Employers are always on the lookout for prospective hires with skills for the job at hand, and have potential to grow into larger roles.
Unfortunately information is asymmetric, and it’s not easy to know ex ante who in our applicant pool are adequately-skilled, and who are insufficiently so. Some hires will fit well and do the job. Others won’t. That’s the risk we take.
Here’s something I’m starting to think about… isn’t hiring similar to investing?
It is hard to consistently generate alpha in markets. In fact, investment disclaimers tell us that ‘past history is not indicative of future performance’. Yet we do the very opposite for hiring!
Pedigree is not a precursor of performance.
I am starting to wonder if for hiring, instead of attempting to pick ‘alphas’, we can consider building a team of ‘betas’ that are coachable.
Hirers never truly know. There are no sure-wins. In professional football, not even ‘proven winners’ like Jose Mourinho could do the job at Tottenham Hotspur, while then-unproven upstarts like Mauricio Pochettino outperformed and brought 4 years of Champions League to North London.
Is Skills-based Hiring a myth?
LinkedIn recently announced “Skills Path“, a pilot skills-based hiring programme, supported by Singapore’s National Jobs Council.
The topic of skills-based hiring is not new and comes up every few years. In fact, I co-wrote an opinion piece on this topic 3 years ago:
LinkedIn’s announcement checks all the boxes. Unfortunately it doesn’t move the needle. There is a grand total of 8 companies under the programme offering a mere 6 job roles: customer service, data analyst, project manager, recruiter, supply chain coordinator and sales development.
To be fair, this initiative is a pilot. I fully support starting small, tracking the data, and if it looks like it works, scaling up only then.
As what I co-wrote above (and the LinkedIn initiative postures), the hope is for hirers to look past academic qualifications as a non-negotiable filtering tool for prospective candidates.
Otherwise, no matter what is said and done, incentives will drive behaviour, and every rational student will pursue the degree, because non-graduates continue to be disadvantaged at the hiring gate, and for career advancement.
Should we NOT try to pick winners?
Hiring well is crucial for every organisation. It’s also exceedingly-hard to do well, for reasons discussed above.
Which is why there’s so much money being spent on good hiring solutions, and much innovation in this space. The Singapore HRTech Market Map (brought to you by hrtech.sg & Adrian Tan) lists the different companies providing solutions for your organisation’s Talent Acquisition needs.
I wonder if we could take a different approach, and look further down the employee journey. I’m referring to the Talent Development area, where ArcLab has some track record (irony intended).
Since it’s so hard to bet on winners when hiring, could we adopt a more “portfolio” approach, especially if we are a large organisation. This means not optimising for the perfect ‘alpha’ candidate, since he/she does not exist. Rather, we do a few things to attract the ‘beta’ candidates:
- Properly profile job requirements & packages. No ‘padding’, no ‘undercutting’
- Set a minimum bar for the candidate. Everyone who meets this gets an interview (virtual or otherwise), which is more to assess team fit. Involve the team in the interview and give everyone an equal vote.
- Suss out open-mindedness and ‘train-ability’. Look for evidences of picking up new skills and applying them.
- Where possible, consider a work trial for demonstration of competency, softer skills and fit with potential colleagues.
Hiring a team of ‘betas’ means we don’t go all out to find Ivy League graduates. It means we put in place an exceptional learning & development programme, because we know that investing in our workforce gives our organisation the best chance of success.
Since people are the lifeblood of our organisations, we should put our money where our most important assets are, and invest in them, through training them to be the best professional that they can be.
The best part of this approach is, by hiring coachable people who have not yet been ‘proven winners’, we hire humble people, who are not afraid to admit they don’t know. They are then able to learn what’s needed to do their job so the organisation (and they) succeed. And when business requirements change, they change accordingly.
That means continuous, bite-sized training. Because no longer do we study for the first 10-20 years of our life and work for the rest. We study for a basic minimum, and keep learning as we work.
I submit to you that this is one good way for an organisation to succeed.
We’re building that sort of organisation at ArcLab, and helping many companies build theirs.
Can we help your organisation build yours?