A Talentist

Time To Proficiency

(First published March of this year.)

There are two metrics that are at the core of any sales systems success. I have never heard of them measured or discussed. Because our language of technology (at least in the world of recruiting) does not include handy references to these factors, our discussions of technology keep coming up short. And we keep getting low adoption rates for the systems that we install.

Today we talk about the first and most important metric: Time to Proficiency (TTP).

No More "Passive"

I am not going to use the term “passive candidates” anymore. I have used it in the past as short-hand for describing a person who won’t ever be coming to your job site to apply for a job.

But the concept of a “passive candidate” appears to be a contradiction in terms. When I have been talking about passive candidates I have been speaking of people who are constantly updating and expanding their networks and finding ways to add value to that network. They work almost as hard as “active” seekers at getting to their next opportunity.

Because they are good at their jobs, and are in demand because of it, they expect you to come looking for them. They definitely won't be looking for you. Even more, they expect that you will have done your research and know what they do, why they are good and who else thinks so. This means they don’t expect to go through lots of interviews or have to prove themselves to potential employers. Their network can verify they are good and their network is trusted by the people who do the hiring.

So I would like to propose the concept of Brand Talent. (It may be that others such as Tom Peters have done this - let me know if you have heard of this before so I can link to their definition.) Brand Talent has the following characteristics:

68 Posts

68 posts. About 130 pages of content. A royal pain in the butt. A gut-wrenching act of public intellectual immolation. The last 10 months of my blogging experience have indeed been interesting. When you have three kids, a busy spouse, a new house, 2 dogs (soon to be 10), 4 cats and all the things that come with them, one has to ask “What the hell are you thinking?” Why put in the effort and time and heartache when it doesn’t make any money?

Experience and Education

Managing risk is an important part of what recruiters do. Recruiting is a gate-keeping service. We are starting to figure out that taking time to get the right person in is often less expensive than taking the time to get the wrong person out. Over time we have invented all kinds of tools and methods to manage risk. Once they have been around for a while people generally stop asking whether they work or not.

We hire people to complete tasks and run functions (not really – we employ talent to create value, but I’ll try to stick to the point). A good recruiter will want to figure out whether someone is capable of doing a task before they get through they get the key to executive washroom. But most recruiters are swamped, so they look for easy-to-recognize and generally-agreed-upon statistics to assess whether a person can really do what they say they can. The two most common are “Years of Experience” and “Degree (Education).”

The problem is, both of these are unreliable measures of whether someone can do a task or run a function. We tend to miss the point that both of these are short-hand measures of risk. After all, if someone has an MBA they can’t be stupid right? (Which means you need to hang around more MBA’s – you can’t take a blind swing at one of my family get togethers without knocking three of four MBAs to the ground, which is where they are probably going to end up after the punch is gone anyway). If someone has “programmed” for 10 years they have to be good at programming, right?

Wrong. We are just talking probabilities here. Risk analysis. If you take any two individuals and know only one fact about them (which one has had more experience doing a particular task or function), then you will draw the conclusion that the one with more experience will be better at the function. Or perhaps if someone went to Harvard and another person went to Whatsamatta U, you say to yourself “Harvard’s always better.” But they’re not. Dolts get into Harvard all the time. They are called Legacies. Sure, they’re rich dolts. But unless you are looking for a VC, that doesn’t really matter, does it?

It may in fact be that you are more likely to get someone who is qualified by virtue of their greater experience. But it is not a certainty. Do you know how great a risk you are facing? Is it a 1 in 5 chance that the person from Princeton with 20 years of programming experience can barely chew gum and walk at the same time? A 2 in 5 chance? And if you don’t know, then why use the measure at all? The probability of value is outweighed by the possibility of risk.

We have to be willing to demand proof of outcomes and behaviors. Have the candidate show you work they have done at previous companies (within the legal guidelines established by your company, of course). Have them demonstrate the reach and power of their network to you. Get testimonials from people you trust who also know them. And for goodness sakes, spend the time up front to create a “roles description” that can be evaluated with proof and outcomes.

Years of experience and education (other than in positions that require certification such as legal positions), are bad indicators of potential and unreliable measures of risk.

History, Theory and Legality - Why Lying Doesn't Make Sense

One of the things I have learned about blogging is that it is not a place for long tirades. People get bored and don’t want to spend their time reading you work out your issues in the digital domain. I know first hand, because I have rambled about stuff that gets the universal “what the hell are you talking about?” response. My readership numbers directly correlate to these posts. Talk a little, and they go up. Talk a lot, and they go down. So this little number should send the numbers right through the floor.

