April 30th 2019

CRFCast – HR Insights from the Corporate Research Forum: Developing Talent Acquisition Strategies to Win the War for Talent with Tomas Chamorro-Premuzic

Finding and hiring talent is a key business priority, but competition for top talent is fiercer than ever. To succeed, organisations have to develop robust resourcing strategies, using reliable assessment tools and sourcing methods to attract, select and retain the best candidates. In conversation with Professor Tomas Chamorro-Premuzic, we discuss the latest technology and trends in resourcing and explore how organisations can make better hiring decisions.

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Episode Transcript

Gillian Pillans [00:00:03] You're listening to the CRF cast where we explore research we've been working on here at the Corporate Research Forum and we discuss the latest thinking and strategic HR topics with academics, practitioners and leading experts in the field. I'm Gillian Pillans, research director at CRF. And you can find out more about CRF and listen to our podcast archive at www.crforum.co.uk.

Gillian Pillans [00:00:36] In today's CRF Cast, we're delving into the latest trends and how organisations identify, attract, select and hire talent into the business.

Gillian Pillans [00:00:45] My guest is Tomas Chamorro-Premuzic professor of psychology and chief talent scientist at ManpowerGroup, who's also my co-author on the recent CRF report titled Resourcing: How HR's Core Competence is Evolving, which is available to download from the CRF website.

Gillian Pillans [00:01:02] What we found in our research is that finding, developing and retaining talent remains a key business priority and a potential source of competitive advantage. However, competition for top talent is fiercer than ever and organisations are having to become ever more inventive, using new technologies to get better at identifying top talent and to build compelling employer brands and candidate experiences to attract the best. We'll explore some of these trends and how you can deploy them in your organization to improve the effectiveness of your recruiting practices.

Gillian Pillans [00:01:36] Hi, Tomas. Thanks for joining us today.

Tomas Chamorro-Premuzic [00:01:38] Thank you for having me.

Gillian Pillans [00:01:40] I'd like to start with a kind of general question. And so we've we've gone into the research. We've gone into a lot of depth about how you can do assessments of what works and what doesn't. But I think it's good to go back to basics and really talk about why is it actually important that we have a robust assessment and selection process? What's the business benefit of being able to do that?

Tomas Chamorro-Premuzic [00:02:03] So, you know, I think we need to start with a fundamental premise, which is that in any area of performance, there are consistent, systematic and predictable differences between people. So you can pick a generic organization, all areas like management, leadership or specific job type sales, accounting. And in any of these domains of organizational performance and individual performance, you will if you observe people for long enough, you will see that some people are just consistently better than others and others are worse than others. So what we're trying to do ultimately is predict as well as we can these differences so that we improve opportunities and job prospects for those who are likely to fit them, be happy in those roles and contribute more to the organization. And assessment is really just one vehicle for doing this. Well, the most important thing that assessment us is it's a vehicle for producing data, but otherwise not available because you can't rely on people's past performance or their external candidates or you don't know them. You're just trying to extract the maximum amount of predictive data in half an hour or one hour or an hour and a half so that you make better decisions and then everybody wins if you end up with a higher percentage or proportion of high performers in a role. People are happier. They stay for longer. They contribute more and organisations are more effective.

Gillian Pillans [00:03:41] Yeah, exactly. And I guess what we talk about a lot is you're looking you're not necessarily looking to get a definitive answer arrangement whether someone is definitively going to be a high performer or not. But it's about increasing the probabilities that you make a better selection decision.

Tomas Chamorro-Premuzic [00:03:56] Yes, it's it's it's ultimately about making a bet on somebody is probability to be a good fit for a role or a high performing candidate in the future.

Tomas Chamorro-Premuzic [00:04:10] And, you know, much like in the world of dating, if they're unlikely to be a good match, then, you know, they wouldn't want to waste their time in that role or in their job either. So, you know, it either works or it doesn't.

