What is outcomes-based hiring, and why is it valuable?
It’s a methodology that forces you to start with an outcomes-based scorecard – it can be applied to more than just the interview process; it can be applied to the entire people program.
It forces you to ask “what am I trying to solve with this role” – before you start thinking about, I need to hire for “XYZ” role, start with a scorecard to think about the outcomes of the role. Put on your business hat and think about what you need to solve the role.
It forces alignment – with every person involved in the process, so that when we’re interviewing, sourcing, and eventually bringing this person on, we have a very clear roadmap of what success looks like throughout the process of hiring.
What are the steps to take from the time you decide to open a spec, to when you choose a person to hire?
Step 1: Budget and headcount plan – ideally each role has already been slated into a broader team-wide plan for the year or quarter. Of course, sometimes that’s not possible, because you realize a need within a quarter, or you need to backfill for a departing employee.
- Who is this person reporting to? Who reports to them?
- What team are they on?
- What is the salary and location for this role?
- What “must-have” and “nice-to-have” skills are needed for the role?
Step 3: Create a scorecard – the hiring manager should be involved in crafting a scorecard that enumerates the right set of outcomes and skills for the role (see more on scorecards below).
- Remove gray area – make sure everyone understands the scorecard the same way, e.g. what does “good communication skills” mean for that specific role? The way I define good communication skills for a product marketer is very different in the way I describe good communication skills for an engineer.
- Make sure different interviewers cover different ground – the scorecard will act as scaffolding to assign which interviewers focus on which competency area (with different interviewers responsible for going deep on different scorecard categories).
- Start with a recruiter screen – a junior recruiter can cover housekeeping items like salary expectations and sponsorship status; an experienced recruiter can have a more detailed conversation.
- Hiring manager interview – to assess the candidate across the entire scorecard. The hiring manager will make the centralized final decision based on the data they’ve collected and the data interview panelists have provided them with.
- Other interviews – should be empowered to help collect more data than the hiring manager can get alone. They can provide a second checkpoint when a manager is excited about a candidate, and they can cover more surface area of a candidate’s competencies.
Step 6: Debrief and take next steps – after the final interview, debrief to talk through each interviewer’s respective feedback. If the team can’t make a decision based on the data collected, schedule a follow-up conversation to collect more information around specific competency areas. Don’t keep people waiting; decide to collect more information or disqualify them.
How can you widen the top of your funnel to generate strong candidate volume?
Set the right criteria for the role (be careful with heuristics) – heuristics are only proxies, so it’s your job as a talent practitioner to push back and say, “What are these proxies for?” Once you get to the bedrock of that, you can back up and say, “Well, there are a lot more personas that fit the criteria than I originally thought.” People often go into the search too narrow, so a talent leader’s job is to remove those heuristics and widen the aperture.
Leverage partnerships – with candidate communities, platforms, and marketplaces so you can cast a wide net.
Invest in a talent team if you’re planning to hire 9+ people per quarter – a recruiter can help fill ~3 roles per month, so invest in a talent team when you’re high growth and your headcount plans are clear.
What measures can you take to avoid bias, at the top of the funnel, and through the hiring process?
Switch from “I need someone with X background” to “I need someone with X outcome” (with a scorecard) – stop leaning on heuristics and shortcuts; instead think “I need someone who fits the description of my scorecard, meaning that they can get outcomes 1, 2, 3, and 4 done”.
Record and share feedback to force critical thinking – recording feedback immediately forces you to think critically about what you’ve just experienced. If you’re just jumping from one interview to another, you’re going to carry that bias with you.
Reference back to the objective scorecard – hold people on the team accountable to basing assessments on outcomes, not on flat and shallow characteristics. If people stick to the objective scorecard, it’ll help to filter a lot of the bias out. I’ve helped hiring managers do this. After an interview, they might say, “Great interview, but she didn’t have XYZ” or “she didn’t come from X company.” So I’ll point them back to the scorecard and remind them that those requirements aren’t a part of it.
What is a hiring scorecard, and how is it different from the job description?
The scorecard is the job description’s pragmatic sibling – the scorecard doesn’t have the tone and energy that a JD does (the JD is an advertisement, and it’s allowed to be a bit more colorful than the scorecard). The scorecard is more matter-of-fact, it’s the mission and trajectory of the role.
- Mission – how this position adds value to the company. Start here, not with the responsibilities of the role.
→ This becomes the header of the JD
- Outcomes – 3-5 specific SMART goals for the role (specific, measurable, attainable, relevant, time-based) that align with the business’s objectives, or their departmental goals.
→ These align with JD bulleted description of what the role does
- Competencies – are a bridge between skills, lived experiences, and behaviors. Skills are typically technical, e.g. this person needs to be able to build API architecture. Characteristics get to a person’s nature or affinity, e.g. a strong sense of design. This section gets at the persona of the person you’re looking for.
→ These align with the skills section of the JD
The scorecard isn’t secret – the scorecard drives the JD, which is public. You can even walk through the scorecard with the candidate in later stages to start a conversation about the scope of the role. Especially with more senior roles, I’ve seen the founder bring the scorecard to the candidate and say “Hey, this is a scorecard. This is what I think needs to get done.” If the candidate is really savvy, like a first VP of sales, they might say “this is my domain and I don’t think outcomes four and five make sense.” From there, it becomes a conversation to fix the scope of the outcomes. I believe in complete transparency.
