Food for Thought

Theory of Limits

Many of us in the corporate world are used to top line and growth. In the world of business and commerce, an organization is judged by how much the company's revenues have increased compared to the past period. Growth is measured by the number of people added, the profit margin etc. This is the MATERIAL world. In real life, we chase growth, which is actually RELATIVE. Growth is always with respect to something - prior standards or others. Growth encompasses everything from income to profit to career growth. It is considered a measure of failure, if we have not grown, promoted etc. Profit is no longer a dirty word. Ambition, Career growth  etc. are virtues in the current world.

Let’s take the case of any organism - even the human body. We continue to grow till we reach adulthood, after which physical growth is not a sign of good health. When the body cells multiply and grow beyond the natural limits, it is nothing but, cancer!

Law of Conservation

Every student of Thermodynamics knows that there is something called as Carnot efficiency. This is the limit, which nature had put on efficiency of any natural process. There is also a law of Conservation of Mass & Energy, but there is no such law of Conservation of Profit & Loss in commerce! In fact, one man’s gain is other man’s loss. Accountants may not agree, but then, when there is situation of all around profit or gain, it is the universe which is at a loss. This is because the use of natural resource to have the profit has not been accounted in the input side of the equation.

Concept of Contentment

Let us understand what contentment is, by way of a simple arithmetic equation:

It will not be wrong to define contentment as follows:

                            Happiness

Contentment = ----------------

                             Growth

Now let us analyse this equation.  We say, once I build a house, my children are settled in life, after I retire, ad infinitum...... I will be happy and contended, as we would have achieved whatever we wanted from life. Thus Happiness & Contentment are directly proportional.

Let's understand the implication of denominator of the above equation.  Growth is, increase in demand, size, desires and needs. This growth is against the law of nature, as we have seen what an unlimited growth of an organ means - it is cancer, Also we need to understand that increase in cost, profit , revenues are all relative, anytime where money is used as a unit of measure. A liter of oil has the same calorific value, whether it is today or tomorrow, but it's cost & price would have changed. In reality nothing has changed. The change is virtual or Maya. So when we talk of growth, we are talking of Maya and as growth increases, contentment decreases.

We have all along talked about material growth & not spiritual growth. Spiritual growth does not follow the laws of Mathematics and Sciences.

Determinate?

Let us imagine of having a piece of string. The boundary condition is that the ends of the string are held in our hand as shown below:

The other scenario is when the string is floating in free space as shown below:

It can take any shape. At some instance, it is likely that the string will have a determinable shape, and in this case, let us take the 2 imaginary points A & B, when it is in a straight line for making the discussion simple.  

What is the similarity and difference in the above 2 scenarios?

At some point of TIME, both segments of the string may have a similar shape i.e a straight line, or more generally a shape that can be determined and defined. The difference is that in the former, the ends of the string are held and therefore there is a tension in the string between the ends. It is this force at the ends of the string that gives it the shape .In the latter, there is no tension between the ends.

Life is exactly like the string in the second case.

The ends are indeterminate – like the string. We operate in a limited boundary and define the various milestones. We are happy when some or many events fall in place as predicted, but we fail to understand that these truths are just an illusion, like the points in the second string and not permanent.  Points A & B are analogous to birth and death, both of which are not in our control, as in the string in the second case, and yet we take pride in how much control we have on the various points, between A & B.

Adjectives

We use adjectives to qualify nouns – No big deal, all of us know this!  But then, these qualifications are RELATIVE and are with respect to some norm or standard. A strict boss, a kind person, a smart employee, an intelligent boy etc.  Do we not pass judgement while affixing these adjectives?

Who determines strictness, kindness, smartness, intelligence…………………? Aren’t these very relative and subtle? What purpose do they serve? 

Let me give an example here, which many of you from the corporate world can relate. There are many times, when we say:  “He is a good candidate “, OR “He is a reject “- a remark made mostly based on their knowledge of the subject.  The truth is that no one is good or bad. Only that this person is not aligned to a specific requirement, at this moment in time. What is knowledge – is a subject in itself.

We can comprehend the above, but what we fail to comprehend and internalize is: what is “success” and “failure”?  We are quick to label someone as successful, based on our frame of reference and not on the beholder’s frame.  A little reflection will convince you that this is the truth. 

