests that the outcome is likely to be some combination of the two: A job market increasingly segregated into “low-skill/low-pay” and “high-skill/high-pay” segments. Notwithstanding the many benefits and the slew of questions it raises, one of the most challenging aspects of seizing the IoT opportunity would be finding and attracting the highly sought-after talent who can make the organization’s ambitions a reality. The abilities that will prove most essential to our success here will no longer be the classroom-taught left-brain skills that economic advances have demanded from workers in the past. Instead, our greatest advantage, as Colvin demonstrates in his book, will arise from our deepest most essentially human abilities – empathy, creativity, social sensitivity, building relationships, and expressing ourselves with greater power than logic can ever achieve. These high-value skills would create tremendous competitive advantage – more devoted customers, stronger cultures, breakthrough ideas, and more effective teams. As new possibilities continue to arise from IoT, the need for these skills will continue to outpace current supply and will require organizations to embrace a new talent landscape157 – refer to exhibit below. Four Truths of the IoT Talent Landscape

Leaders here would need to define what the IoT opportunity means specifically for their organizations and strategies. At the macro level, organizations need to have structures ready to encompass new capabilities and talent as well as a culture that is flexible enough to fully embrace both. Organizations and cultures that are designed to foster IoT efforts are integral in attracting and retaining in-demand talent with agility, core competencies in software, data analytics, user experience and collaborative 157

https://www.spencerstuart.com/research-and-insight/internet-of-things-the-goldrush-for-talent

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skills, among others. Given the scarcity of IoT talent, companies would need to respond with proactive talent acquisition strategies that seek out unconventional hotbeds of talent and help build robust talent pipelines. Organizations would need the recruiting function to “fill jobs with quality candidates,” not just work a process: a promise the function may well live up to empowered by IoT enabled interventions. Important traits of individuals, teams, organizations, and populations that have traditionally been hidden from view are coming to the fore thanks to IoT collected data. This will give the emerging field of “People Analytics” greater scope to improve on unaided judgment plagued with cognitive biases while evaluating job candidates and employee performance. The implication of the celebrated book Moneyball158 is that such biases are so endemic to judgment-based hiring decisions that they can lead to inefficient markets for talent. Research159 also shows that we aren’t slaves to our hidden biases. The more we make ourselves aware of the role our unconscious plays in our decision making, and the more we force others to confront their biases, the greater the chance we have of overcoming our hidden preferences. Consistent with this, symphony orchestras160 began hiring a greater proportion of women after auditions began to take place behind screens so that candidates were evaluated based on the sound they made, not their appearance. Such smart anti-bias hiring approaches can change the way that we run any organization, not just businesses. It may not free our minds from prejudice, but it can make our biases less influential and help us to make our institutions more inclusive and productive. The Internet of Things is heralding the next big economic shift that will create new business opportunities for some businesses and dictate obligations for others. What will be needed is the talent to help make devices more intelligent and the way we interact with them more integrated. Digital ubiquity fuelled by the IoT affords both deeper and broader understandings of human, organizational, and social network behaviour. This presents the discipline of recruiting with a unique opportunity: “from insights, make decisions that refine the way we hire and create efficient talent markets.” It may well accord the discipline its long due status, that of a strategic function with the ability to create sustainable competitive advantage.

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CHAPTER TEN RECRUITING REVISITED – THE NEW RECRUITMENT MODELS

The recruiting landscape is undergoing rapid disruption and organizations looking to recruit and acquire talent must now compete in a new, more rugged terrain – a terrain shaped by new global talent networks and social media and defined by employment brands and changing views of career. In this new environment, continuing with the old ways of recruiting, acquiring, and assessing talent is like fitting square pegs into round holes. Companies that fail to adapt are going to find their pipelines depleted of the talent they need to compete and prosper. Progressive companies are rethinking their strategic approach in several dimensions to successfully negotiate the rockier path before them. These new approaches are pushing the boundaries of talent acquisition to include new models of employer branding, sourcing, hiring, and engagement for accessing skills and ideas. Additionally, there are lessons to be learned from the innovative best practices of some world-class recruiting organizations. A sneak peek at the new and emerging recruiting models point to some innovative practices profiled in the exhibits below.

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Centralization over Decentralization Economies of scale consideration weigh significantly in centralization decisions. But another equally important factor is expertise and excellence. While not a one-size-fits-all approach, a centralized recruitment model presents organizations with a consistent hiring experience for all stakeholders and at the same time elevates the efficiency of their recruiting processes.

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Closer Alignment with Business Units In companies with several different business units, creating dedicated recruiting teams that specifically support those business groups helps them anticipate the needs of each business and find ways to develop talent pipelines that better match their future direction. Specialization The complexity surrounding the recruiting function today has significantly impacted a recruiter’s role all geared towards how recruiting teams support their business partners and align their efforts towards achievement of business goals. Progressive organizations are finding value in dividing up the responsibilities and focus of their recruitment function around specialist areas like direct sourcing, workforce planning, hiring process management, talent analytics, and recruitment marketing to name a few. Specialization is also helping the cause of the recruiting profession by creating multiple, viable career paths and helping attract top drawer talent to the recruiting industry. Rise of Direct Sourcing and Networking The trends driving today’s recruiting marketplace are creating special challenges for organizations in the way they attract and engage with talent. The shift we are seeing here is one of moving away from the model of attracting and selecting the best talent to one of attracting, engaging, and selecting the best talent. Advances in recruitment technology have been a key enabler in directing organizational focus on activities that add the most value. The near ubiquity of ATS and CRM tools and automation of various parts of the recruiting life cycle is placing more time at the disposal of recruitment teams. The implication here is a greater emphasis on identifying top talent through direct sourcing, networking, and masscustomized recruiting approaches161 to fit high-value recruiting targets. Sourcing, relationship-building, and selling processes have to be central to the candidate-engagement process. The fight for talent is intense and if any story demonstrates how far employers will go in today’s fierce war for talent, the tale of Snapchat’s geo-filter recruiting campaign162 is it. In 161 http://www.eremedia.com/ere/mass-personalized-recruiting-a-powerfulapproach-for-high-value-candidates/ 162 https://www.forbes.com/sites/kathleenchaykowski/2015/04/15/snapchatsneakily-uses-its-own-app-to-poach-uber-engineers/#1d51c76273ec

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a creatively designed recruiting strategy, Snapchat had begun using geofilters (overlays that Snapchat users can put on top of images) in an attempt to lure employees from other top start-ups. The geo-filters combined amusing visuals and messages with the web address of Snapchat’s job page, all in the hope that a Twitter engineer taking a quick Snapchat break might come across the targeted “Fly Higher!” message and think, hey, maybe it’s time for a change. The Snapchat story underscores the importance of treating talent as customers: Understanding their behaviour, and designing recruiting strategies that meet them where they are. This requires a big picture view and close collaboration with other talent management functions (development, retention, technology substitutes, and internal movement) to ensure a focus on talent solutions, not recruiting alone. Consumerization of Candidate Experience The practices inherent in the above recruiting models and competency areas are reflective of the shift of power we are seeing today in the recruiting equation. This shift from an employer-driven market to a candidate-driven market would require organizations to recast their recruiting function as a well-oiled marketing machine capable of nurturing long-term relationships with the right candidates. Candidate relationship tools market a company through stories and products aimed at drawing in new prospects and cultivating them from the point of initial interest through their decision to apply for a job and join the company. High-performing companies like Delphi163 and Ford, for example, produce blogs to attract car fans, engineers, and manufacturing workers who may want a career in the auto industry. Readers might remember ‘Owen’ – from GE’s recruitment advertisement campaign “What’s the Matter with Owen?”164 – the fictional star, who couldn’t find anyone to share his excitement about his new job, a developer for GE. Everyone he knew thought he is going to go work on a train or live a life of manual labour. In his family’s living room, his proud parents give him his “grand-pappy’s” giant hammer. The Owen commercial is perhaps the most successful recruiting campaign in GE’s history – yet it wasn’t supposed to be a recruiting campaign at all, according to GE’s CMO Linda Boff. “We didn’t start off by saying, ‘How do we create a 163

https://www.delphi.com http://www.adweek.com/agencyspy/ge-and-bbdo-know-exactly-whats-thematter-with-owen/92849 164

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recruiting campaign?’ “We said, ‘How do we find an interesting way to talk about being a digital industrial company?’” The campaign increased applications to work at GE by 800 percent, an incredible stat, especially at a time when large corporations like GE struggle to recruit against the allure of sexy start-ups. However, such companies are more the exception rather than the rule when one looks at the skill mix of talent acquisition teams at large. While most organizations have built talent acquisition functions that are efficient at screening and selecting they lack the marketing chops critical to attract and engage with prospective talent. In order to create branded campaigns and effectively nurture longer-term relationships with the right talent, new skills need to be embraced by the talent acquisition function. Skills related to branding, messaging, demand generation, content marketing, email marketing, lead nurturing, and social media come to mind. Unfortunately, until talent acquisition leaders build marketing competency and data analysis skills within their teams, the process and results will remain disjointed with little chance to proactively meet the organization’s talent needs and push them to the forefront of modern recruitment marketing. The reasons are not far to seek as organizations traditionally have thought of recruiting as an HR issue and not as a marketing challenge. But acquiring and retaining talent is really no different than acquiring and retaining customers. Just as marketing produces sales, candidate marketing produces hires. Additionally, recruitment marketing also reduces staffing costs, attracts higher-quality candidates, and improves internal employee retention. Embracing it as a discipline that complements traditional recruiting can help optimize and boost the strategic impact of the function. In the years to follow, the top employers of choice will be organizations that consistently communicate an authentic employer brand story that wins the attention of highly coveted talent and compels them to follow, engage, and ultimately join (and stay) on their teams. Employers of choice treat their employment brand like their consumer brand. They analyze it, understand it, cultivate it, and carefully manage it. It’s time to take recruiting back from HR and turn it into a marketing mission. Recruitment is, and will remain, a people-centric function but its future promise to provide competitive advantage would lie more at the intersection of people with business, process, technology, and organization strategy. Those who understand this will be the winners in the twenty-first century.

PART IV COMPETING ON TALENT – SIGMA GROUP

This section captures the recruiting transformation journey of Sigma group in response to the challenge of competing for talent on a new battlefield – a battlefield shaped by new talent networks and social media and defined by employment brands and changing views of careers. In his book Good Strategy Bad Strategy,165 Richard Rumelt observes: “The kernel of a good strategy is the diagnosis of the situation, the choice of an overall guiding policy and the design of coherent action.” A good strategy does more than urge us forward toward a goal or vision. It honestly acknowledges the challenges being faced and provides an approach to overcoming them. Sigma’s talent strategy outlook was not a goal or an objective. It was a battle plan for action predicated upon a unique set of attributes or conditions (kernels) that set it apart from its competitors. Let’s find out more in the chapters to follow…

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CHAPTER ELEVEN DEVELOPING A LONG-TERM PERSPECTIVE

“A specter is haunting our time: the specter of the short term.”

That’s precisely what Brown University history professor Jo Guldi and Harvard historian David Armitage explore in The History Manifesto166– a compellingly argued case for why we need to eradicate the present epidemic of short-termism,167 a disease that “has many practitioners but few defenders.” Writing with remarkable prescience and insight they cite: We live in a moment of accelerating crisis that is characterized by the shortage of longterm thinking…Almost every aspect of human life is plotted and judged, packaged and paid for, on time scales of few months or years. There are few opportunities to shake those projects loose from their short-term moorings. It can hardly seem worthwhile to raise questions of the long term at all. These sentiments by some of the finest thinkers of our times, call to the mind the short-sightedness that ails the world of hiring. While most companies recognize the importance of the strategic nature of talent operations, they find revving themselves into a pathologically short attention span. This short-termism governs the way most companies organize their future. Long-term investments in human resources disappear from the balance sheet, and so they are cut. Lacking a strategic talent focus, organizations end up sacrificing their workforce planning capability and they find themselves deficient in creating leadership capital due to a less than optimal talent acquisition function. As David Maister, employing a rare blend of wisdom, experience, and humility, writes in Strategy and the Fat Smoker,168 “You can’t get half the benefits of a better marriage by cutting out half your affairs, cure half the problems of alcoholism by cutting

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out half the drinks or reduce the risks of lung cancer by cutting out half the cigarettes. So it is with business strategy. You can’t achieve a competitive differentiation through things you do reasonably well most of the time…The pursuit of short-term goals is inherently anti-strategic and self-defeating.” When we think of it, a combination of current operating needs and the long-term business plan is integral to shaping the overall talent acquisition strategy. A misalignment here only ensures that the organization loses out to its competitors in the “War for Talent.” However, breaking the cycle of short-term talent thinking is not easy. Yes, it’s important to achieve shortterm results as a way to test new approaches and build confidence – but these need to be put into the context of long-term value creation. Pulling for the Long Term One could, however, argue here that if change is so constant and disruptive that it makes predicting the future impossible, what is the point of taking a long-term perspective? Authors John Hagel III, John Seely Brown, and Lang Davison provide some rich insights here in their book,169 where they compellingly argue that “pull – the ability to accelerate capability building by creating the conditions to enable people to learn faster by working together – lets us respond rapidly and effectively to near-term developments, but a short-term mindset undermines its potential power. Paradoxically, successful deployment of pull techniques designed to cope with near-term uncertainty actually requires an increased focus on long-term direction.” Improving talent acquisition is a process of continuous evolution. This continuous improvement will be essential, because in a market where talent is a core business asset, recruiting is more than an overhead function; it is a critical capability that will drive the success of the business as a whole.

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If we agree that the mission of talent acquisition is effectively staff the organization to solve business problems, support the pursuit of new business opportunities, and enable competitive advantage then an opportunity exists to assess how effectively the organization is resourced. But the business of hiring the best is not just about hiring plans, budgetary investments, and leveraging the best technology tools. It is about understanding how we, as organizations, sit in relationship to talent. How we hire for it; how we leverage it; what it means to us. It is impossible to navigate the reality of our hiring ways without some sort of paradigm for thinking on where we are and where we are headed – Sensemaking as Christian Madsbjerg, who we last saw in chapter 6, would have put it. For Sigma, this meant engaging in its relationship with the past and then reason up from there to create a framework predicated on “design thinking principles.” Reasoning by these principles, as opposed to the analogical way of thinking, builds up knowledge from basics. It leads to a robust set of connections in your knowledge repository, all the way up from the most well-tested general facts to the particular hypotheses guiding your strategy. Noted Danish philosopher Soren Kierkegaard170 once observed, life is lived forward but understood backward. Like potters at the wheels,171 organizations must make sense of the past if they hope to manage the future. Only by coming to recognize the patterns that form in their own behaviour do they get to know their capabilities and their potential. Taking a historical perspective can be useful in both creating a sense of momentum and velocity, and also providing a view of historical precedence. It is important to create a “map of the organization territory” – its history, operating structure, internal processes, markets, and competitive forces – to be able to come up with a diagnosis. A good diagnosis172 often simplifies the overwhelming complexity of reality by identifying certain aspects of the situation as being the critical ones – the pivot points that can multiply the effectiveness of the effort – and then focus and concentrate action and resources on them. This understanding of the efficacy of an organization’s current strategic outlook and the desired future state leads to a clear articulation of the gap areas and the nature of challenges to be overcome in ensuring a strategic business alignment.

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https://plato.stanford.edu/entries/kierkegaard/ https://hbr.org/1987/07/crafting-strategy 172 http://www.mckinsey.com/business-functions/strategy-and-corporate-finance/ our-insights/the-perils-of-bad-strategy 171

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A natural advantage of this approach is insights into sources of organizational or functional strengths and weakness, its “superpowers” versus its “kryptonite.” It also enables a vuja de perspective of looking at things – of observing familiar, everyday things as if one were seeing it for the first time. Looking back at things from a different or fresh perspective can reveal new realms of advantages and opportunities as well as weaknesses and threats. Looking Back to Plan Forward A systemic inquiry of its past leading up to the current state of its talent operation – talent philosophy, corporate identity, structure, cultural integration, internal processes, and technology, was considered a necessary first step in designing a high-impact Talent Acquisition function at Sigma. The primary differentiator of this new hiring construct, as the chapters to follow unravel, was gaining access to the flows of knowledge and insights from other successful business systems and disciplines such as supply chain, sales, marketing, process reengineering and systems thinking. Perspective taking allowed decision makers at Sigma to navigate the complexities of recasting the talent acquisition function anew and to elevate it to new heights of efficiency and effectiveness.

CHAPTER TWELVE TALENT ACQUISITION AT SIGMA GROUP: A HISTORICAL PERSPECTIVE

“History does not repeat itself, but it often rhymes.”

An old saying frequently attributed to Mark Twain underpins our search for useful analogues in history; it is in the rhyming, the patterns, that we can find perspective on the dimensions of our challenges and on the questions we must pose in order to progress. For an organization taking a leap into the future, one of the most powerful tools available may be a sophisticated understanding of its past as reflected by M/s John T. Seaman and George David Smith in their seminal HBR article:173 “In its most familiar form, as a narrative about the past, history is a rich explanatory tool with which executives can make a case for change and motivate people to overcome challenges. Taken to a higher level, it also serves as a potent problem-solving tool, one that offers pragmatic insights, valid generalizations, and meaningful perspectives – a way through management fads and noise of the moment to what really matters.” A thoughtful consideration of enterprise history also helps leaders set a wise course. Decision making improves when leaders take the time to understand why actions were taken and how assumptions have become deeply rooted. As the great business scholar Alfred D. Chandler Jr. used to put it, “How can you know where you’re going if you don’t know where you’ve been?” For leadership at Sigma, then, the challenge was to find in its organization history its usable past, which would point the way forward to inspire collective efforts and re-visit the implicit beliefs and practices prevailing in the organization; managing perceptions which had repeatedly been demonstrated to have a strong impact on its assessments of talent and the consequent focus on its talent acquisition efforts. 173

https://hbr.org/2012/12/your-companys-history-as-a-leadership-tool

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Recalling History at Sigma Sigma’s decision to invoke the past in its recruiting transformation journey may have been intuitive, but its success was consistent with a finding of many scholars: A shared history is a large part of what binds individuals into a community and imbues a group with a distinct identity. “The present,” according to the historian and philosopher David Carr, “gets its sense from the background of comparable events to which it belongs…Discovering or rediscovering the story, picking up the thread, reminding ourselves where we stand, where we have been and where we are going – these are as important for groups as for individuals.” Sigma needed its key stakeholders to move beyond their traditional focus on recruiting as a transactional activity. It wasn’t enough for the leaders to explain the need to evolve their strategies to meet their overall talent and business needs; they had to instil in their employees the confidence to move boldly. So they started talking about their past in a new way. They pointed to the many moments of transformation in Sigma’s history: “its shift from project engineering to an integrated infrastructure engineering firm,” “its move into waste management & environmental sciences space,” and “its foray into the pharmaceutical business.” The point was to teach the company that innovation practices had long been the backbone of its growth. The Sigma story reminds us of the words of a great historian, Carl Becker. “The past,” he said, “is a kind of screen upon which we project our vision of the future.” Even when no clear picture of the future can be discerned in the past, leaders can use their histories to explain how the organization has arrived at a critical need for change. Among India’s largest integrated Infrastructure and Waste Management Organizations, the major operations of the group were conducted through the following business entities:

After a decade of brisk growth, Sigma found itself in the midst of some major competitive activity. Additionally, the group was also wrestling with an increase in upper-level attrition rate – key talent who were contributory to Sigma’s explosive growth story. The group enjoyed a strong market leadership

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position in the infrastructure and environmental sciences space and had won critical industry acclaim for its innovative business model(s). Yet despite the positive outlook, senior leadership clearly recognized that Sigma had to change or adapt some of the human resources practices that had allowed it to assemble and retain some of the “best engineering minds in India.” The change envisaged was a manifestation of the dilemma facing top management: how to protect the human resource policies and practices that had made the company so successful while adapting them to the new business realities. In particular, the focus had to be on how to strengthen Sigma’s ability to attract and retain first-class talent, as it entered the next phase of its growth journey with global aspirations. Protecting the Past, Building the Future In the real-world business environment, recognizing the need for improvement and acting on it resemble two hostile clans. Resources are tight and making a strategic impact in the face of pressures to optimize costs is an ongoing challenge. The scenario confronting Sigma on the one end, was the need to invest in changes to compete on talent in the future, driven by concerns around the declining quality of hires, and on the other end, preserve its sense of legacy. But talented individuals are drawn towards organizations that continually refresh their systems and processes as well as their strategic initiatives, in order to delight customers and outwit competitors. Perhaps the most powerful way to do this is by building a talent strategy that both endures and regenerates. Let’s find out more in the sections to follow. The exhibit below details the top pressures in talent acquisition174 facing Sigma group in the background of an increasingly competitive business environment.

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SIGMA Company Source.

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As an aspiring best-in-class infrastructure player, the stakeholders at Sigma knew well that the group’s hiring philosophy had to be the primary vehicle for driving their strategic initiatives and growth plans. So, when it came to competing on talent, it was natural for its business leaders to ask, “What are other companies doing?”, “How well are we doing in relation to our peers?”, “How strong is our Employment Brand?”, “Are we creating innovative efficiencies in our recruitment practices?” or “Are we still planning, waiting to do so in the future?”, “What are our constraining factors to onboard top talent?” Their thoughts were well seconded by a research study conducted by The Aberdeen Group in the fall of 2013, which highlighted the distinguishing characteristics of Top Strategies for Talent Acquisition between “Best-in-Class” companies and “Others” (refer to exhibit below).

What set the talent strategies of these best-in-class companies apart was that they were relentlessly focused on supporting, and in some cases driving, the companies’ business strategies. They added value and worked exceptionally well. To get a ground up view on these key differentiators, the talent acquisition function at Sigma was examined through a strategic framework of five primary areas. The framework rooted in design

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thinking principles set the tone for understanding the web of interconnected elements that formed the organizational core and served as a change enabler. The following chapters offer a discussion around each of the framework elements and how the art and science come together to weave a rich mesh of insights. These insights translated into actions helped identify and bridge the gap areas paving the way for a new hiring construct at Sigma group.

CHAPTER THIRTEEN STRATEGIC FRAMEWORK FOR TALENT ACQUISITION AT SIGMA GROUP

“If I had an hour to solve a problem and my life depended on the solution, I would spend the first 55 minutes determining the proper question to ask, for once I know the proper question, I could solve the problem in less than five minutes.” – Albert Einstein

How does a corporate such as Sigma begin evolving its talent acquisition function to boost strategic impact? The process of evolution began by asking questions encompassing all aspects of talent acquisition and knowing how to look at the function as a whole, integrating key elements of the framework construct. Implicit in this framework was the thinking that key outcomes

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of the talent acquisition function must create intrinsic value and address specific business needs. This cannot be done unless the emotional as well as the functional needs of the users – internal or external stakeholders and talent prospects – are given due cognizance; understanding not only their stated needs but also uncovering hidden and unarticulated concerns. This was a design problem – one that required new rules of engagement with a broad set of collaborators. Viewed another way it was Sigma’s TA Compass175 – refer to exhibit below – which encapsulated the framework construct that would generate quality hires. It was the production process through which the magic of hiring was created. In its essence, the compass created a shared vision of excellence using design thinking principles and then aligned the major elements that every organization shares – its people, infrastructure, and processes – in a cohesive, comprehensive effort to deliver on that vision.

The TA compass added a fluid dimension to the exploration of complexity, in the group’s current talent operations, allowing for nonlinear thought in tackling nonlinear hiring problems. It is hard to remain devoted to the task of building robust evidence-based cases for action when it’s clear that good storytelling often carries the day. As Einstein put it, “Not everything that can be counted counts, and not everything that counts can be counted.” Good stories have their place in an 175

http://www.amazon.com/Be-Our-Guest-Perfecting-Institute/dp/1423145844 #reader_1423145844

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evidence-based world, in rallying people who will be affected by a change. “This form of artifact helped us better tell a story to various stakeholders,” said a senior TA leader at Sigma. Even more important, he added, it “helped us develop a strategic way about changing the entire hiring construct and to communicate that emergent strategy. The Power of Design Thinking “Most people make the mistake of thinking design is what it looks like. People think it’s this veneer – that the designers are handed this box and told, ‘make it look good!’ That’s not what we think design is. It’s not just what it looks like and feels like. Design is how it works.”– Steve Jobs

The above sentiment expressed by one of history’s most creative and visionary leaders, typifies how design as a concept has been slowly evolving and gaining traction over the past decade. It has over the years, moved away from the realm of product design and its tools have been adapted and extended into a distinct new discipline: design thinking. Arguably, Nobel Laureate Herbert Simon got the ball rolling with the 1969 classic, The Sciences of the Artificial,176 which characterized design not so much as a physical process as a way of thinking. Tim Brown, CEO of the celebrated design and innovation firm IDEO, captures the essence of this thinking cogently when he writes: “Design thinking is that uses the designer’s sensibility and methods to match people’s needs with what is technologically feasible and what a viable business strategy can convert into customer value and market opportunity.” Basically this means a style of thinking which combines empathy for the context of a problem, creativity in the generation of insights and solutions, and the rationality to analyze and fit solutions to the context. It is an approach that strives to strike a fruitful balance between reliability and viability, between analytics and intuition, and between the art and the science. “This new approach is in large part a response to the increasing complexity of modern technology and modern business,” writes strategist and author Jon Kolko in Design Thinking Comes of Age.177 For instance, it’s much easier to appreciate the role of design when it comes to physical objects: cars, bridges, buildings, dresses, smart-phones, laptops, and so on. But, it’s considerably harder to appreciate its importance when it comes to more abstract entities like systems, services, information, and 176 177

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organizations. Their very nature is vague. You can’t touch them. Yet, they account for the bulk of the growing complexity in our lives.178 How do we apply design thinking to the way organizations hire?