Gillian Pillans [00:04:22] And we could we could flip a coin or we could pick people at random. But what we're trying to do is get a better outcome than than those can be effective. Yes, exactly. Yes. Okay, great. So in the research, we we we kind of boiled down the words of assessment selection. This is a vast field. But essentially there are three things that we're looking to to determine when we're putting together an approach to assessment selection. The first thing is it's looking to determine what skills and characteristics should we be assessing. So how can we actually isolate those factors that are predictive of high performance in that particular role? Secondly, once you know what you're looking for, how do you actually assess those particular characteristics that, you know are going to increase your probability of finding high performance? And number three, looking after the event. How do you then know, looking back, was that you've made the right selection decisions? So I think if you if you can answer those three questions, then, you know, you're you're pretty well on the way to to having a process that that increases your competency of identifying high performers. So can we start with the first of those? And, you know, I think one of the things we found was and that job analysis plays an absolutely critical role in getting this whole system working correctly. And yes, it's not necessarily something that organizations do terribly well. So can we start there and just talk about, you know, what do we mean by job analysis and what more does that involve?

Tomas Chamorro-Premuzic [00:06:00] So ultimately what we mean is to identify or a highlight of the competencies, qualities, skills, the expertise that makes someone a high performer in a job. So let's say that we're interested in sales jobs. Well, what is required for a salesperson to deliver high levels of performance in a role? Well, it helps probably if they know something about what they're selling. It helps if if they're in I.T. sales that they have a. They like you or they're familiar with the products, but then, of course, they need to have people skills. Then of course they need to be able to manage themselves. They need to. So margin that you list the characteristics that differentiate between somebody who's good at their job and but a job. And then once you know what those characteristics are, then the question is, what is the best way to realize? To what degree an individual has these characteristics or not? So, yeah. So it's really kind of a basic thing. A job interview. It's more granular components so that you can ultimately match the right skills to that role or job.

Gillian Pillans [00:07:20] And I guess it's not just about identifying those characteristics. It's also about identifying the level that that you require.

Tomas Chamorro-Premuzic [00:07:27] Exactly. Exactly. And you know, and you have to work within the realms of what's feasible. You know, it's this isn't about asking for everything in all jobs because there's gonna be trade-offs. So if the job doesn't require a very high IQ, then maybe average is good enough. And what's more, needed for a specific job is either motivation or IQ.

Tomas Chamorro-Premuzic [00:07:50] If the job doesn't require speaking seven languages, then maybe one or two are enough. And also, what are the essential must have components and elements that are likely to make somebody a high performer in this role.

Gillian Pillans [00:08:05] And I guess it also helps you set cut-off points when you have identified your assessments and what specific measures you're going to use in your recruitment process. Then the job analysis gives you that the cut-off points or the ranges that you need to be within in order to find the right path.

Tomas Chamorro-Premuzic [00:08:24] Yeah. It's almost like, you know, if we're gonna cook a dish, what do you want to have on the plate and how much do you need? And then it's the recipe. You're writing the recipe and then come the ingredients. Different people have different ingredients. And then comes the tasting of the dish to see if it matches the recipe or not.

Gillian Pillans [00:08:42] Okay. Nice way of putting those three questions. We know that job analysis is really fundamental, but it's kind of it's kind of gone out of fashion in corporate life. And our research suggests that that's only just over half of companies who responded to our survey have a formal process in place for a job analysis. So practically speaking, how can organizations tackle face in a way that's both robust but also practical in today's organisational settings?

Tomas Chamorro-Premuzic [00:09:13] So, you know, it is important that they have training on how to do this, because to do it spontaneously or intuitively will not work or they will be reinventing the wheel. Luckily even in our resourcing report, they can have a look at how this works. But I think fundamentally organisations have three options.

Tomas Chamorro-Premuzic [00:09:36] Either get training on how to identify the key analytic components or a job over job and do a job analysis or leverage the independent academic evidence that is out there on what makes a good salesperson, what makes a good marketing or what makes a good leader. Because realistically, a lot of that will be transferable and generic. Oh, just focus on core ingredients or elements of potential, which is a different approach to doing selection, right. It's not so much doing a granular analysis of what a job needs, but trying to find people who are generally more likely to be high performing in the job.