Now that you have agreed on this concept, let me stretch this logic a bit further. Let me illustrate this with a simple analogy here. Our ears can hear sounds only of certain frequencies and SEE light of a band of frequencies. Does that mean, there are no other frequencies of sound or light? Of course not, and science as it exists today has proven that communications happen beyond the above ranges.  So it will be wrong to conclude that there is no music or beauty in the other frequency range of sound or light.

We have always believed that human form is the ultimate in terms of evolution from other species, as far as our definition of good, great, intelligent etc. are concerned.  This is because we SEE manifestations of behaviour and we have defined them as good or bad.  There are certainly other organisms, which can communicate and enjoy at other frequencies, which are beyond our comprehension.  This being the case, it is quite probable that the “Lower” forms of organisms are really the “Higher” form – closer to the SUPREME.  Do we not often allude to “the good old days” and how things were much better, in the days of yore?  Is this not contrary to the direction of evolution? 

What we have been trying to grapple above is the circular nature of life / evolution / duality – In reality there is no beginning or an end, which means evolution has no direction. What we perceive as duality is only relative. When we say that the second’s needle of a clock moves in a clockwise direction, it is true, when viewed from the front of the clock, but when viewed from behind the clock, the same second’s needle is moving anti clockwise. That is the conundrum. 

The Selection and Recruitment Game

Introduction

Staffing is one of the most critical functions for the success of any Organization. This article demystifies the function and explains how one can go about the whole process. This white paper can be a useful reference document for corporate staffing manager as well as for the practicing recruitment consultant.

Background

The Staffing Manager must be very clear about the background of the vacancy to be filled. The likely scenarios could be a replacement, or an absolutely new requirement. If it is a replacement, the situation gets more complicated. It is possible that the current incumbent is still continuing in the job and the management is considering getting a replacement without the incumbent’s knowledge. The sensitivity of such a situation is imaginable. It may also be possible that the subordinates would be eyeing the job and when they come to know from the grapevine that they are not being considered in the race, the morale takes a beating and the new incumbent will have a tough time. The easiest case is when the vacancy is for a new position or when the current incumbent is also involved in the selection process.

The Process

ü  The first step to the whole process is defining the requirement vis-à-vis the above background. There must be absolute clarity on the role, the reporting relationships, the performance measurement parameters and the compensation envisaged for the position. Quite often, some of these are left vague in the hope of attracting all potential candidates. The ulterior motive is often to save cost, but the end result is a huge waste of time and money, which is not accounted. This happens by way of refused offers, meeting many candidates than really required etc.

ü  Depending on the background, one must determine the approach to be followed. This is akin to the “Make or Buy” decision taken in the conventional manufacturing industry. The options available to the Staffing Manager is either to get external help or fill the vacancy by using the recruitment team’s effort internally. If the decision is to do so internally, the choices are again to advertise the position in newspapers, business & trade magazines, internet portals or employee referrals. Only when confidentiality is an issue, would an advertisement using a post box number advised. However, research has shown that these options do not attract the best and the expense is a sunken cost. Advertising, directly with the company name, logo has a lot more advantages, including a lot of mileage for the company. However, it may be counterproductive if the company directly advertises similar jobs too often.

ü  If the decision is to seek external help, then help is available at hand. They come in various forms and names viz: placement agencies, recruitment consultants, Search firms, Executive Search Consultants or manpower consultants. All permutation and combination of the words are there in the industry. However there are some distinctions between those who add value to the whole process and those who just “peddle” resumes.

The basic distinction is of those who act as a consultant – like any management consultant, valuing inputs based on time spent and those who just broker a deal. For the former, there is seldom any clash of interest on the process or the end result. Such firms are hard to come by. Their professional fee is normally “fixed “and is retained in nature. A diluted version of this is the firm, which engages itself on a retained basis to work for the client, with deliverables clearly laid out. “Retained” concept is that in which the firm is paid periodically on achievement of milestones, irrespective of the outcome. The down side is that the payment is a percentage of the compensation offered and obviously there is a conflict of interest.

The other is the “contingency” model, where in the payment is made only on success. The downside is that there are too many players and commitment of the firm is suspect. However this is a very cost effective model, if a right firm is identified and the user also patronizes just a couple of firms. 

