Dr. Jac's Notebook

Winning the Talent War
Winning the battle for talent hinges largely on only two issues: effective hiring and supervision.

Effective Hiring: Essential Factors
Effective hiring can be measured in terms of retention, learning, performance and the shortest possible gaps in open positions.

1. Retention. An effective hire will have a longer than average tenure of service. Evidence suggests that when valid pre-hire assessments are used, the new hire almost always stays longer than someone who entered the organization without any assessment beyond eyeball interviewing.
   
2. Learning. An effective hire comes up to speed faster than average. One of the traits that assessment can pinpoint is the ability to learn and adapt quickly. Data from Unicru, a major assessment provider, shows that an effective hire reaches standard performance as much as 60 percent faster than the average new hire. In positions such as sales, the revenue gain is significant.
   
3. Performance. An effective hire provides better than average service, quality and productivity. As in learning, the effective hire not only gets up to speed faster but performs above average, with a typical case showing a positive gain of 6 percent over average sales performance. If your sales force increased sales by 6 percent, would your CEO be happy?
   
4. Gap. It is undeniable that the longer a job stays open, the more it costs the company. While an open position does save pay and benefit costs, it is illogical to claim that people are only an expense. If they were, it would be counterproductive to hire anyone. The facts clearly prove that people do return more in value than we pay them; if they didn't, we would be out of business. Therefore effective hiring is timely hiring. Every day that a position remains open constitutes an irretrievable loss.

Transactions: Another Measure Of Effective Hiring
Effective hiring can be measured in terms of hiring and separation transaction costs. Every employee who is hired, and who leaves, causes human resources, security, accounting, facilities and other departments to carry out a transaction. Each of these transactions costs the company money.

Just how much money depends on which estimates you accept. Costs have been determined to run as much as $1,000 or more per event. Even if a much lower figure is considered more realistic, moving people into and out of the organization means more costs that could be avoided with better selection and retention.

Fully Effective Employees
My theory of effective hiring does carry one caveat. A newly hired employee will only perform as well as he or she is allowed to. Many forces within an organization affect performance. Decades of research have shown conclusively that the immediate supervisor, at any level, has the most profound effect on employee performance.

When an employee meets a customer, we call it the moment of truth. This is the point at which all investments in strategy, planning, tactics, material, facilities and equipment are either leveraged or lost. Hidden in the background is the support that the supervisor gave the employee. The lesson? Support the supervisors who support the employees.

K.I.S.S.
Smart hiring practices are based on this maxim: "Keep It Simple, Smarty." Try to keep the talent war simple. This can be accomplished by focusing on the two issues over which you have the greatest opportunity for influence: hiring and supervision.

By Jac Fitz-enz, Ph.D.

Dr. Jac Fitz-enz is the founder and CEO of the Workforce Intelligence Institute and is the senior editor of Human Capital magazine. As the founder of the Saratoga Institute, Fitz-enz led the development of the world's most comprehensive human capital benchmark database.
He can be reached at (408) 223-7750.