Tomas Chamorro-Premuzic [00:10:21] And of course, what you add to that will still be the technical qualifications, expertise, et cetera. I think it's important to remember that most recruiting and most staffing and talent, that equivocation focuses a lot on resume as cities and technical expertise. So it's likely that organizations are doing that part OK. What's the weaker aspect is the soft skills, the generic psychological competencies, etc. which are typically ignored or immediate more from from the process. So that's where that's where I think they need to have a little bit of extra technical expertise.

Gillian Pillans [00:11:05] Okay. So let's let's go down a level on on that particular question and talk about. So what are the the best predictors of performance? And we know that science has been well established over decades and has come to some fairly firm conclusions about what those those predictors are. So let's look at my business.

Tomas Chamorro-Premuzic [00:11:26] So I think this is a very underutilized or undervalued. Fuck or scientific finding that although jobs are very different than there is millions of jobs and organizations have their own culture and there are so many contextual specificities that underpin a given role or job at the same time. There are these three generic buckets of potential which predict whether somebody would form one or not. And so they are ability like ability and drive ability compresses both your technical expertise, experience, knowledge. So the stuff that you report in your CV and then can profile and your learning potential. So it's what you know and what you are likely to learn. Likeability is your ability to manage yourself and others or thinks like IQ, Social skills, people skills think self-control. Very undervalued, very important.

Tomas Chamorro-Premuzic [00:12:30] And then you've got integrity. And then finally, drive is your work ethic, your ambition, your motivation. So fundamentally, you know, if you don't have time for a job analysis and you distrust your extensive competency framework and you don't have time to catch up with the latest thinking around grade learning agility, growth mindset, just try to hire people who are smart, nice and hard working. You will probably be OK. But you know, this is very underutilized. Most organizations either played by ear over complicated. And of course, it's not that easy to find a lot of people who are smart, nice and hard working. There are often trade-offs. You have people who are smart and hardworking, but not very nice. People who are not very smart, but nice and hardworking. But the closer you are to getting three out of three or having people who are balance highly enough on these three qualities, the more high performing individuals you will have.

Gillian Pillans [00:13:31] Okay, so if all we did in and our organisations was hire smart, likeable driven people, then we would already be in a better place to improve the overall quality of our talent base potentially.

Tomas Chamorro-Premuzic [00:13:43] Correct. Correct. Because you have people who are fast learners. They have expertise. They are nice to each other. Know how to work with each other. And fundamentally, they are driven to achieve and perform, you know. So, I mean, that that that would definitely be an improvement relative to the current status quo.

Gillian Pillans [00:14:03] OK, so let's let's talk about how you get to that point where you can act, how you can actually identify those smart, likeable, driven people. What are the best methods of identification?

Tomas Chamorro-Premuzic [00:14:17] So I think if I had to recommend a standard formula, I would say, well, screen out people on their technical expertise.

Tomas Chamorro-Premuzic [00:14:31] And that's part of the able of the smart or competence bucket, because, you know, you still need to be a pilot if you're being interviewed for a pilot job. And it still helps if you have some legal background. If you're being considered for a lawyer. So resume and screening for hard skills plus ability, you know, cognitive ability testing will for sure be the best single predictor of your learning potential and your learning ability. So let's say that you do that for the smart or ability bucket and then for the likability and drive. Generally speaking, personality assessments, one well-designed are going to be more productive than an interview. So I would I would, you know, follow the process with validated or valid personality assessment.

Tomas Chamorro-Premuzic [00:15:28] And then for the candidates that you shortlist that you can conduct a structured interview, well-designed would have. So if you do that, if you do those things. So screening for resume and hard skills. There's some data on that past performance. Fine, but it's mostly not as necessary as people think. And then personality assessment plus structured interviews, you won't get it right 100 percent of the time.

Tomas Chamorro-Premuzic [00:15:52] But let's say that your ratio hit ratio will be 80, 20 or 75, 25, which if you do it a lot over a number of years, does provide a huge our why over just playing it by ear or randomly picking candidates.

Gillian Pillans [00:16:13] Coming up in the second part of the CRF cast, we'll discuss how new technologies such as gamification, artificial intelligence and CV scraping are changing the recruitment landscape. We'll also debate whether technology improves the candidate experience or actually dehumanizes the selection process. And we'll consider whether replacing human judgment with machines might help us. A more diverse workforce. If you'd like to find out more about a research, you can listen to the CRF webinar on this topic or download our report. They're both available at www.crforum.co.uk.

