Tech sector leaders last month advocated the use of merit, excellence, and intelligence (MEI) as their recruiting strategy to hire the best and smartest talent.
At the same time, some decried diversity, equity, and inclusion strategies as somehow requiring suboptimum talent. (If they mean reducing qualifications, I would agree. DEI should never lower hiring standards to achieve a “diversity” hire.) MEI advocates say they want to select the best talent without any bias in any direction. The question I have for them is, without hiring metrics, how will they know?
Opinions promoting MEI have been expressed by Alexander Wang, the founder and CEO of Scale AI and Elon Musk of X (formerly Twitter), SpaceX and Tesla.
Writing in LinkedIn, Alexander Wang wrote:
We believe that people should be judged by the content of their character — and, as colleagues, be additionally judged by their talent, skills, and work ethic.
There is a mistaken belief that meritocracy somehow conflicts with diversity. I strongly disagree. No group has a monopoly on excellence. A hiring process based on merit will naturally yield a variety of backgrounds, perspectives, and ideas. Achieving this requires casting a wide net for talent and then objectively selecting the best, without bias in any direction. We will not pick winners and losers based on someone being the “right” or “wrong” race, gender, and so on. It should be needless to say, and yet it needs saying: doing so would be racist and sexist, not to mention illegal.
The problem with meritocracy (as first expressed by Jack Welsh at GE in the 1990s) and MEI is that it fails to hire the best talent when biases are unchecked. That is, when there is not a structured process with hiring manager training, skill testing for job candidates. metrics and corrective action. On the other hand, DEI fails when it leads to a zero-sum game with diversity hiring goals (which are not required by affirmative action plans in the private sector) and lead to suspicion and conflict in the workplace.
I agree with Alexander Wang the goal is to hire the best qualified candidates who meet the skills and requirements of the job. Because the US has a long-term labor shortage, I appreciate Alexander Wang’s awareness that recruiting works best when it includes a broad candidate pool. However, I did not read anything about having recruiting and selection process that attracts a broad candidate pool and assess talent accurately so that unconscious biases don’t creep in leading to an organization that unwittingly hires poor candidates. I also did not read about recruiting and hiring metrics to verify that the best talent is hired without biases that weed out qualified employees.
I hope executives understand that when casting for a broad candidate pool, companies need to review the branding on their career sites and wording on their job descriptions to ensure it does not drive away female and people of color candidates. Studies have found that over 50 percent of job postings drive away applicants, especially women, when male dominated terms are overly used. Learn more here.
Without processes, training, and metrics, companies often end up with “hiring by gut feel,” meaning relying on dumb luck. Research shows that most interviewers make their hiring decision in the first five minutes and then spend the rest of the interview looking for evidence to verify their decision. If you hire all the time from friend referrals or the MBA programs the executive staff graduated from, your organization may be susceptible to group think and suffer from missed opportunities and a lack of innovation when new problems arise.
All organizations should have well-defined recruiting and hiring processes and training for all hiring managers. The best screening tools are structured interviews and skill tests. Having two interviewers screen for collaboration behaviors, ethical behavior, and, when needed, manager skills is optimal.. Having two interviews screen for technical skills is ideal. When more than four interviewers are used, research shows the organization does not learn anything new, and people’s time is wasted. Learn more about hiring methods from this blog or my book, Hack Recruiting.
Recruiting applicant tracking systems (ATS) are very helpful for tracking metrics on recruiting processes, checking for biases pay equity. The best ATSs provide quick communications on hiring decisions to applicants, which provides them a good experience, can ask early screening questions, and schedule interviews. Here are nine tips for purchasing or upgrading game-changing ATS and best practices for using them.
I have experience with meritocracy and MEI
In 2000, Allied Signal purchased Honeywell Inc, and put in place its “meritocracy” processes that were taught to me as an HR leader at Honeywell Space Systems. Meritocracy included firing the bottom 10 percent every year and hiring new, and presumably better talent to replace them (based on a wrong understanding of Professor Scullen’s forced ranking system ), hiring managers and engineering talent from “targeted schools” (such as Harvard’s MBA program), and using a hard-charging rotation programs that moved employees across the country or world every 12 to 18 months. Leaders were fired if they missed their goals for two quarters.
Why the meritocracy failed
There were five reasons the meritocracy failed:
- Many interviews by executives were concluded in half an hour with the interviewer claiming he only need twenty minutes to assess a candidate. Wrong. This is the executive version of hiring by gut feel and is not supported by research (as discussed above).
- The rotation program retained only 80 percent of their hires after three years. When I pointed out the lousy return on investment from this program, I was told that “it was their brand and philosophy.”
- Firing the bottom ten percent led to expensive lawsuits, which curtailed the practice. It also caused employees to claim credit for themselves, which destroyed collaboration, and to keep innovation to themselves for fear of making the wrong suggestion and getting on the layoff list. To learn more on why you should not use forced ranking, click here.
- Hiring from target schools wasn’t effective because of the turnover. Research since then shows that organizations are better off hiring the top talent from regional schools. They are less expensive and have less costly turnover.
- Executives woke up to the understanding that if you move high-potential leaders too fast (in their rotation program), they never have to clean up the mess caused by their early decision on a role. Cleaning up your mess is a great learning experience.
Affirmative action plans in industry are not about setting hiring quotas
When affirmative action plans (AAPs) are in use, such as when a company has government contracts, they are very helpful for assessing at the aggregate level if qualified protected class candidates are being disproportionately screened out during the hiring process, beginning with the interviewer and then hiring manager screening, the hiring decision, and the value of the job offer. (This includes screening out white or black, male or female job candidates, and by age.) Corrective action is required to stop the bias and ensure the best candidate is hired without regard to age, race, gender, and disability.
Companies should never use AAPs to set diversity hiring goals like doubling the hiring of black candidates in two years.
The enthusiasm for MEI will lead to bad hires if CEOs don’t follow the guidance from hiring research. Have a structured hiring process, use structured interviews, train managers, and track metrics to make sure you are hiring talent that is successful on the job and is free of unconscious biases.
About Victor
Victor Assad is the CEO of Victor Assad Strategic Human Resources Consulting and Managing Partner of InnovationOne, LLC. He works with organizations to transform HR and recruiting, implement remote work, and develop extraordinary leaders, teams, and innovation cultures. He is the author of the highly acclaimed book, Hack Recruiting: The Best of Empirical Research, Method and Process, and Digitization. He is quoted in business journals such as The Wall Street Journal, Workforce Management, and CEO Magazine. Victor has partnered with The Conference Board on innovation research. Subscribe to his weekly blogs at http://www.VictorHRConsultant.com