While design thinking has become part of popular lexicon in contemporary design and engineering practice, its principles can also be seamlessly applied across multiple disciplines and industries. The premise is that by knowing about the process and the methods that designers use to ideate and by understanding how designers approach problem solving, individuals and businesses will be better able to invigorate their ideation processes in order to take innovation to a higher level. A customer-centric function such as talent acquisition involves people and their many interactions with each other. People’s behaviours will generally exhibit lots more variations than the components of a natural or engineered physical system. As a result, people-centric systems are changing all the time making them intrinsically emergent179 or unpredictable. That’s where design comes in. Marc Stickdorn in This is Service Design Thinking, lays out key principles – refer to exhibit below – that can help people oriented complex functions such as recruiting drive a more thoughtful, human approach to business. Let’s look at each in turn: ‡ User Centred: It means services should be experienced through the eyes of the customer. This intensive customer focus has increased as technology-enabled transparency and online social media accelerate an inexorable flow of market power downstream,180 from suppliers to customers. Now every company in any sector wants to be closer to its customers, to understand them more deeply, and to tailor their products and services to serve them more precisely. ‡ Co-Creative: It means working with all stakeholders to explore needs and new processes. The approach aims to serve the interests of all stakeholders. It focuses on their experiences and how they interact with one another. ‡ Sequencing: It is focusing on how the rhythm of the service impacts the mood of the customer. As Stickdorn describes, “Think of service as a movie with multiple scenes. If the service is too fast, it might make customers anxious. Too slow (think waiting in a checkout line) and customers get bored or even mad.”

178

http://blogs.wsj.com/cio/2015/09/25/the-evolution-of-design-thinking/ https://hbr.org/2011/09/embracing-complexity 180 https://hbr.org/product/tilt-shifting-your-strategy-from-products-to-customers/ 11165E-KND-ENG 179

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Evidencing: It is something we don’t commonly think of with services. It means making customers aware of intangible, sometimes “behind the scenes” services. • Holistic: It means keeping the mood and feelings of the customer in mind throughout the service journey. How do all the service “touchpoints” add up? How does the customer’s senses react to the physical environment? Everything matters in the final customer experience. We next take a deep dive into the salient aspects of each of the TA framework elements examined through the cross-hair of design thinking principles. The chapters to follow outline how Sigma leveraged these principles to define problems artfully and experiment its way to solutions.

13.1 Employer Brand User-Centered

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Dilbert’s exhortations to his pointy-haired boss underscore a changing employer-employee compact. An alliance181 where parties understand that they’ve entered into a voluntary relationship that benefits both sides. In this new construct people choose jobs – and most important, become engaged with their work – on the basis of how well their preferences and aspirations mesh with those of the organization. Companies spend over $720 million182 each year on employee engagement, and that’s projected to rise to over $1.5 billion. And yet, employee engagement is at record lows – 13 percent according to perennial engagement survey leader Gallup.183 Adding to this dismal outlook is the growing concern across organizations about finding and keeping the best talent to achieve their growth ambitions. Different surveys show that in 2014, 36 percent of global employers reported talent shortages,184 the highest percentage since 2007, and in a more recent 2015 survey, 73 percent of CEOs185 reported being concerned about the availability of skills. These statistics, however, like the proverbial tip of the iceberg do not reveal how the workplace has changed in recent decades, and how these changes have broken down the trust in the relationship between employers and employees, to everyone’s detriment. That’s what Sigma set out to explore and create in its employment framework – A brand thinking186 built around reciprocity; one that fosters employee engagement and company growth even as it acknowledges the finite nature of their relationships. Design and branding maven Debbie Millman187 calls this “a form of affiliation that we end up benefitting from – the benefits come from the association and the affiliation. Then we can use them to project how we want to be seen in the world.” The power of design is that it can start to create the awareness.

181

http://www.theallianceframework.com/ https://www.eremedia.com/tlnt/weekly-wrap-720-million-spent-on-engagementand-this-is-all-we-get/ 183 http://www.gallup.com/businessjournal/188033/worldwide-employeeengagement-crisis.aspx 184 http://www.manpowergroup.com/talent-shortage-explorer/ 185 http://www.pwc.com/gx/en/ceo-agenda/ceosurvey/2015.html 186 https://www.brainpickings.org/2013/05/01/brand-thinking-debbie-millman/ 187 https://www.amazon.com/Brand-Thinking-Other-Noble-Pursuits/dp/ 162153247X/?tag=braipick-20 182

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Employer Branding: Capturing the Organizational Spirit Malcolm Gladwell in his book, The Tipping Point, talks about the significance to an organization growing beyond 150. He makes the point that from huntergatherer societies and agricultural colonies to military organizations, this number represents a natural tipping point for communities. Beyond this point, the personal familiarity, peer pressure and informally shared ethos that binds the group together begins to break down, and more formal hierarchies, rules and regulations tend to be required to maintain group order and solidarity. Whether or not 150 represents the natural point of transition, the business benefit of developing an employer brand proposition as an organization grows from being small to large and impersonal is to help identify and retain something of the spirit that drove its early success and made it feel special to its employees. This essential appeal of being special is a visible, distinctive element of an organization’s overall employee experience (read user-experience) that tells the right story about the organization. The benefit of capturing this story – essence and spirit – of the organization in some form of employer brand proposition has been well documented. Lynda Gratton has recently written about “hot spots”188 as the hallmark of most successful and progressive organizations. These are times and places within businesses and teams where cooperation flourishes, creating great energy, innovation, productivity, and excitement. At the core of a successful employer brand is a clear “Employee Value Proposition” (EVP), which should match the expectations of its targeted talent. An aligned EVP is important for a very simple reason: if an organization does not reasonably meet the values and the expectations of its employees and the talent it seeks, it is less desirable as a place to work. That may result in fewer quality candidates and possibly higher turnover for employees after they are on board. It is a visible expression of an organization’s culture. The key poser before stakeholders at Sigma group in initiating a realistic assess of their Employer Brand was: “Is our employer brand mix appealing to the aspirations, underlying motivations and values of talent we have and that we wish to reach out to?”

Wally Olins,189 one of the forefathers of modern-day branding, shares his eloquent view, that “when a brand gets its mix right it makes us, the people who buy it, feel that it adds something to our idea of ourselves.” And, importantly, this is equally true of employees as it is of consumers. Today, this sense of affiliation to a corporate purpose is central to the people power 188 189

http://www.lyndagratton.com/books/44/59/Hot-Spots.html http://wallyolins.com/

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of the brand and is at the heart of a strategic definition of employer branding. People are more likely to trust a company based on what its employees have to say than on its recruitment advertising. This means that talent attraction relies far more heavily on employee engagement and advocacy. From a discipline limited to the resourcing outskirts of human resources, employer branding is set to acquire a more strategic character with its potential ability to align people-management processes and practices and drive employee engagement. Evidence suggests that taking a more integrated approach to employer brand management may represent a significant opportunity to enhance overall levels of internal engagement, in addition to promoting an employer’s external reputation. According to new research – refer to exhibit below – organizations are increasingly using their employer brand to shape their overall people management strategy and not simply for external recruitment purposes.

The Business Case A well-defined employer brand must be well integrated with the business strategy and articulate the shared responsibilities for achieving success. The ROI here is not an HR metric (time-to-fill, or cost-to-hire) but rather a metric of revenue growth. An interesting framework the stakeholders at Sigma looked at here was the Service-Profit Chain made famous by M/s James L. Heskett, W Earl. Sasser, and Leonard A. Schlesinger (refer to exhibit below). In the book by the same name, the authors powerfully establish the relationship between employee satisfaction, customer satisfaction, loyalty and revenue growth.

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The links in the service-profit-chain190 are as follows: Profit and growth are stimulated primarily by customer loyalty. Loyalty is a direct result of customer satisfaction. Satisfaction is largely influenced by the value of services provided to customers. Value is created by satisfied, loyal, and productive employees. Employee satisfaction, in turn, results from high-quality support services and policies that enable employees to deliver results to customers. The role of employer brand in ensuring that employees both understand and commit to the new service promise is to identify how the organization’s treatment of employees can model the kind of brand experience they are expected to deliver to customers. Employees are unlikely to “live the brand” unless they experience it for themselves. In essence the Service-Profit Chain underscored a key precept as the exhibit below illustrates:

190

https://hbr.org/2008/07/putting-the-service-profit-chain-to-work

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How Strong is Our Employer Brand? This message was not lost on the stakeholders at Sigma who understood that a signature brand experience must be buttressed by processes that send consistent messages to both present and prospective employees. The Service Profit Chain provided a useful construct for understanding the pivotal role “Employment Branding” plays in driving employee engagement – both existing and prospective – and determines what drives the long-term organization profitability. As a step towards taking aim at the heart of unnecessary organization complexity by putting the experience of its key stakeholders at the centre, Sigma embarked upon an organization wide audit encompassing the employee, customers and the leadership segments. Salient aspects considered important to be addressed as part of the audit review are detailed in the exhibit(s) below.

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These constructs helped reveal detailed and actionable insight in formalizing a cohesive EVP, which was pivotal to the success of Sigma’s re-engineering effort.

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13.2 Structure Co-Creative

The application of the co-creation principle to talent acquisition at Sigma was towards re-crafting its operating model to facilitate increased collaboration among all key stakeholders and deliver deeper, more sustainable value for the company. The process of revisiting its operating model was made easier by first laying out the design criteria: “We will design to encourage a tighter integration between talent acquisition and all other talent management practices.” This importance of integrating TA (talent acquisition) and TM (talent management) was something Sigma could have ignored at its own peril, as hiring managers demanded faster, higher quality talent acquisition and employees demanded to know what options existed for them to learn and grow in their careers. Operating models, defined An operating model as the exhibit below illustrates, dictates where and how the critical work gets done across an organization. It serves as a vital link between a company’s strategy and the organization structure that it puts in place to deliver on strategy.

Operating models define the nature of interactions among the strategy, structure, people, processes, and technology elements. Additionally, they also help realize the intended synergies that may arise in the interaction among these key organization variables. In their essence, they help determine the rules of the game and need to be well conceptualized before the detailed organization design is laid down.

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How to get there Historically any discussion around the operating model invariably touches upon the perennial question of centralization versus decentralization. For Sigma group this was no longer an either/or discussion so much as a question of balance. Its present structure was aligned to its four main lines of business that is: Infrastructure, Real Estate, Environmental Sciences, and Pharmaceuticals. Each business line recruitment function was structured with teams focusing on campus recruitment, lateral hiring, and hiring for different geographical regions. Although, the structure worked in terms of providing a sharper focus and alignment to fulfilling the recruitment demand, the silo approach created problems for Sigma at a macro level. To describe the situation: It was a classic case of the left hand not knowing what the right hand was doing. The teams had their own ways of working with no uniform reporting, no synergy or exchange of database, resources, external partners, pipelines or profiles. There were internal allegiances and power bases which needed to be realigned. None of the teams was at the maturity level to define or measure the performance levers of a talent acquisition function and hence the organization-level systems, tools and platforms could not be implemented, clearly impacting the business. Additionally, a wall of separation had existed between the TA and HR functions for years. TA operated on its own, separate from HR, while bemoaning the fact that no one gets what they do. At the same time HR business partners often wondered, “What do these recruiters do?”“How hard can recruiting be?”

In arriving at the right delivery model construct, the team researched some of the key models being used by contemporary organizations. The salient aspects of each of these appraised models are profiled in the exhibits below:

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Benchmark data191 around these key operating model elements was leveraged by the leadership team at Sigma. This helped guide their decisions in creating the right operating model and the organizational structure construct as detailed in the following exhibit:

Rethinking how and where critical work gets done may sound daunting, but organizations that get this right take a holistic approach.192 They view their organizations as more than a collection of lines and boxes. In addition 191 192

Cooper D., Dhiri S. and Root J. Winning Operating Models. (Bain & Company). Ibid.

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to structure, they place equal importance on the interfaces and behavioural expectations. They thoughtfully develop design criteria to help them chose among operating model options. They work collaboratively to redefine their operating model, involving all key stakeholders. And they think about change management from the outset through implementation. It was important that the envisaged operating model of the TA organization – the pattern of communication, authority, and work process flow relationships – at Sigma were in alignment with the business strategy. This structure and strategy compatibility was of essence here as a poor fit can cripple the best of the strategies because, in the end, every effective structure is a reflection of strategic intent and of the values and goals of the organization.

13.3 Process & Technology Sequencing

The purpose of any recruitment process is to predict which person will be the most successful within the ambit of a defined talent role in a given organization context. The more structured the process the better is the performance predictability of a prospective hire. Sequencing essentially is about applying the science to people decisions which ensures a consistent, more predictable quality of hire outcome. This is about the “Science of Fit Research,”193 which examines the various job roles – present and anticipated – at work within an organization and diagnoses the knowledge, skills, and attribute mix somebody needs to succeed on these roles. The combination of the sourcing mix, screening, assessment, and interviewing methods carefully developed, sequenced, and executed by the right assessors and supported by the right technology backbone is critical for the success of any high-performing talent acquisition program. Let’s find out more in the process re-engineering journey of Sigma. Process at Work Hammer and Champy194 defined a business process as “an organized group of related activities that together create a result of value to the customers.” Based on this definition, business processes are broader and more strategic in nature than business transactions. They combine and coordinate transactions, cut across 193

https://www.linkedin.com/pulse/20130330215858-131079-making-the-case-forpre-hire-assessments 194 http://www.easy-strategy.com/michaelhammer-and-Jameschampy.html

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barriers of departments, time constraints, and bureaucracy; and are focused more on the needs of the customer and less on those of the processor – or his supervisor. But business processes have upper and lower boundaries. Built too large or trying to cover too much, processes become unmanageable behemoths that frustrate coordination and defy execution. Cut too fine, they lapse into transactions that add little value to the customer. Processes comprise the most prominent service delivery system in most organizations. That is, they deliver an output, such as a product or a service. In fact, more than three-quarters of service delivery in most industries and institutions is process-based. One can think of process as a railroad engine.195 If the engine does not run properly, it does not matter how friendly the conductor acts or how attractive the passenger car looks, the train will still not move and the passengers will not pay their fares. Process is the engine of Quality Service and since recruiting is all about delivery of a quality hire, it was considered critical to pay special attention to the hiring process at Sigma, which included moving talent through the stages of sourcing and attraction, the screening and assessment, and finally the on-boarding stage. The process map in the exhibit below captures the many separate transactions involved in each sub-process of the hiring life cycle. To evaluate the process in its entirety, it was considered practical to view its components on a granular level.

195

http://www.helpscout.net/blog/disney-customer-experience/

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Managed as a disparate set of activities, work flow outputs from these process steps can have a detrimental impact on overall recruiting performance with no real value for the customers – the hiring managers and the talent prospects – who are more concerned with the quality and the timeliness of the outcome. A consistent process allows recruiters to improve efficiency and quality and establish tangible business outcomes. When we think of it, employers ultimately do not want employees. Instead they want the correct and timely mix of talent who can either supply products or services customers value immediately, or in the long term, do one or more of the following: A. Increase customer use and value perception of products or service. B. Develop or find new customers for existing products or services. This presupposes a service-oriented mindset. It means listening well to the customers, rethinking every communication and interaction no matter how mundane, and an attention to detail, an attitude, which is essential if one has to handle customer servicing with empathy. Making the connection between what customer values and what talent provides is a recurring new reality. In appraising the efficacy of its recruiting process from its customers – hiring managers and talent prospects – perspective, and whether it was demonstrating talent value, Sigma group broke new ground by adopting the basic tenets of Lean. By embracing the fundamentals of Lean manufacturing – identifying value-creating activities, eliminating waste, and focusing on continuous improvement – HR and TA leaders at Sigma realized that they could lift recruitment to new heights of efficiency and quality. What exactly, then, is the Lean Philosophy and how was this leveraged to improve the recruitment processes at Sigma?

Lean Up Close Lean principles are derived from lean manufacturing practices developed as a strategy by the Toyota Motor Company. A management philosophy anchored around the Toyota Production System (TPS), its key principles were shaped by Taiichi Ohno, a Japanese businessman, widely considered to be the father of TPS. In its essence, lean manufacturing is a philosophy in which practitioners commit to continuous improvements using critical tools to help them identify and eliminate waste and irregularities in the processes. Ohno’s principles influenced areas outside of manufacturing and are being leveraged to improve business processes such as recruitment. The benefits to HR are well documented. According to a study conducted

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by researchers at Coventry University,196 lean principles applied in a pilot project to improve candidate recruitment at the institution helped to significantly raise outcomes. Involving staff from the university’s HR recruitment team, external recruitment agencies, and IT services, as well as customers from library services, academic faculty, and student services – the project netted a 20 percent reduction in overall time to approve and fill staff positions. More importantly, the exercise helped HR to identify noncore, ancillary activities that occupied their time, enabling them to simplify and expedite the entire process. The “Lean Journey” of Sigma Several challenges prompted Sigma to embark upon its lean journey. Its need for highly skilled employees was increasing just as turnover was increasing because of strong industry demand. In search of a sustainable advantage, conceived around an ability to hire superior talent, Sigma’s leaders decided to build a lean system. Although they recognized that this approach lacked the visibility for service-centric functions and would require a profound transformation of Sigma’s hiring practices, they believed that the potential payoff – the ability to improve faster than their competitors was worth the risk. Key managers began studying how the lean approach had been applied in manufacturing. They pored over all the written material they could find, toured lean factories, and conferred with quality gurus. Then they brainstormed about how to use what they had learned; and gradually identified practices that worked. Becoming Lean An end-to-end mapping exercise of the recruitment process at Sigma leveraging a number of lean tools detailed in the section(s) below was considered as a necessary next step to establish baseline measures. The approach allowed the team members to produce a future-state process map that was free of identified waste and non - value added activities. As one of the first interventions, the TA team at Sigma conducted a voice of customer (VOC) & voice of the business (VOB) data collection. This helped align what steps in the recruiting process cycle were critical to quality (CTQ) and were value – add versus non value – add. Key business unit heads and HR 196

Martin S. and Arokiam I. (2008), “Investing to Improve – Organisational Development and the link with Lean for Continuous Quality Improvement,” proceedings from the 11th QMOD Conference, Helsingborg, Sweden.

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representatives who had all been involved in at least one recruiting process in the past were interviewed. Sample representative questions to determine the customer needs, their relative importance and measurable CTQs (critical to quality) are detailed below.

The results from this internal VOC were structured via a quality function deployment (QFD)197 as shown below in the QFD I exhibit. The QFD methodology focuses on the most important service attributes or qualities. These are composed of the customer wows, wants, and musts, which are translated into specific process design objectives.

197

https://www.isixsigma.com/dictionary/quality-function-deployment/

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The most important CTQ’s were summarized in a design scorecard (see figure below). Using historically collected data a baseline was established that showed the performance of the customer requirements at the project start. This baseline information was leveraged by the TA team to set the project goals.

As a next step, the team conducted a functional analysis. In a process design, functions are high-level process steps. Developing functions enabled the team to define the necessary steps of the recruiting process without immediately having to think about solutions, detailed concepts or a detailed process design. In order to determine functions that would contribute the most in meeting the customer requirements the team used another QFD as illustrated in the QFDII exhibit below

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This set the tone for the detailed process development for the top prioritized functional areas. A representative Design Element Chart for the prioritized functional areas is profiled here:

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SIPOC (Suppliers – Inputs – Process – Output – Customers) The suppliers, inputs, process, output, customers (SIPOC) process map – see exhibit below – essentially identifies at a high level the potential gaps (deficiencies) between what a process expects from its suppliers and what customers expect from the process, thus defining the scope of the process improvement activities. This process definition tool was leveraged to provide a high level overview of the recruiting life cycle at Sigma, importantly the In-Scope and Out-of-Scope activities. It additionally helped identify feedback and feed-forward loops between customers, suppliers, and the process, jumpstarting the TA team to begin thinking in terms of cause and effect.

Key benefits to the team are profiled in the exhibit below:

Value Stream Mapping A lean process tool, value stream mapping is a fundamental tool to identify waste, reduce process cycle times, and implement process improvement. Some organizations treat the value stream map as the hallmark of their lean efforts. The power of value stream mapping lies in looking at the entire business process. More importantly, the mapping process not only includes defining the current state, but also includes defining the future state and the gaps between the

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two. With a clear picture of how the entire process should operate in the future, it becomes relatively easy to identify the interventions that will close the gap. There are combustion points198 in every process. These are spots where even a finely tuned process can break down and instead of contributing to a positive customer experience, lead to value erosion. While it’s impossible to completely eliminate combustion points, they can be stopped from becoming explosion points. Identifying and controlling combustion points are an important part of delivering service through process and the best way to do this is to study your end-users/customers. The Value Stream Mapping exercise carried out by the team at Sigma – refer to exhibit below – helped identify these combustion points. It captured a recruiting process cycle efficiency level of just over 18 percent. The low process efficiency implied that process leaks were occurring at various stages of its recruitment process cycle leading to value erosion at the customer’s end.

198

http://www.amazon.in/Our-Guest-Revised-Updated-Perfecting/dp/ 1423145844/ref=sr_1_1?s=books&ie=UTF8&qid=1452956508&sr=1-1& keywords=Be+our+guest

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Process efficiency leaks199 could occur as a result of lack of standardization in process elements, talent acquisition tools and templates, missing service – level agreements, activities between process units, within the HR function or in interfaces with external service providers. Multiple touch points, integration and re-entry points in the process map were assessed for their contribution to the overall efficiency leakage. The exhibit(s) below capture the process leaks at various stages of recruitment process cycle. In essence, these were combustion statements – important clues to the following process issues Sigma needed to address to deliver quality recruiting service. • Hiring Service Flow to customers • Hiring Team-to-Hiring Manager communication • Unique hiring needs of business units/managers • Poor Process design.

199

Taleo Research White Paper – Hidden ROI of Talent Acquisition & Mobility, 2006.

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“Watch the little things. A small leak will sink a great ship.”– Benjamin Franklin

The stakeholders at Sigma probably took a cue from Franklin’s famous quote as they went about the task of evaluating the process leaks in terms of staffing and unnecessary expenses and finally the opportunity presented to maximize customer value. I believe that small things make a huge difference in business and would like to liken the process leaks to the metaphor of broken windows, about which Michael Levin writes in his insightful Broken Windows, Broken Business.200 The metaphor lets people imagine a broken window as a sign of a weak company or poor management style. And as Levine explains in his book, “An organization’s true priorities are revealed by the small stuff. Inattention to the little details, the tiny flaws, the overlooked minutiae on part of an organization is to send out signals that its approach is lackadaisical, its methods half-hearted, and its execution indifferent. The business in question could suffer severe – and in some cases, irreparable – losses.” 200

http://www.amazon.in/Broken-Windows-Business-Michael-Levine/dp/ 0446698482#reader_0446698482

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Sigma’s focus on process – the drive and ability to optimize the mundane – was founded on the belief that the backbone of quality hires was built on designing perfect processes and then repeating them at scale. At a broader level it was about creating the atmosphere based on what the end-users wanted. The Hidden ROI of Talent Acquisition: Lifting the Veil The total economic value of process efficiency leaks was arrived at by combining the cost associated with inefficient application of internal staffing resources with the inefficient use of discretionary spending (e.g. external partners, print and online advertising). A cost measure of the often under –leveraged opportunity: internal mobility201 was also included. Awareness of the total costs of talent acquisition and mobility drove home the tangible benefits possible through process improvements. The following exhibit from a White Paper by Taleo202 succinctly underscores this substantive value proposition to the Sigma stakeholders.

Within the canvas of the process optimization effort, the stakeholders were in broad consensus that if they focused their attention, in particular, on two key process areas it would notably impact the organization’s return on human capital investment over time. The following section examines the principal challenges across these two critical hiring components. 201 202

http://www.bersin.com/Lexicon/details.aspx?id=14856 http://www.onrec.com/news/news-archive/taleo-launches-taleo-research

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Assessments and Selections A 2009 CEB203 study found the total cost of poor selection (i.e., turnover costs + performance loss) was $28.5 million (assuming 2,500 new hires per year, with an average salary of $75,000). The underlying message: talent decisions have critical bottom-line consequences. Mindful of the hiring costs and its larger implications on the organizational success and sustainability, TA and HR leaders at Sigma had a real challenge going for them: finding, assessing and hiring more of the right candidates for critical leadership roles. The exhibit below aptly portrays this central challenge which required uncovering the hidden behavioural aspects, motives and traits to inform sound decision making on critical leadership hires.