Gillian Pillans [00:16:56] If you're enjoying the CRF cast, please subscribe to our channel to get the latest editions automatically and leave as a review and to share with your colleagues too.

Gillian Pillans [00:17:07] We are hearing a lot at the moment to base some of the emerging technologies around assessment and selection. So there's a lot of buzz around gamification, for example, or how artificial intelligence is changing the landscape around base. And just be interested in your perspective. Are you seeing anything coming out that's that's actually potentially going to disrupt this? They say this field that we should be paying attention to.

Tomas Chamorro-Premuzic [00:17:34] Well, you know, I think it's a very interesting area, and I think it's almost a renaissance of recruitment methodology and kind of activity turbocharged by new technologies. And the way I think about this field is, first of all, you're not you have a lot of novel activities or types of kind of, you know, unprecedented opportunities in the area of generating new types of data. Because before, you know, let's face it, just like in the early beginnings of assessment, you would turn up somewhere and complete a paper and pencil test and then that was digitized. Now, the next level is that, for example, we're already generating a lot of digital data voluntarily in other areas of of life that form part of a fragmented but nonetheless digital identity that could be potentially used to identify potential source.

Tomas Chamorro-Premuzic [00:18:45] New types of data can be gathered, video interviews, voice profiling, social sensing, gamification, as you said, and even scraping the web. All that data presents new guidance signals in a way or new potential signals or somebody's potential if you add it to a physical interview, psychological assessment, resume, et cetera. And then what may I thus I see that as a separate thing is just an approach for mining that data. And mostly I, especially in HR is machine learning, which really is a method for classifying vast amounts of data. And, you know, I think a good explanation for what that is, is it's cheaper prediction. The cost of classifying relationships or associations between that date and performance outcomes or the ability to find bathrooms in the data is now higher. So ability is higher. The cost is lower because computing has kind of enabled us to do this faster, cheaper, better and more efficient.

Tomas Chamorro-Premuzic [00:20:08] So, yes, on the one hand, new data can be gathered, new impressions or talent signals can be gathered from candidates.

Tomas Chamorro-Premuzic [00:20:16] And on the other hand, it is now quicker to program computers and easier to make sense of these data and find buttons. So in a way, it's nothing that novel, but it's a technologically enhanced version of what we had in the past. Each of these novel, you know, gamification is mostly simulations or situational judgment. That digital interview is the interview online and so forth. So big data is bio data and bustle. But yet some of these technologies might disrupt selection methods or recruitment methods that have been in place for decades, not necessarily for being more accurate, but for being cheaper, faster, more efficient and so forth. So it's important to pay attention to what's going on. At the same time, a healthy degree of scepticism is required. And we need to apply the same parameters to vet these tools as we have done for all tools over the last decades.

Gillian Pillans [00:21:21] Yeah, absolutely. So there's not necessarily new things to measure. The ways in which we measure and the quality and the speed of data is much higher.

Tomas Chamorro-Premuzic [00:21:31] Exactly. Exactly. The science and the attributes that we're looking for are there. And humans haven't radically changed in the last five years or 10 years because of the interview. But the ways in which we can judge or vet potential and predict performance are now there's a broader range of opportunities.

Gillian Pillans [00:21:48] I think one of the other trends that that we came across in the research was the the idea of and the user experience. And hey, that's an expression of the employer brand. So I'd take gamification, for example. There are some large organizations who are using that as a I said, in the very early stages of their screening process for graduates, for example. And not only does that allow them to sift out from huge numbers of applicants and hundreds of thousands a year potentially, but they would also say that is it and it becomes part of their employer brand. It's the the way that they present themselves in the market. As you know, forward looking organisations and making use of the latest technology and the need space sort of thing. So is that something that you you're seeing has has value in terms of, you know, part and parcel of of an assessment process?