Once the decision on the selection of type of firm is firmed up, the other point on the decision tree is whether to advertise or not. The fundamental issue that would come up is twofold:

1)      An advertisement most often taps the active job seeker, though not hundred percent of the time. The respondent to an advertisement has shown his willingness to seek a change. The timelines can be adhered to very comfortably, but the copy of the advertisement must be very specific, without frills. An effective advertisement is one that produces a good % of shortlist against the total responses. An approach highly recommended for middle and junior level openings.

2)      If the potential candidate is to be identified without placing an advertisement, the approach is normally to rely on a database held by the selection firm or search by mapping the market and headhunting to identify the passive job seeker. This might apparently reduce the cost of advertisement, but the downside is that the candidate acts like a superstar, the compensation to be offered gets bloated and timelines are longer.

   Beyond this point the other steps in the recruitment process are very straightforward. The incumbent is interviewed, references checked, and an offer made. The interviewing process could be either a general profiling, a detailed competency based assessment or a combination of the above. Competency definition for a job and its assessment is a specialized subject on its own. Reference checking is an art and is a delicate subject. It must be exercised with caution and this also requires specialist skills. Making an offer, getting it accepted and subsequent follow up, till the incumbent is actually on board, is required to close the loop.

Conclusion

Most often, the point of contention about effectiveness of recruitment by an internal staff member vis-à-vis an external consultant arises, because of large communication gaps in the earlier part of job definition process.

Staffing Challenges

When business is in upswing, companies have to hire, both to meet the growth needs as well as to offset the loss due to attrition. Hence the staffing team has to meet this cumulative requirement. The line managers also want only candidates, who can hit the ground running and are seldom willing to invest time to train candidates. They cannot be blamed as they have their own business pressures and the world is no ideal place.

"Six Sigma", "Zero defect" and “Just in Time” are approaches practiced in the manufacturing sector. Even here, implementation of these concepts requires political will from the top management, as the benefits would be seen only after a sustained period of time. “Yield” or “Conversion” is another useful metric.

When we take staffing as a function and apply these metrics, it will be useful to measure the stage to stage conversion ratio, starting from sourcing for relevant profiles to the final offer. At every stage i.e identifying of relevant profiles to the initial shortlist, CV shortlist to interview and final interview to offer stage, the conversion is less than 50 %. After a herculean effort of producing the final shortlist with a conversion of close to just 20 %, there is a huge indeterminate factor, which is a challenge for employers. This unpredictable factor is that of “drop outs” after the interview stage. These dropouts are far more valuable for an employer, as he would have sunk all the time & effort to arrive at this stage. Let us examine possible improvements in the process, which can reduce the cycle time of hiring and also the costs.

At the first stage, increasing the so called “Yield” from the initial profiles to the numbers called for interview is possible only if the Hiring Manager is clear on what he/she is looking for. Many of the rejections at every stage happen from a “safe to err “on the side of ideal requirement. 80 % of the assessment happens to unearth, the unknown / weak areas of the incumbent rather than his attitude or potential or strength. The biggest bottle neck is here,( the hiring Manager's decision to reject a candidate as "unsuitable" ) which is neither dissected nor quantified. Normally the hiring manager has to take responsibility if the incumbent fails in the job, so it is safer for him to reject a potential candidate and err on the safer side rather than take the risk and hire. The above metric is used to measure the staffing team’s effectiveness rather than that of hiring manager. Imagine, if this is a measurement parameter for the hiring manager – he will spend more time in making his requirement clearer / or devote time to make the hire successful! Hiring Managers must be encouraged to read " The Paradox of Choice - Why More Is Less" by Barry Schwartz and "The Art of Choosing" by Sheena Iyengar .

Hiring Funnel

The second area of improvement is in the closing of offers, where the dropouts can be minimized. This can be achieved through close follow-ups, reliable background verification and use some services which can actually authenticate the offer acceptance process. (There is a service “iAccept” launched recently to address this gap, tapping on the job seeker giving his “Word of Honor”)

In the long run, companies who do not compromise on ethics and core values are the ones who will be able to tide over these vagaries, as there is a high degree of correlation between attrition % and the hiring effort. When growth is organic, it is healthy and inorganic growth, in a sense is cancerous!