The implicit message here was: “The need to measure the success of hiring managers in their ability to select the right candidates.” More importantly this was about assessing the right “cultural fit” – the idea that the best employees should match with organization values. But as Lauren A. Rivera204 wrote in a piece for The New York Times titled “Guess Who Doesn’t Fit In at Work”: When done carefully, selecting new workers this way can make organizations more productive and profitable. But cultural fit has morphed into a far more nebulous and potentially dangerous concept. It has shifted from systematic analysis of who will thrive in a given workplace to snap judgements by managers about who they’d rather hang out with. In

203 204

https://www.cebglobal.com/global-locations/ceb-india.html https://www.kellogg.northwestern.edu/faculty/directory/rivera_lauren.aspx

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the process, fit has become a catchall used to justify hiring people who are similar to decision makers and rejecting people who are not.205 This quite well mapped up to the hiring practices at Sigma, which lacked a robust assessment framework for evaluating potential hires. While resumes and experience influenced which applicants made it into the interview room, interviewers’ perceptions of fit strongly shaped who walked out with the job offers. Senior leadership at Sigma understood that a lack of evidence-based tools at the hiring manager’s end was not only allowing them to fall back into trusting their guts but also increasing the likelihood of hiring false positives.206 Towards laying a strong foundation for a science backed talent assessment program – together with human interpretation of the results, Sigma set out to find answers to questions that would form the basic framework for evidence-driven assessments: 1. What do we want to look for – traits, competencies, motivational fit? Need for Sigma to understand what made them successful in the past and present and the competencies and behavioural make up that would be required of its employees for future success. A good cultural and value alignment of the individual to the organization is critical. 2. What assessment tools to use and how to tell the difference between assessment services providers? The market for talent assessment tools is thriving today; data-based predictive decision making tools have never been more available. Choosing the right partner to help develop a good competency matrix is critical for success. 3. Are our people trained? Are we investing enough to train our leaders to assess talent? These are important investments in ensuring that welltrained people are taking the right decisions when it comes to talent spotting and development. 4. How would we leverage the data? Assessments generate huge data! There are rich insights to be gained by integrating pre-hire assessment data with post-hire performance data to create sharper developmental journeys with clear visible impact. 5. How will it reinforce our brand values? Organizations can make the assessment experience better for candidates by partnering with them to learn how to make the process easier and more valuable to 205

https://www.nytimes.com/2015/05/31/opinion/sunday/guess-who-doesnt-fit-inat-work.html 206 http://www.hire-intelligence.com/hiring-dangers-hiring-false-positive-candidate/

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them. Candidates today are looking for an increasingly immersive experience throughout the recruitment process and emerging trends of using gaming tools and work simulation techniques in assessments can help drive increased user engagement and reinforce an organization’s brand values. 6. Can it provide tangible ROI? It is important to be able to quantify the business impact of talent acquisition using key metrics like quality of hire, employee productivity in role, job performance, and future potential. Investing the time and effort to create assessment frameworks requires commitment and buy-in from the top management. 7. Are their legal compliance issues we need to adhere to? Assessments bring them an inherent fear of legal issues if not implemented fairly. Navigating compliance requires a clear understanding of the risk tolerance on the part of the organization. 8. Can they be seamlessly integrated into our existing workflows and technology platform? This necessitates sound planning and discipline in the development of an assessment strategy. Given the context of its business landscape and the pressure to get hiring and leadership development right, for Sigma it was no longer a question of whether to use talent assessments or not, but how to go about laying the contours of the right assessment framework and gain greater value and insight from the experience. Recruiting Technology Solutions A key deliverable identified in the process mapping exercise detailed in the previous section was the need for a unified technology solution: one which could manage all the elements of the recruitment process. There was broad consensus within the team that to deliver real value, recruitment operations must be supported by a software platform which manages all the elements of the recruitment process, focused on the needs of candidates, hiring managers, recruiters, as well as HR. The challenge here was not so much on the availability of such solutions but “picking” the right platform to mesh with its unique business needs. The scenario necessitated that TA and HR leaders at Sigma not only integrate third-party tools, build a workflow to source and assess candidates, and manage internal referrals and talent mobility, but also have access to analytics and data management to help monitor, improve, and optimize all this effort. Beyond the alignment of technology and processes, the team looked at criteria specific to the technology itself as detailed in the exhibit below:

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The mapping exercise provided valuable insights on the efficacy of Sigma’s current hiring process and supporting technology to maximize efficiency and productivity. It helped bridge inherent gaps to transition to the desired future state. This transition was triggered both by struggles to meet the needs of hiring managers with urgent turnaround requirements and by the leadership frustrated with losing high potential hires. The pressures created by these inside and outside perspectives resulted in a strategic reengineering effort that targeted their hiring rubric, refocusing it to increase customer intimacy.

13.4 Metrics & Measurement Evidencing “In God We Trust, Others Bring Data.” – W.E. Deming

Metrics, analytics, and indices are the language of performance monitoring and as the cliché goes: “You can’t improve what you can’t measure,” and by not measuring, the recruiting organization misses an important opportunity to learn from its own processes – what it is doing well and how it is adding value to the organization? Lack of a metrics-driven recruiting culture at Sigma and the excessive reliance on historical metrics was considered a major inhibitor in focusing limited resources on tools and strategies that have a significant business impact. Additionally, in the absence of hard data,

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stakeholders had a low appreciation on the value-add by the talent acquisition function. Leaders were of the firm opinion that for human capital insights to effectively solve business problems they must be supported by facts and data rather than on tradition, hearsay, or supposition. After spending time, money and resources on optimizing talent acquisition, it was important to demonstrate the business case. The following steps were considered key towards establishing an appropriate metrics driven hiring process:

The final step in creating a Talent Scorecard was seen as a way to elevate the visibility and importance of the talent acquisition function within Sigma and demonstrate a strong commitment to select and onboard the best talent relevant to its business needs. The stakeholders also deliberated here the common pitfalls (refer to exhibit below) to avoid in creating the right numbers and measures to include in the Talent Scorecard.

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Starting with the Right Questions The process of finding the right measures for the Talent Scorecard was not easy. There was an initial tendency to go too narrow, too quickly but subsequently the approach piloted around getting the bigger picture right and not identify specific metrics too early in the process. The big picture was centric around the market focus of Sigma group and the strategic initiatives planned to support its business goals. The next important step was to concentrate on the right questions to ask for the Talent Acquisition practice area and its alignment with the planned strategic initiatives. In formalizing a matrix of measures, the following list of questions was gleaned from research, best practices,207 and Sigma group’s historical data points.

The Strategic Filter With these questions in mind, the next step was to winnow the list based on the business goals and priorities. It is important to articulate the organizational context in the scorecard construct. For instance, an organization may not have a turnover issue or its younger workforce may obviate the need for 207

Adapted from “Talent Metrics that Matter”, Human Capital Institute, USA.

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retirement eligibility or the need to maintain deep bench strength. The talent scorecard can omit these factors. For Sigma group, a flexible recruitment delivery model to attract top talent for strategic roles to fuel its business growth plans was an imperative. Accordingly the next filter applied was to align the organization strategy and initiatives with the proposed measures. The draft scorecard thus prepared – refer to exhibit below – was shared with key business stakeholders for their inputs and buy-in. Building the TA Scorecard – A Representative Outline

Applying this strategic filter paved the way for creation of a Talent Scorecard of key metrics and measures that could be recorded, monitored and tracked. This ensured Sigma was better aware of its most significant talent acquisition practices and could accordingly guide its efforts and actions in support of attracting, engaging and acquiring critical organization talent. More importantly the data-centric approach helped elevate the overall customer experience. Making visible the myriad “behind the scene” recruiting activities through metrics and analytics – evidence-fuelled hiring – is what can measure the true value creation process and its impact on bottom-line results.

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Efficiency is a worthwhile goal, but from a customer’s perspective, data has far more power at the personal level. In order for customer interactions to feel individualized and human, they must be well informed. The best organizations see their people not only as individuals but also as a rich source of collective data that managers can use to make better decisions about talent.208 As I’ll share in the “Best Practices” section of the book, organizations such as Sigma that have used data to gain humancapital insights end up building a hard-to-replicate competitive advantage.

13.5 Strategy Holistic

A business’ talent acquisition strategy is both a plan and pattern of behaviour for creating and sustaining advantages in the markets where it competes to attract, engage, and onboard key talent. The strategy establishes a match between what an organization is capable of doing to meet business talent needs within the universe of what it might do, given the constraints and opportunities in the employment market-place. The starting point for any organization’s Talent Acquisition strategy is its overarching business strategy – the atmosphere in which a talent strategy breathes. From talent acquisition’s vantage “getting” the business strategy definition means thinking, questioning, and translating business goals into talent issues, needs, objectives, and initiatives for meeting those objectives. For instance, if the organization goals include cutting costs, then its talent acquisition strategy should seek ways to cut agency spend, change or renegotiate terms with external partners, increase recruiter productivity, reduce attrition or apply other cost optimization strategies. If the company is looking at expansion in new markets, geographies its talent acquisition strategy must reflect a localized character to create the desired talent outreach. A concurrent step here is to examine conditions both inside and outside the company. As David Sears writes in Successful Talent Strategies,209 Talent strategy builders need to objectively scan and assess: • Internal strengths and weaknesses related to the competencies, structure, processes, and current talent stock of the company. • External opportunities and threats presented by the markets for talent. 208

https://hbr.org/2010/10/competing-on-talent-analytics http://www.amazon.in/Successful-Talent-Strategies-Achieving-Market-focused/ dp/0814407463

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The Building Blocks This chapter delves into the basic building blocks of the systems thinking (ST) approach which was employed at Sigma in understanding the big picture view and the structural forces affecting the contours of its TA strategy. The ST methodology complemented the design thinking approach in many ways and was in specific employed by Sigma based on the premise that the adoption of a holistic understanding of social systems210 will be the key driver to re-design organizational systems such as talent acquisition and make them more resilient and responsive to change.

This timeless adage embodies the construct behind Systems Thinking211 – a discipline for seeing the wholes. It is a framework for seeing interrelationships rather than things, for seeing patterns of change rather than static “snapshots.” The real leverage in most business situations lies in understanding dynamic complexity not “detail complexity.”212 Creating a compelling employer brand, improving quality of hire, optimizing on costs and resources and satisfying key stakeholders through demonstrated business value was a dynamic situation confronting Sigma group. This scenario required seeing interrelationships rather than linear causeeffect chains and seeing processes of change rather than snapshots. The dynamics of creating the right alignment between the business goals and the TA strategy was captured using a systems thinking tool called causal loop diagrams. 210

https://hbr.org/2011/10/all-organizations-are-social-b Lannon C.P. “The Systems Thinker”, vol. 7, no. 3(Cambridge, MA: Pegasus Communications, Inc, 1996). 212 Senge P.M. Fifth Discipline: The Art and Practice of the Learning Organization (New York, 1990). 211

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Causal Loop Diagrams: The Essentials Within the systems thinking construct, causal loop diagrams, can be thought of as sentences that can be constructed by identifying the key variables in a system (the nouns) and indicating the causal relationships between them via links (verbs). A causal loop diagram consists of four basic elements: the variables, the links between them, the signs on the links (which show how the variable are interconnected), and the sign of the loop (which shows what type of behaviour the system will produce). By representing a problem scenario or issue from a causal perspective, one can become more aware of the structural forces that produce puzzling behaviour. The holy grail213 here is generating serious dialogue which can then produce shifts in mindsets and behaviour. It isn’t about getting the diagrams right, it’s about getting the process right. Getting the right stakeholders in a “safe environment” where they can start to discover the hidden consequences of their collective actions and challenge their own thinking. To help understand the interplay of factors that would influence the alignment of its talent acquisition strategy with the business goals, the team at Sigma leveraged the following causal loop construct:

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The CLD helped drill down the foundational issues that would impinge on the TA strategy of Sigma. This was followed by asking pertinent questions around these key components, such as outlined in the following exhibit:

A diagnosis of each of the above areas using multiple causal loop diagrams was considered a necessary next step. It helped draw clear interrelationship patterns and initiate changes wherever required. For a better appreciation the diagnosis exercise in one of the key success area – “TA & TM Integration,” is illustrated below. Detailed interactions with team members and stakeholders across the TM value chain revealed a less than optimistic picture and that something was inhibiting progress towards realizing greater coordination of efforts and integration among the constituent units. The causal loop construct in the diagram(s) below delineates the interrelated issues and the recommended leverage areas to improve the integration effort:

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The recommended leverage areas from the above causal loop diagrams included:

These causal loop constructs contained no judgment of what was right or wrong. They provided the coherence of relevant factors, the dynamic patterns over time. The reasoning and the leverage areas that followed by applying the systems thinking approach enhanced the leadership capacity for “seeing wholes” at Sigma. The result was not a set of elegant causal loop diagrams, but a new capacity for reflective dialogue, deep insight, and shifting entrenched mental models. It helped the leaders understand the most challenging issues affecting the complexion of their talent acquisition strategy and that small, well-focused actions can produce significant, enduring improvements.

CHAPTER FOURTEEN BENCHMARKING FOR SUCCESS

As the foregoing sections reveal, the selection and implementation of talent acquisition solutions and their integration with various talent management systems plays a crucial role in the ability to turn these strategies into vehicles for performance and growth. The picture which emerged through the lens of the strategy framework was an environment drawn between the forward-thinking and the status quo with visible gaps in the functionality and vitality214 of its talent acquisition practices. Organizations today are a blend of both characteristics, but understanding “Where are we today?” and “What do we know?” provided valuable insights on Sigma’s ability to compete for talent in the future and helped clarify its talent acquisition agenda. What is presented in the exhibit(s) below is a comparison of market-centric, result-driven approaches versus passive approaches that were in practice in each of these areas at Sigma group. 214

https://hbr.org/2007/06/make-your-company-a-talent-factory

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The Functionality dimension – the processes, systems, and tools that allow a company to put the right people with the right skills in the right place at the right time – shows that Sigma had its work cut out In the areas of sourcing, workforce planning, assessment processes, employment branding, and technology integration. Similarly, the Vitality dimension – manifested by the passion for talent acquisition among key constituents: top management, line management, HR and TA team, and the talent pool itself – shows that despite high commitment all the segments in Sigma group are weak on accountability and the top team is weak on engagement as well. Since a company’s talent acquisition process is only as strong as its weakest link, and vitality falls apart without mutual accountability, Sigma clearly had a lot of work to do.

Benchmarking for Success

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This composite picture of Sigma’s current talent acquisition practices and performance were subsequently mapped to a Competitive Framework based on a research study by the Aberdeen Group. The exhibit(s) below highlight the visible gaps which needed to be bridged to move along the continuum towards best-in-class.

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Process Maturity Capability – Sigma Group

Benchmarking for Success

The good news: there was a genuine intent to innovate and move towards best-in-class recruiting practices at Sigma group

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The Key challenges and expectations that emerged post-assessment of Sigma’s current talent operations are detailed in the exhibit below:

PART V ROAD-MAP FOR STRATEGY DELIVERY

The diagnostic exercise should pave the way for a road-map: the overall approach to overcome the challenges highlighted by the diagnosis. A clear roadmap consists of a set of guiding principles or rules – these are not instruction steps, but they are the “guardrails” on what needs to be done. It defines the domain of actions organizations should take (and not take) and the things they should prioritize (and not prioritize) to achieve desired goals. The strategy construct here must complement and draw upon the organization’s success tenets and exploit the inherent advantages. In laying down the roadmap, leaders as key architects of the strategy development and the implementation process, must understand when to exploit an established crop of strategies and when to encourage new strains to displace the old. However, this cannot be done in isolation from decisions concerning the stakeholders (employees, customers, suppliers) with whom the business will co-create and capture value. The guiding principles must be well communicated and adopted to generate the desired flow of organization energy towards the domain of action.

CHAPTER FIFTEEN TALENT ACQUISITION COE: LAYING THE FOUNDATION

Brand, Strategy, Structure, Process, and Technology predicated on design thinking principles represented an effective framework for assessing Sigma’s talent operations at a high level. For example, what often appear to be technology shortcomings are actually caused by an inadequate organization structure. Likewise, the inability to attract candidates as effectively as one may like may seem to indicate a weakness in the strategy or overall structure – when, in fact, the employment brand may be the root of the problem. The issues that challenged Sigma’s talent operations presented it with opportunities for improvement, and continuous improvement is essential when competing for talent. Its key framework elements worked together to create a complete talent picture, and so their workings were highly interconnected. Applying a holistic perspective wouldn’t have solved the challenge, but it helped make sure that the organization was asking the right questions that considered the complete workings of its talent operations.

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The foregoing sections highlighted the tactical and dispersed character of the talent acquisition function at Sigma and that much work needed to be done in terms of: • Improving the recruiting process efficiency. • Laying down and standardization of key metrics to quantify the ROI. • Creation of a shared knowledge repository within the function. • Bridging skill and competency gaps within the recruitment teams across group companies. • And overall promoting a clear line of sight on how talent acquisition should be evolved as a strategic function to qualify successful business outcomes. In line with the overall approach of aligning recruiting with business goals, the talent acquisition construct was designed specifically to complement and build on the corporate success tenets at Sigma exhibited below.

This template was then reduced to a “Recruitment Charter” that spelled out the Sigma group’s guiding philosophy by providing a clear sense of its scope, value-added benefits, and overall objectives.

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A thoughtful charter specifies the ends, but the means should be left to the executing team members. Telling the team what it should do and how to do it would only lead to wasted human resources. As J. Richard Hackman writes in Leading Teams: “When ends are specified but means not, team members are able to – indeed, are implicitly encouraged to – draw on their full complement of knowledge, skill, and experience in devising and executing a way of operating that is well tuned to the team’s purpose and circumstances.” The charter objectives paved the way for the creation of a Recruitment Centre of Excellence (COE) envisioned as the lynchpin of a business facing talent acquisition function. The key considerations that went into the creation of the COE included:

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The COE delivery model was in effect a distributed process arrangement where the recruitment process was delivered using a combination of different delivery models. The same is illustrated below:

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Implementing a new service delivery model is a major event in a company’s life, involving considerable change and disruption, particularly to staff members. While the financial and operational benefits of the TA COE model were understood by key stake-holders at Sigma, the optimization journey could only be negotiated with the right leadership alignment and the underlying culture fabric to strengthen this alignment. The following chapter throws light on the key leadership and culture imperatives in solidifying the foundational base for the envisaged COE.

CHAPTER SIXTEEN THE LEADERSHIP AND CULTURE IMPERATIVE AT SIGMA GROUP

The Essence of Reengineering At the heart of reengineering is the notion of discontinuous thinking – of recognizing and breaking away from the outdated behavioural norms and fundamental assumptions that underlie operations. Unless we change these beliefs, we are merely rearranging the deck chairs on the Titanic. As John Kotter wrote in his brilliant, The Heart of Change215: “People change what they do less because they are given analysis that shifts their thinking than because they are shown a truth that influences their feelings.” It is here that leaders who can strike the right emotional chord with their key constituents can successfully influence the change process. Re-engineering the Talent Acquisition function required extraordinary commitment from within the leadership ranks in various business units at Sigma including key HR and TA leaders. This leadership coterie was a credible guiding coalition of people with the right skills, connections and formal authority, whose singular mission was to help people see and feel “Why Recruiting is a Force for Good” which in turn could set the tone for the change process. The leadership imperatives identified included:

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Realizing the above outcomes required this team to demonstrate behavioural competencies different from their usual set of expected behaviours in ways that inspire others to choose to follow. Like Joseph Campbell’s famous “hero’s journey,”216 it meant going outside their comfort zone, to experience trials and adventures. The capabilities displayed in the exhibit below were considered integral to the overall competency mix for leaders involved in this change intervention.

Shaping a new culture is one of the most difficult challenges for a leader and most leaders struggle with it because it’s so difficult to define. Even less tangible than a “soft” concept, culture is more like a cloud: You know it’s there, but it’s nearly impossible to grasp.217 Leaders may not be able to sustain the change effort without investing to change the collective mindset of people. This collective mindset – that is, shared ways of thinking or shared cognitive patterns – has two powerful outcomes. It defines the way people behave, and it also determines what information people will accept, interpret accurately, and adopt as useful knowledge.

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http://www.amazon.in/Heros-Journey-Joseph-Campbell-Collected/dp/ 1608681890 217 https://hbr.org/2011/06/you-cant-dictate-culture-but-y/

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An organization whose culture cannot accurately perceive and interpret its environment and effectively translate those perceptions and interpretations into employee behaviours will have great difficulty staying in business.218 Such shared assumptions are the most fundamental and nonmalleable aspect of creating an optimized organization.219 In other words, leaders at Sigma needed to create a culture of optimization. This process of enacting the desired cultural change was both top-down and bottom-up. The following dimensions of culture – refer to exhibit below – were considered key towards creating an optimization mindset.

Leadership capabilities to enable more flexible and dynamic coordination of resources, stronger collaboration across business units, and communication in the midst of uncertainty were considered par for the course. And since many constituents were engaged in the changes alongside their day-to-day jobs, leaders at Sigma also had to figure out how to prioritize and stop lowvalue activities. In doing so, they had to tread through totally uncharted territory. The optimization effort, thus was as much a process of discovery and experimentation as it was of execution. But how do you come to an agreement on the essentials of creating a culture of optimization? And even if you do, how do you get people to think and act in the way you agreed upon?

218

Ibid. http://www.amazon.in/Organizational-Leadership-Jossey-Bass-BusinessManagement/dp/0470190604

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The answer is that you don’t. Even after thousands of years of civilization, leaders still have trouble getting220everyone to follow any basic precepts of behaviour – think the Ten Commandments.221 In other words, culture is not a “goal” to be mandated, but the outcome of a collective set of behaviours. Leaders, however, can influence those behaviours in several ways – and by so doing shape the culture of their organizations. Research underscores that changing behaviour is less a matter of giving people analysis to influence their thoughts than helping them to see a truth to influence their feelings. Both thinking and feeling are essential and both are found in successful organizations, but the heart of the change is in the emotions.222 The exhibit(s) below captures how the change champions at Sigma exploited the see-feel-change dynamic, a process popularized by John Kotter, that fuelled action by showing people potent reasons for changing the way they viewed recruiting and made them willing volunteers in facilitating the change process.

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https://hbr.org/2010/08/is-your-culture-too-nice.html Ibid. 222 https://hbr.org/product/the-heart-of-change-real-life-stories-of-how-peopl/an/ 13500-HBK-ENG 221

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The see-feel-change dynamic helped generate the rich and contextualized information Sigma could have gathered only by venturing out into the real world of its hiring experience. Without this texture of experience – what anthropologists refer to as thick data223 – the data shoved before people’s eyes would have lost truth. Context and colour would have been absent; all that would have remained would be abstract representations of its hiring world rather than the hiring world itself. Thick Data approaches reach deep into people’s hearts. And finally to make change really happen, it doesn’t need to be managed, but empowered. It is a Hobbesian paradox224 that we cannot enforce change unless change has already occurred. As Greg Satell wrote in this piece225 for Forbes: “Way back in 1969, while hippies were making their pilgrimage to Woodstock and Neil Armstrong was preparing for his 223

https://www.wired.com/2014/04/your-big-data-is-worthless-if-you-dont-bring-itinto-the-real-world/ 224 http://www.oxfordhandbooks.com/view/10.1093/oxfordhb/9780199791941. 001.0001/oxfordhb-9780199791941 225 http://www.forbes.com/sites/gregsatell/2013/04/02/4-ways-in-which-technology -is-transforming-business/#1e6a063e1514

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moonwalk, Peter Drucker was predicting the oncoming of a new age, which he called the knowledge economy,226 where managers would have to supervise subordinates who had expertise they themselves lacked. One of the key ramifications that he foresaw was that we’d have to treat almost everyone as if they were a volunteer. No amount of monitoring and auditing can suffice.” Higher status – or even a persuasive presentation of facts – is of limited utility. The lunatics run the asylum,227 and the best we can do as leaders is to empower them to run it right. One of the nobler aspirations of a workplace should be that it’s a place for refuge where people are free to create, build, and grow. The Leaders at Sigma understood this...

226 227

https://hbr.org/2014/10/what-peter-drucker-knew-about-2020 http://www.digitaltonto.com/2011/why-the-lunatics-really-do-run-the-asylum/

CHAPTER SEVENTEEN BUILDING THE TALENT ACQUISITION COE STRUCTURE

The primary objective of the recommended Centre of Excellence (COE) model within Sigma was to provide centralized delivery on core strategy and operational elements, while ensuring localized delivery of business specific recruiting services. It housed an infrastructure capable of delivering high volume tactical services, centralized recruiting knowledge base, and expertise to deliver best practices and standardized recruitment services. The COE had a scalable, flexible character with focus in three specialized areas – see exhibit(s) below: Sourcing – Focus on leveraging innovative technologies, savvy market analysis and targeted outreach strategies to attract the best available talent with the sourcing team responsible for building the talent pipeline.

