Solve your #1 Problem
by Geoff Smart and Randy Street

1. Your #1 Problem

The difficulty that companies have in hiring people accounts for many billions of dollars in productivity and opportunity lost every year. Through a large two year study undertaken in a collaboration between the University of Chicago Business School and ghSMART they have developed the four step process to reduce hiring problems.

2. Scorecard: A Blueprint for Success

Before even looking for new candidates, it is vital to know exactly who you are looking for. It is important to take this beyond the generic (ie: VP of Sales) and bring the context of the hiring need into the scorecard. This scorecard will be the document that potential hirees will be evaluated against and it has four dimensions.

  • Mission

o The Specific role and purpose that this individual must achieve. It is important to ‘boil out’ the business lingo here and have a clear cut, defined purpose that everyone can easily grasp.

  • Outcome
  • o Here are about 3-5 ranked goals that the candidate should have a 90% or better chance of completion within the next few years. It is important to make these challenging however, as this will scare away B and C players while attracting the challenge driven A players.

    • Competencies

    o General principles of how you want the candidate to perform these goals. Typical examples include: Efficiency, Integrity, Persistence, Proactivity, Attention to detail, etc….

  • Cultural Competencies
  • o This is an intangible that basically means: Make sure this candidate will fit within your organization based on his habits, values etc…

    3. Source: Generating a Flow of A Players

    The most important stream of candidates is through referrals. Both business and personal referrals were found to be, by far, the most effective way of bringing in the right people. This chapter goes into depth discussing examples of business leaders who nurture their contact network by continually asking talented people: “Who are the most talented people you know that would be perfect for my business?” And then following up with these people and continuing to follow up and document the people on index cards or spreadsheets.
    Other less effective means of sourcing candidates are recruiters and researchers, but these generally have difficulty finding people that ‘fit right’ because of their limited nature of the specifics of the situation.

    4. Select: The Four Interviews for Spotting A Players

    This chapter recommends a process of four separate interviews where it is important to get out of the habit of watching how somebody acts during an interview. As this timespan is not indicative of their overall behavior in their normal working day and there is little predictive value in these interview behaviors.
    The four interviews are:
    1. Screening Interview

    • A short phone based interview designed to clear out the B and C players. They recommend a consistent script of four questions in order to assist in the ability to compare candidates and accelerate the process:

    o What are your career goals?
    + ideally the goals here will match the mission from the scorecard, also look for passion
    o What are you really good at professionally?
    + Ask for specific examples of these traits and keep an eye on the scorecard
    o What are you NOT good at or not interested in doing professionally?
    + This is a better way to ask what for weaknesses.
    o Who were your last five bosses, and how would they rate your performance (1-10) when we asked them?
    + Make them honest by saying ‘WHEN we ask them.’ and consider 7’s average, and 6 and below to be bad, as a 6 really means a 2.
    2. Topgrading Interview

    • A chronological walkthrough of the candidates career with these questions:

    o What were you hired to do?
    o What accomplishments are you most proud of?
    o What were some of the low points of that job?
    o Who were the people you worked with? Rate them?
    o Why did you leave that job?
    3. Focused Interview
    4. Reference Interview

    5. Sell: The Top Five Ways to Seal the Deal

    This chapter deals with getting the candidate interested, excited and eventually committed to working at the organization. The authors emphasize that you must be selling at every point in the system – sourcing, screening, in-depth interview, after the offer, and ALSO during the 100 days of work (many people get “buyers remorse” and will try to cut out early if they really don’t like it). They emphasize five important “F” factors to sell the candidate:
    1. Fit – Most importnant factor. By asking about long-term career goals you can tailor your answer to why this position is a good opportunity for them – how the position will work well with their strengths and avoid their weaknesses or “dis-interests”
    2. Family – often times the candidate can be sold but the family doesn’t want to leave old home (to move to a new city where the company is based). Make sure you show interest in the candidate’s family and help them come around to the idea of living in a new place.
    3. Freedom – A players don’t want to be micromanaged. Show them how this position will give them the flexibility to do things “their way” and that management won’t be breathing down their neck the whole time.
    4. Fortune – of course money is a consideration. If the incentive structure is broken up into options, bonuses and salary, say something like “After 5 years you could earn X dollars if you do well here”
    5. Fun – make sure the candidate knows they’ll have a good time – good coworkers, nice work environment, perks, etc

    6. Your Greatest Opportunity