Everyone is blogging and talking about the Adler and Sumser conflict. I think that’s a good thing. But the debate seems mostly uninformed by corporate history, sound business theory or any basic understanding of the legal issues involved. So I thought I would reflect a little bit on these topics.

First, the entire discussion starts on the premise of the permanence of the labor contract. All arguments that have been posted start with an assumption about the level of hold an employer has on their employees. Many have related this to slavery: you haven’t been able to “own” a person since the emancipation proclamation (or Lee’s surrender at Appomattox), and so every employee is a free agent, completely free of the bonds of corporate servitude. Then there are those that say that approaching an employee of another company is like “stealing” – the person is (supposedly) happily employed and you go in there and try to poach / steal / take them out of that environment, which has does material harm to the company being alleviated of their employee.

Corporate History

In pre-industrial society (after feudalism but before mass production) you started as an apprentice. Fathers sold their sons into the employ of an artisan or craftsman so that the boy could learn their trade, eventually graduating out of apprenticeship to full artisan or craftsman status. It was against the law to try to “poach” someone out of this situation. (Many people still are stuck with this notion – that while you are getting your bread and education from someone else you are “owned” by them and that it would be bad practice to try to lure them away from a situation to which they are ethically and legally committed.)

Two things happened to change this: the civil war and the development of the steam engine. Steam power moved industrial production from craftsmanship to mass production, so people became employed by a large enterprise, not by an individual. Most people understand that. But what they don’t understand is that the very nature of the industrial enterprise was changed by the civil war. Companies no longer had to get congressional approval for incorporation. Lincoln needed more corporations to supply his troops, so congress changed the rules to make it easier to set up (and disband) a corporation. In other words, when the corporation became impermanent (since the barrier to entry and penalty for exit were both reduced), so did the employment contract.

This (and not the Japanese miracle of the 70’s) was the start of  our “free agent” work place. Over time the contractual obligation  between the employer and employee has gotten weaker and weaker. You knew that “ownership” of an employee was dead as a concept when IBM had its first layoffs in the 80’s. But this doesn’t mean that an employee has no obligation to the employer. Quite the contrary. In fact, the obligation of an employee to hold a employer’s information as valuable and proprietary information is at the heart of the rest of our analysis.

But overall the basic premise that recruiters “steal” employees is fundamentally bankrupt, not because slavery is dead, but because free market economics has successfully killed off every form of employee indenture, starting with feudalism, working through apprenticeship, and ending with life-long employment contracts. Employees are free agents in as much as they can freely change employment at will. And while the fluidity of the employment contract may cause real harm to employers as an employee who is critical to some part of the business is able to leave freely and without bondage, the value to individual to freely pursue their interests (perhaps this is the real “pursuit of happiness” of which Jefferson spoke?) outweighs the potential damage to the corporation.

Therefore it is not stealing or poaching (or whatever derogatory name you want to hang on the practice) when you attempt to recruit someone from another company, even if they are a competitor and by virtue of your act of recruiting you are impairing the competitor’s ability to compete in the marketplace.

So if engaging in the act of recruiting from another company is both legal and ethical (as defined by a civilly and legally defensible act that does not markedly decrease the value of your brand in the marketplace), then you have not crossed the line into hell whereby all actions are justified because you have already decided to do bad things (the old “if you are going to hold up a liquor store you might as well murder the clerk” argument of ethics, which is one of two roots of all evil, but I digress).

Business Theory and Practice

Sound business theory says that your objective is to create value for your investors. You must provide a greater rate of return than they would get for a similar amount of risk out of another enterprise. Therefore there are some enterprises which may provide a lot of return to investors, but with a high degree of risk, and others that the opposite (low return, low risk).

Engaging in risky business practice may be justified by the return. Many (most) businesses engage in behavior that according to a personal code of ethics would be abhorrent but which in a business are expected (“vapor ware” in the software industry is a great example).

Business seeks to return value to shareholders within a very constrained value system: “value for value” and “reward exceeds risk.” Over time government (as an agency of the people) has constrained business behavior: what is good for GM is not always good for America. They do this by proscribing criminal controls (fraud is a criminal activity for instance) and civil law controls (failing to file you annual corporate meetings minutes for instance) as a consequence for behavior that is seen an antithetical to the good of the society as a whole.

These consequences are risks, and therefore must be taken into account in the “reward exceeds risk” calculation. After all, if your company is going to get fined for undertaking a certain activity then that is a risk that may outweigh the value of the anticipated reward for executing that activity.