Operations – Focus on the efficiency and effectiveness of the hiring process with the operations team responsible and accountable for the logistics and administrative components of the talent acquisition process.

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Recruiting – Focus on managing the candidate and hiring manager relationships to ensure right fitments and positive experience for all stakeholders and promoting a strong employment brand.

The specialized focus areas in the COE allowed the talent acquisition team to work as specialist consultants in areas of policy creation, process optimization, and strategy formulation. It was suggested that businesses do not lose sight of the tactical recruiting services whilst building confidence in the new delivery model. The scope of services provided, thus varied between the various group companies and their individual needs. A key factor which helped shape and influence the scope of services was the underlying technology supporting the COE. Implementation of a Global Applicant Tracking System (ATS) was a step in this direction.

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By providing the customers (all Sigma group companies) with one recruiting service touch point for all the tactical processes, the COE enabled a consistent, personalized service across multiple communication channels. The COE, envisaged as the main access link to clients seeking recruiting information electronically, made it imperative that the team members be customer-focused advisors who provide advice and guidance on recruitingrelated matters across the service chain, with the more complex enquires being passed through to Consultants and Project Managers to address. The COE was proposed to be governed by Service Level Agreements (SLA’s) to measure and monitor the overall effectiveness and efficiency of the services rendered, cascading down into internal process measures and individual team member objectives. However, as opposed to a traditional SLA structure, Sigma modelled this as an “Internal Guarantee”228 tool which could help break many of the persistent logjams, frictions, and communication barriers that so often occur in a “service provider – customer” relationship. Salient aspects of this approach are profiled in the best practices section of the book. The exhibit below captures a “representative scope of services” outline drawn up for the recruiting COE.

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https://hbr.org/1995/01/the-power-of-internal-guarantees

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Establishing a COE is a balance of art and science. Attracting talented people with the right technical skills and experience is just one piece of the puzzle. It was also critical for Sigma to create a centre that exemplified the best recruiting practices, aligned to the business goals, with consistent support and commitment from senior management. For a COE to provide value, it must address and support business needs. And, like any good partnership, the monitoring and reporting of its development and success needs to be visible to all. I will share more on this in the best practices section.

CHAPTER EIGHTEEN THE KEY RECRUITING TRANSFORMATION STAGES: SIGMA GROUP

Research shows that Recruiting professionals can spend up to 40 percent of their time on administrative tasks like data tracking, interview scheduling, and documentation related to offer generation. The introduction of the COE model at Sigma provided an opportunity to release recruiters and recruiting managers from process related activities, allowing them to focus their skills on the realization of departmental business plans and strategic issues within the organization. Improved processes and new technology integration helped administer the efficiency savings and service delivery desired through a focused operation. Over and above this, the transformation exercise enabled a new “business focus” dimension to the career of the talent acquisition team members leading to increased personal achievement and job satisfaction.

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Transforming the delivery of recruiting services is a complex multi-faceted program of work which impacts all parts of the organization. Transformation programs, which may include related activities such as hiring manager and candidate satisfaction, are typically delivered in a number of phases over an extended period of time. This period is determined by the complexity and scale of the transformation, its priority within an overall recruitment program and the organization’s attitude to risk. Research indicates that there are typically three main staging areas in an organization’s recruiting transformation journey leading to the creation of a Centre of Excellence (COE). The exhibit previous page captures this phase-wise journey of Sigma highlighting the salient aspects of each phase.

18.1 Phase I The first step of work is the Strategic phase, which usually occurs in early stages of the program and was covered in detail in the “Strategic Framework” section in Part III. Within this stage a strategic vision is set with change management initiatives in place to embark on the new model with new processes fully embedded within the organization, capable of providing professional recruiting services to all business units. A strategic plan is set

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to focus on efficiency gains which are made through process improvements, automation of manual tasks, innovation through new technology and rationalization of procedures. The Value Stream Mapping (VSM) of the current recruiting process – detailed in chapter 13.3 – revealed areas of low quality and helped identify “waste” to be targeted for elimination. The exercise allowed the recruitment team to produce a future state VSM that was free of the identified waste and non-value-added activities. In effect, the tool enabled the recruitment team to view the process – refer to exhibit(s) below – from the ultimate customers’ point of view, with the objective of accelerating or eliminating any activity that did not add value to them.

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If VSM represented the roadmap for Sigma’s Lean Recruitment journey, then 5S, a lean principle, provided the necessary fuel. To initiate the required culture shift, 5S was introduced in Phase I to serve as a foundation for all recruitment process improvements. These five essential principles – refer to exhibit below – for operating in a lean environment helped ensure process consistency.

Following the VSM and 5S, the TA team focused on the Kaizen opportunities.229 Early efforts in the Phase I to standardize processes and improve quality are captured in the exhibit below:

229

https://www.isixsigma.com/methodology/kaizen/kaizen-six-sigma-ensurescontinuous-improvement/

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Implementation roadmaps – including timelines and milestones – were developed for each process improvement opportunity and prioritized based on the business impact.

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18.2 Phase II The second step of the transformation was the Technology phase (Introduction of a Global TAS) and the rollout of the new reporting and metrics framework. The projected implementation period was spread over a five-month period. The stages and their overall impact are profiled in the exhibit below:

18.3 Phase III The third step of the transformation phase involved full operationalization of the COE model, a culmination of around 12 months of stage wise reengineering efforts. The phase was characterized by realization of cost savings and efficiency gains as a consequence of the re-designed processes, reduced headcount, and technology integration.

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18.4 The Final Phase The final step in the Optimization phase involved maintaining process improvements through continuous process control. It entailed making sure the recruiting process improvements continued to add value to the business units and the organization as a whole. A risk analysis for the new process was conducted using the failure mode and risk analysis approach (FMEA).230 An extract of this FMEA is shown in the following figure:

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http://asq.org/learn-about-quality/process-analysis-tools/overview/fmea.html

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The goal here was to make sure the right people and resources are in the right place at the right time to fulfill business needs. This is the stage when the talent acquisition function starts adding real value to the business by partnering and proactively bringing a business partner perspective to business decisions. Recruiting and HR strategies are well aligned with the business and returning people investment.

In order to optimize on the timelines and factor in the interdependency aspect of the recruiting process steps and enable desired cost efficiencies, the phase-wise transformation effort was run concurrently rather than as disjoint events. Way to a Successful Transformation Managing the transformation effort such as the one negotiated by Sigma was like trying to change the wheels on a bike while you are riding it.231 It required taking the recruiting function apart and putting it back in a new way, but ensuring that business kept running at the same time. It was a lot to ask and senior leaders at Sigma had to bear much of the burden. The critical role performed by its leadership was largely instrumental in steering the change effort on its rightful course. The following section briefly recounts what went into improving the odds of success. 231

https://hbr.org/2011/09/four-ways-successful-transformation-do

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Making the Transformation Meaningful A buy-in by employees into a change effort can spell the difference between success and failure. Senior leaders mustered the energy of their employees by making the transformation effort personal and openly engaging with them. “You have to put your face in front of people if you want them to follow you,” remarked a senior TA leader at Sigma involved in the change effort. Talk the Walk One of the most ubiquitous aphorisms in business is that the best leaders understand the need to “walk the talk” – that is, their behaviour and day-today actions have to match the aspirations they have for their colleagues and organizations.232 However, the change champions at Sigma also appreciated the need to “talk the walk” – that is, to be able to explain, in a language that was compelling to the involved constituents, why what they do matters and how they can expect to win. It was about developing a vocabulary of change that created a sense of urgency and helped everyone involved in the re-engineering effort understand what made Sigma special and what it takes for them to be at their best. Building a Strong and Committed Top Team This was about enlisting the right people on the bus in the right seats to initiate the change process. Change initiatives fail when senior leaders don’t see that their organizations are social systems. Organizations are defined by bundles of relationships, social expectations, and unwritten rules that exist between thousands of people. These people create tribes – collections of like-minded people who build patterns around how work gets done. This system is highly resistant to change, as anyone who has tried to “impose” change on a system knows.233 The success of change at Sigma was in great measure due to the ability of its leaders to understand these “fundamental units of influencers” and make allies of them. This approach created on-theground momentum around change, and helped with local integration at the regional levels, across geographies within Sigma drastically improving both the quality of the change initiatives, and their effectiveness.

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https://hbr.org/2014/08/the-best-leaders-talk-the-walk https://hbr.org/2016/09/overcome-resistance-to-change-by-enlisting-the-rightpeople

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Relentlessly pursue Impact Larry Bossidy, reflecting on leading a transformation of Allied Signal, wrote, “Many people regard execution as detail work that’s beneath the dignity of a business leader. That’s wrong…it’s a leader’s most important job.” This discipline of execution was exemplified well by senior leaders at Sigma, who understood that in a change effort where real value is at stake, there’s no substitute for simply getting involved in the details. Kicking of a transformation is one thing, but sticking with it is what really matters. In playing these four roles, while framing the transformation effort, leadership at Sigma helped fuel positive changes in its talent acquisition practices and processes over the long haul.

PART VI

VALUE CREATION THROUGH OPTIMIZATION

Crafting a forward-looking strategy is not about building gossamer cathedrals or esoteric plans but, as Richard Rumelt writes in Good Strategy Bad Strategy, about coherent action. “Only action has an impact on the situation at hand: influences, shapes, alters that which is. The kernel of a powerful strategy must be coherent.” That is the resource deployments, policies and manoeuvres that are undertaken should be well optimized to ensure capability maximization. Optimized organizations and functions ensure that resources are leveraged to their best potential to create the unique capabilities. This optimization effort results from the concurrent maximization of resource efficiency, effectiveness, and utilization. The strategic coordination or coherence at the core of the optimization effort is not about ad hoc adjustment but about fitting the pieces together so they work as an integrated whole. By planning improvements based on a strategy that encompasses all aspects of talent acquisition, organizations can achieve significant results in terms of cost, efficiency, and business impact.

CHAPTER NINETEEN TALENT ACQUISITION AT SIGMA GROUP – THE NEW PERSPECTIVE

The recruitment transformation effort helped Sigma embrace “Talent Acquisition” as a mainstream business function. This impacted all the areas in the Talent Management value chain, from building a strategic employment brand, through sourcing and recruiting, all the way to onboarding top talent. The character of the transformed function was stronger, with branding, talent pipelining, strong assessment practices at its core, and a cohesive integration with the business. Findings based on an Industry Leading Talent Acquisition framework234 made famous by Bersin By Deloitte – refer to exhibits below – underscored the fact that organizations need to bring a broad end-to-end focus to enable a composite view of their talent operations.

234

http://www.bersin.com/News/Details.aspx?id=15397

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The Bersin Talent Acquisition Framework, in particular, allows organizations to understand the strategic impact of talent acquisition in today’s business climate and how it fits into the broader context of talent management. Even if an organization’s talent practices, processes and supporting technical systems are robust and up to date, talent management will fail without a deep-seated commitment from senior executives. Passion must start at the top and infuse the corporate culture, otherwise talent acquisition processes can easily deteriorate into bureaucratic routines. The framework essentially highlights this fundamental precept, which formed the core of the new perspective at Sigma and helped optimize the function. This success in great measure lay in the group’s ability to marry functionality, rigorous talent acquisition processes to support strategic and cultural objectives, and vitality, emotional commitment of its key stakeholders. Mapping Functionality and Vitality at Sigma The functionality and vitality of Sigma’s re-engineered Talent Acquisition processes were pivotal to its ability to attract, engage, and onboard best-inclass talent. The figure(s) below illustrate the visible improvements in both

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the functionality and vitality dimensions as a consequence of the optimization effort. Readers may refer Chapter 14 towards a realistic appraise.

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The strategic elements at the heart of the new “Talent Acquisition Outlook” are profiled in the exhibit below.

Reimagining Hiring as a “Platform” The value creation potential of Sigma’s new “Talent Acquisition Outlook” was not only about better optimizing the hiring process but also more about creating a better platform for end-user fulfilment. When fulfilment processes become platforms, opportunities to segment talent pools, create targeted talent outreach and engagement interventions explode. Talent supply chains become more anticipatory and effective. Platforms, not processes, increasingly impact and influence user-experience. Platforms, not processes, are what empower processes to interoperate and productively interact.235 Integration was the operative word here. It was the work of bringing all the elements of the end-users’ hiring experience together to create a best-in-class hiring construct. When the elements of a system are properly integrated, the value of the entire organization becomes greater than the sum of its parts. To ensure the user-experience theme was being accomplished, the service standards and delivery systems were incorporated into an Integration Matrix. In other words: 235

https://hbr.org/2016/12/instead-of-optimizing-processes-reimagine-them-asplatforms

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• • •

How did the People deliver on Efficiency, Effectiveness, and Utilization? How did the Process deliver on Efficiency, Effectiveness, and Utilization? How did the Technology deliver on Efficiency, Effectiveness, and Utilization? The Integration Matrix was a helpful tool that guided Sigma through the analysis and improvement of its talent acquisition services. The matrix in the diagram below is a simple chart designed to track the distribution of quality standards through delivery systems. Integration Matrix

The ability to design a fresh and integrated approach to the end-user hiring experience was just one of the uses of the Integration Matrix. It can be used as a diagnostic tool to isolate, analyze, and brainstorm solutions to service lapses, or can also be useful as a benchmarking tool and analyze a competitor’s recruitment strategy. The level at which one can apply the

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matrix is similarly diverse. It can be used at the strategic level. For example, one can generate broad boundaries for the efficacy of recruitment practices by using it to analyze and improve the user experience at all touch points. The focus can also be narrowed to a single process level by aiming it at sourcing, response management, or assessments. One of the best features of the matrix is that it leaves room for more than one right answer when creating a great hiring experience. As we begin to use it to develop the features of user experience, each intersection of quality standard and delivery system will yield numerous alternatives. We may choose to implement one idea or all of them or any number in between. Now it’s time to pull back the curtain and take a peek into the best practices that Sigma was able to create by integrating the needs of people, the possibilities of technology, and the requirements of its business success or as Tim Brown of IDEO236 would have put it, “leveraging a design thinking approach to carve a path to hiring excellence.”

19.1 Best Practices – Recruiting Department Structure

The structure of an organization defines its realities and meaning, not only in terms of personalities (who reports to whom), but in terms of texture, form, flexibility, and duration.237 The TA and HR leaders at Sigma applied the principles of leverage, specialization, customization, and customer relationship management – see exhibit below – in laying down the new organization form of its recruiting department. 236

http://www.ideou.com/pages/design-thinking Dauphinais G. W. and Price C., “Straight from the CEO,” Price Water House Coopers (Simon and Schuster Inc., 1998). 237

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The best practices around the basic building blocks of this structure are profiled in the following section(s). A Question of Balance With varying refinements of language, the mission238 of most Talent Acquisition business units such as the one envisaged at Sigma is:

The Talent Acquisition function, thus must satisfy three goals of service, satisfaction, and success if it is to build a sustainable character – refer to exhibit below:

238

Adapted from Maister D., Managing the Professional Services Firm (The Free Press, 1993).

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In the background of this context, managing the function required a delicate balancing act between the talent demands of Sigma’s constituent group companies, their economic ambitions, and the realities of the people marketplace. Many factors played a role in bringing these goals into harmony, but one had a preeminent position: the ratio of junior, middle level, and senior staff in the team, referred to here as the leverage structure (see exhibit below). By leveraging its high-cost seniors with low-cost juniors, TACOE (Talent Acquisition Center of Excellence) reduced the cost to its customers, while simultaneously generating additional profit for the group. Striking an optimum balance on the proportion of juniors to seniors strengthened the COE’s customer appeal by lowering its service delivery costs.

The leverage structure was at the centre of Sigma’s recruitment offerings and was reflected in the way its recruiting team was structured to fulfil the varied nature of hiring mandates. The structure strived to achieve an optimum balance around major variables presented in the exhibit below.

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What Makes a “Good” Scheduling System? Scheduling decisions require a delicate balancing act among goals that often conflict – profitability versus quality service, short-term versus long-term benefits to the organization, putting the needs of one hiring manager before another, the morale and development of one team member over another. The operational outline to Sigma was to follow a scheduling system that ensured that all hiring engagements were managed by a team assembled on real assignment skill requirements, real capabilities, and real developmental needs. The exhibit(s) below239 detail the spectrum of hiring assignments and a typical hiring manager assignment scheduling system, conceived in structuring the TA team.

239

Adapted from Maister, D., Managing the Professional Services Firm (The Free Press, 1993).

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Team Structure for a Typical Hiring Assignment: Sigma Group

Scheduling has long-term consequences. Over time, the pattern of hiring mandates given to the recruitment team members profoundly influenced their professional development, their value proposition to the talent acquisition team and to the hiring managers, their satisfaction with the organization, and as a result their motivation and productivity. Viewed as a connected set of decisions, a judicious scheduling and allocation system played a larger role in dissemination of expertise throughout the team, acting as a primary vehicle for converting the experience and knowledge of these individuals into the experience and knowledge of Sigma’s recruiting function as a whole. The model also helped gauge the internal training requirements of the recruiting staff and accordingly draw up a learning and development roadmap for individual recruiters. In optimizing the training and development inputs to recruiters, selection criteria of the core recruiting staff played a vital role. A strong sense of initiative, high energy levels, an ability to thrive

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in pressure situations, and an “attention to detail” – an attitude that was essential if one had to find the self-discipline to handle client servicing with empathy – were key personal characteristics assessed in potential recruits. The leverage structure also enabled the creation of an In-House Candidate Search Model. The model envisaged staffing the sourcing team with specialist head-hunting roles (different from internal “recruiters”) to identify and engage with the senior leadership prospects for Sigma. This approach was also in sync with the TA goal of becoming a more analytic, strategic business partner by on-boarding the best talent in the market as against the talent available on the market. The exhibit below illustrates, in theory, the potential value of an internal headhunting effort in relation to other candidate sourcing methods. It also introduces the relationship between the actual cost-of-hire with the potential value of hire.

The in-house search focus not only helps in building rapport and relationships directly with the marketplace but also gather valuable market intelligence. This market intelligence could relate to the role being hired for or may serve as useful information that the business can use to its advantage. Over time the search model can build on the market knowledge, get closer to the competition and ultimately increase the probability of finding the best candidate in the market for every role, not just the best of the active candidates in the market.

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The result, for Sigma, was that its in-house search model helped find more than half of its hires, at a cost far lower than using outside partners, with deeper insight into the market, and while providing candidates with a warmer, more intimate experience. The overall recruiting organization structure resembled a hybrid model where much of the recruiting effort was characterized as a centralized function. The centralized recruiting not only included the traditional recruiters but also team members with a specialist focus in the areas of branding, technology, analytics, sourcing. Additionally the recruiting department developed a system to “customize” how it delivers on its service offerings. This was based on the unique needs of each business units and had dedicated recruiters assigned by business division in their areas of expertise. The exhibit(s) below highlight the salient aspects of the TA Centre of Excellence structure and its embedded business focus.

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This new look structure had positive implications for its overall talent strategy, which included among others: • Talent competencies centred on multi-function process oriented skills. • Talent strategies and initiatives delivered through a combination of Corporate and SBU interface. • Judicious mix of permanent and temporary talent employment. • Reduced barriers for talent deployment • Talent growth and development opportunities centered on hiring assignments. • Clearly defined and logical points of entry for new and experienced talent. The key and most impactful areas of optimization effected around the TA structure are profiled below:

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19.2 Best Practices – Recruiting Process Components “If you can’t describe what you are doing as a process, you don’t know what you’re doing.” – W. Edwards Deming

In the customers’ seat, recruiting services only have visibility and value if they improve customers’ lives or contribute to the customers’ success.240 This precept was a key enabler for Sigma to implement well-defined process rubrics at each stage of the recruiting life cycle to minimize time to productivity and maximize the quality of hire(s). Readers would recall the “Process & Technology” section in Chapter 13, which underscored that the end-users – the hiring managers and the talent prospect – of the hiring process are more concerned about the quality and timelines of the process outcomes than with the intervening process steps. Given this context it was imperative that Sigma’s repertoire of recruiting processes were strategy-ready in managing the talent flow – the right people at the right time with the needed competencies. The difference, much more than semantic, was organizing work both across the recruitment function and across the range of other business functions. The exhibit(s) below highlight the business functional areas at Sigma realigned to processes, and other salient aspects of their “best practices hiring approach.”

240

Adapted from “Successful Talent Strategies,” Sears D. (Amacom Publication).

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Setting a High Bar for Quality Superficially, every organization’s hiring process follows the same tired and weary path. Post a job. Get resumes. Review them. Interview Prospects. Hire one. Hit the hay… Dig more deeply, and the Sigma approach looks very different as soon as a new hire requisition comes up. There were six unique parts to their hiring process (refer to exhibit below), with the goal of ensuring that the bar for quality is never compromised and that the decisions were as free of bias as possible. The focus was on hiring people who might get overlooked following a conventional process than on moving faster. The process was designed to hire talent for talent’s sake.

A novel intervention here by Sigma was reducing the above hiring process into a hiring checklist – literally-written guide that could walk the hiring managers through the key steps in a complexity ridden hiring process. The belief was that, by performing every behaviour in the list, you could

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make “hiring for excellence” a reality rather than an empty phrase. Atul Gawande has written persuasively in The New Yorker241 and in his book The Checklist Manifesto about the power of checklists, where he argues that “Under conditions of complexity, not only are checklists a help, they are required for success. There must always be room for judgement, but judgement aided – and even enhanced – by procedure.” He walks us through a series of examples from medicine showing how the discipline has reached a stage, where complexity of knowledge has outstripped the human capacity to deliver and that checklists can help save lives. Reading this, I realized that hiring too is phenomenally complex. But if organizations could reduce great hiring to a checklist, implemented with discipline and rigour, they will have a distinct advantage in the years ahead. I will, next, take you through the decision steps in Sigma’s hiring checklist – (please also refer exhibit below) 1. Think through the assignment: An essential wisdom from Peter Drucker, it underscored the importance of understanding the assignment of the person they were hiring. Drucker tells the story of how during World War II, George Marshall would study the nature of the assignment before hiring division commanders. The reason? The tasks of raising and training a division and leading it for combat were two different assignments and each required a different kind of person. Failure to think through the assignment, Drucker observed,242 was the number one reason for hiring failures. Put differently, executives making hiring decisions must “match strengths to opportunity.” Not to be confused with a job description, this step required defining the critical outcomes and competencies the job required and recruit and judge what Sigma wanted a person to accomplish in a role. 2. Look at a number of potentially qualified candidates: The key here was deciding on the optimum number of “qualified candidates” needed to evaluate to make good hiring decisions. How do you know when to stop looking for candidates? While the same would depend on the nature of the assignment, it has been demonstrated both empirically and theoretically that the simple decision rule of “meeting a dozen” works well, even when sampling candidates from a very large population. 3. Think hard about how you will look at these candidates: In picking the members of their cabinets, Franklin Roosevelt and Harry Truman 241

http://www.newyorker.com/magazine/2007/12/10/the-checklist http://www.amazon.in/Classic-Drucker-Essential-Harvard-Business/dp/ 1422101681 242

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5.

6.

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said, in effect: “never mind personal weaknesses. Tell me first what each of them can do.” It may not be coincidence that these two presidents had the strongest cabinets in twentieth-century U.S. history. The quality of assessments is key here and the need to stay focused on the strengths of the candidates and if they are right for the assignment. A good assessment yields more than a good candidate – it can actually improve the company’s bottom-line and market value in a very significant way. The right interviewers, the right number of interviewers, and the right techniques all went together to define the character of Sigma’s assessment processes. Discuss each candidate with several people who have worked with them: This step is about tapping into the wisdom of the crowds with formal and informal reference checks. “One executive’s judgement alone is worthless. Because all of us have first impressions, prejudices, likes, and dislikes, we need to listen to what other people think,” writes Peter Drucker in his treasure trove of wisdom,243 when he cites this example: “Hermann Abs, the former head of Deutsche Bank, picked more successful executives in recent times than anyone else. He personally chose most of the top-level managers who pulled off the post-war German ‘economic miracle,’ and he checked out each of them first with three or four of the person’s former bosses or colleagues.” The step ensured that Sigma was reaching out to a broad spectrum of references – candidate’s former bosses, colleagues and subordinates to hire effectively. Granted, this is more difficult in today’s litigious world but is still doable. Formalize the selection process: This step was about ensuring the top candidates accept the offer. A show of commitment by senior organization functionaries, a realistic presentation of both the opportunities and challenges of a prospective position and fair compensation practices were considered key in ensuring higher offer-acceptance rates. Make sure the candidate understands the job: A systematic integration of the new employee is essential to secure long-term commitment and reduce turnover. It was the hiring manager’s responsibility at Sigma to make sure the candidate knows what their new responsibilities are and what the candidate needs to do to be successful in their new job. The integration plan laid down specific milestones and was backed up by regular progress reports.

https://www.amazon.com/Classic-Drucker-Wisdom-Harvard-Business/dp/ 1422101681

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7.