What are the key components of a good job description?
Start with the scorecard, not the job description – the scorecard needs to be very pointed and outcomes-driven. Pull outcomes from the scorecard and translate them into bullet points so they’re more factual for the JD. The only thing the scorecard is missing that the job description has is tone.
- Transparent – be clear and specific about the job and why you’re hiring for the role; don’t say “you’re going to have a large influence on what product means tomorrow” Instead, say “you’re going to devise a product roadmap by the end of Q1”. Be upfront about the problems that need to be addressed and what needs to be accomplished.The right person will find the challenge exciting.
- Clear – every single bullet should be pointed. Avoid fluffy language and vague terms like “rockstar” or “ninja”.
- Concise – be very concise, especially about what your company does. It needs to be 1-2 sentences, and the structure is, “we do X, solving X problem.” Research has shown that people don’t care much about this when they’re reading job descriptions. Then move into the trajectory of the role, which is literally why you’re hiring for it.
- Value prop at company level – put this in the first 1-2 sentences.
- Value prop at role level – why are you hiring for this role? You’re attempting to sell both the company and the role in the first section of the JD.
- 5-9 bullet descriptions for what the person does – prioritize them based on what the person will be directly doing followed by what they’ll be indirectly doing. What the person will be directly doing is pulled from the scorecard, followed by what they’ll have influence over.
- Describe the persona you’re looking for (skills) – be transparent about the organization and your reasoning for filling this role. Companies often try to describe the person they’re looking for, but if you describe your company and the specific problems you’re solving for, the right candidate will be able to envision themselves there.
- Perks and benefits – be extremely specific when you’re writing this, not “we have a 401k”, “we have a 401k with an X% match up into X amount dollars.” Things like “great team culture” isn’t a benefit.
- Equal Employment Opportunity (EEO) statement – some people think this is obvious, and you don’t need to include it, but unfortunately, it’s not obvious. You should make it clear that you accept people from all walks of life.
- Don’t make it too long – most prospects read the description on mobile.
- Avoid embarrassing errors – like spelling and grammar errors.
How should you aggregate feedback from each interviewer?
Find a way to collect blind feedback – in a perfect world, you have an applicant tracking system, but whatever you do, don’t have your information in a Google sheet that’s shared with everyone. Have the feedback be submitted blind to help eliminate bias. If you don’t, you’re doing yourself and the candidate a disservice by sharing feedback before you move to the next stage.
In the debrief room, have a good facilitator – the CEO should provide their interview feedback last, because if everyone is meeting to debrief on a candidate, the CEO goes first and says, “I love this person” it’s going to influence other people’s feedback.
How should teams think about “cultural fit”?
“Culture fit” can be dangerous if you’re not intentional about it – screening for “cultural fit” can become dangerous when the culture is ill-defined, i.e. if there are “in-groups” and “out-groups” or cultural norms are something that you should “just know.”
Organizations need to talk about their culture and live it before screening for “culture fit” – culture fit comes from constant conversation and healthy debate amongst employees, then writing values down and putting them into action on a daily basis. The values shouldn’t only be talked about once a year during a performance review, teams should be having hard conversations around not living values
How should you make a job offer to a candidate?
The offer shouldn’t be a surprise; use a pre-close/trial-close conversation – this conversation involves realigning on salary expectations, covering any reservations the candidate may have (and who they need to speak to about those reservations), asking the candidate if they’re in the late stages of being hired anywhere else.
It should typically come from the hiring manager – in a competitive hiring market, sometimes you can “kick it up” and the CEO to make the offer.
What should companies do after the offer is accepted to prepare for a successful start?
A lot can go wrong in this period – I’ve seen people sign and accept and then not show up on the first day.
Have a ridiculous amount of communication – in-between the time when they accept to the time when they start. You don’t want the candidate to accept, have four weeks go by, and then the next time you talk to them is when you send a “we’re excited to see you on Monday” email.
What metrics should you track?
Stage-over-stage pipeline conversion – for each of the stages in your candidate pipeline.
- The amount of qualified candidates you receive through inbound applications (a lagging indicator, but good to track)
- The amount of people that have viewed and applied to your job posting.
- Response rates
- % positive responses vs. % neutral or negative responses
Note what a “good” metric is – metrics vary a lot based on factors like industry and role; establish a baseline within your company.
What are the most important pieces to get right?
Plan and operate with talent as a core function – audit your talent function and start to treat it as a core function. Do you have the right processes and technology in place to coordinate and record your feedback in a methodical and unbiased way? Do you have a headcount plan and have you strategized how your budget will work with it?
Start using outcomes-based hiring and using a scorecard – it seems hard, but it’s like going to the gym. You just have to start. It’s hard to get started, but once you do, you start getting stronger.
What are the common pitfalls?
Leaning on heuristics – too often companies say they need someone with a Stanford MBA or someone coming from a big four accounting firm. I don’t have anything against those pedigrees in particular, but they’re really just proxies. You need to figure out what they’re proxies for and hire for that.
Ignoring the data – if you interview 20 people in 3 months and 16 of them are disqualified, that’s an ineffective process. You wouldn’t accept putting out a product that has 80% churn, so you shouldn’t accept it with hiring either.