Again, businesses are not operating in the ethical constraints that an individual is. The corporation does not seek to get into heaven, and doesn’t have to look itself in the mirror in the morning. (I personally disagree with the basic corporate structure – it was wrong for the East India Company and its wrong today, but that is another question for another day.) But businesses do have to assess whether their activities create risks for their shareholders that outweigh the probability of return from pulling it off.

Legal Issues

So rather than focusing on the ethical questions of this debate, focus on the business issues. And the business issues are pretty significant. If you, as an individual or agent of a company, intentionally use deception as a method of business, you are more than likely liable for a civil action. Your risk equation has to include the probability that you will be caught and the probability that you will be sued. In the past, in the “wink-and-a-nod” underworld of recruiting, these probabilities were calculated to be low, so lying and deception were common practice. As the risk of these activities increases we will seeing a corresponding decrease in their use.

However, if you use deception as a method of getting an individual to break their contractual obligation to another person, thereby exposing the person who is deceived to civil action themselves, you are more than likely guilty of fraud. That is a criminal activity. As an example, if you employ the tactic of rusing someone into giving a name, and the person you ruse is under a standard employment contract, then you have encouraged them to break their contractual agreement with their employer that they will hold such information in confidence. If that person gets fired for such an activity, it is clear they have a civil action available to them (they can sue you), and it may be that the enterprise can report you to the DA for your activity.

Again, there is no need to view this from an ethical framework. This is just risk / reward analysis. The risk is real. How likely are you to be caught, and if caught sued and / or prosecuted? Only you can evaluate that. But given the fact that most recruiters are not trained in business theory and risk calculations, it is likely that their calculations are wrong. In other words, you are probably taking on a lot more risk than you think you are.

But what is the reward? If the reward for success is greater than the penalty for failure then it may be worth doing (assuming you have evaluated the probabilities of both occurrences correctly). It may be possible that the big score is worth the possible suit, or even going to jail. But only if the probability of getting the big score is substantially increased by the behavior in question.

And in this case, the answer is clearly “no.” A person who lies and engages in subterfuge in order to obtain the names of candidates is not significantly more successful in their efforts than a person who does not engage in such behavior. They may be marginally more successful, but the reward is clearly not worth the extra risk, even if you assume that the risk is negligible (and I can claim with certainty that the risk is both significant and growing by virtue of this debate coming to light).

I think Heather Hamilton’s article got to the basis of this, as has much good commentary. I do applaud ERE for publishing both sides of this debate, and for bringing it to forefront. In fact, from the “sound business theory” perspective, ERE has reduced the risk of my company by showing me the people who would in fact increase my risk of doing business by employing lying and subterfuge as business methods. This has been a real value to the larger (and therefore more exposed) companies that read the ERE articles and watch the dialogue on the boards.

Good News is No News

“Good News is No News; No News is Bad News; Bad News is Good news..” – Jim Morgan, Chairman, Applied Materials

Picture this: You are thinking about purchasing a new Applicant Tracking System (ATS). You are at the “pitch meeting”. The salesperson tells you that their application can slice and dice, never gets dull and comes with a lifetime warranty. You want to jump out of your seat and scream “Yes! I want that! Give me twenty of them!” But before you can even move, you hear the magic words: “Wait, there’s more!” More? More? How can there possibly be more? And then you hear “If you order now you’ll get…”

The Shopkeeper, the Gunslinger and the Inefficiency Kid

 

Since Applicant Tracking Systems first made it big (around ’88 or so) there has been a cottage industry that has devoted itself to two ideas: ATS products are unique in the ire they create in their user base, and ATS vendors are to blame for this.

 

When you been around the industry as long as I have you know neither of these things is true. Yes, there are people who don’t like their ATS, and yes, vendors own part of the blame for this. But this is really a systemic issue. There are many interconnected parts to this issue, each acting in its own best interest, and each sub-optimizing the overall solution opportunity. The good news is nobody is to blame. The bad news (and the underlying reason for the continually frustrating size of the ATS market) is that nobody has the ability to fix it.

 

When I try to explain this to people I usually end up with blank stares and requests for “one more round of drinks.” So I thought I would go out on a limb here and try to explain the situation as a parable, or story with a lesson. At the end of the parable is a “moral of the story” with a distillation of its points.