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Audit and Review: This step underscores the importance of a regular audit and review of the hiring practices. A great hiring and integration process will minimize, but can never eliminate, the chances of making a hiring mistake. Periodic reviews helped Sigma to keep the quality bar of hiring high and also helped identify hiring manager adept at assessing talent.

Performance SLA’s The Sigma recruiting team understood that hiring managers do not always respect or give high priority to the recruiting function and accordingly developed mutually accountable service-level agreements in consultation with line managers. These agreements helped build confidence among hiring managers that recruiting will come good on its promises and were used as a positive reinforcement tool rather than an enforcement mechanism in engendering a climate of mutual trust and goodwill to achieve the hiring objectives. As briefly explained in Chapter 17, the SLA’s were designed as an “Internal Guarantee” tool: a promise or commitment by one part of the organization to another to deliver its services in a specified way and to the complete satisfaction of its internal customers or incur a meaningful penalty.244 The penalty payouts were strong enough to be motivational 244

https://hbr.org/1995/01/the-power-of-internal-guarantees

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but not punishing and often executed in a spirit of fun. The purpose was not to encourage a public flogging but motivate the internal suppliers to make things right for the internal customers when the guarantee is not met. Like any performance improvement initiatives, internal guarantees offered distinct advantages that helped create change at Sigma: • They helped the TA team clearly identify their internal customers and determine their needs, defining in the process their own mission in the organization. • They provided a way of creating and sustaining involvement and empowerment among the affected constituents. Because internal guarantees require ongoing communication and input among groups, they push decision making, accountability, and an incentive for institutionalizing superlative performance down to the people responsible for delivering that performance. • In addition to their practical impact, internal guarantees had strong symbolic value. They declared, “We stand behind our work,” creating a well-earned sense of self-esteem among the talent acquisition and human resources team members who offered them. Sample Performance SLA’s

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Integration of the above elements in the performance SLA’s underscored the importance of the need for both Hiring Managers and the Talent Acquisition team to work as a well-knit cohesive unit. Recent research245 uncovered that “Developing strong relationships with hiring managers is the top driver of talent acquisition performance.” This finding is also supported by the fact that hiring managers take most of the workload during the candidate selection phase. An excerpt from an Industry leading Recruiting Roundtable Study246 is reproduced in the exhibit below.

245 “High Impact Talent Acquisition – Key Findings & Maturity Model,” Bersin by Deloitte (September, 2014). 246 Recruiting Roundtable, “The State of the Recruiting Function,” Corporate Executive Board (January 2006).

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Lean Supply Chain Tools in Recruiting The Process & Technology section in Chapter 13 examined in detail how Sigma went about adopting the basic tenets of lean in appraising the efficacy of its recruiting process. By embracing the fundamentals of Lean Manufacturing247 – identifying value-creating activities, eliminating waste, and focusing on continuous improvement – TA and HR leaders at Sigma realized that they could lift recruitment to new heights of efficiency and quality. Further, the initiative also gave business stakeholders more insight on the internals of the hiring process and its ability to make a visible bottom-line impact. The exhibit(s) below capture the salient aspects of the re-engineered recruiting process and the areas of impact across the talent supply chain.

247

http://www.toyota-global.com/company/vision_philosophy/toyota_production_ system/

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Ultimately, the lean tools and principles employed at Sigma was about providing smart, deliverable data to the business stakeholders and then saying to them, “Here are not only the benchmarks we started with, but here are the additional efficiencies we can deliver.” The key steps in their lean implementation journey are profiled in the checklist below. The same could also serve as a template for organizations aiming to put their priorities and “lean plan” into action with the end goal of achieving operational excellence in their recruiting approaches.

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Good to Green Most leaders know how they respond to the challenge of sustainability will profoundly affect the competitiveness – and perhaps even the survival – of their organizations. Over the past 15 years, environmental issues have steadily encroached on businesses’ capacity to create value for customers, shareholders, and other stakeholders. As this HBR article248 points out: “Externalities such as carbon dioxide emissions and water use are fast becoming material-meaning that investors consider them central to a firm’s performance and stakeholders expect companies to share information about them.” What this adds up to is that organizations can no longer afford to ignore sustainability as a central factor in their long-term competitiveness. “A key driver in their sustainability strategy is the need to recruit young talent: The best potential recruits want to be part of a company doing something meaningful and effective. And being green is also a matter of economic survival, as concerns around climate change, natural resource depletion among others escalate.”

Sigma’s Green Bias in recruiting was a natural extension of its business presence in the environment management space. Awarded the “Best Company” for two years in the running for market leadership in the 248

https://hbr.org/2010/05/the-sustainability-imperative

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Industrial Waste Management domain in India, the environment stance of the group was a critical element of its sales pitch to potential applicants and candidates. Making “greenness” an important element of its employment brand added a talent attraction and talent engagement dimension to it: “which is that people should feel good about being part of a company that is giving something back to the world.” It helped the group attract more of the Gen Y and College grads – a generation which has grown up with a “green mindset,” learning about environment and recycling since elementary school – for its entry-level volume hiring. Additionally automating the recruitment work flow and information flows – and making it green led to direct cost savings and made good economic sense. These savings came from reduced paperwork related to resumes, advertising, and on-boarding. Introduction of a Global Talent Acquisition System (TAS) delivered through a Software-as-a-Service (SaaS) platform, which was inherently greener than purchased software running on local servers, helped create a redundant computing environment with smaller carbon footprints. These best practices significantly increased the overall effectiveness, efficiency and utilization of resources to maximize the quality of hires at Sigma. Business process redesign, contrary to popular belief, is not a mere automation of tasks to reduce cycle time or human effort.249 It transcends to the identification of non-value adding activities in a process that can be obliterated to achieve dramatic improvements in critical, contemporary measures of performance such as cost, quality, service, and speed.250 Sigma’s recruiting process redesign was testimony to this precept.

19.3 Best Practices – Workforce Planning Process “Life is what happens to you while you are busy making other plans.” – John lennon

The Leadership team at Sigma probably drew a cue from this famous John Lennon line251 in evolving their Workforce Planning practices. It became a key weapon in their recruiting arsenal and helped provide predictive and precision forecasting capabilities in direct contrast to the earlier planning 249

Hammer M. “Reengineering Work; Don’t Automate, Obliterate,” HBR, July/ August 1990, pp. 104–112. 250 Hammer M. and Champy J. “Reengineering the Corporation: A Manifesto for Business Revolution” (Harper Collins: London, 1990). 251 https://www.youtube.com/watch?v=q8NWrIlBSYA

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model (refer to exhibit below). Its traditional workforce planning model more resembled the “Dodge Dart of the 1960s and 70s”252 – a basic, get-you-there model without any bells and whistles. While a reliable and functional model, the changing business environment and demands of a global business outlook necessitated a forecasting method better aligned with the strategic business planing and budgeting exercise at Sigma.

Tackling Talent Strategically Failing to manage your company’s talent needs, says Wharton management professor Peter Cappelli, “is the equivalent of failing to manage your supply chain.” And yet the majority of employers have abysmal track records when it comes to the age-old problem of finding and retaining talent. Most companies still approach workforce planning as an annual exercise in which personnel spending is managed as a cost without considering the skills or talent needed to meet business objectives. In the war for top talent, workforce planning is the War Room of HR.253 As the cornerstone of strategic human resources, the workforce plan certifies that talent management strategies run parallel to the business goals. As workforce plans hinge on effective forecasting, analysis, and preparation, the failure to craft and implement an effective one will almost certainly deliver an adverse impact to a company’s ability to attract, develop, and retain talent. 252

http://www.richmondchryslerdealer.com/history-dodge-dart.htm http://www.forbes.com/sites/sylviavorhausersmith/2015/05/25/workforceplanning-the-war-room-of-hr/#586754bf7373

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Sigma’s new workforce planning model integrated elements of Workforce Analytics, Segmentation, and Scenario-Modelling. It helped pinpoint with precision its staffing needs and develop staffing supply chains, training programs, and succession plans in accordance and to meet its future business needs at least three years in advance. A distinguishing feature of the model was an interactive forecasting method which relied on detailed interactions with all key business stakeholders and their workgroup units. This helped generate sharper insights factoring multiple scenarios around the workforce forecasts. Similar to the Delphi Method,254 it was based on the assumption that group judgments are more valid than individual judgments. The new model also added a competitive differentiation dimension by tracking the market and gaining insights on key competitor activity. The process in particular factored in a host of qualitative variables that were never part of the previous model: ‡ Industry Trends ‡ Changes in Labour and Employment laws ‡ Political Developments – both local and overseas markets ‡ New Business Strategies ‡ Data from talent management systems, including competency and performance ratings, training and developent history, mobility preferences, and career plans. Combining end-user based demand planning with predictive supply analytics helped Sigma manage uncertainty better by recognizing it, providing a sense of how its talent needs could vary based on changes in its business context. “The idea that we can achieve certainty through planning is no longer true,” Cappelli states. “Instead, we have to deal with uncertainty by being more responsive and adaptable.” And this requires knowing the costs of being wrong with our forecasts: Not enough talent or too much. As he writes in his book255: “In the language of operations research and supply chain management, these problems of undersupply and oversupply are collectively known as mismatch costs.” The insight comes from the fact that the costs of being wrong in each of these two directions are almost never the same. The goal in supply chains and in workforce planning is the same, to deliver just the right amount of supply to meet demand, neither falling short nor going over. That goal proves almost impossible to do. 254

https://www.hr.com/en/communities/human_resources_management/delphimethod_eacumpm1.html 255 http://www.amazon.in/Talent-Demand-Managing-Age-Uncertainty/ dp/1422104478

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The challenge then for Sigma was to reduce the odds of being wrong and prompted it to leverage a technique from operations research – the ”portfolio approach,”256 whose goal is to minimize the variability that occurs when different markets are headed in different directions. In the financial world, investors create a portfolio of diverse investments where some are likely to be up when others are down in order to reduce their overall risk exposure. Applied to Sigma’s context, the concept meant balancing out the kind of errors that might occcur by encouraging its group companies, business units to coordinate their talent development efforts into one common program. “When some divisions overshoot demand and others undershoot it, we could offset the mismatch by moving candidates around,” reflected a HR leader at Sigma. The exhibit(s) below capture the salient aspects of the model. A Sample Workforce PlanningTemplate employed at Sigma to project hiring needs based on terminations, expected retirements, and projected growth needs is also presented. The same was benchmarked, factoring Industry research data257 around workforce planning best practices.

256 257

https://hbr.org/2008/03/talent-management-for-the-twenty-first-century Journal of Corporate Recruiting Leadership | crjournal.com | August 2007.

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Generating Better Forecasts The biggest challenge to workforce planning, which Sigma was able to overcome was to get its leadership to believe that it is an organization initiative and not a HR or a TA intervention. The key here was to move from a top-down planning to a bottom-down planning approach facilitated by technology. It allowed end-users to evaluate various factors in defining the talent demand for their business areas. Another challenge here was grappling with the increasingly disparate and complex data around its growing workforce. This required a dedicated focus to maintain data integrity and reliability and necessitated acquiring the analytical and interpretive skills to transform this data into meaningful outputs. A key intervention here was hiring HR specialists who were adept at data modelling, interpretation, and forecasting. The leadership commitment to invest the time, money, and effort including deploying the right technology architecture and analytic capabilities helped realize the benefits of the most appropriate workforce planning techniques. Analytical workforce planning processes centred on expert forecasting, scenario planning, and extrapolation techniques formed the core of the new model enabling Sigma to work into the future with the most optimized workforce to support its business context.

19.4 Best Practices – Metrics & Measurements

A business organization without financial measures such as earnings growth, cash flow, return on equity, and return on sales is unlikely to be a viable business for long. However, the focus of these measures on past results (what was) versus ongoing process (how things are working as indicators of how they might improve) may create blind spots, particularly in customer-focused strategies such as for Talent Acquisition. The metrics and measurement section in Chapter 13.4 highlighted some of these

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pitfalls as also the fact that the most commonly used recruiting metrics are “historical metrics” with their almost universal focus on costs and process efficiency. Additionally, there is a temptation in organizations to report on too many metrics, which may have the purported effect of projecting a pretty picture but in reality they use up key resources and offer little value or business impact. Faced with numerous measurement options, the TA and HR leadership at Sigma went about the task of building a high impact measurement repertoire in a purposeful, systematic, and selective manner. This approach – refer to exhibit below – ensured that both financial and process measures were considered; that different value criteria of external and internal stakeholders are taken into account; and that offsetting improvements and setbacks (short-term financial results, for example, coming at the expense of operational quality and customer relationships) were equally visible.258

With the above considerations in place, let’s move on next to the steps that Sigma took with a “clean measurement slate”259 – as a way of auditing the value of current process metrics (the ones which are ineffective or are

258

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redundant) and identifying missing measures. Readers may like to refer back to the metrics and measurement section in Chapter 13, on how the Sigma decided to step back and rethink the measurement game in the background of a shifting talent market. The measurement slate employed the following steps:

The balancing considerations coupled with this clean state approach to developing the process measures finally paved the way for a “Talent Acquisition Scorecard” construct presented in the exhibit below. Talent Acquisition Scorecard Construct

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The predictive capability of this scorecard was spun around a clear understanding of the “hierarchy of knowledge” about data, metrics, and analytics.260 This pathway was not a straight leap to analytics but a hop (data), skip (metrics), and a jump (analytics) to enable true insights in how Sigma went about executing a data – driven TA strategy.

This matrix of metrics created served as a performance based measurement and management framework, linked to talent strategy, which tracked and guided action in support of acquiring, engaging, and on-boarding critical talent. A TA rule book was constituted and shared with all stakeholders, and analytics from the Talent Acquisition System (TAS) was used to publish and circulate regular reports on mission-critical metrics. This enabled decision makers a “quick read” on the current situation and helped determine where action must be taken to ensure the desired talent and business goals were effectively met. The array of metrics defined in the TA scorecard had one clear focus: evaluate the performance of the TA function, not by historical metrics alone but by the value it creates in improving that elusive concept of “quality of hire,” which at the end of the day that is what really matters. Delivering candidates who are better today than they were yesterday.

We next profile in the exhibits below some key categories of reporting dashboards created and utilized by Sigma in acquiring critical talent. 260

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19.5 Best Practices – Pre-Hire Assessments Hiring is hard for the same reasons that dating is hard: Both sides are in the dark.261 “The fundamental economic problem in hiring is one of matching with costly search and bilateral asymmetric information,” Paul Oyer and Scott Schaefer wrote in “Personnel Economics.”262 In other words hiring is expensive, time-consuming, and inherently uncertain, because the hirer does not know what talent would be the right fit and talent does not know what hirers would be the right fit. But it is not as hopeless a situation as it appears. Like any consequential business decision, hiring has been exhaustively studied. Organizations with the most successful hiring practices turn to various forms of assessments. Assessment helps organizations make better decisions about hiring and developing people, and the best assessment techniques align with the business purpose objective. Specifically, an effective evaluation process reduces error, when making decisions between candidates and increases the probability that the selected individual has the right mix of skills, motivations, and experience to succeed in a new role. While there are many assessment options available, the contribution of each is best understood by considering whether the tool is predictive of how the candidate may behave in the future or provides a “sample” of expected future performance. A Global Selection Forecast study by DDI263 revealed that the most widely used tools in organizations worldwide are screening interviews, resume screening, and behavioural interviews (see exhibit below). 261 https://www.theatlantic.com/business/archive/2016/04/the-science-of-smarthiring/477561/ 262 http://www.nber.org/papers/w15977.pdf%20 263 http://www.ddiworld.com/resources/library/trend-research/global-selectionforecast-2012

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As the data shows, there is a pervasiveness of reviewing online information to evaluate candidates, rather than using proven methodologies such as cognitive ability tests, simulations, and motivational fit inventories indicating a need for organizations to re-evaluate their assessment processes. Which Tools and How Many? Unfortunately, there is not one simple or universal answer to the question of which tools are the right tools to use. Effective pre-hire assessment is about predicting human behaviour, and no single tool can do this effectively as using many. Studies show that the selection of the right tools inventory should be based on the results of job analysis so that the tools can provide critical information directly related to the knowledge, skills, abilities, and experience it takes to be successful on the job. For example, if technical skills are crucial for successful job performance, knowledge tests will be an important diagnostic tool. If tenacity, persevering is crucial, personality and motivational fit inventories will have higher predictive ability. Similarly on the question of how many tools to use in predicting successful hires there are no defined answers. The general consensus is “the more the better.” Organizations that use more than three tools rated their overall selection system as effective (refer to exhibit below), because it

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allowed for a more comprehensive insight about candidates and the ability to better predict on-the-job performance. Balancing the “need to know more” with “knowing more in an efficient way,” is the key to making better hiring decisions as it reduces the risk by gathering more intelligence about whom to hire.

Assessing Talent: The Upshot from a Century of Research In 1998, Frank Schmidt and the late John Hunter published an analysis of 85 years of workplace productivity data to identify which employee selection methods were best and worst as predictors of job performance. They used a method called “meta-analysis”264 to do this. The advantage of this method is that it reveals overall patterns by the weight of evidence, rather than the particular quirks of any study. Schmidt and Hunter looked at 19 different assessment methods265 and found that work sample tests (e.g., seeing if people can actually do key elements of a job), general mental ability (combination of raw intelligence and learning ability that will make most people successful in most jobs) and structured interviews (behavioural or situational in nature, they assess a candidates quality of responses to a consistent set of questions) had the highest validity of all methods examined. They also pointed out that combinations of assessment techniques are better than any single technique and that the three combinations of methods that were the most powerful predictors of job performance were GMA (26 percent) plus a work sample test (29 percent), GMA plus an Integrity test (16 percent), and GMA plus a structured interview (26 percent). Unstructured job interviews, a widely 264

https://home.ubalt.edu/tmitch/645/articles/2016-100%20Yrs%20Working%20 Paper%20for%20Research%20Gate%2010-17.pdf 265 Schmidt F.L. and Hunter J.E. The validity and utility of selection methods in personnel psychology: Practical implications of 85 years of research findings, Psychological Bulletin, vol. 124 (1998), pp. 262–274.

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used selection tool are pretty bad at predicting how someone would perform once hired. They have a predictive ability to explain only 14 percent of a candidate’s performance. Back in 1963, behavioural scientists Marvin D. Dunnette and Bernard M. Mass wrote, “The personnel interview (read unstructured interview) continues to be the most widely used method for selecting employees, despite the fact that it is a costly, inefficient, and usually invalid procedure.” The deep dark secret of human resources is that unstructured interviews don’t work.266 So what assessment techniques did Sigma use? The goal of its hiring process was to predict how candidates will perform once they join the organization. To achieve this goal they did what science said: create an assessments program combining structured interviews with assessments of cognitive ability and leadership. Switching to structured interviews was a clear choice for Sigma because they were much more predictive of future performance. To help the hiring managers, they developed structured interview guides. Based on the job attributes the hiring managers wanted to test, the interview guide made it easy for them to find and ask great interview questions designed to predict performance for the job. Examples of interview questions included: ‡ In the past one year what have you done in order to remain knowledgeable about the competitive environment, market and trade dynamics, products/services and technology trends, innovations, and patterns of consumer behaviour? ‡ Have you significantly “raised the bar” for yourself or others? Explain how you did it – your approach, the problems encountered, and the outcomes? ‡ Are you familiar with the term “active listening”? How would you define it? What would your co-workers say regarding how often and how effectively you use active listening? The generic nature of these questions may lead one to question their efficacy, but it’s the responses that qualify the distinction between an average and a superlative candidate. Invariably above average candidates will come out with well-researched, carefully reasoned answers providing a reliable basis for assessments. Sure, it can be fun to ask, “How would you describe a human to a person from Mars?” or “If you were a cartoon character, which one would you be and why?”– real interview questions from other companies – but the point

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is to identify the best person for the job, not to indulge oneself by asking questions that trigger our biases. Laying out a sound interview design was followed by steps to ensure high-quality interviewing by involving the right number of highly trained and motivated interviewers. The importance of this step cannot be emphasized enough, when one considers the fact that the vast majority of managers and leaders have not received the proper education and training in assessing others. Research267 shows that new hires who reported their hiring manager and staff interviews to be effective were more confident in their decisions to accept the job offer, more engaged, and less likely to be looking for other jobs (refer to exhibit below):

Imparting Interviewing Skills Interviews remain the key decision-making tool for every job. To ensure this tool was properly leveraged and optimized Sigma instituted best practices in its interviewing process. Meta-analysis of 120 interview studies with a total sample size close to 20,000 has shown that training helps develop interviewing 267

http://enviableworkplace.com/claudio-fernandez-araoz-attributes-to-look-forwhen-hiring-executives/

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skills not only for structured interviews, but even for unstructured interviews.268 Consider the following best practices template created by Sigma: • Review of the selection process as part of the interviewer training was made a de riguer. This involved thinking through the success profile for targeted jobs. The process also helped interviewers know if they were correctly judging candidates, nudging them to look back at their interview notes and learn from what they spotted or missed. • Role-playing was made an integral component of Interviewers training. Research has shown that training programs – with role-playing exercises, feedback, and videotaping – can significantly improve questioning techniques, interview structure, and active listening skills. • Training of Interviewers to measure motivational fit in the interviews, thus reducing new-hire turnover. • Training of Interviewers to consider the impact of interview on the candidate. Candidate experience was considered critical to the employer value proposition. • Ensuring interviewers calibrate their candidate’s ratings on the targets covered in the interviews and their candidate comparisons to make final hiring decisions. The “wisdom of the crowds” prevailed here with emphasis on evaluating a candidate’s performance on their average scores. This added the virtue of eliminating the ability of any single person to blackball any candidate, as well as limiting anyone’s ability to canvass strongly for a candidate. • Reinforce interviewing skills, post training, through on-the-job coaching, virtual skill practice sessions. Using well-validated, highly predictive assessment tools can give organizations a significant leg-up when trying to select candidates who will become top contributors for the organization. However, all assessment tools are not created equal. And some will not offer a significant return on investment. According to a 2014 Aberdeen study,269 only 14 percent of the organizations have data to prove the business impact of their assessment strategy. Knowing which types of assessments will be most effective in accomplishing its specific objectives enabled Sigma to devise a robust assessments program with a measurable impact on the bottom line.

268 Huffcutt A. I. and Woehr D.J. “Further Analysis of Employment Interview Validity: A Quantitative Evaluation of Interviewer-Related Structuring methods,” Journal of Organizational Behavior, vol. 20 (1999), no. 4, pp. 549–560. 269 http://www.aberdeen.com/login/?doc=/launch/report/research_report/9043-RRmeasuring-assessment-success.asp

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If we turn back to the findings suggested in Chapter 3, the most common reasons for hiring errors all have to do with the decision making process. Too much reliance on a hiring manager’s evaluation; insufficient data to make a decision; candidates over-promising on their capabilities; and hiring managers having trouble bridging the knowing-doing gap. While there is nothing wrong with gut feel, hiring decisions must draw on a broader portfolio of data and insights to ensure that decisions are not an outcome of voodoo hiring methods and ultimately serve the best interests of the individual and the organization. As Malcolm Gladwell wrote in Blink270: “Prejudice and bias can operate at an unconscious level, even in individuals whose conscious attitudes may be very different.” The experience of Google and others of their ilk increasingly suggests that there are no magical hirers in the world. There are no performance oracles who just know a good candidate when they see it. The art of assessments combined with the science can help us Know More and Guess Less and get ahead on the road to hiring excellence.

19.6 Best Practices – Technology “The first rule of any technology used in business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency.” – Bill Gates

The wisdom of this maxim was not lost upon Sigma, who viewed new technology less as a complexity issue and more as an agent of positive change aimed at enhancing service in all aspects of the candidate, employee and hiring manager experience. This view was important to set the direction necessary to ensure a seamless integration of all of their recruiting processes, services and applications and utilize the very best technology solution in addressing their specific recruiting challenges. Properly done the recruiting technology could serve as a hub for talent management. Done poorly, the end-users could end up with a Rube Goldberg271 solution, involving an array of disparate products. Efficient, uniform operations are table stakes in modern business environment. We rely on carefully crafted systems, policies, and procedures to reduce the cost of doing business and ensure a consistent experience for

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us. And the truth is we’re all fascinated by complexity; Rube Goldberg like mechanisms full of convoluted twists and turns that use chain reactions to complete simple tasks. The New Yorker writer Adam Gopnik, who penned the preface of The Art of Rube Goldberg, put this succinctly, when he said, “We love the idea of mechanisms. One thing touches another thing, which touches another thing, which boots something else, which makes something else jump.” These ideas can give us a good laugh, but to build a technology platform in this gratuitously complicated way would be akin to planning a fail. Don’t Rube Goldberg Your Recruiting Technology So how did Sigma keep its recruiting technology from becoming one that must (to quote Rube Goldberg, who was born on July 4, 1883) “go to a great extreme to accomplish very little”? In adopting a “best of breed” approach the TAS (Talent Acquisition System) strategy outlook went down to the technical level. It ensured that Sigma did not end up building a bunch of silos that makes sharing data and managing, updating, configuring, and reconfiguring all the moving parts within its TAS a time-consuming nightmare. TA and HR leaders not only looked at the individual dimensions of their enterprise technology framework, but also the way these different dimensions e.g., Information Technology Infrastructure, General Purpose Information Technologies, and Recruiting Process Information Technology interacted with each other. The same is illustrated below.