Tomas Chamorro-Premuzic [00:22:47] Yes. So I think, you know, the most interesting novelty here is the sort of coming together or merging of, in a way, marketing and HR or branding and resourcing or the fact that, well, as organizations compete for potential employees in a similar way as they do for customers, they need to differentiate. They need to look cool. They need to look like an appealing employer, especially if you want to attract the top talent, but for whom the war for talent is being fought at. And people have realized, organizations have realized that one way of doing it is by creating tools or selection and assessment methods that can simultaneously work as a kind of employer branding device. So a lot of organizations are creating their own assessment tools. I attempt to look to things at the same time. On the one hand, vet the candidates and see if they're a good fit for the organizations, but also market the organisation and the employer and provide an experience of what it might be to work there.

Tomas Chamorro-Premuzic [00:24:16] And I think the wider kind of context for this is that, you know, clearly the work the work of world has evolved over the past 100 years. And today, you know, a lot of people, certainly people who are part of the knowledge economy or skilled workers, they don't just want the job, a well-paid job or something that pays well. They want a meaningful career and. Organisations need to offer them a consumer like experience, and that starts, you know, before you're even interviewed for a job. And so to do this virtually remotely, you know, I'm not entirely sure gamification is the way to achieve this.

Tomas Chamorro-Premuzic [00:24:57] But certainly today organizations care more about the candidate experience, even when they're part of this so-called pre hire market. So we haven't even we're not even considering you a formal job applicant. But hey, find out about us through social media, Facebook, whatever it is. This tool will enable you to get an experience of what it might be to work for us.

Gillian Pillans [00:25:21] Okay. Yeah. I guess there's a counter argument to that. That says recruitment is essentially a human process. And you you make a decision on who you want to hire and the candidate makes a decision about whether they want to join that organization based on human interactions. And so we're picking up a little bit of a backlash in terms of from the candidate perspective. So you talk to graduates and they will have completed 20-30 video interviews that you're all quite similar. And they they they'll have gone through that process. And not actually had any real life human face to face interaction. And in some some companies are actually not making an offer until you've gone through a virtual process. It basically the first time you will meet someone physically from the organisation is once an offer has been made. So I just I wonder what that and what implications that has for and for the engagement of candidates and their their perception of what it is to work for that organisation. Are there risks there that where we're taking out too much if there is the human factor from from our assessment processes and you know that at risk of of alienating the top talent, for example.

Tomas Chamorro-Premuzic [00:26:44] So I think there is that risk. And I think, you know, if you are sought after candidate and you want to be impressed and, you know, the process is tedious or dehumanize and it seems like the focus was on reducing costs and scaling this. And you're not treated like, you know, potential customer or, you know, kind of attractive employee, you might go elsewhere.

Tomas Chamorro-Premuzic [00:27:18] Yes. Let's not forget that the companies that have the biggest incentive to automate this and doing it at scale already have thousands of applications. And that's why they have done it this way.

Tomas Chamorro-Premuzic [00:27:32] So for them to potentially see come that itself excludes, you know, they might argue, well, if you're not that interested in coming here, we'll have some others that on the one hand on the other hand, they think that we often overrate the value of human interaction because much like you might prefer the human experience of a person interviewing you to going through an avatar or an automated system. While the reason for that might be that the person actually liked you, that they're part of the same group in group that they you happen to be for in their positive biases as opposed to their negative.

Tomas Chamorro-Premuzic [00:28:18] So, you know, for each and one of these candidates, I can give you the opposite example, which is somebody who is discriminated against or who is this like or who does and who is not able to click or simply maybe too introverted to perform well against humans. So at the end of the day, if a system offers superior or predictive power and you're likely to end up with more true positives and more true negatives, then it will be fairer.

Gillian Pillans [00:28:47] So there's potentially an argument for it for saying take your human judges, your human assessors completely out of the process because you will you will get a less biased and unbiased decision from a machine, potentially.

Tomas Chamorro-Premuzic [00:29:04] Yeah. Or, you know, let's let's pitch the two against each other and see. So I think that the point of technology is to do more with less and to improve our predictive accuracy at scale and on average. It's never gonna be every single expert and it's never going to completely eradicate serendipity. But hey, it's another tool. And if it enables us to lift average levels of performance, let's pay attention to it.