 

The Shopkeeper, the Gunslinger and the Inefficiency Kid

 

He had moved in gradually, like a spider crawling into a dark room. Although he was a big man with a terrible odor, nobody in the town of

Change General Store

could remember exactly when he had showed up. There they all were one day, the shopkeeper’s family attending to business, selling food to hungry townspeople, and they glanced out front and into the slumped back of a big, smelly oaf. They nervously smiled and asked him his name. “The Inefficiency Kid” he grunted, and then sat down and started to eat.

 

Day after day the Inefficiency Kid took up the whole front porch, ate the store’s food and generally made a mess of things. The shopkeeper couldn’t get the right goods into the store: the Inefficiency Kid just took up too much damn room. The General Store couldn’t get enough customers in to make the business work. Eventually the town’s people just stopped coming, figuring out other ways to get meet their growing needs.

 

One day the mayor of the town of

Change

came by. Mr. C.E. Officious was his name, and he ruled Change with an iron fist. Dressed to the nines he was, natty as a pin strip. He pulled the shopkeeper aside and said in a sweetly dangerous way, “I can’t have that big jerk hanging around here any more. Change is growing. Fast. And that guy is the only thing standing in the way of growing just as fast as I want it too.” He winked and nodded and passed small talk about how big the shopkeeper’s kids were, but everyone got the message. Take care of it. Now.

 

The shopkeeper was a decent, hardworking person. Her diligence and ingenuity and the hard work of her family had enabled the town grow. Fast. And she was rightfully proud of her accomplishments. Her name was Emma. Emma Ploy. But the folks just called her Em.

 

Em was not given to violence, so she approached the Kid and asked politely, “I’m really no good at this sort of thing mister. I know how to get the goods in and get the townsfolk buyin’, but I ain’t never had to get rid of a problem the likes of you. How about you just move along now so I can get back to doin’ what I do best?”

 

The Kid lazily threw a sideways sneer and belched. Then he went back to eating.

 

Em knew this was serious. She had to do something. So she decided to get help. Real help. Experts. She called in three cowboys from out of town. Good lookin’ fellers with fancy chaps and expensive horses.

 

Em showed them the Kid and described her problem. The first cowboy smiled and said “Why ma’am, we all agree. You have to get a hired gun. A gun slinger. And you have to get ‘em fast.”

 

Em was relieved. Finally, answers. Action. So Em asked the next logical question: “Who? Who should I get? How do I pick ‘em?”

 

The three cowboys recommended that Em buy them drinks. Over those drinks (drink after drink after drink) they slowly and surely painted a picture. It wasn’t clear. It didn’t help. But it took a long time to get out and caused Em to ask lots of questions. And for every question, there was one more drink.

 

The first cowboy said “The most important thing about a gun slinger is the kind of gun he shoots. Gotta have pearled handles.”

 

The second cowboy agreed whole heartedly, nodding like a Beagle following the turkey leg in Pa’s hand during a heated Thanksgiving conversation. He said “And also the kind of spurs he wears. Gotta be gold plated.”

 

The third cowboy was pretty drunk. He barely managed to gurgle something about “How he looks in a hat” before he went face down into the bar.

 

Em felt like asking the cowboys, “That’s all good, but what does that have to do with getting rid of the Kid?” But she knew that would just cost more drinks, and this was getting a little expensive for her budget. So she thanked them and sent them on their way.

 

The next day Em made an appointment with the mayor. Em started the conversation by saying “Now C.E., I asked the three best cowboys I could find what the heck I should do about the Inefficiency Kid and they said I should hire a gun slinger. What do you think?”

 

“Great!” bellowed C.E., slapping Em on the back. “Make it happen.”

 

“Well C.E., that’s the thing,” Em continued. “Its gonna take money to hire ‘em and I ain’t got none. You dole out all the money for that kind of thing.”

 

C.E. shot Em a sideways glance and mumbled under his breath things like “cost center” and “bottom line.” But eventually he said, “Well alright Em. How much do you need?”

 

“I don’t rightly know. I ain’t no expert in this kind of thing. I know how to move goods in and out and make sure they are the right goods and that people have stuff to buy and buy the stuff they want. So I’d have to guess. But I would say $10.” She waited.

 

It came. “$10? $10? Are you kiddin’ me? That’s real money Em! I got a limited pot of gold here and lots to do with it. There are more important things to do than get that big, fat slob off of your porch. I gotta build a system to get the cattle to market and I gotta pay the cowboys to get that system in place. And things like that. What are you thinking!?”

 

Em was crushed. But she plowed ahead. This had to get solved. “Well that’s all good and fine C.E., but what good is any of that gonna do if you don’t have a way to feed the cowboys and the cattle, if you can’t even get blankets? All the goods come out of the General Store. Dammit C.E. this is important!”