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The key criteria discussed in the technology appraisal phase – refer Chapter 13.3 – ensured that Sigma’s recruiting technology platform of choice was really an “integration platform”272 which not only is used to track incoming resumes, but also connect to sourcing tools and services, assessment tools, video interviewing platforms, job boards, social media channels, and external talent supply partners. The recruiting software at the heart of the implemented system leveraged emerging recruitment technologies based on clear business outcomes. Salient features of this technology platform are profiled in the exhibit(s) below.

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Successful technology enablement of key recruiting processes lay in envisaging the ATS as a core part of its TAS Infrastructure integrated with other “value-add” parts of recruiting in the areas of sourcing, candidate relationship management, assessments, referral marketing, and interview automation. All these business areas were like planets in the solar system of talent acquisition and to some degree the ATS was the sun. Maximizing Return on Talent The recruiting industry is marked by constant change and innovation. While this provides organizations with new ways to connect and engage with top talent, keeping up with these changes can be overwhelming. The technologies themselves are complicated to configure and test, and changing people’s behaviour and attitudes towards technology is even more challenging. But for Sigma, to remain competitive, a firm understanding of the latest market trends and a realistic appraise on the best case technology offerings in the recruiting space was considered integral to its efforts to maximize the return on talent. A study273 conducted by Erik Brynjofsson with Wharton professor Lorin Hitt in 2005, found that organizations successfully using IT were significantly more aggressive in vetting new hires: they considered more applicants. They scrutinized each one more intensively. They involved senior management (not just HR) early and often in the interview process. After identifying top talent, these firms invested substantially more time and money on both internal and external training and education. Furthermore, they gave their employees more discretion in how to do their jobs while linking their compensation and rewards – including promotions – more tightly to performance using a suite of metrics that was more detailed than their competitors’. The costs of managing talent in his way may be high, but the payoff increases exponentially if you can leverage the talents of a high performing manager at one location to maximize the results in thousands of sites worldwide. The opportunity for Sigma to IT-enable its recruiting processes did not render obsolete all previous assumptions and insights about how to recruit talent, but it did open up new vistas for talent outreach.

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CHAPTER TWENTY RESULTS PRODUCED BY THE RECRUITING TEAM AT SIGMA

While laying down best practices around the strategic TA elements was a laudable effort for Sigma, the real fruit of their labour was in the significant results these practices produced. The positive ROI and lowering of the total cost of ownership helped elevate Sigma’s competitive advantage in attracting top drawer talent. The exhibit(s) below showcase both the financial and strategic impact of this effort.

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Results Produced by the Recruiting Team at Sigma

Process Maturity Capability, Post Re-engineering Sigma TAG

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The technology enablement by way of introduction of a Global TAS platform involved a number of components e.g., database building, digital marketing of opportunities, social recruiting, and employer branding, among others. Multiple benefits included better quality of hires, reduced advert spend and optimization of external hiring costs. A cost-benefit analysis and a five-year projected ROI for the TA optimization effort, prepared by the Sigma project team is presented in the exhibits below.

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The payback was achieved at the end of Year 1 in line with the projections and the realization of positive cash flows, after taking into account the technology and implementation costs upfront, commenced Year 2 onwards. Bringing It All Together In the words of Daniel Pink274 in his entertaining TED talk: “What science knows business doesn’t do.” Seemingly, becoming evidence-based requires an effort of will and a change in mindset that could be a challenge for many companies to achieve. The success of Sigma’s evidence-based recruiting strategy wasn’t really about data, it was the way data was used. The end goal wasn’t more silos, with a team that owns the data, the process, and its value. The end goal was a data-driven culture where everyone sees the value in data, understands the importance of collecting good data, has access to data, and uses the data to support decision-making. Creating that transformation doesn’t happen easily, you need to find ways to break through the silos, the barriers, the embedded beliefs and assumptions. The idea here is that if you want to get the results you’re looking for then it is important to start at the top. Your vision statements and your purpose help people to believe and understand why data is important within the organization, and those beliefs will help them behave in a manner that delivers on that vision of becoming a data-driven culture. To ensure that the organization had the information 274

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necessary to assess its talent operations, the senior management team and Sigma’s CEO were relentless in re-imagining and building hiring practices that helped leaders at all levels understand how well they were doing when it came to their ability to compete on talent. A large part of this envisioned culture was a commitment to the quality of talent they would hire. To reinforce this value the hiring managers and the recruiting team always began reports and meetings with data on the efficacy of their hiring practices and decisions. The emphasis on data and rigour extended to day-to-day hiring operations and resource utilization measures which was captured in monthly performance dashboards presented to senior leaders. As Jeffery Pfeffer explains in this HBR article275: “As a leader in your organization, you can begin to nurture an evidence-based approach immediately by doing a few simple things that reflect the proper mindset. If you ask for evidence of efficacy every time a change is proposed, people will sit up and take notice. If you take the time to parse the logic behind that evidence, people will become more disciplined in their own thinking.” When people in the organization see senior leaders spending the time and energy to question the underlying assumptions that form the foundation of some proposed policy, practice or intervention, they absorb a new cultural norm. This healthy scepticism coming from the top has the effect of harmonizing people so that when they are on their own and making their own decisions, they can be empowered to make those decisions, because they know they are aligned with the rest of the company. This is about discipline and engaging in a disciplined process. A mindset which helped Sigma link its efforts to exceptional bottom-line results.

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CHAPER TWENTY-ONE GOING GLOBAL: LOCALIZATION OF TALENT ACQUISITION STRATEGY

This chapter highlights salient aspects of the approach adopted at Sigma in adapting its Talent Acquisition Strategy to find and attract talent in a completely new geography. In line with its overseas expansion strategy across emerging global markets, Sigma group had bid and won some large infrastructure projects in West Africa and the UAE region. The organization understood that onboarding the right talent would be the key to solidify and strengthen its presence in these new markets. However, the leadership, in particular, was concerned about some burning questions around the localization efforts in a new geography: • How do we read and assess people from diverse backgrounds? • Does it take different abilities to lead successfully in different countries? • Can we transplant people from one culture to another? • How can Sigma preserve its corporate ethos across markets while still acknowledging local customs? Pankaj Ghemawat, a professor at NYU’s Stern School of Business and IESE Business School in Barcelona, argued in his book Redefining Global Strategy, “that the world isn’t nearly as flat as Thomas Friedman said it was. Cultural differences still abound and national cultures have distinct values, which in turn create different behaviours.” There are many ways of mapping these and the process at Sigma began by leveraging on the insights provided by the Hofstede’s cultural dimensions theory, a framework for cross-cultural communication. This model developed by Dutch researcher Geert Hofstede and IBM’s Personnel Department, provides a baseline through which different cultures can be analyzed and compared across five dimensions: • Power distance reflects the willingness of weaker members of organizations to accept an unequal distribution of power; it is quite high in Latin America, Asia, Africa, and the Arab world and very low in Anglo and Germanic countries.

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Individualism measures the degree to which the person is distinguished from the group. North America and Europe are highly individualistic, while Asia, Africa, and Latin America have much stronger collectivistic values. • Uncertainty Avoidance indicates tolerance for ambiguity; it is quite high in Latin America, many southern and eastern European countries, and Japan and lower for Anglo, Nordic, and Chinese cultures. • Masculinity scores the distribution of roles across genders; Japan and several European countries rank as highly masculine, while Nordic countries are much less so. • Long-Term Orientation shows whether people focus on distant rather than immediate outcomes; it is high in East Asia, moderate in Europe, and low in the Muslim World. The framework allowed Sigma to incorporate scientific evidence in its efforts to localize the talent acquisition strategy in the target markets as detailed below: West Africa – India In comparing West Africa’s (Gabon) cultural dimensions with those of India – refer to exhibit below – the leadership team at Sigma discovered that power distance is a key dimension to consider in creating the desired talent outreach in the region.

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Their culture supported inequalities amongst working people and viewed titles within the workplace as extremely important. Given this focus on status, it was considered essential to highlight Sigma group’s distinctions, such as awards and competitive rankings, and a hierarchical organization structure based on experience and expertise of an individual. A high uncertainty avoidance (UAI) meant that the West African culture is more risk – averse than that in India. Ambiguity is viewed negatively and jobseekers prefer to weigh the facts of an employment opportunity over taking a chance. Jobseekers in the region were also focused on long-term career development and were prone to look at an organization’s overall success to gauge its stability and trajectory. Therefore, the talent outreach strategy had to be content heavy clearly delineating Sigma’s Employment Value Proposition. Thoughtful Execution People in different cultures want and expect different things from their work. Building a team in India is not the same as building a team in West Africa. Figuring out which aspects of the strategy can be standardized and executed at scale and which must be sharply tuned to local needs and then coordinating implementation takes some effort – but it delivers payback in the long run. A thoughtful employment branding proposition at the centre of its Talent Acquisition strategy helped Sigma connect with the best talent the region had to offer and underscored the importance of understanding cultural values and aspirations for organizations looking to excel at finding, attracting and retaining diverse talent within a completely new geography.

EPILOGUE

The Strategy Framework at the heart of Sigma’s reengineering effort in many ways mirrored a Balanced Scorecard276 construct, which helped look at the value creation process from four different perspectives – refer to exhibit below – and provided senior management answers to four basic questions: ‡ How do customers see us? User-Centric ‡ What must we excel at? Operational ‡ How do we look to stakeholders? Financial ‡ Can we continue to improve and create value? Strategic

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The “balanced scorecard” served as an artifact for the group’s effort in defining and communicating priorities to all the affected stakeholders. It provided a common vocabulary to understand both historic and emerging patterns leveraging financial and non-financial measures. According to Kaplan and Norton,277 the scorecard success relies on crafting clear cause-and-effect relationships across the four perspectives, creating a balance among the different measures of performance drivers and results, and communicating strategy and the processes and systems necessary to implement the strategy. Strategy mapping makes explicit the cause-and-effect links by which initiatives and resources – tangible and intangibles – create outcomes at the top of the scorecard. 277

Kaplan R.S. andNorton D.P. “The Balanced Scorecard- Measures that Drive Performance,” HBR, vol. 70, no. 1 (1992).

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Kaplan and Norton, however, point out that simply building scorecard and bucketing initiatives and measures into the discrete balanced scorecard perspectives without understanding the linkages is invalid. The power of strategy mapping lies in systematically and logically linking across the perspectives to create value. The exhibit(s) below illustrate the value creation that was enabled by unlocking these cause-and-effect linkages in the Sigma’s recruitment optimization effort. They show a logical, step-by-step connection between the talent acquisition strategic objectives (shown as ovals on the map) in the form of a cause-and-effect chain. For instance, improving performance in the objectives found in the strategic organization learning capacity (bottom row) enabled Sigma to improve its internal process or operational objectives (the next row up), which in turn enabled the creation of desired outcomes in the Financial and Customer perspectives of its recruiting function.

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Key Success Factor – A Design Thinking Pathway The success of the TA optimization effort, in large measure, hinged around Sigma’s ability to synthesize, identify, and integrate dispersed capabilities within the organization. Competing on Talent to create sustainable competitive advantage presented a need to re-visit its underlying assumptions around talent and consequently re-imagine and re-invent its hiring philosophy. What Sigma needed was an approach to innovative hiring practices and processes, which would integrate the needs of people, the possibilities offered by technology, and the requirements for business success. Design thinking offered just such an approach. It was about leveraging the “power of human-centered design.” Design pioneer Bill Moggridge278 captures the scope of this approach eloquently: “If you think of innovation as being depicted by a Venn diagram, human-centered design is the overlap between technology, business and people…Its most important characteristic is that it creates a bridge between the sciences and the arts. It allows people, teams, and organizations to have a human-centered perspective, and yet bring a scientific approach, towards solving a problem.” When we think of it, the logic of the talent acquisition function is based on building a sustainable relationship capital with end users of its service. 278

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For organizations committed to introducing innovative approaches within their recruiting function this represents a significant point of intelligence. That is successful recruiting ultimately depends on people. Willingness to listen and learn from multiple vantage points, e.g., the candidates, hiring managers, other key stakeholders and the ability to improve the experience of all the constituents at various touch points in the recruiting relationship cycle ultimately drives the success of the function. Relationship building however takes time and focus. It operates on different rhythms and thinking and entails keeping the feelings of the customer in mind at all “touch points” in the relationship journey. Olof Schybergson, the founder of Fjord, a global leader in design and innovation services, views this empathetic stance of design thinking as fundamental to business success. As he told an interviewer, “Going direct to consumers is a big disruptor….There are new opportunities to gather data and insights about consumer behavior, likes, dislikes….Those who have data and an appetite for innovation will prevail.” Change by Design This path to a new-look hiring construct which helped Sigma compete on talent was rife with complexity and ambiguity. How can both strategy and execution be consistently superior? How can they support a culture of “one” yet enable high potentials to thrive as individuals? How can the strategy be global and local at the same time? And how can its processes endure yet be agile and constantly open to revitalization? Too many organizations end up making zero-sum decisions when faced with such challenges. Sigma didn’t look at these issues as trade-offs. Rather, they saw them as inherent tensions that had to be carefully managed and reconciled: A strategic orientation to be balanced by operational excellence; a sense of collective passion and purpose to be balanced by the need of individuals to build their careers; a global perspective to be balanced by local relevance and enduring commitments to leave room for renewal and regeneration. Adopting these perspectives wasn’t easy. But doing so helped recreate a function that could attract, engage, and onboard superior talent, one that could respond quickly to changing business dynamics and empower end-users. Design Thinking provided Sigma with a holistic approach to navigate the shift, which to me is best captured in the schema below adapted from Bill Moggridge’s groundbreaking Design Interactions.279

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Expounding on this model, Moggridge responds: “I think the context of design is changing and expanding. And you can think of that in three concentric circles. Think of the inside circle as the individual. The second circle is the built environment, and the one around that is the overall, holistic environment. Each concentric circle is changing and moving in a design context that is itself expanding.” “In the past, we thought about designing things for the circle at the center. The slightly more expansive context is to think about the health and wellbeing of the individual, rather than the specific things the individual uses. This more comprehensive view requires broader thinking about people.” In Sigma’s context this inner circle was about taking a broader view of the talent construct. It was about uncovering the underlying motivations, the aspirations, and the innate potential of the right talent who would flourish in their organizational context and help execute its vision and strategy. “Similarly, when you think about the built environment, we historically have thought about architecture. But as we move towards an expanding context for design, we find that we’re thinking more about social interactions and innovations.” For Sigma this meant reworking its talent acquisition infrastructure, its form and function, to enable the product – the right hire – and the supply chain – the process – that would deliver it. “And then we think about the larger circle, sustainability is the big issue. In the past, we thought of sustainability as being about materials: choosing

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the best material and designing for disassembly. But now it’s absolutely clear that a sustainable planet is one that’s completely connected. And that, again, is an expansion of context.” This holistic view for Sigma was about basing the logic of their TA function around the end user’s unspoken needs. This included a consideration of the entire organization by developing an outward-looking view, staying on top of cutting-edge trends, creating a strong employer brand, and staying in sync with customer expectations. Emotional resonance of the value proposition offered by talent acquisition was key here. I surmise that thinking more holistically about what comprises an effective design approach can help ensure sustainable success for companies wishing to use design to re-frame their business challenges and achieve their goals. Good Design is Good Business The business impact – profiled in Chapter 19 – to Sigma was significant and was duly corroborated by leading-edge Industry Research presented in the exhibit(s) below:

This impact of recruiting on shareholder value was also addressed in Watson Wyatt’s Human Capital Index.280 The study showed that improving one scale point (on a 1–5 scale) in practices for recruiting and retention would yield 280

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an increase of 7.9 percent in an organization’s market value. Unfortunately, because the budget for Talent Acquisition and mobility is an insignificant percentage of its revenue, it is often ignored. However, as shown in the chart below this budget has a huge leverage on the performance of the organization.

Achieving such tangible business outcomes will require companies to come up with truly game-changing strategies, the ones that will lead them out of the spaces where most companies compete for talent and into the Blue Ocean281 of less (or) un-contested market spaces for talent. As 2017 gets underway the business and organization pressures for finding and hiring top talent could not be greater. Recruitment has not changed in terms of a process – a vacancy needs a suitable hire. However, the landscape, tools, technology, behaviours, expectations, and generations are changing all around us and continue to accelerate how organizations approach their ability to source and acquire talent. 281

https://www.blueoceanstrategy.com/

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I believe there is an even bigger game organizations could play by finding ways to uncover talent, leveraging both the art and science in hiring. The challenge of developing organizations to be more innovative, honest, collaborative, and capable of truly adding value to society in these turbulent times is only starting. In this time of global uncertainty one is reminded of Janus, the Roman god of beginnings and endings, from which the name of the first month of the new year, January, is derived. Janus symbolized the genesis of the world and human life, the start of new historical ages and economic enterprises. He stood for change and transition – from past to future, barbarity to civilization, and youth to adulthood – and is most often depicted with two heads facing opposite directions. His ability to look back is what enabled him to see way forward so clearly. His horizon was exceedingly long-term.282 I believe organizations could do well following this model, particularly when it comes to investing in talent. Forward-looking companies such as Sigma have been seizing this opportunity to move their capabilities forward and create true competitive advantage in talent sourcing and acquisition. They are focusing on finetuning the fundamentals, while devoting increased time and planning to the more strategic areas of talent acquisition, including workforce planning and strategic sourcing. Their standout recruiting results comes from Blue Ocean Recruiting – game-changing strategies – that elevate recruitment from a transactional, short-term focused activity to a strategic, integrated, long-term approach and optimizes their investments in people in a way that makes the competition irrelevant. Reflections on the Growing Complexity of Recruiting Complexity provides a frame within which to interrogate what we see and experience – it gets us to consider, for example, whether situations are resilient or whether dominant factors have got “locked-in” and cannot easily change, or how things might become unstable and collapse or tip. But this should not preclude our taking a detailed view as to what really is happening in any particular circumstance.283 The trends, evolving practices and the multiplicity of technology enabled tools which make up for a complex recruiting landscape underscore a singular theme: A shift from the model of attracting and selecting the best talent to one of attracting, engaging, and selecting the best talent. 282

https://hbr.org/2016/12/hiring-and-managing-in-turbulent-times https://www.amazon.com/Embracing-Complexity-Strategic-PerspectivesTurbulence/dp/0199565260

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Given the backdrop of a changing talent landscape, it has become important for the recruiting function, more than ever, to engage with this shift. Importantly, as the biggest changes we have seen in recruiting have been technology driven, and not fundamentally in how we recruit. Our ability to find great people has only dwindled and the results have hardly improved since the days of I Love Lucy and the Three Stooges Show. This disconnect, to me, is best captured in the business fable of The Chicken and The Pig, which goes something like this: A Pig and a Chicken are walking down the road. The Chicken says: “Hey Pig, I was thinking we should open a restaurant!? Pig replies “Hum, maybe, what should we call it?” The Chicken responds: “How about ‘ham-neggs’?” The Pig thinks for a moment and says; “No thanks, I’d be committed but you’d only be involved!”

The fable is a good allegory for the commitment versus involvement gap that recruitment as a function must navigate from its commonly perceived role as a tactical support function to a genuine business partner. Research shows – and our experience bears out – that despite a universal acknowledgement of hiring good people as a key source of competitive advantage, hiring practices in many organizations tell a different story: haphazard at best and ineffective at worst. It’s one thing to take a poor approach to hiring. But what is really disturbing is that many organizations do not recognize their recruiting situation for what it is; some are even ignorant of their company’s own demographic projections mandating aggressive hiring to replace soon-to-be-retiring managers. Even those who recognize the looming shortage of talent are ill-prepared to fill it. Hiring has always been the sum of stubbornly independent and subjective inputs. A 2006 study, by M/s Boris Groysberg, Nitin Nohria, and Claudio Fernandez-Araoz, on HR practices of over 500 global firms found hiring practices to be disturbingly vague. Respondents relied heavily on subjective personal preferences or on largely unquestioned organizational traditions, often based on false assumptions. Half of the companies relied primarily on the hiring manager’s gut feel, selecting candidate believed to have “what it took” to be successful in any job. Ten years later, the situation for companies is just as bad, if not worse. If hiring top talent has always been a daunting task today’s business landscape makes it tougher than ever. In an era characterized by accelerating change, economic dislocation, and a shrinking pool of job candidates; one wrong hire can quickly throw a company’s best laid business plans off-gear. Hiring people is an investment and studies have shown284 that the ROI on a typical mis-hire can be staggering – a negative 284

http://topgrading.com/_tg-content/downloads/HighCostofMisHires.pdf

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500 percent! This statistic becomes even more startling when we consider that the typical “hiring batting average” of managers is only 50 percent. What medical mistakes can teach us about hiring errors? Hiring fails for many reasons.

