Hiring Step #1: Measure Your Baseline Success, page 62.
- What problem does the measurement step solve? Managers who are not Topgraders almost always lack an understanding of how successful (or unsuccessful) their hiring and promoting methods are, and they don’t have a clue as to how much their mis-hires cost them.
- Shouldn’t we be as rigorous in hiring as we are in capital spending?
- Most companies wing it on the front end without creating a Job Scorecard and without specifying nearly enough competencies.
- Most managers never go back to calculate the benefits of good hires or costs of mis-hires, and never systematically consider how to do better next time
- Everyone knows that important items in business must be measured or the results will never be achieved and sustained. But most companies do not measure one of the most important things that can be measured in any business – success in hiring and promoting people.
- Some companies I know have two main measurements of hiring success – how fast they hire people and how cheaply they do it…but they don’t know if their fast, cheap hiring produces superior or mediocre hires.
Four Topgrading Calculators
- Baseline Hiring Success Calculator
- Write the name of the people you have hired in the past three years.
- Rate them a year after they were hired, either high-performer or a mis-hire.
- Calculate % high-performers.
- Calculate # Mis-Hires.
- Now do the same exercise, but only do it for the people you’ve promoted.
- This creates a company’s Pre-Topgrading Baseline.
- When companies begin Topgrading, they measure their results annually to track their progress.
- Topgrading Talent Projection Calculator
- The Topgrading Talent Projection Calculator will tell you how many people you’ll have to hire (and fire) in order to achieve 90% success, given your present success rate (is it 25%?) and what your future success rates will be with Topgrading as you improve to 50%, 75%, and 90%.
- Estimate your current number of people to be replaced.
- Estimate your hiring/promoting success rate…your percent As and A Potentials after hiring and promoting people.
- Use the Topgrading Talent Project Calculator to show the total number of people you must hire or promote in order to end up with 90% As, after replacing all those who turn out not to be As
- You’ll quickly see how many people you will mis-hire (and fire) to end up with 90% A Players.
| # To Be Replaced | 25% | 50% | 75% | 90% |
| 10 | 36 | 18 | 12 | 10 |
| 20 | 72 | 36 | 24 | 20 |
| 40 | 144 | 72 | 48 | 40 |
| 100 | 360 | 180 | 120 | 100 |
- Success short of 90% is spelled out in the Calculator and it spells pain.
- With a typical 25% success rate, for example, replacing 10 people to achieve 90% A Players would require hiring 36 replacements – and replacing 26 of them. No company could survive such a revolving door. And, by the way, what A Player would want to join a massacre-prone company?
- Another important consideration is how long it would take you to replace people.