 

C.E. glowered, and then a fine, slick smile started to work its way across his face, like a rattlesnake making its way over a pile of sand. “Oh now Em. I know its important. Its not like I want to bring in one of the big general stores from the city to run the place. We just gotta make due with what we got. I know you can do it. You just take this fifty-cent piece and go take care of that bucket a’ lard and come back here and you can buy me a drink. Go on now!”

 

Em couldn’t believe her ears. Where was she going to find a honest to goodness gun slinger for half a buck? She didn’t know much about the guns-for-hire business, but she knew that wasn’t a lot of money to do anything at all.

 

The next morning she sent a courier into the big city. Within a couple of days a “gun slinger representative” showed up. People called him “the rep.” He liked that. He sat down with Em and started his talk:

 

“Emma Ploy, I know what you need. Four big guys with guns. Big guns. This is a tough job. I have seen the fella on the front porch and that is a whole lot of problem to get rid of. The price is right too. $100 and your problem is gone.”

 

Em almost swallowed her chewing tobacco whole. “$100? $100? I don’t have that kind of money. The mayor just gave me twenty-five cents and that’s all I got!” Em felt bad about lying, but she really didn’t have a lot, and she thought she could look like a hero to the mayor for saving even more money.

 

The rep looked at her with bemusement. “Twenty-five cents huh? Well, that won’t buy a lot. But I’d really like to do business with you.” The rep thought it through. This shopkeeper could turn into a long-term customer. She was likely to have problems like the Kid all the time. If the rep could get on Em’s good side there would probably be a lot more business where this came from. The rep didn’t think about the fact that if this shopkeeper didn’t make this problem go away, it was the shopkeeper, and not the problem, which would be new next time around.

 

The rep smiled and said, “Tell you what I am going to do. Have I got a deal for you. If you can raise your price to fifty cents then I’ll get my best man on it.” Em reluctantly agreed.

 

Days and days went by. Nobody showed. Em was starting to get mad. The Kid wasn’t going away… in fact, he was just getting bigger and eating more and more. And the smell! It was enough to rot the produce before it even got into the shelves. Em’s nerves were frazzled by the time the gunslinger showed up. A.T. Shot was his name. He was clean shaven and confident, but a little young. He said “Don’t you worry a hair on your head little lady. I know just how to solve your problem. I learned it in school.”

 

Em couldn’t believe a greenhorn right out of school was going to take on five hundred pounds of menacing threat sitting on her front porch. But Em was ready for some action. She called to her family and told them to come on down. She called the other townsfolk. She even got the mayor to show up. The Inefficiency Kid was finally going to meet his maker!

 

A.T. took out his gun and pointed it at the Kid. A hush fell over the crowd. You could have heard a pin drop. A.T. looked at the Kid with narrow eyes and said, his voice only cracking once or twice “Ah, excuse me sir. I hate to trouble you. Really I do. But could you please leave? Please?”

 

Please leave? Trouble you? What the heck was this? Em was furious! She went to A.T. and smashed him over the head with a frying pan she had been carrying into the store to sell. Now, A.T. was a bit of a jumpy type to begin with. He had been hit before by customers. In fact he was used to it. But each time it happened it shocked him. The force of the frying-pan blow caused him to involuntarily squeeze his trigger finger.

 

BAM!

 

The report of the gun startled the entire crowd. Everyone either jumped or hit the dirt. The bullet missed the fat target of the Kid by a mile. It hit a metal plate near the door of the shop, ricocheted off to a pail near the floor, and ended up in A.T.’s foot. “Darnit!” A.T. screamed. “This always happens!”

 

Em collected her senses. The Inefficiency Kid was sitting there snoring. And her gun fighter was jumping around, holding his foot and screaming (in between darnits) that he should have taken that job in supply-chain software he had been offered. “This just ain’t worth it!” A.T. was yelling to no one in particular.

 

Em couldn’t believe her ears. “Not worth it?” she hollered. “Not worth it? Didn’t I pay a good fifty cents for you? And so far all I have gotten is a good lookin’ kid with a hole in his foot. Get the job done or I’ll take my money back and get someone else who can do the job.”

 

A.T., in between howls of pain, was indignant. “Listen lady. The rep told me this was an easy job. I would have told him in a heart beat that ton of goo you got sitting on your porch ain’t gonna move with just a kiss. This is gonna take a whole bunch of my associates to make it work. And it’s gonna cost you a whole hell of a lot more than fifty cents. Hell, half that went to the rep anyway, and my bullets and the stitches cost more than the cash left over. I’m gonna need MORE money to do this job right!”