In The Checklist Manifesto: How to get Things Right285 Atul Gawande explains [partially adapted by me]: In the 1970s philosophers Samuel Gorovitz and Alasdair MacIntyre published a short essay on the nature of human fallibility. The question they sought to answer was why we fail at what we set out to do in the world. One reason, they observed, is “necessary fallibility” – some things we want to do are simply beyond our capacity. We are not omniscient or all powerful. Even enhanced by technology, our physical and mental powers are limited. Much of the world and universe is – and will remain – outside our understanding and control. There are substantial realms, however, in which control is within our reach. We can build skyscrapers, predict hiring outcomes, save people from heart attacks and stab wounds. In such realms, Gorovitz and MacIntyre point out, we have just two reasons that we may nonetheless fail. The first is ignorance – we may err because science has given us only a partial understanding of the world and how it works. There are skyscrapers we do not yet know how to build, complex roles whose onthe-job performance we cannot predict…The second type of failure the philosophers call ineptitude – because in these instances the knowledge exists, yet we fail to apply it correctly. This is the skyscraper that is built wrong and collapses, the mis-hire whose signs the hiring manager just plain missed, the stab wounds from a weapon the doctors forgot to ask about. For the most part, science has lifted the veil on many facets of the human behaviour and our knowledge to enable informed hiring decisions has improved over the years. This advance means that ineptitude plays a more central role in failure than ever before. Today we know more about effective hiring processes but their adoption in actual practice tells a different story. We know what we should do and we still don’t do it. The problem today is ineptitude. Or, maybe, simply “eptitude” – applying knowledge correctly and consistently. While we know what to do to reduce hiring errors, we don’t always use all the 285

https://www.amazon.com/s/ref=nb_sb_noss?url=search-alias%3Dstripbooks &field-keywords=checklist+manifesto

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available tools, or allow individuals to decide whether or not to follow best practices. You may think I am a broken record with my recurring themes of art, science and evidence-based practices, but I can’t help myself. It is hard to comprehend that smart, educated professionals refuse help or ignore proven hiring interventions in deference to personal preference. The upshot is: What we permit, we promote. Our job is to “Do Good” in the world. “It infuriates me to be wrong when I know I’m right.” – Moliere

To me, the story of recruiting is the story of how we deal with the incompleteness of our knowledge and the fallibility of our skills. As Gawande writes in Why Doctors Fail286: It is uncomfortable looking inside our fallibility. We have a fear of looking. We’re like the doctors who dug up bodies in the 19th century to dissect them, in order to know what was really happening inside. We’re looking inside our systems and how they really work. And like before, what we find is messier than we knew and sometimes messier than we might have wanted to know. There is a reason that Gorovitz and MacIntyre labelled the kind of failures we have “ineptitude.” There’s a sense that there’s some shame or guilt attached to the fact that we don’t get hiring right most of the times. And exposing this reality can make people “more angry” than exposing the reality of how the body works. We’re all human; we hate to fail. And when we do fail, we attempt to block all efforts to provide some transparency to what’s going on. As organizational behaviour expert Chris Argyris has pointed out, “the smartest people become quite stupid when they feel embarrassed or threatened.”287 The impulse to cover our mistakes, however irrational, becomes dangerously strong. Obviously, this impulse comprises the bad people decisions we make. The data, even if we have it, is rarely leveraged. Kathryn Schulz, in her brilliant philosophical meditation Being Wrong: Adventures in the Margin of Error,288 writes: “If we relish being right and regard it as our natural state, you can imagine how we feel about being wrong. For one thing, we tend to view it as rare and bizarre – an inexplicable aberration in the normal order of things. For another, it leaves us feeling idiotic and ashamed….In our collective imagination, error is associated with just not shame and stupidity but 286 https://www.theguardian.com/news/2014/dec/02/-sp-why-doctors-fail-reithlecture-atul-gawande 287 Argyris C., Teaching Smart People How to Learn (Harvard Business School Press, 2004). 288 http://www.amazon.in/Being-Wrong-Adventures-Margin-Error/dp/0061176052

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also with ignorance, indolence, psychopathology, and moral degeneracy. This set of associations was nicely summed up by the Italian cognitive scientist Massimo Piattelli-Palmarini, who noted that we err because of (among other things) “inattention, distraction, lack of interest, poor preparation, genuine stupidity, timidity, braggadocio, emotional imbalance,…ideological, racial, social or chauvinistic prejudices, as well as aggressive or prevaricatory interests.” In this rather despairing view – and it is the common one – our errors are evidence of our gravest social, intellectual, and moral failings.The key question we have to ask ourselves is, how are we going to make it possible that our organizations have the best talent for their business needs? The only way I can see is by making visible the invisible aspects of one’s true persona leveraging the art and science in hiring. And this, as Kathryn Schulz compellingly argues in her book,289“Would require a new way of thinking about wrongness, one that recognizes that fallibility is part and parcel of our brilliance…Far from being a sign of intellectual inferiority, the capacity to err is crucial to human cognition. Far from being a moral flaw, it is inextricable from some of the most humane and honorable qualities: empathy, optimism, imagination, conviction, and courage…Thanks to error, we can revise our understanding of ourselves and amend our ideas about the world.” If we can achieve that, we will be better able to avoid our costliest hiring mistakes, own up to those we make, and reduce the conflict in our hiring ways by dealing more openly and generously with other people’s errors and our own. This can further engender the commitment of organizations to: • Focus on innovative ways to find, engage with, and on-board the right talent. • Stop treating recruitment as a big surprise,290 developing best practices, which in many cases will mean drastically revamping their hiring processes. • Educate their line managers so that they can hire effectively. • Cultivate the need to confront biases and hiring traps that have the power to sabotage great people decisions. Companies and their jobs are often conceptualized as charts and boxes connected by solid and dotted lines. But companies are much more than piles of boxes or generic job descriptions. They are complex, messy, unpredictable, dynamic organisms whose elements interact and evolve 289 290

Ibid. https://hbr.org/2009/05/the-definitive-guide-to-recruiting-in-good-times-and-bad

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dependently and independently of one another and their environment. Pushing on one side of an organization tends to pop something out on the other, and treating symptoms rarely leads to cures. Hiring leaders in the global world order must display the ability to master the changing complexities while orchestrating hiring processes that ignore the essentialist thinking about people’s abilities at the expense of context. Humans aren’t fixed entities. Nor are we simple average abstractions. While absolute certainty in hiring is an elusive concept, the ability to identify, screen, and hire “competence” factoring the circumstances which will realize and optimize that competence is critical. This enables a knowledge repository that can help predict better hiring outcomes. In one of his best known songs, David Bowie lamented, “I don’t want knowledge, I want certainty!”291 In the world of hiring, it would be prudent to forget the certainty and go for the knowledge. Knowledge that leads to self-awareness that bridges the knowing-doing gap. Recruiting as a Force for Good Recruiting and selection excellence is a system-level endeavour. It starts with a “God’s eye view”292 of business, its dynamics and context, and the myriad of moving parts. Crafting expertly bevelled candidate pegs without serious consideration to the characteristics of organization holes into which they are expected to be so snugly fitted is a sure recipe for disaster. If organizations spend the effort thinking through the contextual details of the job, they are going to be rewarded. Companies always lament there is a shortage of talent but the reality as it turns out is there may not be a skills gap but rather a thinking gap on what the talent construct looks like. Ability to complement the numerate insights – the science – with the human touch – the art – can help solidify the reputation of recruiting as a committed strategic partner and a C-suite consigliere. It can help plug the gaping holes in our understanding of that elusive question of how to hire and how to hire well. But this would require the function to stop being a chicken! We in recruiting (and I consider myself part of the fraternity) really do have a higher calling. We are a force for good in business and economy, and when we do our jobs well we really make the world a better place. We give people better jobs, better career, and better organizations to join. As a “force for good” we are expected to attract, engage and hire the best talent for our organizations business needs, understand the subtle nuances of reaching out 291 292

https://www.youtube.com/watch?v=ddn-5uKH6MU http://www.stonewoodgroup.com/perspective/article.go?article_id=116

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to a talent that whispers and find inspirations that are hidden in plain sight. And that means we have to be extremely diligent, innovative, and bold in our hiring practices. Much of what I write here might seem a bit infantilizing to many of you, but after almost two decades of being in the talent space, I realize now more than ever that even more than what you think, how you think matters. And, in the case of hiring we are still using prehistoric thinking to hire people in the modern age. The stakes for understanding this could not be higher today, because we are just not battling for what it means to be recruiters. We are battling for what it means to be a Force for Good. Writing this book has been a labour of love for me. I hope that it will be useful to organizations in keeping the dialogue, between the art and science of hiring, coherent and maximally meaningful. Our ability to string together twin narratives, that of the science and that of the art, is the only path to uncover excellence in hiring. I’ll close by quoting from Dorion Sagan’s book, Cosmic Apprentice,293 which contains great wisdom about the intricate ways in which the two fields hang in a kind of odd balance, watching each other, holding hands: “A good scientific theory shines its light, revealing the world’s fearful symmetry. And its failure is also a success, as it shows us where to look next.”

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REFERENCES

Part III: The Changing Talent Acquisition Landscape • • •

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The Economist, 2006, Survey: Talent. ”The Economist” from http:// www.economist.com. Price Waterhouse Coopers, 2008a, The 11th Annual Global CEO Survey, PWC (New York, September, 2008). Claudio Araoz, Boris Groysberg, and Nitin Nohria, “The definitive guide to Recruiting in Good Times and Bad,” Harvard Business Review (May 2009). Ulrich D. “The Talent Trifecta,” Workforce Management, (September 10, 2006), pp. 32–33. Beechler S. and Woodward I.C., “The Global War for Talent,” Journal of International Management 15, (2009), pp. 273–285, Fox School of Business, Temple University. Fernández-Aráoz C., “The Big Idea – 21st-Century Talent Spotting,” HBR, June 2014. Singh R., “Every Step You Take, Every Move You Make, I’ll Be Watching You – Big Data and Recruiting,” ere.net, Dec 21, 2012. Bouquet C.A., Building Global Mindsets: An attention-based perspective (New York: Palgrave Macmillan, 2005). Groysberg B., Nanda, Nohria N., “The risky business of hiring stars,” HBR, vol. 1–10 (May 1, 2004). Fishman C, “The war for talent,” Fast Company, vol. 16 (July 1998), p. 104.

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Part IV: Competing On Talent– Sigma Group •



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Laurano M. “Talent Acquisition 2013: Adapt Your Strategy or Fail,” http://www.aberdeen.com/research/8559/ra-recruitment-talentacquisition/content.aspx. The phrase “signature experience” was originated by Lynda Gratton and Sumantra Ghosal at the London Business School. For further reading, see Erickson T.J. and Gratton L., “What It Means to Work Here,” Harvard Business Review (March, 2007). http://www.slate.com/blogs/quora/2015/02/11/elon_musk_s_first_ principles_thinking_does_this_learning_style_work.html. Lannon C.P., The Systems Thinker, vol. 7, no. 3 (1996), (Cambridge, MA: Pegasus Communications, Inc.). Senge P.M., Fifth Discipline: The Art and Practice of the Learning Organization (New York, 1990). Cooper D., Dhiri S. and Root J., Winning Operating Models, http://www. bain.com/Images/BAIN_BRIEF_Winning_operating_models.pdf. Taleo Research White Paper – Hidden ROI of Talent Acquisition & Mobility, 2006. “Talent Metrics that Matter,” Human Capital Institute, USA. “Make Your Company a Talent Factory,” https://hbr.org/2007/06/makeyour-company-a-talent-factory/ar/1. Khare S., “Optimizing the organization”, (Tata McGraw Hill Publishing Company Limited, 2006). Ulrich D., “Shared Services: From vogue to value,” Human Resource Planning, vol. 18, no. 3 (1995) pp. 12–24. Brown D. and Wilson S., The Black Book of Outsourcing (Wiley India Edition, 2010). Khare S., Optimizing the Organization: Unleashing the Potential of Practices, Processes and People (Tata McGraw-Hill, 2006). HR – How well do we measure up in the Boardroom? KPMG Thought Leadership. Griffiths D., “The Theory and Practice of Outsourcing” (White Paper, 2001).

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Mertins K. and Jochem R., “Quality Oriented Design of Business Processes.” Bergeron B., Essentials of Shared Services (John Wiley & Sons, Inc., 2003). Hackett Group (n.d.) World-Class HR metrics: World class spend less, yet achieve higher effectiveness. January, 2006, www.hackettgroup.com. Corporate Leadership Council, 2009, technology to support Integrated Talent Management. James Brian Quinn, IBM (A) case, in Quinn J.B., Mintzberg H., and James R.M., The Strategy Process: Concepts, Contexts, Cases (Englewood Cliffs, N.J.: Prentice-Hall, forthcoming). Miller D. and Friesen P.H., “Archetypes of Strategy Formulation,” Management Science, May 1978, p. 921.

Part V: Road-Map for Strategy Delivery • • • • • • •



Brockbank W., Developing a Human Resource Strategy, University of Michigan. Bass J. and Schein E.H, Organization Culture and Leadership (3rd edition). Richmond V.P., McCroskey J.C., and McCroskey L.L., Organization Communication for Survival: Making Work, Work. (2005). McKinsey Quarterly, “McKinsey Quarterly: Eric Schmidt on business culture, technology, and social issues”, May 2011. Eckes G., Six Sigma for Everyone. https://www.isixsigma.com/toolstemplates/fmea/quick-guide-failure-mode-and-effects-analysis/. Laurano M., “Should Your Organization Consider a Recruitment Centre of Excellence?” (Bersin by Deloitte, August 19, 2009). Brockbank W. and Ulrich D., “Competencies for the new HR” (University of Michigan Business School, Global Alliance, Society for Human Resource Management, 2003). Cicek I. and Ozer B., “The effect of outsourcing human resource on Organizational Performance: the role of Organization Culture,” International Journal of Business and Management Studies, vol. 3, no. 2 (2011).

Part VI: Value Creation through Optimization •

http://www.bersin.com/News/Details.aspx?id=15397. and space The New Talent Acquisition Framework.

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“Make Your Company a Talent Factory,” https://hbr.org/2007/06/makeyour-company-a-talent-factory/ar/1. Dauphinais GW. and Price C., “Straight from the CEO” (Price Water House Coopers: Simon and Schuster Inc., 1998). Adapted from ‘A Question of Balance,’ Managing the Professional Services Firm, Maister D. (Simon & Schuster, 1997) pp. 3–9. Adapted from “On the Importance of Scheduling,” Managing the Professional Services Firm, Maister D. (Simon & Schuster, 1997) pp. 181–184. Adapted from “Successful Talent Strategies,” Sears D. (Amacom Publication), pp. 77–79. “High Impact Talent Acquisition – Key Findings & Maturity Model,” Bersin by Deloitte, September, 2014. Recruiting Roundtable, “The State of the Recruiting Function,” Corporate Executive Board (January 2006). Journal of Corporate Recruiting Leadership | crjournal.com | August 2007. Kaplan R.S. and Norton D.P., “The Balanced Scorecard, Translating Strategy into Action,” (Boston: Harvard Business School Press, 1996). Sears D., Successful Talent Strategies (Amacom, 2003), p. 214. “Data, Metrics, Analytics: The Hierarchy of Knowledge,” http://blog. smashfly.com/2014/11/20/data-metrics-analytics-the-hierarchy-ofknowledge/. Hammer M., “Reengineering Work; Don’t Automate, Obliterate,” HBR, July/August, 1990, pp. 104–112. Hammer M. and Champy J., “Reengineering the Corporation: A Manifesto for Business Revolution” (London: Harper Collins, 1993). Young M.B., “Strategic Workforce Planning,” The Conference Board, 2006. Cotton A., “Seven Steps of Effective Workforce Planning,” Human Capital Management Series, 2007. Becker B.E., Huselid M.A., and Ulrich D., The HR Scorecard: Linking People, Strategy, and Performance (HBS Press, 2001), pp. 94–95. Corporate Recruiting Reports, http://www.staffing.org/documents/07_ CostandTimeReportLookInside.pdf. Hofstede’s Cultural Dimensions Theory: http://geert-hofstede.com/ applications.html. Hofstede, G., Culture’s consequences: International Differences in Work – Related Values. Beverly (Hills, CA: Sage Publications, 1980). Moroko L., and Uncles M.D., “Characteristics of Successful Employer Brands,” Journal of Brand Management, vol. 16, no, 3, pp. 160–175.

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Ma R., and Allen D.G., “Recruiting across cultures: A Value based model of recruitment,” Human Resource Management Review (2009), doi: 10.1016/j.hrmr.2009.03.001. Hofstede G. , Cultures and organizations: Software of the mind (London: McGraw-Hill, 1991). Ployhart R.E., “Staffing in the 21st Century: New Challenges and Strategic Opportunities,” Journal of Management, vol. 32, no. 6 (2006), pp. 868–897.

Epilogue • •

Kaplan R.S. and Norton D.P., The Balanced Scorecard, Translating Strategy into Action (Boston: Harvard Business School Press, 1996). Ready D.A., Hill L.A., and Thomas R.J., Building a Game-Changing Talent Strategy; https://hbr.org/2014/01/building-a-game-changingtalent-strategy.

GLOSSARY

A Analytics: The method of logical analysis – a careful study of something to learn about its parts, what they do, and how they relate to each other. It provides an explanation of the nature and meaning of something. Analytics are intangible, future-focused in an attempt to predict possible outcomes, and designed to provide insights to enable informed decision making. API: An Application Programming Interface (API) is a set of routines, protocols, and tools for building software applications. It enables one application to talk to another. In the context of recruitments it provides a seamless integration of the application tracking systems with external applications, candidate audiences, and vendors. ATS: Application Tracking System (ATS) is a software application used to manage the talent acquisition process. Originally designed as resume collection systems, over time, these systems evolved into workflow management systems enabling recruiters to put job postings online, collect and filter resumes, and assess them for fit. Modern applicant-tracking systems are cloud enabled and more resemble an “integration platform” that not only track and manage resumes but also store valuable data about the entire talent acquisition process. ASP: An Application Service Provider (ASP) is a business providing computer-based services to customers over a remote network. In the ASP model, the customer does not specifically “own” the software but “rents” it – and the software company runs it for them. The modernized version of ASP is also called “Software as a Service” (SaaS). Assessments: An “assessment” is a test or form of evaluation that measures skills, competencies, knowledge, and behavioural traits. Many types of assessments tools are used in the recruitment process that can be leveraged to determine job fit, uncover personality attributes, and cultural fit. Some leading providers of assessments tools and services include SHL, DDI, CPP, Korn Ferry, and Hogan Assessments among others.

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B Balanced Scorecard: The balanced scorecard (BSC) is a strategy performance management tool which leverages both financial and nonfinancial measures in assessing organization and /or functional performance. It breaks business strategy into four levels of goals: financial, customer, process, and people. By combining perspectives, the balanced scorecard helps unlock the real value underlying the many interrelationships across these four levels. Big Data: The term “Big Data” refers to large and complex data sets that cannot be processed using traditional data processing applications. The term often refers to the use of predictive analytics or other advanced methods to extract value from data and is characterised by the four Vs: Volume, Velocity, Veracity, and Variety. Blue Ocean Strategy: A perspective on strategy formulation and execution created by INSEAD professors W. Chan Kim and Renee Mauborgne. The logic behind blue ocean strategy parts with traditional models focused on competing in existing market space to one based on systematically creating “blue oceans” of uncontested market space ripe for growth. This strategy outlook aligns the whole system of a company’s activities in pursuit of value and cost differentiation. C Candidate: A candidate is anyone who engages with an employer brand while exploring the possibility of a new job, now or in the future, who hasn’t applied, or is no longer being considered for a position. Candidate Experience: The collective result of all the interactions a candidate has with an employer brand during the recruitment marketing and the hiring process. Candidate Pools: Also referred to as a “Talent Pool”, they are generated from the process of engaging and grouping candidates by interest levels, background, skills, and experiences. Candidate Audiences: Segmented pool of candidates targeted by an organization through appropriate employer branding and content strategies with the ultimate objective of attracting, engaging and on-boarding them. The accent is on cultivating a long-term relationship capital with the right candidates. Cascading Goals: A process of adopting goals at different levels within a company to ensure alignment between the organization’s objectives, and employees’ activities and goals.

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Causal Model: An abstract model that describes the causal mechanisms of a system. The model must express more than correlation because correlation does not imply causation. Causal Diagram: A graphical tool that enables the visualization of causal relationships between variables in a causal model. Causal Loop Diagram: A “causal loop diagram” (CLD) is a causal diagram that aids in visualizing how different variables in a system are interrelated. The diagram consists of a set of nodes and edges. Nodes represent the variables and edges are the links that that represent a connection or relation between the two variables. It is a method of analysis used to develop an understanding of complex systems. Centre of Excellence: A “Centre of Excellence” (COE) refers to a shared facility, corporate structure or a team that provides leadership, evangelization, best practices, research, support, and/or training for a focus area. It is also variously called as “Competency Centre” or “Capability Centre.” In the recruiting context, organizations create a COE based on their individual hiring needs. Key drivers could include: standardization of recruitment processes and metrics, workforce planning, employer branding, to name a few. Change Management: The term refers to a broad discipline of programs, processes, and tools that drive organizational change. It is an approach to transitioning individuals, teams, and organizations to a desired future state. Cloud Computing: The practice of using a network of remote servers hosted on the internet to store, manage, and process data rather than a local server or a personal computer. It relies on sharing of resources to achieve coherence and economies of scale. Cloud Recruiting: The concept of outsourcing recruiting using a data driven, highly predictive process utilizing the collective intelligence of successful hires, the expanded candidate reach of crowdsourcing through known and unknown social connections allowing recruiting capacity to scale on-demand in a highly capital and resource efficient manner leveraging software as a service (SaaS) in a cloud computing model. Crowdsourcing: “Crowdsourcing” is a practice of obtaining needed services, ideas, or content by soliciting contributions from a large group people, and especially from an online community or the internet, rather than from traditional employees or suppliers. Competency: A “competency” is a measurable characteristic of a person that is related to success at work. It may be a behavioural skill, a technical skill, an attribute (such as intelligence), or an attitude (such as optimism). Content Strategy: Creating and curating compelling content and messaging to attract and engage with prospective talent specific to the business context

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of an organization. Tools could include infographics, recruiting micro-sites, blogs, videos, career sites, among others. Customer Relationship Management: It is a system for managing an organization’s interactions with present and future customers. It often involves using technology to organize, automate and synchronize sales, marketing, customer service and support. Modern Applicant Tracking Systems often resemble a Customer Relationship Management (CRM) system, in that they help focus on existing and future candidate relationships and configure the hiring process to be maximally efficient. D Data Science: In general terms, data science is the extraction of knowledge from data. It draws upon techniques and theories from multiple disciplines such as mathematics, statistics, and information technology. Data Science techniques affect research in many domains, including healthcare, social sciences and now Human Resources. Datafication: It is a modern technological trend turning an existing business into a “data business” and transforming this information into new forms of value. In HR it refers to our increasing ability to use Talent Analytics to understand more about people, HR practices, processes, and external demographics. E Employer Branding: Activities that help to uncover, articulate and define a company’s image, culture, key differentiators, reputation, and products and services. It is the image of an organization as a “great place to work” in the mind of current employees and key stakeholders in the external market. The process of employer branding is concerned with talent attraction, engagement, and retention strategies deployed to enhance an organization’s employer brand. Engagement Strategy: An organization’s strategy for engaging with its critical talent with the end objective of aligning the individual and the business goals. F Farming: A Talent pipelining concept which seeks to proactively identify and establish relationships with top talent in the marketplace well in advance of an actual hiring need. Flight Risk: Flight risk refers to the degree to which a top performing employee appears ready to leave current employment, presumably for a better opportunity elsewhere.

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Glossary

G Gamification: The use of game thinking and game mechanics in non-game contexts to engage users in problem solving. Applied to talent acquisition, it involves the use of games, simulations and other multi-media rich applications in hiring, selection, and assessment processes. Generation–Y: Also known as “Millennials”, they are individuals who were born between 1981 and 2000, and are culturally thought to be confident, impatient, socially conscious, and technology-savvy. Groupthink: “Groupthink” is a psychological phenomenon that occurs within a group of people, in which the desire for harmony or conformity in the group results in an irrational or dysfunctional decision-making outcomes. H High Potential or HiPo: A “high potential” employee is an individual who has been identified as having the potential, ability, and the aspiration for successive leadership positions within the company. Often, these employees are identified as part of a succession plan and are referred to as “Hi-Pos.” Hiring & On-boarding: A strategic process of integrating the new hires into a company’s workplace environment through forms management, tasks management, and socialization in the company culture. Human Capital: The total knowledge, skills, and capabilities of an organization’s workforce. I Internal Mobility: “Internal Mobility” or talent mobility is a dynamic internal process for moving talent across roles – leadership, operational, and professional levels. To achieve internal mobility, companies must adopt the principles of succession management at all ranks; provide transparent discussion of skills and development, as well as organizational needs; and focus on development across critical talent pools, based on business needs. Interoperability: The ability of making systems and organizations work together. J Job Fit: “Job Fit” refers to the assessment of current knowledge skills, competencies, and other key attributes of an individual against the requirements of a specific role. Just-in-Time: A lean concept, “Just-in-Time” (JIT) is founded on the principle of continuous reduction of all inventory, while satisfying changing market demand with shorter lead times and production. Applying this

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concept to talent identification and acquisition, JIT recruiting is a pull-based strategy of providing hiring managers with the right candidates at the right place with the right skills at the right place. K Key Performance Indicator: A “key performance indicator” (KPI) is a quantifiable measure of success that reflects the critical success factors of a department, project or business unit. Kaizen: A Japanese term for “continuous improvement.” When applied to the workplace, kaizen refers to activities that continually improve all functions. By improving standardized activities and processes, kaizen aims to eliminate waste resulting in overall improvement in productivity. L Leadership Pipeline: “Leadership pipeline” refers to an organization’s need to have a ready pool of talent across levels to support its growth and expansion needs. Lean: A process improvement methodology that focuses on maximizing process velocity by reducing waste or non- value-added activities. Lean operation principles are derived from the lean manufacturing practices but as lean deals with production system from a pure process point of view, and not a hardware point of view, its principles can be readily applied to improve the efficiency and velocity of all business processes including recruitment. M Metric: A “metric” is a standard of measure based on historical data points. They are tangible in nature and derived by trending and analyzing the data captured on an ongoing basis. Commonly used metrics in recruitment include: cost per hire, time to fill, source of hire, candidate drop-off rate, among others. Muda: “Muda” is a Japanese word meaning waste. It refers to any activity in a process that does not add value from the customer perspective. There are seven categories of waste identified in muda which can be targeted for elimination and improve the value proposition to the customer. N Nine-Box Grid: A “nine-box grid” is a matrix tool used to evaluate and plot a company’s talent pool based on two factors: performance and potential. They are actively used during a talent review process and aid in the discussion of employee strengths and development needs to shoulder key leadership roles.

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Glossary

O On-boarding: “On-boarding” also known as organizational socialization refers to the process of hiring, orienting, and integrating new employees into their roles and into the organization’s culture. Optimization: A process to ensure effective and efficient deployment of existing resources for capability maximization. It is the result of interplay between utilization, efficiency, and effectiveness. Organization Culture: “Organization Culture” is the most central aspect of organizational capability. It represents the collective mind-set of the company – shared ways of thinking or shared cognitive patterns. It defines the way people behave, and it also determines what information people will accept, interpret accurately, and adopt as useful knowledge. Organization Maturity: It is the level of organization’s readiness and experience in relation to people, processes, technologies, and consistent measurement practices. Outsourcing: “Outsourcing” is contracting out a business function or process to a third-party organization. P Parsing: “Parsing” refers to the process of electronically identifying specific phrases or words within a document, and assigning meaning to them. For instance, in talent acquisition, the technology allows the recruiters to electronically gather, store, and organize information contained in the resumes. The information so formatted is easily searchable using keywords and phrases. However, being a software searching process it’s often error prone. Pre-hire Assessment: “Pre-hire Assessments” are scientific tools used to evaluate whether a person has the right skills to perform a job in terms of knowledge, skills, behaviour, and cultural fit. Pugh Matrix: A decision-matrix method, the Pugh method is a quantitative technique used to rank the multi-dimensional options of an option set. A lean six-sigma tool, its application as a scoring matrix can be variously applied in recruitments to rank vendor options, hiring candidate options or any other set of multidimensional entities. Q Quality Functional Deployment: Quality function deployment (QFD) is a structured methodology and mathematical lean six-sigma tool used to identify and quantify customer needs (VOC) into key quantitative parameters. It helps to prioritize actions to improve a process or product in alignment with customer expectations.

