Hiring Dilemmas and Keeping Top Performers (600-5)

Herrenkohl's book, How to Hire A-Players: Finding the Top People for Your Team- Even If You Don’t Have a Recruiting Department suffers from four problems.

The first problem, a "dump them" attitude, is based on the static assumption we associate with human resources; that is that individuals have defined and mostly immutable skills and talents. In fact, in terms of cognitive tasks (vs. say a physical challenge of putting a ball in a hoop) rarely do individuals recognize their complete skill set. And supervisors have little time to investigate the full set of talents.

In an ocean full of fish, it may indeed be simpler to throw a fish back, but in a competitive market for talent there is logic in seeing if the fish you have can fulfill a need, but in a different area. And a more dynamic company will have expanding and changing needs. An existing employee who is not performing may be appropriate to meet those needs. It's far more efficient to take an existing known employee and move them to a position where they're more productive than to fire such an employee and to replace them with an alternative. Of course, if the fish is apathetic or nasty then put it back in the water.

The second weakness in the "get the best" attitude. This assumption also does not recognize that human resources are a competitive market. Folks who are "A players" understand that. They will, by definition, be more expensive and harder to retain. In some cases, such as programming, the added productivity far outweighs the added cost, but in that case it is mostly because better programmers like to program more than they like to negotiate salaries. In business, highly valuable staff are quite adept at negotiating higher salaries commensurate with the skill set. Consider what Goldman Sacks pays its upper level staff.

The effort to obtain "A-Players" may be equivalent to Porter's marketing strategy of a race-to-the-bottom. By competing for a limited resource you are implementing a plan that is repeating what your competition is doing. As in marketing, it may be more strategic to apply an approach that is unique and different. Look outside the obvious. You'll end up with a gem that no one else sees.

The third weakness is that the book is caught in an older/non-digital model of corporate growth.Most new startups with high capitalization are tech or life science companies. The book ignores the fact that in the current age we can have enormous corporate valuations based on just 20 employees. Recruiting 20 employees is not as challenging or difficult. Finding and optimizing talent is still important but with a low head count it need not be as complicated or time consuming. Performance problems will also be more obvious.

The final change that the book misses is the movement toward digital marketing and models of sales that do not use human resources. Marketing efforts, including social marketing and content marketing, feed the sales process and enable much more willing customers, thus decreasing the emphasis on a skilled sales team. Platforms create enormous potential wealth without the need of dedicated resources concerning human capital other than information technology resources to maintain the platform. And IT resources are commodities at this point that can be purchased from external vendors.

Reference:

1. Wasserman Noam. The Founder’s Dilemmas: Anticipating and Avoiding the Pitfalls That Can Sink a Startup. Princeton University Press. March 25, 2012, ch. 8.
2. Herrenkohl Eric. How to Hire A-Players: Finding the Top People for Your Team- Even If You Don’t Have a Recruiting Department. Vol 1 edition. Hoboken, N.J: Wiley. April 12, 2010, Conclusion.

Photo Credit: Carol GarnettFishing Father, Daughter Sunrise CC0 Creative Commons, Free for commercial use, No attribution required. Created April 23, 2006.