 

Em couldn’t have cared less about what A.T.’s problems were. She had the whole town lookin’ on. Hell, she even had the mayor. This was gonna turn out right or Em was going to show everybody who was boss. So she went over to A.T., took a gun out of her pocket (a little Derringer, but scary all the same), held it to the gun slinger’s head and said in a low voice, “Either you kill the Kid, or I kill you.”

 

Well, if A.T. had been nervous before, he almost wet himself at the thought of getting shot in the head by a shopkeeper with a peashooter. He raised his gleaming pearl-handled revolver, pointed it at the Kid, and closed his eyes. He hoped for the best. A.T. thought, “If only hopes were money, I would be the richest feller in town.”

 

The second bullet came out of the muzzle like a… well, bullet. It missed the Kid by a couple of yards and started bouncing off every metal object around. It hit horseshoes and wagon wheels and pails and plates and even a bell over the bar of the saloon. It hit everything but the Kid. And just as A.T. thought he was out of the woods and safe from his own bullet, it kneecapped him.

 

A.T. went down screaming like a baby who has lost his favorite blanket. The noise was unbearable. Em had had enough. The Kid, the waiting, the eating, the bullets… the whole thing was enough to make a decent shopkeeper go crazy. She went over to A.T. and kicked him and yelled, “Give me back my money and get the hell out here!”

 

And that was the end of A.T. Shot. Another gunslinger would have to be found.

 

But the Inefficiency Kid was still there. And the town had to grow. And the mayor still expected “results.”

 

Over time the Inefficiency Kid’s posse showed up. The Dastardly Duke of Ineffectiveness. The Sour Sourcer. The Clammy Closer. And each time the mayor had something better to do with his money, and each time Em just wished she could get the whole group of ‘em to go away.

 

One day the mayor called Em over to his office. He looked purposefully gloomy.

 

“Em, I’m sorry to have to tell you this, but the city is going to revoke your license. We’ve asked the big city market to come in and take over.”

 

Em was completely dumbfounded. She hadn’t brought these problems to the store, to the town. She had asked for the right tools to get rid the job done, even if she really didn’t understand exactly how to solve it. And now she was being kicked out. The unfairness of it all was too much to bear.

 

Em slowly rose and moved to the door. She thought of all the good things she had done, her family had done. Raising the town from when it was a barn and a saloon to thriving township it was today. The feeding and the care. The delivery day in and day out.

 

As she reveled in these memories a thought struck her. She turned on her heel and stared at C.E. Officious.

 

“How much?” Em asked.

 

“What?”

 

“How much for the big city, out of town store to come in? How much?”

 

A smile spread across C.E.’s face. He seemed genuinely pleased. “It turns out we are practically going to make money on this deal. Its just $200 up front but if we keep ‘em around for five years I make $100 profit. And the best thing is that they are going to hire the whole Inefficiency Kid Gang as clerks!”

 

The Moral Of the Story

 

· Staffing (Talent) leadership is very good at doing its job: getting people in place inside a company. But they are faced with problems that are outside the realm of the standard staffing expert skill set.

 

· So they call in consultants. Consultants don’t get paid for solving problems. They get paid for making clients feel better. Why? Because implementing real solutions requires risk and pain. And nobody ever got rich telling the client that they were wrong and that the way to fix their problem was to risk their job.

 

· Making the client feel better takes time and money. Employment departments don’t have a lot of either, because executive management sees the function as a tactical cost center as opposed to a strategic revenue opportunity.

 

· So the CEO / CIO nickels and dimes the solution budget, which leaves everyone in a bad position: the employment department doesn’t know exactly what it needs but understands it doesn’t have enough to do it, the consultants know that the “art of the possible” is mission impossible given the budget, and the solutions (ATS) vendor can’t deliver and support what it will take to really fix the issue.

 

· So the first thing that gets cut is the process reengineering needed to clean up the recruiting process (which, due to political infighting, mergers and acquisitions and lack of systems insight is usually a complete mess).

 

· This means that ATS vendors are faced with the following reality:

 

o Whatever recruiting process is around will be embedded into the ATS system as a one-off customization which IT doesn’t want to support and which future recruiting leadership will want to get rid of.

o The selection process won’t be based on the ability to partner with the customer to solve a long-term, systems-level issue, but will instead be based on a “feature-function” bake-off that will focus on functionality that won’t matter to 80% of the users.

o Because cost and demos are the primary selection criteria the employment department is increasingly likely to turn it over to purchasing. This tells the ATS vendor that the problem being fixed isn’t that important because purchasing departments manage cost and risk, not effectiveness.

o The selected vendor will have to try to maintain some account profitability by reducing cost of support labor (usually by putting their services staff on too many accounts to take care of the historically high-maintenance nature of the recruiting account) or by putting inexperienced people on the account.