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R Recruiting: The tactical process of attracting, selecting, and on-boarding candidates; either permanent or temporary. RPO: “Recruitment Process Outsourcing” (RPO) is a form of business process outsourcing (BPO) where an employer transfers all or part of its recruitment activities to an external service provider. A true RPO solutions provider manages the entire recruiting process from job profiling through the on-boarding of the new hire, including the people, process, and technology intervention. S SaaS Delivery Model: A delivery model where the vendor hosts and operates the technology platform at its facility. It is sometimes referred to as “ondemand software” and is typically assessed by users using a thin client via a web browser. Cloud-based recruiting and application tracking software are being increasingly leveraged by organizations using a SaaS delivery model. Screening & Assessment: Tools and technology that enable organizations to evaluate if a candidate has the right skills to perform a job. Semantic Search: A data searching technique that seeks to improve search accuracy by understanding searcher intent and contextual meaning of terms as they appear in the searchable database. When sourcing candidates, semantic search can be achieved at the conceptual level when a search for a specific term (e.g., java) also yields matches on related terms (e.g., J2EE, EJB, servlets) – words that are related conceptually. Shared Services Model: A business model which enables resources to be leveraged across the entire organization. A “shared-services organization” acts as an internal consulting group that provides a menu of well-defined services to line managers and line training groups. This necessitates shared accountability of results by the unit from where the work is migrated to the provider. The provider unit ensures the agreed results are delivered based on defined measures (KPI’s, cost, quality, etc.). SIPOC: A SIPOC (Suppliers, Inputs, Process, Output, Customers) is a high level process map that identifies the potential gaps (deficiencies) between what a process expects from its suppliers and what customers expect from the process, thus defining the scope of the process improvement activities. Six Sigma: “Six Sigma” is a disciplined, data-driven approach and methodology for eliminating defects and reducing process variance. The fundamental objective of the Six Sigma methodology is the implementation of a measurement-based strategy that focuses on process improvement and variation reduction through the application of Six Sigma improvement projects.

262

Glossary

Social Media: “Social Media” is an umbrella term for using the computermediated communication channels as new forms of media. It refers to tools such as blogs, micro-blogs, wikis, podcasting, and video/media libraries. Social Networking: Social networking represents the use of personto-person networking approaches that facilitate collaboration, learning, knowledge sharing, and organization communication. It leverages the use of web tools for individuals to post profile information, share comments, collaborate, and join groups and communities. Social Recruiting: “Social Recruiting” is recruiting candidates by using social platforms as talent databases or for advertising. Some popular social media channels used for recruiting include LinkedIn, Facebook, Twitter, XING, Google+. Supply Chain: A “supply chain” is a system of organizations, people, activities, information, and resources involved in moving a product or service from supplier to customer. Conventional supply chain activities transform natural resources, raw materials, and components to a finished product that is delivered to a customer. Staffing Supply Chain: Similar to a supply chain, a “Staffing Supply Chain” transforms relationships and data (ad responses, resumes, social networking profiles, etc.) into candidates that are delivered to hiring managers. Staffing Plan: A staffing plan identifies the necessary human resources for delivering on the organization’s goals, projects, and commitments. Systems-Thinking: “Systems Thinking” is the process of understanding how things, regarded as systems, influence one another within a whole. It is an approach to problem solving that is based on the belief that the component parts of a system can best be understood in the context of relationships with each other and with other systems, rather than in isolation. T Talent: According to McKinsey, talent is the “sum of a person’s abilities, his or her intrinsic gifts, skills, knowledge, experience, intelligence, judgment, attitude, character and drive. It also included his or her ability to learn and grow.” Talent Acquisition: “Talent Acquisition” is a strategic approach to identifying, attracting, and on-boarding top talent. Talent Analytics: Talent Analytics refers to the analysis of talent related data for business decision making. These data points could include: demographic data, performance data, job history, compensation, mobility, assessment, training, and more. This data can be correlated and matched to

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many different types of business data to help companies understand profiles and behaviours which create high performance. V Value Stream Mapping: “Value Stream Mapping” is a lean management method for analyzing. A lean process tool, value stream mapping is a fundamental tool to identify waste, reduce process cycle times, and implement process improvement. W Web 2.0: “Web 2.0” refers to a second generation of web-based communities and hosted services (such as social networking sites, wikis, blogs, podcasts, RSS feeds, application programming interfaces), that aim to facilitate creativity, collaboration and sharing between users. Workforce-Planning: “Workforce Planning” is a process by which an organization anticipates and meets its business talent needs. Workforce planning enables evidence based workforce development strategies.

READING LIST

This is a list of books I read while writing this book that I found inspiring and instructive. – The Genius in All of Us: New Insights into genetics, Talent, and IQ by David Shenk. – Predictably Irrational: The Hidden Forces that Shape Our Decisions by Dan Ariely. – Thinking Fast and Slow by Daniel Kahneman. – This is Service Design Thinking: Basics, Tools, Cases by Marc Stickdorn and Jakob Schneider. – It’s Not the How or the What but the Who by Claudio Fernandez-Araoz. – Great People Decisions by Claudio Fernandez-Araoz. – Proust Was a Neuroscientist by Jonah Lehrer. – Talent on Demand: Managing Talent in the Age of Uncertainty by Peter Cappeli. – Reengineering the Corporation: A Manifesto for Business Revolution by James Champy and Michael Hammer. – The Talent Code: Greatness isn’t born, It’s grown by Daniel Coyle. – Why We Work by Barry Schwartz. – The Shift by Lynda Gratton. – The Alliance: Managing Talent in the Networked Age by Reid Hoffman. – How to Find Fulfilling Work by Roman Krznaric. – The Rare Find by George Anders. – Broken Windows, Broken Business by Michael Levin. – Talent is Overrated by Geoff Colvin. – Be Our Guest-Perfecting the Art of Customer Service by Theodore Kinni. – Hard Facts, Dangerous Half-Truths and Total Nonsense by Jeffrey Pfeffer and Robert I. Sutton. – Leading Teams by J. Richard Hackman. – Work Rules by Laszlo Bock. – The End of Average by Todd Rose. – The Heart of Change by John P. Kotter. – The Complexity of Greatness by Scott Barry Kaufman. – Being Mortal by Atul Gawande. – The Checklist Manifesto by Atul Gawande.

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– Human Equation: Building Profits by Putting People First by Jeffrey Pfeffer. – Humans Are Underrated by Geoff Colvin. – Blink: The Power of Thinking Without Thinking by Malcolm Gladwell. – Drive by Daniel H. Pink. – The Black Swan: The Impact of the Highly Improbable by Nassim Nicholas Taleb. – Change by Design by Tim Brown. – Originals: How Non-Conformists Move the World by Adam Grant. – The Three Boxes of Life: And How to Get Out of Them by Richard N. Bolles. – Are You Smart Enough to Work at Google by William Poundstone.

ABOUT THE AUTHOR

An alumnus of BITS Pilani with a Masters in Management from the Asian Institute of Management, Manila (established in Partnership with the Harvard Business School and the Ford Foundation), Pradeep’s leadership experience includes managing P&L, talent acquisition, and Business HR remits in both large corporate and professional services environments including start-up ecosystems. His domain expertise spans the technology, Telecom, Engineering/Infrastructure, and Financial Services industry sectors. Currently the Director, Talent Management, with an IT firm, his earlier experience spans executive roles at Srei-BNP Paribas as Vice President & Head HR and Group Head Talent Acquisition at Ramky Group. He brings over 20 years of leadership experience in the talent space with an emphasis of building high-performing teams to drive excellence in talent management. He is a keen follower of new and emergent technologies around recruitment and talent management and likes to contribute on topical issues in talent acquisition including integrating with talent management and authors a blog around process, practices and trends that are continuing to impact the recruiting industry. He has been published online and in print journals by Silicon India, Emerald Publishing, LinkedIn.Com, mosaicHUB.com.

WHAT PEOPLE HAVE SAID ABOUT PRADEEP SAHAY

We were planning to automate talent acquisition solution. I enjoyed Pradeep’s ability to see through end-to-end resource hiring cycle and identify process bottlenecks. – Sunil Malhotra, Vice President, NIIT Technologies. I liked working with Pradeep due to his professional focus and ability to get results. However, I came to appreciate his leadership style – strategic thinking, empathetic yet firm decision making, strong ethics, and rigorous follow through when we worked closely on transforming talent management strategies and practices at four group companies. – Manoj Khare, Partner National Care Organization. Pradeep has this unique ability to focus on the overall candidate experience at various touch points in the recruiting process. The same reinforced the employer attractiveness and value proposition enabling an informed decision. A talent acquisition strategist par excellence, I would rate him high for his relationship capital. – Prem Swarup, Vice President & Global Practice Head – Business Intelligence, Wipro Technologies, USA. Working and interacting with Pradeep is a delight – any engagement with him is intellectually stimulating. Pradeep can be credited with nurturing and growing some of the strongest client relationships Datamatics developed in the IT space in Delhi. A slow charming smile hides a sharp intellect that is always looking to bring in innovative changes. He has an unending thirst for knowledge and learning, an eye for detail, and very good networking skillstraits that qualify an excellent search professional. – Sumitra Char, Senior Vice President, Datamatics Ltd. Pradeep is a great business partner, in meeting talent acquisition requirements. Pradeep distinguishes himself by being pro-active, upfront, dependable, and a go-getter. He has immense commitment and respect for his partners. His social network and understanding of the talent pool greatly supplement his personal attributes. Despite being an external partner, Pradeep is very supportive of innovative and cost beneficial delivery models which make the relationship more value-adding. – Azfar Hasib, Director HR, Cavium Networks, U.S.A. Buying Professional Services is rarely a comfortable experience. Unfortunately there seem to be very few professionals who can “hit the ground running” and provide the kind of professional support you need.

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What People Have said about Pradeep Sahay

When we associated with Pradeep as our Professional Service provider, we did not buy into a service; we bought ourselves a relationship – a topdrawer Professional Services provider who had the right skills and urgency in recruiting the right person for our organization. The key is – the right kind of attitude and desire to help meet the unique manpower challenges of a rapidly growing organization. As a client he has earned my trust and confidence. – Amit Gupta, Director & Mentor, Fabence.com, ex-Managing Director, Royal Bank of Scotland, IDC. Pradeep displayed a professional mind and he could focus on the critical and explain it to the client with empathy. This helps in making informed and effective business decisions. – Emmanuel David, Director, Tata Sons. Pradeep attended Lean Six Sigma workshop conducted by me in 2012. I appreciate his ability to relate softer intangible human resource challenges with quantitative decision making approaches. He was able to provide valuable inputs during the training on how data-driven decision making can be instrumental for HR professionals. It helped other participants to see that HR equally needs efficient processes, not just words. I truly appreciate these inputs and thank him for attending the workshop. – Dr Shantanu Kumar, Director, Benchmark Six Sigma.

ACKNOWLEDGEMENTS

I take this opportunity to acknowledge those who have made a visible difference to my chosen vocation and have lent to me their strong shoulders on which I stand. People who are true practitioners of the “art” and “science” of recruiting and have helped elevate the professional standards of our Industry. People whose nuggets of wisdom, insights, and inspirational words, pointed the way ahead to script this body of work. To that extent I have stolen from others but as a student of my professional craft I also understand that nothing comes from nowhere. It calls to mind noted author Oliver Jeffers’ subtle but resounding message: In art – as in science, as in all of human culture – the ideas we call our own are but the combinatorial product of countless borrowings from the intellectual “property” of others. All professional work builds on what came before. Nothing is completely original. It’s right there in the Bible: “There is nothing new under the sun.” Ecclesiastes 1:9

When it comes to those who have most profoundly influenced my recruiting knowledge and expertise there is none I esteem more, or feel a deeper sense of solidarity with, than Adarsh Matta. An Industry thought leader of stature, over the years he has been my strongest supporter and critic in equal measure and has never ceased to illuminate the trail I now follow by his perspicacity and sense of pragmatism. However, his greatest impact cannot ultimately be measured because in writing this book, I have so liberally, and with permission, borrowed from him.

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Acknowledgements

Throughout the course of my professional career, I have been fortunate to have benefited from sage heroes of our industry like Subhash Bhatia, (late) Deepak Bhargava, and to count among my friends passionate votaries like Azfar Hasib, Rajinder Bisht, Sumitra Char, Captain Kaushik, Manoj Khare, and Rajiv Sharma whose boundless energy and constant contributions to our profession fans the embers of my creativity. My learning, unlearning, and re-learning curve in writing this book has also benefited by following the writings and works of some brilliant strategy and recruitment practitioners such as Prof. Jacinto C. Gavino, Dave Mendoza, Shally Steckerl, Raghav Singh, Achyut Menon, and Glen Cathey to name a select few. If this fraternity from my professional world has been contributory in shaping the roadmap of my career journey, the gas for the road was provided by my wife Shalini. Since the start of my recruiting career with a traditional staffing firm, her presence around me has been elemental. A constant companion through the highs and lows of my professional journey, navigating the rough and tumble of a recruiter’s life without her companionship would have been a daunting task. She continues to provide the revitalizing salve that protects me from permanent damage, and selflessly administers the guidance that steers me back to sanity after I lose my way including keeping me on track with projects like writing this book. My grateful thanks are especially due to John Stuart, of Stuart Editorial, whose efforts culminated in the offer from Cambridge Scholars to publish this book and showing much faith in it, the commissioning editor, Victoria Carruthers, for her patience and deeply collaborative spirit and to Indrani Ganguly, the copy editor, for her technical prowess and remarkable eye for detail. Without you all, what I penned would have remained just an abstraction. To all the people I have stolen from and to everyone else who has taken a moment to share with me an idea, suggestion, question, critical comment, challenge, or an opposing point of view, this book is dedicated to your success.

INDEX

Abs, Hermann 196 Aiden, Erez 79 Altman, Joey 6 Anand, Bharat 9 Anders, George 37, 51, 69 Angelou, Maya 39 Animal lover 22 Apple 5 Applicant Tracking System (ATS) 166, 223 Aptitude tester 21 Araoz, Claudio 57 Arendt, Hannah 32 Argyris, Chris 245 Ariely, Dan 16, 73 Armitage, David 96 Art critic 21–22 Assessment science 75–76 ATS. See Applicant Tracking System (ATS) Aykroyd, Dan 50 Balance sheet talent 66 Balanced scorecard (BSC) 234 Becker, Carl 100 Beethoven 45 Benchmark data 118 Berry, Lisa 65–66 Bersin by Deloitte 180 Best practices metrics & measurements 209–220 recruiting department structure 185–192 recruiting process components 193–203 technology 220–223 workforce planning process 203–209 Best practices template 219 Best-in-class infrastructure player 103 Big Five 20

Bock, Laszlo 53 Book of Matthew 40 Borrowed talent 66 Bossidy, Larry 178 Bowie, David 247 Bowles, Dick 61 Brand thinking 110 Brown, John Seely 97 Brown, Tim 107 Brynjofsson, Erik 223 Brynjolfsson, Eric 87 BSC. See Balanced scorecard (BSC) Campbell, Joseph 159 Candidate experience 93–94 Capability optimization xiv–xvi Cappelli, Peter 69, 204, 205 Carlisle, Todd 70 Carr, David 100 Causal loop diagram (CLD) 140, 141–144 CEB 77 Centre of Excellence (COE) 156, 165, 167, 169, 170 Champy 119 Chan, Claudia 59 Chandler, Alfred D. Jr. 100 Chatterbox 22–23 CLD. See Causal loop diagram (CLD) Closed loop analytics 76–77 Collins, Jim 70 Colvin, Geoff 87, 88 Combustion statements 128 Competency areas 93 Competing on Talent 7 Continuity-change continuum xv Coventry University 122 Coyle, Daniel 42 CPI 20 Creativity 107

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Index

Critical thinking 13 Critical to quality (CTQ) 122 Customer Relationship Management (CRM) 185 Customer-focused advisors 167 Customers 114 Cutler, Mary Schuler 37 Data-driven recruitment 80–83 Davenport, Tom 81 DDI 77 de Chateaubriand, François-René 4 Delphi 93 Delphi method 205 Demodocus 43 Design element chart 125 Design problem 106 Design thinking principles 98, 106, xvi Design thinking, power of 107–109 Dierdorff, Erich C. 15 Digitalization, recruitment 83 Dipboye, Robert 25 Direct sourcing and networking 92–93 Doolittle, Eliza 50 Drucker, Peter 164 Duckworth, Angela 54 Dunnette, Marvin D. 217 Edison, Thomas 45 Einstein, Albert 33 Elliot, Jay 75 Ellis, Charles 5 Empathy 107 Employee 114 Employee Value Proposition (EVP) 111 Employer brand 109–115 Employer–employee interface 72 Eptitude 244 Ericsson, K. Anders 46 Evans, David 37, 72 Evidence-based hiring practices 28–30 Excellence at work fundamental motivating forces 3 hire for 8 Excellence, values of 12

Failure mode and risk analysis approach (FMEA) 175 Fairbank, Richard 27 Fernández-Aráoz, Claudio 11, 14, 26, 67, 243 Finding the right people 9 Force for good 248 Ford 93 Ford, Henry 45 Fortune teller 19 Fourth culture 34 Freelance talent 66 Functionality 181 Functionality dimension 146 G Gallardo-Gallardo 40 Gallup 3, 110 Galton, Sir Francis 68 Gardner, Howard 43 Gates, Bill 86 Gawande, Atul 244, 245 GE’s 93 Geertz, Clifford 37 Genentech 5 Ghemawat, Pankaj 231 Gibson, William 60 Gladwell, Malcolm 26, 35, 52, 111 Gleiser, Marcelo 86 Global Selection Forecast 214 Goethe 50 Google 72 Gopnik, Adam 221 Gorovitz 245 Gratton, Lynda 60, 111 Great people decisions 10–11 *ULI¿WKV1HLO Groysberg, Boris 57, 243 Guldi, Jo 96 Hackman, J. Richard 156 Hagel, John III 97 Hammer 119 Handler, Charles 76, 78 Hannay, Timo 47

Index Harvard 16 Hausknecht, John 80 Hawking, Stephen 86 Hayashi, Alden 35 Hebb, Donald 47 Heskett, James L. 112 Higgins 51 High-skill/high-pay 88 Hippocrates 83 Hiring analytics to 77–78 checklist 194 competitions 77–78 discipline of 17 evidence-based practices 28 intelligent decisions 27 judgment-based decisions 89 life-cycle 34, 36 managers 20, 26–27 practices 14 process algorithm 51 science to 34  VFLHQWL¿FSURFHVVIRU simulations 77–78 uniform process 37 Hirsh, Wendy 71 Hitt, Lorin 223 Hoad 40 Hofstede, Geert 231 Holmes, Sherlock 80 Homer 43 Horowitz, Alexandra 12 Hunter, John 216 IBM Kenexa 77 Ignorance 244 In-House Candidate Search Model 190 Individualism 232 Ineptitude 244 Interactive forecasting method 205 Internal guarantee 167 Internet of things (IoT) 86–89 Jagged resume 68–71 Janus 242

273

-RE¿W Joy, Billy 67 Kahneman, Daniel 15 Kane, Pat 3 Kelleher, Herb 3 Kestral 72 Kierkegaard, Soren 98 Kolko, Jon 107 Kotter, John 162 Krznaric, Roman 2 Labor markets 80 Leadership 114 Leadership imperative xvi–xviii Lean 121 Lean tools 122 Leberecht, Tim 6 Lehrer, Jonah 34 Lencioni, Patrick 18 Leverage structure 187 Levin, Michael 130 Liakopoulos, Andrew 66 Long-term orientation 232 Louis, Pierre-Charles-Alexandre 28 Low-skill/low-pay 88 Luther, Martin 40 MacIntyre 245 Madsbjerg, Christian 33 Maister, David 96 Maister, David H. 4 Manufacturing principles xix Masculinity 232 Maslowian 48 Mass, Bernard M. 217 MBTI 20 McAfee, Andrew 87 McCartney, Kathleen 46 McRaney, David 16 Meaney, Michael 46 Mendoza, Dave 82 Michael, Jean-Baptiste 79 Millman, Debbie 110 MIT 16 Moggridge, Bill 237, 238, 239 Mozart 43

274 Murphy, Eddie 50 Musk, Elon 86 Nabokov, Vladimir 32 Nature vs Nurture 42 New talent agenda 61–63 Nietzsche, Friedrich 45 Nohria, Nitin 9, 57, 243 O’ Reilly, Tim 86 Ogilvy, David 53 Ohno, Taiichi 121 Olins, Wally 111 Open talent economy 65 Open-source talent 66 Operations 165–166 Optimization culture xvi Organizations pursue success 11 Oyer, Paul 214 Paradox, Dilbert 11 Partnership talent 66 Pascal, Blaise 35 Patil, D.J. 81 Paul, Annie Murphy 20 Peck, Don 79 Perez, Carlota xi Perfect resume 73–75 Personality tester 20 Peters, Tom 4 Pfeffer 52 Pfeffer, Jeffery 9, 230 Piattelli-Palmarini, Massimo 246 Picassos 44 Pigliucci, Massimo 35 Pink, Daniel 229 Pinker, Steven 44 Potential 68 Power distance 231 Prehistoric hardware 14 Princeton 16 3URFHVVHI¿FLHQF\OHDNV Prosecutor 19 Purple squirrel hunter 23–24 Quality function deployment (QFD) 123 Quetelet, Adolphe 68

Index Rationality 107 Recruiting 166 Recruiting models 93 Recruitment Centre of Excellence (COE) 156 Recruitment process mapping xix Recruitment, digitalization of 83 Reeves, Martin xiii Ridley, Matt 48 Rivera, Lauren A. 132 Robinson, Ken 12 Rose, Todd 68, 71 Rubin, Robert S. 15 Rumelt, Richard 95, 179 Russel, Bertrand 72 SaaS. See Software-as-a-Service (SaaS) Sagan, Carl 29, 32 Sagan, Dorion 248 Sagan’s Baloney Detection Kit 13, 16 Sasser, W Earl. 112 Scarr, Sandra 46 Schlesinger, Leonard A. 112 Schmidt, Frank 216 Schulz, Kathryn 245, 246 Schwartz, Alvin 23 Schwartz, Jeff 65 Schwarz, Barry 6 Schybergson, Olof 238 Science of Fit Research 119 Seaman, John T. 100 Sears, David 139 Secretan, Lance 2 Seedcamp 72 Service Level Agreements (SLA’s) 167 6HUYLFHSUR¿WFKDLQ Seung, Sebastian 47 Shakespeares 44 Shelley, Percy Bysshe 78 Shenk, David 47 Sigma 101–102 Sigma Group xii Simon, Herbert 107 Simonton, Dean 43

Index SIPOC. See Suppliers–Inputs–Process– Output–Customers (SIPOC) Skills gap 247 Smart, Geoff 19, 49 Smith, George David 100 Snapchat 92 Software-as-a-Service (SaaS) 203 Sophisticated professionals 4 Sourcing 165 Sourcing will change 77 Specialization 92 Sponge 22 Stewart, Justice Potter 39 Stickdorn, Marc 108 Strategy framework 145 Street, Randy 19 Successful transformation 176 Suitor 20 Suppliers–Inputs–Process–Output– Customers (SIPOC) 126 Susskinds 85 Sutton 52 Systems thinking (ST) approach 140 TA compass 106 TACOE. See Talent Acquisition Center of Excellence (TACOE) Taleb, Nassim Nicholas 30 Talent 40 mastery 45–48 natural ability 43–44 people–subject approach 48–54 Talent acquisition (TA) 77 Arab spring for 76–78 evolution of 65–67 Talent Acquisition Center of Excellence (TACOE) 187 Talent management (TM) 77 Talent scorecard 136

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Talent spotting 67–68 Talent war 58 Talent, compete on 238 Talent, widen your view of 71–73 Taleo 77, 131 Talk the walk 177 Tansley, C. 41 Taylorian 73 Thinking gap 247 Thoreau, Henry David 7 Tildrow, Dick 37 Tolstoy, Leo 17 Toyota Production System (TPS) 121 Transformation meaningful 177 Transforming 170 Trickster 21 Tugend, Alina 44 Tversky, Amos 15 Twain, Mark 2, 100 Uncertainty avoidance (UAI) 232, 233 Value stream mapping (VSM) 126–131, 171, 172 Victorian software 14 Vitality 181 Vitality dimension 146 Voice of customer (VOC) 122 Voice of the business (VOB) 122 von Neumann, John 43 Wasserman, Noam 9 Watson Wyatt’s Human Capital Index 241 Woods, Tiger 43 Work excellence at fundamental motivating forces 3 hire for 8 people value at 6–8 Yo-Yo-Ma 43