IQ Interview: How Lou Adler Identifies Top-Third Talent
By Jamie Danziger
Lou Adler is CEO and founder of The Adler Group, an international training and consulting firm helping companies develop business systems to hire A-level talent using Performance-based Hiring. He is the best-selling author of Hire With Your Head and is a noted recruiting industry expert, international speaker, and columnist for a number of major recruiting and HR organization sites including SHRM, HRPA, SMA, ERE, and HR.com
We sat down with Lou to hear how his performance-based hiring methodology has allowed him to help companies raise their talent bar, and increase their proportion of great hires from 20% to 70%.
Questions:
IQP: Do you have an overriding people strategy?
LA: I definitely do. We help companies implement what I call a “raising the bar” strategy – a dedication to increasing the overall talent level of the company with each additional hire. I make the contention that if left to chance without a proactive hiring strategy in place, the overall quality of the company’s talent will decline for a number of reasons.
First, tactics outweigh strategy – the “need” for a person creates a sense of urgency that is more important than hiring the best person where it might take time to do that. Companies want someone who can produce today, even if it’s at a lower level - as opposed to somebody who’s going to produce tomorrow, and that in itself brings the overall talent level down. The rush to fill a position also brings the bar down, as do average managers who have a hard time hiring someone who is better than they are.
Implementing a raising the bar strategy takes a lot of work and a lot of effort, but from an economic standpoint, it results in staggering ROI when executed properly.
IQP: What do you do that’s different than other firms?
LA: Using performance-based hiring we have found a methodology that allows a company to implement a raising the bar strategy. If you look at all the research and all the science out there, it’s very clear that 50% of most hires underperform within eighteen months. And parallel to that, only 10 to 20% of managers would consider the people they’ve hired to be outstanding hires. That data alone supports the fact that most companies are lowering the bar through hiring instead of raising the bar.
Performance based hiring allows a company to raise the bar in a consistent timely manner that is scalable throughout the organization. And that’s what we do – we help companies raise their talent bar and increase their proportion of great hires from 20% to closer to 70% great hires, with the other 30% still being pretty good hires.
IQP: What are the key steps in your hiring process?
LA: Well before you devise a process, you need to understand how the top third - not the top 5%, but the strong B’s, B+’s, A –‘s - look for work, which is where we get to the sourcing issue. The fact is most of them are found through networking or a referral program. So understanding that, you then have to start thinking about how you can find them through advanced aggressive networking and referral programs – this includes employee referral programs and using an outside search firm that is deeply networked.
“Time of possession” is another critical variable. If you get good people as soon as they enter the market, you have a significantly better chance of hiring them than if you find them after they’ve been looking for three or four weeks. That’s what I call the early bird strategy. To get people even earlier you have to look at expanding your employee referral program, and let your employees reach out to people they’ve worked with and relay that if they’ve ever thinking of leaving, to get in touch. So you’re really aggressively targeting people either before or just as soon as they enter the market.
IQP: What are your key steps in attracting and assessing a star candidate?
When you get the name of top candidates, you have to recognize that they’re usually not interested in the job yet – you have to get them to that stage. As a result, it’s how you exchange information up front that’s important.
Look for areas where the candidate sees opportunity for growth, change, impact, and a chance to learn and do satisfying work – and then show them how the role you have offers that to them. You do that and the candidate will start selling you rather than you having to sell the candidate.
IQP: How have your hiring and assessment processes evolved over time?
LA: Our evolution has included implementing evidence based assessment, expanding the assessment criteria, and really looking at what predicted on-the-job success. For the last one, we made sure that everybody involved in the interview looked for things that would predict high on the job performance – the most important one being motivation to do that work. If a person didn’t like that work themselves and didn’t have evidence of doing that work in their recent past, the person would be a failure.
The key is finding people with the motivation to do that work as well as having successfully performed that work at peak levels and have shown to deliver consistent results over time. Once you can get that right the rest of the pieces usually fall into place.
IQP: What are your biggest current challenges with hiring and assessment?
LA: The two biggest challenges I see in hiring today are:
- How to raise the bar in the current economy – most top performers are currently employed and it’s very difficult to pull strong people out of jobs in this type of economy. People are more conservative and risk averse, so good people need more than just the typical “probability” of growth, now they need evidence or a guarantee of it.
- Companies and HR leaders are focusing too much on tactics and not enough on strategy. It’s our job to shift them to the latter – to show them the higher return you get when you have foresight and are proactive instead of reactive.
IQP: What would you say are the keys to retaining top talent?
Retention is linked to job satisfaction and top performers have identified the following four factors as critical components of a job they enjoy, and allow them to perform at a high level:
- Clearly understanding what’s expected of them
- Having the tools and resources to do that work
- Doing work they really like to do
- A manager who supports and develops their people
Lou Adler’s Top 3 Tips for Hiring and Retaining Top Talent:
- Don’t use job descriptions to screen people – clarify job needs up front and what these people need to do to be successful, not the skills they need to have to be successful. Then when you assess people, make sure they have shown they have done that type of work at peak levels.
- When you meet somebody – do not make a decision in the first 30 minutes. The top third are not necessarily the best interviewers. They might be casual, not all that interested in the job initially, may not look good, or may not be a very good interviewer. Don’t worry about that – only worry about if this person can perform this work at peak levels. By giving people time, everything has equal value.
- Don’t hire anybody unless you have 3 – 5 examples of their motivation to do the work you need done. Evidence is crucial.
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As Sr. VP, Operations, Jamie Danziger plays a key role in the on-going growth and success of IQ PARTNERS.
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