 

· The customer ends up quite upset, which typically leads to blaming the vendor. Thus the customer ends up either shooting the vendor immediately (less likely) or waiting a couple of years until new employment leadership has cycled in, using that as the excuse to replace the vendor.

 

· In the mean time the vendor is caught off-guard because the reports they get from their customer are generally good. They fail to take into account that employment people get paid for creating and delivering good news and therefore aren’t generally good at communicating bad news early or forcefully. (And vendors always have happy ears anyway because they have to communicate to their management and investors that things are good or else they get fired.)

 

· And then, once the vendor is gone and all the problems that created the need for a vendor in the first place still exist, then the CEO gets upset because all they hear about are problems and costs, so they decide the smart thing to do is to outsource the employment function.

 

In the end the ultimate irony is that most outsourcing contracts require a higher level of cost and commitment (in return, hopefully, for efficiency and cost gains downstream) than was needed to really solve the issue in the first place. Nobody wins, everybody is unhappy, and the ATS market continues to stagnate as most vendors cannot develop the types of long-term partnerships needed to build a base suitable for growing the market opportunity.

 

From Profile to Portfolio

I am lucky enough to work in an industry that provides technological, creative and business opportunities. There are many different types of talent presented and pitched in a lot of different ways.

Lately I have been spending time learning about how creative people present their versions of “resumes.” It turns out that many graphic artists, lighters, shaders, etc. use what is called a “demo reel.” This is DVD, tape or other media that contains snippets of the work that they have done. Many artists present a sort of story arc to their demo reel, showing how they have grown over time and how their skills have progressed. It providers the reviewer (fellow artists in the form of recruiters and hiring managers) with an opportunity to see the candidate artist’s career and skills trajectory as well as the quality of their work. The demo reel is the modern artist’s portfolio of work.

I am strong believer that an increasing part of everyone’s jobs over the next 20 years will involve creativity. The Creative Age is upon us, and the value we contribute will be the value we create. So I have become intrigued by the concept of moving from resumes and profiles to portfolios for all the positions for which we recruit.

When we are looking for a “super star” or someone to come in and really change our business for the better, we are looking for someone who probably has put together some really strong creative work over their careers. They probably started by developing spreadsheets, project plans and other analysis, and then moved to developing presentations, articles and other forms of communication. These are all part of their creative history and should be considered as part of their portfolio.

Questions:

1. How do we create the portfolio while still protecting the IP rights of the original employer?
2. How do we present the portfolio in a way that is integrated with a narrative and story arc about their career, aspirations, assessment of their talent and opportunity for contribution?
3. How do we provide an opportunity for other people who have worked these people in a creative setting to vouch for their work (sort of like LinkedIn’s endorsements)?
4. How do we as talent professionals provide a way for people to apply for jobs with their portfolio, moving away from capturing the least amount of data we can quickly to capturing the richness of the talent in a more complete and dynamic way?
5. How do we move these portfolios effectively from one hiring authority to another?

There are many more questions. But I thought this might start an interesting dialogue.

The Three Ages

I believe that there are three types of businesses. Please note that these "types" are descriptions of philosophies and principles, not business models. There have been some great small foundry steel shops (which would seem to be the ultimate Machine Age business) that focus heavily on talent (and in fact view the delivery of steel as the delivery of applied content). There are also art firms that are no better than sweatshops. The models described below seek to evaluate the perception of management about how valuable the unique capabilities of human beings are to the long-term success of the company (return to shareholders, including employees).

Machine Age - Companies in this category see human beings as their top liability. Their machines can't run effectively without something with a pulse pulling the right lever, but (in management's opinion) just about any idiot can pull the lever. Since their machines make all the money, the people are the weak link in the economic chain. And since the skill level required is relatively low, people are seen as easily replaceable. Machine Age companies are the reason that corporate America gets the bad rap it so frequently deserves. If you think people are your greatest liability then you should outsource all non-production activities and hope that your shareholders don't notice that you are about to lose all their money.