Gillian Pillans [00:29:32] Okay. So we've talked about how we can use some of the new tools at scale to improve the quality of assessment. I think the other factor here, and again, it's a human factor is the quality of judgments that said that assessors make. And so one of the things that I find quite surprising through this research was the the low level of training that goes into people who are making assessment decisions. So, you know, our survey said only 46 percent of companies actually require that line managers who are assessing candidates are properly trained or are qualified. How do you think we can improve the quality of assessment when a human judgment is still going to be involved in the picture?

Tomas Chamorro-Premuzic [00:30:19] Well, you know, I think the frustrating thing about this is that it is it would not take too long, you know, for people to go through it. It wouldn't be too difficult or too expensive to do so. I would say the only answer to a question is the willingness to do it. It's the only thing that is stopping organize it. So how can we persuade them to do it if they haven't been winning so far? Well, the return on investment. Ending up with 20 or 30 percent more high performing engaged individuals is huge and it can be quantified by any business leader or in their own context. So. And one of the main reasons why they might lose out to their competitors is because the competitors do this and are able to bet talent and performance, though, just to range off the conversation.

Gillian Pillans [00:31:08] Where do you think the biggest opportunities are for improvement around this?

Tomas Chamorro-Premuzic [00:31:12] So I think, you know, probably the single biggest opportunity to improve and implement some of the things we've just discussed is getting better at measuring performance and taking performance more seriously. Because if you don't know where your high performing people are or you have, you know, subjective we wishy washy criteria, essentially when I go into an organization and I ask people who are your most valuable start performance or your top performance and prove it to me. If you can't produce these metrics, then it's going to be difficult to implement any selection, any assessment, anything robust resourcing process, because you will never find out if it's working or not.

Tomas Chamorro-Premuzic [00:32:05] I always describe it as having an uber like system in place to distinguish between people who are high performing and low performing, you know, with an older driver. There is so much data on their daily, weekly and yearly performance that it's no there is no room for subjective opinions. We cannot be looking at the same driver. And you say, oh, I think, you know, this driver is doing well. And I've said, no, no, no, they're not. Why? Because we know how many journeys a day that day, whether they crash or not, how they're rated by customers. Now they're even profiled on whether they have a good conversation, whether the music is good, whether they go. So you have all these data to systematically and in an objective way rank order people on the basis of their performance. And although it is very difficult to do this for all your managers or your leaders or your sales people, you have to try to get as close to this system as you can. And then you will be able to predict that and you will be able to improve your resourcing system. So I think this is something that I want to solve because it requires human expertise, thinking and and doing the work to put these metrics in place and create these signals. But it's essential for getting resourcing right.

Gillian Pillans [00:33:30] Let's take a moment to recap the key points from my conversation with Tomas. First, if you get your assessment process rate, you increase your chances of hiring the people who will make Greece's contribution to your business outcomes. You don't have to overcomplicate the process, though. As Tomas said, you can boil decades of psychological research into three essentials hire people who are smart, nice and hardworking, and you will most likely improve the quality of your selection decisions. Second, in a highly competitive market for top talent, you need to regard recruitment as an extension of the corporate brand and compete for candidates in a similar way to competing for customers. Top candidates today expect employers to offer a slick, technology driven, consumer like candidate experience. And they want to get a realistic view of what it's like to work for the company. Finally, not only can the new recruitment technologies help make the process more efficient and cost effective. They can also increase the fairness of the process and help you recruit a more diverse workforce. If you want to find out more, download our research reports. Resourcing how each other's core competencies evolving from our website at www.crforum.co.uk. Also Tomas, his latest book, Why Do So Many Men Become Incompetent Leaders and How to Fix It expands on the themes we discussed around building greater fairness in selection and how that can help organizations meet their diversity goals. His book, published in March 2019 by Harvard Business School Press. Thanks again to Tomas for taking the time to talk to us.

[00:35:13] You've been listening to the CRF cast with me, Gillian Pillans, research director at CRF. You can find out more on our website at www.crforum.co.uk. Follow us on Twitter @C_R_Forum or join the CRF group on LinkedIn. Bye for now and thanks for listening.

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