Information Age - People create and use information, so people are every bit as important as machines. You still run the business to avoid risk to capital, but you get that without people you can't run the business or have much of a market for you goods and services. The cost of delivering value is roughly equal to the cost of developing value. These companies are interesting because they had to take lots of their shareholder's money and plow it into decreasing the cost of communication and delivery infrastructure enough that the Creative Age becomes possible. Information Age companies still do lots of dumb things, but they are usually close to understanding that there is a better way to do it.

Creative (or "Talent") Age -The cost of talent is higher than the cost of capital. The potential return on talent is higher than the potential return on capital (not applied to the purpose of acquiring and growing talent). The cost of developing value for the market is much higher than the cost of delivering it. Content is king, but even more so, the application of content to customer problems and opportunities is where the market value lies. These types of companies will rule the economic world of the future, and represent the light to the Machine Age dark. Its not that capital doesn't matter. It does. But you don' pay attention to trying to manage the risk inherent with employing capital (which is at the heart of so many bad business decisions), but instead focus on how to maximize the value of applied talent, which is inherently risky. But there is no way to get the returns your shareholders demand without taking those risks.

The Creative Age is where economics, humanism and epistemoligcal objectivism all come together. Hard to believe but true.

User Enthusiasm

Yesterday we talked about "Time To Proficiency" (TTP). This is a measure of how long it takes an average user to become proficient in the use of a sales tool (such as an Applicant Tracking or Recruitment Management System) without training. The purpose of this measurement is to gauge the implemented systems ease of use. This is important since sales people (including recruiters / talenteers) will not be fired for failure to use the sales system of choice. Sales people are rewarded for closing deals (candidates), not for entering data.

Today we talk about another measurement that is rarely, if ever analyzed or used, but which lies at the heart of the success of any system implementation: User Enthusiasm (UE).

First, UE is a critical measurement because of the very nature of software. Software breaks. Software is complicated. Software never seems to be up and running and error-free when you need it. And as software gets more complex than design and testing processes become advanced, things will just get worse.

That's why you want to measure UE. People who develop strong attachments to things tend to overlook their flaws. Take my wife for example. Or, even more germane to the case at hand, look at users of Macintosh computers. People love 'em. So when Apple doesn't come up with any significant improvement in its operating system for over 6 years, the devotees still line up to buy the latest hardware. It’s more than a brand thing. It is a "User Enthusiasm" thing.

So what is UE? User enthusiasm is a quantitative measure of a qualitative event: how much does a user really like their system? How devoted are they to it? How committed are they to riding out the rough times?

The easiest way to measure this is not through asking the question “Hey pal, do you just love this system to death or what?” (which is what most people do, and which is usually a waste of time), but by applying the techniques of behavioral interviewing and social science to the exploration of a person’s “like” for a system. You can tell how much a person likes their sales (recruitment) system by how much they sell it (recommend it to others).

Yes, it’s true. Human beings who like something try to get other people to like it too. They want to form their own club of like-minded individuals. And they do this by setting out to sell it to other users. Zealots beget zealots.

Conversely, if they are really ticked-off by the implemented system, they go out of their way to make sure that other people don't use it. They try to form the "Club of the Don't" as in "Join me in hating this damn piece of junk system and DON”T use it." It’s just like the other club, except the enthusiasm is generated by sheer contempt and rage at whoever has foisted this piece of detritus on their busy work lives.

So if you want to measure UE then measure how many times any user actively seeks to either promote or undermine the system. People who don't do either should be assigned a negative value (since apathy is usually a negative state of mind). Here is a proposed rating scale. Assign the points for every instance the user can call to mind (or not, in the case of apathy):

If a user can vividly recall an instance where they have told another potential user that they absolutely must use this particular system, then give them 2 points.

If a user can recall an instance where they have suggested using the system to another potential user, or spoken positively about it (for whatever reason) to anyone else (spouse, mailperson, family dog), then give them 1 point.

If they don't have strong feelings either way and therefore have not spoken to anyone, give them -1 points.

If they mentioned to someone (again, the whole family dog thing) that they don't like it, give them -2 points.

And if they have gone out of their way to make sure that no one with a pulse ever gets near the radioactive pile of waste that they believe the system to be, then give them -3 points.

As all you statisticians can see, this heavily biases the rating scale to negativity. Which is as it should be, since a positive user experience unusually doesn't yield as much upside for the purchasing company as a negative rating yields downside. An apathetic user won't put up with poor system performance, even if they don't complain to anybody about it. They will just start devoting their energies to working around it, thus undermining the system’s effectiveness.

Between TTP and UE, you can start to develop a good framework for evaluating whether a system is successful at your company.